Donald Trump May Be One of the Biggest Losers in America
The
“VERY successful businessman” only paid income tax twice between 1985
and 1994—and lost more money than “nearly any other individual American
taxpayer.”
Donald Trump stands inside the casino of the Trump Taj Mahal on March 16, 1990.
By Joe Dombroski/Newsday LLC/Getty Images.
President Donald Trump's ever-elusive tax returns got slightly demystified Tuesday, as the New York Times released a report
detailing one decade of Trump's finances from his days as a real estate
tycoon. And, spoiler alert: he's not the “VERY successful businessman”
he's claimed to be. According to the Times
report, which is based on printouts from Trump’s official Internal
Revenue Service tax transcripts, rather than the actual tax returns
themselves, the now-president lost $1.17 billion from 1985 to 1994—more
money than “nearly any other individual American taxpayer.”
Per the Times,
Trump's startling losses came from of a rash of unprofitable business
purchases, largely in real estate, that included a shuttle operation
from Eastern Airlines funded at a rate of $7 million per month and the
Trump Taj Mahal Hotel and Casino, which opened with $800 million in
debt. The casino never recouped its debts, the Times found,
“and sucked revenue from [Trump's] other casinos, Trump’s Castle and
Trump Plaza, pulling them deep into the red.” By 1990, Trump's adjusted
gross income was negative $400.3 million, which would balloon to
negative $915.7 million by 1994. (An earlier Times report
found Trump's 1995 adjusted gross income was negative $916 million, an
amount then described as “so substantial it could have allowed him to
legally avoid paying any federal income taxes for up to 18 years.”) As a
result of his “overwhelming losses,” the Times found that
Trump didn't pay income tax for eight of the ten years reviewed, only
paying income tax in 1987 and 1988. Trump was required to pay taxes both
years through the alternative minimum tax, which, as the Times described, “was created to make sure wealthy people could not avoid all income tax through loopholes and deductions.”
There were actually some ways that Trump made money in that decade, of course. The Times
report details income that “changed year after year,” including $67.1
million in salary in 1988, which largely came from a lucrative deal with
former T.V. host Merv Griffin for the Taj Mahal, and a
still-unexplained $52.9 million in interest income in 1989. Trump's
primary money-making scheme was as a “corporate raider,” in which Trump
would buy stock in companies to fuel speculation that he could buy the
company—only to drive up the stock price and then cash out. “But always,
those gains were overwhelmed by losses on his casinos and other
projects,” the Times said, and Trump “ultimately lost the bulk of the gains from his four-year trading spree.” As the Times
noted Tuesday, though, the now-president could stand to lose so much
money and keep up his gilded lifestyle, largely because the money he
lost wasn't actually his. Most of Trump's money “belonged to others,”
the Times found, “to the banks and bond investors who had
supplied the cash to fuel his acquisitions.” Trump also “secretly leaned
on his father’s wealth to continue living like a winner.”
The
Trump camp has disputed the findings as “demonstrably false,” though
they've yet to point out any specific falsehoods in the Times report. Trump lawyer Charles J. Harder said in a statement to the Times
that their statements “about the president’s tax returns and business
from 30 years ago are highly inaccurate,” later adding, “I.R.S.
transcripts, particularly before the days of electronic filing, are
notoriously inaccurate” and “would not be able to provide a reasonable
picture of any taxpayer’s return.” The Times has disputed that claim, citing Mark J. Mazur,
a former director of research, analysis and statistics at the I.R.S.,
who said such transcripts are referred to by I.R.S. auditors as “‘handy’
summaries of tax returns,” undergo quality control, and have been used
“to analyze economic trends and set national policy.”
The Times' tax report comes as the struggle to see Trump's current tax returns has only intensified. House lawmakers and state governments
alike have been hotly pursuing the closely-guarded documents, both
through investigations and legislation, and the Trump team has been
responded by ramping up its stonewalling to prevent the documents from
ever seeing the light of day. Treasury Secretary Steven Mnuchin officially refused to hand over Trump's tax returns to House lawmakers Monday—potentially risking jail time in doing so—and Trump and his family members have been desperately attempting to stop Deutsche Bank,
some of whose employees have seen the tax returns, from complying with a
congressional subpoena. While Trump's 1985-1994 tax returns don't
necessarily answer the questions about the Trump Organization's
modern-day dealings that investigators are hoping for from the current
tax returns, their debunking of Trump's wealth and business acumen
suggests there could be much more dirt left to find. The 1985-1994
returns “show that in fact Donald Trump is not the modern Midas who
turns everything to gold. He is the Wizard, and Toto in the form of the New York Times has pulled back the curtain and revealed the con man,” David Cay Johnston, a tax policy expert and author of The Making of Donald Trump, told MSNBC
Tuesday. When it comes to Trump, Johnston added, “Money . . . flows out
faster than it flows in. And one of the reasons we should be concerned
about that is someone who is constantly, desperately in search for money
to maintain the appearance that they're wealthy, is likely to commit
crimes and be open to various actions.”
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