Obama, corporate giants announce plan to boost suppliers

WASHINGTON Fri Jul 11, 2014 1:27pm EDT

1 of 2. U.S. President Barack Obama holds a meeting with company executives and their small business suppliers to discuss ways to strengthen the economy at the White House in Washington July 11, 2014. Flanking Obama are National Economic Council Director Jeff Zients (L) and senior advisor Valerie Jarrett.

Credit: Reuters/Kevin Lamarque

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WASHINGTON (Reuters) - President Barack Obama is enlisting several major U.S. and multinational companies to draw attention to an initiative aimed at helping small businesses expand and hire workers.

The president will meet on Friday with representatives of household name firms such as Apple (AAPL.O) , AT&T (T.N), Coca Cola (COKE.O) and Johnson & Johnson (JNJ.N) to spotlight the corporate giants' pledge to pay their smaller suppliers within 15 days.

The speedy payout puts more money in the coffers of smaller firms and helps them invest and hire workers, the president and his aides say.

For the larger companies, the initiative ensures that their own suppliers are robust and "demonstrates a recognition that a healthy supply chain is good for business," the White House said in a statement.

Frustrated by a legislative stalemate with the Republican-led House of Representatives, Obama has vowed to act unilaterally when he can to achieve his agenda, and the announcement Friday is typical of the sorts of modest initiatives the White House has unveiled.

This approach has antagonized congressional Republicans who say the president has overstepped executive branch authority.

House Republicans on Thursday made public a "discussion draft" of legislation to authorize legal action against the president for misusing executive orders and other unilateral actions to advance his agenda.

The supplier initiative is based on a similar program for government contractors. The federal government promises to pay contractors quickly if those companies in turn commit to rapidly pay the smaller firms that supply them.

The White House says that arrangement affected 172,000 small businesses and generated over $1 billion for them to invest and hire workers since it was launched three years ago. The president was due to renew that program on Friday as well as announcing the public sector initiative.

Other firms attending the White House event include CVS (CVS.N), FedEx (FDX.N), IBM (IBM.N), Lockheed MartinĀ (LMT.N), and Walgreens (WAG.N).

Honda (7267.T), Toyota (7203.T), Rolls Royce (RR.L), Ericsson (ERICb.ST), and Westinghouse (6502.T) are also among the corporate participants in the White House event.

(Reporting By Mark Felsenthal; Editing by Ken Wills)

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Comments (11)
JustProduce wrote:
Mr. President, hiring decisions are seldom made when cashflow statements improve. It is the P&L that drives hiring. But I guess that any photo op is better than nothing when you’re swimming upriver in public opinion polls. Stop campaigning. It is your regulation threats that has frozen the banking system. That is where the real fire power is. As soon as banks know that they will not be put out of business by you, they will begin releasing the fuel the economy needs. You would think the connection would be an easy one to make. Incredible.

Jul 11, 2014 6:55am EDT  --  Report as abuse
Everyone likes to get paid so I suppose that this isn’t a bad idea. Accountants have a term for this money: Accounts Receivable. If your small business is solvent I don’t see that this is a huge problem.

Why not just let the supplier draft a special account immediately on delivery of the product or service?

Jul 11, 2014 7:02am EDT  --  Report as abuse
Overcast451 wrote:
Oh, I’m sure big business is all behind their small business competitors.

**You can fool some of the people all of the time (partisans), and all of the people some of the time, but you can not fool all of the people all of the time.
~Abraham Lincoln
**

Jul 11, 2014 8:42am EDT  --  Report as abuse
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