Talking Points Memo: Low Dollar, Same Grift & The Art of the Screw

Low Dollar by Josh Marshall:

As I've learned more about Trump's business history it has reminded me of this description we got months ago from another New York real estate professional about Trump's MO ...

There is a personality type with a New York developer, one Donald learned from Fred when he carried his dad’s briefcase to acquisition meetings out in the boroughs and it goes like this:
Donald contracts for a service or good, or the acquisition of a piece of land for $1 million.
He then does not pay you
You ask Donald for your million dollars
Donald yells at you, basely, abusively, wholly out of character to the rich gentleman you broke bread with and made the deal with. He tells you that no, YOU owe him $200,000. Gives you no reason but screams how can you be such a son of a bitch to rip him off, how he’s going to sue you, expose you as a cheat, etc.
You’re off your pins, defensive. How could this be the guy who was so nice when he picked up the check at Per Se?
So, you compromise, because human nature avoids conflict, right? This is what he’s gaming you for because once you compromised, you’ve lost. You’ve inferred his premise that you have some complicity in the matter otherwise why would you compromise? You are on the defensive and will never get it back.
You offer $750,000 as a settlement, angry buy want it over and done with. He then sues you. Why, because you’ve already committed yourself to the loss. You volunteered to surrender your position and what will stop you from keeping going?
I’ve seen many a New Yorker settle things like this with Trump people for 5-10 cents on the dollar and then happy, even eager to keep doing business with them. Why? Because he got in their heads with this aggressively counterintuitive behavior.

* * *
It also tells you something about why Trump suddenly seems so unable to roll with the changing dynamics of the campaign. Coming off a weekend in which most GOP elected officials around the country are harshly criticizing his racist attacks on Judge Gonzalo Curiel, Trump is now overruling his own campaign and insisting that surrogates intensify their attacks on the judge. Pressed on whether this could possibly be a good idea, Trump shot back: "And I’ve always won and I’m going to continue to win. And that’s the way it is."

I win because I win and I will keep winning!

Unflinching self-assertion and aggression is basically the only game he knows.

The Full Article (June 6, 2016)

The Screw by Josh Marshall:

Remember that no major banks other than Deutsche Bank (and apparently only one division of DB) will do business with Trump anymore. They've all been burned too often. Trump's actual mode of operation is to cut sharp deals in which he wins and the counterparty gets screwed. If and when they sue, he digs in and tries to wait them out.

Remember the New York City real estate professional who I quoted Monday describing Trump's MO. But even more, listen to how New York Times business columnist Joe Nocera puts it: "In every deal, [Trump] has to win and you have to lose. He is notorious for refusing to pay full price to contractors and vendors after they’ve completed work for him. And he basically dares the people he has stiffed to sue him, knowing that his deep pockets and bevy of lawyers give him a big advantage over those who feel wronged by him."

The Full Article (June 8, 2016)

Washington Post (Wonkblog): Two New Studies Find Racial Anxiety is the Biggest Driver of Support for Trump

By Christopher Ingraham:

More to the point, "those who express more resentment toward African Americans, those who think the word 'violent' describes Muslims well, and those who believe President Obama is a Muslim have much more positive views of Trump compared with Clinton," Klinkner found.

In Klinkner's data, responses to questions such as "Do you think people’s ability to improve their financial well-being is now better, worse, or the same as it was 20 years ago?" and "Compared with your parents, do you think it is easier, harder, or neither easier nor harder for you to move up the income ladder?" had little effect on a person's preference for Trump or Clinton.

But,  Klinkner found, racial attitudes were highly determinative:

Moving from the least to the most resentful view of African Americans increases support for Trump by 44 points, those who think Obama is a Muslim (54 percent of all Republicans) are 24 points more favorable to Trump, and those who think the word "violent" describes Muslims extremely well are about 13 points more pro-Trump than those who think it doesn’t describe them well at all.

The Full Story (June 6, 2016)

WNYC: Trump, Self-Proclaimed Outsider, Was New Jersey Political Insider

By Matt Katz:

Yet Trump didn't win such powerful friends the normal way — by making political donations. He couldn't. As a casino owner, Trump was barred by state law from contributing to campaigns.

Instead, says David Cay Johnston, a journalist who covered Trump at the time, in exchange for the free pass Trump got from regulators, politicos got other perks. "There were favored seats at boxing matches or concerts. There were deeply discounted bills for people who had parties or weddings at casinos. There were limo rides to go to events. There are all sorts of things that Trump was in a position to do," Johnston said.

Once, Trump's attorney threw a birthday party on his yacht, the Trump Princess, for the wife of a pro-Trump Atlantic City mayor.

The Full Story (June 2, 2016)

AP: Trump University Model - Sell Hard, Demand to See a Warrant

By Jeff Horwitz and Michael Biesecker:

Those who bought into Trump University ended up paying as much as $34,995 for what was purported to be private mentoring with supposed real estate experts — some of whom Trump himself later acknowledged were unqualified.

"It's fraud. ... straight-up fraud," said New York Attorney General Eric Schneiderman during an MSNBC interview on Thursday morning. Schneiderman is suing Trump over Trump University in separate but similar case. "He was clearly in charge of pitching this scam university to people."

With past Trump-affiliated business failures and controversies, Trump has often distanced himself by noting that his only financial involvement was a branding agreement. In the case of Trump University, however, Trump's ownership is not in dispute — Trump wanted the business for himself.

When future Trump University President Michael Sexton pitched Trump on the deal, he wanted to pay Trump a flat fee in a licensing deal. Trump rejected that, Sexton said in a deposition.

Trump "felt this was a very good business, and he wanted to put his own money into it," said Sexton, who ended up receiving $250,000 a year from Trump to run a business in which Trump held more than a 90 percent stake. The design of the Trump University operating agreement "was entirely in the hands of the Trump legal team," Sexton said.

The Full Story (June 2, 2016)

The Belly of the Beast: Trump and the Rule of Law (Parts 1 & 2)

Part 1 by Steven J. Harper:

“I have a judge who is a hater of Donald Trump,” the presumptive Republican presidential nominee shouted at a political rally in San Diego on May 27. “He’s a hater. His name is Gonzalo Curiel.”

On cue, the crowd booed.

“He is not doing the right thing,” Trump continued. “And I figure, what the hell? Why not talk about it for two minutes.”

There were several reasons for him not to talk about it, including 18 U.S.C. Sections 401 and 1503 of the criminal code, but we’ll come to those shortly. He then rambled on about the judge for eleven more minutes.

“We’re in front of a very hostile judge. The judge was appointed by Barack Obama. Frankly, he should recuse himself because he’s given us ruling after ruling after ruling, negative, negative, negative.”

That’s Trump. If you don’t agree with him, you’re wrong. Greatly, hugely, bigly.

“What happens is the judge, who happens to be, we believe, Mexican, which is great. I think that’s fine.”

Trump knew that the crowd was ripe for his characteristic mixed-message ethnic pitch (“Mexican – which is great”). It had been chanting one of his campaign slogans, “Build that wall.” The audience had no idea that Judge Curiel is a Hoosier – born and raised in a state that Trump “loved” when it delivered the final blow to the stop-Trump movement.

Judge Curiel received his bachelor’s and JD degrees from Indiana University. After graduation, he spent a decade at two small Indiana law firms before moving to California where he was a career prosecutor for seventeen years. In 2002, Republican governor Arnold Schwarzenegger appointed him to the San Diego Superior Court. After President Obama named him to the federal bench, the Senate confirmed him by a voice vote in 2012.

The Full Article (June 1, 2016)

Part 2 by Steven J. Harper:

Every week, Donald Trump intensifies his attack on the rule of law and the fundamental American values that underlie it. In the wake of the Orlando shootings, he added two more.

— Expanding his proposed ban on all Muslim immigrants, he added migrants from any part of the world “with a proven history of terrorism” against the United States or its allies.

— He withdrew The Washington Post’s press credentials to campaign access. That was the culmination of a crusade that Trump has pursued for a month against Jeff Bezos, who owns Amazon and the paper.

Make no mistake. Trump’s actions are part of his “crazy-like-a-fox” campaign strategy. And they fit together neatly.

The Full Article (June 15, 2016)

The Belly of the Beast: The Trump Three-Step

By Steven J. Harper:

The tax code allows taxpayers to depreciate the cost of a commercial building over its assumed life of 39 years. Each year, one thirty-ninth of the cost gets deducted from income. When you deal in big buildings, even small ownership slices translate into big tax depreciation deductions. It doesn’t matter that most buildings last a lot longer than 39 years. Properly structured, depreciation and other deductions relating to the ownership of commercial property pass through to individual taxpayers. Throw in taxes and other deductions, and the amounts get even larger.

Likewise, if a taxpayer loses money on a business venture — and Trump has ample experience there as well — those losses also offset current income. If total deductions and losses in a year exceed income, they carry-forward to offset income in future years.

“He’s going to pay the smallest amount of taxes possible,” Lewandowski said in reframing the entire issue. “Every deduction possible. He fights for every single dollar. That’s the mindset you want to bring to the government.”

Don’t be surprised if Trump’s personal effective tax rate turns out to be surprisingly close to zero. It’s probably a lot lower than what most of his supporters pay. I guess that makes Trump a winner. It makes those supporters something else.

The Full Story (May 25, 2016)

New York Magazine: Trump Honors Cinco de Mayo With the Best Tweet of His Storied Career

By Eric Levitz:

Here Trump shifts his focus from the textual to the visual, while retaining — and improving upon — his signature, exclamatory kicker. The shadow draped across his orange face, the stubby thumb pointed skyward, the hovering fork of taco meat, all in their own way serving to express the Donald's final, ecstatic phrase, "I love Hispanics!"

And just when the viewer feels he or she has fully comprehended the meaning of Trump's work, an Easter egg tucked into the corner of the frame reveals whole new layers of hermeneutical possibility.

Donald Trump is eating a taco salad on top of a bikini-clad photo of his ex-wife, Marla Maples. pic.twitter.com/sW2itGBAOK

— Benny (@bennyjohnson) May 5, 2016

The Full Story (May 5, 2016)

Ars Technica: Trump University and the Art of the Get-Rich Seminar

By Joe Mullin and Jonathan Kaminsky:

The booming industry of real estate investment seminar gurus—who by the early 2000s numbered in the dozens—made it clear that you could make big money selling a roomful of people at a time on the dream of easy riches. But seminar work itself was complex, ranging from managing teams of traveling crew members to keeping sales pitches just murky enough that law enforcement wouldn't butt in.

Trump wanted a piece of the action, so he struck a licensing deal with the Milins in 2006. The couple created the “Trump Institute,” using much of the same pitch material and some of the same pitchmen.

The launch of Trump Institute, in turn, paved the way for the later creation of the Trump University live seminar business, which continues to be one of the biggest scandals dogging Trump’s presidential campaign. The New York Attorney General sued Trump, the Trump University, and its president, Michael Sexton, in 2013, alleging that they had ripped off thousands of customers, some of whom paid tens of thousands of dollars for “mentorship” programs.

The Full Article (April 29, 2016)

The Marshall Project: Trump and the Mob

By Tom Robbins:

And then there was the person who had introduced Trump to the FBI agents in the first place. This was a 6-foot-5 bear of a man named Daniel Sullivan, a former Teamsters leader who was serving as what Trump called his "labor consultant" at the time. Sullivan wore other hats as well: He was partners with a reputed Atlantic City mobster named Kenneth Shapiro who controlled the local scrap market and who was in the process of selling Trump a large plot of land at top dollar on which to build his casino.

Sullivan, who had once been close to Jimmy Hoffa, was also secretly operating as an FBI informant, filling in the Bureau on the various mobsters who crossed his path. I know this because Sullivan, who died of a heart attack in 1993, told me all about it, proudly providing copies of the FBI memos as proof. And Sullivan wasn’t just bragging. The FBI agents confirmed to me both the authenticity of the documents and the meetings Sullivan had arranged for them with the budding casino kingpin.

* * *

On paper, the demolition contractor was a union company, as were all of Trump's vendors at the time. But Local 95 of the demolition workers was essentially a subsidiary of the Genovese crime family, and few union rules were enforced. Most of the workers were undocumented immigrants from Poland and they were paid so little and so sporadically that many were forced sleep on the job site. A rank and file union dissident later sued Trump for failing to pay pension and medical benefits required under the union contract. Trump denied knowing about conditions at the work site. Sullivan, who by now had his own gripes with Trump, said otherwise. He testified in the civil suit that he had repeatedly warned the developer about the problems. Trump, in a rush to clear the site, had dismissed his concerns, he said.

Despite Trump's insistence that he never settles lawsuits, he wound up settling that one for an undisclosed sum. Whatever the amount, it seemed to make the union dissident and his attorneys quite satisfied.

The Full Article (April 27, 2016)

The Atlantic: The Many Scandals of Donald Trump

By David A. Graham:

The Four Bankruptcies   

Where and when: 1991, 1992, 2004, 2009

The dirt: Four times in his career, Trump’s companies have entered bankruptcy.

• In the late 1980s, after insisting that his major qualification to build a new casino in Atlantic City was that he wouldn’t need to use junk bonds, Trump used junk bonds to build Trump Taj Mahal. He built the casino, but couldn’t keep up with interest payments, so his company declared bankruptcy in 1991. He had to sell his yacht, his airline, and half his ownership in the casino.
• A year later, another of Trump’s Atlantic City casinos, the Trump Plaza, went bust after losing more than $550 million. Trump gave up his stake but otherwise insulated himself personally from losses, and managed to keep his CEO title, even though he surrendered any salary or role in day-to-day operations. By the time all was said and done, he had some $900 million in personal debt.
• Trump bounced back over the following decade, but by 2004, Trump Hotels and Casino Resorts was $1.8 billion in debt. The company filed for bankruptcy and emerged as Trump Entertainment Resorts. Trump himself was the chairman of the new company, but he no longer had a controlling stake in it.
• Five years later, after the real-estate collapse, Trump Entertainment Resorts once again went bankrupt. Trump resigned from the board, but the company retained his name. In 2014, he successfully sued to take his name off the company and its casinos—one of which had already closed, and the other of which was near closing.

The Full Article (April 19, 2016)

New York Magazine: How the Trump Campaign Actually Works

By Gabriel Sherman:

Six months later, Lewandowski and Hicks worked into the early hours of the morning prepping for Trump’s campaign announcement in the lobby of Trump Tower. “It had to be perfect,” Lewandowski said. “We had to build the stage, make sure the flags hung perfectly; the eagles faced out; the carpet was red, and he would wear a red tie.” And hire plants. The campaign paid actors $50 each to wear Trump T-shirts and wave placards.

Later that morning, they watched from the wings as Ivanka introduced her father in front of reporters and photographers and the manufactured crowd. “It looked like the Academy Awards!” Trump recalled. “You saw the cameras, forget it. You couldn’t get another person in.”

Trump didn’t read a prepared speech, but he knew what he wanted to say, which hardly mattered anyway because hardly anyone took his candidacy seriously at the time. “Nobody said anything,” Trump said about the fact that he had accused Mexico of sending “rapists” over the border into the U.S. “Then two weeks later, they started saying, ‘Wait a minute! Did he really say that?’ ”

He hadn’t tested the line, but Nunberg’s deep dive into talk radio had shown him that this was the sort of thing that would resonate with a certain segment of the Republican base. He also knew that this kind of outrageous statement would earn him the free media attention ($1.9 billion worth and counting, according to the New York Times) that would propel his campaign.

This strategy did not go over well in all corners of the Trump empire. Ivanka, Trump’s 34-year-old daughter, had carefully tended her public image as the softer, more refined face of the Trump empire. Now her father’s hard-edged nativist rhetoric risked damaging not only her brand but her business. A few days after the announcement speech, Ivanka received a terse email from Kimberly Grant, the CEO of ThinkFood Group, the holding company behind celebrity chef José Andrés, whose restaurant was supposed to be the anchor tenant in one of Ivanka’s biggest projects: the $200 million redevelopment of the Old Post Office in Washington, D.C., into a luxury hotel.

“We need to talk. Getting crushed over DJT comments about Latinos and Mexicans,” Grant wrote her, according to legal filings.

Ivanka forwarded Grant’s email to her executives.

“Ugh,” one responded. “This is not surprising and would expect that this will not be the last that we hear of it. At least for formal, prepared speeches, can someone vet going forward? Hopefully the Latino community does not organize against us more broadly in DC / across Trump properties.”

Ivanka’s older brother, Donald Jr., also weighed in. “Yea I was waiting for that one. Let’s discuss in the am.”

Ivanka did her best to salvage the partnership. She asked her father to issue an apology, even submitting several drafts for him to release to the press. But he refused. “Rapists are coming into the country! You know I was right,” Trump later told me.

The Full Article (April 3, 2016)

Slate: Donald Trump Hates Women

By Franklin Foer

Trump considers himself such a virile example of masculinity that he’s qualified to serve as the ultimate arbiter of femininity. He relishes judging women on the basis of their looks, which he seems to believe amounts to the sum of their character. Walking out of his meeting with the Washington Post editorial board this week, he paused to pronounce editor Karen Attiah “beautiful.” When he owned the Miss USA and Miss Universe pageants, he would screen all the contestants. His nominal reason for taking on this role was to make sure that his lackeys weren’t neglecting any beauties. His real motive was to humiliate the women. He would ask a contestant to name which of her competitors she found “hot.” If he didn’t consider a woman up to his standards, he would direct her to stand with her fellow “discards.” One of the contestants, Carrie Prejean, wrote about this in her book, Still Standing: “Some of the girls were sobbing backstage after [Trump] left, devastated to have failed even before the competition really began ... even those of us who were among the chosen couldn’t feel very good about it—it was as though we had been stripped bare.”

Humiliating women by decrying their ugliness is an almost recreational pastime for Trump. When the New York Times columnist Gail Collins described him as a “financially embittered thousandaire,” he sent her a copy of the column with her picture circled. “The Face of a Dog!” he scrawled over her visage. This is the tack he took with Carly Fiorina, when he described her facial appearance as essentially disqualifying her from the presidency. It’s the method he’s used to denounce Cher, Bette Midler, Angelina Jolie, and Rosie O’Donnell—“fat ass,” “slob, “extremely unattractive,” etc.—when they had the temerity to criticize him. The joy he takes in humiliating women is not something he even bothers to disguise. He told the journalist Timothy L. O’Brien, “My favorite part [of the movie Pulp Fiction] is when Sam has his gun out in the diner and he tells the guy to tell his girlfriend to shut up. Tell that bitch to be cool. Say: ‘Bitch be cool.’ I love those lines.” Or as he elegantly summed up his view to New York magazine in the early ’90s, “Women, you have to treat them like shit.”

The Full Article (March 24, 2016)