CEO Daily is a business newsletter, and with the exception of Tory Newmyer’s regular Saturday note, we have tried not to dwell on the silliness of the early campaign season.
But it is no longer early, it is no longer silly, and it is increasingly clear that this election is very much about business. There’s a good chance the New Hampshire primaries on Tuesday will be won by one candidate who is an avowed socialist and another who is a protectionist and a nativist. Both are running against the establishment, and that certainly includes business – particularly big business, and even more particularly, Wall Street.
Sanders and Trump may not win in the end. The path to the nomination is long, with many more twists and turns ahead. Moreover, if they do prevail, expect Michael Bloomberg to join the fray as an independent, further mixing the pot.
But regardless of the outcome, this year’s early primaries have sent a clear message. Americans aren’t happy with either the political or the economic status quo, and their frustration isn’t going away. Business should beware.
After the financial crisis hit in 2008, I looked at the history of previous financial crises and concluded that the economic ramifications last longer than financial ramifications, and the political ramifications last longer than both. That’s proven true again. Even as the economy reaches full employment, political dissatisfaction is boiling over.
Business will pay a steep price for this unrest. That’s why the decisions of companies like Pfizer to move their domiciles overseas – which may seem a rational response to irrational U.S. tax laws – or companies like Valeant to jack up drug prices – also a rational response to the vagaries of the U.S. health care system – are so damaging. Public trust in business and free markets is on the wane. Businesses that care about the future need to focus on ways to rebuild it.
Subscribe to CEO Daily, Fortune’s daily newsletter on the top business news of the day.
