The Secret That Was Hiding in Trump’s Taxes

Media coverage depicted the president as a brilliant deal maker, but he claimed more than a billion dollars in losses over the course of a decade.

A "Trump" sign is taken down from a building
Mark Makela / Reuters

Over the course of a decade beginning in the mid-1980s, Donald Trump publicly presented himself as a highly successful entrepreneur even as he claimed business losses exceeding $1 billion, The New York Times reported on Tuesday. “Over all,” the newspaper explained, “Mr. Trump lost so much money that he was able to avoid paying income taxes for eight of the 10 years.”

The scoop reflects poorly on Trump, who willfully misled the public for a decade in hopes of fraudulently representing himself as a man with a Midas touch. But he could not have succeeded without the assistance of many Americans, some mercenary, others over-credulous, who helped to spread the deceit and deception, generating countless newspaper articles, magazine stories, and TV segments that misinformed the public about the publicity hound’s record in business.

New evidence of his staggering losses in that decade therefore provides an apt occasion to reflect on the media’s complicity in Trump’s brazen deceit and deception.

Tony Schwartz, the ghostwriter who penned The Art of the Deal, has already apologized for falsely portraying the huckster from Queens as “a charmingly brash entrepreneur with an unfailing knack for business,” telling The New Yorker, “I put lipstick on a pig. I feel a deep sense of remorse that I contributed to presenting Trump in a way that brought him wider attention and made him more appealing than he is.”

But Schwartz was far from alone in abetting Trump’s lies. Indeed, the television producer Mark Burnett could not have “resurrected Donald Trump as an icon of American success” with The Apprentice in the Aughts if not for portrayals of Trump as a thriving tycoon in an era when he was hemorrhaging money.

Here’s a Newsweek cover from 1987:

And a Time cover from 1989:

Neither cover image suggests a man who inherited a fortune from his father only to suffer 10-figure losses during a stretch when he passed himself off as a rainmaker.

Back in 2011, Elspeth Reeve flagged other bygone estimates of Trump’s net worth:

  • March 1988: The New York Times says Trump is worth $3 billion when he buys the Plaza Hotel in Manhattan for $390 million.
  • October 1988: Trump estimated to be worth $1 billion by Forbes magazine.
  • July 1989: Trump’s net worth estimated to be $1.5 billion—an increase of $500 million in 10 months. He makes Forbes’ World Billionaires list for the first time.
  • June 1990: Under the headline “As A Laughingstock, Donald Trump Is Paying Big Dividends,” The Philadelphia Inquirer writes that Trump had had a very bad year marked by marital and financial fiasco, including the sting of ex-wife “Ivana’s charge that her estranged hubby is not a billionaire but worth a mere $400 million to $600 million.”
  • July 1990: Trump was dropped from Forbes’ list of the world’s billionaires after the value of his real estate business plummeted. Forbes estimated he was worth about $500 million that year. Others guessed less.
  • January 2000: Trump claims he’s worth $5 billion. But even his closest associates don’t entirely back that up. The Wall Street Journal explained that “several of his billions are based on profits that are far in the future—and far from guaranteed.” Abraham Wallach, executive vice president of Trump Organization, hedged by saying, “Donald exaggerates sometimes. He’s talking about futures.” The newspaper noted that Forbes had listed Trump’s fortune at closer to $1.6 billion, but New York real estate professionals asserted his fortune “falls far short” of even the lower figure.
  • April 2000: Wallach quickly got more in line with his boss’s talking points when he spoke with Fortune a few months later. Reporter Jerry Useem recounts that when his magazine was putting together a list of billionaires, “Trump called so many times to haggle over his net worth that an intern was assigned to field his calls.”
  • March 2005: Just after the first season of The Apprentice, Forbes put Trump’s worth at $2.6 billion, ranking him in a 15-way tie for 228th richest person in the world.
  • October 2005: Timothy O’Brien’s book TrumpNation charges that Trump is worth just $150 million to $250 million. Trump sued for defamation, and lost.
  • 2005: Documents from the defamation suit revealed that as it was underwriting a $640 million loan to Trump to build in Chicago, Deutsche Bank estimated Trump’s evaluated his net worth was $788 million. Trump disputed the number.

In the worst cases, media outlets credulously accepted Trump’s claims. He was almost invariably covered as if he was much richer than the most careful estimates available at the time suggested.

He was rarely covered as if he were one of the biggest business failures in America, even in the era when, per the IRS data just reported by The New York Times, “year after year, Mr. Trump appears to have lost more money than nearly any other individual American taxpayer,” and Trump’s “core business losses in 1990 and 1991—more than $250 million each year—were more than double those of the nearest taxpayers in the I.R.S. information for those years.”

And no matter how many times he’d been caught being dishonest before, many treated his subsequent claims with the same presumption of legitimacy normally extended to people without a long track record of self-serving mendacity. Archives of media organizations contain countless examples.

To end their grifter-enabling complicity, America’s media institutions should now set the record straight: Each TV station, newspaper, and magazine that broadcast or published ’80s and ’90s coverage of Trump that misled its audience as to his wealth or success should revisit its claims in light of the new information unearthed by The New York Times, publishing updates and corrections. It won’t be easy at these resource-starved institutions, but they owe it to their readers.

And Random House, which published The Art of the Deal, should put out a statement clarifying that the purported author was no great deal maker at the time.

That is how institutions make themselves accountable for spreading untruths, a discipline that can’t help but influence today’s writers and editors to be more careful. Almost no one at the time could’ve anticipated how much misleading claims about Trump, of all people, would matter to the future of the world.

But it all mattered.

Let that be a lesson for today’s tabloids, gossip columnists, over-credulous or mercenary journalists, and reality-television producers. It might be tempting to salve your conscience as Tucker Carlson told GQ: “There’s this illusion … that everything is meaningful, everything important,” he said. “It’s not.” A more honorable approach, conveyed with nuance in the novel Cloud Atlas, by David Mitchell, can be distilled as follows: Strive to act as though everything matters––one never knows what will turn out to be world-changing.

For the public at large, Trump’s old tax returns are a reminder, at least for those of a certain age, of how effectively the man’s lies distorted our image of him and the degree of success that he was ostensibly enjoying in the late ’80s and early ’90s.

In truth, he was secretly flailing, piling up debt at properties that he later left bankrupt. Now he brags that he’s doing a bang-up job running America. Don’t get fooled again.