On August 5, Donald Trump announced the formation of his Economic Advisory Council. Aside from a token academic that he’d never actually bothered to meet prior to the announcement, the all-male panel read like a rogues list ripped straight from the pages of Billionaires & Ballot Bandits by investigative reporter Greg Palast. Trump’s inner circle, which after an outcry over the glaring sex bias was supplemented by eight women, features some of the worst offenders when it comes to political powerbrokering for personal gain. But that’s just pay-to-play politics, and is therefore not so surprising. What did raise some eyebrows was Trump’s decision to embrace a group of guys he’d previously lambasted for “getting away with murder” due to their super-sized tax breaks: hedge fund managers, whom he’d also said half the time had “luck more than talent.” But The Donald can no longer afford to be picky, since the billionaire on “reality” TV only needs some actual real cash to fund his floundering campaign. In this week’s Best Democracy Money Can Buy: Election Crimes Bulletin, Flashpoints’ Dennis J. Bernstein gets the lowdown from Palast on Trump’s new hedge fund BFFs and the hidden payoff that’s facilitating their cozy relationship.
Greg Palast: You don’t have much of a sense of humor, Dennis. Don’t you ever tell assassination jokes?
DB: Am I not subtle enough?
Palast: Well, you know, I figured that was a loaded question — bang!
DB: So Trump manages to keep the headlines, but maybe that’s better for him because if people really start delving behind the scenes, look into who supports him, what he’s been up to, this is where his real trouble is.
Palast: I’d like to think so. I’d like to think that instead of parsing his seventh grade sense of humor that we would be looking at the billionaires behind him. It’s fascinating because it was Donald Trump who told us, when billionaires like me write checks, we expect something back from the politicians, and a lot more than we put in. Now that he’s been exposed as not a billionaire — he just plays one on TV — he’s gone to the very guys that he’s attacked.
When I say the very guys he’s attacked, I don’t mean just other billionaires, he’s now created a counsel of 13 economic advisors. I love the way our lamestream press has said these are wonderful guys — really? Almost all of them are hedge fund managers, that is speculators. These are the very guys that Donald Trump said are lazy, are just gamblers, that they get tax breaks for gambling. Sometimes they’re lucky, sometimes they’re just losers, they don’t create a single job, and then we give them tax breaks for taking our money. He’s blasted these guys all over the place as basically scum. He made Bernie Sanders sound like Adam Smith when he went after these guys. And he says, I’m going to take away their biggest tax break.
Bernie Sanders said the billionaires’ tax break for hedge fund speculators — known as ‘carried interest’ — in a Sanders presidency, they’d go. So Hillary Clinton had to go along and she said, okay, whatever Bernie says, me too — for now. She’s going to get rid of carried interest and Donald Trump said he would get rid of carried interest —because it’s one of the few tax breaks that he as a real estate billionaire has no access to. He doesn’t get any of that. It’s not his tax break, it’s for these hedge fund speculator scum that he doesn’t like.
Now he’s appointed the hedge fund speculator scum to be his economic advisors, including, at the very top of the list, John Paulson, JP. That’s the guy we’ve actually had two podcasts on. He’s so dark and dangerous, and I’m going to use the word ‘evil’ — I don’t usually make statements like this but I kind of have to. He’s a major target in my investigation in my upcoming film, Best Democracy Money Can Buy. JP is the guy that pushed the mortgage market over the cliff and made $5 billion in a single year, more money than any human since the pharaoh, by destroying the US housing markets and pushing foreclosure. And he then made another billion bankrupting the Royal Bank of Scotland. He sold them bad mortgage securities, knew that they were bad, knew they would go bankrupt, so then he bet the company he knew he was going to bankrupt, he bet that they would go bankrupt. He bet against mortgages that he knew were bad so he made sure they went bad. The Security Exchange Commission busted his assistant and charged his company that he worked with, Goldman Sachs… Charged them $500M, which is couch coins for these guys.
He made $5 billion in a year from that, then he took down the General Motors auto parts division, Delphi. Took it over… every single union job was eliminated — every one! 35,000 workers, all their jobs were sent to China. All of them. Not one union job remained. So he bankrupts and destroys the auto parts division at General Motors, makes billions off crashing the mortgage market, makes another billion crashing the biggest bank in England, which had to be bailed out by their tax payers. This is Trump’s advisor, whom he personally attacked before. But, dig this, JP, the foreclosure king, held a big fundraiser for him at Cipriotti, which is actually inside the New York Stock Exchange. It’s in the bowels of the Stock Exchange and it has these chandeliers that cost more than all your ancestors made in nine generations, Dennis.
So he held a fundraiser. If you wanted to be a host, like JP, you paid a minimum of $350,000 if you wanted to break bread with the Donald and JP. Who was the other guy that set this up? Steven Mnuchin. Now, I want to spell his name because I want you to know, for those of you who are Second Amendment aficionados. MNUCHIN. By the way, that’s a joke.
Steven Mnuchin, he is the head of the fundraising enterprise for Donald Trump, who said he didn’t need any money and would self-fund his own campaign. Now he’s getting money from Mnuchin, who was a marauder from guess where? Goldman Sachs. No points for guessing that one. Another Goldman Sachs cat who then went out and started his own creepy illegal foreclosure operation, where he’s having robo-signings of mortgage foreclosure notices and all that.
The Feds came down on this guy, but he still has billions in his pocket. He’s the guy that produces the X-Men films. He’s put together this whole panel for Trump. He’s given a half million dollars to Trump — that’s the legal limit. Another half million dollar donor is Harold Hamm, who is from Continental Energy, he’s the fracking king. That’s not a surprise because Trump has said we should just drill everywhere, including in your grandma’s grave. That’s not a surprise, what is a surprise are all these hedge fund guys.
DB: For how long did we hear that this man was self-financing his campaign? How many times?
Palast: And what’s amazing, here’s the guy who actually, in a way, busted the system. He said, when billionaires give you their money, they expect a lot back — in multiples. Now, here he is, literally on his hands and knees before Steven Mnuchin, before Harold Hamm, before JP, the foreclosure king, he’s literally on his hands and knees begging. And Steve Feinberg, who is the head of something called Cerberus Capital. For those of you who have a more classical education, Cerberus is the three-headed dog from hell. Now, a guy who calls his company after the three-headed dog from hell, you’ve got a bit of an idea of the business practices that he adheres to, right? Then you’ve got Stephen Moore, the guy who started Club for Growth, which is somewhere to the right of Genghis Khan.
There’s only one single economist, the right winger, Peter Navarro. Everyone else is in hedge funds, the guys he said were scum. The other thing that’s interesting is that, except for Navarro — the single professor — every single one of these other guys are his top donors. It’s like he literally took his top 12 donors and made them his economic advisors. It was that simple. He took his donor list, the top 12 donors, boom, you’re on. No kidding!
What I like about it in a way is it’s wrong… Now Hillary and Obama, they take care of their people. Penny Pritzker — who should be breaking rocks on a chain gang, but she’s a billionaire, so she’s exempt — she is our Secretary of Treasury. She is the person who raised three-quarters of a billion dollars for Barack Obama in 2008. And what does she get? She gets a cabinet post.
Now, Trump is already talking about filling cabinet posts with his people, but he doesn’t even cover it up. He doesn’t make them take five or six of his big donors and pad the committee with a bunch of other mere millionaires who don’t give him money. His 12 top donors are his 12 chief advisors. Why didn’t he just have a Dutch auction? My professor, George Stigler, University of Chicago, who got the Nobel Prize in Economics actually suggested that, that we just have a bidding war for president and for political offices and the public gets the money. We be better off than having scoundrels.
DB: It’s funny, because our friend from Illinois is back in the news… the Governor…
Palast: Oh, Rod Blagojevich.
DB: He was just openly saying, I’m going to sell you this, this is going to cost you $100K, that office is $250K.
Palast: You know what his problem was, he thought small. He was actually trying to sell a US Senate seat for a couple hundred thousand dollars. What a fool! No wonder they busted him. They were probably laughing listening in. I mean, how much do you think Hillary Clinton’s seat went for? We know what Obama charged to put Penny Pritzker into the Department of Commerce and it was not a hundred grand, it was in the hundreds of millions. He was a working class guy, so he thought in very small numbers. I think that they busted him because he was bringing down the market price of a senator.
Palast: But I mentioned that Trump, Sanders, and Clinton all came out against this carried interest billionaires’ loophole. Now we know that Hillary is never going to go through with it. Obama said he’d close that loophole, never even proposed closing the loophole. Never even proposed it. Just used it in the campaign. Sanders obviously would’ve done it, but I understand he’s not going to be president now. But, Trump, you could say maybe he’ll really do it. He’ll get rid of the billionaires’ loophole because it’s not his billionaires’ loophole. But, as it turns out… I won’t go into all the crazy details, but carried interest reduces the capital gains on what these hedge funds rip out of the economy’s heart, what they bleed out of the economy. Instead of paying 40%, they only have to pay 24% tax. But what Trump has said is, I’m going to eliminate that… instead, you’ll pay 15% tax. That little footnote, I didn’t hear from him in a speech, it came out sideways in a little paper. So he’s saying, I’m going to tell these billionaires they can’t get their tax break anymore that caps their tax at 24%, I’m going to cap it at 15%. No wonder they all jumped on his committee and gave him a half million dollars, because that little asterisk literally saved these guys billions.
Palast: Of course they’re going to pony up a half million dollars. Basically, each of these guys put up one-third to half a million dollars each to be an advisor to Donald Trump.