One of Republicans' biggest promises about their tax law is coming apart at the seams
"Trump and the Aristocracy of Fraud"
Bob Bryan Oct 17, 2018, 5:24 AM
Chip Somodevilla/Getty Images
* The Treasury Department reported that the budget deficit grew to $US779 billion in fiscal 2018.
* A primary reason for the increase in the deficit was a decrease in revenue due to the GOP tax law.
* The evidence so far contradicts Republicans leaders and the Trump administration’s argument that the tax law would pay for itself.
* While there may still be a revenue boost from the law, the early returns do not look encouraging, and most forecasters expect the deficit to grow.
Republicans said their tax law was supposed to pay for itself. But according to new data from the Treasury Department, their overhaul of the tax code isn’t producing the desired result.
Fred Trump was a fiercely ambitious man who worked seven days a week and devoted few waking hours to his role as a parent. Although he pushed his son Donald to prevail in every arena—to be a "killer" and a "king"—Fred didn’t actually tell the young man how to achieve this destiny. His way of paying attention to his children was to let them watch him at work. As Donald Trump told me in an interview for the biography I was writing about him, he was expected to learn things “by osmosis.” One such lesson came when Donald was seven years old, and his father was brought before a U.S. Senate committee investigating abuses in a housing program for war veterans and middle class families. President Eisenhower had been outraged to learn of the bribes that developers paid to bureaucrats and of the alleged profiteering practiced by Trump and others. Ike called them “sons of bitches.”
As federal investigators had discovered, the elder Trump had collected an extra $1.7 million in rent—equivalent to $15 million today—before beginning to pay back his low-cost government loan. He was able to do this because a bureaucrat named Clyde Powell approved the paperwork. Powell, who had never been paid more than a modest government salary, had mysteriously amassed a small fortune. (While it was clear Powell accepted bribes, the sources were never officially identified.) In addition to collecting the extra rent, Trump paid himself a substantial architect’s fee. And he charged inflated rents based on an estimate of construction costs that was far greater than what he actually spent. All of this was legal, even if it did victimize taxpayers, veterans, and other renters.
Like his father, Donald J. Trump seems to be a patriotic American, but like his father he's also someone who never misses a chance to bend the rules. (Fred was not inhibited by patriotism when it came to exploiting federal housing programs, even those devoted to veterans. To him the profit motive was supreme.) By the accounts of his children and friends, Donald appears to be a good and devoted father, perhaps a somewhat more attentive one than his own dad—as well as grandfather to eight children, the latest of which was added to the Trump dynasty this week by his daughter Ivanka, who gave birth to her third child. But Trump’s basic philosophy of living, instilled by his fiercely ambitious, workaholic father, enforced by the tough-as-nails coach at his military high school and honed over a lifetime of ruthless deal-making, is fairly simple and severe: Life is mainly combat; the law of the jungle rules; pretty much all that matters is winning or losing and rules are made to be broken. It is largely a materialistic worldview; even the brand of Christianity Trump was raised in was fairly materialistic, the product of pastor Norman Vincent Peale, who wrote: “Learn to pray big prayers. God will rate you according to the size of your prayers."
Thus, for those of us who have followed Trump’s career from the start, the worldview he has trotted out to the public is no surprise. Some people seem shocked that he embraces torture without compunction; openly admires the suppression of freedom by Chinese and Russian dictators; and shows little grasp of ethics, governance or constitutionalism, as evidenced by his insistence that the U.S. openly engage in war crimes (by killing the families of terrorists). Or that he often seems ignorant of history and the economic benefits of free trade, dismissing the U.S. alliance and trading system that won the Cold War as “obsolete,” calling regularly for punitive tariffs and insisting over and over again, “We never win anymore,” as if trade were a zero-sum game (which it is not). Or that he relishes the idea that people at his rallies punch each other, suggesting that his supporters “knock the crap out of” any disrupters.
But, as Trump's biographer, I can tell you these views fundamentally define the man. And if you’re looking—or perhaps hoping—for something more, you shouldn’t expect to find it. If you are seeking reassurance that the man who could be the next president of the United States possesses a coherent political philosophy or ethical foundation other than this rather pre-Enlightenment code of behavior—that he subscribes to the ideals of the Founders, or has studied and understood American democracy, human rights and our Constitutional system—you won’t get it.
Rare if not unique in American politics, Trump’s views and provocations are consistent with his biography. Trump first became a public figure in the 1970s when, in response to charges of housing discrimination, his lawyer compared federal officials to the Gestapo. From this point on, Trump consistently showed he was willing to use threats, insults and deception not unlike the kinds of things he says about his political rivals today—if it meant getting what he wanted. His view of life resembled the Hobbesian nightmare of a “war of all against all” with little regard for the social contract that makes for peaceful communities and countries.
And clearly Trump’s message is resonating with voters,which tells us something about many of our fellow Americans, and the cult of success that is part of our national lore. The candidate’s words, streamed out of his consciousness with few connecting ideas, have the effect of little electric shocks that stimulate fear and rage—invite those feelings into the open and legitimize them among his supporters, who appear to be getting bolder in their own responses.
With Trump directing their removal, several protesters have been roughed up by his supporters. Earlier this month, a Trump loyalist sucker-punched one at a rally in North Carolina. (The assailant now faces criminal charges.) Days later, reporter Michelle Fields filed a complaint with police alleging she had been manhandled and bruised by Trump campaign manager Corey Lewandowski (who was charged with misdemeanor assault on Tuesday and claims he is innocent). Then came the uproar in Chicago, where Trump had chosen to speak at a university an inner-city location where a confrontation with students was inevitable.
Indeed, although it is now manifesting itself in new ways, the Trump we see today is nothing new. For decades he has conducted a public psychodrama on a massive scale, revealing himself to be egotistical, ill-mannered and grasping. His reality TV show and all the products, aircraft and buildings adorned with his name are devices designed to capture attention. However, for Trump there is never enough attention, or for that matter money and power, to satisfy the need that has driven him for his entire life.
What is the source of the need that motivates Trump? In his life story, the most plausible explanation is his stern, demanding, and ultimately rejecting father. As Donald Trump told me, his father Fred was “very tough” and “very difficult” and someone who “would never let anything go.” He was also the man who all but banished his son when he was barely twelve years old.
Fred Trump was a real estate developer who established a web of political connections with cash. (Though he was a Republican, the donations were about currying favor, not advancing ideals, so they went to the Democrats who controlled things in New York City.) Father Trump used his relationships with politicians to access government programs, which offered subsidized financing to developers of apartment buildings. Clever lawyers helped him create a variety of corporations so he could violate the spirit, if not the letter of the regulations that governed these programs and wring maximum profit out of the taxpayers.
For the most part Fred practiced his manipulations out of public view. But when his turn before the U.S. Senate committee investigating housing abuses came, Fred Trump admitted his manipulation of the program even as he said he saw nothing wrong in it (prefiguring some of the things his son would later say about his own practices, like political donations). Any suggestion that he had cheated was “very wrong, and it hurts me,” said an indignant Trump, who also complained of the “untold damage to my standing and reputation” caused by the committee. Trump was almost alone in taking such a publicly self-justifying position. In their turns before the committee other builders had refused to answer questions because they didn’t want to incriminate themselves. One of the men had a heart attack three hours after his testimony.
Fred Trump’s reputation was further damaged in 1961 when he joined a group of government contractors who gave money to mayoral candidate Robert Wagner. The $25,000 fund, to which Fred had contributed $2,500, was discovered by the press and became a scandal for Wagner, who gave the money back. Five years later, state officials called Trump to testify about abuses in another housing subsidy program. In this case Trump had inflated his take from the program with tricks like renting his own equipment, such as earth movers and tile cutting machines, to himself and then charging the state many times its value. These clever strategies were so complex and involved so many corporate entities, that he struggled to recall exactly what he had done. “I’ve got forty-three corporations I’m sole stockholder in,” he explained to an investigating committee. “These things escape my mind sometimes.”
In addition to the deceptions Fred Trump employed to profit at the taxpayers’ expense, Trump senior used a fake persona—“Mr. Green”—to conduct business when he didn’t want to use his own name to inquire about a piece of property he wanted to buy. Within the family this ruse was quite amusing, and they joked about how Mr. Green might die were he ever sought by the authorities. In a similar sleight of identity, Fred found it profitable to deny his German heritage. After World War II, he began to say that he was of Swedish descent. Swedes may have lurked somewhere in the family’s past, but both of his parents were German born and bred.
While Fred Trump was busy scheming and manipulating, his son developed into a bullying and out-of-control little boy. As Donald recalled to me, he loved to fight—“all kinds of fights, even physical”—and the teachers and administrators at the private school he attended in Queens, New York, couldn’t manage him. The situation was quite embarrassing to Donald’s father, who was a major benefactor for the school. In exasperation, he abruptly removed his son from the family home, which was a mansion attended by servants, and handed him over to the New York Military Academy in Upstate New York. Upon arrival, twelve-year-old Donald was put into uniform and assigned a tiny cell-like room. In the days, weeks and years to come he would have to cope with an all-male culture of competition and hierarchy where physical abuse, carried out by the students and the adults who supervised them, was part of the routine.
At NYMA, where older boys tormented younger ones in the name of “discipline,” Trump was thrown into an aggressive and isolate subculture that prized physical toughness and defined manhood in the basest terms. One former cadet, who knew Trump at the academy, recalled for me a place that was supposed to civilize boys who were bullies and toughen up those who appeared to be weak. According to Sandy McIntosh, physical abuse was common, as were disappearances, as kids who couldn’t adjust ran away. McIntosh sees, in the NYMA way of life, a sensibility that would lead someone to accept torture as an effective interrogation tool.
In his years as a NYMA cadet, Trump found a new role model and substitute father in a combat veteran of World War II named Theodore Dobias. Sergeant Dobias had fought in some of the bloodiest battles in Italy and seen Mussolini’s body swinging from a rope. He was, in Trump’s telling, a rough and occasionally demanding man. “In those days they’d smack the hell out of you. It was not like today where you smack somebody and you go to jail,” he said. “He [Dobias] could be a fucking prick. He absolutely would rough you up. You had to learn to survive.” Trump recalled that when he responded to an order from Dobias with a look that said, “‘Give me a fucking break,’ he came after me like you wouldn’t believe.”
Like many children who are abused by their caretakers, Trump came to identify with the drill sergeant Dobias. He was especially drawn to the sergeant’s way of coaching the baseball team. (Trump was a star player.) With a nod to football legend Vince Lombardi, Dobias told his boys that “winning isn’t everything, it’s the only thing.” He put the Lombardi motto on the wall of the locker room.
As Dobias and schoolmates would tell me, Trump thrived in the NYMA environment where every boy competed for a spot in the pecking order and the strong dominated the weak. The survival-of-the-fittest ethic that infused the school could sometimes cause trouble: In Trump’s senior year, the school’s top three officials had to resign after a senior boy whipped a younger one with a chain and the victim wound up in the hospital. In that same year, Donald became the leader of the school’s marching unit and led them in a parade down Fifth Avenue. One boy gets whipped. Another gets to lead a parade. It was all part of the NYMA way.
***
Trump told me he was also influenced in his youth by the sermons of the Norman Vincent Peale, pastor of the marble Collegiate Church in Manhattan. An anti-Catholic, Peale had publicly opposed John F. Kennedy’s presidential bid, saying, “Faced with the election of a Catholic, our culture is at stake.” The statement caused such a furor that Peale would retreat from politics. However he remained an extremely influential cultural figure and corporate America’s favorite preacher. More than 750 firms purchased subscriptions to his Guideposts magazine for their employees. His services attracted bankers, executives and business operators like Fred Trump.
Peale’s brand of Christianity was more materialistic than spiritual and it revolved around the concepts in his book, The Power of Positive Thinking, which encouraged the use of self-hypnosis techniques in the pursuit of success. He taught people to “actualize” their dreams of “prosperity, achievement, success.” Reinhold Niebuhr, the greatest American theologian of the 20th Century, regarded Peale’s various organizations as a cult "trying to make a success story out of Christianity." As a pastor who believed that God’s creation was so awful and frightening and prescribed mantras of self-affirmation as comfort, Peale defined what would become Donald Trump’s egocentric view of life. An adult Trump would say that "man is the most vicious of all animals, and life is a series of battles ending in victory or defeat.” In this context, which posed the individual against the world, strength would be the ultimate moral value; extremism in the pursuit of self-interest would be not a vice, but a virtue. Focused on his personal goals, and not the greater society, Donald stayed on the sidelines during the social and political turmoil of the 1960s. He used his college years to develop skills in finance and apprentice at his father’s business. A minor physical infirmity—he called the affliction “heel spurs”—allowed him to sidestep the Vietnam War and move into the family business as he finished school. Soon he had another mentor in the notorious lawyer Roy Cohn. Profane and bigoted, Cohn was a gay Jewish man who had been Senator Joe McCarthy’s chief aide during his witch hunt hearings and who spouted anti-Semitic and homophobic slurs.
Cohn presented himself as the very image of the semi-dangerous New York City hustler who was so slick he could get away with breaking the rules. He dressed and talked like the mobsters who were his clients, swanned around town in a Rolls Royce and cultivated gossip columnists to promote his business. When the two men became friends, Cohn brought Trump around to swanky clubs and introduced him to big shots like Yankees boss George Steinbrenner. As Trump’s lawyer he responded to federal charges of housing discrimination with a $100 million counter-suit alleging the feds had acted like “storm troopers” who had used “Gestapo-like tactics.” The counter-suit failed, but it won Trump’s loyalty. He would keep a picture of a glowering Cohn at hand and show it to visitors so they would know that his attorney was a the lawyerly equivalent of a rabid dog.
Young Trump adopted many of Cohn’s ways. He wore fancy suits and shoes dyed to match. He prowled Manhattan in a chauffeured limousine with vanity plates—DJT—and he promoted himself to the press. Whenever he came into conflict with others he followed a maxim which calls for striking back, and any slight real or perceived, “ten times harder.” He often chose not to offer the kind of courtesies, like mutual respect, that generally govern polite society. “For the most part, you can’t respect people,” Trump would tell me, “because most people aren’t worthy of respect.”
Trump’s crude assumptions about human nature, and his own sense of superiority, meant he felt comfortable seeking to impose his will other others. A case in point involved his role as owner of the New Jersey generals of the now-defunct United States Football League. Fellow USFL owner John Bassett was so appalled by Trump’s behavior that he wrote him, in all capital letters, to complain of “YOUR PERSONAL ABUSE OF THE COMMISSIONER AND VARIOUS OF YOUR PARTNERS.” Bassett noted that he was older and smaller than Trump but would nevertheless punch him “RIGHT IN THE MOUTH THE NEXT TIME AN INSTANCE OCCURS WHERE YOU PERSONALLY SCORN ME OR ANYONE ELSE WHO DOES NOT HAPPEN TO SALUTE AND DANCE TO YOUR TUNE.”
As opportunistic as his father, Trump made political donations without concern for a candidate’s views because he only wanted to gain access to the powerful. When asked his about his own philosophy, he adopted policy positions he found useful at the time. He would be in favor of abortion rights and then opposed to them, supportive of extra taxes on the rich and then against them. When he needed tactical advice he would turn to a Roy Cohn acolyte, Roger Stone, who subscribed to the flame-thrower style of advocacy. Having served Richard Nixon as a dirty trickster, Stone’s methods, as Jeffrey Toobin reported in the New Yorker, call on partisans to “Attack, attack—never defend” and “Admit nothing, deny everything, launch counterattack.”
Stone and Trump have been close for decades. In 2000, Stone was one of several Trump associates fined by New York state for failing to disclose that they had secretly financed advertisements against the development of casinos in the Catskill Mountains region. In 2008 he formed an anti-Hillary Clinton organization he called Citizens United Not Timid. The main purpose of this organization, which attracted a lot of attention for its acronym, was never quite clear. More recently Stone advised Trump on his current presidential run. After formally departing the campaign he became a loyalist commentator on political TV. He speaks of Trump in the glowing way of a proud mentor.
***
If you study the roster of key “influencers” in Donald Trump’s life—Fred Trump, Roger Stone, Roy Cohn, Norman Vincent Peale and Theodore Dobias—you understand that Trump isn’t just saying the things he says for effect; he believes in them with a passion. These mentors demonstrated to him the efficacy of intense self-interest and the many ways he might seek to profit and dominate others by violating the usual norms.
Trump’s wily father managed to amass an enormous fortune, by using political connections to access government housing programs, but he wasn’t satisfied with the usual profit that would come with ordinary effort. Instead he used whatever means he could to skirt the true, civic purpose of the programs and maximize his take. As a father he was demanding, but aloof, and consumed with work.
Truly his father’s son, Donald was a man driven to amass a great fortune and willing to bend the rules to get what he wanted. As a creature of the media age, he considered fame a business tool and became obsessed with his image in the press. This interest reached a nadir when his affair with a young model named Marla Maples became public and his first marriage imploded. With the sordid mess exposed in lurid headlines, Trump himself fed the tabloid press, much to the dismay of his wife and children who suffered pain and humiliation.
What gave Trump the fortitude to press on? Here the inspiration must have included the military academy and Sergeant Dobias, who valued toughness above all else. In Trump’s own telling, Dobias and other officers used force to bring cadets into line and demonstrated that bullying works. The boys, in turn, subjected each other to maltreatment that left both physical and psychological scars. As one of the dominant cadets during his years at NYMA, Trump showed he had learned the lessons of power, which he would take into the world.
From his pastor, meanwhile, Trump apparently learned that the world was a truly awful and frightening place, justifying Peale’s theology of “me.” As he gazed upon a congregation full of executives and go-getters, Peale did all he could to help them shut out concerns about community or social justice so they could pursue their ambitions. Extreme self-interest was fully justified.
In adulthood, Trump entered a world where insider access, tough-guy methods and a singular devotion to one’s self proved to be effective. Although Roy Cohn was eventually stripped of his law license and died in disgrace, while he lived he enjoyed a lavish lifestyle. He was famous and feared and both of these truths gave him a certain power. The same would be true for Roger Stone. Like the others, he skirted the rules and norms that others observed. He seemed interested only in winning the battle of the moment, and obviously enjoyed making people feel appalled and outraged.
Trump is thus a brilliant student of the street, but not of political philosophy. He is as manipulative and self-serving as his father. He is as authoritarian as his NYMA drill instructors and as self-justifying as Rev. Peale. In his public life he has demonstrated the ruthlessness and cynicism of Roy Cohn and Roger Stone. When New York was roiled by racial fears after the infamous Central Park Jogger assault, Trump fueled the fire with newspaper ads calling for restoration of the death penalty. Exoneration of the accused, after their long terms in prison, brought to expression of regret from Trump. Similarly, when he victimized creditors in four massive corporate bankruptcies, he offered not apologies but the argument that he was a brilliant businessman. All that mattered, in the end, was whether things had worked profitably for him. And they had.
Today, campaigning around the country, Trump talks frankly of transferring his code of life success to the presidency. Last month in Georgia, for example, he told a cheering crowd that he had spent his career being greedy, but “now I’m going to be greedy for the United States and take and take and take.” Thus, if he becomes president and provokes greater unrest, greater danger and greater division, don’t expect Trump to play the peacemaker or the statesman. For him, winning isn’t everything; it is the only thing, and no other rules apply. The question is whether one can “win” as leader of the free world in the same way as one can in the boardroom.
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