Trump has filled his Cabinet with a goon squad of rich donors | The … – The Outline
For as long as there have been incredibly rich people, Americans have worried that they would use their vast wealth to tilt the political system in their favor. In the 2016 election, Trump’s rhetoric riffed off of that populist tradition. He gleefully mocked his opponents as puppets of the Koch Brothers and bragged about the way he had “bought” off politicans with contributions. He told The Wall Street Journal, “As a businessman and a very substantial donor to very important people, when you give, they do whatever the hell you want them to do.” At the same time he claimed he was free of such influence because he was self-funding, striking a populist tone: “I am not accepting any money from anybody. Nobody has control of me other than the people of this country.”
In the end, Hillary Clinton raised far more money than Trump yet still lost the White House, a rare feat in a country in which the better-funded candidate tends to win. Trump won one of the most narrow election victories in American history by mobilizing white voters on a platform of racially exclusionary populism. But so far, Trump’s actions haven’t squared well with his populist campaign style. Though he claimed to self-fund, his campaign ended up relying on big donors, many of whom are eager to shape his inchoate agenda. While Trump may have run on a populist platform, his early appointees suggest fealty to the establishment. This could spell trouble for him, because the preferences of the Republican base don’t always sit well with the big donors.
Though Trump’s Cabinet and advisors are still being appointed, it’s already clear that donors will play a bigger role in his administration than in any other, despite his populist campaign. His first move as president-elect was to bring in Reince Priebus, the chair of the Republican National Committee and voice of the GOP establishment, as chief of staff. The enigmatic and staunchly right-wing Mercer family, which supported Trump through the Make America Number 1 SuperPAC, is being rewarded with a place in Trump’s inner circle. Rebekah Mercer, who gave $450,000 to the Trump joint fundraising committee, was given a key position on the president-elect’s transition team, despite a lack of political experience (after a stint on Wall Street, she managed a gourmet cookie company). Reporting in Politico suggests Mercer pushed strongly for the nominations of Republican hard-liners Jeff Sessions (for attorney general) and Michael Flynn (for national security advisor), and has worked to ensure Trump’s nominees are in line with conservative groups like the Federalist Society, a conservative legal advocacy organization. Mercer’s father, Robert, the co-CEO of Renaissance Technologies, a hedge fund that has outstanding disputes with the IRS, is also a major Trump donor. The elder Mercer is an advocate of the gold standard (in which all money would be backed with gold) and has poured some his vast resources into right-wing think tanks, websites, and documentaries.
Trump is rewarding people who gave him money with key positions
Trump nominated nearly a dozen donors for Cabinet-level or high-ranking administration positions. According to OpenSecrets, nine of Trump’s appointees contributed to his campaign or allied PACs. Two other appointees, Betsy DeVos (education secretary) and Todd Ricketts (deputy commerce secretary), come from families who gave $1.8 million and $1.3 million respectively to Trump’s campaign, affiliated PACs, and the Republican Party during the 2016 cycle.
Having such a large number of donors in a Cabinet is unprecedented. According to Politico, “Donors also represent 39 percent of the 119 people Trump reportedly considered for high-level government posts, and 38 percent of those he eventually picked.” In the past, even whiffs of potential conflicts of interest or pay for play were enough to sink a potential nominee. Obama considered Democratic mega-donor Penny Pritzker for commerce secretary in 2008, but she withdrew before the nomination process (though she later filled the position in 2012 and came under fire for her political contributions). Obama’s pick for Health and Human Services, Tom Daschle, took himself out of the running because of back taxes and his work as a highly compensated advisor to healthcare companies, which presented a possible conflict of interest. Needless to say, President-elect Trump hasn’t concerned himself with reducing potential conflicts of interest when choosing appointees.
The examples of this are myriad. Trump appointed Steven Mnuchin, a former Goldman Sachs banker who contributed $425,000 to Trump’s campaign and served as the campaign’s national finance chair, as treasury secretary. Mnuchin is almost comically plutocratic — he drove a Porsche to college, named his hedge fund after the dunes behind his mansion in the Hamptons, and was a producer on Suicide Squad. He profited massively off of the foreclosure crisis, running what was described as a “foreclosure machine” that once took the house of a 90-year-old woman “who owed the bank 30 cents but sent a check for 3 cents.”
For education secretary, Trump appointed Betsy DeVos, the daughter of billionaire Richard DeVos, who cofounded Amway and owns the Orlando Magic. The younger DeVos is a major Republican donor who has worked tirelessly for school vouchers, charter schools, and cuts to education spending, all while fighting unions tooth and nail. For commerce secretary, Trump tapped Wilbur Ross, a billionaire donor who gave $200,000 to the joint fundraising committee Trump set up with the GOP, and whose main policy priority is reducing the corporate income tax.
Nine of Trump’s appointees contributed to his campaign or allied PACs.
For deputy commerce secretary, Trump selected another big donor, Todd Ricketts, co-owner of the Chicago Cubs and son of billionaire Joe Ricketts, who founded Ameritrade. Trump nominated wrestling magnate Linda McMahon, a longtime donor to his campaign and foundation, to head the Small Business Administration. For labor secretary he tapped fast-food scion Andrew Puzder who, combined with his wife, contributed $332,000 to Trump’s campaign. Pudzer openly hopes to replace human workers with robots. Other donors were smaller but no less freighted with cronyism. Trump’s pick for secretary of state, Rex Tillerson, gave $2,700 to Trump’s campaign, though the corporation of which he is CEO, Exxon-Mobil, has spent millions spreading climate change denial and lobbying against efforts to stop climate change, positions Trump supports.
During his campaign, Trump’s 13-member economic advisory council included Stephen Feinberg, the owner of Cerberus Capital Management, who contributed $339,400 to Trump (his wife gave another contribution of the same size) and four other big donors. For his Council of Economic Advisers, he is considering Larry Kudlow, who is not a distinguished economist but rather a supply-side snake oil salesman and radio show host with a history of making comically bad predictions. In total, Trump had far more white, male donors advising him on the economy than women and people of color combined.
Normally, big donors are granted cushy ambassadorships, not high-ranking Cabinet positions. Under Obama, Noah Mamet, a Democratic party consultant who raised more than $3 million for the president’s campaign, was appointed as ambassador to Argentina despite never having visited the country. Colleen Bradley Bell, a television producer, cited her experience working on The Bold and the Beautiful as an example of her qualification to be ambassador to Hungary (Bell raised at least $500,000 for Obama). Yet Trump’s loyalty to his donors has yet to gain the flurries of coverage that attended purported pay to play at the Clinton Foundation. Indeed, as The New York Times recently reported, “Loyalty appears to be paramount for Mr. Trump, until it isn’t.” The paper suggested that because Rudy Giuliani and Chris Christie weren’t getting Cabinet positions, Trump wasn’t rewarding loyalists. But in reality, Trump is simply rewarding a different type of loyalist: His Cabinet has the most big campaign donors in history. Rather than drain the swamp, Trump has filled it with his donors. And those donors don’t represent the diversity, or the policy preferences, of the American population.
The donor class is stronger and whiter than ever
Though Trump claimed repeatedly throughout the campaign that he would self-fund, rumors of the demise of the donor class have been greatly exaggerated. In my report for Demos, Whose Voice, Whose Choice? co-authored with political scientists Brian Schaffner and Jesse Rhodes, we explore campaign contributions made between Jan. 1 and June 30, 2016. Clinton had 190,314 donors reported to the Federal Election Commission, and Trump had 28,597.
Sixty-four percent of Trump’s donors were white men (despite white men making up only 36 percent of the adult population), and 32 percent were white women. Despite the fact that people of color make up a quarter of the adult population, only 3 percent of the money raised by the president-elect came from people of color. Unsurprisingly, all of the donors who Trump has elevated into his administration so far have been white, and only two were women.
The class demographics are no more representative. Individuals with a net worth greater than a million dollars make up only 3 percent of the country’s adult population, but 24 percent of Clinton’s donors and 17 percent of Trump’s donors. These numbers are even starker when we examine the share of the money coming from millionaires (who tend to make larger contributions). Forty-two percent of Clinton’s contributions came from millionaires and 27 percent of Trump’s. A recent back-of-the-envelope calculation estimates that Trump’s Cabinet has a net worth of $11 billion, a number that could eventually rise to $35 billion.
Though Trump relied less on millionaire donors than Clinton, he did raise most of his money from large donations. Among contributions greater than $200 (and thus legally required to be reported), 42 percent of Trump’s came in amounts of $5,000 or more, compared to 29 percent of Clinton’s. Trump’s donors don’t represent the demographics of the people and certainly aren’t a populist base.
What does Trump’s donor class want?
Elite Republican donors, those who contributed more than $5,000, are more supportive of cutting back on domestic spending than other Republican adults. Republicans largely dislike the Ryan Budget, which includes huge cuts to spending on Medicare, Medicaid, and Social Security, but elite Republican donors support it. Already, Paul Ryan is working to ram through his privatization of Medicare, and Texas Republican Rep. Sam Johnson is advocating a plan to “save” Social Security by slashing benefits. Bowles-Simpson, a less extreme plan than the Ryan Budget that still includes cuts to social programs and tax hikes, has little support among the Republican rank and file but more support among big donors.
Rather than drain the swamp, Trump has filled it with his donors.
Big donors love big tax cuts, for themselves. Donors are eager to extend the Bush Tax Cuts for wealthy earners, though the public has little appetite for these changes. A recent survey suggests that Americans in every state are favorable toward tax hikes for those earning more than $250,000 a year. Here again, Trump’s policy proposals hew far closer to the donor class than the general public. He’s expressed support for budget-busting tax cuts, which would coat the pockets of the wealthiest Americans. A recent Tax Policy Center analysis estimates that in 2025, more than half of the benefits of Trump’s plan would go to the wealthiest 1 percent, to the tune of $317,000 per household each year. Elite donors are also more supportive of repealing the Affordable Care Act, a policy with a slight majority of support among the general public. Trump recently appointed Republican Rep. Tom Price to direct Health and Human Services, suggesting he’s prepared to gut the ACA, potentially costing millions their health insurance.
What about Trump’s central issue — the border fence? The prominent narrative is that donors reject draconian immigration policies like those of Trump. Headlines like “Top GOP donors: Be like Bush on immigration” and “GOP must embrace pro-immigration policy, big donors say,” suggest that big donors are a force for liberal immigration policy. But in reality, Republican donors are more supportive in general of allowing the police to question people they suspect to be undocumented. Republican donors are also more supportive of increasing border patrol and are more likely to oppose action on climate change. When combined with the fact that Trump said that global warming is a hoax invented by the Chinese and recently appointed a “close ally of the fossil fuel industry” to head the Environmental Protection Agency, this is quite worrying.
The Republican donor class members will do little to stop the wildest excesses of Trump’s anti-immigrant, anti-women, and anti-environmental agenda. They will work to prevent the president-elect from following through on his “populist” pledges. GOP donors are eager to dismantle Social Security, Medicare, and Medicaid, while implementing massive tax cuts for the wealthy. They yearn for a strong military presence that is amply funded by slashing money dedicated to helping the poor, rather than increasing taxes. And Trump’s blueprints for the government are following suit. His infrastructure plan is a massive handout to corporations that lacks any benefits for workers and environmental protection. The Sunlight Foundation has begun tracking Trump’s extensive conflicts of interest and the ways he has already started to intermingle governing and his business interests. It has documented more than 32 conflicts of interest so far, almost one for each day Trump has been president-elect. Trump’s tax plans would blast holes into the budget while enacting a massive upward redistribution of wealth to the rich. Dismantling the Affordable Care Act would leave millions of Americans (including his supporters) without health insurance. And Trump has expressed support for privatizing Medicare, a key part of Ryan’s agenda.
Progressives can seize this opportunity to attack Trump — he’ll quickly find himself struggling to mesh his phony economic populism with the demands of his donor class. The recent electoral defeat of North Carolina Gov. Pat McCrory symbolizes how activists can use unpopular policies to galvanize progressive victories. But so far, it appears that Trump will follow the lead of his donors, who are finding firm footing in his administration and will play leading roles in advising him on economic issues. Far from representing a populist break from the past, all indications suggest that Trump will be more closely tied to his donors than any of his post-war predecessors. Trump will govern as the Republican donor class demands, exposing his agenda for what it is: a plutocratic agenda wrapped in white nationalist populism.
Sean McElwee is a policy analyst at Demos.