Kerry's key to the White House

TO THE business community, Edward Breen has done well in his two years as chairman and chief executive of Tyco International. He fired the board that appointed him to take over from his criminally-indicted predecessor and restored profitability. Tyco's share price is around three times higher than its 52-week low.

But to Democrat Presidential candidate John Kerry, Breen is not a corporate turn-around specialist. He is a traitor. He is 'taking' $400m (£222m) annually from the tax coffers. He has sacked 11,000 workers. And, though it is all perfectly legal, Breen, according to Kerry, needs to be stopped.

Welcome to US Presidential Politics 2004, where business, commercial ethics and the economy lead the agenda with eight months to voting day.

In campaign speeches, Kerry lambasts Breen and Tyco, calling them a Benedict Arnold chief and corporation. (For the uninitiated, Arnold was an infamous US traitor at the time of independence who betrayed his country for a rumoured £10,000 and a commission in the enemy British military).

Benedict Arnold chiefs are those, according to Kerry, who betray America by taking advantage of tax loopholes to incorporate their companies in havens such as Bermuda to avoid paying their fair share to the Internal Revenue Service.

Kerry has vowed to close such loopholes to firms whose executives and offices are all in the US.

Earlier this week, he was honing his economic message to an audience in Tampa, Florida. It is evident he and Republican President George Bush are miles apart on such issues.

On the surface, Kerry is no Clinton/Blair-type socialist, bringing the party to the centre to curry favour with the business community and wealthier voters.

Yet despite his anti-business rhetoric, Kerry insists: 'I'm an entrepreneurial Democrat and I believe creating jobs and growing business is good for America.î Democrats can't love jobs and hate the people who create jobs.

He just wants business leaders to play by the rules. Billionaire investor Warren Buffett implicitly backed the Democrat last weekend when he blasted Bush over tax cuts for large corporations and their investors. Shares in his Berkshire Hathaway holding firm have gone up nearly 50% in the past year to $95,000. In the company's annual report, he wrote: 'If class warfare is being waged in America, my class is clearly winning.

In his second tilt at the Presidency, Kerry has a full quiver of economic arrows to fire. The one that lands closest to the bullseye with voters is his promise to create more jobs in the US and discourage companies from outsourcing to foreign countries.

Data shows 2.2 million jobs, most in manufacturing, have disappeared during the Bush years. Recession and 9/11 were primary causes, but jobs growth was just 21,000 in February, despite the supposed stimulus of tax cuts. Observers say Bush is vulnerable on this issue and Kerry has pounced.

'The one person in the United States who deserves to be laid off is George W Bush,' he told supporters in Tampa.

Kerry says he will provide new tax breaks to firms that make goods and create jobs in the US. He is getting surprise help from the Republican-dominated Congress on outsourcing and trade globalisation.

In the House of Representatives and Senate, there are lots of angry politicians facing re-election themselves, unhappy with job losses among constituents. Chatter about proposed anti-outsourcing laws has quickly generated a response from worried business groups. Some have formed a Washington coalition to beat back any legislation that would, for instance, restrict foreign outsourcing by government contractors.

The usual suspects

THE REST of Kerry's jobs platform is filled with left-leaning favourites; a rise in the minimum wage, closing the pay gap between the sexes and making college affordable for all. To fund these, Kerry says he will roll back some of Bush's tax cuts, targeting big business and people earning more than $200,000 a year.

Republicans equate tax rollbacks with tax increases and that opens up Kerry to claims that he is another a tax-and-spend liberal Democrat.

That said, his plans to halve the budget deficit by curbing Government spending could easily have come from the lips of a pre-Bush Republican.

His manifesto includes a requirement that federal agencies cut energy costs 20% by 2020; that federal admin costs fall 5%; and that fraud, estimated to run at $12bn in Medicare alone, is eradicated.

In another dig at the business community, Kerry plans to end corporate welfare - another name for tax breaks for special interests. He will also trim pork-barrel spending by politicians for pet projects in their states - a practice that has become rampant in the past two years. Two of the business sectors that have had, more or less, a free rein under Bush, have been energy and healthcare.

They too are targeted in Kerry's reforms.

Energy conservation has seemed a near-alien concept to the Bush Administration which tried, mostly unsuccessfully, to drill for oil in environmentally sensitive places such as Alaska and the Gulf of Mexico. Kerry plans to curtail dependence on oil, particularly from the Middle East. He would develop renewable energy, creating an estimated 500,000 jobs over the next decade and work toward deriving 20%of US energy from such fuels by 2020.

Critics of Bush point out that health costs are rocketing and ever more people are without cover. Medical insurance is often cited as a reason US companies, especially small ones, do not want to hire full-time workers. Kerry aims to expand insurance plans, already in place for federal government workers, to cover everyone and believes he can make it affordable for businesses and individuals.

Republicans laugh off much of his agenda as unaffordable, and there are plans for a faux federal budget based on Kerry's assumptions to show how it does not add up.

But what of Breen and Tyco? All is not quite sanguine in the New Jersey offices of the Bermuda-based conglomerate.

Earlier this month, 25% of shareholders voted against a board motion to keep it in Bermuda, forcing executives to say they will look more closely at returning to the US.

As for Kerry's complaints about the company, Tyco says it has a US payroll of $5.4bn for 100,000 staff and pays millions in US sales, property and payroll taxes, which generate revenue for federal, state and local government.

'The facts speak loudly of our commitment to this country,' concludes spokesman David Polk.

Try telling that to Kerry.

Divided Florida's vital role again

FLORIDA may again play a key role in deciding the Presidential race. A new poll shows Kerry leading Bush 49% to 43%.

Just 3% say they will vote for independent Ralph Nader but, with eight months to go, only 5% of the electorate says they are undecided in the politically polarised state.

Back in 2000, Bush won the hotly disputed Florida election by little more than 500 votes, giving him overall victory over Democrat Al Gore.

In the latest survey, a majority of voters disapproved of Bush's handling of the economy - one of the top issues - and they said the country is heading in the wrong direction.

Experts expect the polls to flip-flop between now and November - and another very close race.

'Florida is in play. This poll clearly demonstrates the state that gave us drama and nail-biting in 2000 is no different in 2004,' says pollster Kellyanne Conway.