During the weekend, Donald Trump’s comfort of a more generous approach to prices has been reversed again, Apparently return to Draconian prices of 20%. The president imminent Announcement of the “Liberation Day” of Rose Garden of universal prices on everything that comes in everyone’s United States – accompanied by the Trump 10% decreaseOn the stock market in the last month, is just the latest example of the way in which Trump’s capricious price crises direct the American economy directly from the cliff. Given the almost unanimous choir of business leaders and economists, you have to ask yourself what motivates Trump’s destructive decrees. As Trump himself confessed this weekend NBC, “I don’t care if the prices of cars increased!”
The problem is not prices – the problem is Donald Trump, clear and simple. According to our Caucus PDG survey results, 90% of CEOs actually support the pricesWhen used strategically and selectively. These business leaders support the use of selective prices to rectify real commercial imbalances and limit foreign spills to the United States, undermining American producers in sectors such as steel.
But these worthy objectives often seem to be subjected to vendettas focused on the personality of Trump, like punishing long NEMESIS Justin Trudeau; And more importantly, the idiosyncratic and capricious deployment of Trump prices has completely imposed for companies to invest, hampering Trump’s declared objective to bring investments and jobs to the United States
Already, there is a confusing range of 12,500 tariff categories in 200 business partners. We counted Trump’s pricing declarations in the past two months and Found no less than a file of 107 instances Paradoxical flip -flops on pricing policy, often with inversions the same day. This does not even take into account the often contradictory advice of Trump deputies, who are then canceled later by Trump himself.
Companies need predictability and stability; No company can authorize billions of capital expenses to build new factories or hire new workers when commercial policy changes day after day, no hour per hour, but in some cases, literally minute per minute. During our caucus of the CEO of Yale this month,, The CEOs groaned and cried each time Eamon Javers de CNBC has read a new reversal of pricing policy, with seven flip flops on our three -hour event.
Trump defenders argue that all of this is part of his “art of agreement” – to strike the counterparts with the hard face that they are unbalanced and implanted completely for an agreement. But the reality is that Trump gets out in these transactions, because companies only recondition existing capex expenses in “announcements” of “new investments” in the United States, the plating of Glitz and the Glamor of Fawning Oval Bureau Conferences announcing these new investments as a great reality, $ 10 billion Electronics Factory in Wisconsin turn into abandoned shadows And Slowing plants. Meanwhile, leaders and foreign companies offer tokens concessions with few real advantages for the United States, while racing Avoid prices by reducing supply chains in neutral countriesBreathly defying and openly Trump while paying the lip service to his whims. This is why 90% of CEOs were questioned during our CEO of Yale, Caucus
These CEOs, like everyone else, envisage many data pointing to the widespread ravages by Trump. Not only have Trump’s botched tariff attacks contributed to cutting around 7 billions of dollars of value on the stock market since its inauguration – everything to finance the government for an entire year, but costs are felt in the real economy. Far from bringing manufacturing and jobs to the United States, Trump kills American manufacturing, hurts American workers and dropped the whole American economy with him. Inflation expectations have jumped 32 years old; Consumer confidence has Immersed 25% both at the University of Michigan and in conference forums because consumer spending fall Most of five years; Nfib the confidence of small businesses plunged 50%; The labor market is deteriorating as the number of new Quadrupled layoffs in the last three months; Capital expenditure and investments have stopped; and GDP growth Forecasts fell by 1%– A reversal of the economic fortune at the head as the initial euphoria of the commitments of tax reductions of Trump and deregulation was transformed in the Monster of Frankenstein of all the prices, all the time.
Of course, many business leaders wonder what motivates Trump’s destructive tariff crises. On the one hand, Trump has been obsessed with prices since at least the 1980s; And he has long considered in reductionality the American balance of trade as if he always directed the Trump organization, which tries to sell more than it buys each year. But intentional pure, avoidable and intentional chaos of Trump’s pricing deployment, and its desire to ignore important stock market titles, suggest that there may be other explanatory factors. Some CEOs have suggested in private that Trump could try to induce a recession at the start of his mandate to “clean the bridge” long before the mid-term elections, although this requires greater installation for long-term strategic providents than what is generally associated with Trump. More likely, maybe Trump has no plan and only do things on the fly, with arbitrary megalomaniac impulses without constraint by the staff of men.
In Trump’s anger attacks, psychoanalysts could find a strong resemblance to what Sigmund Freud called the pathology of the “death of death” of entrepreneurs, or what psychiatrists call the self -destructive impulse – to a child on the beach that builds a beautiful castle and bandaged.
Forty-two years ago, Abraham Zaleznik, a psychoanalyst management scholarship holder at the Harvard Business School, explained that Several times, entrepreneurial leaders that Trump and Musk are motivated by a megalomania ultimately self -destructive, rooted in a bad relationship with a parent who denigrated them but who are no longer there to get wrong. Zaleznik declared“In their ascent towards the summit, they have certain fantasies linked to the creation of a new world. There is a search for restitution – to redo the world, redo their childhood, redo a relationship with a parent. They are practical to Midas theory. Everything they touch will turn into gold, and if not. They both have an underdeveloped super-ego.
Trump’s “Liberation Day” has become a nightmare for American companies. The real liberation that the American economy needs is a more orderly strategic approach to prices, released from the idiosyncratic whims of Trump.
Jeffrey Sonnenfeld is the lester crown professor in management practice and main partner with the Yale School of Management. Steven Tian is director of research at the Yale Managing Director Institute. Stephen Henriques is principal researcher at the Yale Managing Director Institute and a former McKinsey & Co.
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