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Billion Dollar Loser: NYT Report on Trump’s Taxes & Massive Losses May Prompt Fraud Investigation

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We look at a major exposé from The New York Times, which obtained tax information on Donald Trump that shows his businesses lost $1.17 billion from 1985 to 1994. While Trump continues to refuse to release his tax returns, printouts from his official IRS tax transcripts for a 10-year period ending in 1994 show that in multiple years during that stretch Trump appears to have lost more money than nearly any other individual taxpayer in the country and paid no federal income taxes for eight of the 10 years. “Almost every two cents of every dollar reported as losses one year, by everyone in the United States, were recorded by Donald Trump,” notes our guest, Pulitzer Prize-winning journalist David Cay Johnston, an investigative reporter previously with the Times, now founder and editor of He has been reporting on Donald Trump since the 1980s, and his new piece for The Daily Beast is headlined “Trump’s Tax Leak Hints at Potential Fraud Investigations.”

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StoryJan 03, 2023“Brazen” Fraud: David Cay Johnston on How Trump’s Tax Returns Show He Fleeced U.S. & Enriched Himself
This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: In a major exposé, The New York Times has obtained tax information on Donald Trump that shows his businesses lost more than a billion dollars from 1985 to ’94. While Trump continues to refuse to release his tax returns, the Times obtained printouts from his official IRS tax transcripts for a 10-year period ending in ’94. In multiple years during that stretch, Trump appears to have lost more money than nearly any other individual taxpayer in the United States. In both 1990 and ’91, Trump lost more than $250 million, more than double any other individual U.S. taxpayer, according to IRS documents. In eight of the 10 years, Trump paid no federal income taxes.

To unpack these revelations, we’re joined from Rochester, New York, by David Cay Johnston, the twice Pulitzer Prize-winning investigative reporter formally with The New York Times, now founder and editor of He’s been reporting on Donald Trump since the 1980s. His most recent book, It’s Even Worse Than You Think: What the Trump Administration Is Doing to America. And he has just published a piece in The Daily Beast. It’s headlined “Trump’s Tax Leak Hints at Potential Fraud Investigations.” It begins, “The myth of Donald Trump the modern Midas who turns to gold all that he touches died Tuesday afternoon.”

David Cay Johnston, welcome back to Democracy Now! What were you most surprised by in this New York Times exposé? And explain exactly what they got a hold of. It wasn’t the actual tax returns of Donald Trump from the ’80s to ’90s. What was it?

DAVID CAY JOHNSTON: The Times got, from a source who properly had them, what are called tax transcripts. The IRS takes information from your tax return and puts it into a summary that tax agents work from. So it is the official numbers. And the Times has some of Fred Trump’s tax returns. Fred is Donald’s father. And the numbers line up perfectly for those areas where they would need to be consistent. So we can rely that this is highly accurate data on what Trump told the IRS in his tax returns.

AMY GOODMAN: Who would have access to this kind of information, David?

DAVID CAY JOHNSTON: Oh, a lot of people. If you have taken out a mortgage, you signed a form saying that you submitted to having your tax information given to your lender. When Trump was raising money on Wall Street, he might have had to supply this. Litigants may have gotten it. And, of course, his own family and staff and advisers would have this information. So, there are numerous copies out there of this and other Trump tax information, just as with the 2005 Trump tax return that was mailed to my home here in Rochester.

AMY GOODMAN: So, talk about exactly what has been exposed. He lost more than a billion dollars, more than any U.S. taxpayer?

DAVID CAY JOHNSTON: Yes. Almost two cents of every dollar reported as losses one year by everyone in the United States were reported by Donald Trump. And what this shows is something I’ve been saying and writing about Trump for 30 years: He’s a terrible businessman. His business model is not to get an enterprise, to nurture it, to grow it, to make it more profitable over time. His business model is the same as a mob bust-out: Get your hands on an enterprise, squeeze all the cash out of it, don’t pay your vendors, try to cheat as best you can your employees, don’t pay the bankers—and Trump once said, “I borrowed money knowing I wouldn’t pay it back”—and then leave the carcass and go on to the next deal.

That’s why The Art of the Deal is so significant in all of this, because Trump’s business model is to rip off one person after another who gets involved with him, thinking he will make them wealthy, while he is destroying their wealth. Donald is, after Bernie Madoff, arguably the greatest wealth destroyer in American history.

AMY GOODMAN: President Trump tweeted at 4 a.m. this morning, Eastern [sic] time, “Real estate developers in the 1980’s & 1990’s, more than 30 years ago, were entitled to massive write offs and depreciation which would, if one was actively building, show losses and tax losses in almost all cases. Much was non monetary. Sometimes considered 'tax shelter,' ...... you would get it by building, or even buying. You always wanted to show losses for tax purposes....almost all real estate developers did–and often re-negotiate with banks, it was sport. Additionally, the very old information put out is a highly inaccurate Fake News hit job!” Trump tweeted, 4:00 this morning. Your response, David Cay Johnston?

DAVID CAY JOHNSTON: Well, buildings are depreciated by owners, and many big real estate developers routinely report losses on their tax returns. But Donald didn’t have anywhere near the value in the buildings he controlled to take the kind of losses you’re seeing. And he doesn’t mention things like he bought the old Eastern Air Lines Shuttle, with its broken-down, aging, gas-guzzling jets, and lost $7 million a month, and did numerous other business deals where he just lost money left and right. So he’s taken a little element of truth—if you’re a major real estate family, you probably don’t pay income taxes—and tried to make that cover all this other stuff in terms of losses that are way out of proportion.

But more importantly, you know, Donald Trump held himself out as this great dealmaker, this genius businessman. He pushed himself into the front of the pantheon of the economic heroes who were lionized in the '80s for making money, without any regard to how they made it, when he didn't belong in their league at all. To those of us who have been covering him closely and not buying at the surface what he says but checking the facts, the broad story here isn’t true. The size of the losses, however, is stupendous, much larger than I ever imagined.

AMY GOODMAN: Who was backing him? Talk about the banks. And there seems to be some unexplained large sum of money that he got at that time, $52.9 million.

DAVID CAY JOHNSTON: Right. Yeah, Trump reported one year almost $53 million of interest. Now, if he held Treasury notes, that means he had over $660 million of Treasury bonds. And if it were junk bonds, more than $350 million. We know from other things that Trump had to disclose over the years that he didn’t have a portfolio anywhere like that. So, the question is: Did he report some income that was from some other source he was trying to hide as interest? And then the question would be: Was it benign or nefarious?

And I would point out that this was during or right after the period when we know that Donald Trump was very deeply entangled with the international cocaine trafficker Joseph Wexelbaum, so deeply entangled and did so many favors for him that I’ve said, and I’ll say again, the only logical explanation for his conduct is that Donald was in the cocaine trafficking business with Joe Wexelbaum. And Donald, if you’re listening, sue me if you think you can prove what I just said isn’t true.

The backers of Trump were banks up until 1990, when he could not pay his bills as they came due. And Donald and I had a conversation one day where I said, “So how much are you worth, Donald?” “Three billion dollars.” I said, “I don’t believe you.” And he was agitated about that. But I said, “Donald, I’m a reporter. I’m a journalist. I can pay my bills as they come due. If you actually had $3 billion, you would find a way to pay your bills.” By the way, later that day he told another reporter he was worth $5 billion, which tells you that he just makes this up.

He’s a con artist. He’s a criminal. He’s a fraud. And once the banks realized that they had been had, nobody would loan money to him anymore, except Deutsche Bank, which was the preferred bank for Russian oligarchs—that is, the criminal gang around Vladimir Putin—to launder their money.

AMY GOODMAN: So, you have written that Congress should investigate fully what we know Trump was—that Trump was faking his wealth and may have been vulnerable to foreign espionage. You also say the new reporting by the Times also hints at what may be more Trump tax fraud, on which there is no statute of limitations when it is criminal rather than civil. What does that mean, criminal?

DAVID CAY JOHNSTON: Right. Well, we don’t seriously enforce the criminal tax laws in this country. There are over 150 million tax returns filed this year, and there will be maybe 800 prosecutions, and many of those will be connected to either drug trafficking or bribing politicians. It’s one of the major shortcomings in our law. But Donald Trump had two civil tax fraud trials, and he lost both of them. And at one of them, his own longtime tax lawyer and accountant, who was also his father’s tax lawyer and accountant, Jack Mitnick, testified under oath, quote, “That’s my signature on the tax return, but neither I nor my firm prepared that tax return.” That is criminal tax fraud.

And that Donald Trump was not prosecuted at the time goes to how he’s been very effective at hiring lawyers to intimidate journalists, to persuade governments that he’s not worth the time to go after, and cheat the system. So, if Congress gets its hands on his tax returns—and I’m confident they will, and if not, they’ll get his returns from New York state, which are virtually identical—I am sure they will show that Donald Trump, like Richard Nixon, is a criminal tax cheat. And let’s remember Richard Nixon’s lawyer went to prison. The only reason Richard Nixon didn’t go to prison was he was pardoned by Jerry Ford.

AMY GOODMAN: Well, we want to thank you very much for being with us. A small correction: I said Trump tweeted at 4 a.m. this morning; it was actually 7 a.m. It was 4 a.m. California time.

DAVID CAY JOHNSTON: I want to make a second: I only have one Pulitzer, Amy.

AMY GOODMAN: OK. Two corrections there. David Cay Johnston, I want to thank you so much for being with us, Pulitzer Prize-winning investigative reporter, previously with The New York Times, now founder and editor of He has been reporting on Donald Trump for decades. His latest book. It’s Even Worse Than You Think: What the Trump Administration Is Doing to America.

This is Democracy Now! When we come back, a new organization has been formed. It’s called Supermajority. Stay with us.

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