Former House Speaker John Boehner and a clutch of billionaires mingled in the green room backstage at the annual SALT conference in Las Vegas, but none of them was the main attraction. Instead, the man everybody wanted to see was a serial banker who has stayed far out of the limelight – until recently.
Steve Mnuchin sat quietly at the end of a long table, in a dark suit with no tie, chatting quietly with a parade of financiers who stopped by. Mnuchin wasn’t on the speaking agenda at SALT, but he suddenly had a more important gig – finance chairman for Republican presidential candidate Donald Trump’s campaign.
That new role may explain why Mnuchin was at SALT in the first place. Trump has mostly self-funded his campaign so far, with individual donors contributing about one-fourth of the $48 million Trump has spent. And Trump has had no super PAC able to raise unlimited funds from wealthy donors to spend on his behalf, or on negative advertising aimed at an opponent.
But Trump will need way more money to run a competitive campaign in the general election – possibly $500 million to $1 billion. That’s why Trump has said he’ll accept outside financing – and appointed Mnuchin to oversee that. "He's a very accomplished guy," says Anthony Scaramucci, founder of Skybridge Capital, which organizes the SALT conference every year. "He's an entrepreneur, built a fund, he was a partner at a big investment bank. This is the kind of guy you can recruit into a Trump administration."
Mnuchin is a former partner at Goldman Sachs (GS) who has run his own hedge fund, Dune Capital Management, since 2004. His father, Robert Mnuchin, was head of stock trading at Goldman, and is now a well-regarded art dealer. So the younger Mnuchin, while not as well-known as financial titans like Jamie Dimon or Bill Ackman or Ken Griffin, clearly knows his way around Wall Street.
Many in the finance industry are still puzzling over Trump, who has criticized hedge-fund managers for “getting away with murder” on account of low tax rates, and proposed free-trade restrictions that could severely hurt the bottom line of many big companies. But there’s no other candidate for big donors to give to, other than Hillary Clinton. And so far, big donors have given $400 million to Republican candidates who flamed out.
There’s more where that came from, and Trump will likely grab some Wall Street money – especially since he's now setting up his own super PAC. Scaramucci says he'll work with Mnuchin to set up the nationwide fundraising effort Trump will need to take on the Democratic nominee, most likely Clinton, state-by-state. "You've got to get enough money to get the opportunity to win," Scaramucci says. "You need the money to power that up." Scaramucci backed Scott Walker and Jeb Bush earlier in the campaign, but says Trump is his guy now. A bunch of his hedge-fun pals may be making the same transition.
More from the SALT conference:
Hedge fund titans warn of financial crisis-like market signals
Obama's former economic advisor calls Trump's debt idea 'borderline insane'
Boone Pickens: I support Trump and his plan to ban unvetted Muslim immigrants
A baron of finance scolds his fellow 1 percenters
Billionaire Rubenstein: These 6 characteristics will make a young person successful on Wall Street
Rick Newman’s latest book is Liberty for All: A Manifesto for Reclaiming Financial and Political Freedom. Follow him on Twitter: @rickjnewman.