Matt Taibbi discusses his book at Politics & Prose bookstore in Washington, D.C. This event was recorded on April 21, 2014.
Andrea Bernstein is a senior editor at WNYC and co-host of the “Trump, Inc.” podcast. A Peabody and duPont-Columbia award-winning journalist, Bernstein’s new work is an exposé on two families at the pinnacle of American power. American Oligarchs: The Kushners, the Trumps, and the Marriage of Money and Power, is Bernstein’s investigative journey into two emblematic American families—the Kushners and the Trumps.
Jared Kushner and Ivanka Trump enjoy limitless access to the Oval Office, but beyond their marriage, little about the families’ relationship is public knowledge. Throughout American Oligarchs, Bernstein reveals their campaign into the White House by tracing history stretching from the Gilded Age to WWII to the 21st century. Bernstein draws on private interviews, never-before-seen documents and forgotten files in order to expose the families’ accumulated wealth through real estate, manipulation and crime.
Bernstein’s American Oligarchs is a serious examination of the half-truths, secrecy and media manipulation weaponized by the Trumps and the Kushners. Join us as she discusses the Trumps, Kushners, and the marriage of money and power.
Matt Taibbi discusses his book at Politics & Prose bookstore in Washington, D.C. This event was recorded on April 21, 2014.
The Russia scandal is about more than collusion. It’s also about the corruption of America’s elites.
As seemingly every national political figure not already hopelessly in the tank for President Trump rushed Monday to denounce his disastrous press conference with Russian despot Vladimir Putin, few condemnations received as much attention as this one from former CIA Director John Brennan:
Donald Trump’s press conference performance in Helsinki rises to & exceeds the threshold of “high crimes & misdemeanors.” It was nothing short of treasonous. Not only were Trump’s comments imbecilic, he is wholly in the pocket of Putin. Republican Patriots: Where are you???133K people are talking about this
I don’t know why Trump and his team accepted, and at times actively solicited, the help of Putin and Russian intelligence in winning the 2016 election, and why they have appeared at times to actively serve Putin’s interests once in office. Maybe they were just taking whatever help they could get; maybe the pee tape is real; maybe Jon Chait’s theory is right and Trump has been a Soviet/Russian asset for three decades.
But I think I know why Trump thought it was okay to do what he did — why he could get away with it. The reason is a culture of elite impunity, where business and political leaders face absolutely no accountability for misdeeds. And it’s a culture that Brennan and many political elites like him have fostered, and from which they have personally benefited.
It’s much bigger than collusion. It encompasses many decades during which political officials have evaded accountability for broken laws and illicit foreign contacts, and business and corporate elites have skirted punishment for outright fraud. It’s a problem that, ironically, Trump hammered home in the campaign: that there’s a different set of rules for elites than for normal people. It just happens that Trump knows that because he, for decades now, has been taking advantage of elite impunity.
And unless critics are willing to target the problem of impunity, a problem in which some of them may be implicated, stuff like the Russia scandal will just keep happening, again and again.
The culture of impunity
We don’t punish white-collar criminals in this country. Not really, and certainly not by comparison to how we punish poorer, less white people for less severe offenses.
Only one Wall Street executive ever served jail time for the financial crisis. Rampant foreclosure fraud during the crisis, in which mortgage companies illegally forced millions of families from their homes on the basis of false evidence, went largely unpunished. Lanny Breuer, President Obama’s assistant attorney general for the criminal division of the Department of Justice, was so notoriously lax that Obama’s White House counsel Kathy Ruemmler once jokingly asked him, “How many cases are you dismissing this week?”
And no one knows how easy it is to get away with complicated financial crimes better than Donald Trump. For decades, he was able to dodge any consequences for his routine collaborations with the Mafia, even though his relationship with (to give just one example among many) the mob-linked union official John Cody prompted the FBI to subpoena Trump. His real estate businesses are routinely entangled with corrupt officials abroad, with the Trump International Hotel and Tower Baku in Azerbaijan and the Trump office towers in India looking particularly fishy. (Under the Foreign Corrupt Practices Act, even unknowingly profiting from corrupt activities in a foreign country is a federal crime.)
And the people around him have similarly checkered histories. His longtime personal attorney Michael Cohen is, of course, currently under federal investigation from the US Attorney’s Office for the Southern District of New York and has been linked to various insurance fraud schemes, including one involving recent Russian immigrants falsely claiming they were hit by cars. Ivanka and Donald Trump Jr. were nearly charged with fraud for their conduct in marketing the Trump SoHo hotel and condo development in 2012.
Jared Kushner is facing lawsuits for his role as a slumlord in the Baltimore area and for overcharging rent from his New York City tenants; we know that his company falsified rent control paperwork in New York. Kushner stands out among Trump’s associates in that his father is the rare person actually prosecuted for and convicted of serious financial crimes, which doesn’t seem to have made the younger Kushner any more cautious. If anything, it appears to have made him more committed to the family trade.
Donald Trump, Ivanka, Don Jr., Cohen, and Kushner aren’t under criminal indictment just yet. (Of course, Paul Manafort, Trump’s former campaign chair, is, and for serious financial crimes that are so far largely unrelated to his work for Trump.) Maybe it’s all just a series of awful coincidences. Or maybe they have correctly perceived that you can get away with truly massive white-collar crimes, and have lived their lives accordingly.
Political crimes are basically never punished, even with a body count
This same culture exists, perhaps to an even greater degree, for political wrongdoing. The Russia scandal should have, but largely hasn’t, reminded us that a presidential candidate has collaborated with a foreign government against the American government before, and gotten away with it.
In the summer of 1968, as biographer John A. Farrell has demonstrated, Republican nominee Richard Nixon and his aides actively sabotaged efforts by Lyndon Johnson’s administration to negotiate an end to the Vietnam War. They got away with it, prolonging a war that wound up killing more than a million people in the process. It’s barely even on the list of Nixonian wrongdoing that people remember. Henry Kissinger was at the time a Johnson adviser leaking information for Nixon to use in his efforts. Today he remains a broadly respected elder statesman, even in Democratic administrations.
It wasn’t even two decades later that the next Republican administration conspired with a foreign government, namely Iran’s. This time, the actions weren’t just horrendously immoral but illegal as well; elongating the Vietnam War was, alas, not a crime, but funding the Contras with Iranian arms deal money was. So was lying to Congress about it. Fourteen members of Reagan’s administration were indicted, and 11 were convicted.
It didn’t matter. Before leaving office, President George H.W. Bush pardoned six people involved, all high-ranking policy officials like Secretary of Defense Caspar Weinberger, National Security Adviser Robert McFarlane, Assistant Secretary of State Elliott Abrams, and CIA covert ops director Clair George. National Security Council official Oliver North and National Security Adviser John Poindexter had, at that point, already gotten their convictions tossed out, not because they were innocent but due to a complication resulting from Congress giving them immunity to testify.
Lawrence Walsh, appointed independent counsel to investigate Iran-Contra, would later write, “What set Iran-Contra apart from previous political scandals was the fact that a cover-up engineered in the White House of one president and completed by his successor prevented the rule of law from being applied to the perpetrators of criminal activity of constitutional dimension.”
And because the rule of law wasn’t applied, many of the perpetrators remain members in good standing of Washington’s foreign policy establishment. Poindexter returned to government to run the George W. Bush administration’s Information Awareness Office and “Total Information Awareness” program, leaving after a public controversy around a betting market he wanted to create where bettors would’ve profited if a terrorist strike occurred. Abrams, whose far worse transgressions in the Reagan years involved his support for El Salvador’s brutal military dictatorship and his efforts to cover up the El Mozote massacre, worked as a senior National Security Council official for the entirety of the George W. Bush administration.
In that administration, of course, dozens of policymakers collaborated to systematically violate US and international law forbidding torture. While low-ranking Army soldiers and officers were court-martialed in certain cases, like Abu Ghraib, the people ultimately responsible for the policy regime got away with it. John Yoo and Jay Bybee, who put together memos authorizing systematic torture of detainees without trial, escaped all prosecution. Yoo is a tenured professor at UC Berkeley. Bybee is a federal judge with life tenure.
The Obama administration not only declined to prosecute CIA officials who tortured detainees in accordance with the torture memos but failed to prosecute them even in numerous cases where those guidelines were exceeded. As Vox’s Andrew Prokop explained in 2014, the Justice Department didn’t even bother to bring charges in the cases of Gul Rahman and Manadel al-Jamadi, who were literally tortured to death.
Nor did they bring any charges against Jose Rodriguez, who authorized the destruction of 92 tapes showing the CIA torturing detainees, or against anyone who assisted Rodriguez. Gina Haspel, who Rodriguez has said drafted the order to destroy the tapes, and who ran a CIA black site for torture in Thailand, is now the director of the CIA.
Impunity means we will only get more wrongdoing
With that history — with such a clear record that neither businesspeople engaged in systematic financial wrongdoing nor political officials involved in criminal activity and illicit deals with foreign powers will ever face any consequences — why on earth wouldn’t someone like Trump, a man who lacks any willingness to sacrifice his self-interest in order to do the right thing, work with Russia? Why wouldn’t he feel okay asking Russia to hack Hillary Clinton’s emails? Why would Donald Trump Jr. have any reservations at all about accepting help from the Russian government, declaring, “If it’s what you say I love it”? People like them, in their shoes, have done the same or worse before and gotten away with it. Kissinger even got a Nobel Prize.
The obvious rebuttal here is that the Trumps are different. They’re distinctly immoral, uniquely willing to fly in the face of decency and patriotic duty and basic morality to make money and gain power. They don’t need a culture of impunity to do horrible things. To which I’d respond: yes, obviously. That’s who they are. But there will always be people like that, and there will be more as long as we maintain a system that gives them total immunity from criminal or even professional consequences for their actions.
Donald Trump Jr. himself, in his typical “say the loud part quiet and the quiet part loud” way, laid all this out pretty clearly in an interview with the Senate Judiciary Committee. “What about the thing that says, ‘It is part of Russia and its government’s support for Mr. Trump,’” Heather Sawyer, a Democratic counsel for the committee, asked him. “Did you also love that?”
“I don’t know,” Donald Jr. replied. “I don’t recall.”
“Did you understand that that would be problematic?” Sawyer pressed. Trump answered: “I didn’t think that listening to someone with information relevant to the fitness and character of a presidential candidate would be an issue, no.”
Donald Jr. was coached meticulously before that hearing, so it’s hard to read too much into what he’s saying. But I believe him. I believe he genuinely didn’t think that collaborating with the Russian government to get his father elected would be an issue.
That’s what impunity means: It means not thinking that grievous wrongdoing will one day be an issue. It helps explain why even decorated civil servants like John Brennan at best remained silent about, and at worst participated in, the CIA’s torture regime. It wasn’t an issue for him, ultimately; he eventually became director, where he could defend torturers at greater length.
But that’s exactly the problem. It should be an issue. We’ve set up a system where the baseline assumption is that nothing short of, I don’t know, full-on in-person murder can disqualify an elite political or business figure from their posting. And that means that people like the Trumps will continue to believe that criminality and collusion are just fine. Unless we’re willing to break down that system, and interrogate the role that even Trump’s enemies have played in building it, we will get two, three, many Trumps in the future.
Correction: I initially wrote that Jon Chait believes Trump has been an Russian “agent” for three decades. In fact, Chait believes that Trump “might” have been a Russian “asset” for three decades. I regret the error.
America produced a corrupt president. We can do better.
.. Elijah Cummings, the Oversight Committee chairman, pined for a return to a pre-Trump America. “We have got to get back to normal,” he said.
But Normal America produced Donald Trump, fueled his cult of personality and created the conditions for him to rise to the height of political power. If anything, Michael Cohen’s testimony was a devastating indictment of decisions that Normal America made over the past few decades that produced President Trump in 2016.
Most of the charges — proven or alleged — against those caught up in the Mueller investigation are not obviously related to treasonous collusion with Moscow. It’s proof, the president’s blinkered backers bray, that the whole inquiry is a waste of time.
Read another way, that set of facts shows how decades of declining prosecutions of white-collar crimes may have allowed Paul Manafort, a man guilty of tax evasion and bank fraud, to lead a presidential campaign. If the number of white-collar crimes prosecuted by the Justice Department had not fallen more than 40 percent in the past 20 years, perhaps Mr. Cohen, who committed tax fraud and bank fraud, might not have ascended to become deputy finance chairman of the Republican National Committee, a post he held until June 2018.
Then there’s the president himself, Exhibit A of what happens when a country spends decades treating crimes by the poor as felonies and crimes by the powerful as misdemeanors.
At the start of Mr. Trump’s career, he and his father were charged with discriminating against African-Americans in their apartment rentals. Father and son settled with the government and admitted no wrongdoing.
Later in life, Mr. Trump’s casino was charged with money laundering and got off with a fine. Just after Mr. Trump was elected, his cardboard castle of a university that bore his name settled a class-action lawsuit brought by from former students.
It took a shoe-leather investigation by The Washington Post to prompt authorities to assess that the Trump Foundation, founded in 1987, was being used as the family A.T.M. The New York State attorney general charged the foundation with “improper and extensive political activity, repeated and willful self-dealing transactions, and failure to follow basic fiduciary obligations or to implement even elementary corporate formalities required by law.” Imagine if the foundation had been scrutinized years before Mr. Trump ran for president.
Democrats, paging through the catalog of legal malfeasance connected to the president, worry that investigating too many of them will make the party vulnerable to claims of overreach. But exuberance in defense of justice is no vice, so as long as they don’t go full #Benghazi. After all, accountability has been in short supply of late.
The crimes of Paul Manafort and Michael Cohen are notable not just for how blatant they were but also for their lack of sophistication. The two men did little to hide their lying to banks and the Internal Revenue Service. One can almost sympathize with them: If it wasn’t for their decision to attach themselves to the most unlikely president in modern history, there’s every reason to think they might still be working their frauds today.
- .. Are there legions of K Street big shots working for foreign despots and parking their riches in Cypriot bank accounts to avoid the I.R.S.?
- Are many political campaigns walking felonies waiting to be exposed?
- What about the world of luxury residential building in which Mr. Cohen plied his trade with the Trump Organization?
.. The answer is more disturbing than the questions: We don’t know. We don’t know because the cops aren’t on the beat. Resources have been stripped from white-collar enforcement.
.. The F.B.I. shifted agents to work on international terror in the wake of Sept. 11. White-collar cases made up about one-tenth of the Justice Department’s cases in recent years, compared with one-fifth in the early 1990s
The I.R.S.’s criminal enforcement capabilities have been decimated by years of budget cuts and attrition.
The Federal Election Commission is a toothless organization that is widely flouted.
.. How could they not? Any person in any bar in America can tell you who was held accountable for the biggest financial crisis since the Great Depression, which peaked 10 years ago next month: No one. No top officer from any major bank went to prison.
.. The Department of Justice — in Democratic as well as Republican administrations — has lost the will and ability to prosecute top executives across corporate America, at large industrial firms, tech giants, retailers, drugmakers and so on. Instead the Department of Justice reaches settlements with corporations, which pay in dollars instead of the liberty of their top officers and directors.
.. Robert Mueller, the special counsel, has fallen upon a rash of other crimes. In doing so, he has exposed how widespread and serious our white-collar-fraud problem really is, and how lax enforcement has been for years.
.. The Southern District of New York, to which Mr. Mueller referred the Cohen case, raided the offices of Mr. Cohen, President Trump’s former attorney, and fought for access to the materials, even as Mr. Cohen asserted attorney-client privilege. When federal prosecutors investigate large companies, out of custom and deference they rarely use such aggressive tactics. They place few wiretaps, conduct almost no undercover operations and do almost no raids. Instead government attorneys reach carefully negotiated agreements about which documents they can review, the product of many hours of discussion with high-powered law firms
.. The government has essentially privatized corporate law enforcement. The government effectively outsources the investigations to the companies themselves. The companies, typically trying to appear cooperative or to forestall government action, hire law firms to do internal investigations. Imagine if Mr. Mueller relied on Mr. Trump to investigate whether he colluded with the Russians or violated any other laws, and Mr. Trump hired Rudy Giuliani’s firm to do the inquiry.
.. Mr. Mueller isn’t looking to go soft to preserve his professional viability. I’m assuming that at age 74, he’s not going to go through the revolving door after this. That hasn’t been true for most top Justice Department officials in recent years. Many of them start out defending large corporations, and when they leave government they go back to the same work of defending large corporations.
One possible lesson of the many brazen, conspicuous scandals related to President Trump and others in his orbit: The U.S. government has been massively underinvesting in enforcement and prosecution of white-collar crime.
.. There was the apparent treatment of the Trump Foundation as a personal checkbook, from which Trump used other people’s charitable donations to settle his for-profit businesses’ legal disputes and to purchase gigantic portraits of himself. The operation of Eric Trump’s personal foundation also has raised similar questions of self-dealing, according to Forbes.
.. Or there’s the fishy stock trades by Trump cronies, including Carl Icahn and even the current commerce secretary, Wilbur Ross. Ross shorted the stock of a Kremlin-linked company days after he learned journalists were reporting a potentially negative story about the firm.
Or former national security adviser Michael Flynn’s failure to register as a foreign agent working on behalf of Turkey.
There’s a clear reason so many Trump-related figures likely felt free to engage in dodgy behavior in broad daylight: They didn’t expect anyone to care. And absent the scrutiny that came with Trump’s political success, such activities probably would have gone ignored.
.. Federal prosecutions of white-collar crime — a category that includes tax, corporate, health-care or securities fraud, among other crimes — are on track this year to reach their lowest level on record.
.. But the downward trend in white-collar and official-corruption prosecutions predates the Trump presidency. The Barack Obama administration, you may recall, was often criticized for failing to hold corporations and executives accountable in the wake of the financial crisis.
Some argue that big corporations and the wealthy have become too politically influential. Jesse Eisinger, in his excellent book “The Chickenshit Club: Why the Justice Department Fails to Prosecute Executives ,” blames a culture of risk aversion in the ranks of the Justice Department. Eric H. Holder Jr., an attorney general under Obama, once suggested that corporate consolidation left some firms too big to jail.
But undoubtedly part of the issue is resources.
After 9/11, for instance, terrorism investigations became more of a priority, crowding out available dollars and personnel for white-collar investigations.
.. Astonishingly, this decline in enforcement is now being cited as evidence of innocence. Manafort’s lawyer, in his opening statement last week, shamelessly suggested that his client must not be guilty of tax fraud because he’d never been audited.
.. Joseph diGenova objected to Mueller’s criminal prosecution of Manafort in part because Manafort “has no criminal record.”
.. Manafort’s prosecution today is less a sign of Mueller’s overreach, and more a sign of the rest of our federal government’s decades of underperformance.