UNDER TRUMP, REGULATION TARGETED
Of course, Donald Trump’s impact on the business landscape — and by extension, the business school landscape — will not be restricted to the health care sector. As John Graham, finance professor at Duke University’s Fuqua School of Business, says, Trump and his GOP-controlled Congress are likely to reduce the top corporate income tax rate from 35% to between 15% and 20%.
“Based on this, here are three predictions,” says Graham, who directs Fuqua’s quarterly survey of chief financial officers and whose research takes him to the front lines of identifying economic trends. “In 2017, U.S. firms will borrow less debt (because the tax incentive to borrow will fall) and repatriate to the U.S. substantial foreign profits that currently are ‘trapped’ overseas (because the tax penalty for repatriating foreign profits will fall). Corporate inversions out of the U.S. will all but disappear (because the tax incentive to invert will shrink considerably or disappear).”
Cornell University’s Johnson Graduate School of Management’s Maureen O’Hara, the Robert W. Purcell professor of finance, predicts a “greater focus on reducing the scale and scope of financial regulation in the markets.” Robert Prentice, business, government and society professor at the University of Texas’ McCombs School of Business, agrees, saying the big question in 2017 is whether Trump will “dismantle rules that protect investors, consumers, workers, and the environment faster than it can blunt existing rights to sue for investor fraud, consumer deception, unsafe working conditions, and the like. My prediction is ‘no,’ making it a great time to be a plaintiff’s lawyer.
“I’ve been watching West Wing reruns,” Prentice adds. “2017 will look nothing like that.”
‘MULTICULTURALISM AND GLOBALIZATION ARE A REALITY’
Prentice’s colleague Julie Irwin, marketing and business, government, and society professor at Johnson, expects 2017 to be year of reckoning in the culture wars, with Trump’s voters coming to terms with some form of economic reality. She foresees “an epic battle against globalization and automation,” ultimately won by supporters of both. “When the strangers and the robots win,” Irwin says, “business faculty will be there to explain why that is actually a good thing.”
Mabel M. Miguel, professor of organizational behavior at Kenan-Flagler and director of the Global Business Center and Global Business Education Initiative, says despite recent nationalistic fervor attached to Trump and the president-elect’s xenophobic rhetoric, the value of global perspectives will not be lessened in the coming year. “While the popularity of the global narrative waxes and wanes, global capabilities will be more important than ever in 2017,” Miguel says. “Businesses seek leaders who are prepared to manage across cultures, whether they are based in the U.S. working with diverse local populations, collaborating virtually with colleagues halfway around the world, or leading global operations and traveling to new markets.
“The next generation of leaders needs to possess more than a solid understanding of global business practices to succeed; they need to be open, flexible, resilient, and introspective, and possess excellent cross-cultural communication skills. Multiculturalism and globalization are a reality and here to stay.”
CAUTION AMONG THE DEANS
A trio of B-school deans is a bit more circumspect on the question of globalization. “2017 will inform us as to how the world perceives global business and what its impact will be moving forward,” says Rohan Williamson, interim dean at Georgetown’s McDonough School of Business. “From Great Britain to the United States to Italy, we are seeing a populist trend — a reaction to this view of globalization. Next year, we will have a better picture of how globalization is affecting the lives of the average person in countries throughout the world through their votes and actions. The resulting focus will be on the interplay between business and policy at a global level.”
“What will happen in the world of business education, the U.S. economy, and the world?” asks Dartmouth Tuck Dean Matthew Slaughter. “2016 brought a number of surprises to the world’s business leaders: from the U.S. presidential election, to Brexit, and beyond. I predict that what we do at the Tuck School will accordingly be ever more important in 2017: preparing tomorrow’s business leaders for the dynamism and innovation with which the world continually surprises us all.”
And at the University of Minnesota’s Carlson School of Management, Dean Sri Zaheer wonders about the impact of the new political landscape on international students. “International students are going to be more confused than ever as to how the U.S. works,” Zaheer says. “At some level all the rhetoric will be about change, but there will be relative stability on the ground and the market for business school graduates will remain strong.”