Amazon not alone in facing a Trump tirade
US president’s verbal assaults have seen several companies adopt a presidential Twitter strategy, and for most, that strategy comes down to waiting out the storm
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Associates say President Donald Trump is often riled up by Amazon’s connection to whose owner, Jeff Bezos, founded the retail giant. The attacks are said to be usually prompted by articles in that Trump perceives as negative.
Amazon, you’re not alone. President Donald Trump once accused Verizon of making “a stupid deal” for AOL. He ridiculed Coca-Cola as “garbage” — but said he would keep drinking it. He called both H & R Block and Nordstrom “terrible”.
He said Sony had “really stupid leadership” and described executives at S&P Global, a financial firm, as “losers”.
Before and after he became president, Trump attacked tech firms, military contractors, carmakers, cell phone companies, financial firms, drug companies, airconditioner makers, sports leagues, Wall Street giants — and many, many media companies, which he has labelled “shameful”, “dishonest”, “true garbage”, “really dumb”, “phoney”, “failing” and, broadly, “the enemy of the American people”.
Lately, Trump’s anti-business rants have become particularly menacing and caused the stocks of some companies to plunge. His Twitter posts have carried with them the threat, sometimes explicit, that he is prepared to use the power of the presidency to undermine the companies that anger him.
The US Chamber of Commerce, long a booster of Republican presidents, is not happy.
“It’s inappropriate for government officials to use their position to attack an American company,” said Neil Bradley, the executive vice-president and chief policy officer of the chamber. Bradley, who did not specifically name Trump, added that criticism of companies from politicians “undermines economic growth and job creation”.
Amazon’s stock price dropped sharply before rebounding after Trump threatened the company with possible antitrust action. The president’s remark in November that the merger of AT&T and Time Warner would not be “good for the country” roiled the continuing antitrust fight between the companies and the government. His earlier complaint on Twitter that Boeing’s $4 billion (Dh14.6 billion) price for a new generation of Air Force One was “out of control” forced a fresh round of negotiations, although the price fell only to $3.9 billion.
Most presidents have clashed with business interests and industries, sometimes in ways that generated headlines.
But Trump is unique in singling out individual companies for ridicule with regularity. And rarely have presidents done so because of a personal pique or grudge, as happens with Trump.
“This is an unprecedented situation for companies. The president’s tweets can cause significant reputational harm,” said Dean C. Garfield, the president of the Information Technology Industry Council, which represents big technology companies like Amazon, Dell, Facebook, Google and IBM. “We are now at a place where about 90 per cent of the companies we represent now have a presidential Twitter strategy in place.”
“It’s no laughing matter,” he said.
For many companies, that strategy comes down to waiting out the storm. In recent days, Amazon has all but ignored the president’s taunts, which he issued in a flurry of tweets.
“There’s no real advantage going toe-totoe with him,” said Joe Lockhart, a press secretary for President Bill Clinton. “And his attention span is so short, he will move on. He’ll find another target.”
Associates say the president is often riled up by Amazon’s connection to The Washington Post, whose owner, Jeff Bezos, founded the retail giant. People close to the president have said his attacks on one of the country’s largest businesses have usually been prompted by articles in The Post that Trump perceives as negative.
Likewise, the president’s interest in the AT&T merger with Time Warner largely stems from his repeated clashes with CNN, a subsidiary of Time Warner, which he regards as biased against him.
Legal fight with NFL
Trump’s lashing out at the NFL — he has repeatedly criticised football players for kneeling at games and once said he hoped a player “sues the hell out of the @nfl for incompetence & defamation” — comes in part from his decades-long legal fight with the NFL after he bought a team in the competing US Football League.
As a private citizen, Trump has attacked companies, including calling several times for boycotts. The remarks served to raise his profile and fed the image of a no-holdsbarred businessman who was unafraid to rebuke his rivals or his critics. But in those days, such comments had little ability to move stock prices or affect sales.
As a candidate and as the president, Trump also uses his verbal assaults on companies to bolster his populist message that he is on the side of workers, not big business. (Still, Trump secured a large tax cut last year for corporate America.)
Trump’s most ardent supporters say they appreciate his willingness to criticise the corporate establishment. “He continues to go directly after the companies and not care about political correctness,” said Terry Bowman, who works at a Ford Motor parts factory in Ypsilanti, Michigan. “He says things that a polished politician would never say. He says things that come directly from the American worker.”
Inaccurate numbers
In his most recent attacks on Amazon, Trump has accused the company of using the US Postal Service as “its Delivery Boy” and claimed that the federal agency was being ripped off by the online retailer.
“A report just came out. They said $1.47, I believe, or about that for every time they deliver a package, the United States government — meaning the post office — loses $1.47,” the president said.
He added, ominously: “So Amazon is going to have to pay much more money to the post office. There’s no doubt about that.”
Trump’s numbers were inaccurate — the Postal Service makes money from Amazon — but business executives say such statements have a chilling effect.
When Merck’s chief executive, Kenneth C. Frazier, quit a presidential business council last year in protest of some of the White House’s policy positions, other members were initially reluctant to come to his defence for fear of a verbal attack by Trump.
The council eventually disbanded but only after much internal negotiation among members to quit in force.
The multi-day decline of Amazon’s stock price after Trump’s repeated jabs at the company has exacerbated such fears, said Jeffrey A. Sonnenfeld, a professor at the Yale School of Management and president of the Chief Executive Leadership Institute. “Other business leaders don’t want to catch the contagion,” he said.
But he added that refusing to engage could also be risky. He said that Bezos’ silence had hurt the company, leaving it exposed to Trump’s accusations that it received subsidies from the Postal Service and was not paying its fair share of taxes.
“The right answer for CEOs is not to engage in a mud fight but to come with facts,” Sonnenfeld said.
“UPS and FedEx have their facts, but we haven’t heard from Amazon.”