Does Government Really Regulate Industry, or Is It the Other Way Around?
This is a book review. Now that the election is over, I’ve got a book of my own to write. The Revivalist Agenda, which will be my third political book, is going to come out in late January or early February, and as I gear up to crash it out, I’m looking for the best inspirations and source material as fuel for it.
The Revivalist Agenda is a book about the future — as the book it’s a sequel to, , was mostly a book about the past. Getting a very clear view of the past is crucial, however, to understanding the future. (READ AN EXCERPT: Weaponized Governmental Failure: A Primer)
We’ve forgotten a lot about our past. People in positions of authority have wanted it that way and they’ve imposed a false understanding on us which (1) doesn’t work and (2) was just repudiated last week.
But there are some very good books out there that provide more clarity. I found one.
Ronald Reagan once declared, “Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” But it wasn’t always this way. In The Power and the Money: The Epic Clashes Between Commanders in Chief and Titans of Industry, author Tevi Troy expertly lays out how the relationships between our nation’s presidents and CEOs have developed throughout history.
You’ll have a far broader understanding of how power and influence shape policy once you’ve read this book.
Troy illuminates the trajectory of increasing governmental regulation of businesses, thus providing, “a cautionary tale of what happens when the federal government gets too big and too enmeshed in the activities of the producers and innovators in our economy: our costs go up while our freedom diminishes.” This explanation, demonstrated through case studies of various president and CEO relationships, illuminates how our government has arrived at its taxing, regulating, and subsidizing attitude toward businesses, as Reagan warned of long ago.
The book covers extensive swathes of American history, while simultaneously introducing us to a host of unforgettable characters. This cast includes well-known presidents, such as Franklin D. Roosevelt, John F. Kennedy, Barack Obama, Donald Trump, and Joe Biden, and also lesser-known ones, such as Rutheford B. Hayes, William Taft, Warren Harding, and Calvin Coolidge. Alongside them, the reader meets the giants of the American economy, including Rockefeller, Buffett, Gates, Musk, Jobs, Zuckerberg, and Oprah, while also encountering less familiar ones like Henry Luce, Lew Wasserman, Katharine Graham, and Jack Welch.
Troy starts his story during President Ulysses S. Grant’s tenure when CEOs John D. Rockefeller and J.P. Morgan’s businesses were booming. There was little to no regulation of businesses by the government, including Rockefeller’s Standard Oil and Morgan’s Drexel Morgan. Nonetheless, their enormous success, questionable modes of operation, and monopolization of industries soon attracted the federal government’s attention.
Soon, laws like the Sherman Antitrust Act, signed into law by President William Henry Harrison in 1890, were being enacted, and Rockefeller and Morgan realized that a positive relationship with the president would have beneficial effects on their business prospects. A president, when favorably disposed to them, could delay laws, subsidize funding, and generally advance the interest of companies.
But the adverse possibility was a frightening one.
A rough relationship between a president and a CEO could result in a number of unpalatable consequences for the businessman. Firstly, government investigations could result in the breaking up of corporations, such as Rockefeller’s Standard Oil at the instigation of Teddy Roosevelt. Moreover, it could also result in the CEO losing advantageous political contacts in the capital, and attracting negative attention from regulators in the process. Elon Musk is experiencing this now.
As the Musk example shows, Troy’s narrative continues all the way up to the present day, when the reader is granted a front-row seat to Obama, Trump, and Biden’s dealings with the well-known magnates of our day. The modern phenomenon of Big Tech propelled the significance of president–CEO relations to even higher heights. In our day and age, when the government has notable regulatory power over businesses, these Big Tech CEOs are almost required to have a presence in the nation’s capital. As Troy recounts, “When Gates met Zuckerberg, he gave him clear and stark advice: ‘Get an office there, now.’”
The importance of these relationships becomes even more apparent around election time, as demonstrated by Obama and Zuckerberg’s dynamic. Indeed, Obama’s sizeable social media presence led his “2008 campaign to be dubbed ‘The Facebook Election.’” Obama was more than happy to give credit where credit was due in a 2016 Global Entrepreneurship Summit at Stanford University when he shared the stage with Zuckerberg.
The writing throughout the book is superb, entrancing the reader further into the world of power and money. Troy has a special knack for knowing how to incorporate plenty of juicy facts and anecdotes, which further engages the reader. For instance, on one occasion, when President Johnson summoned Katharine Graham, publisher of The Washington Post, to berate her about a specific article, he happened to be undressing for bed: “When he reached his underwear, he sensed her discomfort and barked, ‘Turn around!’ then continued the tongue-lashing with her back turned to him.”
In another vignette, during the closing of the 2011 Facebook Live event that the company hosted for the White House, Troy explains that “Zuckerberg thanked Obama by giving him a Facebook hoodie. Obama responded jokingly, ‘This is a high-fashion statement right here. This is beautiful.’”
Through a mix of striking storytelling and impressive analysis, Troy is able to get his point across clearly: the federal government’s regulatory policies have continuously encroached on the country’s largest corporations and their CEOs. The biggest losers in all of this, Troy opines, are the American people. In fact, government regulation can actually be helpful to these CEOs, while small businesses and regular Americans could not even begin to fathom having a transactional relationship with the commander-in-chief to press business concerns or alleviate troublesome regulations.
These president–CEO relationships aid the latter in killing or redirecting unfriendly legislation or receiving special fiscal favors. These connections have resulted in, “Elon Musk getting helpful funding for Tesla during the Obama administration, Lew Wasserman prevailing on Ronald Reagan not to change the financial interest and syndication rules…Lee Iacocca getting a major bailout for Chrysler during the Carter administration,” to name just a few.
Troy’s The Power and the Money: The Epic Clashes Between Commanders in Chief and Titans of Industry makes for captivating reading and introduces readers to the beguiling world of power, money, and those who control it. This enthralling book is a must-read for all those interested in the intrigues, connections, and strategies of U.S. presidents and the titans of American businesses.
And yes, you’ll see a few references to it in The Revivalist Agenda early next year.
READ MORE from Scott McKay:
It’s Long Past Time to Bend the Senate to the Will of the People
It’s the End of the Obama Era in America. Good Riddance.
A Dozen Thoughts on a Historic Election
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