Trump’s Cash Crunch

from The New York Times I'm Michael aaro. this is the. [Music]. daily last week when a civil court judge. in New York ruled against Donald Trump. he imposed a set of penalties so severe. that they could temporarily sever Trump. from his real estate Empire and wipe out. all of his cash to today my colleagues.

Jonah bramwit and Maggie hberman explain. what that will mean for Trump the. businessman and Trump the. candidate it's Friday February. [Music]. 23rd Jonah and Maggie thank you for. coming in thanks for having us thank you. so last week the judge overseeing one of. the many cases against Donald Trump.

issued a ruling that put simply was a. bombshell the single most devastating. penalty really ever against the former. president and that's what we want to. talk to you about the Fallout from that. ruling and we turn to you Jonah because. you have covered the case day-to-day in. the courtroom for months and Maggie. because you know Trump arguably better. than anyone as one of his biographers. Jonah just to start remind us what this.

case was fundamentally about so this. case is about fraud and specifically the. New York attorney general accused Donald. Trump his company of exaggerating the. value of their properties that includes. golf clubs hotels apartment buildings. what the AG said that Trump did was take. those things say that they were much. more valuable than they actually were. and as a result got better loan terms. from Banks from insurers profiting from.

what they said was fraud and in a lot of. ways the case became a standin for the. broader question that has hung over him. for years which is is he a fraud not. just did he commit fraud but is he a. fraud is he personally a fraud and is. this Empire that he built over decades. and this public Persona that he built. over decades essentially built on a. foundation of Lies H and Jonah we knew. really early on that the judge in this. case was Finding against Trump that. happened ago and the question was always.

around the penalties that were going to. be levied against Trump so Jonah having. covered the case day in day out in the. courtroom just talk us through at a very. high level what those penalties were and. then I think we're going to walk through. them one by one in more detail sure so. the first penalty is a cash penalty and. it's enormous it started out as 355. million so that's already a pretty. sizable number but then we're looking at. interest on top of that which actually. vaults it all the way to 450 million wow.

nearly half a billion bucks right it's. just as simple as that Donald Trump now. owes $450 million from this case alone. there's bans on Trump running his. company there's bans on him getting. loans from New York Banks and then. they've installed a monitor at the Trump. organization which sounds as if it's. maybe a little bit less of a big deal. than those other two but in fact as I. think we'll talk about is a very big. deal okay I want to start Jonah with the. eye. popping final penalty in in this case so.

just walk us through it sure so one of. the big things to know here is that this. is not a fine this is not the judge who. was the one who decided it saying Donald. Trump did these bad things and thus I am. going to find him this enormous amount. this is what's called disgorgement and. what it really is is the calculation of. how much money Trump made through fraud. so at trial the Attorney General said we. believe that it was about 370 million. plus interest and the judge did his own. calculations they're in the ruling and.

he found that it was very very close to. that so about 355 million with interest. becomes something like $450 million huge. number can you just walk us through how. you can possibly calculate that. somebody's lies about their property. value represent. 350 or I guess 400 with interest million. dollars worth of basically ill gotten. gains so one of the interesting things. in this case is that you don't have TR. victims but the banks are kind of the.

stands in for the victims these are the. entities that would have made more money. had Trump not gotten the terms that he. got so the way that this is calculated. is you look at the banks lost profits. that's an enormous amount of the. discouragement add that to interest and. then the recent sale of two properties. that was also aided by the fraud and two. properties sold by Trump that's right. and that's where you get this number. okay so the thinking is if Trump had. properly valued the properties he was. getting the loans for then the banks.

would have made more money and therefore. in a sense the judges taking that money. from Trump and giving it now to the. banks no it goes to New York state. that's the funny thing because the banks. weren't set up as victims in the way. this works so they say to Trump you made. x amount of money from your fraud no one. should be allowed to make money from. fraud in New York state we want the. marketplace to work thus to deter other. Bad actors in This Marketplace we're. going to take that money from you we're. going to give it to the good people of.

New York State got it and Maggie this. number $450 million or so huge on paper. but help us understand what it means to. Donald Trump whose wealth is always been. something of a moving Target yeah it's. huge in the wallet too our understanding. mine Jonah's and our colleague Ben. protest is understanding from looking at. documents and talking to sources is that. he has a little under $400 million in. liquid assets um that's less than he now.

owes that's correct it's not nothing but. it's less than he now owes and that's. just in one case there's another case. where he has a judgment as well so right. the Ean Carol Case where he owes I think. about 83 million 83 million plus. interest so it is a staggering amount of. money he testified in a deposition last. year that he had about 400 million in. cash let's say that that was true we. can't verify that it's still not enough. Jonah he's not going to go bankrupt over. this but how do you meet a financial o. ation this big when your cash situation.

doesn't really allow for it it's a. really difficult thing to do his net. worth is really bound up in these. properties and so he has a couple of. different ways to address this one is to. get a bond which essentially means. having someone vouch for him that he. will eventually pay this money if the. ruling is upheld on appeal that's the. easiest way to do it but it's not quite. as easy as you might think he has to. find someone to vouch for him he. probably has to put up collateral either. in the form of a bill building or in a.

huge amount of money or promises so. that's really difficult and then if he. doesn't he might actually have to resort. to liquidating one of the buildings. which again not as easy as it sounds. right Magie is it right to think that no. matter how he eventually and I suspect. we all think he will eventually be able. to put together the money to pay this. penalty that this is kind of humiliating. for somebody whose identity is so bound. up in wealth there's no question it's. both humiliating and infuriating in. terms of.

his sense of being unmasked to a degree. as we are all sitting here talking about. he's actually worth that's a big problem. for him psychologically it always has. been because he is very aware of the. impact this can have on how he sells. himself and presents himself and also. the reality of what this means for his. company a company that has remained in. New York all this time even as he became. a Florida resident okay so that is the. money and it's messy the second element. I want to understand is this decision to.

Bar Trump from running the Trump. organization and I know it also is a ban. against his two sons being involved in. the company as well so just walk us. through that it seems like it would be. very hard to take the trumps out of the. Trump organization so here's what we do. know Donald Trump who was no longer. really running the business of the. company on a day in day out basis but. still owns it he was banned from serving. as the leader of a New York company for.

3 years his two sons including Eric. Trump who is the day in day out leader. of the Trump organization they're banned. for two years and so that's one of the. big question marks here what exactly. does it mean when the person who runs. this major part of the Trump. organization may not be allowed to run. this major part of the Trump. organization how will the company. continue to function right well Maggie. what's your sense of the answer to that. I mean how knowing what you know about. the Trump organization does it function. when Dad and two sons the owner of the.

company basically and the two people. most identified as his leaders have been. told by a court don't run the company. it's complicated people want to meet. with the trumps people want to meet with. the former president Donald Trump is you. know the most famous name in the world. um when people want something out of. this company they are going to want to. have the feeling that they are meeting. with a member of the family because it. is a family company and can they well. that's a complicated question I think we. don't really know the answer and I think. a lot of that is going to get worked out.

as we go by the monitor who is. overseeing the company and I think that. you will see the attorney general. watching that process very closely the. company will still exist but the. question remains that without the trumps. as the people leading it or seen as. leading it we don't know what kind of. deals they're going to be able to strike. we don't know where this goes yeah and. this is where the third punishment the. monitor really comes right just. mentioned the monitor just explain what. a monitor is what it does and how it. fits into the new universe of the Trump. organization given this. so this monitor is a former federal.

judge her name is Barbara Jones and. she's essentially a corporate babysitter. she overlooks everything that the Trump. organization may want to do regarding. its finances and she's checking for. fraud she's looking at particular. transactions and really scrutinizing. them and the Trump organization as a. private company has just never undergone. this level of scrutiny before so when. they're trying to maneuver and think. about how they want to go about doing. their business to make money continuing.

to run the company they're going to have. this person overseeing their every move. and to be clear that was by Design the. judge specifically noted in his ruling. that Trump had expressed very little. remorse for the fraud that he found and. in fact had continued to commit it and. so the monitor is there because the. judge simply does not trust Donald Trump. and that was made completely explicit. how does Donald Trump Maggie and how do. his sons regard having a government.

monitor in their midst not happily. Michael um I analogize it to a moment in. yet another court case that Donald Trump. is facing the investigation into his. possession of classified documents at. marago where according to court filings. he said to one of his lawyers I really. don't want people going through my boxes. and those boxes were the boxes of. documents and he didn't want his lawyer. and others looking through. my boxes it's mine my company my.

government my possessions he does not. want an outside monitor there right if. you don't want your own lawyer going. through the federal government papers. owed to the federal government you don't. want a monitor looking over your. shoulders as you run your company and. then the crazy thing about the monitor. is we think of all these penalties as. these discret things there's the. financial penalty there's the Bands then. there's the monitor but they all work. together in this really difficult way. for the Trump organization because.

they're trying to scr up money they're. trying to figure out who will run the. company and all the while they have a. monitor who's answerable to the judge. making their lives slower more. complicated and ultimately more. difficult and I think when you think. about the punishments it's actually. important not to think of them as. separate but really to think about how. they complicate each other how the. penalty complicates the monitor. complicates the bands and who runs the. Trump organization and how Donald Trump. feels about it God think these all. interlock but not in a complimentary way. but like a sand in the gear kind of way. so if you're Trump if you decide that to.

pay this $450 million penalty you want. to sell a building correct me if I'm. wrong Jonah the monitor might look over. your shoulders and say no not that. building and so suddenly Trump's plan to. actually pay the penalty gets mucked up. by the monitor I think it's safe to. assume that the monitor is going to be. involved in all kinds of different. things in ways that just make Trump's. life fundamentally unpleasant right I. mean the IM image that's coming to my.

head is the one from watching Trump in. the reality TV show right like you're. fired and what it now feels the reality. of trump is is a guy saying you're fired. but I really can't run the company and I. can only fire you if the monitor says I. can fire you right that's basically as. Jonah said his hands are essentially. [Music]. tied as much as he liked rejecting this. image of a guy who you know what he says.

goes and his orders go and whatever he. says the boss is in charge he really. can't do that now I mean to the extent. that it ever was that way at the Trump. organization it really is not. [Music]. now and so a very important piece of his. Public Image and I think frankly his. self-image at this point has been. Stripped Away From. [Music]. Him.

[Music]. we'll be right. back Magie we've been talking about how. this penalty is going to hurt Trump as a. businessman and just as a rich guy who. is about to be less rich but I want you. to explain what it means to Trump as the. de facto Republican nominee for. president to have a penalty of this. scale. on the one hand it very much feels like.

a ruling like this fits into Trump's. narrative that the Democratic blue state. establishment is out to get him on the. other hand as you've started to hint at. a big part of Trump's appeal was that he. is a hugely successful businessman and. this very much undercuts that by saying. you were a fraud so how should we think. about what this penalty does to Trump a. candidate in terms of how he appeals to. his base of Voters it's very helpful to. him and frankly in terms of appealing to.

even business people who might be center. right but on the fence about Trump liked. some of his policies a lot of them. identify with him on this and think that. he's being treated unfairly is it. because of the number it's because of. the state coming and taking your. business which is how he is going to. continue to present this he is not going. to present it as they came after me for. fraudulent tactics it's going to be I. ran a successful company and they're. coming after me and that's been every. single one of his fundraising emails. about this topic right actually got one. of the emails Maggie I want to read the.

language from it this is from a Donald. Trump fundraising email that came right. after this finding do you support. president Trump more or less after every. single Witch Hunt raid indictment and. arrest that the radical left has thrown. at him he's saying this is like every. single one of the other ones well part. of his strategy Michael has been to. smear all of these court cases with one. facade right which is that this is. essentially the state coming at me and. so this plays into that and you will see. him continue to say that however to your.

question it does take a bit of anax to. the self-image that he has continued to. put out there and I think you will see. President Biden and Democrats focusing. on that focusing on it how focusing on. it by highlighting that a court just. found him guilty of widespread fraud I. think you were going to hear Democrats. saying this is how he ran his business. and he can't run his own business for 3. years why should he be allowed to run. the country for four years you're going. to hear something like that and they're.

going to try to tie it to the economy. the economy is what most voters vote on. and they'll try to suggest that he is. bad with money and because he is bad. with money he should not be in charge of. the US government and your money and I. think whether that will be successful or. not I don't know but I think that's. where this is going John I want to turn. to the idea of the animated activated. Trump base of Voters who sees this. penalty as the latest invitation to show. their support for Trump technically. speaking on paper could Trump harness.

that anger to basically fund raise his. way out of the financial hole he's now. in could he set up a legal defense fund. could he ask supporters to basically. bail him out of this hypothetically. speaking 100% he can absolutely do that. the one thing that I think he could not. do is tell people that the money is for. a different purpose than it is but if. he's upfront about what this money is. for and given what Maggie said I don't. see that there's any reason not to be.

upfront he can set up a legal defense. fund and see if he can raise some money. now whether he can actually raise that. money and this is a good question for. Maggie I think just for this particular. problem that's another question Maggie. well it's money that in theory could be. going to his campaign and so his. campaign is already underfunded compared. to President Biden's and we saw that. again in numbers that came out in recent. days so I think he is going to have to. make choices if that's the route he. takes right every dollar you ask someone.

to give you for your legal defense Fund. in this case is potentially a dollar. that doesn't go to the campaign that as. you're saying is already falling behind. Joe Biden in terms of fundraising. correct and so this is a a low dooll. fundraising base that he has gone to. over and over and over again his donors. his own donors and they've been asked to. rise up and defend him over and over and. over again fatigue may be inevitable and. so at a certain point you know there are. choices that will have to be make with. eight months left of this campaign and.

him as the likely nominee just to to. think of this another way this judgment. alone just the New York AG case putting. aside the EEG Carroll case just the New. York AG case is nearly half a billion. dollars uh a presidential nomination for. for a general election candidate that. campaign generally costs about a billion. dollars so it's about half the cost of a. presidential run in 2024 so if you put. them together you're saying it's going. to be a lot to ask the American people.

even Trump's most fervent supporters to. hand over 1.5 billion which would be the. cost of a campaign as well as bailing. him out of this legal predicament it's a. it's a lot of money I want to turn to a. delicate but really interesting question. which is what does it look like for. Trump to run for president and. potentially win back the presidency when. he's basically out of cash and does that. create a new set of incentives for him. when he's president that we should be. thinking about well you know just on the.

simplistic level he would get free. housing and free Transportation so put. that aside it's so hard to answer. because when he was president starting. in 2017 he never put the company to. Blind trust they stopped doing foreign. deals and his sons took over but there. were all sorts of foreign officials who. stayed at the Trump Hotel and that was. seen as a a back door way of getting. foreign money to Trump and remember it's. not just the second he becomes president. there's 8 months left. of a presidential race where he's the.

likely nominee and there could be. foreign governments or foreign entities. that are going to try to Curry favor. with him by doing deals now your thing. if you're a business who wants to get in. the good graces of the next president of. the United States this is a good moment. because he's not president and can do a. deal and those companies would know that. he needs money correct I mean I was. going to say just speaking very. hypothetically we know what Trump's past. behavior is and we know what the incent. here would be and we're really looking. at Uncharted landscape in terms of what.

this might actually look like I think. that these are guesses we should. emphasize that they gu have no we have. no idea what will actually happen but. but there is a theoretical case they're. well-informed guesses yeah okay got it. we've talked a lot Maggie especially. with you about how reelection for Trump. has been key to his plan for solving the. legal problems he has in so many. different cases the idea is he could win. he could ask his future return attorney. general to drop the federal cases.

against him the classified documents. case the January 6. case civil cases and local cases like. this case would seem to be more. complicated so does becoming president. do anything to alleviate the unique. burdens of this case and this penalty. short answer is no I mean one one thing. has absolutely nothing to do with the. other now you are correct we have had. any number of conversations about the. impact that him winning a second term. could imp act the federal cases against. them and there are two but there's also.

two State cases in addition to this. particular case is a civil case the Ean. Carol Case is a civil case there is. nothing he can do about that now could. becoming president slow down the gears. of certain things in theory yes again we. are facing such a new Dynamic here with. all of this were he to become president. again that I I don't even know how to. Fathom how half of this would work um. but the short answer is he does not have. a magic wand as president impact these. cases but in a way you'd rather be.

president if you're in this situation. than not be president I think he. discovered through all of the legal. Trails he faced while he was President. it was better to be president than. not but what's really interesting kind. of about where we are now and what we're. talking about is it is different for him. to be after this case and In This Moment. facing actual consequences of this type. where the penalty has already been. demanded of him.

Trump seems to face a lot of heat but he. always gets out of it you know he gets. out of these bankruptcies he gets out of. the Access Hollywood tape during the. 2016 election he gets out of. impeachments twice exactly yeah but here. we already have the consequences. demanded of him and it seems highly. unlikely right as he's running for. president again that he's going to be. able to get out of paying these things. or dealing with them in some. [Music]. way.

[Music]. well Maggie Jonah thank you very much. thank you thank. [Music]. you we'll be right. back. here's what else you need to day the.

mother of Alexi naali the Russian. opposition leader who has died in prison. said that the government has refused to. release her son's remains unless she. agrees to a secret funeral that would. draw no public. attention in a video lud na accused the. government of Vladimir Putin of.

illegally blackmailing her by quote. telling me where when and how Alexi. should be buried meanwhile during a. fundraiser President Biden called Putin. a quote crazy so his harshest language. to date for the Russian leader in. response the Kremlin dismissed Biden's. remarks as quote Hollywood cowboy style. Behavior designed to win him.

[Music]. re-election today's episode was produced. by Will Reed and Mary Wilson it was. edited by Brendan kinken BG with help. from Rachel quer contains original music. by Diane Wong and Dan Powell and was. engineered by Alysa Moxley our theme. music is by Jim runberg and Ben lansburg. of wonderly special thanks to Ben.

[Music]. protest that's it for the daily I'm. Michael borro see you on. [Music]. Monday.