Eastern Promises

This is how the game is played:

Either before or after the tweet is sent about your company, you make a trip to Trump Tower on Fifth Avenue or to Mar-a-Lago (which will be the new combination White House / Camp David, by the way) and you parade ostentatiously before the bank of TV cameras. “Look at me! I’m down with the President’s agenda!”

Then a half hour later, you come down the golden elevator with the man himself, who holds an impromptu Q&A with you, as part of his end of the deal. Announcements of new jobs are made. New factories. New initiatives that will be undertaken, ASAP. Then he goes back up in his golden elevator for the next meeting and you get another 10 minutes of face time with the news crews. You grin optimistically, knowing that you and your company are off the Twitter shit list for awhile.

Mission accomplished.

It’s an old playbook, imported from the east. More on that in a moment.

One of the obvious things going on here, at least to the business world, is that much of this is just another reality show. There’s truth to these corporate pronouncements, but there’s plenty of artifice as well. It’s a pageant of sorts, designed for the consumption of the masses. To which I’d say, so what? If it gets the job done, let the man put on his show. Just don’t get overly excited about any sort of national transformation.

Here’s NBC News with some background on the fact that many of these corporate hiring and expansion plans were already in the works. It’s just that they don’t usually necessitate a press release and a meeting with the White House. The fifteen million jobs created by American businesses under President Obama were mostly not tweeted by @POTUS. Maybe they should have been.

Companies eager to avoid becoming the target of the next attack by President-elect Donald Trump are preemptively — or retroactively — announcing U.S. job creation plans.

But peel back a layer and the promises come with some caveats. A company’s plan to increase capital expenditures, which include jobs and facility improvements, are typically years in the making. Some of these “announcements” are old news in a new hat.

GM said its plan was approved before the election, but told Bloomberg it was “accelerated” under pressure from Trump, for example.

Wal-Mart’s job creation plans are in line with its normal annual increase, and come after it has closed 269 under-performing stores and cut thousands of jobs.

The combined Bayer-Monsanto U.S. R&D spending pledge is roughly what the two companies are already spending, CNBC reported.

And Sprint’s jobs were part of a previously announced commitment by its parent company to create 50,000 jobs in the U.S.

“This is the normal course of business,” independent auto industry consultant Maryann Keller told Bloomberg of the moves by GM and other automakers. “All they’re doing is announcing investments that they would have made anyway.”

Trump is media savvy enough to understand that the specifics don’t really matter. Americans consume news via headlines on apps and Facebook updates – we’re talking 20 words or less. Trump also understands that the sheer volume of the announcements has the power to drown out the knit-picking about any individual announcement in and of itself. We live in the Era of Whatever. You have your version of things and I have mine. Whatever.

Promises of job creation and prosperity, demanded of the corporate class at metaphorical gunpoint, aren’t new. They are part of a Russian playbook that’s been in effect since Yeltsin’s administration oversaw the chaotic creation of Russian-style capitalism in the 1990’s. The unwritten agreement was that oil, coal, shipping, steel and real estate oligarchs would be safe – so long as the Kremlin would never be made to look bad.

In the summer of 2009, protesting workers in a metals and mining town shut down a major roadway when their pay was late and their livelihoods were threatened as a result of the global financial crisis. They caused a 250 mile long traffic jam, which made the Kremlin look bad. Big mistake.

The aluminum factory in question was run by Oleg Deripaska, who had been Russia’s wealthiest man prior to the crisis and was now swimming in debt, largely owed to western banks. Prime Minister Vladimir Putin decided to make an example of the billionaire and he did so on television for the whole nation to watch. Putin calls Deripaska and his entire management team cockroaches. Then he forces him to sign a document making it impossible to lay off workers or downsize the plant in any way. After Deripaska signs and begins to saunter away with his tail tucked between his legs, Putin says “And give me back my pen.” The point he’s making is unmistakeable.

Had Obama man-handled US corporations and their executives in this way during the financial crisis, Republican politicians would have been howling in outrage. Today, given their new base of voters who’ve come over from the ranks of formerly union blue-collar Dems, they’d probably applaud it. It’s funny how attitudes shift so quickly.

How soon before we see a version of the below video clip play out here? Will people be horrified or gleefully sharing it online? I’m not sure.

Full Disclosure: Nothing on this site should ever be considered to be advice, research or an invitation to buy or sell any securities, please see my Terms & Conditions page for a full disclaimer.

What's been said:

Discussions found on the web