by Ernst Wolff
During his election campaign, Donald Trump presented himself as the champion of America’s blue collar workers. He promised to ‘bring jobs back home’, create millions of well-paid new jobs, and raise the standard of living of the middle and the working class. He called himself an ‘enemy of the corrupt establishment’ and vowed to ‘dry the swamp in Washington’.
In the final stages of his campaign, Trump announced that he was planning to make Steven Mnuchin his secretary of the treasury. Steven Mnuchin is a former Goldman Sachs banker and a close ally of one of the world’s most notorious speculators, George Soros. One of Trump’s election videos had featured Soros as a symbol of the ultra rich and their insatiable greed.
On election night, Trump held a victory speech in which he praised Hillary Clinton, whose imprisonment he had been demanding only a day earlier. Shortly after, several names of the staff on Trump’s “transition team”, designed to fill four thousand top jobs in Washington, emerged. Among them were lobbyists of companies like Koch Industries, Walt Disney, Aetna, Verizon, and Goldman Sachs. The headquarters of the transition team were put up in a law and lobbying firm in Washington, i.e. right in the heart of what Trump during his campaign had denounced as ‘the swamp’.
The first names discussed for cabinet posts were those of New York’s ex-mayor Rudi Giuliani, the former speaker of the House of Representatives, Newt Gingrich, and New Jersey’s Governor Chris Christie. All three are long-standing members of the Republican establishment, which Trump had constantly attacked during his election campaign. Meanwhile we also know that Steve Bannon, not only editor of the ‘Breitbart’ website, but also a man who once worked for Goldman Sachs, will become Donald Trump’s top advisor and that the Rothschild bank’s ex-partner billionaire Wilbur Ross is being considered for the post of trade minister.
Wall Street has already reacted extremely favorably to Trump’s first moves. Investors were so grateful that they drove the Dow Jones to new record highs within two days of the election. The financial industry’s gratitude probably also honored Trump’s plans of cutting corporate taxes by 20%, lowering income taxes for the 0.1 percent, increasing military spending and easing regulations on trading and banks.
US electoral deceit has a long tradition
All of Trump’s decisions following his election prove beyond doubt that he has consciously deceived his voters, most of them victims of the ongoing economic downturn in the US. He never planned to improve working people’s living conditions. He used the common man’s despair, frustration, his rage and his lack of education to assume power and will use his presidency in order to implement measures that will only serve himself, his ilk and, above all, the financial industry which he has always been part of.
Such electoral deceit is not new in the US. During his two election campaigns in 2008 and 2012, Barack Obama promised to end all US wars, close Guantanamo, stabilize the state budget and end the social divide.
Today we know that Obama is the first president of the United States ever who has constantly waged war for eight consecutive years, that Guantanamo has not been shut down, and that the US is more heavily indebted than ever. We also know that the ultra rich are richer, the middle and the working class are poorer, and social inequality is greater than ever before.
Blatantly lying to the electorate has a long tradition in the US: Exactly one hundred years ago, Woodrow Wilson was elected president during World War I after a campaign in which he promised to keep the US out of the war. Three weeks after his inauguration in March 1917, as commander in chief, he declared war on Germany.
It is also not uncommon for the US mass media to fiercely oppose a candidate, thereby ultimately helping him to power. When US Congress was to vote on the proposed establishment of a central bank in 1913, the financial industry together with the corporate media launched a vicious campaign against this new organization and claimed that it would limit and undermine the rights of the financial industry.
The majority of US citizens, believing what they were told and hoping for the Fed to curb banking power, demanded that Congress approve of the Fed. That way, the American people, consciously misled by politicians and the media, acted as midwives in the establishment of the Fed, which would turn out to be the financial industry’s main tool for their suppression.
This time it’s different
Trump’s deceit of the electorate, however, will have more dramatic consequences than that of any of his predecessors, including Barack Obama. Obama’s first term began with the financial crisis of 2008, which he managed to solve by declaring the banks “too big to fail” and using public funds to reimburse their private owners for their losses.
Obama’s deceit remained largely unnoticed by the general public, because the US central bank Federal Reserve immediately started printing huge amounts of money to fill the gaps in the state budget. But meanwhile eight years have passed, in which trillions of dollars have been pumped into the markets at ever-lower interest rates without managing to achieve anything close to a recovery of the real economy.
Therefore, Donald Trump will start his new job under conditions, which are completely different from those of all of his predecessors. He will face a real economy that is stagnating with most of its productive jobs outsourced to low-wage countries. He will face an over-heated financial sector with huge bubbles in the stock, bond and real estate markets, all of them waiting to burst. He will also face a central bank whose possibilities are almost exhausted, with the only options remaining being those of further money printing (which in its final stages will inevitably lead to hyperinflation) and a further lowering of interest rates into negative territory (which will inevitably destroy the classic basic banking business of lending).
Under these premises, Trump’s election promises to ‘bring jobs back home’ and create new, well-paid jobs across the country, will very quickly be crushed by reality. However, Trump not only made promises that he won’t be able to keep, he also appealed to the rage and hatred of his voters against foreigners, immigrants, disabled people and homosexuals. He announced that Muslims would be denied entry into the US, vowed to build a wall along the Mexican border, and to impose protective tariffs against the flooding of US markets by foreign goods. In other words, he mobilized the worst prejudices among those Americans that are least educated, but worst affected by the ongoing economic and financial crisis.
Trump’s election victory is very different from those of all his predecessors
Trump has thereby paved the way for a future that will change the face of the US forever. The expectations of his blue-collar voters will be bitterly disappointed after his inauguration. Disillusionment will soon turn into anger and fury, most probably erupting in the form of social violence.
It is at this point that we will see the difference between Trump and every other candidate for US presidency before him: He was the first to use his election campaign to form an extra-parliamentary movement of the middle class and the working class which is built on frustration, hatred and anger.
So, as soon as people start getting angry and taking to the streets, we will reach a point when other politicians like Hillary Clinton would have had to rely on the police and the military. Trump, however, will be able to use the influence he gained during his election campaign to direct people’s rage against minorities. By falling back on all the prejudices he fuelled for more than a year he will, for some time at least, be able to protect Wall Street and the financial industry, that is, the real culprits of the crisis, by directing people ‘s hatred against minorities, primarily against immigrants and Muslims.
It is most probably these future prospects that made Wall Street, which initially supported Hillary Clinton, turn to Donald Trump as their new favorite. Faced with looming economic and financial disaster, Trump, in the eyes of the financial industry, has turned into the man who, based on his influence over a huge extra-parliamentary movement, may keep the system running for longer than his competitors.
However, should Trump not succeed in bringing the situation under control (which in the long run is more than likely), the true ruler of the US, i.e. the omnipotent financial industry, will be left with only one option: the intervention of the military and the establishment of a dictatorship. In this case, Trump might some day be known as the last US president who came to power by way of an election.
Ernst Wolff is a free-lance journalist and the author of the book ‘Pillaging the World. The History and Politics of the IMF’, published by Tectum-Verlag, Marburg, Germany.