CNBC reported on Tuesday that John Watson, Chevron’s CEO, supports Donald Trump’s push for corporate tax reform.
And this is news?
Let’s ignore the merits of corporate tax reform. This post isn’t about politics or economics. This post is about what the financial media considers news.
It’s hard for me to think about something that’s less interesting than a big oil CEO saying he’s in favor of reducing corporate taxes. There are a million incentives for him to say it. And there’s practically no incentive for him not to say it.
There’s zero risk in a big business CEO publicly taking this position. The CEO works for the shareholders. Every dollar that doesn’t go to the government goes to shareholders. The dollar either gets reinvested in the business, which should fuel future growth. Or the dollar can be used for share repurchases or dividend payments. Either way, shareholders win, assuming management is competent.
The tax reform part of the CNBC interview is financial cable news at its worst. It’s getting high profile people to make obvious statements with zero consequence. No one learns anything by listening to or reading the commentary. It’s a script that has been played out a million times, with a million different executives. And yet cable news keeps going through these motions, and keeps publishing these stories as if they’re news.
It’s an example of how difficult it is to learn anything by listening to senior executives speak. All humans are risk averse. Humans with 7 or 8 figure compensation packages are particularly so.
The chance that a high profile executive will say something interesting on CNBC is practically nil. The risk is way too high. It’s much safer to stick to boilerplate stuff. Say something a little provocative, and you’ll have to answer questions from angry shareholders. Who wants that?
That’s one of the challenges of finding helpful mentors. Of course it’s nice to win the affection of high profile, successful people. But it’s difficult to build enough trust to have real, candid conversations. There’s such a huge status gap between them and whoever they’re trying to mentor. Plus, executives got to where they are in part by minding their reputation. Once in a position of prominence, they place a premium on protecting their reputation. That’s why you see a lot of prevent defense at that level.
Want to learn something interesting? Find someone whose brand is built around provocation. Find someone without status. Or without the kind of status that requires polite social approval. Find someone who values curiosity over conformity.
Who am I talking about? The insightful manager that misses promotions because she doesn’t travel in the right professional circles. The compelling author who struck out on his own because his ideas ruffled too many feathers in the office. I’m talking about people whose definition of success doesn’t demand broad public acceptance.
It’s clear why CNBC invites big name CEOs to talk about their businesses. They’re generally very smart people. They’re wealthy. They’re successful by any standard definition of professional success.
But the conversations are banal. It’s high status people talking about topics that come nowhere close to threatening their status. A big oil CEO likes the idea of corporate tax reform? I’m shocked. In the world of the financial press, though, even something this uninteresting counts as news.