When I chatted with Steve Forbes, the gregarious chairman and CEO of Forbes magazine, while he was in town a couple weeks ago, I reminded him that we’d met a few years before, during one of his campaigns for president.
At that time, at a hotel in Washington, D.C., he’d poked fun at the then-new illustrations on our paper currency. He’d pulled some bills out his pocket to show me how cartoony he thought our former presidents appeared in their latest renditions.
Then as now, the man who by some estimates carries a net worth of $430 million has stuck to his basic beliefs: Economic stability is serious stuff.
Forbes chuckled at the recollection when we talked at the Hotel at the Kirkwood Center. He again dipped into his pocket for some show-and-tell.
“See?” he asked. “They still look silly.”
Forbes, along with John Schlifske, chairman and CEO of Northwestern Mutual, were in the Corridor on Sept. 12 to visit University of Iowa students in the afternoon and to press the flesh with business folk in Cedar Rapids in the evening.
In our conversation, I asked them — as observers of and participants in the big picture — what businesses should do to prepare for the threat of the impending fiscal cliff. (After all, like a car wreck, you can’t wait until it happens to begin thinking about how you’ll protect yourself against it.)
“Well, I’ll tell you what we’re doing,” Schlifske replied without a moment’s hesitation.
Northwestern Mutual is conserving its resources and placing “no major bets” these days, he insisted. The life insurance and financial services company, which he noted boasts some $170 billion in 2012 assets, is doing all it can to maintain its triple-A rating.
Companies, Schlifske advised, need to be “ruthless” in what projects to greenlight.
They “have to play offense and defense at the same time. And that’s difficult to do.”
“We’ll see more this from businesses as the cliff becomes more of a possibility,” Forbes suggested. “More businesses will stay on the sidelines.”
But what if the boogeyman doesn’t come, I asked? What if those people we elected to run our government make some sense of the gigantic spending cuts — $100 billion across thousands of federal programs, according to CNN Money — and of the taxes set to take effect at the beginning of 2013?
“You have to plan for both,” Forbes answered almost with a patient sigh.
The so-called fiscal cliff, though, isn’t our only challenge, Schlifske said, picking up the thread.
“What is a complete certainty is that the leadership in Washington is not dealing with the issues,” the insurance chief said, ticking off health care and Social Security as just two massive funding concerns. “How are we going to pay for everything — no matter who wins?”
Despite these worries, Forbes and Schlifske — decision-makers comfortable with big numbers, after all — injected a strong note of optimism during their panel discussion later that evening in the hotel ballroom.
No matter what, Forbes said, the United States will weather this “unnecessary financial crisis” and “we’ll get back to good times.”
Innovation is our key to success. America, Schlifske reckoned, “has a very bright future.”
So we need to be scared. But maybe not that scared.