Analysis

FOLLOW THE MONEY FROM RUSSIA TO TRUMP

One of the bigger unknowns about Donald Trump’s finances, without benefit of his tax returns, is how much direct or indirect investment in his business empire comes from Russian oligarchs and other former Soviet sources.

What is known, is that Russian money has kept some of his various development entities afloat and that may be one reason for his extremely favorable treatment of Russian President Vladimir Putin and Russian policies since the start of Trump’s campaign. Writing in Slate about “Putin’s Puppet,” Franklin Foer collected the history of what he called Trump’s slavish devotion to Russian leaders and investors going back more than two decades:

“Russians helped finance his projects in Toronto and SoHo; they snapped up units in his buildings around the world – so much so that he came to target them, hosting cocktail parties in Moscow to recruit buyers. (His tenants included a Russian mobster, who ran an illegal poker ring in the Trump Tower and accompanied Trump to the staging of the Miss Universe contest in Moscow.) Even when he built a tower in Panama, he narrowcast his sales efforts to draw Russians, as the Washington Post has reported. “Russians make up a pretty disproportionate cross-section of a lot of our assets,” Trump’s son, Donald Jr., bragged. “We see a lot of money pouring in from Russia.”

The Wall Street Journal (paywall) reports many U.S. banks have shunned Trump, but not the Frankfurt-based Deutsche Bank, which is a well-known conduit for money from Russian oligarchs, according to The New Yorker.

The Journal: “Other Wall Street banks, after doing extensive business with Mr. Trump in the 1980s and 1990s, pulled back in part due to frustration with his business practices but also because he moved away from real-estate projects that required financing, according to bank officials. Citigroup Inc., J.P. Morgan Chase & Co. and Morgan Stanley are among the banks that don’t currently work with him. At Goldman Sachs Group Inc., bankers “know better than to pitch” a Trump-related deal, said a former Goldman executive.”

Josh Marshall of Talking Points Memo concluded, “it is an open secret on Wall Street that none of the big banks will do business with Trump because he’s not trustworthy.

Trump’s most recent financial disclosure as a candidate, released in May 2016, shows that he owes at least $250 million to banks (Wall Street Journal blog Moneybeat). He has multiple loans of more than $50 million apiece from the German bank, according to an investigation by Mother Jones. That raises other questions:

“Two of those megaloans are held by Deutsche Bank, which is based in Germany but has US subsidiaries. And this prompts a question that no other major American presidential candidate has had to face: What are the implications of the chief executive of the US government being in hock for $100 million (or more) to a foreign entity that has tried to evade laws aimed at curtailing risky financial shenanigans, that was recently caught manipulating markets around the world, and that attempts to influence the US government?”

Russia has strategically supported right-wing populist and authoritarian parties in Eastern and Western Europe that tend to support Russian interests. This financial support could potentially prove disruptive to NATO cohesion and the Western consensus against an expansionist Russia. Among those getting Russian help are the French National Front and Marine Le Pen, former Italian premier Silvio Berlusconi, Golden Dawn in Greece, Ataka in Bulgaria, and Jobbik in Hungary, among some 15 right-wing political parties that are believed to have Russian support of one kind or another.

The New York Times has reported: “The Kremlin’s goal seems to be to sow division, destabilize the European Union and possibly fracture what until now has been a relatively unified, if sometimes fragile, consensus against Russian aggression.” Russian support for Trump fits right in with this pattern.

Foer concludes in Slate:

“A Trump presidency would weaken Putin’s greatest geo-strategic competitor. By stoking racial hatred, Trump will shred the fabric of American society. He advertises his willingness to dismantle constitutional limits on executive power. In his desire to renegotiate debt payments, he would ruin the full faith and credit of the United States. One pro-Kremlin blogger summed up his government’s interest in this election with clarifying bluntness: ‘Trump will smash America as we know it, we’ve got nothing to lose.’ ”

Former Secretary of State Madeline Albright told Business Insider: “Vladimir Putin could not dream up a better presidential candidate than Donald Trump to help him move his grand vision forward.”

Albright, who supports Hillary Clinton, listed some of the reasons why the Kremlin would favor Trump: “Donald Trump, beyond just praising [Russian President Vladimir] Putin, has defended his most unacceptable behavior and proposed a series of pro-Kremlin policies,” adding that Trump would be open to easing sanctions on Russia and recognizing the country’s annexation of the Crimean peninsula in Ukraine. “He has stoked European disunity, celebrated Brexit, and casually predicted the break-up of the European Union,” Albright said. “[He] even encouraged Russian espionage in a US election.”

Sources: Slate, Wall Street Journal (paywall), The New Yorker, Talking Points Memo, Mother Jones, The New York Times, Business Insider