Corporate America and its CEOs are finally divorcing Trump

But the relationship worsened when Trump failed to condemn racism, attacked large U.S. companies, ignored the climate crisis and imposed tariffs. And this week’s divorce ended dramatically after Trump urged an angry mob to attack the American Capitol.

Both parties took a completely different tone this week: The uprising in front of the American Capitol, the symbol of American democracy, turned out to be the last straw that broke the camel’s back.

The Business Roundtable has criticized American politicians for broadcasting fiction about election fraud and warns that this is a danger to democracy and the economy. Major CEOs have condemned the violence.

And in perhaps the strongest political statement by a large business group in modern history, Timmons – a former GOP agent – called on Vice President Mike Pence and the cabinet to consider ousting Trump: It’s chaos. It’s the rule of the mafia. It’s not safe. This is an uprising and should be treated as such.

But critics say that business leaders should have condemned the deception much sooner and, in a way, made it possible.

There is a lesson in not standing up to bullies, says Eleanor Bloxham, CEO of Value Alliance, a company that advises boards on corporate governance. By appealing to the asset, they have afforded themselves a very narrow and not long-term perspective.

Senator Sherrod Brown, the most influential Democrat in the Senate’s Banking Committee, has proposed a favorable divorce decree.

These executives have received all their tax benefits, deregulation and business-friendly judges. They don’t need an asset anymore, so they can finally do the right thing, Brown said in an interview with CNN Business Thursday. It’s a good thing they had the courage to do this, while there are only 13 days left in the Trump administration.

Oh no, Assets

To be honest, the relationship between Trump and Corporate America has always been full of ups and downs. And the leaders provided exciting moments of moral leadership during the turbulent times of the trump card.

Initially, large companies did not support Mr. Trump’s candidacy.

There seemed to be a feeling in the primaries: Oh no, Trump, Bloxham remembers his talks with Republican board members in 2015 and 2016 in general.

After Trump’s appointment, many managers joined Hillary Clinton.

They never considered him one of them, says Jeffrey Sonnenfeld, founder of the Executive Leadership Institute at Yale University. Mr. Sonnenfeld remembered that some executives who are now active as CEO were in danger of leaving when he took Mr. Trump to an economic summit around 2006.

Wait, is there a tax cut?

But when Mr. Trump won the White House, industry saw him as the driving force behind the business-friendly measures he asked for – including tax cuts.

In January 2017 there was a lot of excitement. He spoke their language, Sonnenfeld said. The business community was very enthusiastic.

By the end of 2017, Trump will create a thriving economy by implementing the massive corporate tax cuts promised by the White House.

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The Business Roundtable has made an agreement with the devil, according to Sonnenfeld.

Trump’s tax cuts had a greater impact on Wall Street than Main Street. The long-term acceleration of job-creating investment has never been realised, which has mainly led to share buybacks, dividends and mergers. At the beginning of 2019, economists at Bank of America discussed an investment boom that was not an investment boom.

In addition to the tax cuts, Trump ushered in a wave of deregulation that the economy demanded from the Obama administration after eight years. And he appointed pro-business judges, including three conservatives, to the Supreme Court.

They got most of what they wanted, said Ed Mills, a political analyst with Raymond James in Washington.

Race, climate and immigration disputes

But in the summer of 2017, the relationship began to deteriorate.

First, business leaders including former Disney (DIS) chief Bob Iger and Tesla (TSLA) chief Elon Musk have overturned Trump’s decision to withdraw the United States from the Paris Climate Agreement.

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And then, in August 2017, CEOs led by Merck (MRK) chief Ken Frazier left Trump’s business panels after the president initially failed to convict white supremacists at a meeting in Charlottesville, Virginia. In the end, the advisory committees were disbanded and the chairman was given a surprise reprimand.

You don’t want to be on the wrong side of the story, Sonnenfeld said.

Silicon Valley and other large U.S. companies have also repeatedly resisted Trump’s immigration restrictions, particularly the Dreamers, Sonnenfeld. He said that business has been one of the strongest voices in the fight against the extreme measures taken by the Trump administration, such as B. immigration.

Too toxic?

The question now is whether business leaders will support the Trump movement after the end of its mandate on the 20th. January.

Trump and his surrogates have promised to launch well-funded primary challenges for incumbent Republicans who refuse to support his attempt to overthrow the elections.

You’ve interested a lot of Republican businessmen: I’m going to hang on to this move because it’s still low tax and energy friendly? said Michael Chambalet, chairman of market and investment strategy at JPMorgan Asset Management, in an interview for Capitol Hill on Wednesday.

On the other hand, there are many other things related to the Trump movement: Anti-trade, intense anti-immigration, and perhaps a degree of authoritarianism that disagrees with the party, he added.

Bloxham, CEO of Value Alliance, said that much will depend on whether or not Mr Trump faces serious consequences before his term expires, such as an indictment or a reference to the 25th Amendment. Constitutional change.

If there is a strong reaction, said Bloxham, the Trump brand will be much more toxic.