The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

By Jonathan Guilford

NEW YORK, Feb 28 (Reuters Breakingviews) - U.S. President Donald Trump’s victory promised big things for corporate America and markets alike. An embrace of tax cuts and shredding red tape should have reversed complaints under prior Democratic administrations. Instead, CEOs plunged into uncertainty. Just look at ordinarily staid wireless carrier Verizon Communications VZ.N, in a single day drawing new questions over both a $2.4 billion contract and a $20 billion merger. This chaotic inscrutability will further weaken the Trump bump.

On Wednesday, the Washington Post reported that the Federal Aviation Administration was considering canceling an agreement for Verizon to overhaul communications undergirding the nation’s air traffic control system and hand it to SpaceX, the firm run by Trump adviser Elon Musk. The next day, Musk himself charged that Verizon’s system is “breaking down very rapidly.”

The problem: Verizon doesn’t run anything. It was awarded the contract in 2023 to replace an aging network still operated by contractor L3Harris LHX.N. Musk corrected the point in a social media post. Verizon’s ultimate fate is unclear.

Then there’s the Federal Communications Commission, which regulates Verizon and reviews its deals with other telecom operators. Chairman Brendan Carr, in a letter to Verizon boss Hans Vestberg, raised what he called a “lack of progress” in dismantling internal diversity, equity and inclusion initiatives, a bugbear of the administration. Warning of the “scope” of the FCC’s “authorities,” he told the company to reach out to agency personnel reviewing its pending transactions - like the giant acquisition of fiber operator Frontier Communications.

Left unsaid is whether there is any actual link between merger enforcement and DEI. Certainly, the FCC has been aggressive before - Chairman Tom Wheeler, under President Barack Obama, consistently cracked down on deals.

What is remarkable now is the lack of clarity. Trump and Musk boast of spurring private investment. While Wheeler or former hardline trustbusters might have raised hackles, they followed a predictable philosophy. If even something as small as the FAA contract - relatively meager per year given Verizon’s and SpaceX’s overall size - can suddenly be yanked away, or the terms of merger enforcement become unclear, it could destabilize corporate decision-making.

This won’t help businesses or the economy. Consumers are wobbling, and executives warn that tariffs could tank industry profits. Post-election run-ups in stocks like Musk’s automaker Tesla or in bitcoin are fading along with the broader market. Leaving executives second-guessing themselves may only make things worse.

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CONTEXT NEWS

Federal Communications Commission Chairman Brendan Carr on February 27 sent a letter to Hans Vestberg, CEO of Verizon Communications, in which he cited concern over an "apparent lack of progress" at responding to White House efforts to dismantle diversity, equity and inclusion efforts in the private sector. He asked the telecommunications firm to "reach out to the agency personnel that have been working on Verizon's pending transactions." The FCC is reviewing Verizon's $20 billion proposed acquisition of Frontier Communications.

Separately on February 27, Elon Musk, who has spearheaded the Department of Government Efficiency's efforts to reduce federal spending, charged that a Verizon system at the Federal Aviation Administration is "breaking down very rapidly," after the Washington Post reported that the agency may cancel a $2.4 billion contract for the company to update an air-traffic control communication system and instead hand the work to Musk's SpaceX. Verizon in a statement said that it is working to build a next-generation system but that it is not yet operational. The current system is operated by L3Harris. Musk later clarified this point in a social media post.

(Editing by Rob Cyran and Pranav Kiran)

((For previous columns by the author, Reuters customers can click on GUILFORD/ Jonathan.Guilford@thomsonreuters.com))