On Friday, journalist Jonathan Greenberg published a stunning exposé of how Donald Trump, in his younger years, managed to maintain his brand of success and fortune — and keep attracting investors to his projects — even in the face of devastating business losses and incompetence.
The short answer: he threatened, intimidated, and bullied reporters out of telling the truth about his business empire.
"I turned up three never-before-published letters from Trump to Forbes from 1989, in which he claimed to be worth $3.7 billion," wrote Greenberg. "We now know that he reported losses of about $100 million that year and that he was treading near insolvency. Then I started to contact other people who had collided with Trump in those years. Journalists told me how he'd tried to block their reporting on his empire — by making up ethical scandals about them, furnishing fake documents and, in one case, threatening to expose the private life of a closeted media executive. Wall Street analysts witnessed a campaign of intimidation that began when Trump got one of them fired for (correctly) doubting his casinos' ability to pay off their debts."
In the late 1980s, Trump reportedly put out inflated estimates of his business assets and profitability that were perfectly timed to get him onto the coveted "Forbes 400" list of richest people in America — even though, behind the scenes, his real estate empire was bleeding money and floating junk bonds. But in 1990, when Forbes Senior Editor Richard Stern and writer John Connolly prepared a story on this, Trump bullied them into gutting the story.
"On the Monday of the week the story was to be published, Stern met with Trump to seek a comment he could include in the article," wrote Greenberg. "The mogul exploded, threatening to sue Forbes. On Tuesday, 'orders came from on high' to change the story's estimate of Trump’s net worth to $500 million, Stern recalls. 'I got into a shouting match with [Jim] Michaels,' Forbes's powerful top editor, Stern says. 'Forbes bent. We had to jigger the numbers to give Trump a positive net worth.' (Michaels died in 2007.) Connolly says the cover line was also changed, from 'Is Trump Broke?' to 'How Much Is Donald Really Worth Now?,' which is how it appeared on May 14, 1990."
On at least one occasion, Trump outright ruined the career of someone who was on the verge of exposing him.
"In March 1990, Marvin Roffman, one of the nation's leading casino industry stock analysts, told Wall Street Journal reporter Neil Barsky that Trump might not be able to gross the $1.3 million per day he needed to keep the Taj Mahal going," wrote Greenberg. "Trump retaliated. He called Roffman’s boss at Janney Montgomery Scott and threatened to sue unless the firm fired Roffman or printed a letter from him saying, in Roffman’s telling, 'that sonofabitch reporter Barsky misquoted' him and that 'the Taj Mahal was going to be the greatest success ever.' Roffman, a 17-year veteran analyst, resisted and was fired the next day. The following year, not long before the Taj went belly up, Roffman won a $750,0000 arbitration decision against his former firm. Soon after that, he settled a defamation suit, for an undisclosed sum, against Trump."
It turned out that Roffman was right, and the Trump Taj Mahal was eventually sold off for pennies on the dollar amid one of Trump's many bankruptcies.
"Trump had waged a relentless, vindictive campaign to build his own myth by suppressing the facts: Between the collapse of his empire in 1991 and the issuance of more than $1 billion in Trump Hotels and Casino Resorts stock and junk bonds by 1996, he’d compromised the truth-telling capacity of Forbes magazine, the Wall Street Journal, TV broadcasters, Arthur Andersen and casino analysts on Wall Street," wrote Greenberg. "By the time Trump resigned in 2009 as chairman of the public company he founded, he had paid himself an estimated $82 million in personal compensation, while the company's stocks and bonds had become nearly worthless."
"His brand survived all that, and even thrived, because he wasn't just concocting tales of his greatness; he was also forcing others to repeat them, or at least not to contradict them," concluded Greenberg. "It was a strategy that more recently has paid off handsomely against onetime opponents like Sen. Lindsey Graham. Nobody can succeed on this scale simply by lying. Trump’s greatest and most cynical skill, honed during the 1980s and 1990s, was learning how to win by silencing truth-tellers and suppressing the truth when it matters most."