The 1 Easy Way Donald Trump Could Have Been Even Richer: Doing Nothing

As “really rich” as Don­ald Trump is today, he might have been even rich­er if, in­stead of dab­bling in sky­scrapers and casi­nos, he’d simply taken his eight-fig­ure in­her­it­ance dec­ades ago and sunk it in­to the stock mar­ket.

Had the celebrity busi­ness­man and Re­pub­lic­an pres­id­en­tial can­did­ate in­ves­ted his even­tu­al share of his fath­er’s real-es­tate com­pany in­to a mu­tu­al fund of S&P 500 stocks in 1974, it would be worth nearly $3 bil­lion today, thanks to the mar­ket’s per­form­ance over the past four dec­ades. If he’d in­ves­ted the $200 mil­lion that For­bes magazine de­term­ined he was worth in 1982 in­to that in­dex fund, it would have grown to more than $8 bil­lion today.

Even the smal­ler fig­ure ex­ceeds the lower range of his pos­sible net worth as re­por­ted to the Fed­er­al Elec­tion Com­mis­sion, while the lar­ger num­ber ex­ceeds by bil­lions re­cent es­tim­ates of Trump’s worth by fin­an­cial pub­lic­a­tions. And it would have come without the high-drama, roller-coast­er ca­reer that has in­cluded four cor­por­ate bank­ruptcies.

That a purely un­man­aged in­dex fund’s re­turn could out­per­form Trump’s hands-on wheel­ing and deal­ing calls in­to ques­tion one of Trump’s chief selling points on the cam­paign trail: his busi­ness acu­men.

Among those drop­ping dried corn ker­nels in­to Trump’s jar at the Iowa State Fair last month, many cited Trump’s busi­ness ex­per­i­ence as a top reas­on he’d make a good pres­id­ent—a no­tion that sup­port­ers in New Hamp­shire also share. “He’s a good busi­ness­man,” said Bed­ford, New Hamp­shire, re­tir­ee Frank Savino. “He cre­ates a lot of jobs.”

Trump’s cam­paign did not re­spond to Na­tion­al Journ­al quer­ies about his story. Trump him­self fre­quently speaks of his great wealth—he claims it ex­ceeds $10 bil­lion—as proof of his skill as a ne­go­ti­at­or, which he says cur­rent Amer­ic­an of­fi­cials lack in their deal­ings with oth­er coun­tries.

“Who would you rather have ne­go­ti­at­ing against China, against Ir­an?” he asked a Dubuque, Iowa, audi­ence last week. “Jeb Bush, Hil­lary Clin­ton, or Trump?”

***

“I’m proud of my net worth,” Trump said dur­ing his June an­nounce­ment speech. “I’ve done an amaz­ing job.”

Trump has spent dec­ades mak­ing sure that the pub­lic be­lieves he’s ex­tremely rich. In 1982, as For­bes magazine put to­geth­er the first of its an­nu­al list of the wealth­i­est Amer­ic­ans, Trump ar­gued to ed­it­ors that he was worth $400 mil­lion, not the $200 mil­lion the magazine as­signed him. It was only the first of many such lob­by­ing ef­forts.

“Every year, Trump shares a lot of in­form­a­tion with us that helps us get to the fig­ures we pub­lish. But he also con­sist­ently pushes for a high­er net worth—es­pe­cially when it comes to the value of his per­son­al brand,” For­bes re­port­er Erin Carlyle wrote this June, ex­plain­ing the magazine’s as­sess­ment that Trump was worth $4.1 bil­lion, less than half of his claimed net worth. A sub­sequent re­view by Bloomberg found he was worth $2.9 bil­lion.

While many Trump sup­port­ers be­lieve he is a self-made man, it was ac­tu­ally his fath­er, Fred Trump, who built the real-es­tate em­pire that Don­ald Trump took over in 1974. It was worth about $200 mil­lion at the time, which Trump and his four sib­lings ul­ti­mately in­her­ited after en­joy­ing siz­able trust funds for years.

(Co­in­cid­ent­ally, there was a self-made busi­ness­man who was also worth about $40 mil­lion in 1974: War­ren Buf­fett. Had Trump al­lowed Buf­fett to man­age his for­tune, too, Trump might also be worth what Buf­fett is today: about $67 bil­lion—or about 22 times bet­ter than what the stock mar­ket would have pro­duced.)

Be­cause Trump’s busi­nesses are privately held con­cerns, they’re not re­quired to file Se­cur­it­ies and Ex­change Com­mis­sion re­ports, as pub­licly traded com­pan­ies must do. Even the fin­an­cial dis­clos­ure Trump had to file after start­ing his pres­id­en­tial cam­paign of­fers only lim­ited guid­ance be­cause it asks for val­ues in broad ranges, with a top cat­egory of “over $50 mil­lion.”

A Na­tion­al Journ­al re­view of that 92-page doc­u­ment found as­sets total­ing at least $1.37 bil­lion and li­ab­il­it­ies total­ing at least $265 mil­lion. But Trump claims 22 as­sets he says are worth more than $50 mil­lion each and four loans also ex­ceed­ing $50 mil­lion. Which means that based solely on that doc­u­ment, Trump could the­or­et­ic­ally be worth $100 bil­lion—or be $100 bil­lion in debt.

Per­haps the most deeply re­searched ac­count of his wealth is a dec­ade old: the book TrumpN­a­tion, by former New York Times journ­al­ist Tim O’Bri­en, who found three sources close to Trump who es­tim­ated that he was worth between $150 mil­lion and $250 mil­lion. (That same year, Trump was claim­ing a net worth of $6 bil­lion, and For­bes found a value of $2.6 bil­lion.)

Trump’s re­sponse? To ac­cuse his as­so­ci­ates who gave O’Bri­en that es­tim­ate of hav­ing obese wives. “You can go ahead and speak to guys who have 400-pound wives at home who are jeal­ous of me, but the guys who really know me know I’m a great build­er,” he told O’Bri­en.

Trump wound up su­ing O’Bri­en for de­fam­a­tion, claim­ing his book had dam­aged his busi­ness. The suit was even­tu­ally dis­missed, but not be­fore Trump sat for a de­pos­ition in which he ad­mit­ted that he routinely ex­ag­ger­ated the val­ues of his prop­er­ties.

“I think every­body does,” he said in the de­pos­ition. “Who wouldn’t?”

Trump said his es­tim­ate of his net worth on any giv­en day was based on a lot of dif­fer­ent factors—in­clud­ing his mood. “My net worth fluc­tu­ates, and it goes up and down with the mar­kets and with at­ti­tudes and with feel­ings, even my own feel­ings,” Trump told O’Bri­en’s law­yer. “I would say it’s my gen­er­al at­ti­tude at the time that the ques­tion may be asked. And as I say, it var­ies.”

(This sum­mer, when Trump’s cam­paign is­sued a press re­lease that stated, in all cap­it­al let­ters, that Trump was worth TEN BIL­LION DOL­LARS, O’Bri­en wrote a column for Bloomberg View that an­nounced that he, too, was worth $10 bil­lion, based on his own feel­ings.)

That 2007 de­pos­ition also re­vealed that in 2005, two sep­ar­ate banks had as­sessed Trump’s as­sets and li­ab­il­it­ies be­fore agree­ing to lend him money. One, North Fork Bank, de­cided he was worth $1.2 bil­lion, while Deutsche Bank found he was worth no more than $788 mil­lion.

***

Wheth­er Trump is ac­tu­ally worth $4 bil­lion or $1 bil­lion or merely hun­dreds of mil­lions likely makes little dif­fer­ence to the typ­ic­al voter, who in any of those cases can claim but a tiny frac­tion of that fin­an­cial where­with­al. But the dis­tinc­tion could af­fect Trump’s will­ing­ness to spend his own money on his pres­id­en­tial race—par­tic­u­larly if it’s as a third-party can­did­ate with little like­li­hood of suc­cess.

Trump wound up spend­ing $1.4 mil­lion on his cam­paign through the end of June, all but $92,000 of which was his own money. He has con­tin­ued hir­ing staff and fly­ing to events on his per­son­al 757 jet­liner—which burns $10,000 of fuel every hour it’s in the air. It’s un­clear how many ac­tu­al con­tri­bu­tions are now com­ing to the cam­paign or wheth­er Trump will so­li­cit big dona­tions to a pro-Trump su­per PAC. In speeches so far, he has told audi­ences that he doesn’t want big donors be­cause they will then want fa­vors in re­turn should he win. “I don’t need any­body’s money. It’s nice. I don’t need any­body’s money. I’m us­ing my own money. I’m not us­ing the lob­by­ists. I’m not us­ing donors. I don’t care. I’m really rich,” Trump said in his Ju­ly an­nounce­ment speech.

But should Trump want to pay for a ser­i­ous pres­id­en­tial run just at the time when a cam­paign must shift in­to a high­er gear and cost dra­mat­ic­ally more, it could quickly eat in­to his ready cash.

Ac­cord­ing to Trump’s fin­an­cial-dis­clos­ure state­ment, he has no more than $63 mil­lion in cash, money-mar­ket ac­counts, or sim­il­ar hold­ings, and as little as $13.1 mil­lion. He also has as much as $169 mil­lion and as little as $65 mil­lion in stocks, bonds, and sim­il­ar in­stru­ments. Everything else is tied up in real es­tate or air­craft, ac­cord­ing to the dis­clos­ure.

So while Trump said last month he’s ready to spend $1 bil­lion on his cam­paign—“If ne­ces­sary, I will spend it, yes”—one GOP con­sult­ant is not buy­ing it.

“From where?” wondered Flor­ida’s Rick Wilson, a fre­quent Trump crit­ic. “I will be­lieve it when I see it. That’s the bull­shit call of this cam­paign: Is he really go­ing to spend a $100 mil­lion?”