Deadbeat Donald Is Swimming In More Debt Than Anyone Suspected

Image by DonkeyHotey via Flickr under CC BY-SA 2.0 license
Image by DonkeyHotey via Flickr under CC BY-SA 2.0 license

Donald Trump is running on his record as a businessman–a record that, by any standard, is an utter disgrace. Bankruptcies, not bothering to pay people who work for him, etc. But Sunday’s edition of The New York Times reveals (above the fold) just how much of a disgrace the Donald’s business record is. It turns out that his fearsome image masks a man who is sinking in debt–and in many cases, we don’t know who his debtors are.

When Trump filed his financial disclosure statement earlier this year, he listed $315 million in liabilities. However, The Times wanted to get a better understanding of Trump’s financial picture. After all, the standard Federal Election Commission financial disclosure form is not designed for a candidate who is worth at least $4.5 billion. Additionally, Trump has never allowed an independent review of his finances, and has refused to release his tax returns.

With the help of RedVision Systems, a property information firm, The Times obtained several reams of information on the 30-plus properties in which Trump has an interest. From these records, The Times was able to get detailed reports of how much debt Trump was actually carrying.

Based on that analysis, The Times concluded that companies controlled by Trump actually have at least $650 million in debt. This is not in any way due to any effort to mislead the public, but mainly because the FEC form asks candidates to list assets and debts in ranges that only go as high as $50 million. Additionally, much of his wealth is tied up in several limited partnership with almost $2 billion in loans.

For instance, Trump owns the lease for the land on which 40 Wall Street–also known as the Trump Building–stands. He pledged the lease as collateral to get a $160 million loan from a small New York lender. However, on the FEC form, he stated that 40 Wall Street only had more than $50 million in debt.

This investigation is the strongest proof yet that Trump was bluffing when he threatened to bolt the GOP and make a third party run if he didn’t get the nomination. We already knew that he was in no financial position to make such a bid. After all, he has already declared bankruptcy five times in 25 years, making it highly unlikely the banks would allow him to borrow against his real estate interests to get the money he would have needed for a third-party bid. But if you think the banks would be willing to lend to a guy who is already carrying $650 million in debt, there’s a bridge in Brooklyn I’d like to sell you.

Richard Painter, a law professor at Minnesota and the chief White House ethics lawyer from 2005 to 2007, thinks that Trump’s massive debt could make Trump vulnerable to the demands of bankers, as well as business interests in the United States and overseas. That should be very worrying for a presidential candidate, let alone a president.

The Times found something that is at least as troubling as Trump’s debt load–in many cases, it couldn’t pierce the corporate veil that hides many of Trump’s business partners. For example, Trump pays $1.6 billion to two limited liability companies for his lease on 40 Wall Street’s land. However, it’s hard to pinpoint who controls the LLC that is majority owner of the parcel, 40 Wall Street Holdings. It acquired controlling interest in the parcel from the family of German shipping magnate Walter Hinneberg.

The Times was unable to find out who owns 40 Wall Street Holdings, and the Trump Organization didn’t provide any details. Many of Trump’s other land leases are in similar situations–that is, the landlords’ identities are hidden behind LLCs with opaque structures. Painter says this should be very concerning, since “we simply don’t know a lot about his financial dealings.”

So yet again, we are faced with a critical question–can Donald Trump be trusted with our money? The Times proves that the answer, once again, is a resounding no.

Darrell is a 30-something graduate of the University of North Carolina who considers himself a journalist of the old school. An attempt to turn him into a member of the religious right in college only succeeded in turning him into the religious right's worst nightmare--a charismatic Christian who is an unapologetic liberal. His desire to stand up for those who have been scared into silence only increased when he survived an abusive three-year marriage. You may know him on Daily Kos as Christian Dem in NC. Follow him on Twitter @DarrellLucus or connect with him on Facebook. Click here to buy Darrell a Mello Yello.