They absorb lots of LW, and much of this gets re-radiated back to the surface. Essentially, energy is being recycled between sky and ground. This has profound consequences for the biosphere. Clouds also participate in the greenhouse effect, but they are opaque and behave as non-selective absorbers. Hence, they close off the atmospheric window and trap in even more heat energy.
Clouds provide a nice illustration of the concept of feedback within a system.
Feedback occurs when flows of energy or matter in a system influence the basic operation of the system. Net radiation is determined by inputs and outputs of solar and terrestrial radiation. As a global, long-term average, incoming energy must equal outgoing energy. Otherwise, temperatures would be progressively increasing or decreasing. In daytime, net radiation of a surface is generally positive, dominated by incoming solar radiation.