“I have used the laws of this country … the [bankruptcy] chapter laws, to do a great job for my company, for myself, for my employees, for my family,” during the first Republican presidential debate on August 6.
At the debate he said “virtually every person that you read about on the front page of the business sections, they’ve used the [bankruptcy] law”- in fact, he even claims that successful businesses often file for bankruptcy.
However less than 20% of all publicly listed companies have filed for bankruptcy over the last three decades according to bankruptcy.com and S&P Capital IQ.
Trump has filed for four business bankruptcies, the highest number over the decades. As Chapter 11 bankruptcies, the businesses would continue to operate and eventually pay off the debt under renegotiated terms, and a reduced interest rate.
He isn’t particularly shameful of the bankruptcies either; “These lenders aren’t babies. These are total killers,” he said at the debate. “These are not the nice, sweet little people.” Whether or not these were “nice, sweet little people”, you’ve effectively abused bankruptcy laws to enrich yourself; laws meant to protect “nice sweet little people”, were being used to protect the filthy rich from the bad investments they make… Incentivising them to make riskier bets.
Please forgive me for being a little suspicious of your actions as POTUS if your primary concern is and always has been to enrich yourself… besides, if you ran your country like your companies, how many times would it fail?
Trump Taj Mahal, 1991
His first bankruptcy was the only one where he had any personal risk of losing his fortune: he had financed the casino’s construction with junk bonds, debt that bears a relatively high interest because of the (correctly predicted) high risk of default.
He was personally liable for some 900 million dollars, and he had to sell off half his share of the casino (though he still had control over it)… as well as his 282-foot-long yacht and Trump Shuttle airline. His single largest creditor was Carl Icahn, who is also the man he chose to be his Treasury Secretary if he were elected.
Trump Castle Associates, 1992
Just one year later, his other Atlantic City casinos would ALSO go bankrupt: the Trump Plaza Hotel and Casino in Atlantic City, the Trump Castle Casino Resort and the Trump Plaza Hotel in New York. He would retain his stake in the casinos.
Trump Hotel & Casino Resorts, 2004
His businesses were profitable for another decade, but you should know that bankruptcy is like a drug to Trump; he just can’t stay away for long: Trump Hotel and Casino Resort was 1.8 billion dollars in debt, and he had to give up 75% of the company for a new loan.
Trump Entertainment Resorts, 2009
After defaulting on a 53 million dollar interest payment, Trump Entertainment Resorts declared bankruptcy. Trump could not come to an agreement with his board of directors beforehand, because they weren’t quite as addicted to filing for bankruptcy as he was. He had to resign from the board as a result, and gave up his stake in the company.
In order to distance himself from the failed venture, he sued the two Atlantic City casinos which still bore his name in order to have them change their name. It shouldn’t have been hard, as the casinos probably didn’t have enough money to thread water, much less pay for the legal fees: they would file for bankruptcy again in 2014, shedding thousands of jobs.
Never to let a good bankruptcy go to waste, Trump would claim that running a company into the ground and bailing out just before it blew up, killing everyone on board, was a good thing:
“I had the good sense, and I’ve gotten a lot of credit in the financial pages, seven years ago I left Atlantic City before it totally cratered,” he said during the debate.
Is this the man you want steering America?
“I had the good sense, I’ve gotten a lot of credit in the international papers, seven years ago I left America before it totally cratered”.
This Article (Trump’s Bankruptcy Addiction: Four Times His Companies Have Filed For Chapter 11) is free and open source. You have permission to republish this article under a Creative Commons license with attribution to the author(CoNN) and AnonHQ.com.