Trump and Dimon: Is what's good for JPMorgan good for America?
Chase Manhattan's legendary CEO David Rockefeller urged fellow business leaders to take a stand on public issues. Successor Jamie Dimon keeps to more narrow issues affecting JPMorgan.
Back in 2002, halfway between his retirement as the globe-trotting boss of Chase Manhattan Bank and his death in March at age 102, David Rockefeller stopped in Philadelphia to hawk his memoirs and complain about how America's CEOs were no longer taking stands on public issues.
A grandson of Standard Oil monopolist John D. Rockefeller, David said he wished more corporate bosses – some of the most able Americans -- would speak publicly on issues of the day, as he, DuPont CEO Irving Shapiro, and GE's Reginald Jones had in their turbulent times.
He suggested U.S. action against foreign rulers he found oppressive, and was called a "mass murderer." He advocated better ties to Arabs, and was called an "anti-Semite." Rockefeller said he had no regrets for speaking out: "As a loyal citizen, I had an obligation."
Which set a standard for Rockefeller's successor. CEO Jamie Dimon camped with the JPMorgan Chase & Co. board of directors at Wilmington's ornate Hotel du Pont last week (newly sold to Buccini/Pollin Group, with financing from PNC Bank) before the annual shareholders' meeting.
That event was held not at the former DuPont Co. headquarters, where agents of the original J.P. Morgan had financed World War I shipments to Europe, but at the bank's solar-powered Delaware Technology Center. That former drug-company complex is where Dimon's bank has concentrated 2,000 software developers and tech staff from among its 10,000 Delaware employees.
The company bases its credit-card business in the state, and more. Wilmington is almost the only place outside New York where the company has offices for all major units -- trading and investment banking to tech and corporate lending -- noted Thomas Horne, who heads its Delaware operations. Hosting Dimon was a big moment for Horne's team.
The thin, white-haired Dimon, who was alternately puckish and poker-faced, stood to hear an hour-long litany of exhortations from mostly liberal interest groups holding shareholder proxies.
AFL-CIO lawyer Robert McGarrah asked for curbs on bank grants to staff who leave for government jobs; investors sought to split Dimon's job in two; a line of youthful immigration, gender-equity, and environmental activists from the New York area demanded that JPMorgan stop funding companies that "profit from racism"; Jeremy Davis of the National Pork Producers' Council praised JPMorgan's loans to pig farmers; and Sister Nora Nash of the Sisters of St. Francis of Philadelphia asked the company to oppose new limits on shareholder proposals not backed by management.
When Dimon declined a shareholder request to resign from a CEO board advising President Trump, outlets from Fox News to Vanity Fair posted the story. "Trump is the pilot flying our airplane," Dimon said, adding that it's patriotic to give him advice, and that doesn't mean he agrees with the president on policies.
His remarks reprised his detailed narrative in this year's JPMorgan annual report. Dimon defended the rule of law, world trade, immigration, education improvements, and other positions targeted by Trump (and sometimes by Clinton) in last year's campaign.
At first glance, this seemed to position Dimon in the broad mainstream of issues important to voters in the bank's home city of New York, where Dimon was raised, a Democrat, in a family with immigrant roots.
Dimon's story is remarkable. Leaving a top job at Citigroup after questioning his boss's nepotism, Dimon recruited his most effective Citi peers, including Michael Cavanagh, now CFO at Comcast. He combined a string of New York banks, including Rockefeller's Chase Manhattan, and built them into a better bank than Citi.
Dimon, alone among heads of America's top commercial banks, survived the Great Recession and bailouts (though his rivals were richly rewarded for leaving). His bank now collects $8 billion in revenues a month, and keeps $2 billion as after-tax profit.
But what's his public program? In the annual report and at the meeting, Dimon stopped short of directly criticizing Trump's trade and immigration limits. Dimon also called for tax reform, new roads and airports, and other things Trump says he supports. He didn't call for a balanced budget or new funding.
He would not go as far as some Republican leaders in killing the Consumer Financial Protection Bureau or the Dodd-Frank bank reform law. But he said it's time for the government to ease its limits and make it easier for banks to lend faster.
It's a cycle as old as American business, Charles Elson, head of the corporate governance program at the University of Delaware, said with a sigh. Banks blow up; government tightens rules; banks complain; government eases; repeat.
Should we expect more? Rockefeller told me he'd felt a duty as a CEO to identify national problems, but stopped short of suggesting solutions. Not his job.
By that measure, Dimon works in Rockefeller's tradition: tagging big social problems in ringing phrases; but limiting calls for action to business matters.