Earlier this week, I wrote about the false consciousness of the plutocrat class—that is, its inability to recognize that President Donald Trump is destroying its wealth through economic mismanagement bordering on sabotage. Today we’ll consider another failing of the plutocrat class: its cowardice.
Some plutocrats have drunk the Kool-Aid and really believe Trump will make them richer, even as the S&P 500 tells them otherwise. But others understand that Trump’s lunatic tariff binge has started a trade war that, if we’re lucky, will cause only a recession and not a global depression. The odds of the latter will go way up if Trump carries through on his threat to default on some United States Treasuries, or if the Treasury moves forward with the so-called “Mar-a-Lago plan” that would give U.S. bondholders a buzz cut.
Yet here is what Goldman Sachs chairman and CEO David Solomon told Fox Business this week after Trump met with the Business Roundtable, an organization of CEOs:
One of the things that I do like is that the president is engaged with the business community, the administration is engaged with the business community, and that’s a different experience than what we’ve had over the course of the last four years.… I think the business community understands what the president is trying to do with tariffs. Now the business community is always going to want lower tariffs everywhere in the world. At the moment, there’s some uncertainty, the market’s digesting that, but we’re going to have to watch and see how this all plays out.
Is Solomon stupid or is he a coward? A bit of both, I think. The stupidity part is how pathetically grateful he is that Trump is (he says) more “engaged with the business community” than former President Joe Biden was. That echoes Steven Rattner’s observation in a March 3 New York Times op-ed that centrist businessmen he talked to “resented how Joe Biden kept bashing big companies” so much that “even the strong economic gains of the past four years couldn’t get most of them to back Kamala Harris.”
When did rich people become such delicate flowers? The Gilded Age financier Jay Gould understood himself to be the most hated man in America. He didn’t care because he was also one of the richest. Gould’s fellow robber baron Cornelius Vanderbilt felt the same way. Today’s plutocrats don’t just lack the thick skin of their forebears; they’re so desperate to be loved that they’d rather take a smile and a cookie in the Oval Office than a bull market in the stock exchange.
The fear part of Solomon’s statement to Fox Business is the groveling—almost apologetic—way he discusses Trumps tariff policies. He shrugs off the business community’s opposition to arbitrary trade restrictions as a matter of taste. (Some people don’t like cilantro, we don’t like rando tariffs.) He says the business community “understands” what motivates Trump’s tariff binge, thereby implying that it has something to do with leveling the economic playing field in trade, when in fact Trump’s rationale is ever-shifting: from unfair trade practices to illegal immigration to fentanyl deaths to annexing Canada to dismantling the European Union.
What really motivates Trump’s tariff mania—beyond the very real possibility that his brain has turned to lukewarm gazpacho—is his crackpot ambition to replace the progressive income tax with tariff revenue. This is the motive hiding in plain sight within Trump’s inaugural address: “Instead of taxing our citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens.” Trump’s refusal to give up on creating what he calls an “External Revenue Service” to “collect massive amounts of money” in tariffs (that was also in Trump’s inaugural speech) is why Trump keeps imposing tariffs in every direction even as the stock market takes a swan dive.
A few hours before the Business Roundtable’s Trump meeting, many of the same CEOs met a few blocks away with Jeffrey Sonnenfeld, a professor at Yale’s School of Management. They didn’t tell Sonnenfeld they understood what the president was trying to do with tariffs. They voiced, in private, what Sonnenfeld described to The Wall Street Journal‘s Chip Cutter and Lauren Thomas as “universal revulsion against the Trump economic policies.”
Only a few CEOs—Cutter and Thomas cite Chevron’s Mike Wirth, Alcoa’s Bill Oplinger, Target’s Brian Cornell, and Walmart’s Doug McMillon—have objected publicly to Trump’s economic policies. As Cutter and Thomas note, chief executives weren’t such fraidy cats during Trump’s first term. Back then, CEOs like Apple’s Tim Cook and JP Morgan Chase’s Jamie Dimon were out front not only criticizing Trump but urging others to do so. “Our jobs as CEOs now include driving what we think is right,” Brian Moynihan, CEO at Bank of America, told the Journal’s Monica Langley in 2016. “It’s not exactly political activism, but it is action on issues beyond business.”
Nine years later, Moynihan is still CEO at Bank of America, but he’s no longer calling his fellow chief executives to the barricades. That may have something to do with the tongue-lashing Trump gave him at Davos earlier this year for not lending enough to conservative organizations (an implausible accusation that Bank of America denied). Trump leveled the same accusation at Dimon (and JP Morgan similarly denied it). Dimon issued some strong words following the January 6 insurrection, but he changed his tune in 2024, praising Trump’s economic policies and later joining the long list of wealthy or otherwise prominent Americans scared off from endorsing Democrat Kamala Harris in 2024. Although Dimon toughened his tone this week, as late as January he was advising people at Davos that Trump’s tariffs were “a little inflationary” but “good for national security … I mean, get over it.”
“I’ve been struck by how fearful people are and how unwilling they are to speak out,” Bill George, former CEO of Medtronic, told the Journal.“That has just not been true in the past.”
On Thursday the S&P 500 closed 10.1 percent down from its February 19 high. On Tuesday, Sonnenfeld asked his CEOs how far the stock market would have to fall before they spoke out against Trump. Forty-four percent said it would have to fall 20 percent, and 22 percent said it would have to fall 30 percent before they’d open their mouths. Nearly a quarter said they’d keep their mouths shut no matter what.
But sucking up to Trump imposes costs too. “The same choices that help a CEO score a dinner invite to Mar-a-Lago may spur investigations in Brussels and boycotts in Toronto,” noted Nick Merrill and Dan Schwerin earlier this month in Fast Company. They also pointed out that foot traffic at Target dropped 10 percent after it dropped its DEI requirements, even as foot traffic at Costco, which did not, remained stable.
What are these oligarchs afraid of? The same thing oligarchs in Russia are afraid of, I suppose: persecution by an authoritarian leader. But the threat is significantly less fearsome here. In Russia the preferred punishment is defenestration. In the United States, it’s perhaps an antitrust complaint or a canceled government contract.
Granted, things will get rougher, with politically motivated tax audits almost certainly on the way. William Paul, the top lawyer at the IRS, got himself fired yesterday for refusing Elon Musk access to taxpayer records. It doesn’t take a lot of imagination to guess why Musk wants taxpayer records. Richard Nixon compiled an enemies list and handed it to the IRS; at least one of the people on that list was audited as a result. During Trump’s previous term, former FBI Director James Comey and his deputy, Andrew McCabe, were both audited after they were fired. I don’t believe it’s coincidental that Trump had earlier asked his chief of staff, John Kelly, to get the IRS to audit them, according to Kelly. Kelly refused, but Trump apparently got his message through. (Comey and McCabe didn’t become aware of the audits until after Kelly left the White House.) Kelly said he told Trump, “It’s inappropriate, it’s illegal, it’s against their integrity, and the IRS knows what it’s doing and it’s not a good idea.” According to Kelly, Trump replied: “If it’s morally wrong and violates the law, then of course we mustn’t do it.” Just kidding. According to Kelly, Trump replied: “Yeah, but they’re writing bad things about me.”
Plutocrats are especially vulnerable to tax audits because they’re richer and because they have many more opportunities than most ordinary mortals to cheat. So perhaps that threat is enough to silence them. But the price of their cowardice is that they’re letting Trump wreck the economy and set their portfolios on fire. If being a billionaire turns you into a tremulous little milksop, well, there’s yet another reason I’m glad I’ll never be one.
