Trump is becoming a liability for capitalism

Wonderful Confederate culture and beautiful racist statues. Are these the things upon which the fate of the Donald Trump presidency rests? If the last few days are any indication, there is a distinct possibility it could be true.

The massive street protests against fascism and the efforts of some Republican accomplices to distance themselves from the Charlottesville Nazis are worries for Trump to be sure, but presidents have survived big demonstrations and the criticism of allies before.

The strongest immediate threat to Trump’s power now is the spreading of rebellion in his own ranks, and that doesn’t necessarily mean among his hardcore base, as one poll indicates some 60 percent of Republican voters still stand by their man. Rather, it is among the titans of American business, the military brass, and the political establishment—the power centers of the capitalist state—where Trump’s stock is falling fastest.

The exodus

The exodus of corporate CEOs from his economic advisory councils proceeded at such a pace this week that the president was forced to announce the bodies were being disbanded. He claimed it was to save the chief executives from pressure; they said the debate over their collaboration with Trump had “become a distraction from our well-intentioned and sincere desire to aid vital policy discussions.” It was a polite way of saying, “There was no way we could continue to be connected publicly to this guy.”

For many of these business leaders, their public divorce from Trump is not something they embraced eagerly. If only he could control his Twitter impulses and refrain from saying anything positive about Nazis, they’d certainly be happy to continue cooperating in advancing his agenda of deregulation, tax cuts, and infrastructure spending that amounts to corporate welfare.

But, alas, Trump simply cannot control himself apparently. Jamie Dimon, CEO of JP Morgan Chase, said in an email to employees on Tuesday that the president’s “constructive economic and regulatory policies are not enough and will not matter if we do not address the divisions in our country.” Read that again: “constructive economic and regulatory policies.” The rest of Trump they like, it’s just his open embrace of white supremacy that is fouling things up.

Its not just the Fortune 500 crowd who are running from Trump, though. In an open and stunning rebuke of their commander-in-chief, the heads of all four branches of the U.S. military—the Army, Navy, Air Force, and Marines—issued back-to-back coordinated denunciations of racism. Military historian Fred Kaplan described the situation in stark terms: “If we lived in a different sort of country, this could fairly be seen as the prelude to a military coup—and a coup that many might welcome.”

On Thursday, Trump lost the backing of a top Republican senator widely respected by both political parties. The words of Sen. Bob Corker of Tennessee verged on branding Trump unfit for office. “The president has not yet been able to demonstrate the stability nor…the competence that he needs to demonstrate,” he said in Chattanooga.

Corker joins a short but growing list of GOP senators, including Marco Rubio of Florida, John McCain of Arizona, and Lindsey Graham of South Carolina, who have called Trump out by name in recent days. Speaker Paul Ryan and Senate Republican leader Mitch McConnell have so far continued to dither, denouncing racism in general but not the president himself.

Trump is bad for business

There now appears to be a consensus emerging among at least a section of American capital and within the echelons of state power that Trump (and any prominent association with him) is a liability.

Few CEOs were ready to call him out as a white supremacist directly in the first day or two after Charlottesville, but the president’s repeated expressions of sympathy for the Confederate cause and his praise for the cultural value of monuments to slavery are making it unavoidable.

Even some of the most pro-Trump corporations are feeling the pressure to cut ties. James Murdoch, head of Twentieth Century Fox and son of Rupert Murdoch, said in an email Tuesday night, “I can’t even believe I have to write this: standing up to Nazis is essential; there are no good Nazis. Or Klansmen, or terrorists.”

A sort of united front of capitalists is even emerging, as executives band together to oppose the president so that no single one of them alone has to face the fallout from a Trump attack like the one launched at Merck CEO Ken Frazier, an African American, after he quit the president’s manufacturing council.

The conclusion many are reaching: Trump is bad for business.

The façade of a post-racial America is an essential one for capitalism in this country. No doubt many CEOs fervently oppose racism at a personal level. But at the macro-scale, the dredging up of the realities of systemic racism and the possible broaching of the topic of how big business benefits from the super-profits that come from racial inequality is a threat to the whole capitalist class.

Because if he has accomplished anything, it is this: Trump has blown apart the idea that the United States has moved past racism or that discrimination is a relic of our troubled past. By emboldening white supremacists and fomenting racial animosity on the part of white workers, he has exposed the tactic of dividing working people by race. The threat for capitalism is that more people begin to put together the pieces and realize that it’s not only Trump who is the problem, but the system itself, which thrives on built-in racial divisions.

As a New York Times article on Thursday put it, “Comparing the Trump administration to the Nazis may be a stretch, but many business leaders are concerned that stirring up deep-seated racial and nationalist animosities could be destabilizing, leading to riots, property damage, and widespread civil unrest reminiscent of the late 1960s.”

“Fomenting racial unrest,” in the words of Jeffrey A. Sonnenfeld, a Yale University management expert, is “not in businesses’ interest.” He’s right in more ways than one. Unrest is of course bad for markets, but increased mass awareness of racial disparity also spells trouble for the system. Pair this with the rapid growth of socialist ideas among the young generation, and the future starts to look a bit worrisome.

The threat for capitalism is that more people begin to put together the pieces and realize that it’s not only Trump who is the problem, but the system itself, which thrives on built-in racial divisions.

The abandonment of Trump by the powerful is not a completely novel phenomenon. A certain section of the capitalist class was always against him. The prolonged economic crisis and the increased differentiation of capital between globally-oriented sectors like finance, high-tech, and energy on the one hand, and domestically-oriented small and medium capital in sectors like services, small manufacturing, and regional energy exploration on the other, have unsettled the old political coalitions that alternated in governing the American state.

The divisiveness of the Republican primary last year was evidence of this uncertainty. Of course, once Trump—who rallied the support of globalization’s losers, such as white workers from the so-called Rust Belt, small manufacturing, and medium-sized capital—secured a lock on the nomination, other Republican-leaning business elements got on board. This included big oil, resource producers, and slivers of several other sectors.

While internationally-focused sectors such as finance and high-tech largely coalesced around the Clinton campaign, a number of actors in these groups also expressed an openness to working with President Trump once he was in office. They certainly would have preferred someone not so verbose about closing borders or restricting trade, but they also knew they weren’t necessarily dealing with a man of principle here. There was always wiggle room with Trump.

The reign of the “businessman’s president” proceeded apace, at least on the surface. Two regulations dropped for every one new one. The push to privatize education. Repealing Obamacare to boost the bottom line of insurance companies. There were many proposals that would put a sparkle in a CEO’s eye.

But unfortunately for them (and fortunately for the rest of us), Trump proved to be supremely incompetent at navigating the terrain of coalition politics necessary to pass major legislation in Washington. The intense pressure being put on elected officials by a mobilized and outraged public—the Resistance—also didn’t make it any easier to push through the president’s major proposals. The emergence of one scandal after another didn’t help either.

Splits in the executive committee

But now, all bets appear to be off. The wall on the Mexican border wasn’t enough. The ban on transgender military service wasn’t enough. The possible collusion with Russia in the elections wasn’t enough. Even the threat to launch a nuclear holocaust wasn’t enough. But openly and repeatedly defending a neo-Nazi and KKK march that cost one woman her life is finally the bridge too far.

The exodus from Trump has begun. Where or when it will end is not yet clear, but the likelihood of his presidency lasting for a full four-year term is diminishing by the day.

Most reluctant to abandon the president are the companies which heavily benefit from their direct connection to the government—defense suppliers like Boeing or energy giants such as ExxonMobil. Those more dependent on the whim of consumers fed up with racism, like athletic clothing retailer Under Armour, have been some of the quickest to bolt.

The turmoil is now spreading into the heart of the administration, as rumors swirl that Gary Cohn, former Goldman Sachs CEO and the head of the National Economic Council—the president’s top economic policy-making body—may soon resign. The mere suggestion that he may step down sent the stock market into a panic on Thursday.

And it would seem that even Trump is perhaps realizing, belatedly, that he and Steve Bannon may have gambled and lost this time. They pushed the envelope on the Confederate statue issue, assuming it would cause enough distraction so that they could advance the rest of their agenda. Bannon, for instance, has reveled in the controversy surrounding the monuments and pushed for more confrontations in the streets. “Just give me more. Tear down more statues, say the revolution is coming,” he said this week. “I want [Democrats] to talk about racism everyday. If the left is focused on racism and identity and we go with economic nationalism, we can crush them.”

Instead, Trump’s effort to fan the flames of racism are backfiring. And it appears that Bannon the Svengali will pay the price for leading his boss astray. As this article goes to press, news is breaking that Bannon’s firing is imminent.

Karl Marx and Friedrich Engels once declared that “the executive of the modern state is but a committee for managing the common affairs of the whole bourgeoisie.” It may sound a bit simplistic given how complex the machinery of power has become, but they were onto something. The chasm opening up between Trump and those who hold the levers of economic, military, and political power demonstrates that there are splits within Marx’s infamous “committee.”

The task now is to take advantage of these splits and push for the ouster of a Nazi sympathizer from the White House and deliver a powerful blow to not only the racism he supports, but to the agenda of deregulation, privatization and tax cuts he’s been pushing—an agenda which threatens the well-being of working people of all races and nationalities.