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By Timothy L. O’Brien
Donald Trump is the luckiest man alive. Unlike almost, well, everyone, he’s been protected from the consequences of his own mistakes his entire life.
Born into a wealthy family, his father’s money insulated him from lukewarm academic prospects and serial business outbursts. (“I often say that I am a member of the lucky sperm club,” he put it in one of his books). Emerging as a reality TV star in the early 2000s, Trump discovered that fame allowed him to be as predatory as he pleases without repercussions. (“When you’re a star, they let you do it”). And his accession to the White House in 2016 opened his eyes to the legal armor of the presidency, which he interpreted broadly and often inaccurately. (“I have an Article II, where I have the right to do what I want as president”).
Although over the years Trump has juggled, among other difficulties, boring grades, the threat of personal bankruptcy, sexual assault allegations, an intensive federal investigation, and impeachment, he has moved on relatively unscathed and free of regret. Wealth, fame and the presidency have kept him optimistic. All that isolation has also meant that he hasn’t learned from his mistakes. All personal and public reckoning has been postponed or shelved.
Now, however, Trump is looking at two looming threats after he leaves the White House in January. One is financial, the other legal. Neither is completely under your control. And both can help explain, along with his perennial inability to accept losing, why Trump will not acknowledge that President-elect Joe Biden will succeed him and why he has enlisted the Republican Party to help him clarify to Americans about the outcome of the presidential elections.
Trump and the mosaic of businesses he houses within the Trump Organization are over a billion dollars in debt, which Dan Alexander of Forbes has kindly counted. A portion of that total has been disclosed over the past few years in the president’s personal financial disclosures on file with the Office of Government Ethics. The New York Times recently revealed that Trump has personally guaranteed at least $ 421 million of the debt, with more than $ 300 million maturing in four years.
In other words, Trump is hooked on a lot of money that he may have to fight to pay back in an economy hit by COVID-19 in which his industries (hotels, entertainment, urban real estate) have been particularly hard hit. Forbes estimates its assets are worth $ 3.7 billion; Bloomberg News pegs them at around $ 3.2 billion. It will not be ruined. But if the economy continues to struggle in the months ahead, those valuations will be put to the test. And much of what Trump has is illiquid, which means he may have a hard time selling assets quickly if he needs to raise funds. Among Trump’s most valuable holdings, for example, are minority stakes in two properties controlled by the Vornado Realty Trust. Rumors of dismissed sales could further depress the value of your portfolio.
Another thing that would weaken Trump’s ability to negotiate kind financial deals or pardons: leaving the presidency.
On the legal side of the ledger, Trump, his children and his company face aggressive investigations into their finances, accounting practices, and tax payments.
The Manhattan District Attorney’s Office is investigating Trump for possible tax fraud and falsification of business records, according to appeals court documents. In this investigation, which also examines the president’s payment of silence money to two women who allegedly had sexual encounters with him, the prosecutor’s office is looking for eight years of Trump’s tax returns. He is also looking at whether Trump inflated the value of his properties and other assets to secure funds from lenders and investors.
New York Attorney General Letitia James launched another investigation, also focused on whether the Trump Organization and the Trump family manipulated valuations to secure funds or generate tax benefits. James’ investigation is a civil case, which could carry heavy financial penalties against Trump, but not prison time (unless she finds reasons to recast it as a criminal case). However, the Vance investigation is a criminal matter, and if Trump’s crew is found guilty of serious crimes, prison time is on the table.
Trump’s team has fought hard against the Vance investigation, including arguing before the US Supreme Court that a sitting president is immune from state criminal prosecutions. While the court rejected that notion in a landmark ruling over the summer, it would become a moot argument anywhere once Trump is no longer president.
A Trump pushed out of the legal moat surrounding the White House becomes, for the most part, a Trump who can be sued and penalized like any other American. That could also give new impetus to sexual assault cases against you.
It’s unclear how aggressive law enforcement officials in the Biden administration will be toward Trump. They could resurrect some of the obstruction charges that have been lying fallow since former special counsel Robert Mueller ended his investigation. On the other hand, the political storm that could ignite could persuade Biden to hold back.
What is clear is that Trump’s money and freedom are at stake. As he faces losing the 2020 election, he will continue to respond in fierce and unpredictable ways, like a man who for 74 years has been used to getting his way with just about anything.
Timothy L. O’Brien is a senior columnist for Bloomberg Opinion.
© 2020 Bloomberg LP
