Chris Crucial: Poor Donald Trump
PLUS: No 'No Labels' candidate!
Welcome to Chris Crucial. This is my nightly effort to summarize all the political news you need to know into a single newsletter. Two things to consider: 1) This is going to become a product for only PAID subscribers in the (very) near future and 2) The price for a subscription to this newsletter is going up on April 1. So, if you appreciate and value this content, please consider becoming a paid subscriber today. Right now it’s just $5 a month or $50 a year!
1. Donald Trump’s cash problem: If you read this newsletter regularly, this headline won’t surprise you: “Trump Spurned by 30 Companies as He Seeks Bond in $454 Million Judgment.”
Nor will this lede paragraph:
Donald J. Trump’s lawyers disclosed on Monday that he had failed to secure a roughly half-billion dollar bond in his civil fraud case in New York, raising the prospect that the state could seek to freeze some of his bank accounts and seize some of his marquee properties.
As I have regularly noted ion this space, Trump has a cash flow problem. He has said in the past that he had roughly $400 million in cash. But that is well short of the $454 million he owes the state of New York after being found guilty of repeatedly overvaluing his assets so as to secure more favorable loan terms from banks. (Last week Trump posted a $91.6 million bond to cover the penalty doled out for defaming E. Jean Carroll.)
According to Forbes, as of September 2023, Trump was worth $2.6 billion. Most of that wealth is tied up in the various real estate properties he owns. (Forbes also estimated that Trump had “cash/liquid assets” of $426 million.)
The New York Times says Trump’s team talked to more than two dozen appeals bond companies. But, they rejected Trump’s overtures because he “does not have enough liquidity to obtain the bond. To offer a bond of this size, the companies would require Mr. Trump to pledge more than $550 million in cash, stocks and bonds as collateral — a sum he simply does not have.”
Which brings me back to the HOW Trump can get the money. In a post last month, I laid out three options:
Get a loan. It’s not immediately clear what financial institution would loan Trump several hundred million dollars after he was just found guilty of lying to banks about his wealth but, hey, who knows?
Sell stuff. Trump could sell stocks and the like or — and this would probably hurt him more — a building or three. (Forbes estimated that Trump has $690 million in New York City real estate.)
Raise the money. Trump can’t use money raised for his presidential campaign to pay legal bills and penalties but he CAN use money raised for affiliated super PACs to do so. Last year alone, Trump used $50 million(!) in donations to pay his legal bills.
So, option #1 appears to be off the table. Or at least appears to be a major problem — unless a bank rides to the rescue. And I simply don’t see how Trump could raise $454 million (or anything close to that sum) from small-dollar givers or big-dollar donors.
His supporters make the case that Trump will come into a financial windfall when Truth Social, his social media site, goes public. But, it’s not clear when that will be — and Trump himself appears to be exploring other options, most notably selling Truth Social to Elon Musk.
Which leaves us, presumably, with option #2 — selling stuff. Which, of course, Trump is NOT going to want to do. His properties are image-defining for him; being forced to sell one off to pay a legal penalty would be mortifying for Trump.
We aren’t there yet. Trump is filing a series of appeals aimed at delaying the payment and or lessening it. But, make not mistake: He would NEVER publicly admit he doesn’t have enough money to pay something unless he absolutely had to. Which, it appears, he does.
2. No Labels, no candidate?: No Labels has announced it plans to move forward with an effort to recruit a third party ticket in the 2024 election. But, it doesn’t appear as though anyone wants to be the candidate.
On Monday, former Georgia Republican Lt. Gov. Geoff Duncan took his name out of consideration — after No Labels courtship of him went public last week.
"It was an honor to be approached, and I am grateful to all those who are engaged in good-faith efforts to offer Americans a better choice than the Trump vs. Biden re-match,” said Duncan.
He joins a long list of candidates who have told No Labels, um, no — including Nikki Haley, Georgia Gov. Brian Kemp, former Maryland Gov. Larry Hogan West Virginia Democratic Sen. Joe Manchin.
No Labels has formed a 12-person committee who will vet potential candidates and then make a recommendation to the larger organization. Former Connecticut Sen. Joe Lieberman is one of the co-chairs of that committee.
The group has come under considerable fire from Democrats, who argue that it is functioning as a spoiler in 2024 — potentially making it easier for Donald Trump to get elected.
(I wrote about my struggles to understand the No Labels logic here.)
3. A (Spring) break: It’s spring break at my kids’ school. We are getting away for a few days so posting here will be far lighter than usual. There will be no “Chris Crucial” tomorrow or Wednesday. I will be back Thursday with your regularly-scheduled programming.
Thanks AS ALWAYS for your support. And remember: The price for this newsletter is going up on April 1. Act now to lock in the lowest possible subscription price: $5 a month or $50 for the year.
NOTABLE QUOTABLE
“I informed him that given the crisis at the U.S.’s southern border and our overwhelming debt, President Trump’s idea of turning aid from the U.S. into a no-interest, waivable loan is the most likely path forward." — South Carolina Sen. Lindsey Graham on what he told Ukrainian President Volodymyr Zelensky when the two met Monday.
ONE GOOD CHART
Religious belief was once a pillar of American society. No longer. This Pew chart shows how the vast majority of people believe religion is losing influence in everyday life.
SONG OF THE DAY
Chuck Berry would have been 97 years old today. It’s hard to pick ONE favorite song of his but, for my money, I am going with “Maybelline.”
It made my day perfect when over 30 insurance companies refused to loan Trump that $450 million. They want cash as surety. I got out my tiny violin and played it until I had to get out my tiny hanky to dry the almost tear I shed. Love it!!
Michael Cohen on "Deadline White House" today about Trump selling properties. Lots of things I hadn't considered:
We are talking about a half-billion-dollar bond. He is in the real estate industry. Much of his assets are leveraged. Real estate is not what as some of your other guests have already pointed out. It's not where they want to go. They don't want to go with that because, let's not forget, if he sells the assets, there are also tax consequence points that will be due. He has long-term capital gains, and because it's New York, you also have city and state tax. So you're looking at effectively a 40% taxable rate. Not only does he have that he also has on top of that mortgages attached. So taxes, state taxes, and federal taxes come first, followed by the mortgage, and then whatever is left over would ultimately go to pay off the judgment or to repay the bond. That's why nobody wants it. And he's right, it's effectively impossible.
Now, what does it turn around and tell you, it tells you, it tells you that he's not nearly as rich as he sold himself to the American people that he, even at the trial, at the New York Attorney General trial, he told Judge Engoron that he was worth and had at least $400 million in cash. Well, if that's true, post the 400 million and get the balance, and if it's not true, who knows? Maybe it could be a perjury charge.