
How Far Will Trump Get With Shock and Awe?
Trump sought to break from the gate of his second term at top speed, executing a raft of executive orders and other directives on his first day (see Lambert’s tally for details) and even holding an informal press conference during his signing. And he’s keen to keep the appearance of momentum up. For instance, he didn’t implement additional tariffs among his opening day actions, even though that is within Presidential authority, but on his second day saber-rattled about deploying them against China and Europe.
But as most readers here know, an executive order is valid only within the ambit of Presidential authority. Trump has elicited a raft of legal challenges with more likely to follow, on some of his executive orders that smack of overreaching. Others, as we’ll show, are more on the order of press releases, to call extra attention to things he could have done via less flashy means. We’ll also look at his memorandum on OECD-driven pending changes in taxes on multinational. It’s elicited a kerfluffle among the media, when the reaction appears to be a result of having missed the earlier plot. Finally, we’ll turn briefly to Ukraine. There, many Trump-friendly commentators are concerned that he’s being cognitively captured by neocons who may succeed in keeping the US supporting the war.
Keep in mind Trump is already running into execution problems, or what in the Johnson Administration was called a credibility gap. Trump has not gotten an end to the Ukraine conflict within 24 hours of taking office. Trump has not imposed his much-noised about big tariffs on China, Europe, Mexico or Canada.1 The sanctuary city immigration raids, promised to start on Tuesday in Chicago by ICE chief Tom Homans, have yet to begin.
One way to think about the Trump show of force is that it amounts to an effort to restore the Presidential ability to use jawboning to get his way. A notable historical example, recounted in Slate:
The federal government’s ongoing collaborative role in the [labor negotiation] process was demonstrated in April 1962 when President John F. Kennedy, having talked the United Steel Workers into accepting a moderate wage increase, publicly attacked U.S. Steel over a price hike he deemed excessive (“a wholly unjustifiable and irresponsible defiance of the public interest”), forcing the steel giant to back down. According to [MIT economists Frank] Levy and [Peter] Temin, this display of muscle “helps to explain why the reduced top tax rate” enacted two years later (it dropped to 70 percent) “produced no surge in either executive compensation or high incomes per se.” Fear of attracting comparable attention from President Lyndon Johnson kept corporations from showering the bosses with obscene pay hikes.
The Wall Street Journal, in its lead story today CEOs Launch War Rooms, Hotlines to Cope With Trump’s Order Blitz, confirms that Trump has gotten the attention of C-suites. Remember, for every group like the AI overlord looking to feed at Trump’s promised $500 billion trough (which would have to be approved by Congress), there are many who are looking at having rice bowls broken, for instance, by spending cuts or unfavorable regulatory changes (recall that quite a few sectors of the economy depend on existing complexity, starting with H&R Block and TuroTax, not that they are under threat). High points from the Journal’s account:
The blitz of executive orders and memos from President Trump left business leaders—some still in the tuxedos they wore to White House inaugural galas—scrambling to make sense of sweeping changes to tax, immigration, trade and energy policies….
Many of Trump’s first-day moves were expected, and there were few details on some of the biggest topics, including deportations….
The details of any new tariff policy would be critical for companies including 3M, the American manufacturing company behind everything from Scotch tape to materials used in electric-vehicle batteries….
Many companies remain concerned about changes to immigration policies. The law firm Fisher Phillips on Tuesday launched a rapid-response immigration team….
The firm sent clients a 24-hour hotline number that they could call in the event of an unexpected immigration raid. Employees in such industries as construction, hospitality and healthcare have conducted training sessions or posted placards at front desks so receptionists know what to do—and whom to call—should immigration officials show up unannounced.
Peter Belluomini, a citrus grower in Kern County, Calif., said he temporarily lost about 70% of his harvest crew earlier this month when a local Border Patrol raid prompted many workers to lie low.
“Basically the word gets out in the community and that part of the labor force gets nervous so they’ll stay home,” he said. Belluomini added that he expected “any disruption would be temporary and short-lived.”
However, despite the whinging and lobbying, the Journal report that big business remains optimistic that Trump will be a plus for them.
Neither piece appears to allow for the fact that many of Trump’s plans are subject to being delayed or overturned by court challenges. We described the fast-out-of-the-box filings against the improper construction of DOGE, including its lack of required transparency, like keeping records that can be FOIAed. If DOGE manages to get off the ground, it is certain to face additional litigation, such as over its expected refusal to spend fund already approved by Congress, or impoundment. Note that the Trump team appears to be avoiding engaging that type of battle yet; for instance, it put a 90 day pause on foreign aid for review as opposed to (yet) trying to cancel any. Well, with a noteworthy exception:
Trump signed an executive order suspending all foreign aid for 90 days. This was the headline published by all media outlets.
Buried in the fine print was that Israel and the US-Israeli Arab shield puppet regimes of Egypt and Jordan are exempted from the order. pic.twitter.com/CWS6UHFvj8
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Originally posted on: https://www.nakedcapitalism.com/2025/01/how-far-will-trump-get-with-shock-and-awe.html