Donald Trump and the rise of the self-financed billionaire candidate

Why the mega-rich are primed for an even larger — and more hands on — role in U.S. politics

Donald Trump to an unconventional route to his presidential candidacy.
(Image credit: AP Photo/Carlos Osorio)

So it's 2016 now. And it seems we can ring in the New Year with Donald Trump's declaration that he's going to spend $2 million a week on TV ads from here on out.

The idea of the self-financed plutocratic presidential candidate has been floating around the national discussion for a while now. But Donald Trump in 2016 may finally deliver the proof of concept.

There are a few reasons for Trump's decision. For one, while he still dominates in Republican polling, Cruz and Rubio ate away at his lead over the last two months even as Carson deflated. Two, as much fun as it's been watching the GOP debates and Trump's slow slide into proto-fascism, we haven't actually had any state primaries yet. That process is about to begin in earnest, so everyone and their respective campaigns will have to knuckle down and start getting real.

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Of course, that the Republican campaign so far has occurred entirely within the arena of the media provided a huge implicit subsidy to Trump's campaign efforts. It put Trump's brand front and center in the national discourse at remarkably little cost to the candidate himself. As of December of 2015, Trump's campaign had spent a mere $5.6 million. That's compared to the $14.5 million dropped by Jeb Bush's campaign, and another $50 million spent by his super PAC, all to little effect. Trump's spending is also a weird hybrid of money from his various business ventures, around $1.8 million he personally loaned his campaign in the second quarter of this year, and another $3.9 million from donors.

All this certainly means he can self-finance: $2 million a week would be in line with Trump's willingness to drop $100 million of his own money on the campaign. And even if you take the low-end estimates of his net worth, he could do it. But Trump's billionaire status also let him enter the Republican contest with already-established cultural clout and a ready-made brand. So he's actually had to spend less than his rivals even as he maintains the capacity to spend more.

The next key point is he can do all this without any aid from the Republican establishment or party infrastructure. As Trump keeps reminding everyone, he is beholden to no one. So he's been able to capture 35 percent of likely GOP voters, even as he stands GOP orthodoxy on its head. He's eschewed hardline supply-siderism and openly indulged racism and xenophobia much more than any other candidate.

This brings us to the part where the Trump phenomenon stops being about Trump specifically, and starts stretching out into something much bigger — and potentially, another 2016 watershed.

Billionaires sponsoring a pet candidate are nothing new, and the roster of potential mega-wealthy backers for this year is impressive. But the new thing that 2016 may bring about is that these backers have seemingly become distinctly unhappy with their candidates.

Billionaire Charles Koch, generally a right-wing stalwart, has said that while he'll help the Republican Party in the general, he has no desire to pour his money into a particular candidate in the primary. And a recent piece by Gabriel Sherman in New York Magazine shared a remarkable anecdote in which Daniel Loeb — a New York hedge fund manager, and part of the group of mega-donors that collectively handed Karl Rove's super PAC $117 million in 2012 — was so infuriated by the Republican implosion that year that he considered suing Rove's operation for investor fraud. There's something hilarious about a financial master of the universe thinking he can approach a political campaign like any other business deal. But as Sherman laid out, Loeb is not alone in his displeasure. And that displeasure is changing the way the wealthy approach their relationship with politicians.

Robert Mercer, a computer scientist and hedge fund billionaire who has dropped $30 million on various super PACs supporting Ted Cruz, is also the owner of a political data firm. He's bringing the firm's methods to bear on how the super PACs operate, and shunning TV ad buys for radio, internet, and field organizing. Chicago Cubs owner Joe Ricketts and winemaker John Jordan each have their own super PACs and staff, applying methods and approaches to ads that these men shape themselves. Other wealthy players are setting up their own operations that ostensibly support particular GOP candidates, but are also devoted to very specific projects, like digging up dirt on Democrats or stumping for corporate tax reform.

In other words, the standard relationship — in which the mega-wealthy give money, and then politicians and their professional coteries decide how to spend it — is collapsing in favor of a new model where the donor class takes a much more hands-on approach. Which raises the question: If the donor class is insisting on making more of the decisions itself, and if they have the raw financial capacity to bankroll their own campaigns anyway, how long until they just cut out the middle men entirely and start running for office themselves, a la Trump or Michael Bloomberg?

This has the capacity to upend the established habits of American politics. Like all groups of voters, the rich are actually a weird mutant mix of leftwing and rightwing impulses, sometimes taking those impulses to far greater extremes than is sanctioned by the DC establishment bubble. That in turn could activate normally dormant or uninterested constituencies. Again, Trump is a good example of this: His particular mix of politics is appealing to poorer white voters in the south and industrial north who identify as Republican, but might actually vote Democrat under different circumstances.

Nor is this a phenomenon limited to conservative politics: Rumors are flying that Tom Steyer, the California billionaire who started the environmental group NextGen Climate, is going to make a run for the California governorship once Jerry Brown hits his term limit in 2018. Steyer has turned fighting climate change into something of a personal crusade, and has begun taking on the question of inequality as well.

Now, none of this is a done deal. Being able to bankroll campaign staffs and ad buys is one thing. Being able to run a successful get-out-the-vote organization is quite another, and pulling that off still arguably requires making nice with the established party infrastructures.

But Trump doesn't have to win in 2016 to make other billionaire activists take notice. He just has to make a serious dent. If he can demonstrate that a quixotic self-financed billionaire candidate is a model that can work, well then political life in America could get very interesting after 2016.

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