Real Corruption

Mick “Pay and We’ll Talk” Mulvaney

Richard Eskow

It’s not just that Mick Mulvaney has no scruples; he has no shame.

It has become commonplace to see Trump administration officials, up to and including the president, abuse public resources for personal gain and comfort.

But private planes, $31,000 dining room sets, and other lavish expenditures at public expense are the petty rewards of narcissists. The corruption that matters most is the kind that  hurts millions of Americans to enrich the tiny class of billionaires that is this regime’s true constituency.

When it comes to this kind of deep corruption, which perverts government’s role for the benefit of the privileged few, Mick Mulvaney is a master of the art. In fact, he’s made it his ideology.

Mulvaney’s Way

Mulvaney is Trump’s Budget Director. He is also doing double-duty as head of the Consumer Financial Protection Bureau (CFPB), the agency created  under President Obama to protect consumers from being ripped off by predatory and criminally-inclined banks.

As a member of Congress, Mulvaney once called the agency he now leads “sick, sad,” and a “joke.”

Even if Mulvaney uses his position at the CFPB to serve banks, it’ll still cost them. He pretty much said so, in a speech he recently gave to the American Bankers Association.

“We had a hierarchy in my office in Congress,” Mulvaney told an audience of 1,300 bankers and loan company executives. “If you’re a lobbyist who never gave us money, I didn’t talk to you. If you’re a lobbyist who gave us money, I might talk to you.”

That’s a vision of play-for-play government, and it’s a vision Mulvaney shares with Trump, his party, and other members of his administration.

“As a businessman and a very substantial donor to very important people,” Trump said in 2015, “when you give, they do whatever the hell you want them to do. As a businessman, I need that.”

Deficit Shrike

Mulvaney is not just a play-for-pay servant of the banker class, although he is clearly that. He is an economic extremist whose ideology demands that the poor and middle class be sacrificed on the altar of wealth. That’s why he wants to cut Medicare and Social Security, as well as programs to benefit the poor.

As Budget Director, Mulvaney has continued the ideological bait-and-switch he developed as a Tea Party Congressman and co-founder of the so-called “Freedom Caucus.” In Congress, he became known as a “deficit hawk.”

Mulvaney railed against government deficits whenever progressive programs came on the block – despite the growing number of economists who say federal deficits don’t matter, at least in the way most conservative policymakers believe.

But Mulvaney switched his tune about deficits as soon as the opportunity arose to give money away to the rich. “I’m really not interested in how tax reform handles the deficit,” Mulvaney told CNBC. 

Pay-to-Play

Paying for access has been a feature of our broken political system for a long time. In a little-noted comment to the Philadelphia Inquirer editorial board, candidate Hillary Clintonsaid this in 2016:

I’ve gotten so many donations over so many years that and I’m very grateful for… there have been many (instances) where people have said, ‘Would I look into this.’ I always say I will look into something, but I always tell people there is no guarantee that if I look into something that you are going to like my answer, and that’s been my practice.

Clinton’s comments make plain that in politics, whatever your party, money buys access – if not guaranteed compliance. Her remarks reflect a status quo in the United States that is built around big-money campaign contributions. They bear a strong resemblance to Mulvaney’s, and provide further evidence that our campaign finance system is broken and corrupt, across party lines.

But Mulvaney’s version is even worse – because he was openly shaking down an entire industry for money in real time, and in public. That became even clearer when he went on to say that these cash-driven attempts to sway government officials were among the “fundamental underpinnings of our representative democracy.”

“And,” added Mulvaney, “you have to continue to do it.”

Government, C.O.D

So Mulvaney spelled out for bankers how the wheels get greased in Washington. How well has he delivered for his pay-to-play clients?

He was instrumental in passing the Trump/GOP tax cut bill, which is a massive wealth giveaway to the richest Americans. And when a “gimmick” was needed to push the bill through (that was Mulvaney’s term for it), the middle-class cuts were made temporary. The corporate tax cuts were made permanent, to protect gains for wealthy shareholders.

His obsession with cutting deficits was quickly discarded, as we’ve already seen.

As acting head of the CFPB, Mulvaney has served Wall Street with more alacrity and enthusiasm than a waiter at Delmonico’s during Friday night Happy Hour.

He shut down the Office for Students and Young Consumers, despite the fact that 44 million Americans owe roughly $1.5 trillion in student debt. As Americans for Financial Reform points out, that office has returned $750 million to borrowers, helped address 50,000 complaints, and provide information to student borrowers.

Closing it leaves borrowers with fewer defenses against predators in the banking industry and in loan servicers like Navient, the privatized student loan servicing company. An ethics investigation found that Education Secretary Betsy DeVos had financial interests in this area.

The bill Mulvaney helped engineer netted the country’s six largest banks an estimated $3.6 billion in tax giveaways last quarter alone, according to the Associated Press. Their further enrichment is all but assured, now that Mulvaney has put a freeze on hiring and suspended rule-making at the agency. 

Enforcement actions are at a standstill.

Payday Predators

Mulvaney has been very kind to the payday lending industry, an especially predatory form of capitalism that preys on lower-income and minority communities. 

The industry specializes in luring customers into repeated short-term loans at rates that can exceed 400 percent annually. The CFPB had proposed rules to rein in this legalized usury, and Mulvaney is doing everything in his power to stop the implementation of those rules.

Payday lenders and their friends in government insist that they perform a useful function by providing banking services to the “unbanked.” That’s not true. There are other ways to meet the needs of the unbanked, including postal banking. A survey was taken after North Carolina banned payday banking, and “at a two-to-one ratio, former borrowers report that they are better off now that it’s gone.”

In a major win for consumer activists, Congress has now backed away from a bid to undothe CFPB’s final rule for payday lending and other high-rate loans. In a reflection of money’s corrosive political influence, that bid was introduced by a “bipartisan group of lawmakers.”

But this only increases concern that Mulvaney, who received tens of thousands of dollars from payday lenders while in Congress  and has already ended the CFPB’s probe of payday loan collectors,  will abuse his position at the CFPB once again for his benefactors.

Rough Water

Mulvaney appointed Eric Blankenstein, an attorney who opposed the CFPB in court, to a senior CFPB position. As the National Law Journal notes, Blankenstein came to the Trump Administration last September after spending eight years at white-shoe law firm Williams & Connolly.

Before joining the Trump Administration, Blankenstein represented TCF National Bank against the CFPB. The agency found that Blankenstein’s client had systematically tricked customers into accepting overdraft charges on ATM withdrawals and bank card use. The CFPB found that TCF had offered its employees up to $7,000 in bonuses for getting customers to accept the charges.

The program was so successful at bilking customers that the bank’s CEO reportedly named his boat the “Overdraft.”

That CEO is the kinds of person the Trump administration, and the entire Republican Party, exists to serve. And when that happens, working Americans pay a price.

In Mick Mulvaney’s case, Americans will pay every time their bank rips them off – in overdraft charges, foreclosures, short-term loans, and in ways yet to be determine. Bankers will buy more boats, while working Americans remain underwater.

And that’s the real corruption.