Trump’s Most Successful Business Venture
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Paul Walczak didn’t have a plausible defense, but he did have a backup plan. As a Florida nursing-home executive, he’d defrauded taxpayers out of almost $11 million, using it to fund a lavish lifestyle. He pleaded guilty last fall, but applied for a pardon after Donald Trump retook office, claiming that he’d been prosecuted because of his mother Elizabeth Fago’s support for Trump. Only after she attended a $1 million-per-person April fundraiser, which promised face time with the president, did Trump grant Walczak a full pardon.
The press can’t declare things “bribes” without concrete proof, and it’s not entirely clear how much of the money Fago donated herself, but even the staid New York Times resorted to snark in describing the case. “A judge had justified the incarceration by declaring that there ‘is not a get-out-of-jail-free card’ for the rich. The pardon, however, indicated otherwise,” Kenneth Vogel wrote.
A million bucks is, by the standards of this administration, pretty paltry. Trump has made many millions off being president. Earlier this week, my colleague David Frum took stock of the corruption of Trump’s second term and concluded, “Nothing like this has been attempted or even imagined in the history of the American presidency. Throw away the history books; discard feeble comparisons to scandals of the past.” Yet even against this backdrop, the brazenness of the pardon’s timing makes it stand out.
Whether or not Trump was bought in this case, he’s eager to create the impression that he is for sale. And for good reason: What’s bad for the integrity of American rule of law has been very good for Trump’s bottom line. After a career of high-profile mediocrity, punctuated by flamboyant failures, the selling of the presidency is the most successful business venture of his career.
Business prowess is at the center of Trump’s renown and political appeal, but the impression that he is a titan of industry is more a creation of The Art of the Deal and The Apprentice than his actual CV. By the time he ran for president for the first time, he’d largely given up on the real-estate development that made him famous, instead concentrating on licensing his name to products and buildings. That was mostly a concession to reality: At that point, Trump was struggling to find lenders because he’d stiffed so many banks.
Trump’s businesses declared bankruptcy six times, and although he has consistently defended these filings as savvy business moves, an even savvier business move is not needing to declare bankruptcy. Trump managed the impressive task of losing money as a casino owner. Although Atlantic City was in decline as a whole during Trump’s time there, a Temple University legal scholar found that Trump underperformed competitors: “His casinos were not the ‘best’ and not even average. They were the worst.”
The president’s lofty net worth was less a product of success than a product of coming into his father’s fortune. In 2021, Forbes calculated that he would have made more money if he’d just put his inheritance in an S&P 500 index fund. (And the money that he did make might have been less if he hadn’t been committing extensive fraud.)
During Trump’s first term, he began finding ways to profit from the presidency. He charged the Secret Service big bills to stay at his properties while protecting him (even though son Eric claimed that they stayed at a discount), and had officials like Vice President Mike Pence unnecessarily rack up charges there too. Moreover, the hotel he owned near the White House became an essential location for any officials looking to influence him. There was, it seemed, a benefit to being seen—and probably more importantly, to spending some dosh. Although this seemed like a clear violation of the Constitution’s emoluments clause, attempts to enforce it were stymied in court.
But in his second term, Trump has far surpassed these relatively petty hustles. The profits started rolling in even before he won reelection, as speculators poured cash into Trump Media and Technology Group—a business with wretched numbers but high upside for anyone wishing to influence the president. Since November, the flow has increased. “Few if any legitimate investors entrusted their money to Trump’s businesses when he was out of office,” Frum noted, but now Middle Eastern governments, Chinese crypto investors, and American corporations are all finding ways to get money into Trump-related businesses. The White House claims that because Trump’s sons run these companies, no conflict of interest exists, but experts have noted that Trump hasn’t really distanced himself meaningfully from his companies and he continues to profit from them.
And nearly everyone involved is winning. Trump is making out like a bandit—perhaps very much like a bandit—and people such as Paul Walczak are getting their pardons. (Notably, Trump seems quick to pardon people charged with either fraud or corrupt use of government positions—both offenses of which he has been accused.) Unfortunately, the losers are the American people: anyone who might want the government to support rule of law, discourage corruption, and operate as something other than a concierge desk for those wealthy enough to buy in.
When news emerged earlier this month of Trump’s plans to accept a $400 million airplane from the Qatari government, Senator Josh Hawley of Missouri, a Republican, dismissed any concerns about emoluments. “I think nobody believes that Donald Trump can be bought,” he said. “I mean, what does Donald Trump need more money for?” This is either deeply cynical or painfully gullible. Trump’s entire career has been consumed by his quest for more money—this is a man who once cashed a 13-cent prank check from a Spy magazine correspondent—even if he hasn’t always been very good at it. Now that he’s found a reliable way to keep the cash rolling in, he’s not going to turn it down.
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Evening Read
How America Lost Control of the Seas
By Arnav Rao
“He who commands the sea has command of everything,” the ancient Athenian general Themistocles said. By that standard, the United States has command of very little.
America depends on ocean shipping. About 80 percent of its international trade by weight traverses the seas. The U.S. needs ships to deliver nearly 90 percent of its armed forces’ supplies and equipment, including fuel, ammunition, and food …
In the middle of the 20th century, the U.S. had a thriving, well-regulated ocean-shipping industry. Then the country turned its back on the system that made it all possible.
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Stephanie Bai contributed to this newsletter.
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