This year, through the eyes of Trump
A month-by-month look at 2016 as seen by the U.S. president-elect
It is tempting to view the business year through the lens of Donald Trump, traversing the seasons of 2016 in lockstep with the transmogrification of the real-estate-developer-turned-reality-TV-star-turned president-elect. Consider:
January
As the snow fell in Davos, Switzerland, the global Big Think confab hosted investor-philanthropist George Soros, who aligned Trump with terrorists.
“Donald Trump is doing the work of ISIS,” Soros said in an interview with Bloomberg TV. “ISIS, and before that Al Qaeda, discovered the Achilles heel of Western civilization and that is the fear of death. It interferes with reason and people do things out of fear, which is actually quite harmful . . . It’s a very simple message.”
On the hustings, in a rally in Sioux Center, Iowa, the Republican presidential hopeful seeded headlines with this bon mot: “I could stand in the middle of Fifth Avenue and shoot somebody and I wouldn’t lose any voters, OK? It’s, like, incredible.” The Iowa caucuses were just four days away.
Or one could pay deep attention to a drama unfolding in an Ontario courtroom regarding the future of U.S. Steel Canada.
The once mighty Stelco Inc., founded 1910, became a tortured tale of U.S. takeover circa 2007. The potted history: approved on the basis of it being of “net benefit” to Canada, the takeover by United States Steel Corp. was packaged with promises of minimum production and employment levels. There followed the financial crisis, the focus on America-first production and a lawsuit filed by Industry Canada against the U.S. parent for non-compliance. That suit was suddenly settled behind closed doors in December 2011, and henceforth became known as the “secret deal.” Three years later, the Canadian subsidiary sought bankruptcy protection under the Companies’ Creditors Arrangement Act.
Fast forward to January 2016, when U.S. Steel appeared in an Ontario courtroom arguing for front-ofthe-line claims status in the restructuring process, arguing that an infusion of $2.2 billion into the Canadian operation was debt and not equity. The Pittsburgh steelmaker won the day, a blow to workers and pensioners alike.
The take-away: as the previous paragraphs make clear, it’s near impossible to précis the Stelco tale, but the sadness over its diminishment was unalloyed.
February
“Saks is a dream. Saks is a feeling.” That’s Marc Met- rick, president of Saks Fifth Avenue, squiring the Star’s Francine Kopun around the retailer’s shiny new premises in the dowager Simpsons store at Queen and Yonge. Betting the luxury market will continue on its post-recession growth trajectory, the upscale retailer followed its downtown opening with a Sherway Gardens launch the following week and a spray of Off Fifth outlets to serve the underdeveloped off-price luxe market. The push marks a major move since the retailer was purchased by Hudson’s Bay Co. in the summer of 2013.
Yet all was not happy in the land of retail. On Feb. 4, Danier Leather Inc. filed for creditor protection and, ultimately, bankruptcy after a string of money-losing years and a recognition that the company had not caught up with winter-wear trends of puffy coats and furs. Canada’s largest specialty-apparel retailer, found- ed in 1972, employed 1,000 workers at its peak. By year’s end, a small-scale comeback was staged with the newly shortened name — simply, Danier — and three stores.
Surely the incongruous quote of the month award goes to U.S. Congressman Trey Gowdy as he attempted to pry an answer — any answer — from Martin Shkreli during the appearance of the Bad Boy of Pharma before the House Oversight Committee. When he was CEO of Turing Pharmaceuticals, Shkreli drove the per tablet cost of Daraprim, which treats toxoplasmosis infection in AIDS patients, to $750 (U.S.) a tablet from $13.50. Shkrel pleaded the fifth and offered nothing beyond the occasional smirk.
Desperate, Gowdy turned to rap. “We can even talk about the purchase of ah, is it Wu-Tang Clan? Is that the name of the album? The name of the group?”
Shkreli, who reportedly paid $2 million (U.S.) for the group’s one-off Once Upon a Time in Shaolin, remained mum. March
“We don’t have it for you tonight . . . April Fool. Just kidding.”
Elon Musk was in his element March 31 as eager car buyers pitched tents and hauled out sleeping bags to be first in line to preorder the Tesla Model 3. A $1,000 down payment secured Tesla’s not-yet-fully-designed entry into the affordable, high-volume car market. The base model of the long-awaited Model 3 promises a 0-to-96 km/h acceleration in under six seconds and a range of 346 kilometres — not quite what Tesla supporters were hoping for.
Day 1, more than 115,000 buyers preordered the electric car that aims to go up against the likes of GM’s Bolt and which will sell at a starting price of $35,000 (U.S.).
Four months later, the admirably idiosyncratic Musk released his Master Plan, Part Deux: “Starting a car company is idiotic and an electric car company is idiocy squared,” he wrote. Apparently, Jaguar Land Rover Ltd. disagrees. Before the year was out the U.K.’s largest car company announced it would be going head to head against Tesla’s fast and sleek Model X. The Jaguar I-Pace is designed to hit 100 km/h in four seconds and a range of 498 km per charge. Coming to you in 2018.
April Illegal conduct. Fraudulent practices. Toxic securities. Knowingly putting investors at risk. Eight years after the financial crisis, the U.S. Justice Department announced a $5.06billion settlement with Goldman Sachs, citing a laundry list of misbehaviour. The bank assured investors that securities it sold were backed by sound mortgages “when it knew that they were full of mortgages that were likely to fail,” the Justice Department found. The financial settlement was but a glancing blow to the mighty Goldman, which reported $2.1 billion in net earnings on revenues of $8.2 billion for the third quarter.
Meanwhile, in Brooklyn, presidential heir presumptive Hillary Clinton went toe-to-toe with Bernie Sanders in the final Democratic debate. Sanders’ closing remarks were a barn burner: “I disagree with Secretary Clinton in the belief that you can get money from Wall Street, that you can get money for a super PAC for powerful special interests and then at the end of the day do what has to be done for the working families of this country. I just don’t accept that. What I believe is that this country, if we stand together and not let the Trumps of the world divide us up, can guarantee health care to all people as a right, can have paid family leave and medical leave, can make public colleges and universities tuition free, can lead the world in transforming our energy system and combating climate change, can break up the large financial institutions, can demand that the wealthiest people in this country start paying their fair share of taxes. And we can do that when millions of people stand up, fight back and create a government that works for all of us and not just the one per cent. That is what the political revolution is all about.”
Sanders would lose the nomination three months later.
May Following the filing of 1,400 cases in the U.S., a Canadian class-action lawsuit was launched against healthcare giant Johnson & Johnson Inc. over an alleged link between its Baby Powder and ovarian cancer. The suit alleges that across a period of decades, four plaintiffs had consistently used the company’s talcum powder as a feminine hygiene product and that all four women developed ovarian cancer. One of the plaintiffs died two months prior to the filing. That same month, Johnson & Johnson was ordered by a St. Louis, Mo., jury to pay $55 million (U.S.) to a 62-year-old cancer survivor who had applied talcum powder in her genital area for more than 30 years. That award was one of three Missouri awards totalling close to $200 million.
Johnson & Johnson has consistently said that the talc is safe and has said it will appeal the verdicts.
In its filing, Canadian lawyers cited a 1982 study published in Cancer showing that women using talc either as a dusting powder on the perineum or on sanitary napkins were at a 3.28 times greater risk of developing ovarian cancer. Further studies were warranted, researchers said then. More than 30 years later, the American Cancer Society states on its website: “Talc is widely used in many products, so it is important to determine if the increased risk is real. Research in this area continues.”
June One word: Brexit. In the wee hours of June 24, British Prime Minister David Cameron trimmed an Enoch Powell quote thusly: “All political lives end in failure,” he lamented, sidestepping the middle part of that citation: “unless they are cut off in midstream at a happy juncture.”
This was no happy juncture for the PM. Britons overall voted 52 per cent in favour of the U.K. exiting the European Union, causing predictable confusion in the stock markets, a haircut for the pound and a stripping, by Standard & Poor’s, of the U.K.’s last remaining AAA credit rating. Once again we are reminded of the degree to which financial markets detest instability.
Shortly after Cameron announced his resignation, in an epically bizarre coincidence, Republican nominee Donald Trump landed in Scotland to check up on his contentious and money-losing golf course in Turnberry. “Place is going wild over the vote,” Trump tweeted. “They took their country back, just like we will take America back. No games!”
Once again, Trump was oblivious to the facts: 62 per cent of Scottish voters voted to remain in the EU.
July “The Beast is still up, it’s surrounding the city. And we’re here doing our very best for you.” Darby Allen, fire chief for the Regional Municipality of Wood Buffalo, had nicknamed the relentless spring wildfire that tore into Fort McMurray “The Beast,” a moniker that stuck as it raged across an estimated 590,000 hectares in early May.
In early July, the Insurance Bureau of Canada announced that the Alberta fire was the costliest insured natural disaster in Canadian history, with estimated insured property damage of $3.58 billion (Canadian). That figure widely outpaced the southern Alberta flood of 2013, where insurance costs tallied approximately $1.7 billion (though total costs were estimated as high as $6 billion).
Don Forgeron, president of the insurance bureau, cautioned that the wildfire “Is more alarming evidence that extreme weather events have increased in both frequency and severity in Canada.”
Other storms had moved in. Hillary Clinton accepted the Democratic nomination on July 28. A week earlier, Donald Trump accepted the nomination for the Republican ticket. “Nobody knows the system better than me,” Trump said in his acceptance speech. “Which is why I alone can fix it.”
August The most followed religious leader in the world does not have a Facebook page. While His Holiness Pope Francis inherited a Twitter account from his predecessor, and can now claim 27 million followers through his accounts in nine languages, the Vatican had previously made it clear that a Facebook account would simply be too much work. As it is, the Vatican has to deal with intemperate replies sent to @Pontifex. The head of the Vatican’s social communications council said that time enough is spent eradicating offensive comments from the Holy See’s official news website.
Still, Pope Francis has been masterful in his outreach to the likes of Apple CEO Tim Cook, Alphabet CEO Eric Schmidt and, in August, Facebook CEO Mark Zuckerberg.
With his wife, Priscilla Chan, at his side, Zuckerberg presented the Pope with a miniature drone, a mock-up of the solar-powered craft that the billionaire hopes will deliver Internet connectivity to impoverished regions.
A Vatican spokesperson said the Pope and Zuckerberg spoke about “how communications technology can be used to alleviate poverty, encourage a culture of encounter and help deliver a message of hope, especially to the most disadvantaged people.”
The Pope has been a consistent outspoken critic of unbridled capitalism. A taste: “Once capital becomes an idol and guides people’s decisions, once greed for money presides over the entire socioeconomic system, it ruins society.” Perhaps this need not have been underscored in the presence of the Facebook founder. Chan and Zuckerberg have pledged to give away 99 per cent of their wealth.
September “You should resign. You should give back the money that you took while this scam was going on, and you should be criminally investigated by both the Department of Justice and the Securities and Exchange Commission. This just isn’t right.”
Senator Elizabeth Warren eviscerated Wells Fargo CEO John Stumpf before the U.S. Senate Banking Committee, a deeply principled reminder of what a fine presidential candidate she would have made. Wells Fargo, should anyone need reminding, opened, oh, two million or so credit card and bank accounts without cus- tomers’ knowledge, pushed by worker bees attempting to fill their crossselling product quotas.
More than 5,000 employees were fired, but it was Stumpf, Warren charged, who personified the cancerous corporate culture. Weeks later, Stumpf was gone. “So far, he’s one for three,” Warren said, still pushing for the DOJ and SEC to investigate.
This side of the border, September ushered in a tentative agreement between Unifor and General Motors, in which the auto union agreed to say goodbye to its hybrid defined benefit/defined contribution pension plan for new hires in exchange for production commitments at Oshawa and St. Catharines.
“It boiled down to if we wanted the investment, then the (defined-benefit) plan had to go,” Unifor president Jerry Dias told Automotive News. Wrote the Star’s Tom Walkom: “This deal, if ratified, will drive one more stake into the heart of company pension plans across Canada.”
The deal was ratified Sept. 25.
October Power down. The news out of Samsung Electronics Inc. regarding its exploding Galaxy Note 7 started in early September, just weeks after the phone’s release, with reports of a “battery cell issue” and 35 affected clients. The words “exploding” or “fire” were nowhere to be found in the corporate press release. Replacement phones were offered. No corporate hysteria was noted.
A précised timeline of events: On Sept. 15 Samsung issued a first recall and the U.S. Consumer Product Safety Commission told customers to “immediately stop using and power down” the device. The South Korean company promised replacement phones within the week. On Oct. 10 Samsung announced that it was “temporarily adjusting the Galaxy Note 7 production schedule to take further steps to ensure quality and safety matters.” The following day the company announced that it had halted production “for consumer safety reasons.” On Oct. 15, the phones were banned from all North American flights. The company later promised that the findings of a full internal investigation will be released to the public.
November “You can’t flinch.” That’s New York Senator Chuck Schumer after being elected Democratic Senate minority leader 10 days after the presidential election that shook the world.
“Each of us believes we need a sharper, bolder economic message about returning the economic system, which so many feel is rigged against them, to one that works for the people,” Schumer said, backed by Senator Elizabeth Warren and failed presidential nominee Sanders.
Schumer vowed that each and every day Senate Democrats would fight for America’s middle class and those struggling to join it. It could have been a campaign line. U.S. observers likened the pending TrumpSchumer battle to a street fight. Game on. On the other hand, there’s the TPP. “Even if all other 11 ratified, there is no TPP.” That was International Trade Minister Chrystia Freeland when pressed in the House on the status of the trans-Pacific Partnership. Translation: Without U.S. ratification there is nothing. Presidentelect Donald Trump, remember, had thoughtfully declared the trade deal “a potential disaster,” and insisted the U.S. would not ratify it. Well, let’s see what January brings.
“The Beast is still up, it’s surrounding the city. And we’re here doing our very best for you.” DARBY ALLEN FIRE CHIEF FOR WOOD BUFFALO, ON THE SPRING WILDFIRE THAT TORE INTO FORT MCMURRAY
December The moment was heart-swelling.
Well, a little bit heart-swelling. In early anticipation of emerging from CCAA, U.S. Steel Canada led employees in a positive public relations exercise by hoisting a new Stelco flag, complete with new logo. But as the Hamilton Spectator reported, “not all was celebratory beneath the flags and smokestacks.”
The ultimate outcome of the proposed sale to U.S. private equity firm Bedrock Industries Group remains unknown. The steel company’s pensioners, meanwhile, remain anxious about lost health benefits and fearful that their pensions will be further impaired. Said Gary Howe, president of United Steelworkers Local 1005, “There is no way that I can go to any flag-raising with these issues not being resolved.”
In a lighter vein, Time magazine, unsurprisingly, named Donald Trump its Person of the Year.
Social media quickly noted the, well, hornlike positioning of the letter “m” from the Time logo behind his head. The magazine rejected such foolery. “Given the shape of the letter ‘m’ in the magazine’s name and its location on the cover, many other subjects in the past have also appeared to sprout extra features . . . Any resemblance to cats, bats or devil horns is entirely coincidental.”