Considering the pragmatic nature of CEOs, I had my doubts about the sincerity of sudden mass volte-face, since they knew about Trump prior to coming joining the council...
CEOs Flee Trump Because He's Useless to ThemTension between business leaders and presidents is hardly new. Wall Street disliked President Barack Obama, partly because he pushed for the Dodd-Frank financial regulation act, but more because he didn't treat them with the deference they thought they deserved. ("My administration is the only thing between you and the pitchforks," he told bankers during the financial crisis.) President Jimmy Carter's inability to halt inflation or hold down interest rates created enormous dissatisfaction.
And of course Franklin Delano Roosevelt was loathed by big business, which saw the New Deal as shackling free enterprise. One anti-Roosevelt effort, a propaganda organization called the American Liberty League, was funded in part by the likes of Alfred Sloan of General Motors and the DuPont family. They were the Jeff Immelt and Jamie Dimon of that era.
But what is happening now between Trump and corporate America is different. Businessmen turned against Roosevelt because they feared him, as they had good reason to do. He knew how to pull the levers of power--how to create a Securities and Exchange Commission, for instance, and push for the passage of the Glass-Steagall Act, which separated commercial banking from investment banking.
When Trump started running for president, the business community had a leg up in understanding him. Some had done deals with him, or had attended galas that he also attended, or had shot a round of golf with him at one of his resorts. They knew he was crude, narcissistic and only out for himself. And having watched the collapse of his casino business in the early 1990s, few had much respect for his business skills.
But they also thought that having a businessman in the White House would be, well, good for business. Infrastructure to build! Tax cuts! Dodd-Frank repeal! Regulations eliminated! They also learned that Trump was malleable. After hammering the pharmaceutical industry over high drug prices, Trump held an early meeting with a group of pharma CEOs. He came out of the meeting with a statement that was not nearly as harsh and that complimented the industry for its "extraordinary results for our country."
So of course most CEOs said yes when they were asked to join one of his councils. Trump pulled out of the Paris climate accords, and most of them stayed. (Disney's Robert Iger and Elon Musk were exceptions.) Trump fired James Comey from the Federal Bureau of Investigation, and they stayed. Trump made an absurdly partisan speech to the Boy Scouts and they stayed. Even once they realized the council meetings were a waste of time, they stayed. Many of them took the view that it was a good idea to keep a "seat at the table."
So what changed? Yes, Trump's incendiary press conference on Tuesday made most corporate executives uncomfortable. But if they still felt that Trump had the power to help get their agenda through Congress, most of them probably would have stuck with him.
But they've come to realize that Trump is not going to be of any use to them. He is never going to get anything through Congress, which now shrugs when he demands action. His one legislative push, repeal and replacement of his predecessor’s signature health-care program, was a political disaster that has largely eliminated the chances for, say, an infrastructure plan. (Indeed, the S&P 500 Construction and Engineering Index is down 20 percent since Trump became president.) His idea of lobbying is to send out bullying tweets. He couldn’t even intimidate his own attorney general, Jeff Sessions, who showed not long ago that Trump’s blustery tweets have no consequences if you ignore them. Trump truly is the little man behind the curtain, pretending to be the Wizard of Oz. Business gets that now.
Posted: Fri Aug 18, 2017 12:34 am