Trump, Musk, Ghosn and Other Tragedies: 2018 in Review

(Bloomberg Opinion) -- As the year comes to a close, I always like to take a look back and reflect on what I got right, what I got wrong – and why.

Let’s start with Amazon, shall we? In April, after President Donald Trump began calling on the U.S. Postal Service to jack up the price it charges the company to deliver packages, I wrote a column suggesting that for all his venom toward Amazon, there really isn’t much the president could do to hurt it. (Quick reminder: Trump’s animus is really aimed at chief executive Jeff Bezos because of his ownership of The Washington Post.)

The president’s complaints about Amazon led the administration to order up a study of the postal service’s finances. It was released in early December, concluding – for the umpteenth time – that the post office’s “long-term sustainability is in question.” Among its many recommendations was a call for the postal service to increase the price on package delivery. But such an increase would apply to all its package deliveries, not just Amazon’s.

Wouldn’t you know it, though? Amazon is already one step ahead of the administration. It has begun to put together its own networks of delivery companies to reduce its reliance on the postal service; you may have seen an Amazon truck delivering Christmas packages in your neighborhood. A Cowen and Co. analyst predicted that, thanks to this growing network, the post office’s share of Amazon’s delivery business will drop from 63 percent to 45 percent by 2023.

In other words, Trump’s desire to hurt Amazon will wind up damaging the postal service instead. Surprised?

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Alas, Elon Musk did not take my advice and hire the former Ford chief executive Alan Mulally, as I suggested in an August column. That’s a shame.

Instead, in the wake of his August Twitter fiasco, when he claimed to have “secured” financing to take Tesla private, he agreed to an SEC settlement that included his stepping down as board chairman. He replaced himself with Robyn Denholm, a telecom executive who has been on the board since 2014. More recently, he added Oracle chairman Larry Ellison and Walgreens executive Kathleen Wilson-Thompson as directors.

None of these changes will do much to fix what ails Tesla. First, the new directors know nothing about the car business. More importantly, they are not going to be willing to face the fact that Musk is a terrible manager, and is damaging his company. This was most recently illustrated by journalist Charles Duhigg, in a Wired article whose title says it all: “Dr. Elon and Mr. Musk: Life Inside Tesla’s Production Hell.” Duhigg reports that Musk’s erratic behavior this year has driven away almost every executive who once had the stature to push back against his worst ideas.

Tesla needs Musk to step aside. Taking Tesla as far as it’s gotten is a tremendous achievement, but the company now needs a chief executive with an operations background, preferably in the auto industry, to take over.  Boards, of course, are supposed to make these kinds of tough decisions. But in addition to stocking his board with friends like Larry Ellison, Musk has another card to play: He controls enough of the voting stock that nothing can be done without his say-so. My bet is that 2019 is the year the Tesla dream goes up in smoke.

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I really thought there was going to be more of an uproar in the West,  especially in France, over the arrest and jailing of Carlos Ghosn – and predicted as much in a recent column. He has been confined to a small unheated jail cell in Japan since mid-November, where he continues to be interrogated by Japanese prosecutors and only intermittently visited by his Japanese lawyer. His daughters, who spoke recently to the New York Times, say they have had no contact with him, but have learned from others that he has lost 20 pounds, and has repeatedly asked for more blankets to protect against the cold. On Dec. 20, he was scheduled to be released on bail when prosecutors re-arrested him on a new set of charges.

Ghosn’s daughters also echoed a sentiment that has gotten some traction since his arrest: that he is being framed by Nissan executives who want to be rid of the company’s alliance with Renault. Ghosn, who is the chief executive of Renault and was the chairman of Nissan, had put together the alliance to help save a struggling Nissan in 1999; today, although Nissan is the dominant company, Renault still controls 43 percent of the stock.

The French journalist Philippe Ries – who, as it happens, co-wrote a book with Ghosn – recalled in a recent article in Les Echos that when Ries was held by the Polish authorities in 1978, the French government worked vigorously to free him.

“The apparent passivity of the French diplomatic establishment now, compared to when it mobilized in 1978 to liberate a simple journalist imprisoned in Poland, is troubling,” he wrote.

Indeed it is. The French government holds a 15 percent stake in Renault – a stake that was increased on the insistence of Emmanuel Macron, who was then the country’s economic minister and is now its president. You would think that that alone would be enough to push the French to demand that Ghosn be freed – he is, after all, still Renault’s chief executive.

But even without such a stake, you’d think Macron would want to get one of his country’s leading industrialists – and employers – out of prison. I’m told that he is afraid to do so because the country’s mood is so anti-elite. He fears it will look like a case of elites helping elites.

I still think there will be outcry when Ghosn finally gets out of prison – but France will be blamed for his ordeal as much as the Japanese.

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Early last year, right around Super Bowl time, I wrote a column about the damage that playing football can do to the brain.  I ended the column with this paragraph: “Me? I’m going to watch Sunday’s Super Bowl, as I always do. And then I’m going to look over at my 7-year old son, and think: Never.”

Well, that boy is now 8, and much to my chagrin, he became a complete football fanatic this season. During the week, he tosses a football around with his friends at recess, and on the weekends, he pleads with me to take him to a local sports bar so he can watch his beloved Green Bay Packers. (His mother is from the Midwest.)

Years ago, I got him started on tennis and snowboarding – both sports that he can enjoy for a lifetime, neither of which involves hitting a helmet against an opponent’s helmet play after play after play. He still likes both sports, but it is clear that they now take a backseat to football; Roger Federer can’t hold a candle to Aaron Rodgers these days.

Which means, of course, he wants to play organized football. I’ve been talking up flag football, which is the safe alternative for kids under 12. And for the most part, he’s accepted that answer. But he has cousins who played high school football in the Midwest, so I guess I knew the question was coming.

“Dad,” he said the other day, “can I play football when I get to high school?”

My answer hasn’t changed, but I’m glad I’m not going to have to deal with it until 2024.

For now, happy 2019!

To contact the editor responsible for this story: Philip Gray at philipgray@bloomberg.net

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Joe Nocera is a Bloomberg Opinion columnist covering business. He has written business columns for Esquire, GQ and the New York Times, and is the former editorial director of Fortune. He is co-author of “Indentured: The Inside Story of the Rebellion Against the NCAA.”

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