Faced with mounting revolt by some of the nation’s top CEOs, President Donald Trump disbanded two business advisory groups Wednesday — lest the exodus swell into an embarrassing flood.
He didn’t have much choice. Not after members of his Strategy and Policy Forum — including General Motors Co. CEO Mary Barra — decided in a morning conference call to dissolve the group in the wake of the president’s controversial comments about last weekend’s Charlottesville protests.
“Rather than putting pressure on the businesspeople of the Manufacturing Council & Strategy & Policy Forum, I am ending both,” Trump wrote on Twitter, less than an hour after the head of the strategy forum, Blackstone Group LP’s Stephen Schwarzman, told the White House of the group’s decision to disband. “Thank you all!”
It’s the CEOs who should be thanking Trump. The festering controversy over his remarks promised to exact a heavy price on the business leaders, their companies and their reputations as critics across the political spectrum demanded unambiguous statements on the clashes in Virginia between white supremacists and counter-protesters.
The CEOs of Merck & Co. Inc., Under Armour Inc. and Intel Corp. quit Trump’s Manufacturing Jobs Initiative earlier this week, prompting the president to call them “grandstanders” whom he could easily replace. Campbell Soup Co.’s Denise Morrison and 3M Co.’s Inge Thulin left Wednesday.
What right-thinking CEO would actually want to replace them, considering the latest presidential Dumpster fire sparked by the Charlottesville backlash? Um, none. That sound you hear is boardrooms across the country heaving a collective, if private, sigh of relief.
“General Motors is about unity and inclusion and so am I,” Barra said in a statement. “Recent events, particularly those in Charlottesville, Virginia, and its aftermath, require that we come together as a country and reinforce values and ideals that unite us — tolerance, inclusion and diversity — and speak against those which divide us — racism, bigotry and any politics based on ethnicity.”
The strategy forum’s decision to disband is a stinging rebuke to Trump. It signals that the New York real estate mogul-turned-president is losing quickly the support of Corporate America, whose hunger for a more competitive business environment is surpassed only by its aversion to public controversy.
Credit the CEOs’ defection to the president’s recurring penchant for intemperate remarks, chiefly in the aftermath of Charlottesville, and the increasingly obvious fact that his promised agenda of health-care reform, corporate tax cuts and regulatory change mostly is stuck in neutral.
A simple cost-benefit analysis, the stuff of everyday business, reaches an obvious conclusion: Publicly consorting with a flailing president and his loose talk is bad for business, particularly when the cost in reputation and the risk of public pushback outweigh meager gains, so far, in economic reform.
With a few early exceptions, most of the business leaders stood by Trump through at least two iterations of immigration rules changes many of them did not endorse. Most stood by him when he unilaterally pulled the United States out of the Paris Climate Accord.
But his equivocation after Charlottesville — essentially equating white supremacists with counterprotesters — is an association contemporary business leaders simply cannot accept. Not in polite, respectful society, anyway, policed by social media and its bottomless well of outrage.
“Every member of the Manufacturing Jobs Initiative condemns racism and bigotry, and there cannot be moral ambiguity around the driving forces of the events in Charlottesville,” Dow Chemical Co. CEO Andrew Liveris said in a statement. “However, in discussions I had with the White House earlier today, I indicated that in the current environment it was no longer possible to conduct productive discussions under the auspices of the Initiative.”
The businessman president losing Big Business is not a good sign for the White House or the Republican majorities in the House and Senate. It suggests confidence is waning in the ability of the president, or his party, to deliver the economic goods as he careens from one self-manufactured controversy to the next.
That kind of behavior already would have gotten every CEO on the president’s two advisory panels canned by their directors — and every one of them knows it. The candidate who promised to win so much that winning would become boring is turning out to be the president squandering the support of business and the approval of voters, as a quick glance at RealClearPolitics can attest.
Sounds more like a loser. But he’s still president, and likely will be until at least January 2021. And that means many of the CEOs who opted this week to quit their presidential panels probably will have business interests and policy preferences before the administration Trump heads.
Take Barra’s GM and the rest of the Detroit auto industry. Even as business bolted, the administration this week began talks to renegotiate the North American Free Trade Agreement. It pledged to reinstate the promised “mid-cycle review” of federal fuel economy rules. And despite its failed attempt at health care reform, the White House and congressional leaders insist tax reform is coming.
We’ll see. What matters now is what the president does because what he says causes nothing but trouble.
Daniel Howes’ column runs Tuesdays, Thursdays and Fridays. Follow him on Twitter @DanielHowes_TDN, listen to his Saturday podcasts, or catch him 3 and 10 p.m. Thursdays on Michigan Radio’s “Stateside,” 91.7 FM.