by From Jamie Morgan and RWER no. 78 As a brand, Trump is also a particular kind of contemporary businessman. He positions himself as a maker of “deals” rather than a maker of things, though his wealth is rooted in construction and property. He is an owner of portfolio assets, who uses these to leverage new ventures where he is able to conjure personal gain from situations where material benefits to the many may be lacking. His skill set is one of concentration and extraction of returns, and the externalisation of costs and losses. Based on that skill set profits can artfully appear and equally disappear (with tax consequences) in ways that have little to do with the simplistic concepts of theory of the firm. The solution to any problem is an additional incorporation, a transfer of assets, a lawsuit that deters others, a no fault out-of-court settlement that protects oneself, a debt restructure or perhaps a timely Chapter 11 bankruptcy declaration. Being proficient along these lines can make one a billionaire, particularly if one starts with a core of inherited wealth for collateral and has access to a network.[1] Ultimately, the returns are achieved by surrounding oneself with people able to understand and exploit rules and seize an opportunity.[2] The ex post justification for this is that no one prevented it and “wouldn’t you do it too?”.
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from Jamie Morgan and RWER no. 78
As a brand, Trump is also a particular kind of contemporary businessman. He positions himself as a maker of “deals” rather than a maker of things, though his wealth is rooted in construction and property. He is an owner of portfolio assets, who uses these to leverage new ventures where he is able to conjure personal gain from situations where material benefits to the many may be lacking. His skill set is one of concentration and extraction of returns, and the externalisation of costs and losses. Based on that skill set profits can artfully appear and equally disappear (with tax consequences) in ways that have little to do with the simplistic concepts of theory of the firm. The solution to any problem is an additional incorporation, a
transfer of assets, a lawsuit that deters others, a no fault out-of-court settlement that protects oneself, a debt restructure or perhaps a timely Chapter 11 bankruptcy declaration. Being proficient along these lines can make one a billionaire, particularly if one starts with a core of inherited wealth for collateral and has access to a network.[1]
Ultimately, the returns are achieved by surrounding oneself with people able to understand and exploit rules and seize an opportunity.[2] The ex post justification for this is that no one prevented it and “wouldn’t you do it too?”. This is important, because Donald Trump is the first US President to have no experience of political or military office. But he does have experience. His experience is of how to shape and exploit law and convention to achieve goals available only to a narrow interest group. Knowing how to do this does not mean he either knows how to prevent others or is in fact intent on preventing others from doing what he has made a career of. To prevent others would be to deny his own status as entrepreneur and so deny the US the value of such entrepreneurship. Moreover, his business skill set does not simply translate, mirror or reverse. It is not a simple case of poacher turned gamekeeper. For example, being “smart” enough to employ lawyers who can spot a loophole does not enable one to construct law without loopholes (if it did then the general problem would have been solved long ago).[3] In any case, concentration and extraction of returns is quite a different frame of reference than the construction of an overall economy. Developing Trump’s skill set created a social subject, some might say anti-social subject. Political economy, meanwhile, is concerned with how we choose to live. But Trump already has a default position. He is by socialisation a particular personification of powerful special interests (capital mobilizing dealmakers). His own sense of uniqueness and superiority should not obscure this nor should it obscure the underlying logic it rests on, which is what is good for this interest group is good for the US economy. This is a deep ambiguity in Trump’s appeal once one moves beyond the showmanship. read more
[1] Trump’s narrative is that he began with a loan from his father. It has also been pointed out Trump could have been as wealthy simply through passive investment. This is arguable and would depend on exactly what Trump is worth, which is difficult to ascertain.[2] Beginning notoriously with Roy Cohn.
[3] One can close loopholes and create law that closes down opportunities existent under former law, but it is the interest in and attitude to exploitation that remains, unless relevant kinds of organization or practice are prohibited. Trump has shown no interest in eradicating the category of “entrepreneur” of which he is a member.