Donald Trump's Mad Scramble for Cash
The Former Guy needs to come up with almost half a billion dollars today, or the State of New York can start taking his toys. And that is what should happen.
Update: less than an hour after I posted, Judge Engoron cut the baby in half (metaphorically, of course), lowering the bond to $175 million. This is more than chump change and less than ruinous. But this is only pending appeal: Trump should start saving his boxtops now.
There is a comedian on Instagram named Maggie Reed who does impersonations of MAGA women: Melania Trump, Lauren Boebert, Kari Lake and Marjorie Taylor Greene are a few. One of her funniest is a mashup of Rudy Giuliani and an advertising jingle from J.G. Wentworth, the lovely people who purchase civil court settlements from the poor at a deep discount. Posted right after a civil court awarded millions in damages to two women harmed in the Georgia election subversion case, an alarmed Giuliani cartoon sings operatically: “I have a structured settlement—but I need cash now!”
I haven’t been able to get that jingle out of my head since last Friday, when Donald Trump’s legal team told the appellate court that their client could not pay the $464 million Judge Arthur Engoron fined him in New York v. Donald J. Trump et. al. It was almost twice what New York’s Attorney General, Letitia James, had asked for, and— added to the $83 million and costs in the E. Jean Carroll case—puts Trump over a half a billion dollars in the hole. Trump does not have the cash, his lawyers initially claimed; and no one is willing to make bond for that kind of money. The Trumps have approached “about 30 surety companies through 4 separate brokers” and all of them said: no dice. None of this is surprising, of course: Trump is well known for not paying his bills.
Nevertheless, those funds must put into escrow by today (when Trump also has to be in court in the Stormy Daniels hush money case), or Letitia James, the Attorney General of New York, can legally begin to seize Trump-owned assets in an equivalent amount. Myself? If I were James, I would start by taking Trump Force One. First, according to Business Insider it’s worth $100 million. Second? He can’t afford it anyway. Third? He would have to find some less dramatic way to get to those stupid rallies.
Also? Rental planes might have germs. He hates germs.
Now, let’s get serious. There are several things going on here that are worth having in your head as the news about Trump’s legal and financial situation unroll today. There is the longstanding mystery of what Trump is actually worth, whether that means he should be able to just write a check for the amount, and if so, why he won’t. Then, there is an international relations question: if Trump cannot get the money any other way, will a foreign entity who wants to invest in autocracy step in, creating an obvious national security threat? Finally, there is a domestic political question. Should James enforce the court’s ruling by seizing Trump’s property, and will that create what might be charitably thought of as a sympathy vote for Trump at a time when the presidential race with Biden is essentially tied?
Let’s start with the most immediate problem, because it involves the legal questions at the heart of Letitia James’s case. It is difficult to know how liquid Donald Trump and his various businesses are. Why? Because he lies about everything, he hates using his own money for anything, and when it comes to his net worth, Trump’s lies are very big.
This dovetails with the substance of the case, which is that The Trump Organization has a long history of altering the value of properties, sometimes in radical and farcical ways, to benefit its bottom line. This practice cheated banks and, James argues, the public. For example, according to evidence introduced at trial, in 1994, Trump signed a document attesting that his triplex in Trump Tower was slightly less than 11,000 square feet. This is true, and it is what he was taxed on. But subsequently, in paperwork that the Trump Organization submitted that included the apartment as collateral for loans and other deals, as well as on his financial statement for the 2016 presidential campaign, the apartment was listed as 30,000 square feet.
The financial implications of this are obvious. Chase Peterson-Withorn of Forbes magazine, who was called as a witness in the New York case, exposed this discrepancy in 2017. He estimated that the apartment was worth $64 million, less than a third of what Trump claimed.
So, here’s the nature of the criming, friends. When a person inflates their net worth to get a loan, they can borrow without having the assets to cover the loan (which is dangerous, and a version of why the stock market crashed in 1929 and the commercial real estate market cratered in 2008.) But Trump, and the Trump Organization, also got more favorable loan rates because these fictional assets lowered the risk, at least on paper. One expert testified that the savings amounted to as much as $168 million. As a relevant aside: should James decide to seize Trump’s New York home (which would instantly make her a candidate for higher office in New York City), is it worth less than $100 million or closer to $200 million?
Enquiring minds want to know. I also suspect there is also a little perjury problem lurking in the background too, since Trump repeated some of his lies under oath: he claimed, according to AP reporter Michael Sisak, that “Mar-a-Lago is worth $1.5 billion and a golf course he owns near Miami is worth $2 billion or $2.5 billion.” Over time, Trump has claimed to be worth as much a $9 billion (that was in 2015, when Forbes said he was worth $4 billion.) In September, 2023, the magazine pegged that number much lower—$2.6 billion—with $640 million cash on hand.
That’s enough to pay the bond, right? Perhaps, but not really, because you can’t suck away almost 4/5 of a global company’s cash without inviting a corporate death spiral. To prevent this something, in the end, would have to be sold. And since Trump had to deposit over $80 million into an escrow account pending an appeal in the E. Jean Carroll case ,there is actually less cash available—either to use or borrow against—than Forbes’s estimated number.
Yesterday, Trump announced on Truth Social that he had $500 million cash on hand, but he just doesn’t want to give it to the State of New York (undoubtedly true) because he needs it for his presidential campaign. This second assertion is an obvious lie, both because of what I noted above and because he will bleed the RNC for cash, probably to the detriment of down ballot candidates.
As Michael Sisak of the Associated Press pointed out, “Trump has never before suggested that he would contribute to his own 2024 campaign and has been soliciting contributions from outside donors since before he left the White House. When he ran in 2016,” Sisak continued,
Trump repeatedly claimed that he was self-funding his campaign, even though he relied on donor funds.
“I don’t need anybody’s money,” he said in his announcement speech in 2015. “I’m using my own money. I’m not using the lobbyists, I’m not using donors. I don’t care. I’m really rich.”
In fact, the joint agreement between the Trump campaign and the Republican National Committee signed last week basically strip-mines RNC donations—not just for the election, but for Trump’s legal, and probably personal and business, expenses. According to the Associated Press, a “new joint fundraising agreement with the Republican National Committee is directing donations to his campaign and a political action committee that has been paying Trump's legal bills before the RNC receives a cut.” In addition, the RNC will probably be billed for all events on Trump property (and all events will be held on Trump property, whenever possible), much as the federal government was during his presidency. This siphons an even larger percentage of political donations into Trump coffers.
All of this brings us back to something we know about Trump, which is that the lies we know about are the tip of the iceberg of a thoroughly unscrupulous person who will say or do anything he needs to say or do to get his way.
Hence the concern about foreign interests stepping in to bail Trump out on the escrow payment due today. Here, we get to the foreign policy question that makes a range of pundits nervous. The Trump family, and by extension Jared Kushner, already has extensive ties with the royal family in Saudi Arabia, the main swag they walked away from the White House with. Six months into 2021, Crown Prince Mohammed bin Salman propped up Jared Kushner’s Affinity Fund with $2 billion from that nation’s main sovereign wealth fund, even though his board expressed strong doubts about Kushner’s intelligence and abilities. According to David Kirkpatrick and Kate Kelly of the New York Times, fund managers’ “objections included:
“the inexperience of the Affinity Fund management”; the possibility that the kingdom would be responsible for “the bulk of the investment and risk”; due diligence on the fledgling firm’s operations that found them “unsatisfactory in all aspects”; a proposed asset management fee that “seems excessive”; and “public relations risks” from Mr. Kushner’s prior role as a senior adviser to his father-in-law, former President Donald J. Trump, according to minutes of the panel’s meeting last June 30.
MBS, as he is affectionately known by those whose friends and relatives he has not had chopped up, overruled them. Not surprisingly, as Kilpatrick and Kelly note: “Ethics experts say that such a deal creates the appearance of potential payback for Mr. Kushner’s actions in the White House — or of a bid for future favor if Mr. Trump seeks and wins another presidential term in 2024.”
There is another $700 billion in the Sovereign Wealth Fund, with $70 billion a year earmarked for investment. So yes, MBS could pay the bill in New York, particularly since there are two pre-existing and legal partnerships with Trump that would allow him to transfer cash: the Affinity Fund and the LIV golf tour. Trump noted in his deposition for this case that LIV might purchase his Turnberry golf club in Scotland.
This kind of offshore financial hanky-panky on the part of a presidential candidate who has already been convicted of malfeasance, and is awaiting trial on even more serious charges, makes any number of foreign policy experts nervous. To say that owing a Saudi Crown Prince $500 million, or $2.5 billion, if you count the Jared and Ivanka Kushner’s principal source of wealth, is a conflict of interest only begins the conversation. As Democratic Representative Sean Casten (IL-06), a member of the House Financial Services Committee, posted on X: “The presumptive @GOP nominee for President is desperate for $464M (and counting) which he cannot personally access. That fact alone makes him a massive national security risk; any foreign adversary seeking to buy a President knows the price.”
Finally, there is the question of should: in an election year, does a Democratic Attorney General stripping Donald Trump of assets, or forcing him into a debt situation, create the appearance of political animus? Will it contribute to political polarization and, more practically, a backlash that could swing voters to Donald Trump in November? In other words, should Letitia James move cautiously in enforcing the court’s decree, avoiding the appearance of using the state to interfere with an election, as Trump and his MAGA cronies have charged?
Yesterday on CNN, pollster Frank Luntz said yes. "You're going to create the greatest victimhood of 2024, and you're going to elect Donald Trump," as Newsweek reported Luntz’s remarks. "If they take his stuff, he's going to say that this is proof that the federal government and the establishment and the swamp in Washington and all the politicians across the country and the attorneys generals and all of this, that this is a conspiracy to deny him the presidency. He's going to go up in the polls, just like he went up every single time they indicted him.”
Not surprisingly, David Brooks (who is anti-Trump, but seems to quail every time the Former Guy is in real danger), took a similar position on the PBS NewsHour on Friday. “Yes, I mean, I have a few problems with the seizure,” Brooks caviled:
The Associated Press did a good survey. They looked like at 70 years of cases like this. And in cases where there was no clear victim, they have never seized assets before. And so, if the people who claim a lot of this is a political witch-hunt, I think that Associated Press, I found it kind of alarming that the Trump case is not being treated like the other cases.
This is not only cowardly thinking, it is wrong. There are victims, and because this is a financial case, none of those victims—banks, and by extension the shareholders and customers of those banks—must sue for the state to bring a case and enforce the judgement. As James argued, and Engoron affirmed, the statute under which Trump is being prosecuted “that the statute doesn’t require victims, only a finding of wrongdoing.”
And here’s the news: it would be another case of a wealthy, powerful person getting away with a crime for which an ordinary American would never be excused. The state frequently seizes the assets of ordinary people in cases of financial wrongdoing: anyone who has failed to pay student loans, taxes, car loans, or mortgage payments can attest to that.
In other words, if the State of New York does not begin to seize assets in the face of nonpayment, should that be the outcome today, that sends a clear message: Trump is beyond the reach of the law. And it would represent another erosion of accountability in our democracy.
What I’m doing when you aren’t looking:
I just finished Lucy Sante’s memoir of gender dysphoria and transition at 67, I Heard Her Call My Name (Penguin Press, 2024). A lifetime of struggle over gender is woven into a stunning narrative of other metamorphoses: immigration, education, and a life on the Lower East Side. Highly recommend.
On a long plane trip, I watched The Magnificent Seven (John Sturges, 1960) for the first time since viewing it as part of a Western film class as college. A remake of The Seven Samurai (Akira Kurosawa, 1954), it features a stunningly beautiful Yul Brunner and Steve McQueen as leaders of a band of American gunslingers who are hired to defend a Mexican village. Two things I noticed that I had not understood about this film at the time. One is that Lee, the traumatized gunslinger played by Robert Vaughn who hides during gunfights, is also all kinds of gay. The other is that, aside from the racist framing of the Mexican men who are either villagers too passive to defend themselves or savage bandits, a disproportionate number of these actors are white men in brown face. Which is all to say: long after blackface was understood as racist, white actors impersonating ugly stereotypes of Mexican people seems to have remained a Hollywood staple.
Short Takes:
OK, this isn’t American politics, but if you were not interested in some aspect of the furor over the Princess of Wales’s disappearance, you don’t have a pulse. There have been many responses to Kate Middleton’s video announcing her cancer diagnosis, from “Shame on everyone!” to women oversharing on social media the details of their own abdominal cancers. So, a serious response from royal watcher Tina Brown today in today’s New York Times was a real palate cleanser. According to Brown, the real problem here is that keeping Charles and William in the waiting room for over a decade left a palace system frozen in place that is ill-equipped for today’s media and political environment. “It may not be a popular thought, but in many ways I blame the predicament and weakness of the monarchy today on Queen Elizabeth,” Brown writes. “It’s possible that future generations will see her as the Ruth Bader Ginsburg of the British monarchy. She stayed too long, and by doing so, left behind a legacy that may be the opposite of what she wanted.” (March 25, 2024)
Conservative efforts to ban the medical abortion pill mifepristone (RU-486, used in tandem with misoprostol) take the stage tomorrow at the Supreme Court. The conservative Alliance for Hippocratic Medicine (AHM) will argue for upholding a lower court order to reverse FDA rules that made the pill more widely available by reducing the number of doctor’s visits and making abortion available by telemedicine. “The mifepristone case emerged from the Fifth Circuit, which, as Vox put it, has become the nation’s `Trumpiest court,’” The New Yorker’s Amy Ross Sorkin writes. But it is a case that demonstrates how much anti-abortion warriors and their judicial allies have altered our justice system. “To bring a suit, parties are supposed to show `standing’—meaning that they have been harmed in some direct way that a court can remedy,” Sorkin explains. “The AHM’s contention is that some of its members are doctors who theoretically might encounter patients in an emergency room who needed care after taking mifepristone and be forced to treat them in some manner that could violate those doctors’ consciences. It’s not clear that this has ever happened. The AHM also argues that treating these patients would divert “time and resources” from those its members do approve of.” (March 22, 2024)
A new study by the Brennan Center for Justice confirms that in the aftermath of the Supreme Court’s decision in Shelby v. Holder (2013), the racial voting gap has widened. This is true across the nation, but the gap is twice as great “in jurisdictions previously covered by the preclearance requirement,” Carrie Levine writes at Votebeat, a nonpartisan site that reports on the nuts and bolts of democracy. Stay policies have made it harder for people of color to vote, but so have changes at the local level about how voting occurs: “local administrators have a lot of control over how elections work,” Levine writes, noting that before Shelby, federal officials curbed discriminatory policies. “They must decide how to implement state laws, where to put polling places, and how to allocate limited resources. But those individual changes are hard to track, and their direct impact is difficult to assess. The study’s approach captures a result of all of those changes.” (March 18, 2024)
I think the bloom of off the rose regarding Trump's wealth and integrity. Taking his assets will make that clear to all but the most bone headed.
He'll walk up to the judge, open his briefcase, and start handing up bundles of $500 bills.
The only problem will be: they'll be small, orange, have little choo-choos printed on them, and say "Monopoly."