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The myth of Donald Trump, CEO president

Donald Trump ran as America's first CEO president, one whose business skills made him uniquely qualified to ...

Posted: Nov 6, 2018 11:25 PM
Updated: Nov 6, 2018 11:25 PM

Donald Trump ran as America's first CEO president, one whose business skills made him uniquely qualified to run the world's largest economy.

Yet two years since Trump's election, it's clear the billionaire businessman has governed as the opposite of a modern CEO.

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Protectionism

Trump's CEO councils abandoned him in a rebuke to his incendiary comments on the violence in Charlottesville. He recruited executives to the administration, but they didn't fit in. ExxonMobil (XOM) boss Rex Tillerson was fired — by tweet. Goldman Sachs (GS) president Gary Cohn quit in the wake of Trump's imposition of protectionist trade policy.

Corporate America loves Trump's business tax cuts and deregulation, both of which have helped accelerate economic growth and send the bull market into overdrive.

But business can't stand Trump's populist instincts that have led to tariffs, a trade war with China and efforts to thwart immigration — despite a severe shortage of workers.

"Tariffs, trade wars and anti-immigration policies are anathema to business. They hate that," said Jeffrey Sonnenfeld, senior associate dean for leadership studies at the Yale School of Management.

Attacking business

Executives running America's biggest companies know that Trump could attack or demonize them at any time. The commander-in-chief has broken with precedent by attacking individual CEOs as well as some of America's largest employers.

Trump has gone after everyone from Amazon CEO Jeff Bezos to Merck (MRK) boss Ken Frazier, one of the nation's most prominent black corporate leaders. He attacked Harley-Davidson and the NFL. That's not to mention the almost-constant condemnations of the press, including CNN, the New York Times, NBC and the Bezos-owned Washington Post.

Trump is once again raising the prospect of cracking down on Silicon Valley. He has accused Google, Facebook (FB) and Twitter (TWTR) of trying to silence conservatives -- a claim all three companies deny. And Trump told Axios that his administration is looking into potential antitrust violations by Amazon, Facebook and Google.

Corporate America has quite the rocky relationship with what was supposed to be one of the most business-friendly administrations ever. Even though few major CEOs supported Trump in the general election, nor the primary, they mostly rallied around him after his victory.

CEOs like stability, not conflict

Trump promised a pro-business agenda and unity.

"I've spent my entire life in business, looking at the untapped potential in projects and in people all over the world," Trump said in his victory speech two years ago. "That is now what I want to do for our country."

But Sonnenfeld said executives have become "discouraged" by Trump.

"He stands for conflict — they don't like conflict. They like stability and social harmony," said Sonnenfeld, who is also founder and president of the Chief Executive Leadership Institute, a nonprofit focused on corporate governance that surveys CEOs.

Trump's leadership style is unlike that of almost any corporate executive, Sonnenfeld said. "It's like Vince McMahon became president of the United States."

Trade wars and inflation

Corporate America has gotten some things it wanted out of this administration.

Trump's tax cuts sparked a stock market boom in late 2016 and 2017 as well as record profits and stock buybacks this year.

He installed regulators and judges with a pro-business tilt. Corporate penalties have plunged, and regulators are moving to soften post-crisis rules imposed on banks.

But while Trump campaigned on his CEO cred, he also wrapped himself in populism and has governed in many ways antithetical to business.

The Trump bump in the stock market has started to fade as the buzz of the tax cuts' stimulus has lessened. After spiking in 2017, the market has become more turbulent. Investors fear that those same tax cuts may force the Federal Reserve to aggressively raise interest rates to prevent inflation from getting too hot.

"The economy really needs to slow to avoid a dangerous overheating," Jan Hatzius, chief economist at Goldman Sachs, wrote to clients this week.

That's why Goldman Sachs is calling for five more rate hikes from the Fed, or roughly two more than Wall Street is anticipating.

Likewise, corporate earnings calls are littered with complaints about tariffs and spikes for raw material costs. Trade war fears have contributed to market turbulence.

"The Trump administration's agenda in the first year was very pro-growth, and stocks reacted accordingly," Kristina Hooper, chief global market strategist at Invesco, wrote to clients. "The second year has seen an emphasis on policies that can run counter to economic growth — primarily protectionism — and stocks have posted very different returns thus far this year."

Now CEOs are wondering whether year three will bring back a return of pro-business Trump or if populist Trump will win out.

Minnesota Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 93012

Reported Deaths: 2040
CountyConfirmedDeaths
Hennepin26447926
Ramsey10697319
Dakota7354125
Anoka5935132
Stearns390924
Washington368955
Scott250033
Olmsted236728
Nobles195416
Blue Earth16476
Wright15737
St. Louis148039
Carver13897
Clay134040
Rice13228
Mower13125
Sherburne112514
Kandiyohi9722
Winona86318
Lyon6674
Waseca6128
Steele5332
Freeborn5323
Benton5303
Nicollet52116
Watonwan5164
Todd4872
Crow Wing48118
McLeod4752
Chisago4711
Le Sueur4524
Otter Tail4224
Beltrami4055
Martin37210
Goodhue3519
Pine3090
Itasca30314
Polk2984
Douglas2862
Isanti2790
Becker2642
Carlton2561
Cottonwood2240
Morrison2221
Dodge2180
Pipestone21710
Chippewa2061
Meeker1942
Sibley1863
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Brown1822
Yellow Medicine1752
Rock1640
Cass1593
Murray1582
Mille Lacs1543
Redwood1541
Unassigned15052
Renville1427
Jackson1411
Faribault1360
Swift1271
Houston1210
Koochiching1213
Kanabec1178
Roseau1170
Pennington1161
Fillmore1110
Lincoln1080
Hubbard941
Stevens941
Pope920
Big Stone760
Aitkin751
Wadena670
Wilkin613
Grant594
Lake580
Norman530
Lac qui Parle501
Marshall501
Mahnomen461
Red Lake421
Traverse290
Clearwater270
Lake of the Woods211
Kittson120
Cook60

Iowa Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 83644

Reported Deaths: 1294
CountyConfirmedDeaths
Polk15697261
Woodbury526363
Johnson508627
Black Hawk443688
Linn3941110
Story340517
Dubuque310141
Scott292628
Dallas275138
Pottawattamie206838
Buena Vista197212
Marshall177034
Sioux15043
Wapello131457
Webster121614
Plymouth110420
Clinton109920
Muscatine109154
Crawford10655
Cerro Gordo101821
Warren9486
Jasper81732
Des Moines7647
Marion7536
Tama70431
Henry6854
Carroll6535
Lee6207
Wright5721
Dickinson5086
Boone5008
Bremer4837
Washington45311
Louisa42815
Mahaska39119
Delaware3833
Franklin34618
Floyd3363
Jackson3303
Winneshiek3246
Hamilton3223
Clay3164
Lyon3074
Benton3061
Hardin2951
Winnebago28913
Poweshiek2788
Butler2672
Buchanan2651
Clarke2643
Jones2643
Emmet26010
Shelby2581
Allamakee2566
Kossuth2540
Chickasaw2470
Clayton2443
Sac2440
Guthrie2416
Cedar2381
Cherokee2352
Grundy2193
Madison2122
Fayette2112
Harrison2073
Iowa1981
Mitchell1880
Howard1866
Humboldt1843
Palo Alto1830
Calhoun1793
Hancock1772
Mills1771
Cass1602
Monroe15710
Pocahontas1562
Lucas1536
Page1530
Osceola1510
Monona1451
Jefferson1371
Appanoose1333
Union1283
Taylor1271
Davis1244
Ida1151
Van Buren1131
Fremont1100
Keokuk1051
Worth1040
Greene990
Montgomery905
Wayne852
Audubon811
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Decatur670
Ringgold492
Adams330
Unassigned40
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