Trump’s Brand of Transactional Politics

Trump’s father, Fred, learned early that to get lucrative assignments, he had to court the local Democratic Party. He cultivated this relationship for decades, making giant political donations and regularly attending local Democratic fundraising dinners.

Forging ties with the politically wired local federal housing administrator gave Fred a big break: huge allotments of federal mortgage insurance, which enabled him to build housing projects out at the ends of the subway lines in Brooklyn. At the time of Donald’s birth, just after World War II, Fred was one of the largest recipients of loans backed by the Federal Housing Administration in the nation.

In 1954, the U.S. Senate Banking Committee investigated the FHA and some of the developers that the agency had helped. When the senators subpoenaed Fred, they questioned him about windfall profits, whether he’d inappropriately paid his own company over-the-top fees, and whether he’d gotten an outsize portion of area FHA loans by inflating the value of his land.

Even though the committee found that Fred and other developers had engaged in “outright misrepresentation,” the businessmen suffered no repercussions. This was the first investigation of many that condemned Trump-family business practices, but resulted in no consequences.    

Fred was emboldened. He continued his financial chicanery, and passed his techniques along to his son. In 1975, the same month that President Gerald Ford refused the City’s urgent plea to help it avoid bankruptcy, and the New York Daily News published its famous “Ford to City: Drop Dead” cover, Donald Trump embarked on the deal that would make him a Manhattan real-estate mogul.

From a broke and broken metropolis, he siphoned off tax breaks—worth millions of dollars a year for 40 years into the future—for the property that is now the Grand Hyatt Hotel. This was the first time New York had offered a tax break for commercial real-estate development. To get the concessions, Trump worked his connections with both city hall and Albany.

Trump arranged an impromptu city-hall meeting to persuade the property owner to sell to him, a 29-year-old developer who was untested but who had cashable political chits. At the meeting, Mayor Abe Beame put his arm around Donald and his father, who was also there, and said, “Anything they want, they get.”

Trump then hired Governor Hugh Carey’s fundraiser to be his lobbyist, and employed a bevy of lawyers who worked for government decision makers to be his lawyers. He lied to the bank about the status of the state’s approvals and to the state about the status of his option on the property. Later, in his book The Art of the Deal, he bragged about having fooled officials. “No one even noticed until two years later,” he wrote.

Source: Theatlantic.com

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