Friday, July 29, 2011

Home Depot Co-founder Langone: Obama's 'Unpresidential' Behavior Destroying Economy, Country

The United States will work its way through the debt ceiling crisis and probably avoid a default but President Barack Obama's "unpresidential" behavior during the process has fueled division and suspicion to the extent that the damage of his actions will endure, says Home Depot co-founder and former New York Stock Exchange director Ken Langone.

"He's not bringing us together. He's willfully dividing us. He's petulant," Langone told CNBC.

"This guy worked like hell to be president ... Behave like a president. Let me look to you as a model of how we should behave. So what does he say: fat cats, jet airplanes, what's the purpose?"

President Barack Obama
(Getty Images photo)
That purpose, Langone says is to divide the nation by accusing others of not doing their fair share to contribute to the country's finances, said Langone, now chairman and CEO of investment bank Invemed Associates.

"Divide us and we all lose. And this has got to stop. And if he's listening, or one of his people are listening, and you can quote me exactly for what I say, he is not acting presidential, he is behaving in a way designed in my opinion  to divide us and make us look at each other with skepticism, with suspicion. That's the end of America as we know it when that happens."

Turning to the debate over lifting the government's $14.3 trillion debt ceiling to avoid default, Langone says both sides of the political spectrum will agree to lift it.

"The deficit, we're going to get through, the debt limit, it will all come through. The destruction he is inflicting by his behavior will carry on long after we have settled the debt limit," he told CNBC.

Republicans and Democrats in Congress are at odds over ways to narrow deficits in exchange for agreeing to raise the government's borrowing limit, with the former opposed to tax hikes and the latter opposed to certain spending cuts.

Langone, meanwhile, says he shouldn't receive Social Security due to his immense wealth but says those like him should expect responsible fiscal behavior in return for the taxes they pay.

"I should not get Social Security. I think it's a travesty for a man of my success and of my means to get anything from the federal government. I think I should pay more taxes ... but everything they take from me" should go to reduce the debt.

Other financiers have criticized what they see as presidential scare tactics.

"Scaring senior citizens about the possibility of not receiving their Social Security and Medicare checks, lambasting the corporate jet industry, and calling for higher taxes on managers of private partnerships is not a constructive approach to handling a multi-trillion dollar problem that will have a multi-generational impact," says hedge fund manager Dan Loeb, according to Dealbreaker.

"It's increasingly difficult to avoid that conclusion that while Washington burns, President Obama is fiddling away by insisting that the only solution to the nation's problems — whether unemployment, the debt ceiling or deficit reductions — lies in redistribution of wealth."

Ratings agencies say they may strip the United States of its AAA credit rating if default occurs, which would prompt investors to demand higher interest rates on government debt due to the increase in perceived risk. That would carry over to financial markets across the country, thus increasing interest rates for borrowers everywhere.

Still, says one economist at Standard and Poor's, one of the ratings agencies, don't expect chaos to ensue.

"It's not good but I don't think it's the end of the world" if the United States's credit rating is downgraded, Mark Zandi, chief economist of Moody’s Analytics, tells Good Morning America.

Plus if the Washington works out its deficit issues, sunnier skies could return, Zandi adds.

"These things aren't written in stone. We can get that triple-A back if we do the right thing."

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