The billionaire oligarchy behind Trump’s possible arrest and latest banking crisis
What connects the two biggest stories dominating the news – the potential arrest of Donald Trump and the Fed’s bailout of shaky banks?
Start with multi-billionaire Peter Thiel and follow the money.
You may recall that in 2016, Thiel spoke at the Republican National Convention to make the case for why Trump should be the next President of the United States.
In the run-up to the 2022 midterm elections, Thiel donated $15 million to the Republican Ohio senatorial primary campaign of JD Vance, who alleged that the 2020 election was stolen and that Biden’s immigration policy meant “more Democrat voters in this country”. are coming.”
Thiel donated at least $10 million to the Arizona Republican Senate primary race of Blake Masters, who also claims Trump won the 2020 election and who admires Lee Kuan Yew, the authoritarian founder of modern Singapore.
Masters lost. But thanks to Thiel’s generosity, Vance is now in the US Senate.
Thiel and other wealthy self-described “libertarians” want Trump to be re-elected president in 2024. I’ll know the reason for that in a moment.
What connects Thiel to the bank bailout?
Days before the Silicon Valley bank failed, Thiel’s venture firm, Founders Fund, advised customers to withdraw their deposits. This contributed to the run on the bank.
Some $50 million of Thiel’s own money was still stuck in the bank. Then, guess what? Thiel and other wealthy depositors were bailed out by the Fed.
Accusations of hypocrisy have been leveled against Thiel and other wealthy depositors who claimed to be libertarians but were shielded by the government.
There was nothing hypocritical in this. Thiel and others like him are not really anti-government, In fact, they are protesting democracy, They prefer an oligarchy – a government controlled by super-rich people like themselves.
Thiel is part of the anti-democracy movement, of which Trump is the unofficial leader.
Their hostility to democracy comes from the same fear that the super-wealthy have always spoken about democracy – that the majority might vote to take their money. This fear is exacerbated by the fact that more and more of the country’s wealth is moving to the top, combined with demographic trends with most voters becoming less financially secure, more non-white, and politically left.
Thiel and his ilk see Trump as an authoritarian strongman who will not allow the majority to take away their wealth. In December 2017, Trump and his Republican allies in Congress laid out a plan for a massive tax cut for the super-rich and the companies they invest in. Many believe a second Trump administration backed by a Republican Congress will cut their taxes even further.
They also support the Fed. Like most of the world’s central banks, the Fed is insulated from democratic accountability, fearing that financial markets might otherwise not trust it by doing unpopular things like bailing out banks or controlling inflation by slowing the economy and causing millions to lose their jobs. do. The Fed is largely run by bankers. You could say it is part of America’s oligarchy.
A few years earlier, Thiel wrote that “I no longer believe that liberty and democracy are compatible.” Presumably he was referring to the freedom of aristocrats like himself to be unrestricted by taxes and regulations. In this narrow sense, he is right: oligarchy is incompatible with democracy. Nor is the oligarchy conducive to the freedom of the rest of us.
Thiel and others like him want to return to an era when American oligarchs had free reign. In the same essay Thiel wrote:
The 1920s was the last decade in American history during which one could be truly optimistic about politics. Since the 1920s, the vast increase in welfare beneficiaries and the expansion of suffrage to women – two constituencies notoriously hostile to liberals – have turned the notion of “capitalist democracy” into an oxymoron.
But if “capitalist democracy” has become a paradox, it is not because of excessive public assistance or because women got the right to vote. That’s because billionaire capitalists like Thiel are undermining democracy with huge campaign donations to authoritarian candidates.
I’m old enough to remember a former generation of wealthy Republicans who supported candidates like Barry Goldwater. they called themselves “conservatives” because they wanted to Protection American Institute. But Thiel and his fellow billionaires in the anti-democracy movement don’t want to preserve anything — least of all anything that came after the 1920s, including Social Security, civil rights and even women’s right to vote. (aside from the Federal Reserve’s bailout, the ability of the wealthy and average workers to prepare to fight inflation).
The 1920s marked the last gasp of the Gilded Age era, when the richest Americans siphoned off so much of the country’s wealth that the rest of America needed to maintain their standard of living and maintain aggregate demand for goods and services. Got into debt. nation produced. When that debt bubble burst in 1929, we got the Great Depression.
This was also the decade when Benito Mussolini and Adolf Hitler emerged to pose the worst threats to freedom and democracy the modern world had ever seen.