Donald Trump’s identity crisis

How the former president’s campaign abandoned its populist roots.

The Democratic National Convention in Chicago went about as well as the party faithful could have hoped. A much-prophesied repeat of the violent 1968 convention, also held in the Windy City, didn’t come to pass. Representative Alexandria Ocasio-Cortez, tribune of the young progressives, urged leftist docility, notwithstanding disagreements with the party mainstream over Gaza. Pro-Palestinian protests nearby proved small and ineffectual.

An indigenous land acknowledgement or two aside, issues of identity politics were muted compared with four years ago. All living Democratic ex-presidents bestowed their blessing. The vice-president nominee Tim Walz energised the audience by articulating the combination of modest economic welfarism and sexual liberalism that forms the party’s current ideology. Never a star orator, the woman of the hour Kamala Harris delivered a fine enough speech.

In short, Democrats effectively, if vaguely, reassured the party’s base coalition that they would continue to deliver the goods. This, even as they sought to win over independents and affluent suburbanites in battleground states by vowing to back Ukraine and Nato – and by memory-holing Harris’s support for 2020’s crazier causes, such as public health insurance for illegal migrants and defunding the police.

Time will tell if the pitch succeeds at the ballot box. But it already bespeaks serious political talent, and anyone who still insists Harris’s extended honeymoon is thanks only to media favour is in denial.

This apparently includes Donald Trump, who on Thursday took precious time from campaigning to… launch a cryptocurrency market called the DeFiant Ones. “For too long,” he wrote on his Truth Social platform, “the average American has been squeezed by the big banks and financial elites. It’s time we take a stand – together. #BeDefiant.” (The “DeFi” in the brand name is in reference to “decentralised finance”.)

The crypto scheme recalls his classic grifts, such as Trump University. The arbitrary power of financial institutions to de-bank people is a serious problem. But tech bosses are loath to see public regulation used to rein it in, since this could also curb their own gross market power. Their “solution” is an unregulated, Ponzi-like class of financial assets whose growth would, incidentally, fatten Big Tech wallets.

Above all, the DeFiant Ones launch was symptomatic of a campaign that has been flailing for more than a month, ever since President Joe Biden bowed out of the race and crowned Harris. Expecting to trounce an unpopular and semi-senile 81-year-old, Team Trump has struggled to define the new opponent as either a “communist” threat to mum and apple pie, or a hollow representative of a failed elite that must be overthrown.

The trouble with defining Harris reflects the Trump campaign’s own identity crisis: is Trumpism still an uprising against elites and the American status quo in the opening decades of the 21st century? Or is the movement settling into familiar conservative patterns, battling “communist” phantoms, allying with powerful segments of American capital and abandoning a post-neoliberal trend first heralded by Trump himself in 2016?

Evidence is mounting in favour of the second proposition: that Trumpism 2.0 is more conservative than radical or populist. The most telling sign is the decision to frame Harris as a “communist” for promising to combat corporate price-gouging in the food industry. Whatever the merits of her proposal, the fact is even some of the reddest of red states boast anti-gouging laws. Richard Nixon, Trump’s closest spiritual predecessor in the GOP, implemented extensive price controls.

Characterising such measures as “communist” harks back to the dumbest, most boring version of the post-Reagan right – the stuff of a Nikki Haley campaign. And it feels like a repudiation of all that made Trump attractive to working- and lower-middle-class voters the first time around. What happened to the Trump who lambasted corporate bosses and suggested the state should take care of ordinary people, even if it meant violating the GOP’s sacred market orthodoxies?

The shift from populism to conservatism can be attributed, partly, to the success of Trumpism 1.0 in shaking up the post-Cold War consensus. In 2016, Trump’s opposition to neoliberal globalisation and free trade shocked the centre. Fast-forward eight years, and his critique of globalisation has attained the status of conventional wisdom among the establishment.

Team Biden widened Trump’s tariffs on Chinese goods and complemented them with a raft of industrial strategies aimed at ensuring domestic manufacturing independence, especially in the semiconductor and green sectors. On antitrust, the Biden administration this summer successfully concluded a case against Google that was launched under Trump. Bidenism, as I have argued in these pages, in many respects represented continuity with Trumpism.

Important differences persist, most notably on immigration. As the Republican nominee for vice-president, JD Vance, told me in February in an interview for the New Statesman, the Biden administration refused to see open borders as an element of neoliberalism that helps firms “do the same things with cheaper and cheaper labour”. But even on that issue, Harris is now presenting herself as a long-time hawk. It’s an implausible claim, but the rhetorical concession to border discontent is notable all the same.

The point is that today, scepticism regarding what used to be called the Washington consensus is priced in. Centre-left establishments on both sides of the Atlantic have accepted its necessity, not least from a national security perspective. But this very success leaves Trump in a tough bind.

“Part of 2016,” the Republican strategist Ryan James Girdusky told me, “was the waning Obama years” – an era associated with the financial crisis and bank bailouts engineered by Obama’s team of Goldman Sachs alumni. But 2016 is ancient history in electoral terms. Where can Trump stand apart as a populist now?

One answer would be to lean in hard into a pro-labour, anti-corporate stance. This would entail defining Harris not as a “communist” but an Obama-style neoliberal Democrat. In so far as she refuses to speak out in any detail on political economy, the charge could have some potency. As the anti-monopoly writer Matt Stoller warned in the lead-up to the Democratic National Convention, there is reason to fear the influence on her campaign of the Dems’ own oligarchic wing, which would prefer to see the dismantling of tariffs and the firing of the likes of Lina Khan, Biden’s crusading antitrust tsar.

Yet Trump has declined to go down this path, instead promoting the laughable notion that Harris is in thrall to Marx and Lenin. Which brings us to the second factor behind the Trumpian shift from populism: namely, Trump’s dependence in this election cycle on a coterie of tech billionaires, especially Elon Musk. Hostile to any effort to bring markets under political control, these men seek to re-channel Trumpism’s economic energies into strictly culture-war grooves.

When he ran in 2016, Trump could count on his own finances to float his life and campaign to a large degree. This time, he faces huge liabilities as a result of the legal cases lodged against him. Some of these amount to little more than spurious lawfare. Still, taken together, they pose a deadly risk to Trump’s finances, which, by billionaire standards, were sketchy to begin with. It’s also possible Trump has resolved that extending his reign requires moving in tandem with a faction of elites. He might have wearied of Trump Alone Against the World.

Either way, the result is (again) the neutralising of his movement’s most radical economic impulses and a reversion to conventional conservatism, only now garbed in Musk’s edgy race memes and Trump’s own obnoxious rhetoric.

An especially painful moment came this month, when, during a conversation with Musk hosted on X, Trump jocularly praised the Tesla boss for firing striking workers. The Teamsters union president Sean O’Brien, who made history by becoming the first leader of his organisation to address the Republican National Convention, was forced to denounce the pair for waging “economic terrorism” against workers.

The billionaires’ takeover has also forced Trump to backtrack on some of his signature issues. In April, Congress enacted a law banning TikTok unless it ditches its Chinese ownership within a year. The measure was perfectly Trumpian, combining hostility to Beijing with scepticism of Big Tech. Except Trump himself opposed it on incoherent grounds. It didn’t escape notice that one of his big backers, the libertarian investor Jeff Yass, holds a minority stake in TikTok estimated to be worth $33bn as of March 2024.

Even on immigration, Trump is sounding curiously neoliberal. He recently claimed that artificial intelligence means “we need more people” and thus more immigration. Earlier, he pledged green cards for all foreign university students upon graduation, even those finishing two-year programmes. “Unbelievable,” as a veteran anti-immigration activist in Washington told me at the time – but it’s all too believable when you consider tech barons’ need for a cheaper class of workers.

To be sure, Trump proposes to slap a 10 per cent universal tariff on all goods imported to the US, and his defence of entitlement programmes such as Medicare and Social Security sets him apart from bog-standard conservatism. Still, something is off about his message, as even ultra-Maga personalities such as Chris Ruddy, Trump’s friend and the CEO of the pro-Trump Newsmax network, have noticed.

The third and final factor behind this transformation is more historical: American populist movements going back to the 19th century have often struggled to articulate a reformist governing agenda once they have managed to unsettle the establishment or smash hostile institutions.

The classic template was supplied by Andrew Jackson, who won the presidency (and founded the Democratic Party) by appealing to southern and western farmers, north-eastern proletarians and rising entrepreneurs – against the established eastern “money power”. The Second Bank of the United States became the symbol of this power in the eyes of the Jacksonians. The bank was indeed an imperious institution, meddling in politics and resisting popular control (even though taxpayers provided a fifth of its capital). But it also did a decent job of disciplining the flow of capital in the young republic.

President Jackson expended enormous energy trying to take it down and finally succeeded – but without having put in place an alternative. The result was a brief spell of depression and inflation, and nearly a century of banking and currency chaos that spared comparable European states with more stable and centrally managed systems.

Something similar may be happening with Trumpism. Having scared the establishment about the wages of neoliberalism and secured concessions, Trumpians are now struggling to formulate a governing agenda. Hence, the reversion to standard-issue calls for deregulation and the attempt to frame the Democratic campaign as “Marxist”.

Here is the thing, though: Trumpism 2.0 might still work as an electoral pitch. While Harris enjoys a small national polling advantage, American contests are won at the margins in a handful of states. Indeed, the 2024 race might come down to a single state, Pennsylvania, where Trump and Harris are tied and where many dynamics – inflation, the state’s fracking economy, law-and-order anxieties – are unfavourable to Harris.

Girdusky, who is notoriously pessimistic about his party, put Trump’s overall chance of winning at 65 per cent. Another senior GOP strategist, who asked to comment anonymously given his proximity to the Trump campaign, was similarly positive over the issues driving this cycle: “Dissatisfaction with the economy is extremely high. The economy has always been the number-one issue. And immigration has jumped up to number two, something unprecedented.” Both are uphill battles for Harris.

If Donald Trump does end up losing, however, few will have the patience for his inevitable and baseless whining about Democratic “cheating”. He would only have to look into the mirror – and behold a meaner Mitt Romney or Nikki Haley staring back at him.