The Plutocrats' Peerless President

What is America’s most egregious consumer fraud? Donald Trump, populist.

“Today,” Trump proclaimed in his inaugural address, “we are transferring power from Washington, D.C., and giving it back to you, the people.” He then filled his administration with billionaires, lobbyists and ideologues in thrall to Republican donors, consigning his legislative agenda to the plutocrats’ pet, House Speaker Paul Ryan (R-Wis.). Left for his base were misbegotten trade wars, white identity politics scapegoating immigrants and minorities, and sulfurous attacks on their perceived cultural enemies.

These diversions obscure the scope of Trump’s betrayal. The firing of Veterans Affairs Secretary David Shulkin ― the apparent prelude to a privatization scheme for veterans’ care ginned by the Koch brothers ― is but the latest example.

The heart of Trump’s agenda is the plutocratic craving for tax cuts and disdain for governmental efforts to protect the environment, regulate financial institutions, preserve unions and maintain a social safety net for ordinary Americans. Supported by the donor class, Trump is waging an aggressive war against the economic interests and security of the very people who elected him. His pseudo-populism is the plutocrats’ Trojan horse.

For wealthy Trump supporters, income inequality is not a worry ― it’s a richly deserved reflection of their achievements. The pressing needs of others ― education and job retraining for those displaced by the new economy; affordable college for the children of struggling families ― matter not. Though the uber-rich are few, the unrestrained free-for-all that is our campaign finance system empowers them to purchase public policy.

And they do. Roughly 40 percent of all campaign contributions during 2016 came from .01 percent of the adult population. The GOP ruling class is exemplified by the Koch brothers ― whose political dependent, Mike Pence, is Trump’s vice president, and whose former chief fundraiser, Marc Short, is Trump’s legislative director. For them, stoking racial and cultural resentments among the base is simply a cheap recruiting tool, providing votes for politicians who, like Trump, advance their narrow interests.

December’s tax bill demonstrates their stranglehold on both the president and his party ― perfectly illuminating plutocracy in action. Why, after all, did virtually every GOP congressman ― and all 52 Republican senators ― support a bill that trashes their stated commitment to fiscal prudence? And why did Trump push it with such unwonted industry?

Simple. As Rep. Chris Collins (R.-N.Y.) admitted: “My donors are basically saying, ‘Get it done or don’t ever call me again.’” If Republicans failed to pass this bill, Sen. Lindsey Graham (R-S.C.) predicted, “the financial contributions will stop.”

To rationalize their obeisance, Trump and the GOP recycled the empirically discredited claim that massive tax cuts pay for themselves. No credible independent analyst believes this. What the cuts will do, over time, is shift our tax burden onto ordinary Americans while benefiting the top 1 percent ― who already control 40 percent of our wealth.

President Donald Trump shakes hands with House Speaker Paul Ryan (R-Wis) as Republicans celebrate the passage of a sweep
President Donald Trump shakes hands with House Speaker Paul Ryan (R-Wis) as Republicans celebrate the passage of a sweeping tax cut bill last December.

A salient example is Trump himself, who will garner millions of dollars from individual tax cuts and whose family will gain millions more from tax breaks for real estate ventures and a doubling of the estate tax exemption. In a seriocomically Dickensian counterpoint, Ryan cited the secretary in Lancaster, Pennsylvania, whose weekly $1.50 increase in take-home pay would cover her Costco membership. Let them eat cake ― in bulk.

Unlike Ryan’s grateful secretary, wealthy Americans can cut their own taxes simply by incorporating to exploit the drastically reduced corporate tax rate. Overall, middle-class taxpayers will get a ― temporary ― tax cut of about $900; the top 1 percent an average cut of over $50,000. And by undercutting the Affordable Care Act, the tax bill increased the cost of health insurance for millions of Americans while diminishing the quality of coverage. Little wonder Republicans jammed it through Congress without a single hearing.

Like a sorcerer’s apprentice, this ill-considered wealth transfer conjures a host of fiscal calamities. It turbocharges income inequality ― adding at least $1.5 trillion to the deficit over 10 years and thereby saddling future generations with crippling debt. It casts our creditworthiness into doubt, potentially raising our interest rates ― which, in turn, would make servicing our debt costlier, diminishing the government’s ability to pay for other budgetary needs. The result could be economic stagnation ― or worse.

Selling off the government is Trump’s modus operandi.

The subsequent budget deal, passed in February, magnifies this maleficence, producing trillion dollar deficits with no end in sight. Such a staggering shortfall starves spending for Medicaid, food stamps, educational programs, childcare, disability programs and Head Start. It renders Trump’s surviving semi-populist program ― infrastructure spending ― dead on arrival for lack of federal money. And it licenses Republicans to insist they must redress yawning deficits by attacking that bête noire of its donor class ― Social Security and Medicare.

Altogether, Trump’s economic agenda is an X-ray of hypocrisy in the service of plutocracy. Corporations, Trump assured us, would use the money generated by tax cuts to raise wages and create new jobs. Instead, they are spending on stock buybacks which enrich wealthy shareholders ― including, not incidentally, the corporate chiefs who ordered the buybacks.

Equally pleasing to plutocrats and corporations is Trump’s scorched earth attack on regulations designed to protect ordinary Americans, conducted by a handpicked army of extraordinary Americans ― erstwhile representatives of industries seeking to eradicate governmental oversight while funneling millions to Trump and his party.

A vivid illustration of how money lubricates deregulation is provided, appropriately, by the oil and gas industry. After underwriting over 10 percent of Trump’s $107 million inaugural fund, the payoff was immediate ― Trump flooded the Environmental Protection Agency with unqualified political janissaries inimical to its mission, spearheaded by an unqualified and hostile director, Scott Pruitt.

Trump greeted Scott Pruitt, head of the Environmental Protection Agency, as the president prepared to sign an executive order
Trump greeted Scott Pruitt, head of the Environmental Protection Agency, as the president prepared to sign an executive order in March 2017 reversing Obama-era climate change policies.

Pruitt is the quintessential environmental saboteur ― an ardent climate change denier and creature of the fossil fuel industry. As Oklahoma’s attorney general, he sued the EPA 14 times while, as emails obtained by The New York Times confirm, he “closely coordinated with major oil and gas producers, electric utilities and political groups with ties to the [Koch brothers] to roll back environmental regulations.”

As EPA director, he is gutting its enforcement capacity; triggering an exodus of environmental scientists; expelling expert consultants deemed insufficiently sympathetic to industry; seeding its website with misinformation, and consulting with industry representatives in meetings designed to leave no paper trail.

Nothing captures Pruitt’s political and moral bankruptcy better than his sweetheart rental deal with the wife of a lobbyist for the petroleum industry ― $50 a night for a prime location on Capitol Hill, a fraction of the going market rate, due only when Pruitt slept there. This as climate and weather-related disasters, including wildfires and hurricanes, killed 362 people in 2017 while causing $306 billion in damage.

But selling off the government is Trump’s modus operandi. His Food and Drug Administration chief has battled the agency on behalf of the drug industry. His Federal Communications Commission chairman repealed net neutrality regulations, creating a class system which damages consumers while benefiting telecom conglomerates. At the Consumer Financial Protection Bureau, archconservative Mick Mulvaney has killed restrictions on abusive payday lenders.

Education Secretary Betsy DeVos, formerly an investor in for-profit colleges and student debt collectors, now hamstrings oversight of predatory and fraudulent for-profit colleges like Trump University that cheat unwary students ― including veterans ― of millions in federal aid dollars while unleashing student debt collectors to harass them.

Nor have Trump and the GOP ignored the tender sensibilities of financiers offended by Dodd-Frank, passed to curb the financial excesses which precipitated the calamity of 2008. They now are softening or eliminating key safeguards of that legislation ― among other things, by exempting smaller banks from the ban against trading risky securities and loosening the capital requirements for all but the very largest banks. Should history repeat itself, many more Americans could face financial ruin.

Trump surrounded by members of his cabinet in March 2017.
Trump surrounded by members of his cabinet in March 2017.

Predictably, Trump has targeted another adversary loathed by right-wing plutocrats ― labor unions. At the National Labor Relations Board, Slate reports, Trump’s appointees have reversed “policies that helped smaller unions organize, bolstered the bargaining rights of franchise employees, and shielded workers from union-busting tactics.”

But Trump’s anti-labor coup de grace was appointing Neil Gorsuch to the Supreme Court. Pending there are two cases critical to workers’ rights. One could eviscerate the negotiating and political power of public employee unions selected by the majority of their members by barring the collection of mandatory dues. In the other, businesses seek to roll back protections for low-wage and nonunion workers.

In both cases Gorsuch is expected to be the deciding vote. Little wonder that his candidacy was advanced by the Federalist Society, an organization funded by wealthy donors determined to populate the courts with ideologues who expressly share their contempt for unions and government regulation.

In the end, the quintessential plutocrat equates governance with the venal pursuit of self-enrichment ― peerlessly personified by the Trump family, which is relentless in its voracious exploitation of power and position to amass yet more money, conflicts of interest be damned. That Trump’s administration is awash in petty grifters ripping off taxpayer dollars confirms the power of his example.

The classic definition of “plutocracy” is “government by the wealthy.” Thanks to Donald Trump, America has arrived.

Richard North Patterson is a New York Times best-selling author of 22 novels, a former chairman of Common Cause, and a member of the Council on Foreign Relations.