Lessons From Trump's Near-Broke Campaign
On Saturday, Donald Trump issued an "emergency" appeal seeking $100,000 for his campaign "to help get our ads on the air."
This was odd for three reasons. First, according to his own commercials, the main premise of Trump's campaign was that he would pay for it himself. Second, Trump's campaign disclosure forms allege that his total net worth is ten billion dollars. To be clear, this is 100,000 times larger than his $100,000 urgent appeal. If Trump told the truth about his wealth, $100,000 for him would be the same as about 2 or 3 dollars for an average American. Third, his near-bankrupt campaign has paid out millions of dollars to Trump businesses and family members.
These facts add to mounting evidence that Trump has lied about his wealth. As Forbes recently wrote, "The Occam's razor explanation is that he's not worth $10 billion." Forbes should know, given the magazine's long track record of assessing the relative wealth of various billionaires. Just last year, Forbes concluded that Trump's $10 billion claim was "a whopper" of a lie. Indeed, experts suggest that the reason Trump refuses to release his tax returns because they will reveal the extent of his lies.
So how has Trump gotten away with lying about his business record?
In part, he's used lawsuits to deter people from poking around in his affairs. For instance, in 2009, Timothy O'Brien published a book reporting that Trump was a millionaire, not a billionaire, who had amassed less money than prior presidential nominees such as Ross Perot (roughly $3.9 billion) or Mitt Romney (roughly $330 million if you include the separate trust for his children). Trump sued O'Brien for defamation, as part of a broader legal campaign to ward off critics.
Unfortunately for Trump, he lost his lawsuit against O'Brien both at trial and on appeal, and in the process was forced to give depositions and even privately share his tax returns with O'Brien.
So, when the lies are pulled away, what information do we have about Trump as a businessman and a candidate?
First, Trump inherited his money.
Over four decades ago, in 1974, Trump's father gave him control of a company that was worth $200 million, and then provided additional loans and assistance over time. A finance professor at the University of Texas, who analyzed Trump's holdings since 1976, concluded that: "Trump has underperformed the real estate market by approximately $13.2 billion, or 57%." That bears repeating. Compared with average business performance in the real estate sector, Trump squandered billions of dollars over the course of his career.
Second, Trump is more grifter than a business leader.
As The Atlantic reported in 2011: "In financial circles, it's pretty well known that Trump is a deadbeat." While Trump has paid himself and family members out of campaign funds, he has repeatedly stiffed smaller vendors, destroying some mom-and-pop businesses that had previously survived for generations. He's also destroyed wealth by urging people to invest in failing businesses, such as Trump Mortgages; Trump Tower Tampa; Trump Ocean Resort Baja Mexico; Trump Taj Mahal; Trump Magazine; Trump World Magazine; Trump Steaks; the Trump Shuttle; and Trump University. In several of these projects, Trump was sued. He settled out-of-court with investors in some cases. With Trump University, tuition-paying students allege that Trump used fraud to dupe them into becoming customers. Each time a Trump company declares bankruptcy, his partners and investors are left holding the bag.
Third, Trump had strong ties to the Mafia when he was a real estate developer.
Pulitzer Prize-winning journalist David Cay Johnston, who has written a book about organized crime and gambling, has spent many years investigating the ties between Trump and the Mafia. In a lengthy story for Politico, Johnston "encountered multiple threads linking Trump to organized crime." These threads included openly seeking mob support to compete against real estate developers who refused to do so. This seems astonishing for a mainstream presidential candidate, but recall that unlike Trump's political rivals, Trump has aggressively used libel laws to prevent prior journalistic investigations of his money. Johnston's Politico story is well worth a close read.
Fourth, Trump's only "legitimate" money came from promoting gambling, sex, and violence.
When you take away the inheritance, the mob ties, the contract breaches, bankruptcy court, litigation threats, eminent domain, and fraud, what's left is Trump's role as a huckster. In 1992, Trump blamed Mike Tyson's rape victim for her rape, when Tyson's release would have boosted Trump's boxing-related revenues. In 1994, Trump spoke with Lifestyles of the Rich and Famous and speculated as to whether his then-infant daughter would develop attractive breasts. From the late 1990s onward, Trump built his name as a "reality star" by repeatedly demeaning women first on Howard Stern's radio show, then later on his television show The Apprentice. As the Washington Post summed it up, "Trump has made flippant misogyny as much a part of his trademark as his ostentatious lifestyle." Apparently, this brand appealed to the roughly 5 percent of eligible American voters who voted for Trump in the GOP primaries, but sleaze marketing is not much of a blueprint from which to strengthen America.
Finally, Trump's proposals would be a disaster for the American economy.
So what are the policy ideas of this so-called "businessman" whose only clean money comes from reality television? For starters, Trump has made it clear that he intends to extend the philosophy of "Deadbeat Donald" to the full faith and credit of the United States Treasury. During a recent interview with CNBC, Trump literally suggested that the United States should threaten bankruptcy to stiff owners of Treasury bonds. As analysts from the left, right, and center pointed out, this idea would trigger an immediate global economic crisis. This is because the world economy relies upon Treasury bonds as risk-free securities, to the benefit of global financial markets and the enormous benefit of the United States.
This is not the only economically catastrophic idea that Trump has proposed. Actual business leader Mitt Romney, the Republican Party's presidential nominee four years ago, explained that: "If Donald Trump's plans were ever implemented, the country would sink into a prolonged recession" by triggering a trade war with other nations. Trump's budget math does not remotely add up. His famous wall with Mexico would cost tens of billions of dollars to build and maintain, and no, Mexico will not pay for it.
Americans have roughly five months to learn about the "Deadbeat Donald" aspect of Trump's track record and policy ideas. If we do not learn that lesson by November 4, unfortunately we will learn it the hard way shortly thereafter.
A version of this post originally appeared on Medium.