Ken Griffin, CEO and founder of Citadel Advisors LLC, speaks at an Economic Club of New York event on Thursday, November 21, 2024, in New York, USA.
Yuki Iwamura | Bloomberg | Getty Images
Citadel CEO Ken Griffin is warning of the high tariffs President-elect Donald Trump has vowed to impose, saying the consequences could be crony capitalism.
“I have serious concerns that rising tariffs will slide us toward crony capitalism,” the billionaire investor told the Economic Club of New York on Thursday.
The Citadel founder said domestic companies can enjoy short-term benefits at the hands of competitors. But he said that in the long term, it would cause more damage to U.S. businesses and the economy as companies lose competitiveness and productivity.
Crony capitalism is an economic system characterized by close, mutually beneficial relationships between business leaders and government officials.
“Companies that enjoy the fleeting thrill of their competitors being driven off the battlefield quickly become complacent and soon take for granted their newfound economic advantage and, frankly, their ability to compete and be content on the world stage. The competitiveness of demand has declined.
Trump has made universal tariffs a core principle of his economic campaign, imposing a 20% tariff on all imported products from all countries, with a particularly harsh 60% tariff on Chinese goods.
Just as the world recovers from a pandemic-era surge in inflation, protectionist trade policies could make goods more expensive to produce and raise consumer prices.
“Now you will find the halls of Washington packed with special interests and lobbyists seeking ever-increasing tariffs to deter foreign competition and protect inefficient American businesses that cannot meet the needs and interests of American consumers,” Griffin explain.
At the same event, Griffin also said he was not focused on taking Citadel Securities public in the foreseeable future. Citadel is a market maker founded by Griffin in 2002.
“We are focused on growing the business and investing in our future. We do believe that during this period of very, very rapid growth, there are benefits to going private,” he said.
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