Donald Trump seems to have landed on the time when he thinks America was truly “great”: the late 1800s. Mark Twain named it the Gilded Age.
The Progressive Era historian Vernon Parrington gave it a different name. He called that time of high tariffs, no income taxes, vast new fortunes, and government largesse “the Great Barbecue.” Many were invited, though “not quite all, to be sure; inconspicuous persons, those at home on the farm or at work in the mills and offices were overlooked; a good many indeed out of the total number of the American people. But all the important persons, leading bankers and promoters and business men, received invitations.”
A key to that era’s crony capitalism was the way the federal government paid for itself. Government was much, much smaller, of course, and barely did anything. Most of the executive branch fit into one office building (the elaborate pile now known as the Eisenhower Executive Office Building next to the White House).
But tariffs — the main way the government funded its operations — became a principal locus of lobbying, favoritism, and graft. Already, as in the original Gilded Age, the rot is starting to show underneath the gold veneer.
Two weeks ago, Trump declared a trade war all at once against the entire world, possibly not a fully thought-through strategy. One week after “Liberation Day” came “Capitulation Day” after the bond market signaled a rapidly approaching financial crisis. But the 125 percent tariffs on imports from China remained, plus or minus myriad exceptions and complications.
Super-high tariffs could be devastating to the consumer electronics industry. We all recall the startling vista on Inauguration Day of the country’s three richest men — Elon Musk, Jeff Bezos, and Mark Zuckerberg — sitting in the front row, ahead of the cabinet secretaries. Nestled in alongside them was Tim Cook, CEO of Apple, whose iPhones and other products are made in China. Tech firms raised alarms about the tariffs, with lobbyists swarming the administration.
So even as he kept the high taxes on nearly all products imported from China, late on Friday night Trump quietly announced that smartphones, laptops, and other similar devices were exempt from the tariffs.
This is raw favoritism. It also makes no sense on its own terms.
Howard Lutnick, the voluble commerce secretary, had explained that the tariffs sought to return these very industries to our shores. “We are going to replace the army of millions and millions of human beings screwing in little screws to make iPhones, that kind of thing is going to come to America.” (Those factories would be automated. Not to worry: The “tradecraft of America” would be to fix the HVAC systems at the automated iPhone factories!)
Anyway, Trump’s tariffs would make it more costly to build those iPhones here than in China, as the screws, the HVAC systems, and all the parts that we import to build those things would be subject to the new taxes.
The exceptions to the tariffs also show the regressive nature of these consumer taxes. Laptops costing thousands would be exempt, but clothes, toasters, ballpoint pens, and other things important to everyday life would face the maximum charge.
Now, there’s no proof (yet) that campaign contributions flowed after the tariff announcement or that lobbyists won this gaping loophole in the White House’s signature policy. Either way, we are seeing the first example of how a quest for exemptions will come to define this kind of mercantilist approach.
Because Trump claims the power to levy these taxes unilaterally through presidential emergency powers, the favor-seekers will go directly to 1600 Pennsylvania Avenue. The new imperial presidency meets the new billionaire politics.
Members of Congress, in other eras, set these rates, as they do other taxes. Here they are standing by, mouths agape. Still, some seem to have found a way to be part of the Great Barbecue.
According to The New York Times, Rep. Marjorie Taylor Greene’s recent financial disclosures reveal that she bought as much as $315,000 in stocks a few hours before Trump announced his reversal on overall tariff rates. (Members of Congress typically blame their financial advisers for this kind of lucky timing.) Greene is one of dozens of lawmakers from both parties who actively trade stocks while exercising power over vast sectors of the economy.
We can only expect more of this. What are the answers? Public financing of campaigns (first proposed by Theodore Roosevelt), full disclosure of big gifts, stronger curbs or even a ban on congressional stock trading, and emergency powers reform, for a start.
Those of us who care about the outsize role of money in politics should understand the import of this moment. People are always unhappy about the way big money dominates government, but they are just as often skeptical that anything can be done. At times, though, people get angry. When they see the unfairness and chicanery that can accompany transactional government, they have been stirred to action. Theodore Roosevelt said of the last Gilded Age that, sooner or later, there would come a “day of atonement.”
