Business and politics

The Trump Transition and Wage Theft

If Donald Trump really were a champion of the working class, one place you would expect to see it reflected would be in his plans for the Labor Department. The supposed champion of blue collar Americans should be making sure that the agency most concerned with the world of work is reoriented to their needs.

Given what we have learned about the Trump transition so far, it will come as no surprise to hear that things seem to be moving in a very different direction. The person put in charge of the DOL transition is J. Steven Hart, chairman of the firm of Williams & Jensen, which calls itself “Washington’s Lobbying Powerhouse.” Hart is a lawyer and an accountant who worked in the Reagan Administration but his firm now lobbies mainly on behalf of large corporations such as the health insurer Anthem and Smithfield Foods.

He may provide other services for big business. In a 2007 article in The Washingtonian about DC’s top lobbyists, Hart was described as “the man corporations call when they are having trouble with labor unions.” There is not much in the public record on Hart’s activity as a union buster, which may mean only that he worked behind the scenes.

One thing that is known, according to the BNA Daily Labor Report, is that Hart has lobbied recently on behalf of the International Association of Amusement Parks and Attractions (IAAPA) on the rule formulated by the Labor Department to update overtime eligibility to thwart abusive employer practices. That association has made no secret of its strong opposition to the rule, which is scheduled to take effect on December 1. It put out a press release denouncing the rule as “burdensome” and vowing to work with other business interests to fight it.

The board of directors of the IAAPA includes a representative of the Walt Disney Company, which had has compliance problems with the Fair Labor Standards Act. For example, in 2010 Disney agreed to pay more than $433,000 in back wages to settle DOL allegations regarding off-the-clock work.

The overtime rule is a glaring example of the contradictions in the emerging Trump Administration. The rule would be of enormous benefit to many struggling lower-income workers who are denied overtime compensation under exemptions that were supposed to apply only to high-paid salaried employees. Their plight has amounted to a form of wage theft.

One group of employers that have frequently been implicated in overtime abuses are dollar store chains such as Family Dollar and Dollar Tree. These cases often involve assistant managers who are not really managers and are compelled to perform routine tasks in stores that are chronically understaffed. After losing an overtime lawsuit and hit with $36 million in damages, Family Dollar appealed the case all the way to the Supreme Court (and lost).

It’s likely that Trump supporters are a lot more familiar with dollar stores than those who voted for Clinton. Do they really want to make it easier for those corporations to engage in wage theft against relatives and friends?

A Mandate for Corporate Misconduct?

Many analysts of the presidential election are depicting it as a victory for workers, at least the disaffected white portion of the labor force. It remains to be seen whether Trump can deliver much in the way of concrete economic benefits for them.

Trump’s triumph may actually turn out to be a bigger boon for corporations. Although his candidacy was not actively supported by much of big business, which remains nervous about his posture on trade, Trump put forth other arguments that evoke less a populist uprising than the lobbying agenda of the U.S. Chamber of Commerce , which has just issued a statement embracing the election results for preserving “pro-business majorities” in the Senate and the House.

Trump’s position on big business has been difficult to pin down. He has often criticized crony capitalism but it has usually been part of attacks on Hillary Clinton or the Obama Administration. He has criticized some companies for sending jobs offshore yet has made tax proposals that would be a windfall for Corporate America.

One area in which Trump’s position has been unambiguously pro-corporate is the issue of regulation, where his stance has been indistinguishable from the Chamber and its allies. Trump has expressed a broad-brush condemnation of federal rules as job-killing, using the usual bogus numbers on their economic costs while ignoring the benefits. He has vowed both to eliminate many of the Obama Administration’s initiatives and to put a moratorium on most new rules. Trump has called for slashing the budget of the Environmental Protection Agency and for repealing much of Dodd-Frank, which could mean the demise of the Consumer Financial Protection Bureau.

Trump’s embrace of traditional Republican regulation bashing is all the more troubling as it comes at a time when corporate misconduct remains rampant. It is remarkable that so little attention was paid during the campaign to the scandals involving companies such as Volkswagen, whose emissions fraud has been pursued by the EPA, and Wells Fargo, which was fined $100 million by the CFPB for creating millions of bogus accounts. By threatening these agencies , Trump is undermining future cases against other corporate miscreants.

It’s possible that Trump’s attacks on regulation are nothing more than campaign rhetoric, but he is now allied with those pro-business majorities in Congress that are dead serious about dismantling as much of the federal regulatory framework as possible. Corporate lobbyists must be salivating at what lies ahead.

Is that what Trump supporters signed up for? Do residents of oil and gas states whose water supplies have been contaminated want the EPA to dwindle? Do blue collar workers confronted by predatory lending practices want the CFPB to disappear? Do families with serious health problems want to go back to a system in which insurance companies can discontinue their coverage? Do victims of wage theft want to see funding cut for the Wage & Hour Division of the Labor Department?

Trump has promised to drain the swamp in Washington, yet when it comes to regulation at least he has jumped into the muck feet first and is already becoming part of the problem rather than the solution.

Note: For a reminder of the myriad ways in which the Trump Organization itself has run afoul of federal, state and local regulations, see my Corporate Rap Sheet on the company.

Corporate Criminals and Public Office

Donald Trump’s candidacy is based to a great extent on the notion that a successful businessman would make an effective President. Democrats have shot holes in Trump’s claims of success, but they have not done enough to attack the underlying claim that private sector talents are applicable to the public realm.

The conflation of business and government acumen is all the more dangerous at a time when the norm in the corporate world is increasingly corrupt. The observation by Bernie Sanders during the primaries that “the business model of Wall Street is fraud” applies well beyond the realm of investment banking. Have those calling for government to operate more like business been paying attention to Wells Fargo, Volkswagen and EpiPen-producer Mylan?

It used to be that the main threat was that unscrupulous corporations would use investments in the political and legislative process to bend policymaking to favor their interests. Trump has shown that a corporate miscreant can use a pseudo-populist platform to try to take office directly.

Trump is not unique in this regard. Take the case of West Virginia, where a controversial billionaire coal operator is leading the polls in the state’s gubernatorial race. Jim Justice brags that he is a “career businessman” not a career politician, yet that career includes racking up some $5 million in fines imposed by the Mine Safety and Health Administration, according to Violation Tracker. To make matters worse, NPR and Mine Safety News reported in 2014 that Justice resisted paying these fines. An NPR update says that $2.6 million in MSHA fines and delinquency penalties remain unpaid even as the Justice mining operations continue to get hit with more safety violations.

On top of this, NPR estimates that the Justice companies face more than $10 million in federal, state and county liens for unpaid corporate income, property and minerals taxes. About one-third of the total is owed to poor West Virginia counties. Like Donald Trump, Justice has failed to follow through on charitable commitments yet has managed to pump several million dollars into his campaign.

Did I mention that Justice is the Democratic candidate? He is not, however, supporting Hillary Clinton though he is tight with conservative Democrat Sen. Joe Manchin. Justice’s Republican opponent is state senate president Bill Cole, whose super PAC received a $100,000 contribution from a super PAC funded by the Koch brothers. This was after Cole spoke at the Koch’s private conservative donors conference in Palm Springs last February, reportedly using his remarks to emphasize his commitment to getting a “right to work” law passed in West Virginia. While in the legislature Cole has also been cozy with the American Legislative Exchange Council and has pushed the crackpot supply-side economic prescriptions of Arthur Laffer. Cole is also an enthusiastic supporter of Trump.

It is difficult to know which is worse: a candidate in the pocket of unscrupulous corporate special interests or one who is himself one of those corporate miscreants. It is troubling to think that our elections increasingly come down to such an untenable choice.

The Real Crime Wave

Donald Trump’s recent economic policy address portrayed an economy crippled by “overregulation.” This came on the heels of his convention acceptance speech depicting a country afflicted by a wave of street crime perpetrated by “illegal immigrants.”

As with most of Trump’s statements, these comments took real issues and distorted them to the point that that they no longer had much resemblance to reality. There is a regulation crisis in the United States, but the problem is inadequate business oversight, not an excess. And there is a crime wave taking place, but the culprits are not immigrants but rather rogue corporations.

It was particularly odd that Trump chose to mention the auto industry in his rant on regulation. It has apparently not come to his attention that just about all the major carmakers are embroiled in some of the biggest safety and compliance scandals in the industry’s history.

Volkswagen exhibited contempt for the law in its long-standing scheme to circumvent auto emission standards. Since the brazen cheating came to light the company has been scrambling to make amends. It had to agree to spend nearly $15 billion (mostly to compensate customers) to resolve some of its legal entanglements, and it may still face criminal charges with larger potential penalties. While the amounts may seem high, VW is lucky it is being allowed to remain in business.

Then there’s the Japanese company Takata, whose airbags have turned out to be deadly and now is reported to have routinely manipulated test results of its products. General Motors had to pay a $900 million fine and Toyota $1.2 billion, both for safety reporting deficiencies. Electric car producer Tesla, which has taken advantage of a lax regulatory regarding self-driving technology, now faces scrutiny in the wake of several serious accidents involving vehicles operating on autopilot.

Automobiles are far from the only industry with serious regulatory compliance problems. In case we had forgotten the severity of the 2010 Deepwater Horizon catastrophe in the Gulf of Mexico, BP provided a reminder recently when it estimated that its legal and clean-up costs will reach more than $61 billion.

And we must not leave out the banks. In a report I put out in June to accompany the expansion of Violation Tracker, I found that since the beginning of 2010 there have been 144 cases settled against major banks with penalties in excess of $100 million each. In all, the banks have had to pay $160 billion in these cases to resolve allegations relating to a wide range of misconduct: mortgage abuses, defrauding of investors, manipulation of foreign exchange markets and interest rate benchmarks, assisting tax evasion, and much more.

Rampant corporate misconduct is one of the missing issues of the presidential race, especially since Bernie Sanders dropped out. Hillary Clinton’s website has some decent language on the subject but she has hardly made it a central issue in her campaign. In her convention acceptance speech she presented an upbeat picture of American business, and her reference to the auto industry was not to criticize its misconduct but to celebrate that it “just had its best year ever.”

Neither Clinton nor Trump can be expected to be a crusader for corporate accountability, but we need to make sure that whoever is the next occupant of the White House feels pressure to rein in and not unleash big business.

Trump and the National Enquirer’s Mutual Admiration Society

Donald Trump’s verbal assault on reporters who dared to ask question about his charitable activities displays a contempt for the media comparable to that of Richard Nixon and Spiro Agnew. Yet there is one media outlet for which the presumptive Republican nominee seems to have unbounded affection: the National Enquirer.

Much has been written about Trump’s fascination with the supermarket tabloid, usually with the assumption that it is simply an indication of low-brow reading habits. Yet there is more to Trump’s relationship with the current and former principals at the Enquirer that bears closer scrutiny.

Trump is apparently close with David Pecker, chief executive of American Media Inc., parent of the Enquirer and other tabloids. In 2010 New York’s Pace University announced that it would pay tribute to Pecker (an alumnus) and that the award would be presented by Trump, “a long-time friend and business associate.”

Last August, the New York Daily News, also noting the relationship between the two men, reported that the Enquirer had decided not to subject Trump to the kind of sensationalized reporting that it had used in the past to sink the presidential ambitions of John Edwards and Gary Hart. In fact, the Enquirer has published self-aggrandizing pieces written by Trump, attacked his Republican opponents and formally endorsed Trump, apparently the first time the tabloid has done so for a candidate.

American Media gained control of the Enquirer after the 1988 death of Generoso Pope Jr., who had purchased the publication in the early 1950s. The Enquirer had been founded in 1926 by William Griffin, a protege of William Randolph Hearst who shared the media baron’s isolationist views. Griffin was so outspoken in opposing U.S. involvement in World War II that he was among a group of people indicted in the 1940s for sedition and conspiring to impair the morale and loyalty of the armed forces. The charges against him were later dropped.

The Enquirer was struggling to survive when Pope acquired it, reportedly with the financial assistance of mobster Frank Costello, who was apparently close to Pope’s father, also named Generoso. The elder Pope was a political powerbroker in the Italian-American community as the publisher of the rightwing Italian-language newspaper Il Progresso. Until 1941 he was a supporter of Mussolini.

Along with his publishing enterprises, the elder Pope controlled Colonial Sand & Stone, which became the dominant ready-mix concrete provider in New York City. After his death, both Il Progresso and Colonial were taken over by his oldest son, Fortune Pope. Colonial retained its grip on New York’s construction industry until the 1970s and in all likelihood did business with Donald Trump’s father Fred and perhaps Donald himself during the early years of his career.

Meanwhile, Fortune’s eccentric brother Generoso turned the Enquirer into a thriving operation with a mix of sensationalism and scandal. It was not until American Media took it over that the publication began to dabble in political reporting and politics. Back in 1999, when Trump was considering his presidential bid, via the Reform Party, the Enquirer published a poll purportedly showing that the real estate developer would be a strong candidate. Trump, naturally, cited the poll in justifying his plans.

It is difficult to tell whether Pecker, who has made campaign contributions to prominent Democrats as well as Republicans, has been promoting Trump for ideological reasons or just because the colorful real estate developer and former reality TV star helps sell his publications. Pecker’s company used to publish Reality Weekly, which featured Trump during his “Apprentice” days. Earlier in his career, while at Hachette, Pecker published an in-house magazine called Trump Style that was distributed to visitors at Trump properties.

While the relationship between Pecker and Trump may have once been little more than matter of cross-marketing, its role in the current presidential race is a lot more troubling.

President or Pitchman?

In submitting his new financial disclosure form to the Federal Election Commission, Donald Trump described it as “the largest in the history of the FEC.” Aside from being another example of his compulsive need to boast, the statement seems to demonstrate an astounding ignorance of what the disclosure process is all about.

It also raises questions as to what Trump’s entire candidacy is all about. Since announcing his bid for the Republican nomination last June, Trump has made countless statements about his supposed business prowess and the success of his various enterprises. He even insisted that multiple corporate bankruptcies were indications of shrewdness rather than failure, and he downplayed the long series of controversies and scandals that have marked his business career.

Trump is not the first candidate to try to use a business track record as the springboard to the presidency. Mitt Romney did essentially the same thing, though in his case he had already distanced himself from Bain Capital and had transitioned to the public sector by serving as the governor of Massachusetts.

Yet in Trump’s case, the objective seems to be more than simply asserting his qualifications based on past business activities. To a great extent, he has used his candidacy to promote his current endeavors. He uses every opportunity to tout his portfolio of businesses, and in March he literally put his wares on display by holding a news conference surrounded by piles of Trump Steaks, Trump Wine and other branded products.

He has also employed the campaign to promote the size of his personal fortune, demonstrating a preoccupation with asserting a net worth of $10 billion in the face of substantially smaller estimates by the likes of Forbes ($4.5 billion) and Bloomberg ($2.9 billion). A decade ago, Trump brought an unsuccessful $5 billion defamation lawsuit against an author who claimed that he was actually worth less than a billion.

Initially, it appeared that Trump’s unrestrained comments about Mexicans would harm his business interests as companies such as NBC Universal, Univision, Macy’s and Serta cut ties with him. Yet the newly released disclosure form suggests something different. The Washington Post concludes that “business has boomed in Donald Trump’s financial empire during the time he has run for president.”

This raises the question: Is Trump primarily interested in serving the country or serving his business interests? The candidate seems to have done little to separate himself from those interests during the campaign. In 1992 Ross Perot resigned as CEO of his computer services company while running for the presidency. Trump has made no secret of the fact that he continues to be involved in commercial endeavors.

Trump has not committed to selling off his interests should he reach the White House. He has suggested that his adult children would get more involved in managing those operations, but it is difficult to believe that he would recuse himself to any great extent. Moreover, Trump’s businesses are so bound up with him personally — his name, his image, etc. — that it is difficult to see how he could separate himself even if he wanted to.

This brings us back to the financial disclosure form. Trump apparently views it as an opportunity to “document” his net worth, but the real purpose, of course, is to identify possible conflicts of interest. In Trump’s case, with hundreds of companies under his control and licensing deals with many others, those potential conflicts are endless.

Trump appears to be oblivious to the issue. If his goal was actually to make the Trump Organization, his holding company, great again, he may very well have succeeded. It remains to be seen how the rest of the country fares.

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Note: Subsidy Tracker, the corporate welfare database I produce with my colleagues at Good Jobs First, has reached two milestones: 500,000 entries and $250 billion in taxpayer-funded giveaways.

Trump’s Corporate Rap Sheet

For more than 30 years, Donald Trump has been almost continuously in the public eye, portraying himself as the epitome of business success and shrewd dealmaking.

He took a business founded by his father to build modest middle-class housing in the outer boroughs of New York City and transformed it into a high-profile operation focused on glitzy luxury condominiums, hotels, casinos and golf courses around the world. Operating through the Trump Organization, his family holding company, Trump also capitalized on his reality-TV-enhanced name recognition in a wide range of licensing deals.

Trump’s decision to enter the race for the Republican presidential nomination in 2015 has brought a great deal of new attention to his wide range of business activities and the controversies associated with many of them. Those controversies — involving issues such as alleged racial discrimination, lobbying violations, investor and consumer deception, tax abatements, workplace safety violations, union avoidance and environmental harm — are summarized in my new Corporate Rap Sheet on the Trump Organization. Here are some highlights:

In 1973 the Justice Department filed a suit in federal court accusing Donald Trump and his father Fred Trump of discriminating against African-Americans in apartment rentals, mostly in Brooklyn and Queens. Donald Trump vigorously disputed the charges and filed a $100 million countersuit while complaining that the government was trying to pressure him to rent to “welfare clients.” Trump claimed that doing so would be unfair to other tenants and warned that it would result in “massive fleeing.” In 1975 the Trumps signed an agreement with the Justice Department in which they did not admit to past discrimination but promised not to discriminate against African-Americans and other minorities in the future.
In 1991 the New Jersey Division of Gaming Enforcement announced that the Trump Castle Casino Resort, then owned by Donald Trump, would pay $30,000 as part of a settlement of a case in which Trump’s father was found to have improperly lent $3.5 million to the Atlantic City casino by purchasing gambling chips not intended to be used for bets. The transaction, designed to help the casino’s cash-flow problems, was allowed to proceed when Fred Trump agreed to apply for a license allowing him to lend money to the business.
In 1998 the Trump Taj Mahal, then still controlled by Trump, was fined $477,000 for currency transaction reporting violations. The Taj Mahal subsequently received numerous warnings about such issues, and in 2015, by which time it was controlled by Carl Icahn, the Atlantic City casino was fined $10 million for “willful and repeated violations of the Bank Secrecy Act.”
In 2000 Trump and some of his associates had to pay $250,000 and issue a public apology to resolve a case brought by the New York Temporary State Commission on Lobbying over the failure to disclose that they had secretly financed newspaper advertisements opposing casino gambling in the Catskills. Trump was said to have been concerned that Catskills casinos would siphon business from the Atlantic City casinos he owned at the time.
In 2002 the Securities and Exchange Commission announced that Trump Hotels and Casino Resorts had “recklessly” misled investors in a 1999 earnings release that used pro forma figures to tout the company’s purportedly positive results but failed to disclose that they were primarily attributable to an unusual one-time gain rather than ongoing operations. No penalty was imposed on the company, which consented to the SEC’s cease-and-desist order.
In 2013 New York Attorney General Eric Schneiderman filed a civil lawsuit against the Trump Entrepreneur Initiative (formerly known as Trump University), its former president and Donald Trump personally “for engaging in persistent fraudulent, illegal and deceptive conduct.” Schneiderman alleged that the business “misled consumers into paying for a series of expensive courses that did not deliver on their promises.” The suit asked for “full restitution for the more than 5,000 consumers nationwide who were defrauded of over $40 million in the scheme, disgorgement of profits, as well as costs and penalties and injunctive relief prohibiting these types of illegal practices going forward.” The case is pending.
In 2006 Donald Trump and the Los Angeles developer Irongate announced plans for a luxury condominium and hotel project in North Baja, Mexico, south of San Diego. Two years later, the San Diego Union-Tribune reported that the project still had not received all of its required permits and was falling behind schedule. In 2009, as the delayed continued, Trump removed his name from the project, which soon failed. Purchasers sued Trump, saying they were misled into thinking they were buying into a Trump development rather than one that simply licensed his name. In 2013 Trump reached a settlement with the plaintiffs; the details were not disclosed.
After dealers at the Trump Plaza voted overwhelmingly to join the United Auto Workers union in 2007, the management of the casino filed a challenge with the National Labor Relations Board. The UAW called the move an effort to delay collective bargaining. The stance of Trump management may have been a factor in the UAW’s narrow loss in a subsequent representation election at the Trump Marina. The vote at Trump Plaza was certified, but the UAW had difficulty negotiating a contract, even after the NLRB ordered the company to bargain in good faith. It appears that Trump managers dragged out the legal dispute until the Trump Plaza closed in 2014. In December 2015 the management of the non-casino Trump International Hotel Las Vegas challenged a vote by workers to be represented by the Culinary Workers Union Local 226 and the Bartenders Union Local 165 (photo). A hearing officer for the NLRB rejected the challenge, and the unions were certified in April 2016.
In April 2016 the U.S. Consumer Product Safety Commission announced that about 20,000 Ivanka Trump-branded women’s scarves made in China were being recalled because they did not meet federal flammability standards for clothing textiles, thus posing a burn risk. The importer of the scarves, GBG Accessories, has a licensing arrangement with Ivanka Trump, daughter of Donald Trump and an executive at the Trump Organization.

The full Corporate Rap Sheet on the Trump Organization can be found here.

Trump and Workplace Safety

trump_soho Like the other Republican candidates, Donald Trump bashes federal regulation of business. He’s called the Environmental Protection Agency “a disgrace,” saying it is “making it impossible” for companies to function. Yet it’s difficult to find any statements by Trump on another favorite regulatory whipping boy for conservatives: the Occupational Safety and Health Administration.

Trump’s silence on the subject is all the more significant given that in his business career he has had personal experience with workplace safety issues. Those dealings have not always put him in the best light.

The biggest controversy he has faced in this area involves the Trump SoHo New York. During construction of the high-rise hotel in January 2008, a portion of the top two floors buckled while concrete was being poured, sending one worker, Yurly Yanchytsky, plummeting 42 stories to his death and injuring three others, one of whom survived only because he fell into protective netting (photo).

All of the workers were employees of DiFama Concrete, a subcontractor which was charged by OSHA with various violations of regulations relating to cast-in-place concrete and fall protection. The agency initially imposed 10 violations with total penalties of $104,000. The company negotiated those down to five violations and penalties of $44,000.

This was not the first blemish on DiFama’s safety record. According to the OSHA inspection database, during the previous four years the company had been cited by OSHA for about a dozen serious violations and initially penalized $97,000 (negotiated down to about $67,000). One of those cases also involved a fatality. DiFama, by the way, was founded by Joseph Fama, who had been identified as an associate of the Lucchese organized crime family. In 2005 he divested his interest in the firm because he was being imprisoned after pleading guilty to federal racketeering and extortion charges.

Trump initially distanced himself from the accident, saying that he had simply licensed his name to the project. Yet the New York Daily News reported last year that a top official at Bovis Lend Lease, the general contractor for the project, stated in a deposition that Trump had personally reviewed the agreements with the subcontractors, including the one with DiFama. The Trump SoHo is currently listed on the Trump Organization website as part of its real estate portfolio and its hotel collection.

The SoHo hotel is not the only Trump-related property to have had problems with workplace safety. The OSHA inspection database lists other violations at places such as the Trump International Hotel & Tower Las Vegas. Undoubtedly, there are many more listed under the names of the contractors and subcontractors hired on the various projects. Inspection records from the 1980s show numerous violations at the Atlantic City casinos Trump owned at the time but subsequently had to sell.

Trump has boasted that he would be “the greatest jobs president that God has ever created.” It remains unclear how important it is to him that those jobs be free from undue safety and health risks.

Trump: The Art of the Tax Deal

Donald Trump is famous for making high-profile deals using other people’s money. Sometimes those other people are not his business partners or lenders but rather the taxpayers. For a figure who is seen to epitomize unfettered entrepreneurship, he has been relentless in his pursuit of government financial assistance.

Trump’s first major project, the transformation of the old Commodore Hotel next to New York’s Grand Central Station into a new 1,400-room Grand Hyatt, established the pattern. Trump arranged to purchase the property from the bankrupt Penn Central railroad and sell it for $1 to the New York State Urban Development Corporation, which agreed to award Trump a 99-year lease under which he would make gradually escalating payments in lieu of property taxes. The resulting $4 million per year tax abatement was criticized as excessive but was approved by the Board of Estimate in 1976. The deal also provided for profit sharing with the city. The total value of the abatement has been estimated from $45 million (Wall Street Journal, January 14, 1982) to $56 million.

In 1981 the New York Department of Housing Preservation and Development denied Trump’s request for a ten-year property tax abatement worth up $20 million on his project that replaced the old Bonwit Teller department store building with the glitzy Trump Tower. The decision came amid an effort by the city to rein in its abatement program, especially with regard to luxury projects. Trump, who in order to qualify had to argue that the property was underutilized as of 1971, filed suit and got a state judge to overrule the city and allow the abatement.

A state appeals court reversed that decision, pointing out that in 1971 the Bonwit Teller store on the site had gross sales exceeding $30 million and thus was not underutilized. Trump did not give up. He appealed to the state’s highest court, which in 1982 ordered the city to reconsider the application. When the city turned him down again, Trump went back to court and got a judge to order the city to grant the abatement.

Trump sought extensive tax breaks for his planned Television City mega-development on the Upper West Side of Manhattan that was designed to provide a new home for the NBC network, but in 1987 the city rejected the request. Mayor Ed Koch said: “Common sense does not allow me to give away the city’s Treasury to Donald Trump.” NBC decided to remain in Rockefeller Center.

Trump kept pushing for subsidies, and in 1993 he began withholding his tax payments to pressure officials to comply with his demands for tax breaks and state-backed financing. “I’ve always informed everyone that until such time that we get zoning and the economic development package together, to pay real-estate taxes would be foolish,” Trump told a New York Times reporter. A day later he said he had changed his mind and would pay the $4.4 million in back taxes he owed.

Trump later sought assistance for the project, renamed Riverside South, from the U.S. Department of Housing and Urban Development in the form of federal mortgage insurance, but he was rebuffed.

After Trump took over Washington’s Old Post Office Pavilion in 2012 to turn it into a luxury hotel, his company asked the DC government to forgo property taxes but it refused.

When Trump does not receive tax breaks he sometimes creates do-it-yourself subsidies by challenging the assessed value of his real estate holdings in order to lower his property tax bill. He has used this practice, which is employed by many other large corporations and property owners, in places such as Palm Beach. Trumped bragged that he got a great deal when he bought the 118-room Mar-a-Lago mansion in 1986 for $10 million (but only $2,812 of his own money, according to a June 22, 1989 article in the Miami Herald), implying it was worth much more. But when Palm Beach County assessed the property at $11.5 million, Trump appealed, seeking an $81,000 reduction in his taxes. A judge ruled against him (UPI, September 28, 1989). Trump later challenged an increased assessment and got a $118,000 reduction for one year but not for the next (Palm Beach Post, December 9, 1992).

In 1990 Trump won an assessment fight with New York City concerning his then-undeveloped waterfront property on the Upper West Side. He gained a $1.2 million savings in his 1989 taxes (Newsday, July 6, 1990).

More recently, Trump has been seeking a 90 percent reduction in property taxes on his Trump National Golf Club in Westchester County, New York. Trump listed the club as having a value of more than $50 million in the financial disclosure document he released as part of his presidential bid, yet his assessment appeal claims it is worth only $1.4 million.

It’s not hard to guess which figure is used when Trump wants to justify his claim of being worth $10 billion.

Donald Trump Corporate Raider

“We’re not interested in being taken over by Donald Trump.” That message, which sounds like a pronouncement by today’s Republican Party establishment, was expressed three decades ago by the board of directors of Bally Manufacturing as it sought to thwart an unwanted bid by the developer. Bally managed to escape the clutches of Trump but it had to pay a significant price.

During his recent endorsement statement, Dr. Ben Carson declared that there are two Donald Trumps running for president, one of them “cerebral.” Whether that’s true or not, there’s evidence of two Donald Trumps in the business world.

The first Trump is the one constantly promoted by the candidate — the owner and operator (or at least licensor) of a string of supposedly wildly successful business all adorned with his name. Whether Trump University or Trump Steaks, these are also the focus of his critics.

Yet Trump has another track record that involves not the running of companies but rather that of profiting by launching takeover bids that do not lead to completed transactions. During the 1980s Trump was a junior member of a fraternity of wheeler dealers known as corporate raiders. (One of the more notable members of that group, Carl Icahn, has endorsed Trump’s presidential campaign).

Among Trump’s main forays was the one involving Bally. In November 1986 Trump disclosed that he had acquired a nearly 10 percent stake in the company, then the world’s largest producer of electronic games and an operator of casinos and health clubs. Right from the beginning, analysts thought Trump was simply looking to profit from a stock price increase resulting from the bid. They pointed to an earlier investment in Holiday Corp., which Trump sold for a $30 million profit after the disclosure of his 4.9 percent stake.

Bally took poison-pill evasive action and sued Trump for what it called an “unfair and coercive” takeover attempt that could jeopardize the company’s gaming licenses in Nevada and New Jersey (Businesswire, December 5, 1986 and Chicago Sun-Times, December 6, 1986). Trump countersued for $1 billion. The war of words and court filings ended in February 1987, when Trump agreed to sell his shares back to Bally at a premium and netted a profit of more than $31 million.

Both Trump and Bally denied that the deal constituted “greenmail,” and the company prevailed in a shareholder lawsuit challenging the arrangement, but as Gwenda Blair wrote in her book on Trump, the stock transaction was “extremely close to greenmail.”

The Bally and Holiday Corp. bids were far from unique. Trump frequently bought stakes in companies — sometimes large enough to trigger an SEC reporting requirement, sometimes not — and ended up selling at a profit after short-lived takeover moves. On October 6, 1989 the Associated Press ran a story headlined TRUMP HAS A HISTORY OF TAKEOVER FEINTS that stated: “Like a high-stakes baccarat player at one of his Atlantic City casinos, real estate tycoon Donald Trump has made some profitable bluffs to help bankroll his ambitious and splashy acquisitions.” The piece noted several examples in which he “accumulated shares in the company – sometimes indicating he might be interested in mounting a buyout – and later sold all or some of his shares at a profit after the price rose on the ensuing takeover speculation or when another bidder emerged.”

In 1988 Trump had to pay a $750,000 civil penalty to settle allegations by the Federal Trade Commission and the Justice Department that he failed to comply with pre-merger notification requirements in some of these situations.

Given this track record, one has to ask which Donald Trump is mounting the current challenge to the Republican Party — the one who takes things over and runs them (sometimes well, sometimes not) or the one who engages in takeovers just to make a profit.

Trump’s behavior in the presidential race often leans toward the latter. His incessant bragging about business acumen has become routine, but the press conference in which he displayed an array of Trump-branded products reinforced the impression that he may view his campaign not so much as a political revolution as an open-ended marketing opportunity for his ventures.

One cannot help but wonder how things would be different if the Republican elite had responded to Trump the way Bally did — by buying him off rather than fighting him. It’s not clear what form greenmail would take in a presidential campaign, but Trump is always saying he is open to a good deal.