Circumstances change; Donald Trump doesn’t. In early 1973, when he was twenty-six years old, he and his father, Fred Trump, who was a major developer of houses and apartment buildings in the outer boroughs of New York City, gave an interview to the real-estate section of the Times. The resulting article described Donald as the only one of Fred’s five children to show an interest in the family business, and said that he had become its president after finishing “first in his class” at Wharton business school. The piece also noted that the Trumps were in the process of buying a prime site to develop on the East Side, which Trump fils called “our entry into the Manhattan field.”
More than fifty years on, Trump isn’t letting an election campaign or attempted assassinations interfere with his efforts to hype up and promote his various ventures. The day after federal agents arrested a man who had spent nearly twelve hours hiding outside the former President’s West Palm Beach golf course with an assault rifle, Trump appeared on an X live stream to promote a new crypto outfit, World Liberty Financial. (Three years ago, he called Bitcoin “a scam.”) On Saturday, he plugged a new set of “Official Trump Coins!” on his social-media accounts.
It just so happened that the crypto launch coincided with the publication of a new book about Trump’s business career: “Lucky Loser: How Donald Trump Squandered His Father’s Fortune and Created the Illusion of Success,” by Russ Buettner and Susanne Craig, two investigative reporters at the Times. During Trump’s 2016 Presidential campaign, and when he was in the White House, Buettner and Craig wrote a number of blockbuster stories revealing how, for decades, his businesses had recorded huge losses, and how he engaged in dubious schemes to reduce his taxes. In “Lucky Loser,” the authors trace Trump’s dealings all the way back to the 1973 Times story, which they describe as largely fictitious. Trump “had graduated without honors,” they write. “His brother Freddy had displayed an interest in the business and been pushed aside by their father. . . . The Trumps had not bought land on the East Side of Manhattan for an apartment building and would not do so that decade.”
It’s not news that Trump is an inveterate teller of tall tales. The more penetrating argument that Buettner and Craig make is that he’s a lousy businessman who only got as far as he did because of a series of lucky breaks that “could paper over a litany of failure and still fund a lavish life.” “There is no evidence that in fifty years of labor Donald Trump added to his lucky fortunes,” the authors conclude. “He would have been better off betting on the stock market than on himself.”
According to Axios, Steven Cheung, the director of communications for the Trump campaign, dismissed the new book as “lies” and “nonsense,” and suggested that it belonged in the bargain bin at the bookstore. Actually, it deserves a place in the shopwindow. Combining the groundbreaking reporting of its authors with details unearthed throughout the years by other journalists and financial analysts, “Lucky Loser” is comprehensive, persuasive, and packed with damning anecdotes.
It starts at the beginning, with Trump’s original charmed break: the family into which he was born. Buettner and Craig relate how Trump’s father, Fred, paid for his private education, created trust funds for him and his siblings, helped to finance some of his early real-estate ventures and his expensive Manhattan life style while he was on the make, and eventually bequeathed him $177.3 million. Pop’s connections were also a boon. It was one of Fred’s old friends, Mayor Abraham Beame, who helped to facilitate one of Trump’s first big plays: obtaining an option to develop the West Side rail yards from a bankruptcy court overseeing the assets of its previous owner, Penn Central. During the construction of Trump Tower, it was Fred that helped him acquire the air rights he needed from a neighboring Tiffany’s building. And the podiatrist who provided Trump with the “bone spurs” diagnosis that enabled him to avoid the Vietnam draft? Buettner and Craig cite a 2018 report in the Times that said he may well have been a doctor who leased office space in a Fred-owned building.
Trump’s second major stroke of good fortune came in the early nineties. A number of banks, for reasons known only to them, had extended him billions of dollars’ worth of credit to finance an acquisition spree that included the Plaza Hotel, the Eastern Air Lines Shuttle, and three hotels in Atlantic City: the Trump Plaza, the Trump Castle, and the Trump Taj Mahal. (He bought the latter one when it was only partially built.) But by the summer of 1990 his businesses were struggling to pay the interest on their debts. He missed some interest payments, which raised the prospect of the banks calling his loans and forcing him and his empire into bankruptcy.
Two factors complicated the situation. Trump had cross-collateralized some of the loans, using the same assets to back more than one of them. Also, the banks had issued him with some nine hundred million dollars in credit based solely on his personal guarantee. If the banks had called their loans, “assets would have to be unloaded at fire sale prices, and they would all be fighting for a place in line to collect,” Buettner and Craig write. Rather than pushing Trump under, the banks agreed to keep him afloat in the hope that his businesses would be worth more as going concerns. They suspended some of his debt payments, issued a new line of credit to keep the businesses operating, and gave Trump a personal allowance of four hundred and fifty thousand dollars a month.
As Trump’s financial crisis dragged on, he was eventually obliged to relinquish the Plaza Hotel, the airline shuttle, his personal yacht, and half of his ownership stakes in the Taj Mahal, Castle, and Plaza casinos, which had entered bankruptcy. But these settlements left him in effective control of the Atlantic City properties and some of his other buildings, and allowed him to avoid a personal bankruptcy. On Wall Street, he was widely regarded as a busted flush. Still, he talked a big game to anyone who would listen, and, in the early two-thousands, fortune shone on him again when Mark Burnett, a reality-television producer, cast him as a successful businessman, despite the copious evidence to the contrary, on “The Apprentice.”
This was Trump’s third, and arguably biggest, piece of luck. Between 2004 and 2015, he starred in fourteen seasons of the show, which turned him into a national celebrity, and generated hundreds of million of dollars for him in fees, profit shares, and licensing deals and endorsement fees that resulted from his enhanced public standing. Even this huge windfall wasn’t enough to cover the ongoing losses from his other businesses, including a string of upscale golf courses that he had acquired. In 2009, Buettner and Craig note, the Trump Organization appears to have recorded accumulated tax losses of nearly eight hundred million dollars, which Trump then used to claim a big refund from the I.R.S. for the taxes he had paid since “The Apprentice” had taken off. In accordance with its standard procedure, the tax agency issued the refund—$72.8 million, including interest—and opened an audit. “The IRS audit would remain open for years to come, posing a potential threat if the final decision went against him,” the authors write. “But for the foreseeable future, the cash was his.”
Trump’s restructured casino company, Trump Entertainment Resorts, continued to struggle, and in 2014 it filed for bankruptcy for a third and final time. During his Presidency, red ink flowed at many of his other businesses, and the Trump Organization’s liabilities mounted. On the day he left office, in January, 2021, the company faced the prospect of nine hundred million dollars of debt coming due in the next four years, according to a 2022 article by Dan Alexander, of Forbes. Since then, though, Trump has had even more lucky breaks, one of which can be traced all the way back to the seventies and his interest in the West Side rail yards.
After failing for years to develop the rail yards, Trump reluctantly sold a majority stake in them to a Hong Kong firm, which, in 2005, sold them and used the proceeds to acquire two prime office buildings: 1290 Avenue of the Americas, in New York, and 555 California Street, in San Francisco. According to Buettner and Craig, Trump tried, and failed, to block both of these deals. The Hong Kong firm eventually sold the two buildings to Vornado Realty Trust, a big New York real-estate outfit, and Trump, through no volition of his own, ended up with a minority stake in a Vornado-run partnership that became one of his most valuable assets. Around May, 2021, Vornado refinanced the mortgages on the two office buildings in a deal that enabled it to extract more than six hundred million dollars. According to Forbes, Trump received an estimated payment of a hundred and sixty-two million dollars.
That’s Trump’s career in a nutshell. Earlier this year, he received another big financial boost, at least on paper. After his Trump Media & Technology Group, which owns Truth Social, issued shares, investors pushed them up to stratospheric levels despite the fact that, during the first quarter, the business recorded a loss of $327.6 million on revenue of less than a million dollars. Since the initial surge, the stock has fallen back, and it fell further on Friday, when the customary “lock-up period” that prevented Trump and other stockholders from selling their shares expired. Still, Trump’s stake in the company has a paper value of about $1.6 billion.
The irony is that he can’t touch this money. If he tries, much of it is likely to vaporize as the stock crashes on news that he’s cashing out. Trump is also facing other financial challenges: a post-pandemic office glut that has led to significant declines in the valuations of commercial real estate; the long-running I.R.S. audit, which Buettner and Craig say could end up costing him a hundred million dollars; two judgments totalling $88.3 million for sexually abusing and defaming the writer E. Jean Carroll; and a four-hundred-and-fifty-four-million-dollar fine, including interest, for fraudulently inflating the value of his assets to banks and insurance companies, which the New York judge Arthur Engoron imposed earlier this year after a lengthy civil trial. Trump is appealing the three court judgments, but if he loses he will be in another jam. Has his luck finally run out? Maybe. Based on his history, it can’t be guaranteed. ♦
