Oh the irony! In a May 5, 2016 article featured in Politico, the corporate elite declared that they will not open their checkbooks for Trump, and for good reason. Koch Brothers, among other mega donors, are turned off by Trump’s aggressive campaign strategy which includes mudslinging and personally attacking his opponents on social media.
The irony of the situation is that the Koch Brothers worked with the tobacco industry to create an anti-government movement, which now is largely the support base of the Trump presidential campaign. You may have heard of it, it’s the Tea Party (see Amanda Fallin-Bennett paper ‘To quarterback behind the scenes, third-party efforts’: the tobacco industry and the Tea Party, and the book Poison Tea by Jeff Nesbit for further information). The billionaires and their political puppets (Rubio and Cruz) that helped manifest the Tea Party through third party efforts and corporate-funded front groups, no longer have control over how party loyalists vote or who they support.
Many of Trump’s supporters identify as Tea Party loyalists because of his xenophobic speeches and campaign promises that he will force other nations to pay their fair share of tariffs to the US.
Not that this should come to anyone’s surprise as Trump is not trained in international political economy or political theory, but he has no idea what he is talking about when he makes claims on balancing the terms of trade through protectionist economic policies and high tariffs. One has to question: what countries is he actually talking about anyway? It cannot be the former colonies.
High tariffs will not solve the US’s problem of widespread inequality. In Raul Prebisch’s theory on declining terms of trade, he divides the world into two, the North, consisting of colonial powers and the imperialist USA, and the Global South, which includes former colonies and Latin America (note: I prefer other terms than these but they are the ones used in international political economy).
Prebisch’s argument states that although independent, in the international economic system, the former colonies entered into an agreement with their colonizers and the imperialist power, the United States, with a distinct disadvantage given that the declining terms of trade, which increases over time and leads to higher rates of poverty. Former colonies produce raw materials or primary goods, which has a value in the global market far less than manufactured goods and international financial services (United States’ primary export, which increasingly has replaced the production of manufactured goods and the working-class jobs that manufacturing industries supplied, and is arguably a cause, among many, of growing inequality). This situation prevents the former colonies from developing economically in a way that would be competitive in the international system, both economically and politically speaking. International institutions such as the International Monetary Fund and the World Bank are controlled by the US and European countries because they are able to pay more into them, thus granting them more decision-making power.
Although Latin America has been “free” from colonial rule since the early 19th century, the region was not truly granted independence As Saccarelli and Varadarajan state in their book Imperialism: Past, Present and Future:
“[Latin American countries] had become intimately acquainted with the notion that the end of colonial rule did not necessarily spell genuine independence.”
Interventions to redistribute wealth through protectionist policies is another subject of debate and outside the realm of this blog post. For more information, read Prebisch’s thesis on import-substitution industrialization as a solution, and how ISI policies failed because of political corruption which redistributed wealth to the national bourgeoisie rather than advance economic development.
Another ironic point, which I alluded to in previous paragraphs, is that the anti-BIG government “Tea Party” movement has been framed in a way that blamed the federal government for economic inequality, rather than the corporate elite, who let’s face it, has a goal to increase their wealth through policies and tax structures that ultimately concentrate wealth in the hands of the few. Economic insecurity and job loss is a result of globalization and so-called “ultra market fundamentalism”, in which corporations have been offshoring what was left of the few blue collar jobs in the US for decades. To reduce labors costs, MNCs export jobs to low income countries with the overall goal to increase profits and satisfy shareholders.
It will be interesting to see if the Koch Brothers support Hillary Clinton so as to avoid Trump in the Oval Office.
Voters, including those that support the so-called anti-government candidates, who use such rhetoric to advance an agenda for corporate welfare policies to benefit the rich off of the backs of the middle class, need to understand the role that the Koch Brothers played in creating and funding the Tea Party movement. Their goal was to deflect attraction away from a larger business strategy to become two of the most wealthiest people in the world through privatization of social programs, corporate tax cuts, and deregulation (aka the Washington Consensus) and to spread economic inequality both domestically and worldwide.