In late February, Nike boss John Donahoe led a virtual all-hands meeting where he delivered a message to his staff: The company wasn’t performing at its best and he held himself accountable.

Two weeks earlier, Nike had announced it would lay off more than 1,600 employees .

Now, as the CEO spoke at the meeting, critical comments started to fill the chat window on the Zoom call while more than 20,000 employees watched.

“Accountability: I do not think that word means what you think it means,” an employee wrote. “If this is cost cutting, how about a CEO salary cut?” another wrote. Soon a cascade of laughing emojis filled the screen.

Some colleagues warned others that their posts weren’t anonymous and the chat might be monitored. The attacks went on for several minutes. “I hope Phil is watching and reading this,” an employee wrote, referencing the retired Nike co-founder Phil Knight .

The virtual protest illustrated the depths of the dissatisfaction within the sneaker giant and concern for its strategy. “How did we actually get here?” wrote one product manager.

Since the pandemic, Nike has lost ground in its critical running category while it focused on pumping out old hits and preparing for an e-commerce revolution that never came. The moves, current and former employees say, have eroded a culture of innovation and edginess that made Nike one of the world’s best-known brands.

Donahoe had told The Wall Street Journal in 2020 that his No. 1 priority when taking over the company was “don’t screw it up.” Four years later, the company is unwinding key elements of the CEO’s strategy that have backfired as a growing number of upstarts nip at its heels.

Among the reversals: As Covid raged and more shopping moved online, Nike cut ties with longtime retail partners such as DSW and Urban Outfitters and tried selling more merchandise directly to consumers. It is now asking some of those stores for help clearing out its overstuffed shelves and warehouses.

“I would say we got some things right and some things wrong,” Donahoe said Thursday, in an interview at Nike’s Beaverton, Ore., headquarters.

Losing its roots

The strategic missteps have animated a debate inside the company about its identity. In its zeal to boost digital sales, some current and former employees say, Nike veered from its roots as a maker of cutting-edge footwear for serious athletes. It has opened itself to competition from newcomers such as On and Hoka, which have borrowed from the playbook that fuelled Nike’s rise—including focusing on sport over lifestyle, and taking risks on innovation.

Nike’s once torrid growth has stalled . Sales for the quarter ended Feb. 29 were flat compared with a year earlier, and shares in the company have declined 24% over the past year, compared with a 19% gain in the S&P 500. 

Donahoe in the interview acknowledged the brand lost its “sharp edge” in sports and needed to boost its “disruptive innovation pipeline.” The CEO said the brand’s marketing got fragmented and that with people going back to bricks-and-mortar stores, it was clear Nike needed to invest in its retail partners.

Nike executives said in interviews that the company became too cautious after the pandemic and overly reliant on older products that were reliable sellers. They said the company has made significant changes in recent months to refocus it on putting out cutting-edge footwear.

“We were serving consumers what they know and love,” said John Hoke , Nike’s recently named chief innovation officer. “The job is to of course do that but also to show them something new, take them someplace new.”

Donahoe said Nike is going through a period of adversity and layoffs that has created uncertainty, but that the company will get through it. “Our employees have been through a lot,” he said. “Nike is actually at its best, like a great sports team, when our backs are against the wall.”

Knight, who is chairman emeritus of the board and the company’s largest shareholder, said in a statement that Donahoe has his “unwavering support.”

Donahoe said employees’ responses to the all-hands meeting reflected one of Nike’s biggest strengths: how much its staff cares about the company. “We welcome and encourage that,” Donahoe said.

Shift into digital

Donahoe took over Nike just before the pandemic, at a delicate time. Though he inherited a market leader and one of the world’s best-known brands, Nike was seeking a refresh after it dealt with complaints about its workplace culture that led to a management shake-up .

The Evanston, Ill., native had been CEO of eBay , where he doubled the e-commerce platform’s revenue during a seven-year stint that ended in 2015. After a sabbatical—during which he says he had a life-altering experience at a 10-day Buddhist silent meditation retreat—Donahoe went on to run cloud-computing company ServiceNow .

When he took the helm of Nike in early 2020, his marching orders from Mark Parker , his predecessor and current executive chairman, and Knight were clear. He was to turn the world’s biggest shoe maker into a tech company more directly connected to consumers through its own apps, which in turn collect valuable data from shoppers.

Parker said when he stepped down that Donahoe was the right candidate to lead Nike’s digital transformation.

Donahoe was just the fourth CEO in the company’s more than 50-year history. The only other outsider to get the job said he was ousted in 2006 after a short stint because he focused too much on the numbers .

Donahoe started out with a 100-day global listening tour that was cut short after a month when the pandemic hit.

Covid lockdowns fueled a surge in online shopping. Digital channels accounted for 30% of Nike’s sales in May 2020, about three years ahead of schedule.

Donahoe saw it as an acceleration of an inevitable shift and adjusted Nike’s plans accordingly. A few months in, he redoubled the company’s bet that it could make more money by selling products directly to consumers through its stores and digital channels. He said he believed digital sales would reach 50% of the business, and Nike should transform faster to define the marketplace of the future. It was time to act.

By late 2020, Nike dropped about a third of its sales partners and sold less merchandise to clients such as Foot Locker , DSW and Macy’s . There had been a plan to phase out wholesale clients since 2017, but with digital sales growing quickly, Donahoe said there was a need for urgency.

Executives were divided over whether Nike’s own stores, which include both factory outlets and specialty shops selling higher-priced new releases, could fill the sales void left by the retailers the company was cutting out.

In meetings, finance chief Matt Friend and Nike president Heidi O’Neill supported the aggressive exit from retail that Donahoe was pushing, while others favoured a slower transition, people familiar with the matter said.

Some executives felt the specialty stores in particular worked better as marketing tools and that cutting off so many retailers so fast would backfire, the people said. Donahoe and his allies prevailed.

Nike teams were tasked to come up with a new global supply-chain process. Selling directly to consumers increased the company’s liabilities, including by shifting storage and shipping costs from wholesalers to Nike. The company would also absorb the losses from discounts if the merchandise didn’t sell quickly and inventory piled up.

One of the casualties of Donahoe’s 2020 transformation was a multibillion-dollar operation dedicated to developing footwear sold for under $100. The company deprioritised more-affordable footwear that usually sold to the sales partners that Nike was leaving behind. The move left Nike skewed toward higher-priced shoes.

The first evidence of cracks in Nike’s new approach appeared early last year when Foot Locker Chief Executive Mary Dillon said during an earnings call the brand had reversed course and was sending the retailer a wider assortment of Nike products. By the summer, Macy’s and DSW were saying the same thing.

The message was clear: Nike needed help selling merchandise.

Nike veterans said cutting off wholesale clients was one of the biggest mistakes the company has ever made. After digital sales hit the 30% of the total mark early in the pandemic, they dropped back, and haven’t reached that level since—let alone the 50% target Donahoe had foreseen.

Donahoe said in the interview the goal at the time was to lean more on specific partners, such as Dick’s Sporting Goods and JD Sports , which he considers to be more aligned with Nike, rather than make a dramatic shift in strategy. Nike deprioritised making lower-priced shoes because of supply-chain disruptions during the pandemic, but it is now making more of those products, he said.

“I don’t see it as a reversal of the strategy,” Donahoe said of the return to more retail chains. “I see it as an adjustment.”

Rising competition

Competitors have been using the sneaker giant’s playbook at its expense. Smaller brands like On, Hoka and New Balance have captured significant pieces of the market for both hard-core and everyday runners—and their popularity is spreading to the mainstream.

Often quoting Knight, the Nike co-founder, former employees said the principle always was to first capture the market for hard-core athletes with innovative performance gear, and the casual consumer would follow.

In early February, Hoka owner Deckers Outdoor tapped Nike alums to take over both the parent company and the shoe brand. Hoka had $1.4 billion in sales for the year through March 2023, compared with about $352 million three years earlier.

Hoka didn’t respond to requests for comment.

“When you’re the biggest, there’s always going to be people coming after you,” Donahoe said. Competitors give Nike an incentive to try to understand what consumers want and to figure out how to come up with something bold and different, he said.

Nike still dwarfs its competition . During Donahoe’s tenure, Nike sales have grown 31% to $51 billion in 2023. That is more than double the results of Adidas, its closest competitor by far. New Balance reported sales reached $6.5 billion last year, and upstart On almost hit the $2 billion mark.

The race to hit revenue targets came at a cost for Nike. Executives turned to the brand’s lucrative franchises, including Air Jordan and Dunk, and ramped up the releases. The strategy diluted the exclusivity prized by die-hard Nike sneaker shoppers.

Donahoe said in the interview that Nike ramped up production to meet demand on its SNKRS app, which fans use to buy the latest limited releases. In early 2021, Nike was meeting less than 5% of the demand for some releases on the app and consumers were frustrated, Donahoe said, adding the goal is to meet something closer to 20% of demand for the exclusive styles.

Now, sneaker resellers say they have seen release after release of Nike’s limited-edition kicks that don’t sell out on the SNKRS app, and that in the secondary market—a space that the brand closely monitors —prices are tanking.

Nike executives in March said they would pull back on franchise releases.

Donahoe said “franchise management has always been something Nike has done.”

Nike’s digital sales, a figure that includes direct and partner e-commerce sales, declined for the quarter ended Feb. 29. Friend, the finance chief, told analysts in March that Nike expects total sales to decline at least until the end of this year.

Struggle for innovation

The pursuit of sales growth from limited-edition sneaker releases led Nike to neglect its running category, long considered the core product of the company, former employees said.

This month in Paris, Nike unveiled its new product line for the Olympics, including running shoes with a new cushioning system that uses the company’s Air technology.

In interviews at the event, executives said the company had become somewhat risk-averse during the pandemic, when working remotely stifled creativity. Martin Lotti, chief design officer, said the company had spent too much time looking to its past.

 

“If you drive a car just by looking in the rear view mirror, that’s not a good thing,” Lotti said. “The bigger opportunity is the windshield.”

Current and former Nike executives believe the future of the company is in its app ecosystem , like the Nike Training and Running Club or its SNKRS app, and the data it can harness from them to help design and sell products. Inside the company, leaders have long tried to draw comparisons to Apple when talking about Nike’s innovation and design culture.

The sneaker giant has been acquiring smaller data analytics startups for at least a decade. Two years ago, it also bet on the NFT craze .

One of Nike’s biggest tech investments is a multibillion-dollar process to migrate multiple software programs into one single system. The new platform, known as S/4HANA, is still not operational and is three years behind schedule. The software is designed to help day-to-day operations, such as procurement and inventory management, and speed up digital sales.

As part of its accelerated focus on digital sales, Nike hired about 3,500 people to join what the company calls its global technology group, which includes consumer insights and data analytics. Executives at the time said they were investing in “demand sensing,” “insight gathering” and a new inventory system.

Former Nike employees with knowledge of the consumer insights strategy said executives misinterpreted the data in ways that overestimated demand for retro franchises.

During February’s round of layoffs executives trimmed layers of management across the company’s insights and analytics teams. A large technology innovation team, tasked with developing software to implement Apple’s new Vision Pro augmented reality system in day-to-day design tasks, and a separate artificial intelligence team were also eliminated.

Executives at Nike say it is entering a “supercycle” of innovation and that the new Air line of products enhances athlete performance.

At the Olympics preview event this month, the company took over the historic Palais Brongniart in central Paris with a three-day event to unveil its new Air line. Guests wandered through a museum-like, conveyor-belt installation highlighting Nike’s product evolutions and research and development programs. Athletes including runners Sha’Carri Richardson and Eliud Kipchoge modeled the new gear. Retired tennis great Serena Williams narrated the company’s lavish introduction video before appearing on stage.

Outside, 30-foot orange statues of Nike-sponsored athletes including LeBron James, Kylian Mbappé and Victor Wembanyama stood guard.

Donahoe’s relationship with Knight goes back to the early 1990s, when he was a Bain consultant on Nike projects. He joined the Nike board in 2014 and is one of the directors of an entity Knight created called Swoosh LLC, which holds roughly $22 billion worth of Nike shares and controls a majority of Nike’s board seats. Donahoe calls Knight his “greatest hero in business.”

The current CEO said he meets with his predecessor, Parker, every week.

Donahoe said that he and Parker share an approach to management he calls “servant leadership” that was embodied by some of his sports heroes, including basketball coaches Phil Jackson, John Thompson, Mike Krzyzewski and Tara VanDerveer.

“It’s never been about me. It’s about your players. And are you doing everything you can to allow your players to make the adjustments to win? And when you have a win it’s about the players and when you have a loss you say it’s on me, right?,” he said. “And that’s what I’ve always tried to embody, including during this period of time.”

This week, Donahoe is facing another test: the company is notifying several hundred more workers whose jobs are being cut.

The crowd at the St. Regis hotel in Aspen, Colo., on one weekend last fall was handpicked, and if you had to ask to be invited, you wouldn’t be on the list. Guests, including Ron Howard, Karlie Kloss and Goldman Sachs Chief Executive David Solomon , were given Barbour vests, offered a walk-and-talk with Olympic running champion Allyson Felix, take a golf clinic with professional golfer Michael Block or bike with Gen. David Petraeus. The bike route climbs more than 2,000 feet starting from an 8,500-foot elevation.

One morning, a man in his 50s in a dark sweater was speaking to a group, while his security staff stood off to one side, an attendee recalled. He was Elon Musk , talking with the author of his newly released biography, Walter Isaacson , in an off-the-record conversation moderated by CBS anchor Gayle King. It was one of the hottest tickets on a packed agenda at the ultra exclusive and secretive conference known as the Weekend, co-hosted by Endeavor CEO Ari Emanuel and other business, tech and finance leaders.

Musk and others attending the Weekend, and gatherings like it, get to exist for a brief time in a buffered safe space where CEOs, celebrities, athletes and political leaders know that no one will tweet a photo of them working out or waiting in line for Champagne. They are invitation-only, and attendees often arrive via private jet and tinted-out SUVs. The talks are off the record. No one who goes cares what it costs.

“There aren’t that many places for these people to have these conversations,” said Salesforce CEO Marc Benioff , who hosts his own intimately curated gatherings of business leaders and has attended other people’s as well. (In the parlour game of invitations, his dinners can feel like a rung up from anything called a conference.)

It has been 40-plus years since Allen & Co. put on its first so-called summer camp for the billionaire set in Sun Valley, Idaho, now an executive’s rite of passage, and more and smaller and intimate ultra-VIP conferences are exploding on the scene—from media mogul and venture investor Jeffrey Katzenberg ’s in Montecito, Calif., to restaurateur Danny Meyer’s in Tuscany. There are new ones popping up nearly every month.

Helping fuel the desire for invitations is the lore of what Sun Valley has spawned: Sam Altman   connected with his most important investor, Microsoft CEO Satya Nadella , at Allen & Co.’s annual July conference; Disney finance chief Christine McCarthy and CEO Bob Iger got some facetime over lunch at the same event a different year, a few months before Disney’s board ousted CEO Bob Chapek and reinstated Iger; Jeff Bezos ’ purchase of the Washington Post stems back to Sun Valley moments.

The newer events make the World Economic Forum’s Davos—with its pop-up media spaces and Getty photographers scattered about—look like a Vegas trade expo. There is a summer excursion to Stockholm for the humbly named Brilliant Minds gathering hosted by Spotify CEO Daniel Ek ’s foundation, which some attendees consider the most fun in the elite event lineup.

The Weekend in Aspen is in September, pre-ski season, but invitees to boutique bank LionTree’s conference called MediaSlopes head to Deer Valley, in Park City, Utah, in March and skiing is abundant in Davos in January. Google’s annual VIP camp has been held in Sicily at a resort with four outdoor thalassotherapy pools. The Brilliant Minds gathering included a cruise around Stockholm’s archipelago, and MediaSlopes offered high-intensity exercise classes taught by the CEO of video game company Take-Two, Strauss Zelnick , who prides himself on his physique. There is usually a concert—the Killers and John Mayer have played MediaSlopes (anyone who goes just calls it Slopes).

This account is based on interviews with people who attended the gatherings, event materials and social-media posts.

Benioff, who also owns Time, has attended the Weekend and Allen & Co.’s Sun Valley event, but says he “can’t do them all” and loves to host his own, even more exclusive events.

At Benioff’s gatherings, there is usually “a small group of somewhere between 25 and 35 people around a table,” he said, adding that he’s hired people he has met at such events. At a recent one, restaurateur Eric Ripert of Le Bernardin prepared the food and briefly spoke with attendees. Comedian Jerry Seinfeld performed and so has Japanese rock star and fashion designer Yoshiki. The gatherings have taken place in New York, Japan, Australia, France and the U.K .

Always a celebrity chef, he said. “We actually end up with a regular set of celebrities and entertainment who are our favourites, and there’s just people we feel very connected to,” Benioff said. “There’s the right level of quality.”

Who’s invited, and where?

At last year’s Slopes, which attendees call the cool Sun Valley, Margot Robbie swapped her Barbie pink for black to be jointly interviewed with Mattel CEO Ynon Kreiz by LionTree Chairman and CEO Aryeh Bourkoff. Bourkoff has been one of the most prolific dealmakers in media, including as a lead banker in AT&T ’s 2022 $43 billion spinoff of Warner Media to Discovery. This year, Lionel Richie performed.

The competitive juices flow, too. Univision CEO Wade Davis has won annual slalom races. And there is a game-show style quiz focused on trends in tech, telecom and media. This year included the question: Who is the biggest streamer? (Answer: YouTube)

The Verdura resort, with “230 hectares of sun-kissed Mediterranean coastline” in southern Sicily, has been home base for what’s known as Google camp in recent years—the tech giant’s annual, invite-only retreat.

Google camp’s theme for 2024, according to a bare-bones website, is artificial intelligence’s role in scientific breakthroughs and addressing global challenges. The site doesn’t say if this summer’s camp will also be in Sicily.

Alicia Keys performed one year on a stage set against ancient ruins. YouTube star Lilly Singh snapped a photo amid the ruins with actress Charlize Theron. “We’re going to change the world. @charlizeafrica   #GenEndIt   #GirlLove ,” @Lilly posted on Instagram. Google owns YouTube.

Google said the majority of guests are customers and partners of Google and discussion sessions make up most of camp. It wouldn’t confirm names.

Jolie Hunt , who advises CEOs among others as founder of marketing and communications firm Hunt & Gather, said she increasingly fields calls from executives and powerful people about which VIP conferences are worth their time, alongside how to get a Birkin bag and book the best driver for Davos.

Part of building the allure of the events is the selective invite lists, with nobody there to pitch their agenda out of turn, some attendees said. Organisers manage the guest list, looking for buzz and mix, and asking for an invite isn’t a good look.

Midnight sun in Sweden

If Sicily didn’t make the calendar, summer’s lineup also includes Stockholm’s Brilliant Minds gathering—the brainchild of Spotify CEO Ek and Swedish entrepreneur Ash Pournouri, who hosted the first one in 2015 before establishing a foundation by the same name three years later.

Actor Jared Leto, Reddit co-founder and startup investor Alexis Ohanian and VaynerMedia CEO Gary Vaynerchuk were among 2022 attendees who boarded a boat for a tour around Stockholm’s archipelago that included a stop on one of the islands for dinner. Their cocktails were garnished with slices of fresh watermelon, and they took in a private concert by Florence & the Machine.

The intention is to bring together creative and influential figures with a goal of creating an impact, a representative for the organisation said. Brilliant Minds’ theme this year is “Discovery,” and so far, Harvard Business School’s Debora Spar , self-help personality Jay Shetty and Stockholm School of Economics Wellbeing, Welfare and Happiness professor Micael Dahlen are expected to present. Past attendees include former President Obama, filmmaker Darren Aronofsky, Snap’s Evan Spiegel , NBA All-Star Draymond Green and Malala Yousafzai.

Anu Duggal, founding partner of the Female Founders Fund who has attended Brilliant Minds and interviewed Trevor Noah and Yousafzai there, said the formal programming runs from 1 p.m. to 5 p.m., adding that the gathering emphasises bringing people together through fun experiences. “They take advantage of the natural beauty of Sweden,” noting the late sunsets at that time of year. Her firm invested in a startup that took part in a pitch competition where she served as a judge.

Stagecraft opportunities

Sometimes attending Allen & Co.’s Sun Valley conference is about making a very public statement from a very secluded place. Bill Gates used the gathering in 2021 as a soft launch for his return to public after the announcement of his divorce from longtime wife Melinda French Gates . Gates was spotted walking and chatting with Evan Greenberg , CEO of insurance giant Chubb . Gates wore khakis and a navy sweater, and both business leaders had white name tags.

In the summer of 2021, as reports emerged of a deteriorating partnership between Facebook ’s CEO Mark Zuckerberg and then-Chief Operating Officer Sheryl Sandberg , the two appeared in photos strolling together along the lush grounds. Sandberg, in a T-shirt with the words “just love” scrawled in cursive, smiled as Zuckerberg, in a navy hoodie, looked at her, also smiling.

Marc Ganis, founder and president of the sports-industry consulting firm Sportscorp, said he has been attending more invite-only retreats or gatherings than ever before, estimating he attends three or four a year in addition to industry-specific events.

“This is where the ideas for business can be developed,” said Ganis. “What makes one better than the other is who actually attends.”

A relative newcomer is an invite-only conference for sports executives put on by Bruin Capital and Penske Media’s Sportico held on Kiawah Island in South Carolina. Bruin CEO George Pyne and Penske Media CEO Jay Penske bring together about 150 attendees including billionaires, commissioners, team owners and investors to play golf and talk about more than sports. Former New Jersey Gov. Chris Christie and the former prime ministers of New Zealand and Finland, Jacinda Ardern and Sanna Marin , spoke this year—the event’s third year—as did former Pimco CEO Mohamed El-Erian .

The world’s biggest advertising agency, WPP, calls Stream, its invite-only event for about 300 invitees, an “unconference.” Attendees, this year in Santa Barbara, Calif., determine discussion topics, which have included “Should we teach robots how to lie?” Its website describes “two days of off-record debate alongside dancing robots; slam poetry; drone races; a space launch” and more.

WPP CEO Mark Read says the event is unique for its lack of PowerPoint slides and that the idea is to foster chance meetings among people in the business. In 2023, Linda Yaccarino spoke after Musk at Stream—a few days before she resigned from NBCUniversal and Musk announced her as X’s new CEO. Also last year, Paris Hilton ran a breakout group, said Read. “We had one famous music executive who turned up and couldn’t deal with the lack of structure and left,” he said.

The surge in exclusive events comes as the World Economic Forum’s conference, held in January in Davos, Switzerland, has ballooned over the past several years. In 2024, more than 800 CEOs and chairs attended Davos, in addition to government leaders and others, according to a WEF spokesperson.

Musk has knocked Davos, tweeting in December 2022 : “My reason for declining the Davos invitation was not because I thought they were engaged in diabolical scheming, but because it sounded boring af lol.” Organisers for the World Economic Forum later said Musk was not among the invited.

But at the Weekend in 2022 Musk got personal. During a conversation with Carlyle Co-Chairman David Rubenstein as Musk’s acquisition of Twitter was pending, Musk said he lost 25 pounds, attendees recounted. He said—in a self-deprecating way—that topless photos of him on a yacht from the summer that circulated around the internet motivated him to lose weight, which he said he did through intermittent fasting.

“It’s craziest when you’re around people like this—there’s always another Champagne room, always another VIP level,” one attendee said, and quipped: “Even the CEO of Goldman Sachs isn’t treated like a VIP. That’s a third-tier guest.”

Taylor Swift was celebrating the end of the Australian leg of her Eras Tour in late February when a bit of unpleasantness sailed out from Down Under and landed on the home page of TMZ. The New South Wales Police Force was investigating a 71-year-old man for allegedly assaulting a 51-year-old man at a wharf north of the city, according to their media unit. Per TMZ, the septuagenarian was Scott Swift, Taylor’s father and a key member of her management team, and the younger man was a photographer.

The story had all the makings of a public relations nightmare: (1) Celebrity family member allegedly behaves badly while (2) disembarking from a luxury yacht, resulting in (3) a police investigation. To make matters more complicated, Taylor was reportedly present for the alleged altercation—hiding under an umbrella, TMZ said. Though the man didn’t require medical treatment, the police said, there was video footage. Would this be the end of the pop star’s marathon run of fawning press?

Not if Tree Paine could help it.

Swift’s longtime publicist first released a statement that did not refute TMZ’s story, exactly, but offered some exculpatory evidence: “Two individuals were aggressively pushing their way towards Taylor, grabbing at her security personnel, and threatening to throw a female staff member into the water.” Subtext: Scott Swift was simply protecting his daughter and another defenceless woman from a couple of rogue aggressors. He was not charged.

Around the same time, as if by magic, People found a video of Scott passing out sandwiches to young female fans at one of the Sydney shows and published it along with fan commentary. “Isn’t he the sweetest and cutest,” one cooed.

Online, Swifties clocked the People story as good old-fashioned damage control. As a chorus of fan posts put it: “The devil works hard, but Tree Paine works harder.” (In late March, the New South Wales Police Force media unit said that the North Shore Police Area Command finished its investigation and that it is taking no further action.)

The average celebrity publicist does not have fans. But Paine, the 52-year-old redhead seen trailing Swift at awards shows and rubbing shoulders with Gayle King in the Eras Tour VIP area, has become a Swiftverse cult figure in her own right. Fans post reverently about her PR machinations and share videos of her expertly attending to Swift’s needs: smoothing out Swift’s dress on the red carpet, leading Swift right past a scrum of reporters whose questions have not been approved, subtly offering Swift what appeared to be water at the Video Music Awards—a night when the star was filmed dancing in a manner that suggested inebriation.

Swift has trained her followers to look for meaning in her every gesture, outfit and Instagram caption. Paine’s own work—the stories she chooses to respond to, the narrative she puts forward in the media—has become part of that lore.

And Swift and Paine are creating a lot of lore lately. Swift spent the fall cheering on her new boyfriend, Kansas City Chiefs tight end Travis Kelce , as he sailed to Super Bowl victory , and dropped by the Grammys to pick up album of the year for Midnights and announce her new album in an acceptance speech for yet another award . The Tortured Poets Department , which fans speculate is at least partly inspired by her breakup with the British actor Joe Alwyn , drops this month, and Swift will promote it while balancing her public relationship, continuing her sold-out international Eras Tour amid growing criticism of her private jet usage and brushing off baseless conspiracy theories that she is secretly working as a Democratic operative to swing the 2024 election for President Joe Biden.

In a long career of riding high, Swift has hit the stratosphere. It’s Paine’s job to keep her there.

Back in 2014, Swift’s world domination was not yet assured. That March, trade publications reported that the pop star’s publicist of seven years, Paula Erickson, had submitted her resignation. Fairly or not, during Erickson’s tenure, Swift developed a reputation for being both boy-crazy and unwilling to joke about it. See: Swift’s string of high-profile relationships with Joe Jonas, Taylor Lautner , Jake Gyllenhaal and Harry Styles ; her alleged wedding-crashing with Conor Kennedy; her humourless response to Tina Fey and Amy Poehler’s joke at the 2013 Golden Globes about her dating life. (“There’s a special place in hell for women who don’t help other women,” she told Vanity Fair when asked about the incident.) Erickson declined to comment for this story.

Paine, who had been working as the senior vice president of publicity in the Christian and Country divisions of Warner Music Nashville, came on board and quickly flipped the script. She launched her own firm, Premium PR, and signed Swift as her first and only client. “There isn’t a publicist in NY, LA or Nashville that wouldn’t jump at an opportunity to work with someone as talented as Taylor Swift and her management team,” Paine told Page Six at the time.

That year, Swift moved from Nashville to New York, went full pop with the release of 1989 and began flaunting her friendships with a gaggle of famous women, known colloquially as The Squad. The public started to forget about the time Swift, age 22, allegedly bought a house across the street from the Kennedy compound in Hyannis Port, Massachusetts.

Throughout this transformation, Paine refused to let rumours about her client fester. The very week her hiring was announced, she began issuing public rebuttals to the tabloids. “Never believe the National Enquirer,” she tweeted about an apparently false story that Swift declined to record a duet with Randy Travis. Ten years later, the gossip about Swift has changed, but Paine’s approach has not: She recently called out the anonymous gossip account Deuxmoi for causing “pain and trauma” by posting false rumours about Swift secretly marrying Alwyn before the two broke up.

Paine became even more visible to fans in 2020, when she appeared in Swift’s Netflix documentary Miss Americana . Wearing white shorts and blue nail polish, she clinked white-wine glasses with Swift as the singer-songwriter anxiously prepared to post her first political statement on Instagram. Swifties have since turned Paine into something of a meme: Online, they joke that Swift’s “Out of the Woods” lyric “the monsters turned out to be just trees” is a reference to the publicist and that a redheaded Eras Tour backup dancer is Tree-coded. They have decided that in the inevitable Paine biopic, the publicist will be played by Amy Adams, and that she will win her first Oscar for it.

The fan obsession has been fuelled, in part, by how little Paine has shared publicly about herself. Her Instagram is private. The last time she sat for an interview was 2012, when she was a VP at Warner and appeared in Nashville Lifestyles ’ “Most Beautiful People” issue; she posed for a photo in front of a shiplap-covered wall wearing a peasant blouse and made the astonishing revelation that she was “trying to enjoy life.” I cannot report whether that is still true; Paine declined to be interviewed for this story.

Born Trina Snyder, Paine grew up in Costa Mesa, California. She was still going by Trina when she was initiated into Pi Beta Phi at the University of Southern California in 1990, according to the women’s fraternity’s official publication, The Arrow .

Like her client, Paine is a Nashville transplant. In her early career, she worked her way up at a variety of L.A. record labels—World Domination, Maverick and Interscope, whose roster included Snoop Dogg, No Doubt, Nine Inch Nails and Marilyn Manson. She launched her own guerrilla-marketing company, worked for the Academy of Country Music and eventually joined Warner Music in Tennessee.

In 1998, she married Lance Paine, a businessman and onetime president of the Nashville candy brand Goo Goo Cluster, in Las Vegas, according to public records. (Lance also served as president of the company owned by HGTV’s Property Brothers.) The Paines have one teenage daughter, and according to the society pages, they have spent some nights mixing with locals at Nashville charity galas.

But mostly, Paine works. She has built a fearsome reputation in media circles, closely guarding access to Swift and sending emails to journalists with surprising velocity whenever she disagrees with a story. “Once I started working in media, I would always hear about people getting emails from Tree Paine, or maybe, people being afraid of getting emails from Tree Paine,” says Hunter Harris, a self-described “Painiac” and the writer of the entertainment newsletter Hung Up , which regularly chronicles Paine’s engagement with the press. (Harris has also contributed to WSJ. Magazine .)

In the past 10 years, Paine has guided Swift through some of the more tumultuous moments of her career: her feud with Kim Kardashian and Kanye West; her trial accusing a former DJ of sexual assault; her battle against her former label , Scooter Braun and private-equity giants for the control of her master recordings. At almost every turn, Paine presents Swift—arguably the most famous woman on the planet, a billionaire with a private jet—as a relatable underdog fighting for her voice to be heard.

It has, for the most part, worked. In the process, Paine has become one of the most powerful people in the entertainment industry.

Getting any kind of journalistic access to Swift has become a fool’s errand. The star sits for few magazine interviews, and in between, Paine does her best to ensure that no information about Swift that Swift has not expressly chosen to share with the public becomes available. One magazine writer recalls the slightly fraught process of interviewing another artist on one of Swift’s stadium tours a few years ago. As a condition of the interview, the writer had to agree that anything they witnessed or discovered about Swift while spending time with the other artist before a show would be off the record. Paine was clear: No journalist is going to catch Swift in her sweatpants backstage and write about it.

When writer Emily Kirkpatrick reached out last year to seek Swift’s comment for a profile of the actress and musician Suki Waterhouse for the fashion website Ssense, Paine surprisingly acquiesced, with the caveat that Swift’s quote be printed in full—no edits, no line breaks. (Kirkpatrick, annoyed, accepted the terms.)

This is an understandable sticking point for Paine. The Kardashian-West debacle revolved, in large part, around a truncated recording of Swift. Before the rapper released the single “Famous,” which contained lewd lyrics about Swift, they spoke by phone, where he asked her to promote the track on Twitter. For years, a snippet of the call released by Kardashian painted Swift as a liar who publicly rejected the lyrics but privately approved them. When someone released the full call online—a friendly heads-up but one in which West never shares the final lyric (“I made that bitch famous”)—Kardashian tried to save face. “To be clear, the only issue I ever had around the situation was that Taylor lied through her publicist who stated that ‘Kanye never called to ask for permission…,’ ” she tweeted. But Paine never said that exactly. She tweeted a rejoinder: “I’m Taylor’s publicist and this is my UNEDITED original statement. Btw, when you take parts out, that’s editing. P.S. who did you guys piss off to leak that video?”

The biggest year of Swift’s career has also been her most public yet. There’s the tour, the new album, the NFL boyfriend , the constant tabloid coverage of her relationship with the NFL boyfriend, the never-ending paparazzi strolls with her famous friends at sceney New York City restaurants. There have been stumbles: Swift forgot to thank Celine Dion, who presented the album of the year award, when accepting her Grammy. (A photo of the two singers hugging circulated online later.) She’s still taking heat for her private jet. She dated Matty Healy.

But the sheer volume of information about Swift that pours, ceaselessly, out of every tabloid and news outlet from the Daily Mail to the New York Times typically washes away negative stories as soon as they are published. There are fans who speculate that Paine sent Swift to Kelce’s regular-season game against the New York Jets in October so that internet searches for “Taylor Swift jets” would return cheery images of Swift dancing in a VIP suite with Blake Lively instead of stats about CO2 emissions.

Swift is at a point in her career, however, where she could completely disappear from view and still generate more headlines than just about any other person on earth. Scientists at Caltech and UCLA recently published research proving the existence of “Swift quakes” (seismic activity caused by fans dancing and jumping at concerts). Ancestry.com shared on social media that Swift is a sixth cousin, three times removed, of poet Emily Dickinson. The New York Post talked to experts to guesstimate how much Kelce has spent wooing Swift so far (more than $8 million, allegedly).

If Swift released The Tortured Poets Department with zero fanfare, it would probably still hit No. 1 on the Billboard charts. But she chooses to feed the beast—with black-and-white Instagram posts, snippets of possible lyrics, a pop-up poetry library, so many vinyl editions —and, with Paine’s help, make her own news.

The U.S. and Chinese governments should take action to lower future borrowing, as a surge in their debts threatens to have “profound” effects on the global economy and the interest rates paid by other countries, the International Monetary Fund said Wednesday.

In its twice-yearly report on government borrowing, the Fund said many rich countries have adopted measures that will lead to a reduction in their debts relative to the size of their economies, although not to the levels seen before the Covid-19 pandemic.

However, that is not true of the U.S. and China, which will continue to see a surge in borrowing if current policies remain in place. The Fund projected that U.S. government debt relative to economic output will rise by 70% by 2053, while Chinese debt will more than double by the same year.

The Fund said both countries will lead a rise in global government debt to 98.8% of economic output in 2029 from 93.2% in 2023. The U.K. and Italy are among the other big contributors to that increase.

“The increase will be led by some large economies, for example, China, Italy, the United Kingdom, and the United States, which critically need to take policy action to address fundamental imbalances between spending and revenues,” the IMF said.

The IMF expects U.S. government debt to be 133.9% of annual gross domestic product in 2029, up from 122.1% in 2023. And it expects China’s debt to rise to 110.1% of GDP by the same year from 83.6%.

The Fund said there had been “large fiscal slippages” in the U.S. during 2023, with government spending exceeding revenues by 8.8% of GDP, up from 4.1% in the previous year. It expects the budget deficit to exceed 6% over the medium term.

That level of borrowing is slowing progress toward reducing inflation, the Fund said, and may also increase the interest rates paid by other governments.

“Loose US fiscal policy could make the last mile of disinflation harder to achieve while exacerbating the debt burden,” the Fund said. “Further, global interest rate spillovers could contribute to tighter financial conditions, increasing risks elsewhere.”

A series of weak auctions for U.S. Treasurys are stoking investors’ concerns that markets will struggle to absorb an incoming rush of government debt. The government is poised to sell another $386 billion or so of bonds in May—an onslaught that Wall Street expects to continue no matter who wins November’s presidential election.

While analysts don’t expect those sales to fail, a sharp rise in U.S. bond yields would likely have consequences for borrowers around the world. The IMF estimated that a rise of one percentage point in U.S. yields leads to a matching rise for developing economies and an increase of 90 basis points in other rich countries.

“Long-term government bond yields in the United States remain elevated and sensitive to inflation developments and monetary policy decisions,” the Fund said. “This could lead to volatile financing conditions in other economies.”

China’s budget deficit fell to 7.1% of GDP in 2023 from 7.5% the previous year, but the IMF projects a steady pickup from this year to 7.9% in 2029. It warned that a slowdown in the world’s second largest economy “exacerbated by unintended fiscal tightening” would likely weaken growth elsewhere, and reduce aid flows that have become a significant source of funding for governments in Africa and Latin America.

An unusually large number of elections is likely to push government borrowing higher this year, the Fund said. It estimates that 88 economies or economic areas are set for significant votes, and that budget deficits tend to be 0.3% of GDP higher in election years than in other years.

“What makes this year different is not only the confluence of elections, but the fact that they will happen amid higher demand for public spending,” the Fund said. “The bias toward higher spending is shared across the political spectrum, indicating substantial challenges in gathering support for consolidation in the years ahead, and particularly in a key election year like 2024.”

FOSHAN, China—Qin Huangsheng once imagined a better life in the city when she left her home village to become a factory worker at age 16.

Now, in her early 40s, she has $40,000 in personal debt and a base salary of $400 a month. Debt collectors are hounding her. She is blocked from buying tickets on China’s high-speed rail, just one of the penalties the government is increasingly imposing on people who don’t pay their bills.

On the aging slow trains she is left to ride, Qin sometimes looks at the other passengers and thinks: “I wonder if they’re all bad debtors like me.”

People across China are being weighed down by their debts and a system that penalises them for not paying the money back. Beijing is cracking down on delinquent debtors by seizing their salaries or restricting them from getting government jobs, as well as curbing their access to high-speed trains and air travel. Many are forbidden from buying expensive insurance policies and told they aren’t allowed to go on vacation or stay in nice hotels. Authorities can detain them if they don’t comply.

The number of people on a publicly available government delinquency blacklist has jumped by nearly 50% since late 2019 to 8.3 million today. Courts can put people on the blacklist when they don’t fulfill judgments against them to pay money back or are deemed to be not cooperating with legal proceedings.

Unlike in the U.S., China doesn’t allow most people—including those who had a run of bad luck—to declare bankruptcy to write off bad debts and move on with their lives, a policy some Chinese scholars are criticising as unfair.

Household debt has surged by 50% in the past five years to around $11 trillion today. While that is lower than the $17.5 trillion Americans owe, it is a huge sum in a country where people earn far less.

With home prices falling, deflation risks becoming entrenched and unemployment a persistent challenge , Chinese leaders are eager to get people spending more. But each additional dollar going to pay for debt is taking away one that could be used to splurge on new clothes or pay for a vacation. The threat of punishment for falling behind on debt is making many families more conservative with their money.

Retail sales of consumer goods in China rose 4.7% year-over-year in the first quarter, the government said Tuesday, lagging behind total economic growth of 5.3%. As many in China curtail spending, the government is giving priority to turbocharging manufacturing and exports, a strategy that is exacerbating trade tensions with the West.

With so many Chinese consumers under financial pressure, Western companies including Apple , Estée Lauder and General Motors have reported weaker sales in China .

Chinese officials didn’t respond to questions about the blacklisting system. The government has said previously it only seeks to target those who have the ability to repay their debts but refuse to do so.

Behind China’s personal-debt surge

China’s long housing boom was a significant cause of the rise in personal debts, because many people had to borrow more to afford homes. Some buyers took on extra debt to buy more properties for investment purposes, sometimes letting them sit empty. Now that the boom is over and prices are falling , many are stuck with debts they can’t handle.

The number of foreclosed homes listed for sale rose 43% in 2023 to roughly 400,000 properties, according to real-estate research firm China Index Academy.

The increase in personal debts is also partly a result of more people using credit cards or tapping personal credit lines to handle expenses as the economy stagnates.

Many economists say a U.S.-style financial crisis is unlikely in China soon. State control of the banking system means the government can absorb losses and inject capital in an emergency. Household debts have also largely plateaued over the past two years, as many people give priority to using extra cash to pay down liabilities rather than shopping or investing in stocks.

Still, the prevalence of large personal debts is a problem for China’s leadership.

“Household debt booms tend to lead to bad macroeconomic outcomes, even in the absence of a financial crisis,” said Amir Sufi, a University of Chicago economist. China has no simple fix. “Once the cycle starts, it’s usually one in which it’s painful, long and difficult to predict when it will end,” Sufi said.

A tough system for borrowers

China has tried for years to lift personal spending to ease its economy’s traditional reliance on infrastructure and real-estate growth. Its banks issued tens of millions of new credit cards each year, with outstanding balances jumping 50% between 2018 and 2023 to well over $1 trillion. Private technology apps such as Alipay and WeChat also started helping consumers secure loans as their digital payment systems soared in popularity.

But when debts go unpaid, a person’s income can be seized by the state to cover their liabilities, leaving debtors with a small allowance to scrape by.

A 38-year-old man petitioned courts in the southern city of Guangzhou to raise his monthly allowance to 12,000 yuan, equivalent to around $1,600, from 9,500 yuan to help pay for a newborn child. Judges denied his request late last year, and instead concluded that his allowance should be cut by nearly 40% because he was already getting too much, court records show.

A black market has emerged to serve people on the blacklist. In one case, Shanghai authorities busted a ring of scalpers who were booking high-speed rail tickets on behalf of debtors who were barred from doing so themselves. In early 2021, authorities tracked down a debtor who had been using the service and took him into custody, according to a local court.

The current system gives priority to protecting creditors—often powerful, state-owned institutions—at the expense of helping struggling individuals. Scholars who study the issue say China urgently needs a nationwide personal-bankruptcy system to achieve leader Xi Jinping’s goal of making the country more equitable , by forcing creditors and debtors to share the costs of soured loans.

“A personal-bankruptcy system is a mechanism for the redistribution of wealth,” Li Shuguang, a scholar who has advised the government on bankruptcy policy, wrote in a Chinese magazine commentary online last summer.

Movement on the issue has been stymied in part by opponents who believe such a system would only encourage more people to shirk their debts.

One woman’s saga

For Qin, the former factory worker, easy access to credit backfired badly.

As a 16-year-old in 1999, Qin boarded an overnight bus from her home in rural southern China to the grimy manufacturing hub of Dongguan, north of Hong Kong.

Her parents, who are farmers, couldn’t afford a payment of less than $15 needed for her to take a high-school entrance exam. She vowed to make it on her own, and found work in factories producing slippers and golden jewellery.

A few years later, Qin secured her first credit card. With it, she bought a computer to teach herself to type so she could land a better job.

When the bill was paid, Qin said she tried to cancel the card. “Keep it for an emergency,” the bank clerk told her.

Qin’s career flourished and she eventually moved to the metropolis of Guangzhou. By 2010, she said, she was managing bidding for a company that supplied fire-safety equipment to real-estate projects. Her nest egg steadily grew from the lucrative commissions she earned in the property boom.

When the property sector slowed, she jumped industries. An acquaintance had been involved in a startup that was developing software to help small-business owners collect WeChat data to generate more foot traffic and aid marketing efforts.

Qin said she invested the equivalent of around $150,000 of her savings into the venture.

The startup burned through her initial investment as it tried to get the software up and running. Qin said she then agreed to start putting some of its expenses, including office supplies, rent and employee salaries, on her credit cards, and to tap personal credit lines she had obtained via WeChat and Alipay.

A roadshow by the company was warmly received, she said. But its prospects dimmed after the Covid pandemic hit.

The company’s struggles left Qin with the equivalent of tens of thousands of dollars of debt. Phone calls from debt collectors have become a daily occurrence.

With no option of bankruptcy, Qin concluded that a new job was her only way out of trouble.

“As long as I’m still living and have a life, I can work hard to earn the money back,” she said.

That path has faced unexpected difficulties. In 2021, while preparing for a business trip to Shanghai, more than 700 miles northeast of Guangzhou, Qin realised that she had lost her access to high-speed rail, where a government I.D. is required to buy a ticket. She took the slow train—and later quit that job in part because the travel restrictions were making it impossible.

Local officials didn’t respond to questions about Qin’s case and The Wall Street Journal wasn’t able to verify some details of her account.

Today, Qin is working in a shop in Foshan, south of Guangzhou, selling traditional Chinese medicines. With a base salary of about $400 a month, she has found it tough to put a dent in her debts, but said she has managed to pay back two of her credit cards so far, with about $40,000 still to go.

Qin is trying to stay optimistic, hoping that medicine will be in high demand as China’s population ages, opening the door to bonuses and potentially even running her own shop. Still, she has had to get creative to earn the cash to pay her debts.

Her current role requires Qin to collect payments from customers using a digital wallet on WeChat. But she said that function on her account has been frozen several times since 2022, leaving Qin to seek help from her family.

She decided not to tell her parents about the full scale of her troubles, however.

If they knew the truth, Qin said, they “wouldn’t be able to sleep.”