Reuters reports: "Dow Chemical Co, the largest chemical maker in the United States, said on Tuesday it plans to cut 5 percent of its workforce and shutter 20 plants...the cuts would result in a loss of around 2,400 positions worldwide....The company will also take an unspecified charge related to its Dow Kokam LLC assets, reflecting weak demand for lithium-ion batteries."
Some context from a January 24, 2011, post at FutureOfCapitalism, "Obama's Second-Favorite CEO":
If there's a runner-up to GE's Jeffrey Immelt for the title of President Obama's favorite CEO, it might be Dow Chemical's Andrew Liveris. The Wall Street Journal reviews Mr. Liveris's new book, Make It in America, without any mention at all of the Obama connection. The Journal says Mr. Liveris "thinks that the U.S. government needs to draw up a national strategy to encourage more manufacturing, especially in renewable energy and other 'green' technologies." Also, "Mr. Liveris would like see the federal government offer financial incentives to various companies—beyond what is already dangled by state and local agencies—to encourage manufacturers to build factories in the U.S."
In November 2009, President Obama named Mr. Liveris to the U.S.-India CEO Forum and invited him to a meeting at the Treasury Department with Secretary Geithner and Lawrence Summers. In July 2010, Mr. Obama appointed Mr. Liveris a member of the President's Export Council. Last week, Mr. Liveris, like Mr. Immelt, was invited to the White House to meet with President Obama and Chinese leader Hu Jintao, and Mr. Liveris, like Mr. Immelt, stayed for the state dinner.
Is it just a coincidence that all these CEOs hanging around Mr. Obama want things — "a national strategy," "financial incentives" — beyond simply a government that treats every business the same way? Certainly the traits rewarded by these sorts of government-bestowed preferences for businesses include some, such as the ability to gain access to government officials, that these big-company CEOs seem to have in abundance.
In a February 7, 2011, speech to the Chamber of Commerce, Mr. Obama announced, "Dow is building a new plant in Michigan to manufacture batteries for electric vehicles." This site noted at the time, "The Michigan battery plant the president mentioned was made possible with $42 million in state tax credits from the Michigan Economic Growth Authority, small consolation to those Michigan small businesses and individuals who are paying their tax bills in full because they don't have the political clout of Dow or they don't work in a politically favored industry." The Reuters dispatch today reports that among the factories Dow plans to shutter is "a manufacturing facility in Midland, Michigan."
Anyway, it's sad to see Dow laying off workers, but it's somewhat reassuring that having a CEO who is pals with the president can only take a company so far. Sometimes the government-centered corporate strategy is a substitute for a strategy that doesn't depend on government assistance for business growth.