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Billionaire Trump donor explains he’s in it for the tax cuts, not the racism

The fundamental truth about what keeps Trump in power.

SoulCycle Opens Its First International Studio In London
Stephen Ross, the owner of SoulCycle, is facing a backlash over holding a fundraiser for President Trump.
David M. Benett/Dave Benett/Getty Images for SoulCycle London

If you want to understand what’s really happening in America in the Trump era, you could do a lot worse than read a statement provided to the press Wednesday evening by Stephen M. Ross — a rich guy who, like a lot of rich guys, enjoys spending some of his riches in order to influence public policy to make himself richer.

As a fan of turning wealth into political influence, which begets more wealth, Ross wants to see Donald Trump continue to entrench himself in office. But at the same time, like a lot of other rich guys, Ross got rich in part by selling services to the affluent masses of urban America — specifically through the upscale gym Equinox and the bicycle “cult” SoulCyle — so when news broke that Ross was hosting a Trump reelection fundraiser at his Hamptons mansion where tickets sold for up to $250,000 a pop, it damaged Ross’s brand.

In an effort to stave off criticism, Ross told the press that he has “known Donald Trump for 40 years” and that “while we agree on some issues, we strongly disagree on many others.” He didn’t explain which issues were which, but he concluded by saying “I have been, and will continue to be, an outspoken champion of racial equality, inclusion, diversity, public education, and environmental sustainability, and I have and will continue to support leaders on both sides of the aisle to address these challenges.”

Billionaires benefit enormously from Trump

It’s interesting that though Ross is willing to support Trump’s reelection bid in material ways, he doesn’t seem particularly inclined to tell us what the issues are on which he agrees with the president.

Instead, he gave a laundry list of progressive-friendly policy stances that he wants to be seen as holding. It’s pretty clear, however, that Trump is not a big champion of environmental sustainability. Not only does the president mock climate change as a conspiracy theory and tell people that windmills cause cancer, he’s also overseen an unprecedented reversal of decades of progress against non-climate air pollution even as scientific evidence mounts that smog is killing tens of thousands of Americans a year.

Trump has also been an outspoken racist for decades, and his inflammatory rhetoric about immigrants directly parallels language used by the El Paso shooter’s manifesto and other white nationalist killers.

The issue on which Ross agrees with Trump is likely taxes. Ross has an estimated net worth of $7.7 billion. And while you might think that part of the pleasure of having $7.7 billion is that you don’t need to sweat the small stuff, the fact of the matter is that Trump’s changes to the estate tax alone are worth $4.4 million to a guy like Ross. The median American’s net worth is about $97,000, meaning that Trump and congressional Republicans handed Ross a chunk of change that’s more than 40 times as large as the typical American’s total wealth. That’s a pretty good reason to care passionately about the 2020 election.

But of course Trump’s tax cuts didn’t stop there. Ross is getting thousands of dollars a year in basic rate cuts. And while he is best known for his fitness-related consumer brands, he’s also a major commercial real estate developer, and since Trump is also in this line of business, his tax law is loaded with special provisions to specifically help that genre of rich person.

It’s quite plausible that Ross is telling the truth and he legitimately does have profound disagreements with Trump over certain culture war issues. It’s just that the amount of money at stake for Ross, personally, in the question of Trump’s political success is mind-boggling — far more than the typical person deals with in their lifetime or can even really conceive of.

Trump’s racial demagoguery serves a plutocratic agenda

Of course it’s also possible that Ross is not being truthful about his interest in racial equality and environmental sustainability. Certainly to line up behind Trump suggests a kind of indifference to the concerns of people of color, whether or not you specifically share Trump’s hostility toward them.

But from Ross’s point of view, it doesn’t really matter. Ross has a lot of money, and Trump has the ability to shovel a lot more money into Ross’s pockets. An investment of hundreds of thousands of dollars in Trump’s reelection could generate a return of millions through tax cuts. And this is critical to understand not just for Ross personally but for Ross as a stand-in for a broader conservative political movement.

As Tim Alberta masterfully details in his recent book American Carnage, leading Republicans — including stalwart members of the Trump administration like Chief of Staff Mick Mulvaney — were fiercely critical of Trump throughout 2015 and 2016 when they thought his antics were a burden to their policy agenda. Even when Trump unexpectedly won the election, trepidation remained. He had, after all, promised to deliver universal health care and oppose tax cuts for the rich.

But instead, he adopted a conventional regressive economic agenda and in doing so won the hearts of the GOP donor class and the conservative establishment. That’s the reason he’s able to “get away with” a scale of abuses in terms of personal corruption, broad incompetence, and alarming racial demagoguery.

Trump is running a big political risk, for example, by backing a lawsuit that would toss out the entire Affordable Care Act based on a dubious constitutional theory. But several of the ACA’s provisions raise taxes on wealthy Americans, meaning Trump’s willingness to run this risk is potentially worth huge sums of money to Ross and his ilk. Tens of millions of Americans will lose their insurance if Trump gets his way, but the money saved by the federal government will flow directly into the pockets of millionaire investors, who therefore have good reason to be grateful for Trump.

This stuff is not the foundation of Trump’s popularity, but it very much is the foundation of his political impunity. Impeachment, meaningful congressional oversight, and everything else is on hold because Trump’s presence in office serves the interests of the billionaire class.

The electorate looks very different

The political and financial clout of people with Ross-type views is important to understand in part because it’s relatively rarely held in the electorate.

A new detailed study from the Voter Study Group released this week shows that voters with conservative views on immigration but progressive views on economics (the top left corner of these charts) are relatively common compared to voters with progressive views on immigration and conservative views on economics (the empty bottom right corner).

In particular, among rank-and-file Republicans, far-right economic views are not particularly common and a decent chunk of people are left of center on economics.

Voter Study Group

This aligns with Vanderbilt University political scientist Larry Bartels’s finding that rank-and-file Republicans are unified on a broader set of racial identity issues but have a lot of internal disagreements about economic policy.

All of which is to say that regardless of Ross’s personal views on racial equality, it’s not just that he’s willing to overlook Trump’s retrograde attitudes on these issues for the sake of tax cuts. The political focus on racial conflict is integral to the political viability of the tax cut program. A national debate that focused primarily on whether 20 million people should lose their insurance so that Ross can get a tax cut would be a disaster for Ross’s personal financial interests. To get what he wants, he needs a big national argument about race even while he’d like his more culturally progressive customers to believe he’s secretly on their side.

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