Wrangling this Gray Rhino Rampage

The current occupant of the White House has unleashed a crash of clear and present dangers. Everyone is a stakeholder. How are different actors responding?

The opening salvos of Donald Trump’s second term in the White House have unleashed a crash of gray rhinos: an interconnected group of obvious, clear and present dangers.

Trump has long been an obvious threat to the US and global economies, to the rule of law, to anyone who is not a privileged white man, to the values of competence and decency, to the dignity of the office he occupies, to national unity, and to the US Constitution.

I hate having to write about politics and do not identify with any political party. Policy is what I care about. But in this case, the policies cannot be fixed without addressing the politics first.

It has been no secret that one of Trump’s first policies would be to impose tariffs – a massive import tax on U.S. citizens to fund intended tax cuts for billionaires. Financial markets immediately responded to that news.

In less than three weeks, Trump 2.0 has escalated from the already-expected trade war; an expensive and inflationary deportation campaign of dubious legality; a reversal of crucial climate policies; and threats against allies… to a full-fledged constitutional crisis.

Allowing an unelected billionaire with a history of erratic and illegal behavior and destruction:

• Access to Americans’ most sensitive tax data

• Setting his minions loose on the software behind payments systems to American citizens as well as government suppliers; service providers; and educational, research. and public services grant recipients

• Trying to close USAID, the development agency that has been a key part of US global smart power and diplomacy

• Threatening payments to American citizens who depend on them.

• Creating an economic ripple effect as Americans –particularly those directly affected by the scorched-earth tactics in Washington-- batten down the hatches.

Let’s skip past the inevitable and tedious “nobody-could-have-seen-this-coming” and
“I-told-you-so” narratives and debate over which is right. The most important conversation goes straight to what to do about the crash of gray rhinos rampaging out of the White House and threatening to do even more damage.

The gray rhino is a reminder that humans are prone to neglect or outright ignore ALL obvious problems –but that not all humans ignore every single gray rhino. The concept is a challenge to be among those who stand up when they see something large and scary headed their way and not to be among those who get trampled.

Gray rhino theory is about RESPONSES to risks. It includes an analytical framework for understanding which stakeholders are in which stages of response. Understanding how various stakeholders are affected and responding helps in strategizing next steps –to motivate more stakeholders to act and to improve the responses already underway

Here’s a quick rundown (by no means exhaustive and in no particular order) of various stakeholders and impacts:

Stakeholders who benefit from chaos: Volatility investors and traders. Cryptocurrency investors (depending on the day; see below). Short sellers. Corporate raiders looking to pick up assets on the cheap. Fearmongers. People with daft ideas that we can all just move to other planets once we destroy this one. Modern-day “robber barons.” Foreign governments, scammers, and various “pay to play” actors.

Stakeholders who benefit from Trump’s proposed tax and tariff policies: Companies who “pay to play” in exchange for special treatment (see: Meta. Amazon….). The wealthiest citizens who expect their taxes to be reduced if Americans do not wake up to the fact that broadly based import taxes –paid by Americans, not foreign countries—will subsidize said tax cuts.

Stakeholders whom his policies hurt:
The majority of businesses –Main Street as well as Big Business—who need some level of certainty to plan ahead. Government contractors. Americans who will pay higher taxes –both through tariffs and expected policies that raise taxes on most Americans while reducing them for the richest. Americans who will pay higher prices for groceries, services, and more. Allied nations. Trade partners. Government agencies whose employees’ lives have been thrown into chaos. Government agencies who used diversity, equity, and inclusion programs to tap into a broader talent pool. Citizens and lawfully present immigrants and guests caught up in a capricious and arbitrary crackdown.

Stakeholders with various types of power to address the problem directly:

• Congress.

• Supreme Court

• Elected officials

• Appointed officials

• Judges

• Party officials

Stakeholders who can pressure stakeholders with various types of power to address the problem:

• Civic organizations

• Businesses -from boards of directors to C-suites to employees

• Markets

• Lawyers

• Individual citizens -including those who voted against Trump, who voted for him, and who didn’t vote at all

• Other nations –both those directly affected by tariffs and other measures, and those indirectly affected

How are stakeholders responding?

This is a very partial list that becomes more and more out of date by the minute. Nevertheless, it gives an idea of some of the responses so far and in the works.

Markets
A single investor rarely has the kind of power that George Soros did when he shorted the pound sterling and forced the UK out of Europe’s Exchange Rate Mechanism in September 1992.

But together, many investors can send BIG messages.

Markets sent an immediate sign of strong disapproval when the White House announced tariffs on Mexico, Canada, and China; then calmed when it announced a temporary pause.

Bond markets have been signaling since Trump’s election that investors expect higher inflation. And analysts have been cautioning that they may not prove to be a save haven if equity markets tank.

Credit agencies
The risk of a sovereign credit default by the United States has risen significantly. What will the credit rating agencies do? As Brian Beutler puts it in this Off Message post: “If ratings agencies were able to detect political instability by watching contentious or irresponsible legislative fights play out, you’d think they’d be able to draw some conclusions based on the fiat transformation of the U.S. system of government from a democratic republic into whatever this is.”

Crypto
Cryptocurrency holders, interestingly, sold off these assets after the tariff announcements –especially Trump’s and Melania’s new meme coins, which were down 75 percent and 90 percent. But the volatility has benefited traders, with the $TRUMP coin generating close to $100 million in trading fees through January 30^th alone.

Elected and Appointed Officials
House Minority Leader Hakeem Jeffries has laid out a response plan. Congressional democrats protested at the USAID building. Judges have pushed back against Trump executive orders on birthright citizenship, funding freezes, and more.

Last fall, we saw some pushback from Republican elected officials against his Attorney General nominee, Matt Gaetz. This year, however, there has been very little public resistance to other nominees of questionable caliber, to his tariff policies, or to his use of executive orders to gut federal agencies and contradict Congressional mandates.

Civic Organizations
A growing list of civic organizations are using the courts to fight back against Trump executive orders including the creation of the Department of Government Efficiency, an agency with no Congressional oversight and an acronyn named after a cryptocurrency alternately promoted and called “a scam” by the agency’s head, Elon Musk.

A medical advocacy group has sued over the removal of health information from multiple government health-related websites (a particularly ill-advised information gap as a new avian flu rages). Alliance for Retired Americans and two labor unions filed a lawsuit against Treasury Dept. to block disclosure of personal and financial information to Musk and DOGE. The American Civil Liberties Union and others have sued to challenge his asylum ban.

Another set of organizations, the 50501 movement and the Bernie Sanders related group Political Revolution, has organized are protests at every state capitol Wednesday, February 5.

Citizens
Americans who object to what is happening are adopting many strategies, from contacting elected officials to attending protests to many other day-to-day strategies.

Federal Employees
Employee unions and attorneys have pushed back against the Trump administration’s policies, including the insistence that they return to office work even when there is not a clear argument for it. Many say they have no intention of accepting buyout offers. Legal challenges are in the works.

Companies
Boards of directors are considering how to respond to the onslaught of new policies and disruptions. Some companies have jettisoned their Diversity, Equity, and Inclusion policies to avoid being targeted. Others have reaffirmed theirs. For their part, consumers are sharing lists of companies on either side of the political divide.

I keep seeing people on social media and sloppy (mostly American) journalists at insignificant publications trying to equate gray rhinos with its cousin, the elephant in the room. Nothing could be more inaccurate. By definition, nobody says or does anything about the elephant in the room, which generally just stands there.

The gray rhino is the big challenge coming at us and challenging everyone who sees it to respond. It’s not about predicting an outcome but rather about preventing unwanted outcomes by redirecting the power of a looming challenge to solve problems.

Let’s use the power of this crash of gray rhinos to prevent the worst-case scenario –and then set to work to keep future similar threats from charging.

More on all of these in coming days and weeks.