The New Face of the Plutocracy
By Will Banyan (Copyright © 12 April 2017)
“A newspaper criticized me and said, ‘Why can’t they have people of modest means?’ Because I want people that made a fortune! Because now they are negotiating [for] you, OK?”
“New Administration is lookin’ good. Haven’t seen this many billionaires in 1 place since I staked out Bilderbergs w/Alex Jones. Good times.”
According to Time magazine’s feature on its “Person of the Year” (Dec. 19, 2016) – Donald J. Trump – the president-elect’s three floor “princely pad” in Trump Tower, New York, was “not a natural place to refine the common touch.” Trump’s apartments were “gilded and gaudy, a dreamscape of faded tapestry, antique clocks and fresco-style ceiling murals of gym-rat Greek gods.” Yet it was here, “under dripping crystal, with diamond cuff-links”, where staff must wear cloth slipcovers on their shoes, “so as not to scuff the shiny marble or stain the plush cream carpets”, that the president-elect lived. Trump, though was not only well aware of the contradiction, but basked in it, jubilantly telling Time’s reporters: “What amazes a lot of people is that I’m sitting in an apartment the likes of which nobody’s ever seen. And yet I represent the workers of the world.” “I care more for the workers”, he told Time when discussing his plan for corporate tax breaks; “My love is for the workers.”
During the campaign Trump seemed to exhibit that “love” when he repeatedly attacked the “hedge fund managers, the financial lobbyists [and] the Wall Street investors”, who were backing Hillary and had become “very wealthy” from globalization while leaving “millions of our workers with nothing but poverty and heartache.” Yet there were also moments when Trump seemed to take their support for granted; where he seemed to demonstrate, in the words of Trump critic and former Brietbart reporter Michelle Fields, that he “isn’t an outsider who understands the struggles of the American people”, but one of the entitled class he claimed to oppose. Trump’s controversial declaration that “I could stand in the middle of 5th Avenue and shoot somebody and I wouldn’t lose voters,” was proof, Fields argued, of his sense of “entitlement” and that he “doesn’t value his supporters.”
Towards the end of the campaign, New York Magazine (Oct. 29, 2016) reported on an “unmanageable candidate”, who did not seem to be “all that focused on what happens to the masses of white, nativist, working-class voters who have coalesced around him…” Indeed Trump seemed indifferent to the fate of those who flocked to see him:
I got really mad at him the other day,” Trump campaign manager Kellyanne Conway told me. “He said, ‘I think we’ll win, and if not, that’s okay too. And I said, ‘It’s not okay! You can’t say that! Your dry-cleaning bill is like the annual salaries of the people who came to your rallies, and they believe in you!’ ”
The Great Betrayer
Since his victory, alongside the narratives of presidential incompetence and White House chaos, the notion of betrayal has become of one of the dominant themes for the various forces arrayed against Trump. But this has been fuelled by Trump’s failure to live up to some of his more contentious promises, and his willingness to engage with the same “Washington insiders”, lobbyists and financiers he claimed to oppose. For critics it is a story about how a brash billionaire, a member of the top .01 percent of the US population that holds 80 percent of the nation’s wealth, could on the one hand claim to represent the “workers” and pledge to “drain the swamp”, and yet on the other not only seek the support from the same moneyed elites he ran against, but also include them or their proxies in his new government.
These critics now claim the majority of Trump’s supporters, especially those from the “Rust Belt” and “Fly Over Country”, have been “conned”. “You’ve been had”, Nicholas Kristof informed Trump voters in the New York Times (Feb. 25, 2017); accusing Trump of “betrayal”, because “instead of draining the swamp”, Trump was “wallowing in it and monetizing the presidency.” Citing President Trump’s moves to roll-back financial regulations and anti-corruption measures, Rolling Stone’s Matt Taibbi argued Trump had exposed himself as just a “tool for Wall Street” and a “stooge for industry.” These two measures, argued Mike Konczal from the Roosevelt Institute, “should confirm that Mr. Trump has no intention of taking on Wall Street.”
Other commentators lamented that he was a “con man—an elite in sheep’s clothing” who had deceived “small-town Trumpists who thought they voted for one of their own but elected a man who mingles solely with rich assholes” (Slate, Nov.11, 2016). Trump was a “con artist” and a “Trojan Horse for the .01 percent”, argued Richard Eskow, whose “grift” would deliver “a government of, by, and for the very elites he campaigned against.” “He’s not leveling the playing field, but rather, he’s boosting the already-rich”, wrote neo-conservative Trump critic, Jennifer Rubin, with a “pro-business, pro-rich guy agenda.” Pat Garafalo of US News & World Report (Feb. 03, 2017), took issue with Trump’s “sham” populism, claiming that he was “looking to be one of the best friends best banks ever had, a 180-degree reversal of the populist, working-class savior he played on the campaign trail.” As for Trump voters, according to The Nation, “they’re headed for an epic case of buyers’ remorse.”
Paul Waldman, writing in the Washington Post (Nov. 11, 2016), hailed Trump’s “greatest trick” of “convincing voters he’d be ‘anti-establishment’.” Trump’s claim that he would attack the “establishment” was “near the heart of [his] appeal to the disaffected and the disempowered,” and yet, early in the transition:
An organizational chart of Trump’s transition team shows it to be crawling with corporate lobbyists, representing such clients as Altria, Visa, Coca-Cola, General Electric, Verizon, HSBC, Pfizer, Dow Chemical, and Duke Energy. And K Street is positively salivating over all the new opportunities they’ll have to deliver goodies to their clients in the Trump era. Who could possibly have predicted such a thing?
The answer is, anyone who was paying attention. Look at the people Trump is considering for his Cabinet, and you won’t find any outside-the-box thinkers burning to work for the little guy. It’s a collection of Republican politicians and corporate plutocrats — not much different from who you’d find in any Republican administration.
Trump, argued Waldman, had successfully “tapped into…[the] sense of powerlessness, that unseen forces are pulling the strings and manipulating ‘the system’ for their own benefit” held by much of the electorate. Even though Trump would still be “uniquely dangerous”, he will not be “a threat to the establishment, or the system” in fact the “wealthy and powerful will have more wealth and power when he’s done, not less.” Despite voting for change, he concluded, Trump voters just got “suckered.”
Some, though, were relieved by Trump’s apparent backsliding during the transition process. Bloomberg (Dec. 1, 2016) reported that “executives and investors” were “sighing with relief” as Trump had switched from “using Wall Street as a punching bag to a farm team…” Some, including hedge fund manager Whitney Tilson, who had backed Hillary had been sceptical that Trump would “pivot back to the center”, were ecstatic:
“I can take glee in that — I think Donald Trump conned them,” said Tilson, who runs Kase Capital Management. “I worried that he was going to do crazy things that would blow the system up. So the fact that he’s appointing people from within the system is a good thing.”
While such criticism can be dismissed as the post-election stage of the effort to question Trump’s legitimacy as an “outsider”, it also reflects the reality that throughout the campaign Trump actively courted the support of his billionaire peers – the same .01 per cent he claimed to oppose. Trump offered a radical agenda, under the rubric of ‘America First’ that appealed to their interests, but also offered an alternative to the liberal cosmopolitan consensus. He also presented an opportunity for these plutocrats to participate in this project, either directly in his Cabinet, or indirectly as external advisers or through their nominated cut-outs. What has emerged from this process is a new face of plutocratic rule – a government of the very wealthy and the super-rich – that stands for the 1 per cent.
Trump’s Billionaire Clique
From early 2016 there were already signs that Trump’s attacks on Wall Street, hedge fund managers and financiers lacked sincerity. Trump had not only welcomed support from these moneyed elites, but in some cases actively sought it out as he ran out of cash for his campaign. While the much anticipated “presidential pivot” failed to eventuate, Trump successfully broadened his appeal to those he was otherwise attacking. That Trump would seek out billionaire supporters was the clearest sign that he was delivering a revolution from above, one designed to suit the 1% rather than the “workers” he claimed to “love.”
Some of Trump’s key billionaires and multi-millionaire backers included:
- Thomas Barrack, last in the billionaire range in 2013, is Chairman of Colony Capital Inc. an investment firm that manages some $34 billion in assets, mostly for Arab clients. Considered to be one of Trump’s “few genuine friends”, Barrack has known Trump since the late 1980s. During the campaign Barrack served on Trump’s economic advisory council and helped organize the Trump super-PAC Rebuilding America Now; after the election he served as Chairman of the Presidential Inauguration Committee. Barrack also facilitated Trump’s decision to employ Paul Manafort as his campaign manager, meeting with Manafort and recommending the consultant as “the most experienced and lethal of managers” and “a killer” (New York Times, 08, 2017). Widely expected to “wield enormous influence in Trump’s Washington as the person perhaps closest to the new president outside of his immediate family”, Barrack declined a position in the Trump Administration, preferring stay on the sidelines. He has continued to defend Trump, whom he considers a “great man”, taking issue with the excessive media scrutiny of Trump’s new administration, arguing that he only need be held to “the promises and policies upon which he was elected” (CNN, Feb. 26, 2017).
- Peter Thiel, who made his fortune as co-founder, former chairman and CEO of Paypal, an early investor in Facebook, and a founder of the Clarium Capital Management hedge fund, is currently chairman of Palantir Technologies and has an estimated worth of $2.7 billion. Thiel, a member of the Bilderberg Group’s Steering Committee, donated $1.25 million in support of Trump’s campaign. In a recent interview with the New York Times ( 11, 2017), Thiel a libertarian who had once supported Ron Paul, credited Trump with a “phenomenal understanding of people” and being “very charismatic.” Thiel considered it a more “plausible risk” that Trump would, against expectations, “change everything way too little.” In addition to providing campaign funds and being a delegate for Trump in California, Thiel also endorsed Trump at the Republican Convention. Trump, he declared “is a builder and it is time to rebuild America” because “[o]ur economy is broken” and “[o]ur government is broken.” Trump’s slogan “Make America Great Again”, he averred, was not about “a return to past”, but in leading the US to a “bright future.”
- Sheldon Adelson, an American casino magnate, Chairman and CEO of Las Vegas Sands and the 14th richest person in the US (worth US$30.4 billion), publicly endorsed Trump arguing the country needed “strong executive leadership” from this “CEO success story” (Washington Post, May 13, 2016). Late in the campaign Adelson provided Trump with at least $5 million in direct donations, plus a further $25 million into an anti-Hillary Super PAC Future 45, seemingly contradicting Trump’s claim he was “the only [candidate] who doesn’t need his money.” Adelson, whose primary concern was Israel’s security, was reportedly inspired by Trump’s strong declarations of support for Israel and his pledge to undo Obama’s nuclear deal with Iran. After meeting with Adelson in December 2015, Trump had called his fellow billionaire “amazing” and appealed to the casino magnate’s first concern, declaring “Sheldon knows nobody will be more loyal to Israel than Donald Trump” (Forward, Dec. 18, 2015).
- Other important elite supporters emerged as Trump secured the nomination. Fortune ( 4, 2016) identified 14 billionaires backing Trump, mostly hedge fund managers or financiers, including: Carl Icahn ($16.1 billion) founder of the Icahn Capital Management hedge fund; Stephen Feinberg ($1.2 billion), co-founder and CEO of Cerebus Capital Management; Stanley Hubbard ($2.3 billion) chairman and CEO of Hubbard Broadcasting; Wilbur Ross Jr. $2.5 billion), chairman and CEO of WL Ross & Co, formerly of Rothschild Inc.; Darwin Deason ($1.2 billion) founder of Affiliated Computer Services; and John A. Paulson ($7.9 billion) president of Paulson & Co.
- In October 2016 nearly 100 former and current CEOs signed a letter endorsing Trump’s economic plan. This roster of the rich comprised, in addition to Thiel and Icahn: former Reebok and Dollar General CEO David Perdue; the co-managing partner of Skybridge Capital, Anthony Scaramucci ($80 million); Co-Founder and former CEO of Home Depot, Bernard Marcus ($4 billion); former General Partner at Goldman Sachs, Lew Eisenberg; and Chairman and CEO of Dune Capital Management, Steven Mnuchin (he was also Trump’s chief fundraiser and head of his campaign’s national finance committee – estimated worth $500 million). They praised Trump’s plan to impose higher tariffs on Mexico and China, and to lift restrictions on exploiting oil and gas as “comprehensive and far-reaching”. “It cuts taxes, stops trade cheating, reduces regulations,” they wrote, “unleashes America’s power energy sector and eliminates our growth-draining trade deficit” (Fortune, Oct. 19, 2016).
- Betsy DeVos, daughter-in-law of AmWay co-founder Richard DeVos Sr (net worth $5.6 billion), initially refused to back Trump. The DeVos family had over the decades given nearly $200 million to the Republican Party in support of various campaigns. Writing in Roll Call in 1997, she conceded that critics were right, the DeVos family donations were about “buying influence” to achieve “limited government and respect for traditional American virtues.” Betsy DeVos had also emerged as the leading advocate of school choice (specifically private or charter schools) through her organization, American Federation for Children. Interviewed by the Washington Examiner in July, DeVos made her support for Trump conditional on him supporting school choice. Trump, the candidate who claimed he could not be bought, soon changed his tune to promote school choice, including a $20 billion plan to expand it. Trump made a strong effort to woo the DeVos family, meeting with key members in Michigan in September; in October four members of the DeVos family donated $245,000 to the Trump Victory Fund.
- Also joining the Trump bandwagon, after initially chiding Trump on Twitter in 2015 for “embarrassing his friends” and the “whole country”, was 85-year old media mogul Rupert Murdoch (worth $13.1 billion). This change of heart came about after two private meetings between the billionaires and some phonecalls from Trump’s son-in-law Jared Kushner early last year. The reason for the turnaround was of course pure expediency: with Trump leading the depleted GOP field, Murdoch strategically decided to back the most likely winner (NY Magazine, May 16, 2016).
A clear policy incentive for this support was that Trump’s core program for fixing the economy explicitly favoured the interests of the .01 percent. As a commentator on MSNBC observed, Trump’s “specific policy proposals”, included:
massive tax breaks for the very wealthy, deregulation of Wall Street, gutting the federal health care law without regard for the consequences for working-class families, and even partial privatization of public schools through a new national voucher scheme.
These measures appealed to many of his plutocratic supporters. Bernie Marcus, for example, portrayed Trump as the alternative to the “over-regulation, over-taxation, over-litigation, and over-spending” of the “Obama/Clinton style of government” that was “hostile to free enterprise.” A vote for Trump, though, would “take the country in a new direction.” Carl Icahn was confident that Trump was “what this country needs at this time”, that he would cut back on regulations and deliver a government that was a “friend to business.” Wilbur Ross justified his support, arguing that “we need a more radical, new approach to government – at least in the U.S. – from what we’ve had before.” Ross also praised Trump’s plan to cut corporate taxes “from 35 percent to 15 [percent]”, because it would “solve…the trade deficit, because it means corporations can cut their pretax margin by 20 percent.”
Pragmatism was also a motivator: there was a real possibility Trump could win. Those with some understanding of Trump’s mindset, his tendency to hold bitter grudges and “get even” with those who failed to support him, but also to handsomely reward loyalty, would know that backing him would most likely have a pay off in terms of White House access, if not more. And for many, being a donor did deliver. Sheldon Adelson’s generosity, for example, secured him a private meeting with Trump ahead of the inauguration, a prime seat at Trump’s inauguration and in February, a “social” dinner with Trump at the White House. But there were much bigger prizes: Wilbur Ross, Betsy DeVos, and Steven Mnuchin all received Cabinet appointments; and Lew Eisenberg is in the running to be US Ambassador to Italy.
Peter Thiel’s support for Trump generated some significant pay-offs after the election. Dubbed the “shadow president” by his employees, according to Politico (Feb. 26, 2017), Thiel was a “near-constant presence” during the transition:
Working with a staff of four to six aides from an office in Trump Tower, Thiel dispatched associates from his investment firms to help staff agencies across the government. Their reach extended from the Department of Commerce to the Pentagon and eventually to the White House…
Three of Thiel’s associates – Kevin Harrington, Mark Woolway and Josh Wright – were seconded to government departments. Later, Harrington, who had worked for Thiel for the past 13 years, most recently as managing director and head of research at Thiel Macro LLC, was appointed to NSC as Deputy Assistant to the President for Strategic Planning. In March, Thiel’s chief of staff at Thiel Capital, Michael Krastios was appointed Deputy Chief Technology Officer in the White House’s Office of Science and Technology Policy. As for Thiel himself, he has rejected a direct role, telling the New York Times that he would prefer to “help Mr. Trump as I can without a full-time position.”
In the Shadows: The Owl Man and the Baker
Perhaps the most important and influential figures in this roster of the .01% who supported Trump’s White House bid, is the shadowy 70-year old hedge-fund billionaire Robert Mercer and his 43-year old daughter Rebekah. A trained computer scientist, Mercer is currently the co-CEO of the hedge-fund Renaissance Technologies (managing $66 billion in investments). Mercer’s actual net worth is not publicly known (although in 2015 the Washington Post estimated it was $12.5 billion) but he is one of highest earning hedge fund managers on Wall Street (ranked 18th by Forbes in its top 25 hedge fund managers), with earnings of $150 million in 2016. Robert and Rebekah Mercer have not only provided critical financial support to Trump’s campaign, but also played pivotal roles, both directly and indirectly in the campaign and transition process.
An elusive figure who rarely gives interviews, Robert Mercer has a number of obsessions that his wealth permits him to indulge. According to a feature article in Bloomberg (Jan. 20, 2016), that includes a $2.7 million model train set, “one of the country’s largest collections of machine guns and historical firearms” and his owls:
Mercer has dubbed his house the Owl’s Nest. Owls seem to be something of a familiar for Mercer. He’s commissioned a succession of yachts, all called Sea Owl, the latest of which stretches to 203 feet, with a pirate-themed playroom for the grandkids and a chandelier of Venetian glass…At the Owl’s Nest, visitors pass through pillars crowned by a pair of owl statues, their wings outstretched as if taking flight.
Owls, or more specifically the Athenian Owl of Minerva or goddess of wisdom, have been appropriated as sacred symbols by secret societies such as the original Bavarian Illuminati, Freemasons and more contemporary groups, such as the Bohemian Grove. No less an authority than David Icke claims the “owl is symbolic of Moloch or Molech, the ancient deity to which children were, and are, sacrificed” (The Biggest Secret, p.357). It is also important to those obsessed with owls – a species specific form of ornithophilia – such as New York Herald owner James Gordon Bennett Jr (1841-1918) who kept an owl in his office and had the Herald building festooned with owl statues. Perhaps Mercer just likes owls and any resemblance to occult owls is a coincidence (see Figures 1 & 2).
But to put things in perspective, a casual reference to the “owl/minerva rule” in a leaked email exchange between Secretary Clinton and her Deputy Chief of Staff Jake Sullivan in 2011 generated endless speculation about whether it revealed an occult/secret society connection. Very little, in contrast, has been said about Mercer’s owl obsession, particularly by the likes of Alex Jones, as one blogger recently observed:
I do like to imagine the batshit insanity we would be seeing from [Alex] Jones right now if Clinton had been elected president instead, and it turned out one of her major financial backers embraced the owl symbol in the way Mercer does…
But for now, there is nothing.
Despite the owls and all their sinister connotations, Mercer’s actual political sympathies seem closer to those of Alex Jones and David Icke. According to one of his former co-workers at Renaissance, cited in Jane Mayer’s lengthy profile of the reclusive plutocrat in the New Yorker (Mar. 27, 2017), Mercer was noteworthy, not only for his “libertarian views” but “his susceptibility to conspiracy theories” such as Clinton’s alleged involvement in CIA drug-running out of Mena airport in Arkansas and in having political opponents murdered. Mercer is also claimed to have: argued that during the Gulf War the US should have taken Iraq’s oil; “downplay[ed] the dangers of nuclear war”; disputed the science behind climate change; and, more controversially, asserted that “humans have no inherent value other than how much money they make…” In addition, Mercer is reportedly a “passionate critic” of fractional reserve banking and supports restoration of the gold standard.
More importantly, the Mercers apparently “see themselves as outsiders, fighting the grip of elite institutions.” According to one of their supplicants, the Mercers believe “there is too cozy a relationship between the establishment media and the political class, and that there needs to be more accountability.” One Republican operative suggested they were driven by a “real disdain for elitism.” The Huffington Post (Mar. 17, 2017), citing a political pollster employed by the Mercers, summarised their views thusly: “Republican elites are too cozy with Wall Street and too soft on immigration, and that American free enterprise and competition are in mortal danger.” In a rare public statement reaffirming their support for Trump, the Mercers criticised America’s “political elite”, who had earned the “disgust” of most Americans for ignoring Bill Clinton’s misdeeds, whilst chastising Trump.
The Mercers interest in such “fringe” politics is reflected in their funding of a curious array of conservative and libertarian foundations and think-tanks. As reported by Bloomberg (Oct. 23, 2014), the Mercers donated some $37 million to various organizations between 2008 and 2014, including the Media Research Center, Citizens United Foundation, Oregon Institute of Science & Medicine, Heartland Institute, Cato Institute, and the Illinois Policy Institute. Most of these were strongly associated with conservative and libertarian causes: the Oregon and Heartland institutes, for example, both dispute the anthropogenic global warming hypothesis; the Illinois Policy Institute tracks wasteful government spending; and Citizens United is a “research and education foundation” that supports a variety of conservative causes, but is notable for its role in the 2010 Supreme Court ruling that lifted the ban on corporations and unions independently financing political ad campaigns.
The Mercers have also funded more eccentric people and causes. This includes the Arizona physician Jane Orient, Executive Director of the American Association of Physicians and Surgeons (AAPS) and a faculty member of the Oregon Institute. Derided in some quarters as a “loon”, “[f]earmongering quackjob”, and as purveyor of dubious medical advice, Orient has questioned both vaccines and climate change, suggested the US Government failed to stop the San Bernadino killings because it was working “on the other side.” She also once argued, perhaps uncontroversially, that some “hard-core” environmental activists supported “world government.” Mercer has attended and provided “generous” funding for Orient’s annual Doctors for Disaster Preparedness conference. Furthermore, reports Bloomberg, Mercer both attended and financed the Jackson Hole Summit in 2015 where participants advocated for a return of the gold standard whilst also attacking the Federal Reserve.
The Mercers relationship with this realm of foundations and think-tanks is largely managed by Rebekah, a former Wall Street trader with a dual degree in biology and mathematics and masters of science degree. She is currently Director of the Mercer Family Foundation, and sits on the board of directors of the Media Research Center (2015 Annual Report, p.20) and is a trustee, respectively, of the Heritage Foundation, the Manhattan Institute for Policy Research, American Museum of Natural History and the Calvin Coolidge Presidential Foundation. In 2014 she was on the board of the Government Accountability Institute (GAI), which received at least $2 million from the Mercers. The GAI gained considerable traction with its book Clinton Cash (2015), written by the GAI’s President, Peter Schweizer, which accused the Clintons of profiting from Hillary’s tenure as Secretary of State. Rebekah fits these responsibilities around the homeschooling of her four children and running the gourmet cookie bakery Ruby et Violette with her two sisters.
The Mercers other important investment was in the Breitbart News Network. It has long been rumoured that in 2011, not long after meeting Andrew Breitbart, the Mercers had bought a 50% share of Breitbart News Network (BNN) for $10 million. The Mercers role as co-owners was only recently confirmed by Breitbart CEO Larry Solov when Breitbart sought press credentials through the Senate Press Gallery. Solov affirmed the Mercers owned a stake, but denied they had an editorial role. According to Mayer, though, the deal with the Mercers came with the condition that their long-time collaborator Stephen Bannon be placed on Breitbart’s board. After Breitbart’s death Bannon became CEO. Furthermore:
Rebekah Mercer is highly engaged with Breitbart’s content. An insider there said, “She reads every story, and calls when there are grammatical errors or typos.” Though she doesn’t dictate a political line to the editors, she often points out areas of coverage that she thinks require more attention.
The Mercers involvement in the 2016 election began, not with Trump, but with Senator Ted Cruz based on the polling advice of long-time political operative Patrick Caddell, who had originally been engaged by (now deceased) oil tycoon William Lee Hanley. As related by Mayer, Caddell’s research showed “mounting anger toward wealthy elites who many Americans believed had corrupted the government so that it served only their interests.” And critically, there was a “hunger for a populist Presidential candidate who could run against the major political parties and the ruling class.” Impressed with these figures, Mercer had joined with Hanley to continue funding Caddell’s work until Election Day. Caddell had hoped they would back an independent candidate, but instead the Mercers gravitated towards Cruz “in part because he was an outsider in the Senate—loathed by even his Republican peers.”
In trying to build up support for Cruz, the Mercers constantly referred to Caddell’s discovery of the populist surge. Bloomberg reports that at a private meeting with Cruz, Mercer and some other donors in Palm Beach, Florida in February 2014, Caddell presented his contention that the “country was ready for a Mr. Smith Goes to Washington figure.” According to one participant, the phrase “Trump-like” had been used, meaning that “an outsider candidate should have a good shot in 2016.” Meeting with potential donors later that month in New York, Mercer argued that “mainstream Republicans” like Jeb Bush and Marco Rubio, would struggle to win the White House, instead “only a true outsider with a sense of voters frustrations could win.” Associates of the Mercers confirmed their goal was not tied to any particular candidate, they were “looking for an outsider to shake things up in Washington”, someone who would cause “political upheaval” (Wall Street Journal, Jan. 8, 2017).
At that point Cruz was their man and he received generous funding from the Mercers, who provided $13.5 million to the pro-Cruz super PAC, Keep The Promise I. But even after Cruz failed and he withdrew from the campaign in May last year, the Mercers did not automatically switch to that most “Trump-like” of the candidates, Donald Trump. Instead the Mercers only supported Trump after they were asked. Trump had already reached out to them back in January, when he praised Mercer as a “good man” whilst smearing Cruz as a liar (see Figure 3). The decision to commit to Trump, though, only came in May 2016 after a direct appeal for help from Trump’s daughter, Ivanka, and her husband Jared Kushner. They hosted a lunch meeting in Trump Tower inviting Rebekah Mercer, (accompanied by the president of Keep The Promise I, Kellyanne Conway).
According to the Washington Post’s (Sep.14, 2016) vague account, the Mercer-Trump lunch meeting was a rather cheery affair with a happy outcome for all concerned:
Over sandwiches and salads in a conference room, Ivanka and Rebekah bonded over parenting young children and being the daughters of hard-charging, successful fathers, according to people familiar with their conversation.
Rebekah’s sister Jenji and her mother were already fans of the real estate developer, according to a friend. And now Rebekah was on board: The family would help Trump.
The actual substance of that conversation and exactly what was requested in return for that help is unknown. But what should be clear is that the Trumps had explicitly asked the Mercers for help. And help soon arrived. In June, Bloomberg reported that Mercer was considering “an appeal from Trump supporters” to create a super-PAC to support Trump. Then later that month Robert Mercer was spotted attending a $50,000-a-seat Trump fundraiser at Manhattan’s Le Cirque restaurant in June. Subsequently, in June Rebekah Mercer took over as Chair of Keep The Promise I, which was renamed Make America Number 1, and an extra $2 million was poured in to run ads in support of Trump.
Inviting the Mercers into the tent, however, came at the cost of giving them leverage over Trump’s White House bid; it seems even Trump had his price, and that the Mercers, for all their anti-elitism, were not above acting like other plutocrats and seeking to control “their” candidate. About a month after the meeting in Manhattan, on July 1, Trump announced that Kellyanne Conway – whom he praised as a “tremendous asset” who was “terrific on TV” – had joined his campaign as a senior adviser to campaign manager Paul Manafort and to work with the national polling team (Politico, Jul. 01, 2016).
Then in August at a fundraiser in the Hamptons, according to various accounts, Rebekah Mercer had a 30-minute face-to-face meeting with Trump where she persuaded him his campaign was a “disaster” and that Manafort was a liability. She convinced Trump to demote Manafort, and to promote Conway in his stead, and to also hire the Executive Chair of Breitbart, Stephen Bannon as campaign CEO and David Bossie, former president of the Mercer-funded Citizens United Foundation as deputy campaign manager. The details were apparently worked out the next morning by Rebekah, Ivanka and Jared at Trump’s golf club in Bedminster, New Jersey. In addition to the new team, Trump also engaged the data polling services of Cambridge Analytica; another Mercer investment. As one source quoted in The Hill (Aug, 17, 2016) put it: “The Mercers basically own this campaign…They have installed their people… And now they’ve got their data firm in there.”
The impact of this effort is not to be underestimated. Numerous profiles have credited both Bannon and Conway with rescuing Trump’s campaign; while a recent study from Harvard found that Breitbart had created a “pro-Trump media sphere” that succeeded in shaping the broader media agenda, including its negative coverage of Hillary Clinton. Mercer used his money “very effectively”, according to Nick Patterson, a former senior Renaissance employee interviewed by the New Yorker; in fact “Trump wouldn’t be President if not for Bob [Mercer]. It doesn’t get much more effective than that.”
Trump has been suitably grateful to his benefactors. In a statement to the Washington Post (Sep. 14. 2016) Trump praised Rebekah Mercer as “a spectacular woman and leader.” “Her greatest desire is to make America great again,” the statement went on. “Our country is lucky to have her support.” In December 2016, Trump attended Mercer’s annual costume ball – the theme was “Heroes and Villains” – held at Owl’s Nest, where he reportedly thanked the Mercers at length, and then joined the Mercers, Bannon and Conway at the head of the table. The Mercers were also given prime positions at Trump’s inauguration (Figure 4) “The Mercers are incredible people”, Trump told the Wall Street Journal (Jan. 08, 2017), “who truly love this country and go all out to protect America and everything it stands for.”
But there was more. While Robert Mercer took no direct role in the transition, Rebekah, as one of four major donors, was appointed to the 16-person executive committee overseeing the transition. She was reportedly successful in lobbying against the appointment of Trump critic Mitt Romney as Secretary of State, but also for the appointment of Senator Jeff Sessions as Attorney-General, as well as for key White House roles for Stephen Bannon (she wanted Bannon as Chief of Staff, making the pitch to Trump in a late night call, but he was made Chief Strategist instead) and Kellyanne Conway. She also supported former US Ambassador to the UN, John R. Bolton as Deputy Secretary of State, though Trump later rejected Bolton allegedly because his “brush-like moustache” was not photogenic enough.
The paradox of the Mercers is they are acting like the same “elites” they purport to despise. To be sure, they seem to be true believers in the radical nationalism of Trump’s “America First” platform, but exactly like the “elites” they claim to hate, they have used their vast wealth, through philanthropy and political donations, to reshape the political system. As David Magerman, a dissenting employee at Renaissance, has pointed out: “Mercer has surrounded our President with his people, and his people have an outsized influence over the running of our country, simply because Robert Mercer paid for their seats.” But it has not all been plain sailing for the Mercers.
Chief Strategist Bannon reportedly “returns Rebekah’s phone calls when he can” but “relations are strained” feeding her growing frustrations. She has apparently complained of there being “no rhyme or reason to the people [Trump’s] appointing” and that “too many Beltway Republicans” have been hired. Most bad news included reports that Kellyanne Conway “has largely been sidelined.” Then, after Bannon was suddenly removed from the National Security Council and reportedly threatened to quit, Mercer had to convince him to stay on because it was a “long-term play.” The reason for her concern was obvious, as one “GOP operative” told Politico: “If Bannon leaves the White House, Bekah’s access and influence shrinks dramatically.” More ominously, Trump has recently displayed the limits to his gratitude, publicly declining to confirm that he had confidence in Bannon and downplaying Bannon’s role in the campaign as he had joined it “very late” and “I’m my own strategist.” Bannon’s days—and Mercer White House access—may be numbered.
Such are the travails of the .01 percent…
In the Grip of the “Kochtopus”?
In contrast to the Mercers, whose support was explicitly sought out, no such courtesies were extended to billionaire brothers Charles and David Koch, respectively CEO and Executive Vice President of Koch Industries, and each worth $48 billion. On the contrary, Trump had repeatedly attacked the Koch brothers, mainly on Twitter (Figure 5), claiming they were turning the other Republican candidates into “puppets”, but not him. The Koch brothers, in turn, had voiced strong opposition to Trump’s candidacy, and refused to donate to his campaign (or Hillary’s). “We haven’t put a penny in any of these campaigns, pro or con,” Charles Koch told the media in April last year. “That’s not what we do. What we’re trying to do is build alliances to make the country better.” This was somewhat disingenuous, even though they did not support Trump directly, “they spent heavily to get out the vote for Republicans in key swing states. This helped secure Trump’s win.”
The sheer scale of what the Koch brothers were able to achieve during the 2016 election, primarily through their front organization, Americans For Prosperity (ostensibly “founded by ordinary citizens”, but actually created in 2003 by David Koch) was enormous. According to analysis by academics, Theda Skocpol, Alexander Hertel-Fernandez and Caroline Tervo:
Publicly available numbers suggest that [Americans for Prosperity] AFP’s grassroots organizing made a real difference – and indirectly helped Trump, who had little campaign capacity of his own. In Wisconsin, for instance, AFP claims that it reached over 2.5 million voters in phone banking and canvassing efforts. In North Carolina, AFP claimed over 1.2 million calls and 120,000 door-to-door efforts, or nearly the entire reported margin of victory for Trump. And in Pennsylvania, AFP claims it made over 2.4 million phone calls and knocked on over 135,000 doors, more than twice Trump’s margin of victory in that state. AFP’s grassroots efforts were especially pronounced in Florida, where AFP boasts that its people knocked on a record-breaking one million doors throughout the state to help re-elect Senator Marco Rubio. Hillary Clinton lost the state by just over 100,000 votes (TPM Café, Nov. 21, 2016; emphasis added)
Charles and David Koch have spent billions over decades to build up “a vast network of political action committees and advocacy groups…to influence legislation and elect conservative politicians who share their aims of cutting regulation, taxes, and government spending” (The Week). Not surprisingly the Koch brothers soon emerged as “a winner in the transition” (Guardian) as an “as unprepared President-Elect Trump started to fall back on people and plans offered by the Koch network” (TPM Café), in fact Trump had “surrounded himself with people tied to the Kochs” (Politico).
The Koch-linked appointees included: Vice President Pence, a long-time recipient of Koch campaign donations; CIA Director Mike Pompeo (business ties); Commerce Secretary Wilbur Ross (“friend” of David Koch); Attorney General Jeff Sessions (campaign contributions); and Energy Secretary Rick Perry (campaign contributions). Analysis by the Center for American Progress estimated that at least a third of Trump’s advisers, transition team members and top appointees have links to the Koch brothers. Marc Short, for example, the new Director of Legislative Affairs was former President of Freedom Partners Chamber of Commerce, one of the Koch brothers many non-profit political front organizations.
A recent report in The Intercept (Apr. 05, 2017) highlighted yet more appointees who had strong links to the Koch brothers, mainly through Freedom Partners. This included: Donald McGahn, White House Counsel, had through legal firm Jones Day provided legal advice to Freedom Partners and other Koch-funded organisations, i360 and Americans For Prosperity; Ann Donaldson, McGahn’s chief of staff, also of Jones Day had provided legal services to Freedom Partners and i360; Andy Koenig, a Special Assistant to the President and Policy Special Assistant was a former vice president of Freedom Partners; Andrew Bremberg, director of the White House Domestic Policy Council, consulted for Freedom Partners; Bethany Scully, from the Office of Legislative Affairs, worked for Freedom Partners; and Brian Blase, a special assistant to the president working on healthcare issues, came from the Mercatus Center, a Koch-funded think tank at George Mason University.
Vice-President Pence has Koch network people in his staff as well. Among them are Andelize Castillo, his Deputy Director of Public Engagement and Intergovernmental Affairs, was previously Chief Operating Officer and Chief of Staff for the LIBRE Initiative and The LIBRE Institute, “the Latino outreach arm of the Koch network”; and Stephen Ford, Pence’s director of speechwriting who had previously worked as a speechwriter for Freedom Partners.
Unlike the Mercers, the policy objectives the Koch brothers hope to achieve through Trump are easier to discover. As Skocpol, Hertel-Fernandez and Tervo note:
Although widely unpopular with the mass public, the Koch policy agenda of tax cuts for the rich, union busting, Medicare privatization, business deregulation, and evisceration of environmental and global warming measures is ripe to be rammed through a GOP-dominated Congress and sent to the desk of a president who needs Koch-affiliated personnel, understands very little about policy issues, and will be looking for victorious bills to sign into law. The stage is perfectly set to advance the core Koch ultra-free-market agenda…
The AFP site lists a number of objectives (Figure 6), some of which have already been fulfilled by Trump – such as the appointment of Gorsuch – while others, such as opposing the proposed Border Adjustment Tax, remain to be achieved:
Trump has reportedly delivered on other key Koch goals, including his executive order rolling back Obama’s “Clean Power Plan”, a move celebrated by AFP in a letter to its members as a “great step forward for lifting undue burdens on business and workers and ensuring the government does not pick winners and losers in the marketplace.” Publicly the Koch brothers, especially Charles Koch remain opposed to and determined to fight many of Trump’s policies, especially the border adjustment tax and the immigration crackdown. But the enmity may prove to only be skin-deep; Trump is always willing to cut a deal.
In December last year there appeared to be a moment of peace when Trump and David Koch had an impromptu meeting at Trump’s Mar-a-Lago club in Florida where they talked “about the campaign and Trump’s preparations for his administration.” Then this month, according to Politico (Apr. 09, 2017), Trump and David Koch had another “friendly chat” again at Mar-a-Lago. David was dining with his twin brother Bill (who is not part of Koch Industries and had supported Trump) and Trump confidante Chris Ruddy when Trump stopped for a discussion that was described as “agreeable” by some sources.
Charles Koch has not had that pleasure….yet.
It’s All Connected!
The seeming ubiquity of the Koch-connected, not only from the Vice-President down, but also to include some of those otherwise identified as belonging to the Mercer camp—such as Kellyanne Conway who performed consulting work throughout 2016 for Americans for Prosperity—has prompted other speculation. Such connections have been explored by Adam Khan, “a former marketing consultant and tech guru turned Twitter investigator”, dubbed by Buzzfeed (Feb. 13, 2017) as the “most effective” of the “vigilante investigators” aiming to expose the “corruption in Trumpland.” In a number of Twitter entries (Figure 7), Khan suggested the Mercers were perhaps subordinate to or at least still part of the Koch network and had infiltrated the Trump administration in service of “common goals.”
On the face of it, Khan’s conjecture seems plausible. Robert Mercer turns up a number of times in Jane Mayer’s Dark Money (2016), which provides to date the most detailed account of the origins and reach of the Koch network. Mayer notes that Mercer had been a “relative newcomer” to the Koch summits but he was “immediately impressed by the organization” and “shared the Koch’s antipathy toward government regulations” (p.260). She also cited Mercer’s Renaissance Technologies as an example of a Koch donor “ensnared in serious legal problems”, with the firm under investigation for avoiding $6 billion in taxes (p.361). In her New Yorker feature on the Mercers, Mayer added more detail on the relationship:
By 2011, the Mercers had joined forces with Charles and David Koch… The Mercers attended the Kochs’ semiannual seminars, which provide a structure for right-wing millionaires looking for effective ways to channel their cash. The Mercers admired the savviness of the Kochs’ plan, which called for attendees to pool their contributions in a fund run by Koch operatives. The fund would strategically deploy the money in races across the country, although, at the time, the Kochs’ chief aim was to defeat Barack Obama in 2012. ….[T]he Mercers reportedly began giving at least a million dollars a year to the Kochs’ fund. Eventually, they contributed more than twenty-five million.
Clearly there is considerable overlap in the political views and objectives of the Kochs and Mercers, in particular a dislike of government taxes and regulations, reflected in the fact that the Mercers joined the Koch network. But evidence that the Mercers are mere pawns for the Kochs is thin. According to Mayer, the Mercers split with the Koch network over its failure to unseat Obama in 2012. Rebekah Mercer was unimpressed with the refusal of the Kochs to provide an “accounting of what had gone wrong, and when they ignored her she decided to start her own operation.” Politico (Sep. 07, 2016) noted she was “frustrated” with their lack of political aggression and that they were “much more supportive of trade and immigration.” The Mercers had stopped attending the Koch political summits and “dialled back their giving to the network.” A Koch network donor told Politico that Mercer “wasn’t totally aligned with us. She’s much more populist.” So perhaps the split was real.
The Mercers and Kochs certainly differed on the big issue of free trade, for example. In their rare public statement, issued last year in support of Trump, the Mercers averred that if Trump had said he was “for open borders, open trade, and executive actions in pursuit of gun control, we would certainly be rethinking our support for him.” The Koch brothers, though, remain staunch supporters of free trade, reportedly spending up to $40 million in support of the Trans-Pacific Partnership and in 2015 Freedom Partners implored Congress to support Trade Promotion Authority because “open international trade” is “one of the most effective means of increasing individual opportunity and well-being here and abroad.”
The Common Touch
Despite their previous collaboration the Mercers and Kochs represent different factions of the plutocracy. Although sharing a preference for small government, they differ on key policy details, the Mercers are radical nationalists and the Kochs, with their support for open borders and free trade, are globalists. The Mercers have scored an unexpected victory through Trump, though it is unclear how much longer their moment in the sun will last. The Kochs, though at odds with Trump, have still managed to infiltrate his administration through the sheer size of their network. But it is merely shading on a pattern where Trump has filled his administration with business people, where billionaires and multi-millionaires like Carl Icahn, Gary Cohn, Dina Powell, Reed Cordish and Chris Liddell all occupy critical White House roles, and where the President’s Strategic and Policy Forum is headed by the Chairman and CEO of Blackstone, Steve Schwarzman.
As President-elect Trump was only too happy to tell an adoring crowd late last year in Iowa he was not interested in people of “modest means” for his Cabinet, he mainly wanted people who had “made a fortune.” And in that he succeeded. Ahead of the recent release of financial disclosure forms for 180 members of the his administration, some of his officials boasted that Trump had brought in “a lot of people …who have been very blessed and very successful by this country and have given up a lot to come into the government by setting aside a lot of assets.” Analysis of the forms by the Washington Post (Apr. 01, 2017) showed that 27 White House officials had a combined wealth of $2.3 billion.
For all his rhetoric, this is not a government of the workers that Trump claims to “love”. He did not prepare his campaign in consultation with the staff who keep his palatial apartment clean or seek advice from the doorman at Trump Tower. Trump’s key confidantes and supporters were other billionaires, including his friends (Barrack), business partners (like Icahn, who had bailed him out of trouble), fellow travellers (Thiel, Marcus, Ross, Mercer), or opportunists, who bought their way into his campaign (Adelson). His transition team was likewise dominated by the plutocrats and their numerous proxies. Even the plutocrats Trump excluded from his campaign have more influence over his administration than the “workers of the world” Trump gushed about to Time magazine.
To a degree the system has been blown up, the revolutionaries have taken the palace, but instead of being a workers revolution, it is just another group of aristocrats waving the red flag. And as is often the case, the old order soon re-establishes itself and the radicals are either co-opted or liquidated…
To be concluded in Part 4