With roughly one week to go before the polls close on Election Day, the New York Times has dropped – what else? – another”bombshell” under the now-infamous heading “The President’s Taxes”.
The MSM is of course still relitigating the claims from this fall’s first big tax bombshell, a 10,000-word piece from the NYT, and others that have been published since.
But in the paper’s latest foray into Trump’s financial history, they visit an episode that has been publicly disclosed before, though the paper adds more details about an “aggressive tax maneuver” undertaken by Trump and his team, as well as offering unprecedented insight into Trump’s extraordinary ability to strongarm lenders, even when eye-popping sums are involved.
The setting for today’s story is the depths of the financial crisis. The location: Chicago, where Trump visited in September 2008, the nadir of the crisis, to celebrate the completion of his 92-floor skyscraper.
After offering the usual boilerplate juxtaposing Trump’s public comments at the opening of the building with the struggles to sell condos in the tower, the NYT noted the following:
Yet for Mr. Trump and his company, the Chicago experience also turned out to be something else: the latest example of his ability to strong-arm major financial institutions and exploit the tax code to cushion the blow of his repeated business failures.
But most importantly, the story lands with a twist: it’s this series of financial victories of Trump over his lenders that is, amazingly, at the core of one of the many investigations currently underway involving Trump and his administration (most of which the public has long stopped caring about). Because New York AG Letitia James’ whole battle over Trump’s tax returns has been centered on whether Trump ‘cheated’ by not paying any taxes on the debts forgiven by Deutsche Bank tied to the Chicago Tower project, and others.
The story of Trump’s business relationship with DB and how he eventually came to take out the loans for the Chicago Tower project is recounted in exhaustive detail. But here’s the interesting part: when Trump applied for his second extension, DB said ‘no’, giving him only six weeks before the bank moved to seize the building.
So what did Trump do? He “went on the offensive,” as the NYT put it. He wrote a letter claiming that the financial crisis was a “force majeure” – an act of God – that entitled him to extra time to repay.
Trump sued, DB and Fortress (which was also brought in on the loan) counter sued, what happened next, like the details above (the broad strokes, at least), were already known.
What wasn’t was the figure that Trump eventually walked away from: Trump was allowed to default on just over $270 million in debt, a deal that, according to the NYT, “few American companies or individuals could ever expect to receive, especially without filing for bankruptcy protection.”
Here’s the key bit:
The forgiven debts showed up in Mr. Trump’s tax returns. For 2010, Mr. Trump’s 401 Mezz Venture reported about $181 million in canceled debts. Two years later, DJT Holdings, an umbrella company that the Chicago project had been folded into, reported that another $105 million of debt had been forgiven. Most of that appears to reflect the unpaid Fortress sum.
A few years later, when the rest of the loan came due, one arm of Deutsche Bank gave the Trump family the money needed to pay another part of the bank.
Now, years later, this is the type of carefully reported, smoothly written story that will sway swing voters to back Joe Biden over President Trump.
If anything, for fans of the president, the account of what he accomplished here will only further burnish his reputation as a ruthless businessman – something that helped propel him to the White House.