Donald Trump’s campaign is reportedly strapped for cash. Small-dollar donations are running far behind their 2020 pace. Big Trump rallies aren’t yielding his biggest cash hauls. Some large-dollar donors are hesitant, in part because they worry (with good reason) that their money will be used not for the campaign but to pay his legal bills. So he has been wooing right-wing billionaires.
I have no idea how successful he’ll be, but it seems highly likely that at least some billionaires will provide substantial sums to a man who tried to overturn the last election and has been open about his authoritarian intentions — using the Justice Department to go after his political opponents, rounding up millions of undocumented immigrants and putting them into detention camps and more.
Which raises the question: Why would billionaires support such a person?
After all, it’s not as if they’ve been suffering under President Biden. Economists, myself included, often remind people that the stock market is not the economy. Low unemployment and rising real wages — both of which, by the way, the Biden economy has delivered, even if many people don’t believe it — have much more relevance to most people’s lives.
But stock prices are probably a much better indicator of how the very wealthy, who hold a lot of financial assets, are doing. And although in 2020 Trump predicted a stock crash if Biden won, the market has, in fact, been hitting record highs under the current administration.
Why, then, back a candidate who more or less promises to unleash social and political chaos?
One straightforward answer is that the wealthy will almost certainly pay lower taxes — and corporations will be less regulated — if Trump wins than if Biden stays in office.
If you believe, like some leftists, that Republicans and Democrats are basically the same — that both serve the interests of corporations and the elite — you’re wrong. The modern Democratic Party isn’t, despite what prominent Republicans say, Marxist or socialist. It does, however, have a track record of raising taxes on the wealthy to pay for social programs. Notably, the Affordable Care Act used new taxes on high-income individuals to pay for health care subsidies.
These new taxes helped lead to a jump in the effective federal tax rate on the highest-income 0.01 percent of the population: President Barack Obama did much more income redistribution than many people realize. Trump, by contrast, passed a big tax cut that favored the wealthy and largely reversed the Obama-era rise in their effective tax rate. (Why do people still refer to Trump as a populist?)
Biden is now proposing significant tax hikes on corporations and the wealthy. And he wouldn’t even have to pass legislation to preside over tax increases: Most of the provisions in the Trump tax cut will expire at the end of next year unless Congress renews it.
But I’d say that the prospect of lower taxes shouldn’t be enough to get billionaires to support Trump.
After all, how much would the extra money really matter to people whose lifestyles are already incredibly lavish? My sense looking in from the outside is that among the very wealthy, making more money is less about what they can afford than it is about prestige — making more than others in their peer group. And the thing about higher taxes is that because they would apply to everyone, they wouldn’t alter the rat race: Your perceived rivals would take the same hit you would.
And a Trump return to power would make America a scarier place, which should matter much more even to billionaires than a few percentage points on their tax rate.
But do they understand that?
Last year, writing about the brief infatuation of tech bros with Robert F. Kennedy Jr., I noted that the very wealthy are often less informed about what’s going on in the world than many ordinary citizens, because they live in a social bubble. The danger Trump poses to American democracy is — or should be — obvious. It may be less obvious, however, to people who, because of their wealth, seem to think they know better and can surround themselves with confidants who assure them that they do know better.
Consider the case of Elon Musk. Need I say more?
I’d also speculate that even billionaires who recognize Trump’s authoritarian leanings probably imagine, if they think about it at all, that their wealth will protect them from arbitrary exercises of power.
They should — but won’t — learn from the experience of the Russian oligarchs who helped put Vladimir Putin in power. They eventually discovered that once you’ve installed a dictator, your wealth isn’t the shield you might have thought it was and you may still find yourself sent to Siberia. And before you say that such worst-case-scenario thinking can’t possibly apply in America, bear in mind that the Trump alarmists have mostly been right and the apologists have mostly been wrong; I’m old enough to remember when Trump’s former acting chief of staff wrote that “If He Loses, Trump Will Concede Gracefully.”
So will Trump get support from billionaires? Probably. If he wins, will they end up regretting their choice? My guess is they will — but by then, it’ll be too late.
