EDITORIAL: Trump tweets create unstable ground for businesses
There are proverbs about building castles in sand. It's generally seen as a bad tactic, trying to lay down a foundation while the ground itself is constantly changing.
Perhaps it's time for leaders of the business community to remind the president about those proverbs.
Trade talks with China are going badly, then they're going well, then China reiterates that nothing has changed, the talks are still going badly.
Stocks drop because of presidential tweets, then they rebound, then they fall again.
President Donald Trump disagrees with other leaders of the Group of Seven about Russia, China, Iran, climate change and more, and yet his takeaway on last weekend's meeting in France was "unity."
“We got along great,” he said. “We got along great.”
The constant yo-yoing is starting to take a toll two and a half years into the Trump presidency even among some of the president's supporters in the business community.
Friday's tweetstorm about American companies doing business in China certainly didn't win him any friends.
Trump said he “hereby ordered” U.S. companies to “immediately start looking for an alternative to China,” and later he tweeted that he had the authority to order private companies to do his bidding under the International Emergency Economic Powers Act of 1977, but he wasn't going to do that right now.
After further tweets that specifically called on UPS, FedEx, Amazon and the U.S. Postal Service to search out and refuse shipments of fentanyl from China, stock prices for the private companies dropped.
Whether the Economic Powers Act does give Trump the authority to force companies to divest their China assets would be up to the courts to decide, according to FactCheck.org, and his tweets raised questions about the wisdom and propriety of making the 1977 act used to target rogue regimes, terrorists and drug traffickers the newest weapon in the clash between the world’s largest economies.
But just saying that that could happen is enough to get some business leaders to speak out.
"It's a hot-headed thing to say because it presumes powers the presidency does not hold," said David N. Taylor, president of the Pennsylvania Manufacturers' Association, regarding Trump's order to cut ties with China. "A lot of time I wish the president was saying what he meant and not being so sloppy and imprecise."
Sloppy and imprecise. Constant uncertainty. Unpredictability.
Those are the qualities Trump seems to thrive on, and those are the qualities that businesses usually hate.
"Our economy enjoys predictability and stability," said Kevin Schreiber, president of the York County Economic Alliance. "The market tends to like that. Any level of unpredictability has an inverse relationship with the market. When you inject that through tariffs and trade wars, that just lends some level of unpredictability."
"The uncertainty certainly has an impact on businesses," said Gene Barr, president of the Pennsylvania Chamber. "It certainly has an impact on the market."
Let's face it, this president doesn’t seem to fully grasp the complex mix of powers and limits on his office. He either doesn't comprehend or doesn't care if his tweets about individual companies send their stock prices into a nosedive. His tweets and remarks somehow assume both too much power and a lack of accountability at the same time. He wants to take credit for actions that he didn't initiate, but he also doesn't want responsibility when his actions have negative consequences.
Business leaders say that they still stand behind Trump and his policies, citing tax cuts and loosening regulations. But at some point they will have to contend with the fact that the ground is unstable. We can only hope that the realization comes before it is too late to move to firmer terrain.