The honeymoon is definitely over.
New York, United States | AFP | In June, optimism among American CEOs was at a three-year high on hopes that US President Donald Trump would succeed in implementing his pro-growth agenda, including tax cuts.
But this week, Trump has lost support from four executives who left an advisory panel on manufacturing over his response to a violent white supremacist rally in Virginia — a sign that big business is disenchanted with the billionaire leader.
Scott Paul, the president of the Alliance for American Manufacturing, on Tuesday added his name to a list of defectors that also includes the heads of Merck Pharmaceutical, Under Armour and Intel.
“It’s the right thing to do,” Paul said on Twitter.
Trump, never one to shy away from controversy, fired back.
“For every CEO that drops out of the Manufacturing Council, I have many to take their place,” he tweeted.
“Grandstanders should not have gone on. JOBS!”
But there was a definite feeling that other shoes were ready to drop.
“CEOs quit Trump’s Panel: Who’s Next?” asked a headline on Bloomberg News television.
– To leave or not to leave? –
In the early days of Trump’s presidency, which began in January, all the signs from big business were positive.
The Manhattan real estate tycoon-turned-world leader ran as a friend of the business community who pledged to enact tax cuts, streamline regulations and take other steps to boost growth in the world’s biggest economy.
The Business Roundtable’s CEO Economic Outlook Index published in June, which measures corporate spending and hiring plans over the next six months, rose to 93.9 for the second quarter, the highest since the same period of 2014.
“I know the vast majority of (CEOs) believe that really positive tax reform remains more than possible,” Business Roundtable president Joshua Bolten told reporters.
Of course, Trump’s business agenda has faced other obstacles during his six months in office, and it was not clear that a downward turn in his popularity among blue-chip industry leaders would hinder his progress.
But executives are certainly facing a tough choice on whether to stay in the camp of a president with overall low approval ratings — but a passionate following among a majority of Republican voters and tax plans they favor.
For some, the choice was clear.
“After this weekend, I am not sure what it would take to get these CEOs to resign,” former Treasury secretary Lawrence Summers, a Democrat, wrote in a Washington Post commentary.
“Demonizing ethnic groups? That has happened. Renouncing international agreements that have supported business interests? That has happened. Personal profiteering from the presidency? Also happened. Failure to deliver on ballyhooed promises? That has happened as well.”
Activists are aggressive on both sides on the issue.
The anti-Trump Grabyourwallet — which boycotts companies that sell Trump products — regularly prods its 62,300 Twitter followers to email companies that still have CEOs on White House panels.
On the conservative side, groups like the National Center for Public Policy have lambasted executives for criticizing Trump.
Last year, PepsiCo faced a brief boycott after chief executive Indra Nooyi publicly rued the election result shortly after Trump won last November. She later joined a White House advisory panel.
This week, Nooyi and other several prominent executives, including JPMorgan Chase chief Jamie Dimon, condemned the racism in Charlottesville — but signaled no plans to exit White House advisory panels.
“By stepping down, they’re making a non-partisan group more partisan,” said Charles Elson, an expert at the University of Delaware in corporate governance.
“By stepping down, they lose the influence they could have.”