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NYT Exposé: “Self-Made Billionaire” Donald Trump Built Empire on Father’s Money, Tax Dodging & Fraud

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President Donald Trump built his personal brand and presidential candidacy on the claim that he was a self-made billionaire whose only head start was a “small loan of a million dollars” from his father. But a New York Times exposé has revealed that Trump inherited much of his family’s wealth through tax dodging and outright fraud, receiving at least $413 million in inflation-adjusted dollars from his father’s real estate empire. We speak with David Barstow, three-time Pulitzer Prize-winning investigative reporter for The New York Times and the lead author on the new investigation, “Trump Engaged in Suspect Tax Schemes as He Reaped Riches from His Father.” Barstow shares a byline with Susanne Craig and Russ Buettner.

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This is a rush transcript. Copy may not be in its final form.

NERMEEN SHAIKH: The New York State Department of Taxation and Finance has opened an investigation of President Trump for fraud and tax evasion, following a major exposé by The New York Times. New York City Mayor Bill de Blasio has also called for a city probe, and Democratic Senator Ron Wyden has urged the IRS to investigate the president.

The Times revealed Trump inherited much of his family’s wealth through tax dodges and outright fraud, receiving at least $413 million—in inflation-adjusted dollars, that is—from his father’s real estate empire. The _Times_’ 13,000-word investigative report found the late Fred and Mary Trump transferred more than $1 billion in wealth to their children, and much of it to Donald Trump, paying less than 5 percent of the $550 million in taxes they should have under inheritance tax rates. As part of a scheme to reduce taxes, Donald Trump also helped his parents undervalue real estate holdings by hundreds of millions of dollars in IRS tax returns.

AMY GOODMAN: The New York Times also reports Trump earned $200,000 a year in today’s dollars from his father’s companies beginning at the age of 3, with a salary that increased to $1 million a year after Trump graduated college and to $5 million a year when Trump was in his forties. Over the years, Trump has repeatedly portrayed himself as a self-made billionaire whose only head start was a “small loan of a million dollars,” he would say, from his father.

DONALD TRUMP: It has not been easy for me. It has not been easy for me. And, you know, I started off in Brooklyn. My father gave me a small loan of a million dollars. I came into Manhattan. And I had to pay him back, and I had to pay him back with interest. … He used to say, “Donald, don’t go into Manhattan. That’s the big leagues. We don’t know anything about that. Don’t do it.” I said, “Dad, I gotta go into Manhattan. I gotta build those big buildings.” … I built what I built myself, and I did it by working long hours and working hard and working smart. More importantly than anything else is by using my own brain. And there was a point where I was making so much so fast, and it was so easy, that I almost got bored. And it’s true. … I got a very, very small loan from my father many years ago. I built that into a massive empire. And I paid my father back that loan.

NERMEEN SHAIKH: On Wednesday, President Trump attacked The New York Times. He tweeted, quote, “The Failing New York Times did something I have never seen done before. They used the concept of 'time value of money' in doing a very old, boring and often told hit piece on me. Added up, this means that 97% of their stories on me are bad. Never recovered from bad election call!” he tweeted.

AMY GOODMAN: The Times article was based on public records as well as tens of thousands of confidential documents, including bank statements, financial audits, accounting ledgers, cash disbursement reports, invoices, canceled checks. The documents include more than 200 tax returns of the late Fred Trump, but do include the president’s personal—they don’t include the president’s personal tax returns, which he has refused to release. White House Press Secretary Sarah Huckabee Sanders responded to the article during Wednesday’s press briefing.

PRESS SECRETARY SARAH HUCKABEE SANDERS: I’m not going to sit and go through every single line of a very boring 14,000-word story. The only thing—I will say one thing the article did get right was that it showed that the president’s father actually had a great deal of confidence in him. In fact, the president brought his father into a lot of deals, and they made a lot of money together, so much so that his father went on to say that everything he touched turned to gold. The president’s lawyer addressed some of the specific claims and walked through how the allegations of fraud and tax evasion are 100 percent false and highly defamatory. There was no fraud or tax evasion by anyone. He went on much further, and I would encourage you to read every word of his statement, which completely undercuts the accusations made by The New York Times.

AMY GOODMAN: We’re joined right now by David Barstow, the three-time Pulitzer Prize-winning investigative reporter for The New York Times, lead author on this new investigation revealing the original source of President Trump’s wealth. David Barstow shares a byline with Susanne Craig and Russ Buettner on The New York Times exclusive, “Trump Engaged in Suspect Tax Schemes as He Reaped Riches from His Father.”

Welcome to Democracy Now! So, you have been attacked by the White House for what you’ve done, the piece they call old and boring. Tell us first—I mean, this is a massive piece, which is being reissued on Sunday, is that right, by The New York Times?


AMY GOODMAN: Many-page piece headlined “Trump Took Part in Suspect Schemes to Evade Tax Bills.” Talk about how you found this information, and what were your key findings, David?

DAVID BARSTOW: Well, first, how we found it was kind of the old-fashioned way. It was going to courthouses, scouring public records, knocking on a lot of doors and, gradually, over many months, piecing together, building this trove of documents, over 100,000 pages, by the time we were ready to publish. And I think, most significantly, in terms of for people to be able to assess this story, it’s important to know that this includes literally tens of thousands of pages of never-before-seen documentation of the actual inner workings of Fred Trump’s real estate empire.

NERMEEN SHAIKH: But those documents—if I could just interrupt briefly—those were confidential records.


NERMEEN SHAIKH: So you couldn’t have gotten those from the public records.

DAVID BARSTOW: Yeah, you only get those by knocking on a lot of doors.

NERMEEN SHAIKH: What doors did you knock on?

DAVID BARSTOW: I’m not going to talk about that, but good try.

AMY GOODMAN: Talk about your major findings, particularly what you say is this illegal transfer of wealth.

DAVID BARSTOW: So, I think there’s two core findings. One is simply that the narrative that Donald Trump has sold to the public for many decades now, the thing that made him famous, that gave him political power and that, ultimately, I think, was the central focus of his presidential campaign, is this narrative that he is a self-made billionaire. And what this story really reveals is the extent to which that just simply doesn’t square with the facts that are uncovered and that we show in this story. So that’s sort of, I think, point number one.

Point number two is, not only did he receive $413 million from his father, not only did he receive another $140 million in today’s dollars in loans from his father, but that that amount, the amount of money, was significantly increased by a series of tax schemes that the tax experts that we consulted with in our reporting, laying this out to them, said these things go way beyond the normal tax avoidance strategies that wealthy, sophisticated people will employ in any event to lower their tax bill. This was a set of maneuvers that were actually intended to deceive the IRS about the value of things that were being given from Fred and Mary Trump to Donald Trump and his siblings.

I think those are the two main points, that there’s a huge amount of money flowing, not just when he was a young man, but actually throughout Donald Trump’s life, especially when he was in financial difficulties, especially when he was taking on new projects, and that that river of money was fed, very much so, by tax evasion, tax dodges.

AMY GOODMAN: Tax evasion and tax dodges, and we’re going to find out just what those were. We’re speaking to three-time Pulitzer Prize-winning journalist David Barstow, who has just been attacked by the White House for this massive exposé in The New York Times about how Donald Trump gained his wealth. Stay with us.


AMY GOODMAN: That’s called “Old Man Trump.” The song was written, but never recorded, by Woody Guthrie. Again, by Ryan Harvey, Ani DiFranco and Tom Morello. Yes, Woody Guthrie never recorded it, but it’s about his landlord, Donald Trump’s father, Fred Trump. In the 1950s, Woody Guthrie lived in a Trump-owned apartment building in Brooklyn. This is Democracy Now!,, The War and Peace Report. I’m Amy Goodman, with Nermeen Shaikh.

NERMEEN SHAIKH: In The New York Times exposé on Trump’s tax practice, the reporters referenced several reporters who did groundbreaking work on Trump’s finances. One of them was the late Wayne Barrett, who wrote the book Trump: The Deals and the Downfall. He appeared on Democracy Now! in June 2016 and said Fred Trump’s financial support of Donald Trump was, quote, “unbelievably crucial in Donald’s rise to prominence.”

WAYNE BARRETT: When he opened his first office in Manhattan, the rent was paid by his father’s company out here on Avenue Z in Brooklyn. And everything that he did, whether it be the Grand Hyatt—the Grand Hyatt, for example, to get the financing, he got the financing from two banks that his father had used, used his father’s relationship banker. And the father had to sign the financing agreements. I mean, they’re not going to give a 30-year-old kid $35 million in 1978 to build a hotel. It has to be done with Fred’s resources. And Fred Trump was a great outer borough builder and really built good housing, 20,000 units totally, all over Queens, all over Brooklyn, some of them towers, like Trump Village, many of them single-family homes, that he had a great reputation as a builder. He was politically wired, as his son was. I mean, they played the political game, both of them, expertly, but Fred Trump was indispensable. I mean, even Trump Tower, which comes along later in Donald’s career, could not have been done without Fred coming in and supporting the financing of it. When he opened his first casino in Atlantic City, when he bought the first properties, the lease holds for the first properties for Trump Plaza, his casino in Atlantic City, Fred rode down in the limo with him and signed all the lease hold documents. Nobody was going to be financing this kid developer, kid casino operator. It was Fred who was the key to all of it.

It’s so ridiculous for him to call himself a self-made guy, when Fred was critical at the political end, too. I mean, everything that came to Donald came through political connections. And they were political connections forged by his father over decades with Brooklyn politicians. He came from the same political club as the then-mayor of New York, Abe Beame. And when they—he had to get an option for the Grand Hyatt and for the West Side Yards from a bankrupt railroad in Philadelphia, Penn Central, and the people who were selling the assets of the bankrupt railroad wanted to make sure that the option that they gave, they were giving it to a developer who would actually develop, because that’s when the real payment comes to the railroad. And so, they came up from Philadelphia, and Fred Trump greets them. And Fred and Donald get them in a limo and take them down to City Hall, and there’s Abe Beame standing on the steps of City Hall. “Anything you want, we’ll give you.” So this totally a byproduct of Fred’s relationships.

AMY GOODMAN: So, that’s the great reporter Wayne Barrett, who dogged President Trump, Donald Trump, long before he was president, for decades, and, of course, wrote a book about him. Juan González and I went to his house to interview him just before he died. David Barstow, you’re a three-time Pulitzer Prize-winning journalist. Wayne, of course, one of your colleagues over the decades. You cite him in your piece. He’s giving us some sense of who Fred Trump was. But go back to the beginning and talk about baby Trump—that’s baby Donald Trump—and how he started to accrue this wealth, something very different than he has told.

DAVID BARSTOW: Yeah. So, how does a 3-year-old end up making $200,000 a year? Right? That’s a good question. Here’s how it worked. Fred Trump—you know, Wayne is absolutely right that he was a really great builder in the outer boroughs, but much of his building was actually made possible through federal housing subsidies. He was actually one of the country’s biggest recipients of cheap building loans basically made possible by the federal government.

And he used $26 million or so of those cheap loans to build two of his biggest apartment complexes in New York: a place called Beach Haven and another place called Shore Haven, both out in Brooklyn. These are massive, massive apartment complexes, thousands and thousands of units. And so, he was building those in the late '40s. And what he did was something quite clever. He put the land underneath the buildings into a trust and made his children the beneficiaries of that trust. And then he had the companies, his companies, that were actually building the buildings on top of the land, sign 99-year leases to pay rent to the landlords—his young children. And so what that meant was that Donald Trump, starting at age 3, was Fred Trump's landlord. He was collecting rent payments from Fred Trump’s companies.

And it was this kind of maneuver—right?—setting up these sort of mechanisms, these financial mechanisms, that would just kind of create this automatic streams of money that would just sort of, month by month by month, would trickle into trust accounts or into partnerships and find their way, ultimately, into the pockets of his children. Fred Trump was just a genius at coming up with new ways, new revenue streams, to funnel into the pockets of his children. So he didn’t just make his children his landlord, he also made his children his banker. He made Donald Trump not just—didn’t just put him on the salary as a vice president of Fred Trump’s companies. He also then paid him separately to be his consultant. He paid him separately to be a property manager. He paid him separately to be a purchasing agent. And on and on and on it went.

And in the course of all of—as we gathered up all of the records from inside of his—of Fred Trump’s real estate empire, we started counting up: How many different revenue streams has he created for Donald Trump through the years? And we got up to 295, is what we counted, what we were able to document. Some of these things, you know, they weren’t in and of themselves big money. Like, for example, Fred Trump funneled the laundry revenue from his buildings to Donald. That’s not a lot of money, but when you sort of start aggregating it, putting it all together, it’s just this mighty, endless river of money flowing constantly into the bank accounts of Donald Trump.

NERMEEN SHAIKH: I mean, one of the things that you do in your piece is you give a very strong sense of the extent to which Fred Trump seemed to have a special relationship with Donald Trump, because you explain that so much of the money accrued to Donald Trump as against his other children. So, you know, what did you learn about why that would be the case? And also, the principal illegality—I mean, what you spoke of, of Beach Haven and Shore Haven, the responsibility for that is Fred Trump’s, and is it actually technically illegal, what he did?

DAVID BARSTOW: So, in that transaction, there’s nothing illegal about that transaction that we’ve uncovered. That’s not what I’m—that’s not the point that I’m trying to make there. That’s an example, though, of one of the many different ways that Fred Trump was enriching Donald Trump, starting from a very early age and continuing on up forward. I’m sorry, the other point was?

NERMEEN SHAIKH: The question about the relationship between Fred and Donald—


NERMEEN SHAIKH: —because why did he give so much money to—

DAVID BARSTOW: So, Fred Trump had an older son, Fred Trump Jr., who initially was kind of going to be the heir apparent, right? And Fred Trump was interested in—you know, he really wanted to pass this dynasty on to one of his children, and Fred Jr. was sort of the first kind of natural heir apparent as the oldest son. But he didn’t have the passion for the business. He had other interests. He liked to fly airplanes. He loved music. Fred Trump, the father, considered Fred Trump, the son, to be a little too soft, a little too nice. And before long, it became clear that he was not going to be the heir apparent. The heir apparent was going to be Donald Trump.

And Donald Trump was very aware of his father’s disapproval of Fred Jr. He witnessed this. Fred Sr. could be quite cruel. And I think what we see in terms of—this is really from the interviews with people who worked closely with Fred Trump—they witnessed this young man, Donald Trump, sort of watching what had happened to Fred Jr. and almost forming himself into Fred Jr.’s opposite. If Fred Jr. was soft, too nice, well, Donald was going to be a shark. He was going to be a killer.

So that, I think, is sort of at the core of this father-son relationship, which is very much what this story is about. It is about a father-son relationship. These two men were extraordinarily close. Donald Trump said—we quote him that he felt that he knew his father better than anybody else in the world. And they talked daily. They spent many a weekend together. They were in constant communication. Donald Trump was a constant presence when Fred Trump would have strategy sessions with his top lawyers, his top accountants, figuring out what his next moves were. Fred Trump was often this sort of silent, lurking presence at Donald Trump’s big flashy press conferences. And so, they were this—it was more than just a father-son relationship. It was also a partnership.

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