Amidst the sound and fury of the 2016 presidential campaign, much has been said by and about Donald Trump. But in his new book The Making of Donald Trump, David Cay Johnston removes the curtain to reveal how this “Wizard of Odds” really does business and more.
Using public records and his own personal reportage, Johnston – who began covering Trump at Atlantic City in 1988 for The Philadelphia Inquirer – exposes who Trump really is and his modus operandi.
Johnston won the 2001 Pulitzer Prize for Beat Reporting, as well as the Investigative Reporters & Editors (IRE) Medal and a George Polk Award. An ex-president of IRE, he wrote several New York Times bestsellers. A former Times reporter, Johnston has focused on economics and taught tax at Syracuse University College of Law.
In this candid interview, the hard-hitting investigative reporter takes the gloves off and Johnston comes out swinging, discussing Trump and organized crime; organized labor; undocumented workers; where his products are made; Wharton; licensing his name; branding; taxes; self-financing; the alt-right; racism; Steve Bannon; Goldman Sachs; The Making of Donald Trump; and the Wizard’s other flying monkeys.
Ed Rampell: Your book is titled The Making of Donald Trump. Is this a pun on the “making” of a “don,” mafia-style?
David Cay Johnston: [Laughs.] No. The title was picked by the publisher. The objective was to have a book that is descriptive, not pejorative.
Ed Rampell: In any case, tell us about the ties between Trump and organized crime and criminals?
David Cay Johnston: You have to start with Donald’s father, Fred Trump, who had a business partner named Willie Tomasello, identified in N.Y. State organized crime task force and other law enforcement reports as an associate of the Genovese and Gambino crime families. Donald, throughout his life, has embraced con artists, swindlers, mafia, reputed Russian mobsters and a major drug trafficker in his business dealings.
When he built Trump Tower, he had to take down an existing building, the Bonwit Teller department store on Fifth Avenue [allegedly destroying the landmark’s historic Art Deco bas-relief panels in the process]. Trump did something you wouldn’t normally find on any construction site in America: He had about 150-200 illegal immigrants from Poland known as the “Polish Brigade” working alongside [about 15] members of the House-Wreckers Union, which normally would provoke a shutdown of the construction. But the union was under the control of mobsters…
Trump bought his concrete for Trump Tower and Trump Plaza from S&A Concrete, owned by “Fat Tony” Salerno, head of the Gambino crime family, and Paul Castellano, head of the Genovese crime family. Throughout his career Trump has had as his business partners and associates people from organized crime. Most recently, he has traveled all across America with Felix Sater, a convicted violent felon and stock swindler… There’s photographs and videotapes of them meeting together. Sater had an office in the Trump organization’s main suite of offices at Trump Tower and a business card describing him as “senior advisor” to Trump.
Trump, however, says, ‘I wouldn’t know the guy if he was in the room with me.” Which is typical of how Donald deals with these matters. He just denies them when he’s confronted with them… That’s one of the things that should tell you Donald is not truthful… When I asked him in April about his association with a major drug trafficker who supplied him with both his personal and casino helicopters, his response was: “That was a long time ago. I don’t remember any of that.” And I said, “But you just told everyone in America on national TV that you had the world’s greatest memory.” “Well, it was a long time ago.”
Ed Rampell: Trump purports himself to be for blue collar workers. How has he treated his own employees and unions?
David Cay Johnston: [The “Polish Brigade”], here illegally, were paid $4 an hour. They worked 12 hour shifts. They slept on the site in the [Bonwit Teller] building they were demolishing by hand with sledgehammers. Trump was found by a judge to have engaged in a conspiracy to cheat these workers out of their pay and the union the money it was due for benefits… The illegal immigrants from Poland… only got paid after they took Trump’s overseer to the ledge of a high floor and proposed to hang him over the side, unless they got paid…
…Trump has a long history of cheating his own workers… He likes unions controlled by the mob. So his mob connections make sure the unions will stay in line and do what he wants. That’s why he built concrete Trump Tower, Trump Plaza, rather than steel, because the steelworkers are an honest union but the cement workers, teamsters, carpenters and demolition unions were all under the control of the mob in New York City.
Ed Rampell: Trump claims to be for “America First”… Are some Trump products manufactured overseas?
David Cay Johnston: …All of them are. I’m not aware of a single thing Donald Trump is selling – I even have the “Make America Great Again” hat, and it doesn’t say “Made in America.” His furniture is made in Turkey; his neckties are made in China; he has things made in Mexico. There may be some exception to the rule, but no, everything with the Donald Trump name on it that I’m aware of is made outside the USA.
Ed Rampell: Your book indicates that Trump did not attend and graduate from Wharton?
David Cay Johnston: Well, most people think of Wharton as its famous graduate school of finance. Donald attended the undergraduate program at Wharton for two years and got a bachelor of economics. That’s not at all equivalent to having attended the graduate school of business at Penn [the University of Pennsylvania], known as Wharton. But Donald creates this false impression that he went to the Wharton School, which is the graduate program – he went to the undergraduate program…
Ed Rampell: Does he have any graduate degrees?
David Cay Johnston: No.
Ed Rampell: Among the many odd things in Trump’s race was that news conference where he paraded and ballyhooed products bearing his name. During the campaign he went to Scotland where he touted his golf course there. Considering all the “yuuuge” amount of free media time Trump’s candidacy has received, do you think the Donald’s real hidden agenda is to get his brand name out? And if he loses will Trump deduct his presidential bid as a tax write-off?
David Cay Johnston: Okay, I don’t think there’s a hidden agenda. Donald believes he should be president of the U.S. He wants to be president; he’s been talking about it since 1985. He asked George H.W. Bush to make him his running mate in 1988… He ran in 2000, 2004, 2012, now in 2016…
If Donald had not won the Republican nomination and if he withdrew smartly, he would have been in a position to get a much better deal than he had for his TV show, Celebrity Apprentice, because he would have demonstrated he had a bigger audience than he had before and in TV it’s about numbers… That opportunity may still exist but by this point he’s seriously damaged his brand. Cadillac, the longtime sponsor of the Doral Open on the PGA Golf Tournament, withdrew and the PGA thumbed its nose at Trump by moving that tournament to Mexico. If you look at prices for rooms at some Trump hotels you’ll notice they’re pretty aggressive, compared to competitors’. What that tells you is there are a lot of people and corporations who are not booking rooms because of Mr. Trump’s racist and xenophobic attacks and his insulting the family of a dead American military officer.
…I wrote a column about whether Donald Trump can deduct some or all of his campaign? Political activity is not tax deductible. Could Trump argue that he was really doing this to promote his brand to increase income in the future? Sure, he could put that forward; but every expert I consulted said were the IRS to challenge him, they’d probably turn him down. And if he were to appeal he’d absolutely lose if he got before a federal district court, court of claims or a tax court judge. So I don’t think he can do that – but there’s another side to this, which is…
In order to avoid corruption, there’s a set of rules on how you spend campaign money. We don’t want some rich person to go to a candidate and say, “I got a jet. I’m going to let you use it for the campaign. Just pay me $1.” That’s clearly not proper. But Donald owns his own jet and helicopters. Well, the law says you have to pay charter rates for comparable aircraft – which has a built-in profit. More than 25% of the money the Trump campaign has spent to date has been for his aircraft; rooms at Trump hotels; meals at Trump restaurants; office space in Trump Tower. There’s some indication he’s pushing up the rent he’s charging for the office space. All of that has a built-in profit. So, Donald may well fulfill his claim back in 2000 when he ran on the ticket of a fringe group, the Reform Party, that he’ll be the first candidate for president to make a profit running for the office.
Ed Rampell: Trump made a big thing out of claiming he self-financed his primary race. Is he self-financing his general election candidacy?
David Cay Johnston: No. Donald began his campaign with a big loan from himself; he says he was going to disavow the loan, that is, turn it into a gift, a donation… He hasn’t filed the paperwork to do so, and I’ll be surprised if he does. In the general election he’s not raising nearly the amount of money Hillary Clinton is. He seems to be relying very heavily on the Republican National Committee to be raising money. My Aug. 23 column in The Daily Beast is about Donald’s “Potemkin Village” campaign. He doesn’t have offices all around the country as presidential candidates for the major parties normally do. He doesn’t have but a tiny little staff of people. This is much more like the film Wag the Dog, about a made-up war, than it is reality.
He also disappears for significant stretches of time form the public eye. His campaign is premised on the notion that his outlandish comments will get him lots of television coverage and attract people to vote for him. It’s not based on any traditional notion of how you run a campaign.
Ed Rampell: How does he manipulate the media?
David Cay Johnston: …Clearly, Trump has threatened many with lawsuits, including me. While he knows he cannot win because he’s a public figure, everybody also knows after he sued Tom O’Brien, author of TrumpNation, for saying he’s not a billionaire, he cost a lot of money to O’Brien’s publisher. Trump basically said later, “I knew I couldn’t win; I did it to harass him.” So news organizations, whose budgets are already in deep trouble, do not look forward to the prospect of spending millions on lawyers defending a lawsuit by Trump they know they’ll win in the end.
By the way, I’ve been reporting for 50 years – the only politician in my life who has threatened me with a lawsuit unless I wrote what he likes is Donald Trump.
The second part of the media manipulation is Donald understands most journalists do not have a deep understanding about what they write about, they are pressed for time and they’ll quote you accurately. He uses that to say things that are untrue, outrageous – knowing the number of reporters who will have the skill like I do to find a public record, understand what it means, show something he said is untrue, is very small. TV rarely does anything like that. And to most supporters of his, “You just don’t like the guy; you’re biased, you’re liberal media,” and some argument like this.
In that he is a con artist, he tells people what they want to hear or what he believes what they want to hear in order to get from them whatever it is he wants: To buy condominiums that have his name on the door or steaks, because he says they’re better than anyone else’s steaks or to vote for him for president.
He has planted stories over the years, gotten huge national publicity that Madonna, Kim Basinger and Carla Bruni were beating on his bedroom door because he’s such a great lover. He didn’t even know two of them and the third one he’d barely spoken to and she called him “the king of sleaze” and “insane.” But he got this enormous coverage so lots of people believe even to this day that these women were his lovers.
Ed Rampell: And he purported himself to allegedly be a publicist?
David Cay Johnston: Yes. Before Donald was so well known he routinely called up journalists and said he was John Baron or John Miller… People Magazine exposed him for this in 1991 and he ’fessed up to it at the time. But during the campaign this year the tape of that conversation got leaked and by the way, the People reporter says it wasn’t her tape, so the only other person in that conversation was Donald Trump posing as “John Miller,” publicist for Donald Trump. So logically, he must have been the person who gave it to the Washington Post. I know that may sound strange but it’s common to… leak terrible stories to try to get them out of the way or muddy the waters.
Trump called up NBC’s Today Show and said, “That’s not me; it doesn’t even sound like me.” It sounded exactly like him. “But there are so many scams; people trying to sound like me.” He didn’t want a campaign issue made out of the fact that he had gone around planting stories in the news that these three famously beautiful women were sleeping with him – when they weren’t… He [confessed] to People Magazine and they wrote about it at the time, a story that made fun of and mocked him…
Ed Rampell: Beneath his bluster Trump comes across like an extraordinarily insecure man, desperately trying to cover up his inadequacies.
David Cay Johnston: Yes… Trump is a world class narcissist. He does not think of other people as human beings, he thinks of them as objects. In the book I quote some of his statements on the Howard Stern radio show about women that make it clear he regards women as objects. Trump often projects on other people.
He says, “Crooked Hillary Clinton” – well, he may be talking about himself. Certainly lots of people see it that way. He insists he has a letter from a doctor – who’s apparently misled people about his credentials – who says he can absolute assure you that Donald Trump is the healthiest person who has ever run for president. Really? A man 70 years old, healthier than Obama, who plays basketball aggressively all the time? [Laughs.] Not likely to be true.
Donald has an image he wants to sell of himself and there are people who, looking right at him, if he were to say, “I’m one of the world’s greatest athletes, at 70 years old,” they’d believe it. But anybody not in the thrall of Donald Trump would say, “You’re 70, overweight, walk like a lumbering old man.”
…He claims [to sleep four hours per night.] There’s plenty of medical research that if you sleep that little for a long period of time it has rather serious effects on your health… He disappears from the public eye for extended periods of time, unlike Hillary Clinton and other candidates who are constantly in the public eye when they’re running for president.
Ed Rampell: Do you believe Trump isn’t releasing his tax returns because he’s hiding something, and if so, what?
David Cay Johnston: There’s certain things we know about why we’re never going to see Donald Trump’s tax returns. First of all, we know from public records he paid no income taxes in ’78, ’79, ’92, ’94 and recently I showed 1984, [wherein] he was audited by the State and City of New York because he said he had a side business as a consultant, with no income, but he took over $600,000 of deductions. When he was turned down on these in an audit he ordered his tax guy to file an appeal and in the City trial, his tax guy was shown the only copy of the tax return anybody could find. It was a photocopy, not an original. And Jack Mitnick, the tax lawyer/CPA, looked at that document under oath and said, “Well, that’s my signature but I didn’t prepare this tax return.”
That’s a pretty good badge of fraud. Because the only other person who would have an interest in a false tax return would be Donald Trump himself. And by the way, my first national investigative reporting award, more than 40 years ago, was for exactly this kind of case…
There’s a couple of other things we know. Donald Trump for a number of years received something in New York called the STAR property tax rebate. Everybody who owns a residence and makes less than $500,000 gets this. Donald got it. His defense was, “well, it’s a mistake; they sent it to the wrong address, they shouldn’t have done it.” No – that’s not how it works. It’s a computer program. If your State tax return shows less than $500,000 in New York adjusted gross income – and that’s identical, unless you’re retired, to Federal income – you automatically get the check. And that tells you that Donald in recent years has reported no more than $500,000 of income on his tax returns.
In addition, Donald is subject to special rules for fulltime real estate professionals. They are, by law, allowed to live tax free, if they own enough real estate, if the depreciation on it wipes out the income from other sources. So it’s unlikely that Donald Trump has paid income taxes in the last 40 years. If he has, they’ve been insignificant compared to his income.
Ed Rampell: Vis-à-vis Obama, Trump was one of the main “birthers.” What are his ties to the alt-right, the extreme rightwing of white nationalists and racists?
David Cay Johnston: Start with the launch of Trump’s campaign on June 16, 2015. Donald comes down the escalator in Trump Tower and he begins, in the middle of Manhattan, these vicious denunciations of Mexicans as murderers and rapists and of Muslims. And he has this applauding crowd of mostly young, well-dressed people. Midtown Manhattan is not exactly backwoods Mississippi or other places in the South where you’d expect people to cheer these kinds of comments. Came out the next day they were paid actors – they got $50 each to show up and applaud when directed.
When he’s had various people – David Duke, lesser known white supremacists – he makes little or no effort to separate himself from them whatsoever. I think the record is perfectly clear: Donald Trump is a racist. Donald Trump has been found in Federal and New Jersey State proceedings to have discriminated against workers on the basis of race, gender and ethnicity. He’s promoting policies that are inherently racist. His coded, dog whistle language is about having a white America.
So the associations Donald has with people on the far right, if you have any doubt, should finally be brought to the fore by his new campaign CEO, Steve Bannon. He made a ton of money as a Goldman Sachs-er. Remember how Donald Trump attacked Hillary Clinton because she got paid for some speeches to Goldman Sachs? Trump is in debt to Goldman Sachs for millions of dollars through his companies and he’s hired a former Goldman Sachs-er now to run his campaign. Bannon runs Breitbart, a fringe rightwing website notorious for making things up.
If you go there and starting digging through it, you’ll see all sorts of racially motivated animus and hatred. There’s even a section [tagged] “Black Crime.” You can match many of Donald’s most outrageous statements to articles on Breitbart. He clearly regards Breitbart as a reliable source of news, which explains, in many ways, the outlandish things he says. Bannon clearly is totally comfortable with denigrating people who are not white in America – and he’s the CEO of Trump’s campaign. All of those things together screams we are talking about a white racist who wants a white America and to roundup Mexicans, ban Muslims – including prohibiting a serving U.S. soldier or sailor who is Muslim from reentering the country if their assignment is overseas.
Ed Rampell: What do you think of speculation that Trump, Bannon and possibly Roger Ailes may create a new extreme rightwing media outlet after the election?
David Cay Johnston: I believed when Donald originally announced his campaign, that if it became clear he wouldn’t get the nomination he’d walk away from it and avoid being called a “loser” by having arranged a new TV contract better than his old one at NBC. He’s damaged his brand now – you’re not going to see any of the major television networks touch him. But there clearly is an opportunity on the right to create a new fake news organization that would make Fox News look actually “fair and balanced.”
Now that Roger Ailes has been removed there and we’re learning all these stories about his remarkably tactless efforts to get 16 girls showing up for modeling jobs to give him blowjobs and harass numerous women, including Megyn Kelly and Gretchen Carlson, of course, Rupert Murdoch had to get rid of him. Roger Ailes is a brilliant manipulator of the news – together with Bannon and Trump, would be a logical trio to create some kind of far right, conspiracy-based, denigrate nonwhite people news site. I wouldn’t be the least surprised if that’s what they do.
Absent that, the major story about Trump if he does not get elected – he may still get elected – would be Donald Trump trying to cope with the damage he’s done to his brand and the fall in revenues he’d face next year. I’m sure it’s already taking place.
Ed Rampell: What do you estimate is this purported multi-billionaire’s actual net worth?
David Cay Johnston: That’s what got Tim O’Brien sued, was putting an exact number. There’s no way to put a number on it; we don’t have the data. Here’s what we do know: Donald has testified under oath that he determines his net worth based on his emotion that day. And if you’re not laughing you didn’t hear what I said. He’s literally testified at length, under oath, that when he says his net worth is $8.7 billion or $10 billion or more than $10 billion or $11 billion or back in the day telling different reporters in the same day he was worth $3 billion or $5 billion, he’s not telling you what the differences are between his assets and liabilities. He’s telling you about his emotional state.
There’s no evidence he’s a billionaire. Now, without doubt Donald Trump is a very wealthy man. But the lifestyle he has, including his jet, only requires an after tax income of somewhere between $20-30 million. So that doesn’t require a billion-dollar income. When you have various enterprises feeding you cash, you can live an incredibly lavish lifestyle but not have assets. And that’s the real story about Donald Trump.
Donald Trump’s great business skill is not building a business, it’s not creating wealth, it’s not creating lasting jobs. Donald Trump’s skill is making deals where he puts up no money of his own and he’s guaranteed fees and payments that will come to him – often from borrowed money – so that cash flows to him. That’s his business skill.
Ed Rampell: And that’s based on the brand he’s assiduously created?
David Cay Johnston: Absolutely. Look, here’s a guy who comes from Queens and is a household name. Even before he ran for president he was a household name. Even before his NBC show, The Apprentice, he was widely known. That’s really a remarkable accomplishment… that he’s been able to pull this off. He’s the P.T. Barnum of our age.
The Making of Donald Trump has 44 pages of endnotes… and is essentially everything in the public record that he does not want you to know.
For more information see: http://www.mhpbooks.com/books/the-making-of-donald-trump/ and http://davidcayjohnston.com/.
Ed Rampell is an L.A.-based journalist originally from Queens. A repeat contributor to Rock Cellar Magazine, he co-authored “The Hawaii Movie and Television Book.” Rampell’s interview with America’s former Poet Laureate appears in 2015’s “Conversations With W.S. Merwin.”