The State of the Union: Fractured Social Fabric and Little Chance of Advancing Any Meaningful Legislative Reform

Posted on August 17th, 2017 in Uncategorized by Karl

Great Analysis from Alan Murray, Fortune CEO Daily. 8/17/17.

President Trump disbanded his two main business advisory councilsyesterday—but only after they had disbanded themselves. The CEOs agreed that they could not continue to be effective, given the controversy that surrounded them. “We have always believed that dialogue is critical to progress,” IBM CEO Ginni Rometty subsequently wrote to her employees, but “this group can no longer serve the purpose for which it was formed.”

A few facts:

-One group’s members made the decision on their own to disband, then informed President Trump of their decision. He then preempted them by tweeting he was ending both councils.

-Several of the CEOs were ready to resign if the group wasn’t disbanded.

-Dissatisfaction among the CEOs had been growing since the president’s decision to pull out of the Paris agreement in June, and the group has been largely dormant since. The social media campaign against some of themadded to concern, but was not the primary cause.

-While the president accused the CEOs who resigned of “grandstanding,” in fact the opposite is true. Virtually all of the CEOs were eager to avoid controversy, for the sake of their businesses.

With his ambiguous response to the unambiguous situation in Charlottesville, President Trump has now completed his alienation of the congressional leadership of his own party, his top military leadership , and his top allies in the business community. Were some anti-fascist protestors in Charlottesville carrying clubs and looking for a fight? Yes. Were some good people opposed to removing the statue of Robert E. Lee? Of course. Did press coverage oversimplify the situation? Always. But the racist and anti-Semitic origins of the Charlottesville rally were unmistakable, and the president’s reluctance to call them out was a fundamental failure of leadership.

Several CEO Daily readers have written over the past three days urging me to keep politics out of this newsletter. Would that I could. But having spent three decades covering business and politics, there is no doubt in my mind that this week’s events have not only fractured the social fabric of our nation, but also greatly reduced any chance that the president and Congress have of enacting serious legislative reforms. What began seven months ago as a once-in-a-decade opportunity for a Republican-led government to make progress on health care, infrastructure, taxes, and American competitiveness has descended into disorder. There is blame to go around for that—unsteady congressional leadership, an overzealous press corps, a determined political opposition, gun-shy CEOs. But here, as in Charlottesville, the principle source of the problem is unambiguous.

The CEOs I talked with said they will continue to engage with the administration. Many are close to Gary Cohn and Dina Powell in the White House, or cabinet officers like Steve Mnuchin, Elaine Chao, Wilbur Ross, Bob Lighthizer and others. They still feel they can get a far better hearing on their economic concerns from this administration than from the previous one, which they felt was often hostile to business.

But the fact that the nation’s leading CEOs feel they can no longer work openly with the president of the United States on measures to strengthen the U.S. economy is a sad—and unprecedented—state of affairs.