Let the spending commence--slowly.

THERE ARE SIGNS of a new media campaign in the air. It goes like this: CEOs are sitting on lots of cash. They have a responsibility to start spending it aggressively to create jobs and keep the economic recovery going.

How droll. CEOs have been so thoroughly criminalized. Now they're supposed to step up and be heroes?

At the risk of reciting an already familiar litany, CEOs got badly burned by spending too much in the late 1990s and building up their cost structures. They fell victim to sudden impulses like Y2K and B2B. Then all the bad stuff (terrorism, stock market decline and scandal) started to happen and CEOs were forced to spend years cutting costs. It was nasty work.

Now, there's no question that profits have increased and CEOs are preparing to spend more on technology among other things, as our CEO Confidence Index this month revealed (see page 14).

But the psychological climate this time around is going to be very different. CEOs are going to be mistrustful of any sudden splurges. They don't want any more bubbles. They want to make sure that all spending is firmly linked to the underlying goals of their business units. They're going to be ROI fanatics. And they can't afford to make many expensive mistakes because they have to disclose significant business developments to the Securities and Exchange Commission, sometimes within a matter of days. That's the climate that Sarbanes-Oxley has created.

And here's a question: Where will CEOs spend when they start to spend? As so many have told us in our polling and in our meetings, they have deep concerns about the investment climate in the United States. That could tip many investments to flow to China or Mexico or India.

So the message to the folks who want the CEO cavalry to roll in and spend, spend, spend should be: Yes, we're going to start investing more--but we're going to be very careful how we do it and we're going to invest in those geographies that offer us the best rate of return. It's probably best for everyone concerned if CEOs undertake capital-spending projects with a keen eye on their bottom lines, rather than pay heed to broader societal or economic goals. That's a surer way for the U.S. to build real, sustainable economic growth over the long term.