Magazine article Newsweek

A People's History of Donald Trump's Business Busts and Countless Victims; the Republican Nominee's Destructive Behavior Has Victimized Cities, Businesses, Investors, Partners and Even Members of His Own Family

Magazine article Newsweek

A People's History of Donald Trump's Business Busts and Countless Victims; the Republican Nominee's Destructive Behavior Has Victimized Cities, Businesses, Investors, Partners and Even Members of His Own Family

Article excerpt

Byline: Kurt Eichenwald

Dust swirled and jackhammers pounded outside the Bonwit Teller building in Manhattan as undocumented immigrants tore apart the facade. It was June 5, 1980, and a sense of bitterness hung over the work site that afternoon; paychecks were often weeks late, but since the Poles didn't have legal status in the United States, there was little they could do about it.

The exterior they were destroying was an architectural masterpiece--bronze, platinum, hammered aluminum, glazed ceramic and tinted glass that shimmered like jewelry. Many New Yorkers had hoped the grandest portion would survive; curators from the Metropolitan Museum of Art had asked the developer to carefully remove the two bas-relief sculpture panels so they could be restored and put on public display. But that afternoon, the laborers, acting on orders from the developer, smashed the 50-year-old art deco panels into a rubble of stone, pebble and dirt.

The desecration horrified Manhattan's art community, but the developer, a brash 34-year-old named Donald Trump, dismissed the criticism--pretending to be his own spokesman, "John Barron," as he talked to reporters by phone. Saving the panels would have cost him $32,000 each, he said, and delayed work for a few days on his $100 million project, Trump Tower. Besides, he declared, he knew more than the curators--the panels had no artistic merit and little financial value.

This incident from long before Trump became a household name is an ideal exemplar for his business career, in which he has repeatedly left bitterness and ruin in his wake. His destructive behavior--spurred by recklessness, arrogance and an unslakable thirst for vengeance--has victimized cities, businesses, investors, partners, even members of his family.

Trump is now completing his biggest and most astonishing demolition: tearing down the Republican Party. Since the disclosure of a recording earlier this month in which Trump demeans women and boasts of sexually assaulting them, the GOP presidential nominee has vowed to make his campaign a scorched-earth mission. He now speaks of vast conspiracies against him involving bankers, the media and politicians, while raging against Republicans who have pulled away from his toxic campaign, ripping open chasms between his zealous supporters and the GOP. Win or lose on November 8, Trump, whose campaign did not respond to Newsweek requests for comment about this article, will leave the Republican Party as damaged as those art deco panels were 36 years ago.

To anyone who has watched Trump over the past four decades, none of this is a surprise. His presidential campaign is built on the claim that he's a brilliant businessman worth $10 billion who turns every challenge into success, but Trump is none of those things. Instead, he was born into an exceedingly wealthy family and tried to build upon his father's success with ever-riskier ventures, and by any rational measure, he failed again and again.

He'd have done better if he'd never gone into business. In 1982, Trump reported to New Jersey regulators a personal net worth of $321 million, built largely on his father's connections, as well as loans and guarantees for bank credit. Two years later, a Trump lieutenant testified that his worth had not changed much. In 2004, in reviewing his application for a loan, Deutsche Bank concluded he was worth $788 million. Trump now makes the highly dubious claim that he is worth $10 billion; Forbes estimates that the real number is $3.7 billion. That's a lot of money, to be sure, but suppose Trump had never done any deals and instead sold all of his assets back in 1982 and invested them in a fund based on the Standard & Poor's 500 index. With dividends reinvested, he would have increased his wealth to $535 million by 1985. By 2004, his personal wealth would have increased to $5.9 billion. And three years ago, he would have exceeded what he claims to be worth now by more than $1 billion; today, he would be worth more than $13 billion, just under three times the Forbes estimate. …

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