President Trump’s equivocal response to the deadly white nationalist rally in Charlottesville, VA this past weekend – in which he denounced violence “on many sides” without condemning the explicitly racist ideologies espoused by the demonstrators – drew sharp criticism from elected officials in both parties.
But perhaps more notably, Trump lost four of his key corporate backers: Merck CEO Ken Frazier, Intel CEO Brian Krzanich, Under Armour CEO Kevin Plank, and Scott Paul of the Alliance for American Manufacturing.
Frazier was the first to leave the president’s manufacturing council, of which he was the only black member. He resigned on Monday morning as a matter of “personal conscience,” according to a statement he issued. Trump immediately lashed out at Frazier over Twitter.
The resignations of Krzanich and Plank came later in the day, spurred by Frazier’s decision along with a sense of rising pressure to distance themselves from the president. Paul left on Tuesday.
The manufacturing council is one of Trump’s two CEO councils, and though their role in shaping policy is largely unknown, they have served as important symbols of corporate America’s support for the Trump administration: most of their members are drawn from the highest echelons of the country’s corporate elite, overseeing massive businesses with vast influence over the US political system and in the global economy.
The other CEO council, called the Strategic and Policy Forum, is chaired by private equity billionaire Stephen Schwarzman, the CEO of the Blackstone Group and one of the most powerful figures on Wall Street. Schwarzman hand-picked the members of the council, rejecting the president’s suggestions. Notably, Schwarzman once compared President Obama to Hitler in remarks about the previous administration’s tax policies.
While mingling at a weekend fundraiser party hosted by billionaire Ron Perelman in the Hamptons, Schwarzman was asked about Trump’s response to the Charlottesville events. According to Bloomberg, he “questioned criticism of the president for not directly condemning neo-Nazis and white supremacists in his response to the Charlottesville events.” Schwarzman remarked that he thought Trump “was talking about the violence on both sides,” and that he didn’t think “it was a far-reaching statement,” essentially endorsing the president’s response. Like Trump, he later issued a statement condemning bigotry.
Andrew Ross Sorkin of the New York Times points out that high profile Trump allies like JPMorgan CEO Jamie Dimon — also a member of the President’s economic advisory council — remain dithering and equivocal towards Trump’s bigotry.
Sorkin also writes that “privately, many chief executives say they are fuming, outraged by the president,” but that “many are too scared to say anything publicly that could make them or their company a target of Mr. Trump’s wrath.”
Those remaining on the manufacturing council are not all corporate CEOs. AFL-CIO president Richard Trumka and deputy chief of staff Thea Lee are both members. Trumka issued a statement yesterday denouncing the bigotry in Charlottesville and said that he is re-assessing the AFL-CIO’s role on the council, but has not announced plans to leave it.
Though there have been daily – hourly – moral outrages throughout the Trump presidency, there are moments when the outrage spikes and there is greater potential for public pressure to fragment the president’s network of support in corporate America.
The Muslim ban, for instance, was one such moment, and it resulted in Uber CEO Travis Kalanick’s resignation. The Paris agreement was another, and it led to Elon Musk’s resignation. The events in Charlottesville, and the president’s decision to egg on white supremacist organizing and violence, is another such moment. Some organizations, including Color of Change, are calling on CEOs to “quit the council.”
Trump needs to retain the support of the corporate elite to remain in power — to avoid total isolation, deliver on some promises to his base, and even avoid impeachment. While this support is showing signs of deterioration, the most high-powered CEOs on the councils – Schwarzman and Dimon, for example – remain. Will they continue to collaborate with the administration, eager to collect their financial spoils? Or will they follow Frazier and others in rejecting Trump’s bigotry and disassociate themselves from him? Only public pressure will make the difference.