Bloomberg Opinion's Gautam Mukunda explains why CEOs should stop "outsourcing" politics. Mukunda's opinions are his own.

Gautam Mukunda, writing for Bloomberg Opinion, contends that CEOs need to be more informed about politics rather than making themselves the focus of political debates. He notes that while there is a long history of CEOs engaging in politics, current conditions mean that becoming too politically vocal can alienate large segments of the public or even backfire entirely, as seen in the case of Elon Musk. Mukunda advises that CEOs should prioritize understanding political dynamics over public political engagement, as governments are intervening in markets in unprecedented ways and traditional assumptions may no longer hold.

Mukunda also points out that while some CEOs, such as Jamie Dimon, have successfully navigated political waters with sophistication, the risks of deep political involvement are significant. He references historical figures and changing power dynamics to illustrate how the relationship between business leaders and politics has evolved, emphasizing that today's environment requires a careful, knowledgeable approach rather than outspoken activism.

Why CEOs should stop 'outsourcing' politics

So what I said is CEOs need to be more knowledgeable about politics, right? And there is a big difference there. There's a long history of CEOs being involved deeply in politics in lots and lots of different ways. You have big institutions that were created just for that. But when CEOs make themselves the political story, especially in this time, they're gonna make half the country enemies. And if they do it the way Elon Musk has done it, they're gonna make everyone in the country their enemy, which is not good. So he needs knowing more and speaking less was sort of the advice that I would give him right now. This might be a dumb question, but what's the advantage of knowing more about politics? Why? Governments are intervening in markets and acting in ways that they have not historically in generations. So American business people in particular have a set of reflexes about the way the US government will act within very normal bounds. Those reflexes are all taking you astray right now. They're all just wrong. They're not accurate. And that's true for other governments too, right? We're seeing major wars in Europe, major wars in the Middle East. If you are deeply sophisticated about politics, if you could know a lot more about that, you might have some ability to see around corners that a normal CEO who just figures the politicians will do their thing just won't have. But then there's, I guess, the balance that you have to have of not actually getting involved in that. Some would look at someone like Elon Musk and say, I mean, if anyone could see around corners, I mean, given that his perch in the White House and on the Trump campaign, he would know exactly what was coming around the corner. But of course he inserted himself in a lot of things at least for certain consumers of his, they were not necessarily on board with. Yeah, I think what we saw with Doge was Elon Musk plunged deeply into politics without doing a lot of the background reading is the way I would put it. It turns out that a lot of these institutions are in fact pretty delicate and take a lot of deep technical knowledge to manage. And if you bring in people who are 23 and ask them to fire people based on AI and keyword searches, things are gonna go wrong. Musk's track record of success in lots of places, it's not portable. You can't say just because I've succeeded in area X, that means I can succeed in area Y. You've gotta do the work and build the base of knowledge. And he seemed to plunge in without doing that. With regards to just being politically aware, there's awareness of long-term structural changes. There's also awareness of a lot of the short-term things, which some people would dismiss as noise. And I would assume, I don't know, you tell me your opinion, but I would assume that you don't necessarily want your CEO reacting to the short-term noise, or do you? So only someone who has sort of a deep knowledge of the field is gonna be able to tell you what's the noise and what's the signal. And so just as we would never hire a CEO who said, well, I don't really know what's happening in the markets and I don't care and I don't pay attention. Well, for three generations, that was fine, if you said that about politics, if you're an American CEO. It's just not fine anymore. The world has changed and we need to catch up to it. I'm gonna ask you kind of a loaded question, but it's the idea that, particularly in this particular environment, given, and we're primarily talking about the US here, given the way this White House works, isn't there an advantage to maybe being more active in politics for certain CEOs? Yeah, you've clearly derived, there are CEOs who've clearly derived significant benefits from that. And at least in the short-term and maybe in the long-term, depending on how politics plays out, that could be very rewarding for some companies. But you're definitely upping your risk. Working, there's a very, very long list of people who thought that they could work closely with Donald Trump and manage Donald Trump, who Trump has turned on. What Elon Musk has learned in the last few weeks is something that I think, again, someone who's deep in politics really told them, if you are the richest, most powerful business person in the world, which he definitely is, you're still a pygmy compared to the President of the United States. When you look at the CEO slate out there now, and really, and even to go back to the first Trump administration and the CEO slate then, is there anyone that stands out to you that maybe did it right, that found a way to sort of navigate the somewhat volatile politics without necessarily upsetting the President and at the same time, not necessarily upsetting their consumers and investors? The easiest answer is Jamie Dimon. He understands politics at a level of sophistication that very few people, even in the financial sector, but just broadly, do. And even when he puts a foot wrong, which everybody does once in a while, he's built up such a reputation and such credibility that he can get out of that problem relatively easily. I mean, it's the cliched answer, but there's a reason it's the cliched, because it's usually right. Yeah, he's usually right. I think some people might put Tim Cook in that basket as well, although things are a little shaky nowadays. Go back in history, though, because again, we talk about this idea, Paul, and I think back to the CEOs that kind of came out of the Industrial Revolution, obviously the big titans, whether it's the Carnegie's or J.P. Morgan, speaking of Jamie Dimon, they were political animals. They were. In a lot of ways. And somehow it worked for them. I don't know if maybe it worked for them because they were monopolists, but all joking aside, it did seem like there was an era of CEOs in this country where they were, maybe by mandate, just by the nature of what was going on in the world, they had to be very politically active. So they did, but step back, right? So if you go back to the Theodore Roosevelt administration, like the early 1900s, the president of the United States was first, at most, first among equals among American leaders. He wasn't the dominant figure that you see the president as today. That is a creation, in fact, of Theodore Roosevelt. And so famously, when he started doing antitrust investigations of J.P. Morgan, Morgan sent him a note and said, if you have a problem with what I'm doing, send your man to my man and they'll work it out together. By your man, he meant the Attorney General. So in Morgan's view, he was a peer of the president and his corporate counsel was a peer to the Attorney General. And a big part of what Theodore Roosevelt did was establish that that was not true.

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