Written by Ashraf Shaikh
Here’s how the current actions of Donald Trump are a literal scam — the target of that scam is us, the taxpayer. The benefactor is, as always, Trump and those he likes.
A few baseline facts:
Here are the steps to the scam:
- Trump used a verbal line item veto (deemed unconstitutional by the SCOTUS since 1998) on the $2T stimulus bill, saying he would not abide by the oversight required in the text. This oversight was the only reason Dems agreed to the large percentage of corporate bailout money, i.e. so Trump would not just direct that money to his own businesses and friends’ businesses.
- Trump has claimed the authority to determine which businesses get awarded stimulus-related contracts.
- Friends and donors of Trump stand up companies or repurpose old companies through which tax money can be funneled. This leads to ridiculousness like a 3 week old company founded by a Republican donor now being the center of medical supply distribution in the US, or a bankrupt military training company with no history in providing medical supplies and zero employees since May 2018 being awarded a no-bid $55M contract to provide masks to the government at over 7 times the cost per mask that well established companies like 3M are charging.
- The feds sell the supplies from the federal stockpile and the supplies seized from various states and countries to the distribution companies at a reduced rate
- The states then have to bid on these supplies, driving up the price that the distributors are able to pocket
- FEMA is spending taxpayer dollars to ship in supplies by plane from China in 2-3 days vs the normal 20-40, which by itself is not bad, until you realize these supplies are going to be given to the commercial distributors to put out for bidding by the states. In other words, Trump is using taxpayer dollars to express ship supplies to a commercial company who will be making a profit selling these supplies
- Trump is retaliating against companies that refuse to take part in his streamlined scam
As a result of the above, states are having to smuggle in PPE from China via methods like sending their state’s NFL team’s jet to China to pick them up in person, and then having state police escort them to hospitals to prevent them from being seized by the feds. Even when states are sending each other supplies, they need to be escorted by state troopers to protect them from the federal government, like when Massachusetts sent 300,000 masks to NYC and 3 states (MA, RI, CT) banded together to escort the supplies so they couldn’t be seized by the federal government. Think about the ridiculousness of that for a second. Individual states are having to protect needed supplies from seizure by the federal government.
In summary, we have the following situation:
- Trump made a deal with Dems so that the stimulus money would be subject to oversight, and then openly declared his intention to ignore said oversight.
- Trump has claimed the power to direct which companies get contracts related to coronavirus relief efforts.
- His donors and friends have stood up medical companies to be able to receive these contracts.
- Trump has directed the federal government to seize masks bound for other countries, and to seize supplies directly from hospitals.
- The federal government then sells these supplies to companies that Trump can unilaterally choose, at a discount.
- These companies also benefit by having Trump use taxpayer funds to express ship supplies from China to the US for distribution via government contracts that Trump personally awards.
- These companies then sell supplies via a bidding process to states, driving up prices, and pocketing the difference.
- This causes a shortage of supplies in states that need them, leading to some states getting creative in procuring supplies.
So, does anyone think this is in any way defensible?