For decades, Donald Trump has sold himself to the public as a fantastically successful businessman. Nothing is more central to his personal branding. So you would think that talking about business would be Trump’s strength in a presidential debate, especially against Hillary Clinton––she knows more about foreign and domestic policy, but has almost no business experience herself.
Somehow, it wasn’t so Monday.
Exchanges about business produced some of the worst moments that Trump had all night, moments that are likely to haunt him in campaign ads and YouTube clips. At times, giving better answers would have been easy. At other times, Trump’s opponent skillfully maneuvered him into addressing hard to defend attacks.
All this unfolded in these four exchanges. Behold.
In The Big Short, Michael Lewis’ nonfiction book about the 2008 financial crisis, the main characters are all people who saw the housing crash coming before anyone else, shorted the market, and stood to make hundreds of millions of dollars. In one memorable scene from the film adaptation, two young investors, Charlie Geller and Jamie Shipley, are trying to figure out how to execute the necessary trades. Finally they succeed, locking in positions likely to make them filthy rich.
They began to dance in celebration, but are quickly reprimanded by their mentor, Ben Ricket, who was portrayed by Brad Pitt.
Ben: Do you even know what you just did?
Charlie: Yeah. We made the deal of our careers.
Ben: You just bet against the American economy. If we’re right it means people lose homes, jobs, retirement savings, pensions. These aren’t just numbers. For every point unemployment goes up, 40 thousand people die. Did you know that?
Jaime: We were just excited.
Ben: Just don’t fucking dance. Okay?
Several characters in The Big Short bet against housing derivatives, made hundreds of millions, and nevertheless feel furious at the system for all the innocent people made to suffer by the abhorrent, indefensible frauds perpetrated by Wall Street. They weren’t exactly hoping the economy would collapse. They were horrified by the idea. They just knew it would happen regardless of their savvy shorts.
The payoff was huge… yet, it was bittersweet.
I thought of those individuals, and their portrayal in the film, during an exchange about the financial crisis and its consequences. Trump didn’t short the housing market. He didn’t stand to gain a half-billion dollars in a crash, having never made the prescient trades required. But circa 2006, he was still rooting for a collapse, merely because then, housing prices would fall, and he could snap them up cheap.
Hillary Clinton raised the matter:
CLINTON: Well, let’s stop for a second and remember where we were eight years ago. We had the worst financial crisis, the Great Recession, the worst since the 1930s. That was in large part because of tax policies that slashed taxes on the wealthy, failed to invest in the middle class, took their eyes off of Wall Street, and created a perfect storm. In fact, Donald was one of the people who rooted for the housing crisis. He said, back in 2006, “Gee, I hope it does collapse, because then I can go in and buy some and make some money.”
Well, it did collapse.
Here is the actual 2006 quote, where Trump both expresses a desire for the housing market to collapse and explains why he doesn’t expect the impending crash:
Here is how Trump responded on Monday:
TRUMP: That’s called business, by the way.
CLINTON: Nine million people — nine million people lost their jobs. Five million people lost their homes. And $13 trillion in family wealth was wiped out.
He didn’t say, “I never expected it to be as bad as it was, and of course, when I saw how many families wound up suffering, I wished that it never would’ve happened.”
He said, “that’s called business.”
Is it? There were businessmen who behaved better.
Buying real estate at post-crash prices is business. And there isn’t anything wrong with it. But “sorta hoping” for a war so that you can sell bullets, or a fire so you can collect on the insurance, or a housing bust to scoop up foreclosed homes, seems like more than “just business.” The last one seems like the sort of thing one might forgive in a person too young to know better, trying to buy their first house or start building a fortune. But rooting for the collapse of the American housing market in your sixties, fully aware of the implications, when you already have more wealth than you’ll ever need, because you can use your spare cash to pad your billions?
Then rooting for countless families to be foreclosed upon is awful.
Indifference to huge swaths of America may matter little for a Manhattan mogul, but matters very much for someone asking to be entrusted with representing every American. And politically, an answer like that cannot help Trump in a swing states like Florida, Nevada, or Arizona, where so many families were devastated by the housing crash.
In a later exchange, Hillary Clinton attacked her opponent at length for not releasing his tax returns. This line of criticism couldn’t have been more predictable. But I cannot believe that Trump’s interjection was planned by his campaign:
CLINTON: For 40 years, everyone running for president has released their tax returns. You can go and see nearly, I think, 39, 40 years of our tax returns, but everyone has done it. We know the IRS has made clear there is no prohibition on releasing it when you’re under audit.
So you’ve got to ask yourself, why won’t he release his tax returns? And I think there may be a couple of reasons. First, maybe he’s not as rich as he says he is. Second, maybe he’s not as charitable as he claims to be. Third, we don’t know all of his business dealings, but we have been told through investigative reporting that he owes about $650 million to Wall Street and foreign banks. Or maybe he doesn’t want the American people, all of you watching tonight, to know that he’s paid nothing in federal taxes, because the only years that anybody’s ever seen were a couple of years when he had to turn them over to state authorities when he was trying to get a casino license, and they showed he didn’t pay any federal income tax.
TRUMP: That makes me smart.
CLINTON: So if he’s paid zero, that means zero for troops, zero for vets, zero for schools or health. And I think probably he’s not all that enthusiastic about having the rest of our country see what the real reasons are, because it must be something really important, even terrible, that he’s trying to hide. And the financial disclosure statements, they don’t give you the tax rate. They don’t give you all the details that tax returns would. And it just seems to me that this is something that the American people deserve to see. And I have no reason to believe that he’s ever going to release his tax returns, because there’s something he’s hiding.
And we’ll guess.
We’ll keep guessing at what it might be that he’s hiding. But I think the question is, were he ever to get near the White House, what would be those conflicts? Who does he owe money to? Well, he owes you the answers to that, and he should provide them.
Again, a billionaire on stage telling Americans that he pays what he owes and no more, just like them, would be defensible, or even likable in a charismatic enough candidate. But bragging constantly about your wealth, then implying to Americans that you’re smart because you pay no taxes at all when all of us do pay taxes? That seems indefensible. And it may explain why Trump is always being audited!
In a later exchange, Trump again left the impression that he pays no income taxes. And the back-and-forth only got worse for him from there. Here’s the transcript:
CLINTON: And maybe because you haven’t paid any federal income tax for a lot of years.
And the other thing I think is important...
TRUMP: It would be squandered, too, believe me.
CLINTON: ... is if your — if your main claim to be president of the United States is your business, then I think we should talk about that. You know, your campaign manager said that you built a lot of businesses on the backs of little guys. And, indeed, I have met a lot of the people who were stiffed by you and your businesses, Donald. I’ve met dishwashers, painters, architects, glass installers, marble installers, drapery installers, like my dad was, who you refused to pay when they finished the work that you asked them to do. We have an architect in the audience who designed one of your clubhouses at one of your golf courses. It’s a beautiful facility. It immediately was put to use. And you wouldn’t pay what the man needed to be paid, what he was charging you to do...
TRUMP: Maybe he didn’t do a good job and I was unsatisfied with his work...
CLINTON: Well, to...
TRUMP: Which our country should do, too.
CLINTON: Do the thousands of people that you have stiffed over the course of your business not deserve some kind of apology from someone who has taken their labor, taken the goods that they produced, and then refused to pay them? I can only say that I’m certainly relieved that my late father never did business with you. He provided a good middle-class life for us, but the people he worked for, he expected the bargain to be kept on both sides. And when we talk about your business, you’ve taken business bankruptcy six times. There are a lot of great businesspeople that have never taken bankruptcy once.
You call yourself the King of Debt. You talk about leverage. You even at one time suggested that you would try to negotiate down the national debt of the United States.
TRUMP: Wrong. Wrong.
First, Trump lied. He did once suggest negotiating down national debt. More to the point, confronted with the attack that he stiffed thousands of working people who helped build his properties, reneging on his word, Trump doesn’t plead innocent. He says, “Maybe he didn’t do a good job and I was unsatisfied with his work.”As USA Today has reported, we’re talking about at least hundreds of people, not one guy.
This seems like a pattern of behavior that should hurt Trump with working people.
And the exchange elicited this:
True story - my Dad's company was stiffed by Trump on a six figure telecom job in the 1980's. Trump told them it would cost more to sue him.— Brian Walsh (@brianjameswalsh) September 27, 2016
Prior to leaving Capitol Hill, Walsh served as current Senate Republican Whip John Cornyn’s chief communications strategist – first in his official Senate office as Communications Director and then at the National Republican Senatorial Committee (NRSC) for both the 2010 and 2012 election cycles during which Republicans gained five new Republican Senate seats.
Trump went on to explain, “on occasion, four times, we used certain laws that are there. And when Secretary Clinton talks about people that didn’t get paid, first of all, they did get paid a lot, but taken advantage of the laws of the nation. Now, if you want to change the laws, you’ve been there a long time, change the laws. But I take advantage of the laws of the nation because I’m running a company. My obligation right now is to do well for myself, my family, my employees, for my companies.”
Was that about bankruptcies? Not paying contractors with some kind of legal loophole? It’s unclear. But the bottom line is this: millions of Americans know and interact with lots of small business owners who do well for themselves without screwing anyone. In contrast, Trump seems like an unethical businessman.
The final exchange on business came after a question on race in America. Hillary Clinton slipped this into her answer:
Donald started his career back in 1973 being sued by the Justice Department for racial discrimination because he would not rent apartments in one of his developments to African-Americans, and he made sure that the people who worked for him understood that was the policy.
He actually was sued twice by the Justice Department. So he has a long record of engaging in racist behavior. And the birther lie was a very hurtful one.
You know, Barack Obama is a man of great dignity.
And I could tell how much it bothered him and annoyed him that this was being touted and used against him. But I like to remember what Michelle Obama said in her amazing speech at our Democratic National Convention: When they go low, we go high. And Barack Obama went high, despite Donald Trump’s best efforts to bring him down.
The Washington Post has reported on the discrimination case that Clinton referenced:
When a black woman asked to rent an apartment in a Brooklyn complex managed by Donald Trump’s real estate company, she said she was told that nothing was available. A short time later, a white woman who made the same request was invited to choose between two available apartments. The two would-be renters on that July 1972 day were actually undercover “testers” for a government-sanctioned investigation to determine whether Trump Management Inc. discriminated against minorities seeking housing at properties across Brooklyn and Queens.
Federal investigators also gathered evidence. Trump employees had secretly marked the applications of minorities with codes, such as “No. 9” and “C” for “colored,” according to government interview accounts filed in federal court. The employees allegedly directed blacks and Puerto Ricans away from buildings with mostly white tenants, and steered them toward properties that had many minorities, the government filings alleged.
In October 1973, the Justice Department filed a civil rights case that accused the Trump firm, whose complexes contained 14,000 apartments, of violating the Fair Housing Act of 1968.
The case, one of the biggest federal housing discrimination suits to be brought during that time, put a spotlight on the family empire led by its 27-year-old president, Donald Trump, and his father, Fred Trump, the chairman, who had begun building houses and apartments in the 1930s. The younger Trump demonstrated the brash, combative style that would make him famous, holding forth at a news conference in a Manhattan hotel to decry the government’s arguments as “such outrageous lies.” He would also say that the company wanted to avoid renting apartments to welfare recipients of any color but never discriminated based on race.
...Two former Trump employees, a husband and wife who rented properties, were quoted in court documents as saying they were told that the company wanted to rent only to “Jews and Executives” and “discouraged rental to blacks.” The couple told the government’s lawyers that they were advised that “a racial code was in effect, blacks being referred to as ‘No. 9.’ ”
Other rental agents employed by the Trumps told the FBI that only 1 percent of tenants at the Trump-run Ocean Terrace Apartments were black, and that there were no black tenants at Lincoln Shore Apartments. Both were on Ocean Parkway in Brooklyn. However, minorities were steered to a different complex on Flatbush Avenue in Brooklyn, Patio Gardens, which was 40 percent black, the government said.
One black woman, for example, was turned away at a heavily white complex but told that she should “try to obtain an apartment at Patio Gardens,” where “a black judge had recently become a tenant,” according to government filings.
Phyllis Spiro, a white woman who went undercover in 1973 at a Trump property, told investigators how a building superintendent acknowledged to her “that he followed a racially discriminatory rental policy at the direction of his superiors, and that there were only very few ‘colored’ tenants” at the complex, according to court records.
Here’s how Donald Trump explained what happened in the debate:
“Now, as far as the lawsuit, yes, when I was very young,” he said, “I went into my father’s company, had a real estate company in Brooklyn and Queens, and we, along with many, many other companies throughout the country — it was a federal lawsuit — were sued.”
“We settled the suit with zero — with no admission of guilt. It was very easy to do. I notice you bring that up a lot. And, you know, I also notice the very nasty commercials that you do on me in so many different ways, which I don’t do on you. Maybe I’m trying to save the money. But, frankly, I look — I look at that, and I say, isn’t that amazing? Because I settled that lawsuit with no admission of guilt, but that was a lawsuit brought against many real estate firms, and it’s just one of those things.”
Notice that Trump didn’t say, “we were innocent.” He said, “we settled...with no admission of guilt.” And he cited the fact that others were sued as if it was exculpatory. In fact, many were sued because racist housing discrimination against black people was then a common problem that devastated whole communities.
Or as Trump put it, “it’s just one of those things.” You know, one of those things where the business you run discriminates against black people. One of those deeply racist things.
* * *
Trump got in some of his usual, vague self-praise in regards to his business: “Look, it’s all words, it’s all sound bites. I built an unbelievable company. Some of the greatest assets anywhere in the world, real estate assets anywhere in the world, beyond the United States, in Europe, lots of different places. It’s an unbelievable company.”
But the major exchanges on the subject were all bad for him. Voters who just started paying attention learned, in a brief span of time, that Trump was hoping for the housing crash that devastated millions of working Americans (“that’s business”); that he may be hiding his tax returns because he at least sometimes pays zero in federal taxes (“that makes me smart”); that he stiffs the working class tradespeople who help construct his buildings (“Which our country should do, too); and that the federal government sued him at the beginning of his career for blatant racism against black renters (“no admission of guilt/just one of those things”).
The sound bytes tell the story.
On style and substance, the Republican nominee had an unmitigated disaster of a night. His opponent lured him into errors in exactly the area where he was seen as strongest.
She took care of business.