Two new twists have emerged in the battle between Donald Trump and Joe Biden for the US presidency.
First, the reasons that drove an unprecedented wave of donations to the Trump campaign once he was convicted of an offence in the courts.
Second, both sides are attacking each other on the basis that their opponent has some form of dementia and is therefore unfit to govern. Such allegations against Biden are old, but it’s a new weapon against Trump.
Until the court decision, the Biden campaign had beaten Trump in fundraising.
At the end of April, the Biden campaign had a record $US192m cash-on-hand, compared to the Trump campaign’s $US93m. But Trump had narrowed the gap in April.
On May 30 Trump was found guilty of criminal charges. In the 24 hours after that historic verdict was announced $US53m poured into the Trump accounts lifting the May total to $US141m.
But the money kept coming, and by adding the first week of June the May total appears to have risen to around $US200m.
A third of the $200m came from small donations, but suddenly much of America’s rich, led by billionaires, moved their money behind Trump.
In the media the most popular reason given for the flood of money to Trump was that he would deliver lower taxes and regulations. But that explanation does not explain why the guilty verdict triggered the money rush.
What drove the money was the precedent created by the verdict, which rang alarm bells around sections of the business community.
To understand that alarm it is necessary to look at exactly what was contained in those 34 guilty verdicts.
The case involved an alleged $130,000 “hush money” payment that Trump’s lawyer, Michael Cohen, made to adult film star Stormy Daniels prior to the election. This payment, it was alleged, keep voters in the dark about Daniels’ allegation that she had sex with Trump years earlier, which he denies.
But the actual charges that Trump faced did not embrace the sex allegation. Instead, each of the 34 charges solely dealt with the comparatively mundane commercial paperwork that was generated when Trump paid his lawyer so-called “retainers”.
Trump’s lawyer was paid in a series of monthly payments of $35,000 over the course of 2017.
The first cheque was for $70,000, covering two months. The lawyer sent an invoice to the Trump organisation for each cheque stating the payment as his “retainer.”
Every time the lawyer was paid, a bookkeeper generated a record for the company’s files, known as a voucher, with the description “legal expense”.
Each of the 34 charges against Trump corresponded to the cheque, invoice and voucher generated to “retain” Trump’s lawyer. They were 34 simple commercial transactions which each triggered a guilty verdict.
Prosecutors said Trump knew the payments were to reimburse his lawyer for the Daniels payment, not for his legal expenses. They relied on handwritten notes that set out the reimbursement and the calculation.
Accordingly, Trump was declared guilty of the crime of falsifying business records
Under New York State law, falsification of business records is a crime when the records are altered with an intent to defraud. To be charged as a felony, prosecutors must also show that the offender intended to “commit another crime” or “aid or conceal” another crime when falsifying records.
In Trump’s case, prosecutors said that “other crime” was a violation of a federal election law that makes it illegal for “any two or more persons” to “conspire to promote or prevent the election of any person to a public office by unlawful means”.
A Trump defence was that the payments to Trump’s lawyer were not reimbursements for the Daniels payment. He is appealing the verdict.
Many of those who donated to Trump saw a dangerous precedent being created by what happened to him. Seven years after a commercial transaction in state law, it was being declared a crime alleging breach of federal law.
In Trump’s case it was electoral law, but the same could be applied to environmental and other laws — many of which will have changed over a seven-year period and can create emotion in a courtroom.
If Trump becomes president eliminating that precedent will be one of his first actions. The money flowed.
Election analysts say that because both Biden and Trump are well known to voters the impact of the money mountains behind each candidate will be less than if lesser-known people were candidates.
What might be more important in the campaign are stumbles that Biden and Trump might make. American voters are very familiar with the Biden stumbles, so mistakes in the debate in and other areas will reinforce earlier views.
But Trump has always appeared as strong and resolute in his campaigning.
To suddenly have a social media site picking over his actions every week looking for signs of some form of dementia is a totally new aspect to the campaign.
It’s a minor matter at present but given much of the media will be supporting Biden, it will become a significant issue if too many mistakes are made by Trump.
To have an election campaign in the middle of a set of court cases must place enormous strain on Trump, so he is vulnerable.
More Coverage
Why buying and holding shares trumps US election winner
In terms of your portfolio, it doesn’t matter who wins the US election, says Barefoot Investor. What does matter is that you buy and hold shares and weather the political storms.
Do we need a US-style retirement savings system?
The federal Opposition has mused about a US-style retirement plan for Australia but although self-managed super funds are far from perfect, do we really need America’s so-called 401(k)?