How to Get Trump to Reveal his Real Net Worth
There is a suspicion that not only I have: Donald Trump was perhaps never a billionaire. And so my hunch why Mueller would subpoena records from Deutsche Bank is that this could shed light on his real financial situation. When a bank hands out a loan, they do “due diligence,” ie. they look into their books and want to understand how risky a borrower is. The client has a strong incentive to appear as strong as possible because this means lower interest payments. There are also other upsides for Mueller: He could compare Trump’s tax returns to his declarations when he tried to obtain the loan. If he posed as richer to Deutsche Bank than to the IRS, he could be in for tax evasion. Or else he might be on the hook for fraudulent statements to Deutsche Bank. I don’t hold my breath: it could even be both.
What do we know about Donald Trump’s net worth?
Not a lot. Most of it are his own claims. In 2004, he told a journalist that he was in a range from four to five billion, a year later it was supposed to be one from five to six billion. But it could also have been 9.5 billion according to a brochure of his organization. And his casino operators were told it was just 3.6 billion. However, Trump also wanted a loan from Deutsche Bank, and what they found was only 788 million. People close to him suspected it could have been as low as 150 to 250 million. That’s a remarkable range. And since a winner like Trump can only see his net worth rise, by 2015 he hinted that he was now safely above ten billion.
Trump’s explanation for such discrepancies is that much of his net worth is his brand. It certainly has some value, but that is not arbitrary. To get a handle on it you would have to look at the cashflows it can generate, and then work backwards to what a comparable capital should be. Anyone can make claims, but if it is not pure fantasy, there would have to be some facts to back it up. However, realistically we know less about Donald Trump’s financial situation than about what extraterrestrial aliens have for breakfast. ALF liked his cats medium-rare I think. My guess is that Trump’s reticence about releasing his tax returns is not because they could reveal his connections with Russia — I assume he would simply lie about that — but that they would show he was never a billionaire, only played one on TV.
How to find out about Trump’s real net worth?
I am not a big fan of taxing wealth. Yet in this case it would have its uses. All you have to do now is take his claims at face value. He is indeed worth more than 10 billion. “Believe me!” and the IRS believes him. 1% of that would be small fry for him, a paltry 100 million or so. I don’t think he sees it this way, though. As far as I can tell he is chasing after amounts of a few million and less, which a multibillionaire would scoff at. But then this perhaps betrays how rich he really is. A few hundred million in net worth seem congruent with his behavior, so a tax bill of 100 million would pose a serious problem for him. In that case, I would expect an extraordinary correction downwards for how rich Trump claims he is.
However, that might go too far. I could easily imagine that Donald Trump would now write his net worth down to zero to avoid paying taxes at all. He is “poor as a church mouse” as one would say in German (arm wie eine Kirchenmaus). “Believe me!” But there is an ingenious trick to get around this that the Prussian state used in the 19th century. I don’t know whether they were the first to have the idea, so credit is perhaps due elsewhere. Basically, they wanted to a levy a tax on real estate, but did not want to get into the business of evaluating its worth, which can be tricky. So they let people self-declare and that led to the same problem that people could just pose as poor. There was a mean catch, though. Your declaration was published and you had to sell your property to anybody at that price!
I guess that led to some overvaluation, but then we would probably begin to pin down how rich Donald Trump really is. Not a solution in the short run. It might work faster how Mueller handles it. My hunch is that he will have a lot of fun with the data he gets from Deutsche Bank. Unless Trump starts a nuclear war because Mueller has crossed a “red line.”
Bonus for those who can read German: Here is the poem “The Three Mice” from “Ein Lustig Buch” (A Funny Book) published in 1894 by the satirist Julius Stettenheim (1831–1916). A church mouse, a synagogue mouse, and a mosque mouse tell each other about their shared plight. Morals:
In the shadow of a l l churches live
Many rich people who doubts it!
However, you will find also at their side
The poor man and the beggar.
(Full disclosure: I have republished the book and you can find it on Amazon.)
Die drei Mäuse.
Es trafen einstens sich drei Mäuschen,
Die klagten sich verzweifelt aus.
Die erste, gänzlich aus dem Häuschen,
Rief: „Ach, ich arme Kirchenmaus!
So viel ich suchen mag, ich finde
Nichts, nichts, was irgend eßbar wär’,
Nicht eine mag’re Käserinde.
So fortzuleben, das ist schwer.
Der Stein der umfangreichen Mauer,
Der steht mir freilich zu Gebot, —
Sagt, Brüder, wie schütz’ auf die Dauer
Ich mich vor sicherm Hungertod!“
„Du bist wahrhaftig zu beklagen
Und siehst auch wirklich gräulich aus,
Doch ich auch habe nichts zu nagen,“
So sprach die Synagogenmaus.
„Ich finde nur Gebetbuchsfetzen,
Mit fetten Lettern zwar bedruckt,
Die fromme Beter sehr ergetzen
Doch die man ohne Nutzen schluckt.
„Im Übrigen such’ ich vergebens,
Nichts fällt für mich, die Ärmste ab,
So hung’re weiter ich zeitlebens
Und darbe langsam mich ins Grab.“
„Ich sei, gewähret mir die Bitte,“
So sprach jetzt die Moscheenmaus,
„In Eurem Jammerbund der dritte,
Mit mir schaut es nicht besser aus.
„Sagt, Bruder, mir um Himmelswillen,
Wie mach’ ich’s, daß ich nicht verzag’,
Ich weiß den Hunger nicht zu stillen
Und geb‘ mir Müh’ den ganzen Tag.
„Ich bin im Suchen wirklich tüchtig,
Doch finde ich nicht Ein Gericht.
Allah ist groß, das ist ja richtig,
Doch mich ernähren kann er nicht.
Im Schatten a l l e r Kirchen leben
Viel reiche Leut’, wer zweifelt dran!
Doch wirst Du finden auch daneben
Den Armen und den Bettelmann.