Business Potenates and US Presidents

A review of The Power and the Money

In November 1906, the US Department of Justice sued Standard Oil of New Jersey for violating the 1890 Sherman Anti-Trust Act. For decades before that action, Standard founder John D Rockefeller eschewed the cultivation of presidents and massive lobbying of Congress. A reticent man, Rockefeller felt that managing his company’s public image, much less himself, or working directly with presidential administrations on policy, was not germane to his business. This worked well with presidents such as Ulysses Grant, Chester Arthur, and William McKinley. However, when Teddy Roosevelt took office after the assassination of McKinley, one of his goals was the breakup of the oil giant, which resulted in the lawsuit.

This story, and many more from the inception of big business in the late 1860s until the present day, are covered in historian Tevi Troy’s The Power and the Money: The Epic Clashes Between Commanders in Chief and Titans of Industry. The book is an enjoyable read and is more like a collection of stories than a single narrative.

JP Morgan (the banker; the bank will come up later) figures prominently in the book. In 1907, amidst a financial crisis, Morgan served as a de facto Treasurer Secretary crossed with a Federal Reserve Chief. Working from the billiards room in his New York City mansion, Morgan organized a group that injected money into the financial system, preventing an all-out panic. Yet, to complete the rescue, Morgan was forced to coordinate with a politician he despised, Teddy Roosevelt.

Henry Ford’s evolution from a small auto manufacturer to an invaluable government contractor mirrored his company’s growth. Ford was never a stranger to politics, working with several presidents. Like many big business leaders, he was originally an opponent of Franklin Delano Roosevelt and his New Deal program. However, like many other big business leaders, Ford’s plants became crucial for producing World War II equipment.

Many of the business titans featured in the book have had varied success regarding their federal interactions. However, few have had as many missteps as Henry Luce, founder of Time Magazine. Another of FDR’s critics, Luce, later tried to cozy up with the Republican Eisenhower administration and was rebuffed.

If Troy had published his book in 2025 and not August 2024, his section on Musk would have been much larger. Some ascribe a certain madness to Musk, but as Troy catalogs, he is crazy like a fox. Musk was initially an ardent supporter of Barack Obama, who favored electric vehicle subsidies, which helped Musk’s EV manufacturer, Tesla. However, as competition among EVs has grown, and his competitors use the same subsidies, the newly MAGA-ized Musk now wants to do away with them. And he is now so enamored of Trump that he is the point man on an initiative to improve efficiency in government to save money. The fact that entitlements and defense spending are off the table, comprising some 75% of government outlays, will task even the ingenuity of even the ever-resourceful Musk.

Troy concludes, “CEOs cultivate presidents because it is good business. Whether it is good for the American people is another question.” The author lists all kinds of ways that executives in banking, healthcare, technology, media, and agriculture steer legislation and presidential policy toward those initiatives beneficial to their businesses. One example is Jamie Dimon, decadeslong CEO of JP Morgan, the bank named for the financial savior of 1907. Instead of a hands-off attitude, Dimon made 16 trips to the White House during the Obama administration before a cooling-off period in 2012. Obama had to beat businessman Mitt Romney, so business leader White House junkets became scarcer. Dimon is now nurturing relations with the incoming Trump administration, even sending notes to Donald himself.

Big Bank CEOs understand that with thousands of lawyers, accountants, and IT personnel, they can meet extensive regulations where a start-up regional bank, a possible disruptor to Dimon’s business, cannot. Troy writes, “The whole tangle of rules and regulations can benefit corporations, which can afford to pay.” The formal term for this is regulatory capture and informally crony capitalism. An AD Tippet Bank of Wisconsin CEO probably does not get love notes from Trump.

Even the concept of a Gilded Age, laissez-faire, wild wild West is also a myth. Back then, business moguls such as Cornelius Vanderbilt and Jay Gould influenced (or outright bribed) local and state government officials. The federal government was not yet big enough to merit that kind of attention. The evolution to centralized authority changed with Teddy Roosevelt and Woodrow Wilson.

With this in mind, Troy ties in a conservative argument for his work: “If a large company wants to survive and thrive, it must have a strategy for dealing with an increasingly powerful and interventionist federal government.” The greater the size of government, the more government becomes an everyday part of Americans' lives, and the more the private sector will find ways to influence and even control the levers of government.

In many regards, the tech industry made the same mistake as Rockefeller in initially rejecting a close relationship with the government. But as political discourse moved in greater amounts to social media, the new Tech moguls have learned their lesson. It is inconceivable and a little naive that a platform such as Facebook, with 2 billion daily users, many discussing politics, would not garner the attention of politicians. The more the Lina Kahns of this world, shortly to be the ex-Chair of the Federal Trade Commission, wish to intervene in the affairs of America’s businesses, the more those businesses will try to influence governmental decisions.

Rockefeller thought he could run the world’s largest company without a massive Washington DC operation. Contrast that with Meta Platforms CEO Mark Zuckerberg. He, like Rockefeller, initially took a hands-off view of Washington in Facebook’s early days, employing one full-time lobbyist. Times have changed. As recently as December 3, Zuckerberg stated that he is “very keen to play an active role” in debates on tech policy in the next Trump administration. Zuckerberg learned from another reformed tech mogul, Bill Gates, who told him of Washington, “Get an office there, now.” A fast learner, Zuckerberg now has 71 full-time lobbyists in Meta’s employ. Rockefeller was 67 when he realized the need to work with the federal government. Zuckerberg, at just 40, already knows how the game is played