President Trump has repeatedly inserted himself into corporate decision-making in ways that predecessors would have avoided. Photo / Anna Moneymaker, The New York Times
The president's interventions in company dealings based on his own instincts are a departure from the arm's-length approach of predecessors of either party.
President Donald Trump campaigned on a promise to run the economy like his business empire. And for almost four years, he has unabashedly wielded the power of the presidency to insert himself into corporate affairs, helping some companies and punishing others in line with his instincts and inclinations.
The latest target of his attention is TikTok, the Chinese-owned social media app under scrutiny for potentially providing the Chinese government with access to American user data. After threatening Friday to ban the app from the United States, Trump reversed course, saying he would allow TikTok to keep operating if it was sold to an American owner.
At the White House on Monday, Trump said that TikTok would be shut down in the US on September 15 unless Microsoft or another "very American" company purchased it and that he had told Microsoft's chief executive in a call over the weekend to "go ahead" with the acquisition.
He also argued that the US should receive money in return for letting the deal happen, without explaining how that would work. "A very substantial portion of that price is going to have to come into the Treasury of the United States, because we're making it possible for this deal to happen," he said.
Given the national security concerns, Trump had the right to sign off on a plan to mitigate any risks TikTok posed. But the events followed a pattern that Trump set early on in his presidency, in which some of the world's most powerful companies have found themselves at his whims.
Daniel Price, a former economics adviser to President George W. Bush, said Trump's reversal on TikTok was "just another example of the president's undisciplined and impulsive decision-making style, so bewildering to friend and foe alike."
"China presents serious security and economic challenges," Price said. "But Trump's erratic oscillation from adoration to demonisation has certainly harmed US business interests and actually diminished our ability to influence China or rally allies to assist in that effort."
Unlike his predecessors, Trump has frequently waded in to berate or praise executives and try to influence their operations. He attacked Carrier and General Motors over plant-closing decisions, badgered Boeing to lower prices and used Chinese companies as bargaining chips in negotiations with Beijing.
While past Republican administrations disapproved of government intervention in the market, Trump has had no qualms about taking a heavier hand, favoring industrial policy and a more managed approach to trade.
And when a company's fate is at stake because of government actions — as when the Clinton administration filed an antitrust case against Microsoft, saying it threatened innovation in the nascent internet — presidents have usually kept their involvement at arm's length to avoid charges of political interference.
Trump has not. He has particularly taken aim at multinational companies that he says have made fools of past American policymakers.
He signalled his approach even as a candidate. When United Technologies decided to close its Carrier subsidiary's plant in Indianapolis in 2016 and move furnace production to Mexico, Trump seized on the incident, asserting that only he could get companies to stop moving jobs abroad. He threatened to hit Carrier furnaces from Mexico with 35 per cent tariffs and promised to call the company's executives. In the end, he predicted, they would capitulate.
As it turned out, saving jobs wasn't as easy as he promised. In exchange for US$7 million in tax breaks, Carrier kept the plant open and invested US$16 million in new equipment. But barely half of the 1,350 blue-collar workers in Indianapolis kept their jobs.
Other corporate leaders have felt the heat. Just weeks after his election, Trump strong-armed Boeing into lowering the price of a new Air Force One, declaring that the plane's costs were "out of control" and signaling that he would upend yearslong negotiations.
"Cancel order!" he tweeted.
Since then, Trump has singled out several companies for confrontation, driven in some cases by personal pique.
He has repeatedly attacked what he calls the "Amazon Washington Post" and Jeff Bezos, the Amazon founder who also owns the newspaper. He has said his yearslong assault on the Postal Service is based on his belief that the government does not charge Amazon enough to ship its packages.
Trump's antipathy toward many news organizations has led him to repeatedly threaten to interfere with media companies' operations. He twice urged regulators to examine taking away the "license" from NBC, though it was unclear what license he was referring to. He declared as a candidate that he would not approve AT&T's acquisition of Time Warner because the company owned CNN, a network he frequently accuses of treating him unfairly, and the Justice Department later sued unsuccessfully to block the deal.
He has also lashed out at companies and their executives for perceived failures in responding to his desires. After Kenneth C. Frazier, chief executive of Merck Pharmaceuticals, resigned from a presidential advisory council over Trump's handling of violent white nationalist protests in Charlottesville, Virginia, the president took after him on Twitter for "RIPOFF DRUG PRICES."
Trump denounced General Motors for closing a car factory in Lordstown, Ohio, and three other plants in the US, and attacked its chief executive, Mary T. Barra, by name. Later, with the onset of the coronavirus crisis, Trump criticized Barra for what he said was the company's failure to make good on a promise to help make ventilators.
"Always a mess with Mary B," he wrote on Twitter.
"He's been doing this from the outset, using his power to try to influence corporate deals," said Richard W. Painter, a professor at the University of Minnesota Law School. "Being president is not the art of the deal. He's not in a boardroom. He's in the White House."
But Trump's efforts to dictate corporate decisions have been inconsistent, making it harder for executives to anticipate White House demands or reactions.
As he found himself on the defensive this spring in his handling of the coronavirus pandemic, Trump resisted calls to use the Defense Production Act to pressure industries to make more masks and medical supplies, saying that such a move would be akin to "nationalising our business" and that the government "was not a shipping clerk."
And even with China, which many in Washington have accused of gaming America's free-market system by stealing intellectual property and cheating on trade rules, Trump has not always intervened to take a tougher line.
In 2018, he lifted tough sanctions against Chinese telecommunications firm ZTE, over the objections of Republican lawmakers and his own national security advisers, in an attempt to win China's help in negotiating with North Korea. He has alternated between condemning another Chinese technology giant, Huawei, as a grave security threat and holding off on acting against it in hopes of securing a trade deal.
The president's back-and-forth on TikTok offers a new illustration of how he has made national security decisions by impulse.
A national security panel, called the Committee on Foreign Investment in the United States, recommended to the president last week that TikTok sell its assets to an American company to curtail China's potential influence in the US, and Microsoft had stepped forward as a potential buyer.
But several China hawks in the Trump administration, including White House trade adviser Peter Navarro, argued against the sale, seeing the moment as an opportunity to take more sweeping action against TikTok and other Chinese-run internet services.
Trump took Navarro's side Friday, saying that he did not favor a sale of TikTok and that he planned to ban the app. But after a series of calls, including ones from Sen. Lindsey Graham, R-S.C., and Satya Nadella, chief executive of Microsoft, Trump appeared to change his mind.
Several of Trump's aides had warned that a ban could prompt an intense legal battle, as well as hurt the president's popularity with younger Americans. TikTok has said it is used by 100 million Americans.
Trump appeared to object to TikTok's sale in part because it would funnel money back to China. Speaking to reporters Monday, the president argued that the US should also receive money in return for permitting the deal to happen, because Microsoft would not have the right to make the acquisition "unless we give it to them."
Explaining his views to reporters, Trump drew a parallel to his days in real estate development.
"It's a little bit like the landlord-tenant," the president said. "Without a lease, the tenant has nothing. So they pay what's called key money.
"The United States should be reimbursed or should be paid a substantial amount of money," Trump said, "because without the United States, they don't have anything."
Written by: Ana Swanson and Michael D. Shear
Photographs by: Anna Moneymaker and Doug Mills
© 2020 THE NEW YORK TIMES
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