Why some billionaires will support Trump

Donald Trump's campaign is said to be short of cash. Small donations are far behind their 2020 pace. Large rallies are not what are bringing in the most money. Some big-dollar donors are wary, in part because they worry (rightly) that their money will not be used for the campaign, but rather to pay the former president's legal bills. So Trump has been courting right-wing billionaires.

I have no idea to what extent he will succeed, but it seems very likely that at least some billionaires will contribute considerable sums to a man who tried to overturn the last election and who has openly stated his authoritarian intentions: to use the Department of Justice to persecute his political adversaries, rounding up millions of undocumented immigrants and putting them in detention camps, and other things like that.

Which begs the question: why would billionaires support such a person? After all, they haven't been suffering during the Biden presidency. Economists, myself included, often remind people that the stock market is not the economy. Low unemployment and rising real wages — two things, by the way, that the Biden economy has achieved, although many people don't believe it — are much more relevant to most people's lives.

But stock prices are probably a much better indicator of how the very rich, who own many financial assets, are doing. And although in 2020 Trump predicted a stock market crash if Biden won, the market has, in fact, been reaching all-time highs under the current Administration.

Why, then, support a candidate who more or less promises to unleash social and political chaos? One obvious answer is that the rich would almost certainly pay less taxes—and businesses would be less regulated—if Trump wins.

If you believe, as some on the left do, that Republicans and Democrats are basically the same thing—that they both defend the interests of corporations and the elite—you are wrong. The modern Democratic Party is not, despite what prominent Republicans say, Marxist or socialist. However, he does have a history of raising taxes on the rich to pay for social programs. In particular, the Affordable Care Act used new taxes on high incomes to pay for health coverage.

These new taxes helped increase the effective federal tax rate for the top 0.01% of the population; President Barack Obama redistributed income much more than many people believe. Trump, instead, passed a big tax cut that favored the wealthy and largely reversed the increase in his effective tax rate during the Obama era.

Biden is now proposing major tax increases on corporations and the wealthy. And he wouldn't even have to pass a law to carry out the increases: Most of the provisions of Trump's tax cut will expire at the end of next year unless Congress renews it.

But I would argue that the prospect of lower taxes should not be enough for billionaires to support Trump.

After all, how much would extra money really matter to people whose lifestyles are already incredibly lavish? My feeling from the outside is that, among the very rich, earning more money has less to do with what they can afford and more to do with prestige: earning more than others in their same group. And the thing about higher taxes is that, because they would apply to everyone, they wouldn't upset the rat race: those considered rivals would take the same hit.

And Trump's return to power would make America a scarier place, which should matter a lot more to even billionaires than a few percentage points in their tax rate.

But do you understand it? Last year, when I wrote about the fleeting infatuation of hyper-masculine tech types with Robert F. Kennedy Jr., I pointed out that the very rich tend to be less informed about what's going on in the world than many ordinary citizens, because they live in a social bubble. The danger that Trump represents to American democracy is—or should be—evident. However, it may be less obvious to people who, because of their wealth, seem to believe they know more and may surround themselves with confidants who assure them that they do know more.

Let's think about the case of Elon Musk. Do I need to say more? I also suppose that even billionaires who recognize Trump's authoritarian leanings probably imagine, if they think about it at all, that their wealth will protect them from the arbitrary exercise of power.

They should—but won't—learn from the experience of the Russian oligarchs who helped put Vladimir Putin in power. In the end they discovered that once you install a dictator, his wealth is not the shield you might have thought it was and you may find yourself sent to Siberia. And before you say it's impossible to apply this worst-case scenario thinking to the United States, keep in mind that the Trump alarmists have been mostly right and the apologists have been mostly wrong; I’m old enough to remember when Trump’s former acting chief of staff wrote, “If he loses, Trump will surrender gracefully.”

So will Trump get the support of billionaires? Probably. If he wins, will they end up regretting his choice? I think so, but by then it will be too late.

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