Trump gets chummy with CEOs
You probably won’t hear much, if anything, about President Trump’s latest meeting with business leaders. He didn’t make the sort of threats that have sent targeted stocks reeling in the past, and nobody had to defend a plant in Mexico or an unseemly price hike. But Trump may be signaling a conciliatory new approach toward CEOs while acknowledging he needs their help amid legislative setbacks, continual scandal and abysmal approval ratings.
Trump spoke before roughly 50 CEOs at the White House on April 4, part of an ongoing dialogue with business leaders managed by Steve Schwarzman, CEO of the Blackstone Group, the giant private-equity firm. The gathering included top execs of Citigroup, Mastercard and the New York Stock Exchange, among others, along with Trump’s fellow developer, Jerry Speyer, who is leading an advisory group drawing up recommendations for a huge infrastructure program.
Trump came into office sparring with CEOs, especially manufacturing bosses he accused of shipping millions of jobs overseas. Some of Trump’s earliest meetings as president were showcases for him to criticize companies such as Ford and General Motors for building plants in Mexico. He met with pharmaceutical CEOs while insisting drug prices are far too high. A meeting with the CEO of Boeing gave Trump the opportunity to claim (dubiously) that he knocked $1 billion off the cost of the next generation presidential jet in an hour’s worth of negotiation.
But Trump seems to be softening his aggression toward CEOs, indicating that his agenda for corporate America may be moving into a new phase and Trump himself may be settling down after a notoriously rocky start to his tenure. Trump’s modus operandi, up till now, has been to demand that American companies do more to create jobs, and tweet-slam a few poster-corporations until he gets results. This has been his method with Ford (F), GM (GM), Carrier (UTX), Fiat-Chrysler (FCAU), Toyota (TM), Rexnord (REX), Boeing (BA) and a handful of other companies that have landed in his crosshairs for whatever reason.
Most of these companies figured out how to get in Trump’s good graces: Announce some new plan to invest in America and create new jobs, even if it’s a rehash of things the company said it was doing before Trump ever got on their case. Trump has generally responded by declaring victory, tweet-thanking the company for listening to him and claiming credit for every new job on the way.
Trump now seems to be moving beyond the tweet-threat strategy, by enlisting CEOs as allies straightaway instead of setting them up as adversaries for him to conquer. At the April 4 forum, for instance, he told CEOs of his grand plans for slashing regulations, cutting taxes and freeing business to break the nation out of an economic rut. “We are absolutely destroying these horrible regulations that have been placed over your heads for the last 25 years,” Trump said from the stage of a small White House auditorium. “We want clean air and we want clean water, but we shouldn’t have to get approvals from 16 different agencies for almost the same thing.”
There’s an element of theater to almost everything Trump says publicly, so we may be seeing nothing more than the natural affinity Trump feels toward fellow businesspeople who have to tangle with the government much as he has during a long career as a developer. But Trump suddenly needs as many allies as he can get in Washington, and he may no longer be able to afford manufactured conflicts in which he sets up CEOs as foils knowing he’ll find common cause with them (or vice versa) when the time is right.
Trump’s bungling of the Republican Obamacare replacement was a fiasco that raises doubts as to whether Trump can accomplish any part of his agenda. His tough-guy executive orders on immigration have been rendered impotent by the courts. The biggest question in financial markets right now is whether the “Trump trade” has peaked less than 100 days into the new president’s term.
So Trump’s softening attitude toward CEOs may indicate a tacit awareness by the president that he needs to stop playing games with corporate America and instead harness its considerable power to his political agenda. That would probably be shrewd on his part. Bashing CEOs might generate a few populist headlines, but Trump needs their help if he wants to accomplish more than posting a few triumphant tweets.
Related:
Trump’s best and worst tweets as president
Trump’s absurd claim about the US labor force
Rick Newman is the author of four books, including Rebounders: How Winners Pivot from Setback to Success. Follow him on Twitter: @rickjnewman