How Did Trump Win? Follow the Dark Money

Yves here. We are glad to see the latest research of our colleague and sometimes guest poster, political scientist Tom Ferguson, getting traction, as this Real News Network interview demonstrates.

AARON MATÉ: It’s The Real News, I’m Aaron Maté. It’s been over a year since Donald Trump pulled off what is likely the biggest upset in U.S. political history, but we have yet to fully understand how it is that a reality television host with no political experience managed to do it. The widespread perception is that it was a combination of Russian meddling and a last minute October surprise from then FBI director James Comey. Well, a new study takes a much deeper look than has been done to date and a very different picture emerges. It points to, among other things, a major last minute infusion of secretive dark money on Trump’s behalf. The study is put out by the Institute for New Economic Thinking and it’s called, “Industrial Structure and Party Competition in an Age of Hunger Games: Donald Trump and the 2016 Presidential Election.”

I’m joined by one of its three co-authors. Thomas Ferguson is professor emeritus of political science at the University of Massachusetts, Boston. Welcome Professor Ferguson. Before we get into the overlooked factors that you found, let’s look at the dominant narrative, which is that it was indeed Russian meddling and Comey that helped sway voters to turn on Clinton, who was leading in the polls, and vote for Trump. What is your though on that?

T. FERGUSON: This is the real heart of the problem with both the Comey and the Russian internet story — it’s that when you actually look at what happened, not only did Hillary dip in the polls, but at the very same time the chances of the Democrats taking the Senate collapsed. When you’ve got two collapses, not one, and they very closely tracked each other, as we show in a figure in our paper, so, what’s going on there? Well, when you look, first of all, you can take the Senate one very straightforwardly. There’s no doubt about what happened. Mitch McConnell and company were going to donors and saying, as nice articles in Bloomberg and elsewhere on this that we cite, they’re saying, “You guys can’t afford to lose both the presidency and the Senate. So, you better help us.”

They did. An enormous wave of cash came in for the Senate and the other thing we discovered when we looked was we created a day by day … Paul Jorgensen, Jie Chan and I created a day-by-day file of contributions into the Trump campaign and included dark money. You say, how do you know it’s dark money? Obviously, it’s not all provided. The answer is very straightforward. We’ll see this cash coming in from an entity, usually has kind of a fake charitable name attached, and then you will see the cash coming out but no cash going in. That’s what they’re legally allowed to do because everybody knows these are not charities. They are in fact there to do politics. And so, you can tell the dark money easily. When we look at the dark money for Trump in the final weeks we were astonished, ’cause Trump had — and there’s actually a clip of Trump saying he wouldn’t take dark money.

DONALD TRUMP: They’re raising all of this money and they’re gonna spend it on the campaign and we have … The candidates aren’t supposed to be involved in all that stuff but they have all this money going. Nobody even knows who the people are. Nobody knows where they are. Nobody knows what they’re doing with the money. It’s a whole big scam.

T. FERGUSON: Well, he had a bigger wave of dark money than Romney did in 2012. That’s what we used as comparison. We thought two Republican presidential campaigns with a lot of dough. That should be pretty fair. In that sense, the real problem with the Comey or the Russian story, just to repeat is, hey, you’ve got two waves of collapses and two big waves of money. More than likely than not what you’re seeing in both cases is the sound of money talking. It’s that simple.

AARON MATÉ: You are known for having developed the investment theory of politics, the theory that it is big business, big corporations and elites who play the most decisive role in the outcome of elections, in this case in terms of seeing Trump as an investment, how did so much money come into him if it was widely perceived that he was gonna lose?

T. FERGUSON: Well, I think I’ve made the joke elsewhere, it might be the greatest out of the money options in world history and one you could take up cheap. But seriously, the story, never mind my take, my colleagues and I have a pretty careful analysis of the money in the Trump’s campaign. And what we basically find is in the early stages he did attract a lot of individual money from small donors, and overall his campaign was remarkable. I never saw anything like it in the Republican party, unless it were maybe the Goldwater ’64 campaign — and I know that this immediately betrays that I’m as old as the Egyptians on that point. But I mean, that was full of small donors too. But I mean, normally Republican campaigns are not full of small donors. They are dominated by big donors but Trump in the early stages of the campaign was just by himself, pretty much. Financing his campaign along with this big wave of small money. In May, he’s actually telling reporters, we cite in the paper, that he doesn’t need the usual billion dollars to run.

And so, by June the campaign has a different tack. And Priebus and Manafort and these people are all out trying to raise cash and they do raise money. They raised a substantial amount around the time of the convention. That money doesn’t keep coming though, and so, by the end of July they got a fairly serious problem. When Bannon and Conway take over, then the dam breaks and we sort of show you there’s a big wave of money from casinos and especially from private equity. And if you look at private equity, those are the odd folks out on just about everything. These are people who have often personally not wonderful relations with the rest of the business community and certainly not with the business round-table types. And my suspicion is, is that they knew that Bannon — I don’t try to read minds and neither do my colleagues, but if I had to guess — I’d say they knew they didn’t like Hillary Clinton.

They knew Bannon and Conway were conservatives to their stripe, which is basically cut the stake to everything except the military expenditure down to just about nothing. And de-regulate and cut taxes, the other obvious inference there. And so, they piled in, at any rate, they did it. And the other point to make and you should remember this when anybody says its Comey and/or the Russians. It’s very obvious that the Trump campaign was very well targeted. The day after Bannon takes over, in the Washington Post there’s a — we quote it — there’s an article that just says, they will now concentrate on a few industrial states where they think they can actually win over voters, poor, poorer voters, and they did that. And whereas, famously the Clinton campaign was campaigning all over the place in places that probably didn’t matter.

AARON MATÉ: Well, you know what? Professor on that point, let me say — and by the way in terms of investment, investor confidence in the Trump campaign, I’m sure was boosted when Robert Mercer, the hedge-fund billionaire, he was the one who brought in Kellyanne Conway and Steve Bannon, essentially,

T. FERGUSON: Careful, it was following a conversation between Rebekah, his daughter, and Trump. And there’s no reason to think there probably weren’t some other contacts there but that’s the one that’s been heavily written up.

AARON MATÉ: Right. So, the Mercer family endorses, essentially, the Trump campaign and brings in its people, Bannon and Conway and after that is when you have the rise in dark money that you tracked. But let me ask you about in terms of messaging, you have Trump meanwhile trying to appeal to working-class voters in a way that Clinton did not. And as a sample of that, this is Trump speaking in Pennsylvania in June 2016.

DONALD TRUMP: Globalization has made the financial elite who donate to politicians very, very wealthy. I used to be one of them. Hate to say it but I used to be one. But it’s left millions of our workers with nothing but poverty and heartache. When subsidized foreign steel is dumped into our markets, threatening our factories, the politicians have proven, folks, have proven: they do nothing. For years, they watched on the sidelines as our jobs vanished and our communities were plunged into depression-level unemployment.

AARON MATÉ: So, that’s Donald Trump, then candidate Trump, speaking in Pennsylvania in June 2016. Now, along with Pennsylvania, Trump also won the key battleground states of Wisconsin and Michigan. And Professor Ferguson you point out, and this is a factor that has not gotten any attention, is that these three states were all targets of major anti-union drives before the campaign.

T. FERGUSON: Targets of cesspool anti-union drives meaning that they show, I think, in the top eight states a loss of the union members under the Obama administration. When they’re in power. 2009 to ’16. They’re right in that very highest levels and if you do simple math … The margin in those states is something 70,000 votes sometimes, or fewer. And you gotta wonder if the union rights had just been the same, knowing the rate at which unionized workers vote Democratic rather than un-unionized workers, it would have been a different race perhaps. I mean, there’s a lot of other … It’s a hard call, ’cause there’s a lot of other things that weren’t constant too, but that does seem to be quite striking.

And more broadly, I have to tell you that whenever I hear Democratic Party politicians talking about bringing back the Democratic Party, making a big fight in states and local areas … the truth of the matter is that for much of the United States where there’s a Democratic Party, if you have no unions you have not much of a Democratic Party unless it’s built on some ethnic organization, some of the Hispanic organizations in Texas or something like that. And I mean, there’s an awful lot of self-deception in the discussions about rebuilding the Democratic party. It can’t be done, I suspect, in any normal Midwestern, northeastern state while unions continue to just bleed members. It’s just not gonna happen. It’s like a round square.

AARON MATÉ: Well, that is a good segue to the next part of our discussion where we’re gonna talk about the other unusual feature of the 2016 campaign, which was the extraordinary success of Bernie Sanders despite unanimous corporate opposition. The study is called, “Industrial Structure and Party Competition in an Age of Hunger Games: Donald Trump and The 2016 Presidential Election.” My guest is Thomas Ferguson, professor emeritus of political science at the University of Massachusetts, Boston. Professor Ferguson thank you.

T. FERGUSON: Thank you.

AARON MATÉ: And thank you for joining us on The Real News.

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18 comments

  1. Altandmain

    To be honest at this point, the US is a plutocracy pretending to be a democratic society.

    Both parties are responsible for the damage of the US living standards. To fight the Republicans and Trump, there is also the matter that the Democratic Establishment has to be taken on first. They both are in bed with dark money. Basically the ultra rich run the show.

    The illusion of the whole charade has begun to wear off on a critical mass of people, which is why we are seeing the current situation. There are still those who believe that the status quo is alright. That is especially important for the upper 10 percent of the population that make up the wealthy upper middle class. It is a club that you are probably not invited to.

    Reply
  2. sd

    Does dark money actually vote? People vote. Angry people, excited people, frustrated people, motivated people vote. I know I personally was motivated to vote for anyone other than Clinton. This article is less about dark money than it is more about Labor.

    Democrats ignored the working class – in particular, unions – while Obama was in office. Hilary went on to ignore Labor even going so far as to actively campaign against $15/hour minimum wage (seriously think about that for a moment) 2016, the Democrats lose the White House.

    I don’t doubt there was dark money in large quantities on both sides and that it influenced voters. In the end, Hilary Clinton was a candidate who was so horrible, she needed her friends to rig the game in her favor. How bad do you have to be that your supporters feel the need to hand you debate questions in advance? Good lord.

    At this point, my concern is the allure of the catch phrase ‘dark money’ is going to become just yet another excuse for the DNC to ingore Labor. Just watch, they will rollout a fundraising campaign to ‘defeat’ Dark Money.

    Reply
    1. sgt_doom

      Outstanding, logical and most importantly, most truthful points — ignored by just too many Ameritards today, who live to remain oblivious to anything of importance!

      DNC is clearly doubling down on their past failed strategies, and will continue to ignore the dramatic increase in state legislatures across the country going red.

      Really scary . . . 2016 should have been the year of the third party, instead Americans were presented with two Wall Street thugs to choose from (Clinton and Trump).

      Reply
  3. Darthbobber

    He makes some good points, and he hardly absolves the democrats for their own unforced errors, but.

    1) Do only republicans spend dark money? And if not, what was the relative breakdown of its use in attacking the presidential and senatorial candidates of the respective parties? In the realm of open money we know that the Clinton advantage was huge.

    2. The bulk of dark money seems to go into mass media, and when you hit that couple month stretch of 24/7 attack ads on all available tv, radio and social media the point of diminishing returns comes pretty quickly as it all blurs into a cacophony of white noise.

    3. Its one thing if one side is filling the airwaves with attacks and the other has nothing at all with which to respond. (eg last year’s Montana house election where team donkey left their guy broke for the first several months while the attacks came constantly.)

    This was certainly not the case in Pennsylvania, where neither Clinton nor McGinty lacked at all for seemingly bottomless piles of cash.
    .
    Pat Toomey remains senator because Obama and Clinton Pearl Harbored Joe Sestak and secured the nomination for the utterly lackluster McGinty, against whom the attack ads practically wrote themselves. (For that matter, the reason we were saddled with Toomey in the first place was their efforts to saddle us with Arlen in 2010, but thats another story.)
    .
    The cash piles no doubt helped some republicans, but they could have been overcome by about any campaign other than the one I saw.

    Reply
  4. The Rev Kev

    “a big wave of money from casinos”

    That sounded like Sheldon Adelson money. In checking back I founded that Trump was actually promised $100 million by him alone back about May of 2016. I guess that a deal was struck to support Trump if Trump supported Israel wholeheartedly. Promising to move the US Embassy to Jerusalem may be paying back this debt.
    Hard to say if any of this money was sourced by Netanyahu’s colleagues indirectly but it may be more of a case where the US gives Israel billions in both military aid and foreign aid each year and this is some of that money making its way back home.

    Reply
    1. readerOfTeaLeaves

      And add in who was Finance Chair of the RNC? Steve Wynn.
      And where was Steve Wynn heavily investing? Macau.
      And who else was investing? Private equity.

      If it is true that 35% of US stocks are owned by non-US entities, then is it the case that the GOP tax cut bonanza basically accelerated transfer of US-based wealth to overseas investors? Am I missing something here….?
      And if hedge funds are a great way to ‘invest’ in not only companies, but politics, they seem to be squaring the circle.

      One reason that Bernie was so extraordinary was his emphasis on getting $$$ (by which, at this point, I mean rubles, yuan, rials, euros, yen, and heaven only knows what else) out of American politics. Too many people think that Bernie was saying, “Get the ‘dollars’ out of politics”, but IMVHO that is a hopelessly naive view of things.

      Why the Dems can’t do enough research to argue that Trump is ‘the best president global casinos and hedge funds can buy’ is testament to their ineptitude at this point.

      Reply
  5. Anon

    A great article, but with something as complex as 2016, can you really pin it to only one factor, especially one as vague as “dark money”? I mean, even without this “dark money” being mentioned, I’d say that his command of the airwaves and the sheer monopolization of coverage played a bigger factor than some cash infusion.

    Reply
    1. False Solace

      Sorry but “dark money” is not a vague term, it has a clearly defined meaning and has been in use since the 70s.

      Dark money is money donated to non-profit organizations, which are not required to disclose their contributors, in order to influence elections. It’s used to get around campaign contribution limits and disclosure laws.

      Wikipedia has a nice table comparing dark money to Super PACs: https://en.wikipedia.org/wiki/Dark_money#Comparison_to_(and_relationship_with)_super_PACs

      Reply
  6. Steven

    altandmain and sd pretty much spell it out. I have several friends who are just about as ‘red’ (as in right wing, conservative or whatever you want to call them). But they are still able to think. And without exception they said they would have voted for Bernie rather than Trump if given the chance. The depths to which the wholly owned – by Wall Street and the Saudis – Democratic Party will sink rather than cleanse itself of its Clinton, neo-liberal, globalist corruption are revealed with all the Russia-gate bullshit.

    So, Democrats. Clean house or count me out!!!

    Reply
  7. Tomonthebeach

    Big and sleazy money only matters when voters have to chose between the lesser of two evils.

    I cannot shake the feeling that if better candidates were fielded this story would be irrelevant. Sanders showed that big money is not relevant if you have the ear of the people. The DNC does not, and neither does the RNC. Thus, both depend on dark? BLACK money.

    It is only in the Mad Magazine type of situation in which Spy v Spy – or Bad vs Worse – that money (dark or just plain evil) is likely to make a difference. If you look at ads the money paid for, it was not to promote the candidates’ platforms; but to pillory Hillary – or to thump Trump. It was money spent to make the favored candidate the lesser of two evils. It worked.

    Reply
  8. Synoia

    All these thins are excuses, after the fact.

    Noting will change that:

    Hillary was a poisonous candidate, the Democrats turned their backs on workers and unions, and Obama neglected the D party apparatus.

    Reply
  9. Jer Bear

    “… the other unusual feature of the 2016 campaign, which was the extraordinary success of Bernie Sanders despite unanimous corporate opposition.”

    this is THE story of the 2016 campaign.

    Reply
    1. Tony Wright

      But surely, and sadly, Bernie will be too old for 2020. So who can the Dems put up then who can both resist the machine and inspire change hungry voters as Bernie did in 2016? As a non – American there does not appear to be anyone on the horizon despite that I follow world affairs pretty closely. And what the US does is hugely important to the rest of the world – progress on climate change and renewable energy policy, trade and the economy, and social issues are all greatly influenced worldwide by what happens in the US.
      So any ideas anybody as to a talented, progressive Dem candidate, or do you really need to subvert the political paradigm (again!) and go all in with an independent?

      Reply
      1. sgt_doom

        That would be Tulsi Gabbard, I believe . . .

        And no, Elizabeth Warren endorsed HRC, just as years previously she voted Reagan and Bush.

        ‘Nuff said . . .

        Reply
  10. Barni

    Trump wants to take down the Wall Street banksters et al, but before he can do that he must clean out the legions of paid off ‘deep state’ minions and let the evil deeds of the Wall Street paid off Congress critters, pursued by Trump and his loyal patriots, put them in jail. Meanwhile Trump is putting the Wall Street banksters to sleep by easily reversed policies etc. which keep them at bay while he empties Washington of their O/O ‘deep state’. Once their ‘deep state’ minions are removed the banksters will have little or no ability to mess up Trump’s legislative agenda or use the departed ‘deep state’ minions as bureaucratic quick sand to virtually stall Trump’s agenda to death – and America can become a great democracy again!

    Meanwhile the paid off (O/O by Wall Street banksters) and deeply deluded corporate MSM is 24/7 ad hominem slandering Trump and his family.
    The Wall Street banksters have created a 24/7 wall of false and slanderous accusations against Trump. The Wall Street O/O MSM is getting a hernia creating bigger and more and more copious phony Trump pseudo-news which has invaded not just all media news but virtually all media programming.
    Lincoln and Kennedy took on these slimy banksters and the banksters took them out. Trump will be a lot more difficult to take out than Lincoln or Kennedy.

    Cleaning out the corruption and rot from the federal government is dangerous and there are many unsolved mysterious murders in Washington of individuals who could have revealed the corruption, the corrupted and the corrupters. Say a prayer for President Trump – he may be the last and only chance to save American democracy and the Union from the Wall Street banksters and their political, deep state, and media minions.

    Reply

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