At the recent House Financial Services Committee hearing, Wells Fargo’s CEO Tim Sloan was brought in to answer questions about the bank’s loan practices. It was never going to be a love fest. Sloan was prepared to speak to accusations about “Wells Fargo’s pattern of consumer abuse.” Instead, he got a crash course in digital communications by the new reigning queen of the Democratic Party, Alexandria Ocasio-Cortez.
The populist and self-described socialist Congresswoman flatfooted Sloan by asking him to defend the bank’s loans (she claimed went to support Trump’s migrant caravan enforcement):
“Why was the bank involved in the caging of children and financing the caging of children to begin with?”
— Congresswoman Alexandria Ocasio-Cortez (D-NY)
The accusation left Sloan speechless and he stammered: “For a period of time, we were involved in financing one of the firms, we are not anymore. I’m not familiar with the specific assertion you are making.”
That might have worked in 1999, not 2019.
The Congressional hearing will persist as a watermark between the old ways of reputation building and the new. The younger and more social media-literate elites like Ocasio-Cortez and Beto O’Rourke know how to trash reputations without spending a dime of marketing money. They do what technology companies do all the time, they ‘hack’ reputations, meaning destroy them so quickly there isn’t a chance to respond.
The new progressive populists have taken over the Democratic Party. Their anti-business policies, as well as loyal support from labor unions, make it an ominous period for companies of any stripe. For banks and energy, it is an ambulance ride to the intensive care ward. But what is most frustrating is that those new radical policies rely on old fashioned tricks: better preparation, closer to customers, and better tools.
We call that disruption.
Ocasio-Cortez wasted little time in dispelling the notion that she cares little about how business works but knows a lot about social media.
Within seconds of her question, the tweeting began and she retweeted (we presume not from the hearing dais) to her 3.4 million followers. When a notion is communicated to tens of millions within seconds, we require a new space/time equilibrium to help us understand how it works, and the brilliance of a latter-day Einstein to devise it. It is an awesome power, and unfortunately, it is aimed at the people who run companies.
If only it were true.
There were at least three glaring inconsistencies in Ocasio-Cortez’s accusations, confirmed shortly after by the media. No one, not even Wells Fargo’s Sloan, addressed any of them. If he had been better-prepared by policy wonks and handlers, as Ocasio-Cortez was (to learn more about her policy advisors, read this), and ready to do digital battle, he might have said (all from published media reports):
• The photos you displayed of ‘caged children were taken during the Obama years, according to CNBC.
• A company we made loans to, which you defamed, CoreCivic, does not provide housing for any children who aren’t under the supervision of a parent. They don’t operate shelters for unaccompanied minors, nor do they operate border patrol facilities.”
• The other company, GEO Group, has never managed facilities that house unaccompanied minors and played no role with policies related to the separation of families. The contractual services they provide are no different than the services we provided for eight years under the Obama Administration.” Next question, please?
These comments would have made great Tweets. Why can’t CEOs get the hang of this?
Executives trained to deal with errant analysts on earnings calls by $500 per hour public speaking coaches and crisis counselors are going to find their skills are as useful as a glider pilot in the cockpit of the Space Shuttle.
Communication in the digital era is not just faster, the rules are new, including that old bright line between falsehood and truth. Twitterese is a very different language than legalese. It is also the language people remember because what matters now is what’s first. What’s first is what’s right and that beats true. Then the news cycle moves beyond the facts in short order.
You could say, there is no time for actual truth, just the Twitter Truth.
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