OK, Trump Was A Bad Businessman-- But Is He Also A Crook?
Right on top of the media onslaught involving Trump's exaggerations that he was a competent and supremely successful businessman-- claims that are not backed up by the facts that come from any place other than himself-- a view into his business model hit the press in a big way: ripping off small businesses. Both USA Today and the Wall Street Journal ended the week with exposes of Trump refusing to pay bills from contractors based on... nothing more than his ability to get away with it.
USA Today reported that Trump has been casting himself as a protector of workers and jobs, but their investigation found hundreds of people-- carpenters, dishwashers, painters, even his own lawyers-- who say he didn’t pay them for their work. The video above-- from Morning Joe Friday, tells one of the stories. And the Wall Street Journal's Alexandra Berzon filled in the blanks about how Trump operated his shady businesses: unpaid bills.
Donald Trump often boasts on the presidential campaign trail that hardball tactics helped make him a successful businessman, an approach many voters say they admire. Those tactics have also left behind bitter tales among business owners who say he shortchanged them.Trump has admitted-- even bragged-- that if a contractor do "merely" a satisfactory job (in his opinion) he'll refuse to pay the full contact. Berzon quoted Trump: "'If they do a good job, I won’t cut them at all,' Mr. Trump said of businesses he contracts with, saying 'it’s probably 1,000 to one where I pay.' He said he occasionally won’t pay fully when work is simply satisfactory or 'an OK to bad job…If it’s OK, then I’ll sometimes cut them.' In dealing with public projects such as bridge-building, he said, 'that should be the attitude of the country. I pay thousands of bills on time,' he said, adding that suggesting otherwise is 'disgusting.'"
A review of court filings from jurisdictions in 33 states, along with interviews with business people, real-estate executives and others, shows a pattern over Mr. Trump’s 40-year career of his sometimes refusing to pay what some business owners said Trump companies owed them.
A chandelier shop, a curtain maker, a lawyer and others have said Mr. Trump’s companies agreed to buy goods and services, then reneged when some or all were delivered.
Trump’s withholding of payments stood out as particularly aggressive in the industry and in the broader business world, said some vendors who had trouble getting paid.And he often decided to "be cute," especially with small businessmen he judged didn't have the financial resources for expensive, prolonged court battle. One thing that is completely clear is that Trump's word is worthless if he can get away with ripping off anyone he gets involved with. His classic bullying tactics have always been predatory and aimed at finding people who couldn't defend themselves against his amoral power and ruthlessness. He brags he intends to run America this way. Who would have imagined a race where a question of character actually makes Hillary Clinton look better than an opponent?
It is “a strong-arm tactic that is frowned on,” said Wayne Rivers, a small-business consultant in construction. The tactic is more common in Northeast construction than in other regions, he said, and is abnormal in much of American business.
Mr. Trump pushed the approach beyond construction and into day-to-day casino operations, said Jack O’Donnell, president of Mr. Trump’s Plaza casino in Atlantic City in the late 1980s. “Part of how he did business as a philosophy was to negotiate the best price he could. And then when it came time to pay the bills,” he said, Mr. Trump would say that "'I’m going to pay you but I’m going to pay you 75% of what we agreed to.'"
“In our business it’s very difficult to operate that way. You’re dealing with people on an ongoing basis. Every time you order with them you can’t screw them because they won’t be your suppliers anymore,” Mr. O’Donnell said. Executives at the casino paid vendors fully despite Mr. Trump’s directives, he said, and “it used to infuriate him.”
...Trump has written frequently about playing hardball. “You have to be very rough and very tough with most contractors or they’ll take the shirt right off your back,” he wrote in his 1987 book The Art of the Deal. In his 2004 book Trump: Think Like a Billionaire, he wrote to “always question invoices.”
...Trump’s best-known payment dispute was in Atlantic City in the early 1990s, when Trump executives told contractors working on his Taj Mahal casino they should agree to accept less than full payment or risk becoming unsecured creditors in bankruptcy court. In 1991, the Taj filed for bankruptcy.
Mr. Trump said in a Journal interview last year that those who lost out in the Taj probably wouldn’t have had jobs or contracts in the first place if it weren’t for him.
Vendors with legal muscle have sometimes had better luck collecting, including several that sued Trump University, the now-defunct real-estate school. The MGM Grand in Las Vegas sued Trump University in Clark County, Nev., court in 2009 for allegedly failing to pay a $12,359.51 fee for a canceled event. The casino was paid and dropped the suit, an MGM spokesman said.
Mr. Trump said of Trump University’s bills: “Everybody has been paid in full. I didn’t have to do that either. I wouldn’t have to pay anybody if I wanted to be cute.”