It's amazing, but nearly a year into the Trump campaign the pundits still don't get it: the louder established members of the broken, crony capitalist status quo rail against Trump, the higher his popularity. And there are few more entrenched crony capitalists than the partner of Barack Obama's "tax advisor", the person who singlehandedly crushed the Keystone XL pipeline project so it would generate more profits for his oil trains, Hillary's number one supporter (perhaps tied with Lloyd Blankfein), Warren Buffet's sidekick Charlie Munger.
Earlier today Munger, the vice chairman at Berkshire Hathaway Inc., dismissed Republican Donald Trump’s qualifications to be president, during the annual meeting of his Daily Journal Corp. As reported by Bloomberg, Munger, 92, responded to a question whether a person who couldn’t make money in the gaming industry would be a good fit for the top office in the U.S.
“Well, he did make money for quite a while,” Munger said. “My attitude is that anybody who makes money running a casino is not morally qualified.”
The refernce, of course, is to Trump's several corporate bankruptcies. What was omitted is any discussion of how bankrupt Munger, Buffet and/or Berkshire Hathaway would have been had their extensive financial stakes not been bailed out by the US taxpayer during the financial crisis, something profiled by Reuters in 2009.
Rolfe Winkler wrote back then:
A good chunk of [Buffett's] fortune is dependent on taxpayer largess. Were it not for government bailouts, for which Buffett lobbied hard, many of his company’s stock holdings would have been wiped out.
Berkshire Hathaway, in which Buffett owns 27 percent, according to a recent proxy filing, has more than $26 billion invested in eight financial companies that have received bailout money. The TARP at one point had nearly $100 billion invested in these companies and, according to new data released by Thomson Reuters, FDIC backs more than $130 billion of their debt.
To put that in perspective, 75 percent of the debt these companies have issued since late November has come with a federal guarantee
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As Roger Lowenstein wrote in his 1995 biography of Buffett, “Wall Street’s modern financiers got rich by exploiting their control of the public’s money … Buffett shunned this game … In effect, he rediscovered the art of pure capitalism — a cold-blooded sport, but a fair one.”
But there’s nothing fair about Buffett getting a bailout, about exploiting the taxpaying public for his own gain. The naïve 14-year-olds among us thought he was better than this.
Maybe Munger would have been happier if Trump, like Buffett, had gotten a taxpayer bailout instead of following old-fashioned capitalism deep into the halls of bankruptcy court. Then again, Trump was never too systemically important to fail.
But where Munger hit peak hypocricy, was his comment about the man who made Berkshire's rise to financial superstardom possible in the first place, Fed Chairman Alan Greenspan, the man who unleashed the Great moderation: "He's an amiable man but he was an idiot."
It's comments like these, Charlie, that assure why Trump's rating will rise even higher in the next primary.