Several university leaders have expressed shock when actions by Donald Trump and his 2.0 administration officials have gone directly counter to what he and his appointees supposedly learned during their business-related college education. But, what do professors know?
I’ve been privileged to teach and serve as a marketing department head at an Association to Advance Collegiate Schools of Business-accredited institution; only 6% of business schools worldwide achieve AACSB recognition.
As such, one gets to know the multi-year process that third-party evaluators, which include corporate executives, use to rigorously examine the curriculum offerings of accounting, economics, finance, management and marketing — and, subsequently — what principles well-trained business students should exemplify.
However, when business leaders of Fortune 500 companies are alarmed when Mr. Trump and his 2.0 administration ignore basic business principles, it then becomes an even more salient, noticeable and damaging judgment on our 47th president and his allegedly business education-trained appointees.
Let’s explore some of the business principles taught at AACSB-accredited institutions and revered by executives but are being ignored or abused by Mr. Trump and his acolytes.
Executives’ perspective of Trump 2.0
Recently, dozens of top Fortune 500 executives, primarily Republicans, met at the Yale Chief Executive Leadership Institute’s CEO forum and expressed “worry that Trump is undermining an economic system that took decades to build … all for short-term gains … a hallowing out of U.S. economic foundations and institutions.” (Fortune, Sept. 21).
CNBC reports many of Trump appointees regularly disregard expert business advice and have abandoned evidence-based business principles, harming in just 325 days of Trump 2.0, the following industries: agriculture, automotive, construction, consumer goods, manufacturing, mining and retailing.
This begs the question: what industries have not been harmed by Trump 2.0?
Econ. 101
Concepts such as stable markets, free competition and long-term business investment are taught in a freshman-caliber macro-economics class. Yet evidence is replete Trump’s policies are undermining these core concepts.
CEO’s have described the administration’s approach as politically driven and disruptive to the most basic of business fundamentals (Fortune, July 10).
CNN reports a lack of strategic planning and erratic policies under Trump 2.0 have resulted in economic instability, market volatility and an environment equivalent to “zero-trust,” which goes counter to the cardinal premise of maintaining a steady domestic and international business environment.
Econ. 102
The topic of tariffs is taught in a freshman-level micro-economics class and reinforced in other sophomore, junior and senior-year business classes.
It’s a sad commentary that Mr. Trump, et al, doesn’t recognize that imposing tariffs disrupts business supply chains, increases input costs, reduces gross margins, stockpiles unnecessary inventory, increases cash-flow risks and reduces profitability, let alone dramatically increases the cost of products, goods and services that consumers are forced to pay (American Economic Liberties Project, Aug. 1).
Forbes and Newsweek report 12 GOP Senators have publicly acknowledged that tariffs are a tax on consumers (Capito-WV, Collins-Maine, Cruz-Texas, Grassley-Iowa, Kennedy-LA, McConnell-KY, Moran-KS, Mullin-OK, Murkowski-Alaska, Rand-KY, Thune-ND and Tillis-NC).
Philip Kotler, revered business thinker, noted the broad use of protective tariffs favors short-term political gains rather than sound economic and competitive advantage business fundamentals (ActivistsBrands.com, Feb. 13).
Given the result of Mr. Trump’s 2017-2021 tariffs and current tariff debacle, he and his appointees most likely failed tariff-related examinations while in business school.
Marketing
Trump 2.0 administration’s deregulatory stance on digital advertising and privacy regulations risks reducing consumer protections, which contradicts modern marketing principles that emphasize ethical data use and respect for customer privacy (Basis, Feb. 26).
The marketing concept of “caveat emptor” — buyer beware — is more alive under Trump 2.0 than at any other time in history.
Accounting
The Foreign Corrupt Practices Act requires publicly-held companies to maintain accurate records.
Trump’s 2.0 executive order paused FCPA enforcement, which undermines the foundational accounting principle of internal controls, accurate record-keeping, transparency, ethical conduct and — most importantly — increases the risk of financial misreporting and corruption (Morgan, Lewis & Bockius LLP, Feb. 12).
Mr. Trump and his administration officials probably did not do well in sophomore-level cost accounting and managerial accounting college courses.
Overall Trump-era policies
Many business school faculty members have explicitly opposed Trump-era policies, noting the administration’s executive decisions reflect poor strategic and ethical judgement that contradicts the basic tenants of business organization and critical thinking (Harvard Business School).
Business leaders are convinced that principles such as free enterprise, accountability, transparency, conflict of interest, ethical governance, risk management, compliance, tariff trade practice, market stability and long-term strategic planning have been breached under Trump 2.0 leadership.
Throughout Yale’s top Fortune 500 executive forum, CEO’s expressed how the fundamental college-level business education principles Mr. Trump and his officials should have learned in college are being ignored.
The final resolve of the Fortune 500 CEO’s forum was a call — and plea — to make America, America again.