Is Trump’s Business Success an Indicator of Presidential Success? Are His Business Failures and Deceipts Impeachment Worthy?

I think the case to impeach Trump is rooted in an ever-growing accumulation of examples of incompetency, corruption and the violation of democratic norms. Much of this predates his presidency. I believe past actions matter in how we treat and react to his current behavior. It sets up a context.  For Trump, the most understandable reason for voting for him was that he was a vote against Hillary Clinton.  I understand this because that’s the primary reason I voted for Hillary.

But if the bar was set that low. If Trump won primarily because of who he was running against, I think it’s more than reasonable to give his presidency a short leash. He entered the presidency without a mandate and with an unprecedented degree of skepticism and weariness. In that sense, then, I think clearing the impeachment bar isn’t quite as high as is normally the case.

The case for a high impeachment bar is rooted in a respect for the democratic forces that placed a person in the executive office. Trump, however, lost the popular vote by 2,000,000 people, squeaking out an electoral victory by slim margins in a few midwestern states. And there was a lot of questionable events that happened along the way, from Russian intervention and Comey’s ill-timed announcements. The democratic mandate barely exists in his case.

Having said that, I believe in redemption. I believe people can change and grow. But past misdeeds impose some amount of obligation on the person. They require an apology, a reasonable attempt to correct past wrongs, and a renewed energy to move forward a changed person.

Trump has a long history of moral failings and missteps, has shown a reluctance to own up to them, rather prefering to attack and defend his behavior through lawsuits and retaliatory defamation, and has shown a willingness to continue his pattern of past behavior while in the white house.

This blogpost is perhaps the first in a series that will lay out the case for impeachment, one dimension at a time.

Luckily I don’t have to write much on each topic, because much of this has been widely reported. I’ll reference a sampling of that here.

I’ll begin with Trump’s wealth. Trump has spent a lot of time and energy hiding both his wealth and the extent and nature of his business entanglements, so there’s a lot we don’t know. I’ll start with what we know and then lay out a few possibilities that have yet to be fully proven:

First, how he made his wealth

Early Success

First and foremost, he was born into it. His father was successful, self-made and well-connected. Trump leveraged this good fortune in a number of ways. He inherited a lot of wealth. He benefited from his father’s political and business connections, and his father lent him money as he pursued his early real-estate investments. He took advantage of these benefits to land lucrative real-estate deals in New York City.

However, his long-term success in New York City, is fairly weak.

He has a record of not paying or underpaying his contractors:

“One contractor, who spoke on the condition of anonymity for fear of being sued by Mr. Trump, said Mr. Trump underpaid on one large job, at one of his towers, by almost $100,000. The contractor opted not to sue, estimating the litigation would cost more than the losses. The two parties have not done business since.

Lawyers who spoke to The Times had similar stories.”

Bankruptcy

He heavily leveraged early real-estate success into his casinos, however during an economic downturn and an over-reliance on high interest junk bonds, he was forced into multiple bankruptcies, largely protecting his own assets while forcing the brunt of the losses on banks and those who did business with him.

In the late 1990’s, his father died, transferring a huge inheritance to him and his siblings. In addition, he discovered a different business model more in-line with his unique gifts, gifts of showmanship and flair. From here, he found he could make a fortune selling his name.

The USFL

While not directly related to his fortune, what he did to the USFL fits into a larger pattern. He takes large risks fueled by an enormous ego and ends up destroying the thing he’s involved in.

Branding

Many of the properties that bear the Trump name aren’t actually owned by the mogul. The Trump Organization has been known to partner with developers in licensing deals. In such an arrangement, a developer pays Trump a licensing fee; in exchange, they’re given permission to brand their building with the Trump name and logo. Trump benefits by receiving a regular stream of royalties, while the developer can increase the rates she charges because the Trump name signifies high quality and luxury. According to Trump, his real estate licensing deals, intellectual propertybrands and branded development are worth more than $3.3 billion; however, Forbes pegs this number at around $253 million.

A few events in his life really set him up to succeed in this way.

Early Deceipt

First of all, he successfully got himself placed on the Forbes list of richest developers early on in his life. And he did so using deceitful means. Getting him on the Forbes list, helped establish himself as an investor to be taken seriously, helping him to establish beneficial tax benefits from local politicians early on and convinced banks and investors to dump millions of their own dollars into his investments.

The Apprentice

As he transitioned into brand licensing, convincing others that the Trump name is a symbol of wealth and business acumen was critical. He is a genius at this kind of marketing. Getting the Apprentice gig was a particular coup here.

Russian Entanglements

It’s clear US banks won’t lend to him because of earlier bankruptcies. It’s also clear, Trump has a long history with Russia. 

Trump deftly distanced himself from the developers’ troubles, telling the Sun-Sentinel that he questioned their “timing.” But the condo market gradually improved, thanks in part to Russian buyers. A Reuters investigation found that 63 people with Russian addresses or passports have purchased $98.4 million of property in Trump-branded condos in South Florida.

As the new president was taking office, the Trump brand sparkled brighter than ever for Russians. The Miami Herald reported on Jan. 30 that in November 2016, Russians topped the list of foreigners looking for homes in the Miami area.

Oren Alexander, one of the top brokers at Douglas Elliman, explained the post-election trend to the Herald: “There’s no doubt that Russian buyers think America is a good place to be again.” Among the places that attracted Russian purchasers, he said, were Sunny Isles Beach and Fisher Island.

Mueller’s investigation might tell us whether any of these Trump-Russian business connections improperly melded into the 2016 campaign. But at the core of Trump’s interaction with his Russian friends is an insight they have shared ever since Soviet days: Politics may be transitory, but real estate is forever.

Although, it appears to be speculative, it seems like Trump found money to fund his ventures with Russian oligarchs he was unable to find in the US banks.

Using The Presidency to Further His Business

It’s clear Trump is using his position as president to further his business interests across the globe and that is troubling.

Are these impeachable offenses?

I believe so, but I can be talked out of it. I believe Republicans need to decide this and so far they are unwilling to entertain the idea. Trump has developed a religious attachment from his base, which makes sense. In another post, I can describe how Trump succeeded by becoming something of a cult leader. His enthusiastic base is strong enough to punish apostasy within the Republican party.  I get why Republican Senators are loathe to move on him.

A lot depends on how much evidence Mueller and others can bring up in a way that’s convincing enough to the Republican base. Trump refuses to release his tax returns. We don’t really know how wealthy he actually is and how much of that is through unethical or illegal means.

Despite that, I think the body of evidence is enough to convince me. But I’m not the one with the power to decide.

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