If you run a big American company and you haven’t yet visited President Trump at the White House, you must be doing something wrong.
Trump hosts high-profile CEOs at the White House virtually every week, for strategy and policy discussions on how to turbocharge the US economy. This week’s guests included the CEOs of General Motors (GM), Boeing (BA), PepsiCo (PEP), BlackRock (BLK), IBM (IBM) and nearly two dozen other business leaders. Presiding over them was Steve Schwarzman, who runs the Blackstone Group (BX) investing firm and is Trump’s informal liaison to the business community.
Trump has gotten quite chummy with CEOs, after starting his presidency by picking Twitter feuds with companies such as Carrier (UTX), GM and Ford (F). He seems to have shifted strategy by embracing the business community and forming alliances with business people like himself, who in theory ought to be natural allies. At this week’s meeting, for instance, he addressed his guests as “an incredible group of world-class business leaders” while also claiming credit for just about every bit of good economic news since he took office in January.
A new format for CEO meetings
Trump’s early CEO roundtables were mostly photo ops in which the president sat at the middle of an oval table, flanked by CEOs all around. The new format is different. The White House now separates CEOs into working groups headed by Cabinet secretaries such as Wilbur Ross at Commerce, Elaine Chao at Transportation and budget director Mick Mulvaney. Then they work on policy matters relating to Trump priorities such as tax reform, regulatory relief and new infrastructure spending.
Trump seems to be moderating some of his economic views, and these meetings with CEOs might be contributing to that. Consider, for instance, a few of the things Trump the candidate vowed to do within his first 100 days as president: label China a currency manipulator; withdraw from the North American Free Trade Agreement, or renegotiate it; and impose tariffs on companies that move jobs offshore.
Trump has done none of those things, which is a relief to business leaders, because tariffs and other protectionist measures are widely viewed as the most dangerous moves Trump could make on the economy. The fact that Trump has so far spoken loudly on trade, but carried a small stick, is one reason stock markets have been buoyant during Trump’s first couple of months. The real prospect of punitive tariffs would end the Trump rally, as numerous CEOs have undoubtedly warned the president.
How Trump might be using his corporate friends
Trump seems to be using his corporate pals in two ways. First, he’s soliciting real advice from them about how best to structure tax cuts, streamline regulations and efficiently spend whatever money he’s able to raise for new roads and bridges. And second, he’s lining up corporate support for legislative battles likely to be tougher than Trump probably expected, giving his stinging setback on a health care bill that couldn’t even make it to a vote.
Asking CEOs and 1 percenters to help rewrite policy is not exactly the populist, swamp-draining crusade Trump promised his most ardent followers. But they don’t seem to mind, instead siding with Trump’s claim that unleashing businesses is the way to raise up a struggling middle class. For now, Trump’s promises on that seem to be good enough.
At some point, Trump will need real wins to demonstrate that hobnobbing with potentates somehow helps ordinary people — through stronger wage growth, better opportunities and more optimism. But for now, he’s actually enjoying a sort of mini-honeymoon: Supporters are giving him time to produce results, while some of the world’s most powerful business leaders sit in obeisance while Trump holds court. It may be the only place in Washington, DC where everybody gets along.
Rick Newman is the author of four books, including Rebounders: How Winners Pivot from Setback to Success. Follow him on Twitter: @rickjnewman