Authorities arrested Donald Trump's former top adviser Steve Bannon on August 20, 2020, as federal prosecutors accused him and three others of defrauding hundreds of thousands of donors fundraising for a wall on the US border with Mexico. Photo: AFP

In August 2017, I was sitting in Steve Bannon’s cluttered office in the West Wing of the White House, arguing with the presidential strategist about US policy towards China. Tariffs and tech restrictions wouldn’t do the US any good, I told him: the United States needed to revive the kind of science driver that won the Cold War and invented the Digital Age during the Reagan years. We mocked up a set of policy points for the Defense Department. A week later Bannon was fired by then White House chief of staff General John Kelly, for the offense of trying to sandbag the national Security Adviser General HR McMaster.

I was saddened to read this morning that Bannon had been arrested with three other men by the US Department of Justice for allegedly “defrauding hundreds of thousands of donors in connection with an online crowdfunding campaign known as ‘We Build the Wall’ that raised more than $25 million.” When “Shoeless” Joe Jackson pleaded out to cheating in the 1919 World Series, Charley Owens of the Chicago Daily News told him, “Say it ain’t so, Joe.” I want to ask Steve the same question. I’ll withhold judgment until he has had a chance to give his side of the story.

Bannon has been a friend for years. We both worked for Ted Cruz early in the 2016 presidential campaign, although Steve soon shifted to Trump with some deep-pocketed donors in tow. I interviewed him in these pages last June. In April 2019 I stood next to him at the inaugural public meeting of the Committee on the Present Danger-China, which I joined (and quit in protest after a month). In the audience was fugitive Chinese financier Guo Wengui (a/k/a “Miles Kwok”), a shadowy figure who, it later emerged, paid Bannon $1 million a year.

Bannon’s collaboration with the mysterious Mr Guo may be the source of additional legal trouble. Guo raised $300 million in a private offering earlier this year that is now under investigation by the FBI and the Securities Exchange Commission. Some banks have frozen the accounts of Guo’s company, GTV Media, which includes among its directors Bannon as well as China-basher Kyle Bass.

Our last few conversations ended acrimoniously. In May 2018 we both spoke at a conference in Budapest on the Future of Europe. I stopped by his palatial hotel suite, and he tried to convince me that a ban on selling US computer chips to China’s ZTE Corporation would lead to 50,000 unemployed engineers marching on Communist Party headquarters in Beijing. Somehow Bannon had gotten it into his head that China was ready to crack apart, and that all it would take is a sharp knock from the Trump Administration. I told him he was out of his mind.

I’ve heard the same arguments from others in the Committee on Present Danger circuit. Steve’s partner in GTV Media Kyle Bass tried to convince me that the growth in China’s M2 money supply (currency plus deposits) proved that its financial system was about to explode. I gently explained to Kyle that money supply reflects bank deposits, which are an asset, not a liability. Financial crises, I told him, are not caused by people having too much money in the bank.

Over the years Bannon has been accused of all sorts of unsavory things, including fascist proclivities (based on a passing mention of some European writers with a fascist background) as well as anti-Semitism (for no reason at all). I can attest that he is utterly guiltless of such associations; Steve has read a couple of pages of a thousand books, and picks up ideas with an eclecticism that is as charming as it is erratic. He has intellectual interests but no background, and he has the short attention span of a Goldman Sachs media banker, which he was for several years after leaving the navy. 

However violently I’ve disagreed with him, I never found a trace of guile in the man. He did a brilliant job during the 2016 Trump campaign, on the strength of one single insight about media: People trust what their friends send to them more than what they see on television or read (if they read at all) in the newspapers, so the best way to convince people is via social media. He was able to parlay a much smaller advertising budget than Hillary Clinton’s into bigger results by concentrating on social media rather than television.

When Trump was elected, I wrote: “Having thrown out the failed elite, Trump has the problem of governing with newcomers and outright amateurs…. Donald Trump could be a character in a Frank Capra film or a Sinclair Lewis novel. He is our generation’s incarnation of Bunyan’s pilgrim. I do not mean that as praise (I never liked Bunyan, as it happens). That simply is the kind of people we Americans are, or rather the sort of people we have become at two and a half centuries’ distance from our Revolution. We never have succeeded in training an elite. Whenever an American elite finds itself in power it chokes on its own arrogance. I cheered Mr Trump to victory in the last election out of disgust for the do-gooders and world-fixers of both the Republican and Democratic mainstreams. Now I wish him good luck. He’ll need all the luck he can get.”

Steve was one of the outright amateurs that materialized in Washington like Frank Capra’s Mr Smith, and fell out of the bus on the first bump. If the US authorities make the charges stick, it would be a sad epitaph for yet another failed hope.