I've Just Cut My Last Tie to GE.

I just sold my GE stock. I'm a former employee of GE, or a refuGE as I sometimes like to call myself. I had a number of shares that I accumulated in my 401K while I was working there and subsequently moved to a Rollover IRA. Ever since Jeff Immelt took over the tiller from Jack Welsh, the stock has gone sideways or down and I believe the first commenter to this opinion piece at the Washington Examiner about the hiring of Linda Daschle as a lobbyist has summed up what GE has become quite well:

"GE has become the perfect example of a so called capitalistic company engaging in pure rent seeking. They want Congressional subsidies for things like wind mills and others of their product lines. "

The opinion piece details some of the other government entanglements:

General Electric, a top-20 source of funds for Obama in 2008, and owner of the Obama-friendly MSNBC, already has strong ties to Democrats, but the company has bolstered that relationship, according to recently filed federal lobbying registrations
.

GE's transportation business has hired as a lobbyist Linda Hall Daschle, wife of Tom Daschle, the former Senate Democratic Leader and Obama's first pick to head the Department of Health and Human Services. Mrs. Daschle will lobby on issues including Amtrak, high-speed rail, and freight rail, the lobbying form says. Obama has declared support for added federal funding for high-speed rail.

GE is also a member of the U.S. Climate Action Partnership, which lobbies for restrictions on greenhouse gas emissions.

When Jack Welsh took over as CEO of GE back in 1980 he had a fairly simple philosophy for running the various GE businesses; you were either number one or number two or have a plan for getting there pretty quickly in whatever line of business you were in. Otherwise, you got out of that line of business. It was a focused, effective management philosophy and the market rewarded GE for it for many years with a healthy stock price. What should have been added to that basic formula is that you had to be number one or number two without government subsidies. If the business isn't meeting market share and return requirements without a government subsidy, it isn't a business a company should be in because government involvement distorts decision making. GE is becoming excessively entangled with government and I think the market has been reacting to that. As I don't see this situation changing any time soon, I finally decided that it's time to redeploy my capital elsewhere.