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New York
CNN
—
Another day, another enigmatic billionaire showed up at Mar-a-Lago to pump up the Donald Trump brand as the president-elect prepares to return to the White House.
ICYMI: On Monday, Japanese investor Masayoshi Son joined Trump in announcing a $100 billion investment in US projects over the next four years, with the goal of creating 100,000 new jobs in emerging technologies, including the development of artificial intelligence. (What an investment in 2024 it is not AI-related?) The planned investment will come from Son’s SoftBank Group, which, despite its name, is not a bank but rather a broad global technology investment company.
It’s not the first time a president has sought to generate goodwill through deals with companies promising to revive American industry. But, as Trump knows well from his first term in office, these kinds of arrangements are often cumbersome, but the real value is light.
In perhaps the most famous example, Trump and Taiwanese manufacturer Foxconn announced plans in 2017 to build a $10 billion electronics factory in Wisconsin and create 13,000 new jobs. But the company finally abandoned Most of his plans for the facility and the high-tech products he would build. In 2021, Foxconn said it would invest $672 million in the revised deal, which will create fewer than 1,500 jobs.
Foxconn has said it has invested $1 billion in the state, which still has a major manufacturing site for data servers with more than 1,000 employees. But the facility that Trump once touted as the center of America’s manufacturing renaissance has become a hub. a future Microsoft data hub aims to train workers and manufacturers to use AI.
This isn’t SoftBank’s first rodeo either. Before Trump began his first term, the Japanese conglomerate pledged a $50 billion investment with big promises to create 50,000 new jobs. That investment includes: a satellite startup called OneWeb, which at the time was seen as a competitor to Elon Musk’s Starlink.
SoftBank, which did not respond to a request for comment, invested about $75 billion in US companies through the company’s venture capital arm, the Vision Fund, CNN has learned. But SoftBank never clarified how many of those jobs it actually created, and how many were actually due to one the new the investment
A SoftBank spokesperson told CNN that it had already been in talks with the OneWeb startup for “a long time.” (Since OneWeb eventually laid off more than 500 employees He filed for bankruptcy in 2020. It was later bought by a French satellite operator.)
Another example of over-hope: In 2009, with less than a month left in his first term, President Barack Obama told Caterpillar workers that his nearly $800 billion stimulus plan could save some of their jobs, just weeks after the company announced it. he fired almost a fifth of his employees. But Caterpillar’s leadership continued with thousands of layoffs, telling NBC at the time that the stimulus would not move fast enough.
Not all examples of a big-name CEO making a big presentation with a president have failed. In 2017, Intel’s then-CEO Brian Krzanich pledged to spend $7 billion to restart construction of the Arizona semiconductor factory from the Oval Office. The factory opened in October 2020.
But you get the idea. Good intentions are great, and then they often run into economic realities.
Son, who famously bet on Yahoo and Alibaba in the 1990s, is no stranger to these realities, especially in recent years. SoftBank Vision Fund, its venture capital venture launched in 2017, has gained notoriety for backing major failures, including failed co-working space company WeWork. Softbank also blew a billion dollars on Wirecard, the German payments company at the center of an international fraud investigation, shortly before the company went public.
Bottom line: Son’s investment strategy may not always be the right one, but Monday’s announcement was no ordinary investment. ROI comes from making Trump happy. Son is just the latest in a parade of billionaires vying for Trump’s attention and affection. Others, including Amazon founder Jeff Bezos, Meta CEO Mark Zuckerberg and OpenAI chief Sam Altman, have each chosen to throw $1 million into the president-elect’s startup fund.
They’re all looking for more or less the same thing: a spot on Trump’s “nice” list, or at least the chance to stay off the “naughty” list as long as possible.
CNN’s Kayla Tausch contributed to this report.
