Trump may have to get used to this kind of 'behind bars' view sometime in the not to distant future.
“I’m the king of debt. I’m great with debt. Nobody knows debt better than me. I’ve made a fortune by using debt, and if things don’t work out I renegotiate the debt. I mean, that’s a smart thing, not a stupid thing. […] You go back and you say, hey guess what, the economy crashed. I’m going to give you back half.”[1]
For once, Trump might have actually hinted at the truth.
Introduction
The shutdown may be over, but the wall issue remains. A question I haven’t seen asked or answered in a compelling fashion is why Trump, seemingly out of the blue, changed his tune, to the chagrin of those who support him, from concrete to steel slats to build his precious border wall.[2] In researching this question, I couldn’t find a definitive reason, merely speculation. In digging deeper, however, that speculation may be exactly the kind of reason that Robert Mueller has spent much his life, and certainly his on-going investigation into Trump, trying to uncover and stop.
Please note: this is just a theory. With the recent reports of Trump being suspected as a Russian agent, and ever-more links between Russia and Trump becoming clearer, however, I hope you read with an open mind. And I hope it passes the Daily Kos test of not being too conspiracy theory-esque, but in this day in age, that particular bar would seem pretty low.[3]
With that as preface, here goes. To my reading, it seems entirely possible that President Donald Trump wants to build a steel wall, as opposed to concrete, as a means — he hopes — to pay off his hundreds of millions of dollars of debt to the Russians. Or perhaps he is being forced to, lest the Russians reveal Trump’s perfidy. But in either case, given that Trump is a renowned cheapskate, I think he’s excited at the idea that he might be able to use American taxpayer dollars, and not his own, to try to meet his obligations to the Russians.
Robert Mueller describes a new kind of criminal threat
In a speech he gave in 2011, the then-director of the FBI, Robert Mueller, described how the kind of criminal and terrorist threats the world was facing had changed due to technology and the interconnectedness it brought. No longer was organized crime primarily a local or regional problem, a la the Sopranos. Instead is has become multi-national, multi-billion dollar enterprises involving numerous types of organizations that are sophisticated and can move in and out of legal and illegal operations with alacrity. And they all share the same motivation: greed.[4]
Mueller explained the far-reaching effects of these criminal activities. It is in health-care systems, intellectual property and copyright abuse, oil and gas, metals and minerals, stocks and securities, computer hacking, human trafficking, and on and on. Even without the public knowing, it can affect each and every one of us, down to how much we pay at the gas pump, how much we pay for food, how much it costs to get a mortgage.
He also described what he called, “iron triangles,” or cooperation between “organized criminals, corrupt government officials, and business leaders” that are interested in not only financial crimes and gain, but that could pose “a significant national security threat,” as well. This could be in the form of “logistical support to hostile foreign powers,” or perhaps efforts to “manipulate those at the highest levels of government.” It stands to reason that this is exactly the kind of thing that the Special Counsel and his team have been investigating regarding our president.
How much does Trump owe and what has he done thus far to pay?
Trump is greedy, and he likes to use debt to feed that greed - of that there can be no doubt. The presidency, however, has not provided Trump with any kind of apparent financial windfall. In fact, Trump’s wealth has dropped since taking office. Forbes magazine estimates that his net worth has gone from $4.5 billion in 2015 to $3.1 billion two years later, a fall of approximately 30%.[5] Regardless of the amount, Trump has still used loans to create that wealth. It has been reported that Trump is most likely heavily indebted to both Russia and China, to the tune of hundreds of millions of dollars.[6] No matter what the exact amount owed, those debts represent a significant—and growing—portion of his shrinking wealth. Trump also has a well-deserved reputation for not paying his debts, be they bills to small contractors or loans to big banks.[7] While the Chinese may be willing to carry his debt, the Russians are not known to be so patient or forgiving.[8]
An early example of something fishy: the Keystone XL Pipeline
During his first week in office, Trump ordered the restart of the Keystone XL pipeline construction project, valued at $8 billion, which President Obama had previously blocked.[9] At first, as he did across all industries, Trump promised that the pipeline would only be made from American steel. Shortly thereafter, however, that changed. One reason was that American steel companies did not make enough of the kind of pipeline needed.[10] While there is truth to that, there was also speculation that Trump created an exception to “made in America” because there were foreign interests that Trump chose to accommodate instead.[11] This exception has remained in place despite the subsequent protectionism of the 25% percent tariff that President Trump imposed on steel imports.
One of the companies that benefited from the exception was Evraz, the second-largest Russian steel company. Controlling ownership of this company is held by a Russian oligarch named Roman Abramovich. Abramovich is one of Putin’s closest political allies and confidants, to the point of having recommended to then-President Boris Yeltsin that Putin be his successor.[12] Abramovich is close, also, to the Trumps and the Kushners. For example, his wife (perhaps his ex-wife by now, as I read they split, but that’s not all that important) attended Trump’s inauguration, at first-daughter Ivanka’s invitation.[13]
Jump to the present day, where construction of the Keystone pipeline has been on hold since Trump’s order because of on-going litigation. Nonetheless, Evraz, Abramovich, and likely Putin, himself, stand to profit handsomely as they are responsible for at least a quarter of the pipes to be used in the pipeline.[14] [Update note: A couple comments below have stated that the pipeline steel not coming from India is coming from Canada. To my understanding that is correct, but it appears that the Canadian company is a subsidiary of Evraz.]
Moreover, it should be noted that Evraz and at least one other Russian steel company are not concerned with the new steel tariff. In the case of Evraz, its North America subsidiaries sell 5.5 times as much steel in the United States than Evraz exports to the United States from Russia, and domestic price increases would more than offset the costs associated with the tariff.[15]
The Wall: Concrete or Steel?
Then comes Trump’s wall. From the outset – literally, for years now – Trump promised a concrete wall. Then, just a couple weeks ago, seemingly out of nowhere, it became steel slabs.[16]
First, let’s look at some of reasons Trump has given. He has said that it’s going to be “more beautiful” than concrete. Really? Who cares? It’s in the middle of the desert. Next, he has said that it should be steel because we have steel companies “again.” Equally confusing, he said that opponents would feel better about steel and that he can “understand what they are saying.” Additionally, he has said that steel is stronger, but even that seems in question as tests on steel slat prototypes have shown that it can be penetrated.
Finally, however, the most ridiculous and perhaps telling reason given by Trump is this:
“One of the things with the wall is you need transparency. You have to be able to see through it. In other words, if you can’t see through that wall -- so it could be a steel wall with openings, but you have to have openings because you have to see what’s on the other side of the wall.
And I’ll give you an example. As horrible as it sounds, when they throw the large sacks of drugs over, and if you have people on the other side of the wall, you don’t see them -- they hit you on the head with 60 pounds of stuff? It’s over. As cray [sic] as that sounds, you need transparency through that wall.”[17]
This from a man who has never shown an ounce of what almost sounds like compassion for anyone, let alone the very people he made the scary demons of his presidential run.
Next, a steel slatted wall is more expensive.[18] Exactly how much more expensive is difficult to estimate because of a lack of design specifics. Going from estimates regarding how much a concrete and rebar wall would cost, however, which is approximately $25 billion, a back of the envelope guesstimate is that $50 billion would be easily within in the realm of possibilities.[19]
In any event, none of the reasons Trump has given for the change are even close to compelling. Trump obviously has something else in mind, and we all know his mind only thinks about Trump. Which brings us back to his debts to Russia and Evraz. Reports indicate the company is one of the primary providers of the kind of steel slabs needed to make the slats that Trump seems to be talking about, and that it would profit from the change in materials.[20] Therefore, Russian interests, reaching all the way up to Putin, stand to make a lot of money on a steel wall. Trump has seemingly already attempted to do — or been forced to do — something like this once before without consequence, with the Keystone pipeline. Why not again? Why wouldn’t Trump, the skinflint that he is, jump at the chance to negotiate away his debt to Russia, especially when the U.S. taxpayer would be footing the bill? Or perhaps Putin is forcing Trump to change to steel in order to keep his secrets hidden and make some money at the same time? In either case, you can almost hear Putin laughing from here.
Regardless, we should all be thankful that we have Mueller in our corner. This would seem to be exactly the kind of criminal plot he described in 2011, and that he has been fighting for much of his career.
The King of Debt, indeed.
Now if you’ll excuse me, I think I need to go outside and get some fresh air.
[12] Sakwa, Richard (2011). The Crisis of Russian Democracy: The Dual State, Factionalism and the Medvedev Succession. Cambridge University Press.
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