The Scenario of American Elite Groups Before the Presidential 2020 Elections
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The Scenario of American Elite Groups Before the Presidential 2020 Elections


ALABAMA - March 15, 2019

The expert community is actively discussing possible scenarios for the development and completion of the 2020 presidential campaign.

The foreign analysis and information environment is characterized by an extremely ideologized approach where the authors build arguments on the basis of personal sympathies for a particular policy and party. In turn, within the framework of this analytical essay, we would like to reveal a complex and multi-layered behavior theme of various elite groups before the most important electoral cycle.

Elite groups should be understood as an organized minority with significant qualitative and quantitative resources to influence the process of formation and adoption of strategic and tactical political decisions. These groups can be divided into many conditional subgroups, united with narrow political, economic, religious, ideological, and professional interests. At the first level, it is necessary to determine the state of traditional lobbyists, whose struggle largely determined the internal state of American statehood.

Financial elite

The largest group of heavyweights is the financiers, which include such areas as investment, banks, insurance, and development.

From 1990 to the present day, these members have spent $6 billion on political lobbying -- 56% from Republicans and 43% Democrats.

Over the past four years, the total cost amounted to $2.23 billion, of which $1.8 billion was sent to the direct funds of parties and individual officials.

As one of the most pragmatic strata of the organized minority, the financiers kept the party balance. Such a strategy is justified in some degree, given some of the American state system features: competition between the executive (White House) and legislative (Congress) government branches, clashes within the administration between the different factions, the zealous stance between the Capitol chambers (House of Representatives and the Senate), the inter-party struggle, factional groups within the party, caucus meetings, etc. However, after Barack Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act), the scales tilted toward the Republicans. This Act has created new mechanisms to increase the transparency of the financial system to protect taxpayers from unfair acts of financial companies. In addition, the Obama administration and its party members in Congress, adopting this Act, sought to lift the burden on the state to save the major financial giants (the "too big to fail" theory) and abandon OTC trading (including precious metals and currency).

Today, the backbone of the financial lobby provides support to the "Grand Old Party" (GOP), which is consistently trying to repeal the Act.

The most generous clients of the Republicans are the global organization Citadel LLC (more than $19 million in 2017-2018), the investment group Blackstone Group (more than $15 million in 2017-2018) and the investment management firm Elliott Management (almost $7 million in 2017-2018). Citadel and Blackstone also act as lobby operators of the Goldman Sachs investment bank, and Elliott performs the same function for its competitor Morgan Stanley.

The balance between these giants and their conditional allies is supported in the Trump administration because of the struggle of the groups of Finance Minister Steven Mnuchin, who worked at Goldman Sachs as Vice President and his Deputy Justin Muzinich, the former head of the special group Morgan Stanley on mergers and acquisitions. Hedge Fund Renaissance Technologies, whose position Jared Kushner, senior adviser and Presidential son-in-law, protected, is in a privileged position.

Renaissance has become the largest Trump donor and will likely be in the top three in the new collection for the Republicans. Such a configuration allows different influence groups to lead a healthy lobbying competition, which allows Donald Trump to count on the support of the main players in the industry.

Liberal forces, including the Democratic Party, over the past two years, have received significant contributions from the Bloomberg Lp Corporation (more than $95 million), investment group Paloma Partners (more than $25 million), and the Soros Fund Management company (more than $18 million).

After Hillary Clinton's unexpected defeat, the pro-democratic financial sector is in search of a new candidate. One of the main potential candidates is former Vice-President Joseph Biden, who is a fundamental opponent of any transactions with financiers, which creates certain difficulties for the latter.

Senator Bernie Sanders, who has already begun an active campaign, has a similar position. For the first time since 1992, they cannot find a systemic party candidate and are forced to put their own candidates on the political front. The possibility of billionaire Michael Bloomberg, who said recently he was ready to spend at least $500 million to prevent Trump from being re-elected, participating in the 2020 race is being actively discussed. Bloomberg stressed that in case of his non-nomination, the funds will go to the Democratic primaries winner. Half a billion dollars is a serious amount, and Bloomberg — an experienced politician and pragmatic financier — went to such a demarche, hoping Biden will open himself up. Still, a billionaire candidate from the Democrats is obviously a losing position and the best gift for the Republicans.

The second group is the Military-Industrial Complex and Special Services.

These elites have a more complex structure and system of relationships. At the first level, the elites are fighting for preferences in budget development and adoption, so the Pentagon and intelligence are used as lobbyists for both parties’ representatives. At the second level, competition begins between internal groups: the Department of Defense Ministry on the one hand and individual intelligence agencies (FBI, CIA, NSA) on the other. At the third stage, when the budgets of the military and special services go through all stages of approval, the process includes the largest corporations seeking to obtain profitable state orders. The main players on this track are Lockheed Martin, Boeing, Northrop Grumman, and Raytheon. Lockheed Martin's interests in the current administration are lobbied by a group of Vice President Mike Pence, who promoted another longtime ally of the same corporation General James Mattis to the post of Defense Minister.

He, in turn, recommended to Trump his colleagues Herbert McMaster and John Kelly to the position of National Security Adviser and Chief of Staff. Thus, lobbyists  for Lockheed Martin at the time received almost a monopoly influence on the White House and the Pentagon. Initially, the balance on the line of the military industrial complex was conceived by appointing Mike Pompeo (a Boeing lobbyist) with the Secretary of State. At the same time, Northrop Grumman and Raytheon representatives maintained their influence through "second line" politicians (deputies, heads of departments, etc.).

However, the Lockheed Martin lobbyists’ alliance with Exxon Mobil changed the power balance, resulting in Trump choosing Rex Tillerson, who at that time held the position of director of the above oil company. Pompeo got the position of Director of the CIA, but in terms of real budget dividends for Boeing, this structure is much less important than the Pentagon or the State Department. Pompeo took revenge, supporting Jared Kushner in the fight against Stephen Bannon — the second senior adviser and chief architect of the Republican victory. Bannon's resignation led to the Pence group’s weakening, which, due to the chain reaction, led to the ousting of McMaster, Mattis, and Kelly from the administration. At the same time, the efforts of the conditional "triple alliance" of Kushner with Chevron, Energy Transfer Partners (Rick Perry is the Secretary of Energy under the current administration), and Boeing led to the Tillerson surrender and the Pompeo appointment as head of the Foreign Ministry. Under Pompeo and the new Defense Minister Patrick Shanahan (who worked in Boeing since 1986), the corporation managed to regain its influence. In addition, the position of Secretary of State is also important for Boeing in terms of pushing its civilian products on the international market, where the main competitor is the European aircraft manufacturer Airbus.

In turn, Lockheed Martin’s loss of Mattis, McMaster, and Kelly was offset by the appointment of new National Security Adviser John Bolton and the resignation of the U.S. Ambassador to the UN Nikki Haley, who has already been officially nominated as a candidate for the Boeing Board of Directors.

Raytheon lobbyist Mick Mulvaney took the position of the head of the presidential office. Thus, internal wars between different elite groups, which led to numerous personnel changes, contributed to the formation of power balance between the giants of the military-industrial complex. Thus, according to the 2019 budget, the Pentagon requested money to buy a total of 77 F-35 fighters from Lockheed Martin (in 2018, the request for 99 units was satisfied). Boeing received solid orders not only for defense orders. Presidential administration lobbying of large transactions for the company in the civil sector to some extent compensates for the large volume of military orders from Lockheed Martin. During the last visit to Vietnam, agreements were signed for the purchase of 100 Boeing aircraft for local airlines in the amount of $20 billion (a victory over Airbus). In turn, Northrop Grumman Corporation should be awarded a contract to replace the U.S. Air Force navigation system, which means the success of its lobbyists in promoting an expensive program to upgrade F-22 fighters and deck-based long-range radar detection aircraft Grumman Hawkeye. In general, the administration has managed to achieve a consistent increase in the military budget and balance the influence of lobbyists in this sector, which also leaves Trump cause for optimism. In other words, the rear is covered.

Trump's relations with classical generals and a number of influential groups from intelligence agencies are much more complicated. The Joint Chiefs of Staff (JCS) — that is the General's lobby locomotive — under Joseph Dunford was split into several conventional elite clubs.

The first such club was formed on the principle of "ethno religious origin."

Today, the most influential is the Catholic Celtic Group, which unites the generals of Irish, Scottish and Welsh origin. Andrew Jackson, the 7th United States President, who laid down the principles of Jacksonian democracy in politics, was born in the Irish-Scottish family and, being a military man, believed Celtic representatives are best suited for the recruitment of officers of the armed forces. Indeed, from the war of independence to modern campaigns in Afghanistan and Iraq, these peoples were best remembered for their outstanding qualities as excellent strategists. The last three heads of the JCS, Michael Mullen, Martin Dempsey and Joseph Dunford have Irish heritage and profess Catholicism. The links between these groups are ensured by close interdependence, which is expressed in the promotion of its representatives to leading positions in the military sphere.

They are opposed by the conditional "German-Dutch Protestant club."

These group members are traditionally well represented in the high command of the air force. The most significant successes were achieved under Generals Lyman Lemnitzer and Richard Myers, who headed the JCSin 1960-1962 and 2001-2005, respectively. During the Cold War, the struggle of these camps was on an equal footing, despite that the first head of the JCS, Fleet Admiral William Daniel Leahy, formed created an institute on the basis of the Celtic "Jacksonian" principle by President Franklin Roosevelt’s order ("American-Dutch elite" of Van Rosenvelts). The balance has been broken since 2005 with Meyers' departure, and now there is total domination by the first group. Despite internal competition, both groups sympathize with the Republican Party, and very rarely the "Irish military elite" supports the political initiatives of the conditional "secular Irish elite" oriented to the Democratic Party. The attitude to Trump himself, on the one hand, is positive, in view of his election of the course of "Jacksonian," on the other hand, they negatively perceived the dismissal of members of their group from the administration — National Security Adviser Herbert McMaster (General, Scottish Catholic) and John Kelly (General, Irish Catholic), head of the White House staff.

Decisions on these personnel have become a big headache for Trump, causing a crisis not only in relations with the "Irish military bloc" in the JCS and the Pentagon but also with a small but influential "Celtic Republican caucus" led by the leader of the Republican majority of the Senate Mitch McConnell and the head of the Committee on International Affairs James Rish. Vice-President Mike Pence then was the mediator in the crisis settlement (Irish, who changed from Catholic to Protestant after marriage). Then appeared the compromise solution between all parties (including the Boeing Corporation) on the appointment of the Irish-Catholic Patrick Shanahan to the position of acting Minister of Defense.

Trump’s additional bonus for the conservative Celtic group was the appointment of another Irish Catholic Brett Kavanaugh to the position of Supreme Court Justice. This arrangement minimized the risk that this elite core will support another candidate in the 2020 elections (however, the threat of a partial split in the case of the nomination of one of the leaders of the "Irish elite," Joe Biden, still exists).

The second club unites generals on the basis of belonging to this or that kind of troops. Nine chapters of the Joint Chiefs of Staff were Army, five Navy, including Admiral Leahy, four were from the Air Force, and two from the Marine Corps. Each of the groups lobbies their interests, seeking to achieve greater budgetary preferences. Today, the Army generals are dissatisfied that there is a funding increase for the Navy and Air Force by reducing expenditure items for infantry. The Army Chief of Staff Mark Miley disagrees also with the policy of reducing contingents in Iraq and Afghanistan. However, this group is encouraged by Trump's opinion about the need for the US allies to pay contributions to NATO in full (it is planned that part of the savings will be directed specifically to the needs of their own army). Democrats always play on the internal contradictions of the military class and try to get the maximum dividends. Most of all, the Democratic Party sympathizes with the elites of the National Guard and the Coast guard, to which the Republicans don't pay due attention.

The Energy Lobby

Last year, the energy sector spent $138 million on lobbying -- much less than during Democrat Obama’s presidency. Its measures to combat climate change and the consistent reduction of state subsidies to major oil and gas players led to the formation of a major alliance in support of the Republican Party in 2016. Despite that Trump was not their main favorite (the bet was made on Texas Senator Ted Cruz), his efforts to withdraw the US from the Paris Climate Agreement, and to get approval of the construction of the Canadian-American Keystone pipeline and the return of subsidies were welcomed.

It is also important that in 2014 America became a world leader in terms of oil production, ahead of Saudi Arabia and Russia. According to OPEC, in 2016 the United States also took the lead in natural gas production, beating Russia and Iran. Such statistics already affect Washington's foreign policy behavior on the Middle East track (the main source of satisfaction of the energy needs of Americans until 2014), making it more cautious and pragmatic. Today, the main struggle takes place within the sector, and the main players are Exxon Mobil, Koch Industries, Chevron, Energy Transfer Partners and Occidental Petroleum. Tillerson's victory over Pompeo in the struggle for the Secretary of State with the support of MIC lobbyists from Lockheed Martin for some time created the illusion of Exxon Mobil having a privileged position in the administration.

However, the external interests of this company also cover Russia, where for a long time, together with Rosneft, multibillion-dollar projects have been carried out. "Hawks" from the Senate Committee on international Affairs seriously feared that the former director of the oil giant would lobby for the lifting of sanctions against Moscow and use the State Department as a tool to promote the corporate interests of his native corporation. Sen. Marco Rubio, one of the leading Koch Industries lobbyists, who owns 4,000 miles of pipelines across the country and has processing facilities that cover 5% of Americans' daily fuel demand, was particularly tough on Tillerson. For the brothers Charles and David Koch, whose total wealth is estimated at $120 billion (which is 8 billion more than the estate of Jeff Bezos), Exxon is a competitor in the production of petrochemical products and the main opponent in the struggle for preferences for laying the Keystone pipeline on American soil. Koch family lobbyists (mainly senators from the Tea Party) lost in the first round, but in the end cooperation with Chevron and Boeing led to success. Now Minister of Energy Rick Perry plays first fiddle in the administration, defending the interests of Chevron (especially of its foreign assets in Canada, Asia and Africa) and Energy Transfer Partners, a Texas transporter of natural gas.

The Congress, not the White House, is in, unlike many other companies the Koch Industries priority. This is due to a significant proportion of their business interests beingin the competence of the relevant committees of the House of Representatives, and the brothers pragmatically seek to influence the balance of power in the legislative branch. However, they are actively funding Republican candidates from different factions and independent candidates to prevent the Democrats from winning -- a more complex configuration of Occidental Petroleum interests, which is in the sphere of influence of the Hammer family. Both branches of the family — California and Tennessee — traditionally maintained a balance between Republicans and Democrats. The family founder, Armand Hammer, financed the campaigns of California conservatives Richard Nixon and Ronald Reagan and was even one of the defendants in the Watergate scandal (a political scandal that led to the resignation of President Nixon). In parallel, the family developed friendly relations with Senator from Tennessee Albert Gore senior, who became a lobbyist for the federal generating company Tennessee Valley Authority. Since then, members of the Hammer family have supported the Gore clan, including Albert Gore Jr., who followed his father's footsteps, becoming a Senator.

The long-term war of the California Oilmen Hammers with the Texas clan coalition (Exxon, Chevron and Halliburton) in the presidential 2000 campaign ended with the victory of the latter in the person of Bush Jr. (Exxon) and Cheney (Halliburton). In the upcoming race, Trump will be supported by Chevron, Energy Transfer Partners, and Koch Industries, and his opponents can count on the help of Exxon Mobil and Occidental Petroleum. However, it is important to emphasize that it’s because of Trump’s personality, and not about a change of party orientation. Thus, in Congress, the oil and gas lobby invariably supports the Republicans, and it is unlikely that this tradition will change in the near future. It is likely that another scenario in which the second term of the Republican (in the case of re-election) will mark a radical change in the balance of power.

The Ideological Elite

Under ideological elites, it is customary to consider groups united on the basis of common moral, ethical, and religious views on domestic and foreign policy. The most popular topics in American society are abortion, free weapons carrying, ecology and international politics. Over the past two years, these sectors representatives have spent $644 million on lobbying, of which 60% were Democrats and 39.7% Republicans. At the first level, there is a confrontation between the right and left forces. The interests of the conservative elite are protected by several influential organizations, including the American Action Network, Republican Governors Association, and One Nation. These groups’ purpose is to promote traditional family values, to finance conservative politicians, and to protect the American capitalist model. Their funds are sent directly to the Republican Party and its individual members. There are wide-ranging campaigns among young people, payments for conservative universities (e.g. Yale University) and the media. The left and the liberal agenda are under the Democratic Governors Association, the America Votes organization, and the American Axle of the XXI Century fund’s protection. Liberal America, unlike conservatives, has more serious media tools, and it relies on a broad cross-section of the population, including millions of illegal immigrants. At the same time, within each of these elites (conservative and liberal), there are also separate associations and groups that oppose each other.

In the conservative wing, there are several conventional subgroups: traditionalists (followers of the Goldwater-Reagan line), moderate ("soft conservatism,” Bush Sr.) and hybrid forces such as neoconservatives and the Tea Party. Under the current administration, all factional groups are represented, which allows Trump not to doubt the consensus of the right forces to support his candidacy for re-election. The Democratic Party is also undergoing a transformation. Today it’s the internal struggle of the old elite (represented by the "Irish group" of Biden-Kerry) and the socialists, represented by Senator Bernie Sanders and young star Alexandria Ocasio-Cortez. The first group has not yet decided on its candidate. The last heavyweight of this elite — former Vice President Joseph Biden is theoretically able to give battle to the Republicans, but there are a number of factors that cause pessimism about his real chances. First, his age (in November 2020 Biden will be 78 years old), secondly, the Catholic religion. In American history, there was only one Catholic who managed to conquer the top of the political Olympus — John Kennedy. Third, his tough stance on a number of financial groups supporting the Democratic Party (primarily Bloomberg). In turn, the socialists have already supported Sanders, who began active propaganda activities. Thus, the most interesting in the coming campaign will be the Democratic primaries, which will be the last chance for the "elders."

At the second level, the interests of individual elements within the elites collide. The Evangelical lobby in the person of Vice President Mike Pence opposed the resolution on abortion and the unconditional support of Israel. Evangelicals were pleased with Trump's decision to appoint a staunch opponent of abortion Protestant Neil Gorsuch in the Supreme Court and the transfer of the U.S. Embassy from Tel Aviv to Jerusalem. The only area where they have not achieved success is same-sex marriage. Initially, the lobbyists managed to convince the President to begin the procedure of cancellation of the Federal law on the legalization of same-sex marriages, but a broad campaign of liberal elites with the support of Jared Kushner and Ivanka Trump led to the process freezing. The main competitor of this group is the conservative Catholic lobby. Promoting the abortion prohibition, they are Evangelicals’ allies but don't share their vision of international politics, particularly as concerns Israel. At the heart of their foreign policy ideology based on the principles of the need to support Ireland as a natural United States ally, the importance of deepening the dialogue with the Vatican, strengthen ties with Catholic Poland, which serves as an outpost for the containment of the imperial ambitions of the Russian Orthodox. In domestic policy, this group is the bearer of the "Jacksonian" philosophy. Trump won the sympathy of these elite with his appointments, including Brett Kavanaugh, an Irish Catholic (a balance after the appointment of Protestant Gorsuch).

Other influential friends of the conservative group are Cubans and Poles. The Cuban elite is considered the most organized, a rich and influential group in the Spanish-speaking would (Hispanic America). Suffice it to note that the two main Trump opponents at the Republican primaries were senators of Cuban origin Marco Rubio (Florida, Catholic) and Ted Cruz (Texas, adopted Protestantism). They oppose any dialogue between Washington and official Havana until the complete purification of its historical homeland from the communist regime (in this they are in solidarity with the Cuban Democrats in the person of Senator Robert Menendez). They also lobby for the wall on the US-Mexico border. For Cubans who have become part of the Republican elite, other Latin Americans (especially Mexicans) are seen as potential political, economic and electoral competitors. In addition, the reluctance of most Latinos to integrate into American society creates an anti-rating among the white groups, which automatically includes Cubans. It is not surprising that most of them in the censuses mark themselves as White Americans and not Hispanic. These same considerations formed the basis for the decision to support Trump in Florida in 2016 ( which had the status of a "fluctuating state").

The Polish Republican group leads an anti-Russian line, plays a major role in the sanctions policy, lobbies for strengthening and expanding the US military infrastructure in Eastern Europe, and supports initiatives for military-technical assistance to Ukraine. Democrats’ allies are liberal Irish elite (MA and NY), reform Jewish groups (New York), the Armenian organization (CA), and the Latin American Association. The task of most of them is to prevent immigration reform and introduce additional taxes for the wealthiest classes. The foreign policy guidelines usually are the idea of "Wilsonianism" (the creation of the global liberal order and the conduct of foreign policy based on moral clarity). Thus, the Armenian lobby does not participate in the formation and strengthening of the interstate agenda in the U.S.-Armenia relations, but in lobbying for the federal recognition of the Armenian genocide of 1915-1923 and building a political dialogue with Turkey as a country that denies the fact of the crime against humanity. Reformist Jewish elites demand from Washington pressure on the right forces in Israel, whose policy, in their opinion, does not contribute to peace and stability in the region. Progressive Arab elites are in favor of severing diplomatic relations with Saudi Arabia and other countries in the region where human rights are violated. Practice shows that democratic leaders use "Wilson's" rhetoric to get votes but act on the basis of "Realpolitik" because there is still no recognition of the Armenian genocide, no significant pressure on Israel and authoritarian regimes of Arab countries.

The weapons lobby, represented by the National Rifle Association (NSA), supports Trump as well. It is vital for the conservative elite to keep the Second Amendment unchanged and not allow Democrats to develop regulatory mechanisms. In 2016, the NSA sent $20 million to the structures that carried out propaganda against Hillary Clinton — a supporter of restrictions on the free carrying of weapons. The position of the incumbent President is clear: The Second Amendment cannot be revised, and the right to free possession of weapons is part of the American identity. In addition, he believes it is necessary to adopt an act that will allow school teachers and university professors after special training to carry weapons. In other words, Trump is actively lobbying one of the main ideas of the NSA on the revision of the status of "special zones" free of any type of weapon. The Everytown Fund is responsible for the reverse process, that is, the formation of control mechanisms. Arms control supporters maintain the Democratic Party by providing substantial financial assistance to its candidates at the local and federal levels. Their main favorites are Senators Tim Kane (who was a candidate for Vice President in the Hillary Clinton campaign) and Elizabeth Warren, who has already announced her participation in the 2020 race.

Thus, the power balance of the main elite groups shows that in the absence of any force majeure situations (e.g. the Muller Commission), Donald Trump is unlikely to face serious barriers to re-election for a second term. Moreover, the Democratic Party, which won the lower chamber from the Republicans, has not yet fully recovered from the shock after Hillary Clinton’s defeat in the previous election cycle. The most interesting will be the party primaries, during which the balance of power may change from favorites to obvious outsiders. America and its elites and political institutions are changing with each electoral cycle, and the coming one will be no exception.

Author: USA Really