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In US politics it pays to follow the money. In Donald Trump’s case, money is escaping him in the form of various fines and damages – worth around $530 million in the last month. The settlements are not high enough to trigger Trump’s bankruptcy. His net worth is around $2.6 billion. But they will swallow up its cash balance and severely limit the Trump Organization’s ability to operate. He faces a three-year ban from taking out loans in New York, where he exploited his name in the first place.
The obvious cure for Trump’s economic problems is to win back the White House. Unlike any federal conviction Trump might face between now and Election Day, it is clear that as president he would not have the power to pardon himself for his wave of civilian casualties. But another term would give him plenty of room to pad family coffers in other ways. The world is mostly focused on the possibility of Trump withdrawing America from NATO, abandoning Ukraine and starting new trade wars. Trump’s domestic opponents, meanwhile, are concerned about the threat he could pose to America’s constitutional order.
All these ghosts are real; most are highly probable. What is guaranteed, however, is that Trump would go for the money. Shortly before being inaugurated as president in January 2017, Trump doubled his Mar-a-Lago membership fee to $200,000. In his first two years in office, Trump’s hotels took in about $7.8 million in business from foreign governments, mostly Saudi Arabia, China, Qatar, Kuwait and India. During Trump’s presidency, China accelerated the creation of numerous brands for his daughter Ivanka Trump’s companies. Shortly after leaving office, her husband, Jared Kushner, received a $2 billion investment from Saudi Arabia’s sovereign wealth fund. That’s not to mention the various licensing deals that Eric and Donald Jr – Trump’s sons, who ran the business while he was president – have struck overseas. It was the furthest thing from blind trust you can imagine.
In theory, it is illegal to give gifts to the president of the United States. Short of a direct cash bribe, however, such emoluments are difficult to prove in court. The Supreme Court rejected petitions to review Trump’s conflicts of interest in 2021, saying they were no longer relevant because he had left office. Since then, Trump has diverted about $50 million in campaign donations to pay his legal bills. If the Federal Election Commission had had stricter and clearer rules, such misreporting would not have been permitted. As Trump keeps reminding his base, however, rules are for idiots. The only realistic obstacle to Trump’s monetization of the presidency is the American electorate.
Given that Trump’s net worth could shrink, the opportunities to influence his decisions would be great. It is no coincidence that the so-called Muslim ban in the early days of his presidency excluded the wealthy Gulf countries. It should have been called the “poor Muslim countries ban”. His first foreign trip as president was to Saudi Arabia. Saudis were the second most profitable occupants of Trump Towers in New York and his hotel in Washington in his first two years. China was first. Unless he wins on appeal, Trump is now barred from borrowing at New York banks until 2027. This significantly increases the leverage of potential lenders in the Gulf and elsewhere. The Trump Organization cannot function without debt.
The day after last week’s New York court ruling, Trump launched a new line of $399 “Never Surrender High-Top” sneakers. Trump’s new merchandise is gold with a large T engraved on the side. Since they’re available in a limited edition of just 1,000 pairs, Trump clearly won’t make much of a dent in sneaker sales, even though some buyers have paid as much as $9,000 a pair. Nor is his $99 “Victory47” Trump perfume likely to deliver a lot of money. But this is missing the point. Trump’s campaign is inseparable from his merchandising business. The same would be a hundred times truer of his presidency and his party. Last week he proposed that his daughter-in-law, Lara Trump, be the next co-chairwoman of the Republican National Committee.
It is often said that Trump’s biggest incentive to win in November is to keep himself out of prison. In fact, the law would have allowed him to campaign and win from prison, at which point he would presumably try to free himself. Less understood is the boost that another term would give to Trump’s solvency. Last week’s huge fine was based on defrauding lenders by greatly inflating his assets. Where the Trump Building on Wall Street had 63 floors, for example, his officials claimed it had 72. Having failed to do their due diligence, his creditors deserve whatever losses they suffered. The same would be true for the American electorate if they voted to return Trump to power.
edward.luce@ft.com