This long investigation by The New York Times into Trump’s casino business in Atlantic City is a revelation. How can you read this and believe the man is anything other than a charlatan? Excerpts:
His audacious personality and opulent properties brought attention — and countless players — to Atlantic City as it sought to overtake Las Vegas as the country’s gambling capital. But a close examination of regulatory reviews, court records and security filings by The New York Times leaves little doubt that Mr. Trump’s casino business was a protracted failure. Though he now says his casinos were overtaken by the same tidal wave that eventually slammed this seaside city’s gambling industry, in reality he was failing in Atlantic City long before Atlantic City itself was failing.
But even as his companies did poorly, Mr. Trump did well. He put up little of his own money, shifted personal debts to the casinos and collected millions of dollars in salary, bonuses and other payments. The burden of his failures fell on investors and others who had bet on his business acumen.
In three interviews with The Times since late April, Mr. Trump acknowledged in general terms that high debt and lagging revenues had plagued his casinos. He did not recall details about some issues, but did not question The Times’s findings. He repeatedly emphasized that what really mattered about his time in Atlantic City was that he had made a lot of money there.
You got that? He built his “success” on the backs of his investors, whom he bilked. More:
Mr. Trump assembled his casino empire by borrowing money at such high interest rates — after telling regulators he would not — that the businesses had almost no chance to succeed.
His casino companies made four trips to bankruptcy court, each time persuading bondholders to accept less money rather than be wiped out. But the companies repeatedly added more expensive debt and returned to the court for protection from lenders.
After narrowly escaping financial ruin in the early 1990s by delaying payments on his debts, Mr. Trump avoided a second potential crisis by taking his casinos public and shifting the risk to stockholders.
And he never was able to draw in enough gamblers to support all of the borrowing. During a decade when other casinos here thrived, Mr. Trump’s lagged, posting huge losses year after year. Stock and bondholders lost more than $1.5 billion.
All the while, Mr. Trump received copious amounts for himself, with the help of a compliant board. In one instance, The Times found, Mr. Trump pulled more than $1 million from his failing public company, describing the transaction in securities filings in ways that may have been illegal, according to legal experts.
Mr. Trump now says that he left Atlantic City at the perfect time. The record, however, shows that he struggled to hang on to his casinos years after the city had peaked, and failed only because his investors no longer wanted him in a management role.
He ruined a lot of small business owners who never got paid, or got paid pennies on the dollar, when he went bankrupt. And then there were his investors, who were weirdly mesmerized by this guy. More:
In retrospect, David Hanlon, a veteran casino executive who ran Merv Griffin’s Atlantic City operations at the time of the Resorts battle, said, Mr. Trump succeeded in repeatedly convincing investors, bankers and Wall Street that “his name had real value.”
“They were so in love with him that they came back a second, third and fourth time,” Mr. Hanlon said. “They let him strip out assets. It was awful to watch. It was astonishing. I have to give Trump credit for using his celebrity time and time again.”
Read the whole thing. Seriously, read it. This man might become the US president. Why are people so eager to believe him? Well, let’s ask Scott Adams, who predicted ages ago that Trump would win the nomination. Adams said that Trump may be ignorant of science, but he’s got an intuitive understanding of what science says works for politicians. Excerpts:
But here’s the wrinkle with the view that Trump is not a man of science. One of the things science knows for sure – without a smidge of doubt – is that humans are irrational and we can be influenced by many things…except the truth. Truth is useless for persuasion whenever emotions are involved.
You know what field has a lot of emotional content? Politics. All of it. It is all emotional, from top to bottom. In politics, facts are generally irrelevant. Facts do come in handy while performing the boring work of governing. But during an election, facts are just noise.
So when Rand Paul (for example) tried to win the nomination with his calm demeanor and command of the issues, he fizzled on the launchpad. No traction whatsoever. That’s because Rand Paul did not understand the SCIENCE of persuasion.
Yeah, it’s a science. See my Persuasion Reading List and check it out for yourself, especially the books Influence, Impossible to Ignore, and Thinking, Fast and Slow. The science of persuasion is robust and settled. People are irrational and their decisions are based on emotion, influence, and random variables. Reason is mostly an illusion.
Which of the many candidates for president this season is familiar with the SCIENCE of persuasion? Only Trump, until recently. He saved time and money by ignoring the stuff that doesn’t matter (facts) while putting all of his energy into the stuff that does. And it is working.
And that bothers a lot of people because we think we love reason, and we think we love the truth. What we don’t know is that we don’t really love reason (or use it) and most of what they think of as the truth is actually cognitive dissonance and bias. Human brains did not evolve to provide us with truth. Our brains evolved to keep us alive. So if the false movie in your head is different from the false movie in mine – but we both survive and procreate – nature is satisfied. Truth is irrelevant.
The inconvenient truth about Trump is that he’s operating on a persuasion level because it is compatible with science. And science is awesome.
Trump is apparently a better liar than Bill Clinton, if you can imagine it.