His strongman threats are scary. But don’t forget that he’s weak.
Living under a president who daily defiles his office and glories in transgressing the norms holding democracy together is numbing and enervating. It’s not emotionally or physiologically possible to maintain appropriate levels of shock and fury indefinitely; eventually exhaustion and cynical despair kick in.
But every once in a while Donald Trump outpaces the baseline of corruption, disloyalty and sadism we’ve been forced to get used to. Outrage builds and the weary political world stirs. Sometimes even a few Republican officeholders feel the need to distance themselves from things the president says or does.
Child separation caused this kind of clarifying horror. There was a moment of it when Trump tweeted that four congresswomen of color should go back to the “totally broken and crime-infested places from which they came.” And now, thanks to Trump’s latest attack on democracy, we’re seeing it again.
At a Wednesday evening news conference, Trump was asked whether he would commit to a peaceful transfer of power after the November election. “We’re going to have to see what happens,” said the president. He then complained about “the ballots,” apparently meaning mail-in ballots, which he’s been trying to discredit: “Get rid of the ballots and you’ll have a very peaceful — there won’t be a transfer, frankly. There will be a continuation.”
His words — the demand to discard ballots, the dismissal of a possible transfer — were a naked declaration of autocratic intent. Looking at the BBC’s website, where a blaring headline said, “Trump Won’t Commit to Peaceful Transfer of Power,” you could see America being covered like a failing state.
Trump’s words were all the scarier for coming on the same day as Barton Gellman’s blockbuster Atlantic article about how Trump could subvert the election. The chairman of Pennsylvania’s Republican Party told Gellman, on the record, that he’d spoken to the campaign about bypassing a messy vote count and having the Republican-controlled legislature appoint its own slate of electors. A legal adviser to the Trump campaign said, “There will be a count on election night, that count will shift over time, and the results when the final count is given will be challenged as being inaccurate, fraudulent — pick your word.”
As terrifying as all this is, it’s important to remember that Trump and his campaign are trying to undermine the election because right now they appear to be losing it.
Trump is down in most swing state polls, tied in Georgia and barely ahead in Texas. His most sycophantic enabler, Lindsey Graham, is neck-and-neck in South Carolina. The president is counting on his new Supreme Court nominee to save his presidency, and she may, if the vote count gets to the Supreme Court. But a rushed confirmation is unlikely to help Trump electorally, because in polls a majority of Americans say the winner of the election should make the appointment.
Trump may be behaving like a strongman, but he is weaker than he’d like us all to believe. Autocrats who actually have the power to fix elections don’t announce their plans to do it; they just pretend to have gotten 99 percent of the vote. It’s crucial that Trump’s opponents emphasize this, because unlike rage, excessive fear can be demobilizing. There’s a reason TV villains like to say, “Resistance is futile.”
“We cannot allow Trump’s constant threats to undermine voters’ confidence that their ballots will be counted or discredit the outcome in advance,” Michael Podhorzer of the A.F.L.-C.I.O. recently wrote in a memo to allies. Podhorzer said that the organization’s polling suggests that “this close to the election, we do Trump’s work for him when we respond to his threats rather than remind voters that they will decide who the next president will be if they vote.”
This doesn’t mean people shouldn’t be alarmed. I’m alarmed every minute of every day. Trump is an aspiring fascist who would burn democracy to the ground to salve his diseased ego. His willingness to break the rules that bind others gives him power out of proportion to his dismal approval ratings. He blithely incites violence by his supporters, some of whom have already tried to intimidate voters in Virginia.
Yet part of the reason he won in 2016 is that so few of his opponents thought it possible. That is no longer a problem. Since then, when voters have had the chance to render a verdict on Trump and his allies, they’ve often rejected them overwhelmingly. Under Trump, Democrats have made inroads into Texas, Arizona, even Oklahoma. They won a Senate seat in Alabama. (Granted, the Republican was accused of being a child molester.) Much attention is paid to Trump’s fanatical supporters, but far more people hate him than love him.
In the run-up to the 2018 election, many people had the same fears they have now. Analyzing its survey results, Pew found that “voters approached the 2018 midterm elections with some trepidation about the voting process and many had concerns that U.S. election systems may be hacked.” After 2016 it was hard to believe polls showing Democrats with a lead of more than eight points. But the polls were right.
Certainly, things are different now than they were even two years ago. A pandemic is disrupting normal campaigning and changing the way a lot of people vote. Trump has much more at stake. Investigations in New York mean that if he’s not re-elected, he could be arrested.
It’s also true that by floating the idea of refusing to concede, Trump begins to normalize the notion. The nationwide uproar over family separation has worn off, even though family separations continue. A House resolution condemned Trump’s initial racist attack on Ilhan Omar, Rashida Tlaib, Alexandria Ocasio-Cortez and Ayanna Pressley. Now he says similar things at his rallies and it barely makes news.
One of the most oft-used metaphors for the Trump years has been that of the slowly boiling frog. (The frog, in this case, being democracy.) By threatening what is essentially a coup, Trump may have turned the heat up too quickly, forcing some elected Republicans to implicitly rebuke him by restating their fealty to a constitutional transfer of power.
But if history is any guide, those Republicans will adjust to the temperature. The next time Trump says something equally outrageous, expect them to make excuses for him, or play some insulting game of whataboutism by likening Biden’s determination to count ballots past Nov. 3 to Trump’s refusal to recognize the possibility of defeat.
Still, Trump can be defeated, along with the rotten and squalid party that is enabling him. Doing so will require being cleareyed about the danger Trump poses, but also hopeful about the fact that we could soon be rid of him.
Trump would like to turn America into a dictatorship, but he hasn’t yet. For over four years he has waged a sort of psychological warfare on the populace, colonizing our consciousness so thoroughly that it can be hard to imagine him gone. That’s part of the reason he says he won’t leave if he’s beaten in November, or even after 2024. It’s to make us forget that it’s not up to him.
Shortly after Trump was elected, the Russian-born journalist Masha Gessen published an important essay called “Autocracy: Rules for Survival.” Gessen laid out six such rules, each incredibly prescient. The one I most often hear repeated is the first, “Believe the autocrat,” which said, “Whenever you find yourself thinking, or hear others claiming, that he is exaggerating, that is our innate tendency to reach for a rationalization.”
Right now, though, I find myself thinking about the last of Gessen’s rules: “Remember the future.” There is a world after Trump. A plurality of Americans, if not an outright majority, want that world to start in January. And whatever he says, if enough of us stand up to him, it can.
that’ss eyes that are for people who are
actually suffering minorities be like no
no this is not cool so she’s not saying
this from small blogs I’m not seeing
this from anything main strike yep
correct because mainstream they’re
always gonna cover for this that right
100% of the time yeah they’re gonna
cover their the thing about those blogs
is like a lot of them are basically like
Ari Shaffir refers to them as like
college papers yeah it’s like a lot of
these blogs so a college student written
yeah but they’re often speaking truth oh
yeah well I would hope I would hope more
would come out and say hey you can’t say
you’re Native American just like like
you imagine the outrage if I just
started call myself African American
well do you know what did you see what
Trump said he said well I can’t call her
Pocahontas anymore because she’s not an
Indian and I’m just like oh my god we’re
not worthy he says some hilarious shit
oh yeah he really does he really does
he’s fucking funny off-the-cuff oh yeah
really is you know and the way he goes
after people like even though he’s the
president like he still calls people
fucking losers I mean he’s still he
still caused him losers on Twitter and
goes after them horse face horse face he
called star McDaniels horse face just
think of how repulsive he is physically
he’s fat his faces all fuckin hanging
off of his bones he’s got white raccoon
eyes and orange skin and yet he still
will mock stormy Daniels and call her
horse face someone tweeted out I forget
who and I apologized the thing he said
they go imagine what happens that he
Trump’s the first person who fucked a
porn star and she had to brag about it
and then she paid him yeah yeah well he
did pay her right but what he paid her
what she’s gonna have to pay him is
probably like a factor of three or fours
I mean how much more she’s gonna wanna
pain yes for 350k that’s all he asked
for you uh that’s proved very reasonable
yeah that doesn’t even cover her book
yes that’s probably like he just wants
just be done like that yet it just yet
give me that paper yeah just give me a
little something I need a little
something from you
with this let this slide I want 300,000
yeah yeah it’s probably her book that’s
really all the money no she got more
than 350 I’m positive
how much you think she got for that book
750 I’d guess yeah but she’s got to pay
and her agents getting 15 yeah she’s
probably not even bringing three home so
it’s all that’s money’s gone oh yeah
that’s all gone all gone 100% gone and
no one’s buying that book it stiffed
yeah yeah nobody gives a shit
she said it already like I fucked the
president that’s your book your book as
I fucked the president well you know
here’s the funny part with her remember
this people she was making fun of his
dick like she’d hit a mushroom deck
whatever and people are like that’s what
and then people were like that you know
as fucked up as he is that’s body
shaming he really shouldn’t make fun of
someone and she’s like you know what
you’re right I’m sorry
and then he goes hey horse face she lost
his fucking mushroom dick at like the
next day she’s back on it it was amazing
The fact that he can call her horse face
and he’s the president on twitter..
But she doesn’t even have a horse face.
It doesn’t matter. I know but it’s just
so weak I mean Ted Cruz really isn’t the
Unabomber or whatever the fuck you said
he was say that that’s the name they
cease is that Jeff gay fucking it’s also
crazy that was the best part so ted
cruz’s was known as like the best
debater in the senate he had this
Harvard or Yale whatever debating team
great debater everyone we recognized him
for this how did the fuck do you prep
for a debate be like oh yeah well your
dad shot JFK it’s like what the fuck
wait what well It didn’t have to make
sense right people the people that hurt
Trump supporters don’t want to make
sense they just want him to win right
right exactly and it works yes yeah well
he’s just had to get zingers in oh yeah
yeah I mean it’s like roast battle more
than right and they don’t get that there
was this my favorite tweet of his my
favorite where he goes whenever I speak
of the losers and the haters I do so
with great affection it’s not their
fault they were born fucked up at
exclamation point that’s a real tweet
tweet it’s the best one
and it’s true yeah you know one of my
favorite things was him at a speech
where he was talking it was 2015 before
he even talked about running for
president or it was even I don’t think
he was a hundred percent open about
running for president and he said
there’s two ways to talk to China you
could you know could prose things you
could propose things and he says it like
you know normally and then he says or
you could say listen motherfucker yeah
you heard that no oh my god it’s great
fucking pull it it’s it’s fucking great
because everybody starts cheering yeah
because it’s so forbidden in this
environment wearing an expensive suit
standing in front of a podium he says or
you could say listen motherfuckers like
this is what we’re gonna do and
everybody started yeah it’s so exciting
it’s so much more exciting then Marco
Rubio or you know someone boom Jeb is a
waste jam is a big fat mistake I watched
those videos which speech he wasted June
of 25th now when he said mother when
he’s just just not speech when he’s
talking about China and he said listen I
the fuckers China China China yeah that
was a thing Puerto Rican when he ordered
I’m announcing a ban on all Muslim
immigration Muslim here this is a great
one do this because it’s leadership this
time instead of with his name in gold
it’s with his words this is discussing
Iraq we build a school we build a road
they blow up the road they blow up the
school we build another school we build
another road they blow them up we build
again in the meantime we can’t get a
school built in Brooklyn do the
audience’s approval talking oil we have
nobody in Washington that sits back and
said you’re not going to raise that
price you understand me
this is a long time ago sing Chinese
goods here’s your mother we’re gonna tax
you 25% while poles 2011 is that what it
says over there yeah but here’s what’s
interesting notice the person who posted
their name is say no to racists yeah
they probably put it up as a negative
well no 2011 he would have been
considered a Democrat right oh no he’s
endorsed Romney he endorsed Romney
Republican race he was a Democrat until
what 2010 probably around then because
he was gonna run independent at some
point Trump 2012 look at that this is
the guy we’ve been looking for ha ha ha
seven years ago but it’s just deplorable
what changed it they probably damaged it
in the future because it says seven
years yeah fuck that’s the time travel
that hack join read uh yeah someone did
it someone definitely hacked it yeah
just hilarious they didn’t give the good
version of that either because they
believed in it well not just that
because you also see if you can find the
better version because he basically
practices it like you know people been
saying it like this right you can say it
like this or you can say listen you
motherfuckers and that’s when everybody
starts cheering he actually gave an
example yeah he actually guys what can
you do yeah so easy I drop a twenty five
percent tax on China
and you know I said to somebody that is
really the messenger the messenger is
important I could have one man saying
way to tax you 25% and I could say
another listen you motherfuckers brooder
Here’s how the Press lies on the campaign
trail he set a point I remember it was
the sense of it goes you better shut
your mouth so he didn’t say the word
mm-hmm they bleeped it and they bleeped
it to make it look like he was cursing
and he’s like you guys are fucking shady
that’s very Shady yeah that’s Shady you
can’t just bleep a pause and pretend
that there’s some sort of an offensive
word in there right so that’s really
that’s just deceptive right and it’s
pervasive they do it all the fucking
well who’s good out there to challenge
him they’re fucked all right fuck you
know why they’re fucked why because
we’ve never had this happen before the
whole time all those Democrats are
fighting each other for the primary for
the nomination he’s gonna be tweeting
the shit out of those debates he’s gonna
be live tweeting the debates right and
they’re not gonna they have to worry
about the tax from their colleagues but
also from the sitting president I was
like look at this dope and he’s gonna
come up with nicknames right now this
stick Danang dick he already did I’m
like it’s amazing to demand dick
Blumenthal senator from Connecticut lied
about his Vietnam service oh no I
started calling him Danang dick he lied
about his Vietnam service so got elected
shameless yeah how did he lie what did
he say he said he served and he didn’t
look it up yeah I mean it’s it’s it is
brazen it wasn’t some ambiguous area I
think he’s like he never left America is
my understanding oh yeah
legal experts are calling Monday’s missives a newsworthy development that amounts to evidence of obstructing justice.
Trump’s first statement went out after Michael Cohen, his former personal attorney who pleaded guilty last week for lying to Congress about the president’s real estate project in Russia. In his tweet, Trump alleged that Cohen lied to Mueller and called for a severe penalty, demanding that his former fixer “serve a full and complete sentence.”
.. After the overt attack on Cohen came a tweet encouraging Roger Stone, a longtime adviser to Trump, not to become a witness against him:
.. “We’re so used to President Trump transgressing norms in his public declarations,” Eisen said, “but he may have crossed the legal line.”
.. Respected figures across party lines also responded to Trump’s tweets on the social media platform.
Sen. Mark R. Warner (D-Va.) called it “serious,” adding that “the President of the United States should not be using his platform to influence potential witnesses in a federal investigation involving his campaign.”
.. Attorney George Conway, husband of White House counselor Kellyanne Conway, referenced the federal statute most likely to create legal liability for Trump: 18 U.S.C. §§ 1512, which outlines the crime of witness tampering.
The president has long sold himself as a self-made billionaire, but a Times investigation found that he received at least $413 million in today’s dollars from his father’s real estate empire, much of it through tax dodges in the 1990s.
.. Fred and Mary Trump, transferred well over $1 billion in wealth to their children, which could have produced a tax bill of at least $550 million under the 55 percent tax rate then imposed on gifts and inheritances.
The Trumps paid a total of $52.2 million, or about 5 percent, tax records show.
.. The Times’s findings raise new questions about Mr. Trump’s refusal to release his income tax returns, breaking with decades of practice by past presidents. According to tax experts, it is unlikely that Mr. Trump would be vulnerable to criminal prosecution for helping his parents evade taxes, because the acts happened too long ago and are past the statute of limitations. There is no time limit, however, on civil fines for tax fraud.
.. Most notably, the documents include more than 200 tax returns from Fred Trump, his companies and various Trump partnerships and trusts.
.. What emerges from this body of evidence is a financial biography of the 45th president fundamentally at odds with the story Mr. Trump has sold in his books, his TV shows and his political life. In Mr. Trump’s version of how he got rich, he was the master dealmaker who broke free of his father’s “tiny” outer-borough operation and parlayed a single $1 million loan from his father (“I had to pay him back with interest!”) into a $10 billion empire
.. In Mr. Trump’s version, it was always his guts and gumption that overcame setbacks. Fred Trump was simply a cheerleader.
.. “I built what I built myself,” Mr. Trump has said, a narrative that was long amplified by often-credulous coverage from news organizations, including The Times.
.. They described how Mr. Trump piggybacked off his father’s banking connections to gain a foothold in Manhattan real estate. They poked holes in his go-to talking point about the $1 million loan, citing evidence that he actually got $14 million. They told how Fred Trump once helped his son make a bond payment on an Atlantic City casino by buying $3.5 million in casino chips.
.. The reporting makes clear that in every era of Mr. Trump’s life, his finances were deeply intertwined with, and dependent on, his father’s wealth.
.. By age 3, Mr. Trump was earning $200,000 a year in today’s dollars from his father’s empire. He was a millionaire by age 8. By the time he was 17, his father had given him part ownership of a 52-unit apartment building. Soon after Mr. Trump graduated from college, he was receiving the equivalent of $1 million a year from his father. The money increased with the years, to more than $5 million annually in his 40s and 50s.
.. In one six-year span, from 1988 through 1993, Fred Trump reported $109.7 million in total income, now equivalent to $210.7 million. It was not unusual for tens of millions in Treasury bills and certificates of deposit to flow through his personal bank accounts each month.
.. Fred Trump was relentless and creative in finding ways to channel this wealth to his children. He made Donald not just his salaried employee but also his property manager, landlord, banker and consultant. He gave him loan after loan, many never repaid. He provided money for his car, money for his employees, money to buy stocks, money for his first Manhattan offices and money to renovate those offices. He gave him three trust funds. He gave him shares in multiple partnerships. He gave him $10,000 Christmas checks. He gave him laundry revenue from his buildings.
.. Much of his giving was structured to sidestep gift and inheritance taxes using methods tax experts described to The Times as improper or possibly illegal. Although Fred Trump became wealthy with help from federal housing subsidies, he insisted that it was manifestly unfair for the government to tax his fortune as it passed to his children.
When he was in his 80s and beginning to slide into dementia, evading gift and estate taxes became a family affair, with Donald Trump playing a crucial role, interviews and newly obtained documents show.
.. There is no shortage of clever tax avoidance tricks that have been blessed by either the courts or the I.R.S. itself. The richest Americans almost never pay anything close to full freight. But tax experts briefed on The Times’s findings said the Trumps appeared to have done more than exploit legal loopholes. They said the conduct described here represented a pattern of deception and obfuscation, particularly about the value of Fred Trump’s real estate, that repeatedly prevented the I.R.S. from taxing large transfers of wealth to his children.
“The theme I see here through all of this is valuations: They play around with valuations in extreme ways,” said Lee-Ford Tritt, a University of Florida law professor and a leading expert in gift and estate tax law. “There are dramatic fluctuations depending on their purpose.”
.. The Trumps dodged hundreds of millions in gift taxes by submitting tax returns that grossly undervalued the properties, claiming they were worth just $41.4 million.
The same set of buildings would be sold off over the next decade for more than 16 times that amount.
.. All told, The Times documented 295 streams of revenue that Fred Trump created over five decades to enrich his son.
.. as Donald Trump careened from one financial disaster to the next, his father found ways to give him substantially more money, records show. Even so, in 1990, according to previously secret depositions, Mr. Trump tried to have his father’s will rewritten in a way that Fred Trump, alarmed and angered, feared could result in his empire’s being used to bail out his son’s failing businesses.
Of course, the story of how Donald Trump got rich cannot be reduced to handouts from his father. Before he became president, his singular achievement was building the brand of Donald J. Trump, Self-Made Billionaire, a brand so potent it generated hundreds of millions of dollars in revenue through TV shows, books and licensing deals.
Constructing that image required more than Fred Trump’s money. Just as important were his son’s preternatural marketing skills and always-be-closing competitive hustle. While Fred Trump helped finance the accouterments of wealth, Donald Trump, master self-promoter, spun them into a seductive narrative. Fred Trump’s money, for example, helped build Trump Tower, the talisman of privilege that established his son as a major player in New York. But Donald Trump recognized and exploited the iconic power of Trump Tower as a primary stage for both “The Apprentice” and his presidential campaign.
.. on May 4, 2004, when Mr. Trump and his siblings sold off the empire their father had spent 70 years assembling with the dream that it would never leave his family.
Donald Trump’s cut: $177.3 million, or $236.2 million in today’s dollars.
They were both fluent in the language of half-truths and lies, interviews and records show. They both delighted in transgressing without getting caught. They were both wizards at manipulating the value of their assets, making them appear worth a lot or a little depending on their needs.
.. Emblematic of their audacity was Park Briar, a 150-unit building in Queens. As it happened, 18 days before Fred Trump Jr.’s death, the Trump siblings had submitted Park Briar’s co-op conversion plan, stating under oath that the building was worth $17.1 million. Yet as Fred Trump Jr.’s executors, Donald Trump and his fatherwhen Fred Trump Jr. died.
.. This fantastical claim — that Park Briar should be taxed as if its value had fallen 83 percent in 18 days — slid past the I.R.S. with barely a protest. An auditor insisted the value should be increased by $100,000, to $3 million.
.. During the 1980s, Donald Trump became notorious for leaking word that he was taking positions in stocks, hinting of a possible takeover, and then either selling on the run-up or trying to extract lucrative concessions from the target company to make him go away. It was a form of stock manipulation with an unsavory label: “greenmailing.” The Times unearthed evidence that Mr. Trump enlisted his father as his greenmailing wingman.
On Jan. 26, 1989, Fred Trump bought 8,600 shares of Time Inc. for $934,854, his tax returns show. Seven days later, Dan Dorfman, a financial columnist known to be chatty with Donald Trump, broke the news that the younger Trump had “taken a sizable stake” in Time. Sure enough, Time’s shares jumped, allowing Fred Trump to make a $41,614 profit in two weeks.
.. Later that year, Fred Trump bought $5 million worth of American Airlines stock. Based on the share price — $81.74 — it appears he made the purchase shortly before Mr. Dorfman reported that Donald Trump was taking a stake in the company. Within weeks, the stock was over $100 a share.
.. Fred Trump could be cantankerous and cruel, according to sworn testimony by his relatives. “This is the stupidest thing I ever heard of,” he’d snap when someone disappointed him. He was different with his son Donald. He might chide him — “Finish this job before you start that job,” he’d counsel — but more often, he looked for ways to forgive and accommodate.
.. By 1987, for example, Donald Trump’s loan debt to his father had grown to at least $11 million. Yet canceling the debt would have required Donald Trump to pay millions in taxes on the amount forgiven. Father and son found another solution, one never before disclosed, that appears to constitute both an unreported multimillion-dollar gift and a potentially illegal tax write-off.
.. Most, if not all, of his investment, which totaled $15.5 million, was made by exchanging his son’s unpaid debts for Trump Palace shares, records show.
.. Under I.R.S. rules, selling shares worth $15.5 million to your son for $10,000 is tantamount to giving him a $15.49 million taxable gift. Fred Trump reported no such gift.
.. Fred Trump evaded the 55 percent tax on gifts, saving about $8 million. At the same time, he declared to the I.R.S. that Trump Palace was almost a complete loss — that he had walked away from a $15.5 million investment with just $10,000 to show for it.
Federal tax law prohibits deducting any loss from the sale of property between members of the same family, because of the potential for abuse. Yet Fred Trump appears to have done exactly that, dodging roughly $5 million more in income taxes.
.. At its heart lay a more ambitious project, executed to perfection over decades — to create that origin story, the myth of Donald J. Trump, Self-Made Billionaire.
.. Donald Trump built the foundation for the myth in the 1970s by appropriating his father’s empire as his own.
.. Through it all, Fred Trump played along. Never once did he publicly question his son’s claim about the $1 million loan.
.. Fred Trump believed that the document potentially put his life’s work at risk.
.. did many things. It protected Donald Trump’s portion of the inheritance from his creditors and from his impending divorce settlement with his first wife, Ivana Trump. It strengthened provisions in the existing will making him the sole executor of his father’s estate. But more than any of the particulars, it was the entirety of the codicil and its presentation as a fait accompli that alarmed Fred Trump
.. He confided to family members that he viewed the codicil as an attempt to go behind his back and give his son total control over his affairs. He said he feared that it could let Donald Trump denude his empire, even using it as collateral to rescue his failing businesses. (It was, in fact, the very month of the $3.5 million casino rescue.)
.. The lawyers quickly drafted a new codicil stripping Donald Trump of sole control over his father’s estate. Fred Trump signed it immediately.
.. Yet for all the financial support he had lavished on his children, for all his abhorrence of taxes, Fred Trump had stubbornly resisted his advisers’ recommendations to transfer ownership of his empire to the children to minimize estate taxes.
.. With every passing year, the actuarial odds increased that Fred Trump would die owning apartment buildings worth many hundreds of millions of dollars, all of it exposed to the 55 percent estate tax. Just as exposed was the mountain of cash he was sitting on.
.. Even after he paid himself $109.7 million from 1988 through 1993, his companies were holding $50 million in cash and investments
‘A DISGUISED GIFT’
A family company let Fred Trump funnel money to his children by effectively overcharging himself for repairs and improvements on his properties.
.. All County’s main purpose, The Times found, was to enable Fred Trump to make large cash gifts to his children and disguise them as legitimate business transactions, thus evading the 55 percent tax.
.. All County’s invoices were padded, marked up by 20 percent, or 50 percent, or even more, records show.
.. Years later, in his deposition during the dispute over Fred Trump’s estate, Robert Trump would say that All County actually saved Fred Trump money by negotiating better deals. Given Fred Trump’s long experience expertly squeezing better prices out of contractors, it was a surprising claim. It was also not true.
.. In 1991 and 1992, Fred Trump bought 78 refrigerator-stove combinations for Beach Haven from Long Island Appliance Wholesalers. The average price was $642.69. But in 1993, when he began paying All County for refrigerator-stove combinations, the price jumped by 46 percent.
.. Likewise, the price he paid for trash-compacting services at Beach Haven increased 64 percent. Janitorial supplies went up more than 100 percent. Plumbing repairs and supplies rose 122 percent.
.. While All County was all upside for Donald Trump and his siblings, it had an insidious downside for Fred Trump’s tenants.
.. One way to justify a rent increase was to make a major capital improvement. It did not take much to get approval; an invoice or canceled check would do if the expense seemed reasonable.
.. As Robert Trump acknowledged in his deposition, “The higher the markup would be, the higher the rent that might be charged.”
.. the Trumps got approval to raise rents on thousands of apartments by claiming more than $30 million in major capital improvements.
.. By 1998, records show, All County and Apartment Management were generating today’s equivalent of $2.2 million a year
.. According to Fred Trump’s 1995 gift tax return, obtained by The Times, the Trumps claimed that properties including 25 apartment complexes with 6,988 apartments — and twice the floor space of the Empire State Building —
.. The Trumps used Robert Von Ancken, a favorite of New York City’s big real estate families. Over a 45-year career, Mr. Von Ancken has appraised many of the city’s landmarks
.. buildings in the same neighborhood as Trump buildings sold for two to four times as much per square foot as Mr. Von Ancken’s appraisals
.. Of all Fred Trump’s properties, Patio Gardens was one of the least profitable, which may be why he decided to use it as a tax deduction. In 1992, he donated Patio Gardens to the National Kidney Foundation of New York/New Jersey, one of the largest charitable donations he ever made. The greater the value of Patio Gardens, the bigger his deduction. The appraisal cited in Fred Trump’s 1992 tax return valued Patio Gardens at $34 million, or $61.90 a square foot.
By contrast, Mr. Von Ancken’s GRAT appraisals found that the crown jewels of Fred Trump’s empire, Beach Haven and Shore Haven, with five times as many apartments as Patio Gardens, were together worth just $23 million, or $11.01 per square foot.
.. Mr. Von Ancken claimed that they were worth less than nothing — negative $5.9 million, to be exact.
.. a bank would value at $106.6 million in 2004.
..The I.R.S. has long accepted the idea that ownership with control is more valuable than ownership without control. Someone with a controlling interest in a building can decide if and when the building is sold, how it is marketed and what price to accept
.. the Trumps set out to create the fiction that Fred Trump was a minority owner. All it took was splitting the ownership structure of his empire. Fred and Mary Trump each ended up with 49.8 percent of the corporate entities that owned his buildings. The other 0.4 percent was split among their four children.
.. That enabled the Trumps to slash Mr. Von Ancken’s valuation in a way that was legally dubious. They claimed that Fred and Mary Trump’s status as minority owners, plus the fact that a building couldn’t be sold as easily as a share of stock, entitled them to lop 45 percent off Mr. Von Ancken’s $93.9 million valuation. This claim, combined with $18.3 million more in standard deductions, completed the alchemy of turning real estate that would soon be valued at nearly $900 million into $41.4 million.
.. The I.R.S. determined that the Trumps’ assets were worth $57.1 million, 38 percent more than the couple had claimed. From the perspective of an I.R.S. auditor, pulling in nearly $5 million in additional revenue could be considered a good day’s work. For the Trumps, getting the I.R.S. to agree that Fred Trump’s properties were worth only $57.1 million was a triumph.
.. The next year, 1998, Donald Trump’s share amounted to today’s equivalent of $9.6 million, The Times found.
This sudden influx of wealth came only weeks after he had published “The Art of the Comeback.”
.. “I learned a lot about myself during these hard times,” he wrote. “I learned about handling pressure. I was able to home in, buckle down, get back to the basics, and make things work. I worked much harder, I focused, and I got myself out of a box.”
Over 244 pages he did not mention that he was being handed nearly 25 percent of his father’s empire.
.. The man who paid himself $50 million in 1990 died with just $1.9 million in the bank.
.. According to his estate tax return, his most valuable asset was a $10.3 million I.O.U. from Donald Trump, money his son appears to have borrowed the year before Fred Trump died.
..In 2003, the Trump siblings gathered at Trump Tower for one of their periodic updates on their inherited empire.
.. Donald Trump insisted that the real estate market had peaked and that the time was right
.. He was also, once again, in financial trouble. His Atlantic City casinos were veering toward another bankruptcy. His creditors would soon threaten to oust him unless he committed to invest $55 million of his own money.
.. Schron paid $705.6 million for most of the empire, which included paying off the Trumps’ mortgages.
.. Within a year of the sale, Mr. Trump spent $149 million in cash on a rapid series of transactions that bolstered his billionaire bona fides. In June 2004 he agreed to pay $73 million to buy out his partner in the planned Trump International Hotel & Tower in Chicago.
.. The first season of “The Apprentice” was broadcast in 2004, just as Donald Trump was wrapping up the sale of his father’s empire.
.. Had Mr. Trump done nothing but invest the money his father gave him in an index fund that tracks the Standard & Poor’s 500, he would be worth $1.96 billion today.