President-elect Donald Trump ought to learn from the struggles facing the U.K. in the wake of Brexit when it comes to regulation and trade, Del. Supreme Court Chief Justice Leo Strine Jr. told attendees of The Deal Economy conference on Thursday in New York.
Carelessly tearing up trade treaties like the Trans Pacific Partnership (TPP) and repealing legislation such as the Dodd-Frank Act, the law created in response to the Great Recession, and the Affordable Care Act, the health reform better known as Obamacare, would fuel significant global uncertainty that could ultimately create paralysis in the dealmaking world, Strine warned on a panel discussion moderated by The Deal's Bill McConnell.
Jonathan R. Macey, the Sam Harris Professor of Corporate Law, Corporate Finance and Securities Law at Yale Law School, also participated on the panel: "Beyond the Election: Regulatory Outlook for Corporate America and Wall Street."
Before "precipitous" actions are taken against such legislation along with trade agreements like the TPP, however imperfect they may be, Strine said the new administration ought to learn from Britain's exit from the EU: "Can you listen to the discontent about forms of nationalism that hasn't worked for them?"
The tone the U.S. sets is very important, Strine added on the sidelines of the conference following the panel, explaining that if a market leader acts in a more "protectionist" way, it will invite other market leaders around the world to follow suit. Given that a lot of trade agreements haven't necessarily been sensitive to working class people, that could create a deal environment in which you have the U.S. government examining how a takeover proposal is going to threaten domestic jobs. This added uncertainty could lead dealmakers to freeze up, Strine noted.