Home > Uncategorized > Donald Trump and the Republicans: The art of the steal

Donald Trump and the Republicans: The art of the steal

from Dean Baker

During the campaign Donald Trump boasted that he could kill someone on Fifth Avenue and it wouldn’t affect his standing among his supporters. Whether or not this is true, this appears to be the approach that Trump and his fellow Republicans are taking to their role in governing. The basic story is that they can rip off the public as much as they want, because ain’t no one going to stop them. They could be right.

The most immediate issue is Trump’s refusal to sell his assets and place the proceeds in a blind trust. This was a practice followed by every president in the last half century. The idea is that the president should be making decisions based on what they think is good for the country, not based on what they think will fatten their pocketbooks.

Trump’s proposal in this area is essentially a joke. The idea is he turns over the operation of his empire to his kids. It’s not clear how this helps at all. His kids will never discuss any business issues with him and also have no opportunity to discuss policy with their father or father-in-law?

Perhaps more importantly, he knows what properties are in his empire. This means that if he decides to make an issue of the crackdown on opposition by Turkey’s president, Recep Erdoğan, it is likely that Erdoğan will retaliate against the Trump resorts in Turkey. The same applies to his dealings with many other countries.

We shouldn’t have to rely on a “trust me” pledge from the president that the financial interests of his family will not be a consideration in his foreign policy. That is exactly why prior presidents put their assets into a blind trust. And, there is little reason to believe that Trump is more honest than our past presidents.  

It is also important to realize that divestment of Trump’s empire is not an insoluble problem. The key is to have an appraisal process, which would set a value on his assets. Trump can then lock in this price by buying an insurance policy, which would protect him from the risk that the assets may be sold off at a lower price than the appraisal. The proceeds from the sale of properties would be put directly in a blind trust. Any extra funds go to a designated non-Trump affiliated charity.

From the point of the appraisal forward, Trump would have no financial stake in his empire. That would end this huge conflict of interest problem.

It appears that Trump’s indifference to problems of conflict of interest is likely to extend to his top appointees as well. Politico reported on evidence that Steven Mnuchin, Trump’s nominee as treasury secretary, used the money from a tax-exempt foundation under his control, to engineer a lobbying campaign. According to the article, when Mnuchin was chair of the bank OneWest, he used funds from the bank’s foundation to make payments to nonprofits that later lobbied on the bank’s behalf.

If Politico’s information is accurate, and the payments were in fact made to support a lobbying campaign, then it would be a clear case of tax fraud. A nice twist to this story is that as treasury secretary, Mnuchin would be responsible for overseeing the IRS.

We have yet to see the full list of top level appointees, but it is already clear that it will include some of the richest people in the country. Wlibur Ross, the billionaire private equity fund manager, is slated to head the Commerce Department. His pick for secretary for the Department of Education is Betsy DeVos, an heir to a multibillion-dollar fortune.

If Trump refuses to hold himself to the same ethical standards as past presidents, it is difficult to believe that he will pressure his cabinet and top advisers to avoid conflicts of interest. And given the wealth of some of his appointees, there will be plenty of opportunity for conflict.

In fact, it looks like the tidal wave of conflicted government has already spilled over to the legislative branch. Senate Majority leader Mitch McConnell announced that he will not recuse himself from voting on Elaine Chao, Trump’s pick to head the Department of Transportation. Chao also happens to be McConnell’s wife.

When it comes to ethics in government, presidents usually start out setting high standards which they don’t always live up to. By refusing to put his holdings in a blind trust, Trump is starting in the sewer. It is likely to go down from there.

See article on original site

  1. patrick newman
    December 6, 2016 at 1:18 pm

    The good news is Trump’s regime will be an enormous boost for investigative journalism. There is no other good news until impeachment proceedings begin!

  2. F. Kautz
    December 6, 2016 at 2:08 pm

    I thought this was a site for serious economics research rather than political punditry or post-election venting. Try Salon, Slate or Huff Post instead.

  3. Nancy Sutton
    December 6, 2016 at 7:26 pm

    Might it be true that ‘serious economic research’ has gotten us, pretty directly, to the situation outlined by Mr. Baker? I thought this site is for ‘post austisme’, ‘real world’ economics. Perhaps the only disagreement is semantic.

  4. Rhonda Kovac
    December 7, 2016 at 9:12 am

    Baker is, of course, right on all counts. However, the astronomical conflict of interest violations of the entire lobby system — as a result of which our government has already been bought and sold many times over — make, by comparison, the examples cited here hardly the stuff of outrage. Not that Baker shouldn’t have said what he did. But that, if we are to get anywhere fixing things, the focus should be on the bigger, underlying problem.

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