President Donald Trump has finally abolished his CEO business councils. The move comes barely days after a growing number of CEOs who were part of the councils decided to quit owing to Trump’s weak response to a violent white supremacists rally in Charlottesville. The President had termed the quitting CEOs as grandstanders but in a tweet sent on Wednesday afternoon, Trump thanked all of them as he disbanded the groups. There are reports that indicate that the announcement was strategic for Trump. It was speculated that one of the groups that formed the strategy council, which included top business and finance executives, was planning to disband, so the President saw it fit to get ahead of the story.
Before moving forward with the disbandment, Trump said in a press conference on Tuesday that he would replace the CEOs who had decided to quit the councils. Trump appeared unmoved by Merck & Co.’s CEO Kenneth Frazier resignation on Tuesday before moving to comment on race relations and the violence that had broken out in Virginia at the white supremacist rally. In his statement, Trump partly blamed the demonstrators who were protesting the gathering. This was not received well by some people including some of the CEOs that were part of his councils. A woman was killed in the violent rally in Charlottesville.
Immediately after this announcement, members of the councils started to tender their resignation letters. It all began with Blackstone Group LP’s Stephen Schwartzman followed by Larry Fink from BlackRock Inc. Then other members of the councils followed. The abolishment of the councils is a big blow for Trump who had billed himself as the business savvy President who was not comprised by the political baggage in Washington. There are reports that after the two high profile resignations, there was a conference call on Wednesday morning where 10 members voted to leave the council.
According to a source on the matter, the CEOs had planned to inform the White House on the decision to leave before making it public. BlackRock’s CEO sent a memo to employees on Wednesday stating categorically that any kind of racism, violence, and anti-semitism had to be criticized without any caveats. Fink also said that while he had disagreed with the President on various occasions in the past, based on the events in Charlotte, he could not, in good conscience, continue participating in the forum.
The manufacturing council was created in order to advise the President. The forum that features financial experts was to work hand in hand with the manufacturing council although the two forums had not yet met. There were also CEOs who decided to quit the manufacturing council including Under Amount Inc’s CEO as well as the CEO of Intel. Analysts have, however, argued that even though this is definitely a setback, it does not indicate that corporate America will turn against the President. There’s genuine hope that the administration will move forward on corporate tax reforms despite these hiccups.
