Though he was frustrated by early failures to overhaul the Affordable Care Act and to restrict immigration from a handful of mostly Muslim countries, President Trump started out with wild success in carrying out one of his other priorities: slashing regulations on business. In a flurry of early actions, he took down much of President Obama’s regulatory edifice and began attacking the “administrative state” that he said exists in Washington, D.C., to perpetuate itself at the expense of American businesses and to the detriment of the U.S. economy.
Trump wants to shake things up and get more things done in the regulatory realm, an ambition that provides a huge opening for CEOs who may have felt they’ve been waiting eight years for just this moment. Yet even in light of his determination, the new president is likely to find some major differences between his rhetoric and promises and the actions that his administration actually ends up being able to take.
With deregulation becoming such a dynamic force already in 2017, here are some ways that CEOs can think, talk and act in this important arena.
1. TAKE RESPONSIBILITY FOR THE CHANGES YOU WANT TO SEE.
During the Obama years, CEOs often cited regulatory overreach as one of the biggest obstacles to growth for both their companies and the domestic economy. So naturally they’ve welcomed Trump’s promises and the new policies to match, and are encouraged to see Republicans—and even some Democrats—in Congress get behind the deregulatory push as well.
But now CEOs will have to help guide the president’s anti-regulatory impulse in the most productive way for business, because Trump’s convictions alone won’t determine what happens in the long run. The deconstruction of the regulatory state will be thwarted in some ways by Democrats, by progressive advocacy organizations, by judicial precedents, by opponents’ lawsuits and by the inertia behind regulation that the federal government has created over decades. Amid this din, CEOs will have to make sure Trump keeps listening to their voices as he did during his campaign.
2. LEVERAGE THE ONCE-IN-A-GENERATION OPPORTUNITIES BEFORE YOU.
Every new administration brings significant shifts in its approach to regulation. Ronald Reagan, for instance, took a big axe to the federal regulatory apparatus, deregulating airlines, as well as savings and loans, with tremendous consequences for each industry and for America. And Barack Obama pushed the pendulum the other way with titanic additions, ranging from Obamacare to a series of executive orders. But President Trump already has shown that he’s sui generis when it comes to the size of his zeal for changing the government’s approach to regulation. He listened to the complaints of CEOs and others during his campaign, and he’s acting directly on them.
There are several venues open to businesses wanting to tap into Trump’s general thrust to benefit their companies and industries specifically. Trump has made his druthers clear in a number of regulatory areas by signing executive orders, such as his clearance of the Keystone XL and Dakota Access natural gas pipelines, his overturning of President Obama’s Clean Power Plan to curb carbon dioxide emissions by coal-burning utilities and his rollback of the moratorium on leasing federal lands for coal production.
In the financial arena, Trump wants to reverse much of the Dodd-Frank legislation that the Democratic Congress passed in the wake of the 2008 global collapse, because he believes it’s choking financial institutions and growth. Specifically, he wants to rein in the Consumer Finance Protection Bureau.
Through his choice for running the Federal Communications Commission, Agit Pai, the new president also wants to take a whack at the “net neutrality” law passed late in Obama’s second term. However, there is plenty of room for business influence in exactly how the regulatory state will carry out the president’s early order for them to eliminate two existing regulations for every new one they institute. Agencies are looking for creative ways to fulfill that mandate.
And CEOs can engage federal agencies, which now have a deregulatory orientation, to interpret legacy regulations in a more favorable way to their business.
3. TAKE ADVANTAGE OF PRESIDENT TRUMP’S FIXATION ON CEOS.
Perhaps no other president has demonstrated this level of determination to accomplish policy aims by buttonholing CEOs. From tweet-shaming CEOs into making job commitments in the U.S. to taking on business leaders who opposed his proposed immigration bans, the president has focused on the important roles CEOs can play in helping him achieve his goals—or in thwarting them.
The conduits through which the president is dealing with CEOs early in his administration mainly have to do with job creation and deregulation. On regulatory issues, savvy CEOs will take advantage of the fact that Trump, himself a CEO, likes dealing with them and understands their world.
Among those who seem to get this are the many CEOs who’ve joined the White House councils of business leaders formed by Trump, covering manufacturing, technology and other areas. Not all who accepted his invitation agree with Trump’s policies or politics—some are outright opponents—but they recognize that the best way to influence regulatory reform and other business-related initiatives is to take a seat at the table. Other CEOs can take advantage of Trump’s openness to them by proposing ways in which a deregulatory idea that hasn’t occurred to him might benefit their companies and industries.
4. LEARN HOW TO DEAL WITH THE NEW ERA FROM AUTO CEOS.
If there’s one industry whose leaders could have gone into a funk after Trump’s election, it was automakers. On the campaign trail, Trump repeatedly thumped Ford for CEO Mark Fields’s decision to move small-car manufacturing to Mexico, and after the election he frightened many an industry leader by persisting in his promise to slap 35% tariffs on all cars coming into the U.S. from Mexico.
But auto CEOs also foresaw how Trump’s approach could benefit them. They knew they needed more robust growth in the U.S. economy to keep record levels of American car sales from sliding off the peak. And they figured the new president would be friendly to their concerns that the ramp-up in federal requirements for improved fuel economy and emissions reductions was too steep for them to meet—especially considering that consumers aren’t all that interested in electric cars yet.
This strategy is paying off. In one of his biggest regulatory actions thus far, Trump moved to give automakers more time to meet their environmental targets, reversing an 11th-hour acceleration in the timetable by the Obama administration. Rising consumer confidence has helped keep U.S. auto sales essentially steady. And, so far, Trump has soft-pedaled the idea of slapping a 35% tariff on cars coming in from Mexico.
5. DON’T ASSUME YOU KNOW WHAT PRESIDENT TRUMP WILL DO.
You may not. Trump is a pragmatist above all and is syncretistic in his thinking. For example, despite campaign complaints about how the North American Free Trade Agreement was a “disaster” for the U.S., the Trump administration has signaled to Congress that it will seek mostly modest changes in that deal in negotiations with Canada and Mexico.
And in the battle royale of environmentalism, climate change, Trump may yet disappoint even some of his own people, such as Scott Pruitt, the new Environmental Protection Administration chief, who has said that carbon dioxide is “not a primary contributor” to global warming. Trump himself hasn’t reflexively called for the U.S. to exit the so-called Paris Agreement on climate change in which signatories pledged to do what it takes to stem a rise in global temperatures. He may be influenced on this score by some of the CEOs on his councils. They include Walmart CEO Doug McMillon, PepsiCo CEO Indra Nooyi and General Electric CEO Jeffrey Immelt, each of whom has launched his or her company on its own agenda to battle climate change.