Oligarchs

 The New York Times ran a story a couple days ago about Gavin Newsom's rather surprising decision to appear on a podcast with MAGA arch-propagandist Steve Bannon. The main takeaway from the journalist's account was that the two men—despite their supposedly polar-opposite politics—ended up finding a surprising amount of common ground. They both, after all, were able to converge around the rhetoric of economic populism. 

Both men, for instance, have come to despise Elon Musk. Steve Bannon was railing at various points in the interview against "oligarchs"—and Newsom agreed with him (they only differed over which of the two parties was most responsible for creating them). Perhaps most surprisingly, Steve Bannon even put in a kind word for Lina Khan—the Biden administration FTC appointee who has been the face of the populist Left's efforts to deploy antitrust enforcement more aggressively, in order to break up big tech companies. 

Newsom's response to all this was not so much to disagree with Bannon—as to point out that all the stuff he is saying has basically nothing to do with Trump's policies. After all, Trump removed Lina Khan from her position, as Newsom observed. More broadly, Trump cannot realistically be portrayed as an economic populist. There is the policy of extending tax cuts for the ultra-rich that he is currently trying to squeeze through Congress, for instance; there is his budding bromance with various tech CEOs and corporate overlords; etc.—to take only the most conspicuous examples. 

MAGA "nationalist populists"—such as Bannon purports to be—may point to Trump's tariff policy as evidence that he is willing to defy the economic elite and pursue policies backed by a working-class constituency. But a tour through history will reveal that tariffs have actually been a tool of economic concentration more often than of economic populism. They have—broadly speaking—helped to entrench the privileges of the corporate elite and shift the tax burden onto the working class. And—indeed—Trump's current use of trade barriers is plainly helping him to cement the rule of an economic "oligarchy"—not to displace it. 

A recent podcast on the Ezra Klein show brought this fact to the fore. Klein was interviewing the economist Kimberly Clausing of the Peterson Institute about the likely effects of Trump's trade wars. And while much of the conversation focused on the obvious economic downsides of restricting global trade—they also pointed to a less-often discussed feature of these policies: namely, the way in which tariffs entrench special interests and benefit large corporations. 

Tariffs do this in at least two ways: first, by raising the costs of doing business across the board, they benefit large firms that are the best positioned to eat these costs. Tariffs therefore drive smaller companies out of business and concentrate market share in the handful of mega-corporations that remain left over. 

Secondly—and even more ominously—the tariffs also provide an engine for corruption. Because Trump can offer exemptions to individual firms from each round of tariffs, as he personally chooses—the tariffs essentially become a way for the White House to play favorites. Trump literally gets to pick economic winners and losers. As a result, he can force firms to bow to his political wishes. And he can reward the handful of companies that are most loyal to his personal power. 

Far from bringing about the reign of economic democracy, therefore—Trump's tariff policies are entrenching the power of a new economic oligarchy—made up largely of the major tech CEOs who have chosen to "bend the knee" in anticipatory obedience to Trump. 

What's more: this fact should not surprise us. Edgar Lee Masters—in his 1904 book, The New Star Chamber and Other Essays (which I've been reading this weekend)—argues that such concentration of power has always been the goal of tariffs. The "protective tariff," he argues, is a form of "indirect taxation" that shifts the burden of funding the government from the wealthy to the poor and working-class. 

For this reason—in Masters's telling—tariffs have never been associated in history with the Jeffersonian populist tradition—but always with the Hamiltonian interests of the big manufacturers and mega-corporations. 

This is just one more way of many, therefore, in which "MAGA" populism is really faux-populism. Bannon's "nationalist populism" is the opposite of the real populist tradition in American history. In Trump's concentration of executive power and his corporate cronyism, we see a continuation of the aristocratic Hamiltonian influence over our republic, not the democratic Jeffersonian tradition. Real populism in the William Jennings Bryan mode would revolt at the prospect of using tariffs to pick favorites, grant special privileges to certain firms, and entrench the rule of a handful of tech CEOs. 

So, by all means, let us converge across the political spectrum against the idea of "oligarchy." I'm glad we can all find common ground—in theory, at least—in the observation that the power of a handful of mega-corporations and tech barons is a menace to democracy. By all means, let us join forces to "scourge the elephant plutocrats" by using the tools of antitrust enforcement—to borrow a phrase from that great hymn to the real American populist tradition, Vachel Lindsay's "Bryan, Bryan, Bryan, Bryan." 

But let's be real at the same time about the fact that Trump's administration represents the opposite of what Bryan-style populism actually stood for. 

Trump is not "scourging the elephant plutocrats"—he is feeding them peanuts, stroking their trunks, and helping them to stamp all over the weak and helpless. That's the opposite of populism. Trump's policies are not a threat to the "oligarchs"—they are the biggest engine ever devised to enable them to tighten their grip on power.