The Outstater

March 29, 2024

Donald Trump and ‘Truth Social

ONE THING ABOUT the old smoke-filled rooms was we knew who was in them — and that they were all U.S. citizens. Campaign finance “reform” took that away.

The Virginia House of Burgesses prohibited George Washington from popping a cork for some political friends: “No money, meat, drink, entertainment or provision, any present, gift, reward or entertainment, etc. can be given in order to be elected,” spake the Burgesses.

Clear enough, but jump forward to Oct. 15, 1974, and President Gerald Ford blithely signing the Federal Election Campaign Amendment and promising “no more dirty tricks.” The political apparatus immediately set to work on new and dirtier tricks. 

So if you think you understand campaign finance regulations, you’re mistaken. Nobody does, they’re still inventing them. We are at the point where you can only hope your guy cheats better than the other guy.

That could not be made clearer than with Donald Trump’s successful use of the stock market as a campaign chest (a move perfected earlier by Paul Pelosi). We have asked every expert we know and nobody can tell us why Trump’s “Truth Social” isn’t a money-laundering scheme to work around campaign finance laws. 

At best, it is a way for players on the stock market to invest in the vaunted Trump “brand” if he wins the presidency, literally betting that their portfolio will be carried along in one way or another. Sort of like buying Berkshire-Hathaway in 1965 because Warren Buffet was your county chairman.

To fill you in, Truth Social is owned by the Trump Media & Technology Group, the majority of which is owned by Donald Trump. Its stock climbed 16 percent Tuesday, its first day on the market. It had jumped another 14 percent by late Wednesday but slipped by today’s Easter closing. Still, its market valuation of just over $8 billion is stunning for an unproven business model.

For Truth Social, a social media platform competing in a crowded field, doesn’t currently make anything or sell anything. Indeed, it doesn’t appear constructed to log a conventional profit. “This is people voicing their political opinions through the markets,” a financial data consultant told ABC News. “There’s nothing going on that has anything to do with the financial fundamentals.” 

Think of it as a new version of the Barack Obama book “sales.”

But after almost a half century of serious reform, how is all this possible? It is because disincentives have never matched incentives — purposely, if you understand how the Congressional mind works. A monetary fine doesn’t cut it when the game is control of the political machinery of the United States of America. Nor do stiffer penalties only imposed through a labyrinth of court rulings, counter rulings and appeals.

The solution, rejected back in 1974, was to put reform on the same regulatory footing as, say, a driver’s license: You must be who you say you are. 

In the context of campaign finance, that would mean, on penalty of mandatory and lengthy imprisonment, that any U.S. citizen could contribute whatever to any political campaign as long as he did so specifically and in his own name. That would exclude political action committees, foreign bundlers, union book-signing parties, mail-in ballots, meme stock offerings or anything else the quick and the clever can dream up. 

The political winds may be blowing in that direction. A Fox News poll found that “election integrity” is the second most urgent issue in the upcoming presidential election, right behind perennial concern “the economy.” Other polls show both liberals and conservatives equally concerned over ensuring fair elections.

“Which leads to the question: What is election integrity?” writes Byron York of the Washington Examiner. “Is it Democrats worried that Trump and Republicans will cheat? Is it Republicans worried that Biden and the Democrats will cheat?”

Like we said, you can only hope the other guy doesn’t out-cheat your guy. — tcl


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