Donald Trump in The Art of the Comeback, by Donald Trump
On Principles & Values:
Feeling cocky & invincible can be destructive
I got a little cocky and, probably, a little bit lazy. I wasn't working as hard, and I wasn't focusing on the basics. I traveled around the world to the spring fashion shows in France.I began to socialize more, probably too much. Frankly, I was bored.
I really felt I could do no wrong. Sort of like a baseball player who keeps hitting home runs or a golfer who keeps winning tournaments--you just get a feeling of invincibility.
Ultimately, this invincible feeling, while positive at times, can be destructive. You let down your guard. You don't work as hard. Then things start to go in the wrong direction. And that's what happened to me--and I never thought it could.
In 1990, the market was so horrendous that prices, for even the best buildings in town, were plummeting. Apartments were being bought at prices you never thought possible. It was a complete disaster.
Source: The Art of the Comeback, by Donald Trump, p. 5-6
Oct 27, 1997
On Tax Reform:
1986 tax laws destroyed incentives retroactively
It was 1986, the peak of the real estate market's boom. Some pundits down in Washington D.C., decided it was time to rein in a few overzealous developers, who, the pols claimed, were unfairly taking advantage of tax breaks and favorable
depreciation schedules. The 1981 tax code was revised and the Tax Equity and Fiscal Responsibility Act of 1986 (TEFRA) was passed, destroying just about any incentive anyone might have for investing in real estate.
And, you may remember, it included a stipulation that the tax laws be applied retroactively. Overnight developers and investors went bust by the thousands. The banks did just as badly. Here's why.
First, TEFRA eviscerated the tax shelters--in place to encourage investment--thereby leaving investors virtually no incentive to put their money into any type of development--including low-and moderate-income housing.
Source: The Art of the Comeback, by Donald Trump, p. 9-10
Oct 27, 1997
On Principles & Values:
Learned about myself, from adversity in hard times
I'm a firm believer in learning from adversity. Often the worst of times can turn to your advantage--my life is a study of that. I learned so much during the tough years. So I decided to write it all down. If you're in trouble, or you're down and out,
I hope you'll be able to glean some of my hard-learned lessons in these pages.My wish is that this book will provide inspiration. I learned a lot about myself during these hard times; I learned about handling pressure. I was able to home in,
buckle down, get back to the basics, and make things work. I worked much harder, I focused, and I got myself out of a box. Don't get me wrong--there were moments of doubt, but I never thought in negative terms. I believe in positive thought and positive
thinking. I learned a lot about loyalty--who was and who wasn't. There were people that I would have guaranteed would have stuck by me who didn't, and, on the other hand, people who I made who, when it came time to help me, didn't lift a finger.
Source: The Art of the Comeback, by Donald Trump, p. xii
Oct 27, 1997
On Tax Reform:
High tax rate encourages investment risk
[In the tax law change of 1986], the upper-income tax rate was lowered from 51% to 32 %. Investing involves risk. With a 51 percent tax, investors might take a chance on a new housing project.
If the project went south, the investor could recapture his losses in the form of a tax break. If an investor is taxed only 32 percent, why bother with the risk?
Source: The Art of the Comeback, by Donald Trump, p. 10
Oct 27, 1997
On Corporations:
Personal bankruptcy is a negotiating tool; I'd never do it
In March of 1990 I told Wall Street I might miss Trump Castle's $43 million principal and interest payment. This announcement reverberated around the world because I had never missed any payment before.
Suddenly bankers--some I'd worked with for a decade--were doubting my ability to make upcoming payments on my other loans. They were right to be skeptical. I wasn't sure myself where the money would be coming from.
The problems at the Castle could have triggered a series of defaults, forcing me into personal bankruptcy. And there was no way Donald Trump was going bankrupt!
I would talk about bankruptcy and I would use that possibility as a tool to negotiate, but I'd never do it. That would end the game.
Source: The Art of the Comeback, by Donald Trump, p. 12
Oct 27, 1997
On Corporations:
We've all been victims of herd mentality on Wall Street
Business was great. So I said, "Let's go. It's time to go public." At the height of the market, we hit. I raised over $2 billion. While my casinos are individually doing very well, casino stocks have been hit very hard. Wall Street has been tough on us.
I find this somewhat unfair, being grouped with a lot of companies that are fundamentally different. The only thing we have in common is that we run casinos. My company, Trump Hotels & Casino Resorts, is incredibly liquid, with four magnificent casinos,
including one in Buffington Harbor, Indiana, right outside of Chicago. To a large extend, we've all been the victims of Wall Street. There can be a bit of a herd mentality there. Once on analyst starts dumping on an industry, often the others follow.
Right now, as I write this chapter, the casino markets have been lousy. They will come back, though. I have tremendous confidence in the future of Atlantic City and my hotels in particular. Time, I believe, will prove me right.
Source: The Art of the Comeback, by Donald Trump, p. 41-3
Oct 27, 1997
On Civil Rights:
Created first club in Palm Beach open to blacks & Jews
[In the early 1990s], I was living happily at Mar-a-Lago with Ivana and the kids. But in actuality, as a house it was far too big. I went through years of legal skirmishes with the town of Palm Beach. I stated that Mar-a-Lago should have always been a
club. A club would have been the maximum use for the property.Ultimately, the town council of Palm Beach approved Mar-a-Lago for use as a private club. They fought me every inch of the way. But right won out.
One of the principal reason that
I had such strong support from the people within Palm Beach was that, unlike the other clubs in town, Mar-a-Lago would be open to all races, colors and creeds. Paul Rampell really pushed this point. The Bath and Tennis Club and the Everglades Club had
no Jewish or black members.
Mar-a-Lago would be open to all, and this appealed to a large group of supporters. It also sparked a tremendous fight by those who wanted to preserve the existing system, a system that, in this day and age, seems archaic.
Source: The Art of the Comeback, by Donald Trump, p. 67-72
Oct 27, 1997
On Environment:
Asbestos got a bad rap from miners & mob-led movement
Asbestos is the greatest fireproofing material ever used, and everybody in the construction industry knows it. It is also 100% safe, once applied. But early on, asbestos got a bad rap because of the fact that miners who were digging asbestos for many
years would often develop asbestosis, and therefore people thought that asbestos was not safe. I'm not saying it's the greatest material to work with. I'm only saying it's the safest material in terms of fire. A huge and concerted effort was made to have
asbestos removed from buildings, causing tremendous dislocation and destruction and creating a new problem: asbestos floating in the air.I believe that the movement against asbestos was led by the mob, because it was often mob-related companies
that would do the asbestos removal. Great pressure was put on politicians, and as usual, the politicians relented. Millions of truckloads of this incredible fireproofing material were taken to special "dump sites" because of this stupid law.
Source: The Art of the Comeback, by Donald Trump, p. 83-4
Oct 27, 1997
On Corporations:
Vulture lawyers look for businesses known to settle cases
Lawyers in general did really bother me. For instance, often a case will be presented to me in which I am being sued for X dollars and a settlement will be offered for substantially less than what my legal fees would be. Depending on the type of case
it is, I will often reject the settlement. When a businessman becomes known as someone who easily settles cases, it creates a very bad precedent.
While it may often be the thing to do, it allows vulture lawyers to watch various companies and see who are and who aren't the "settlers."
The moment someone settles or makes it easy for a particular lawyer, he will inevitably return with another suit a short time later. Also, his scavenger friends who were watching will likewise find reason to sue.
Source: The Art of the Comeback, by Donald Trump, p.103-4
Oct 27, 1997
On Corporations:
Litigation system is abused to force deal negotiations
Litigation has gotten totally out of control. It has actually become an accepted business practice for people to use the court's time, money and energy in order to effect deals, break up deals, and receive money unjustly. I know people who virtually
can't function without starting a lawsuit, thinking that this will give them the upper hand in even the most simple of negotiations.Politicians ought to be ashamed of themselves for perpetuating this ridiculous situation. Court systems have become
backlogged for years with superfluous cases. In New York in particular, a case will often take seven or eight years to actually get to court. This is certainly not the judge's fault, because most of the judges in New York are hardworking, diligent men
and women with brilliant legal minds. The fault lies in a system that is meant to be abused, and which is costing states and the country hundreds of millions of dollars. Perhaps more important, its creating centuries worth of delay.
Source: The Art of the Comeback, by Donald Trump, p.104
Oct 27, 1997
On Government Reform:
Loser pays all costs, and over-litigiousness stops
Litigation in the United States has gotten totally out of control. The saddest part of all is that this problem should be easy to solve, and everybody, including the American Bar Association, knows exactly what I'm talking about.
The simple answer is this: The loser pays all costs related to the case including, but in no way limited to, the legal fees of the winning party.If this legislation were enacted, it is my opinion that you would see our courthouses become totally
efficient again, in that the caseload would drop by perhaps 70 to 80 percent. The judges and their staffs, who now work endlessly to catch up with needless motions made by nonsense lawyers, would be free to concentrate on the real cases,
the ones that deserve to go to court. Everyone knows I'm right, but no politician wants to take on the wrath of the lawyers' lobbying groups. Somebody should--because that person could be assured of being in office forever.
Source: The Art of the Comeback, by Donald Trump, p.104-5
Oct 27, 1997
On Civil Rights:
Women are far stronger than men; don't believe "weaker sex"
I grew up in a very normal family. I was always of the opinion that aggression, sex drive, and everything that goes along with it was on the man's part of the table, not the woman's. As I grew older and witnessed life firsthand from a front-row seat at
the great clubs, social events, and parties of the world--I have seen just about everything--I began to realize that women are far stronger than men. Their sex drive makes us look like babies. Some women try to portray themselves as being of the weaker
sex, but don't believe it for a minute. Women have one of the great acts of all time. The smart ones act very feminine and needy, but inside they are real killers. The person who came up with the expression "the weaker sex" was either very naive
or had to be kidding. I have seen women manipulate men with just a twitch of their eye--or perhaps another body part. I have seen some of the roughest, toughest guys on earth, and yet they're afraid of their 120 pound girlfriends or wives.
Source: The Art of the Comeback, by Donald Trump, p.116-8
Oct 27, 1997
On Families & Children:
I seem to bring out either the best or worst in women
I don't know why, but I seem to bring out either the best or worst in women. Even Katarina Witt, the great Olympic figure-skating champion, caused me some angst. Because I built and ran the Wollman Skating Rink in Central Park, I became something of a
factor in the ice-skating business. One day I received a phone call from Katarina asking if she could come to my office to say hello. Everything went well; Katarina invited me to see her opening-night performance at Madison Square Garden.
Katarina asked me what I thought of the evening. I told her that, while I liked her skating, I thought the music she skated to was horrible. "I know you want to be artistic," I said, "but you really ought to choose music that's more mainstream, something
people will enjoy." Katarina was not pleased with my comments and I could see at a glance that steely German temperament. After that, every article written about Katarina Witt included claims that I had asked her out and she had turned me down.
Source: The Art of the Comeback, by Donald Trump, p.126-7
Oct 27, 1997
On Environment:
Humiliated NYC Mayor by finishing ice rink on time on budget
Ed Koch may have respected me, but he sure didn't like me. Our relationship went south for one reason: the Wollman Rink in Central Park. You may remember the tale. Local government had been trying for 7 years--and $20 million--to get that thing rebuilt.
In 1986, I stepped in, and--with $2 million, or 10% of the city's dollars--New Yorkers were gliding across the ice four months later. Koch was humiliated. He took it personally. Rather than compliment me on saving the Wollman Rink, one of the great
bureaucratic disasters in New York City history, Ed Koch tried to make light of my triumph by saying that the city could have done the same thing, that is, build the rink in four months rather than in seven years, if only it were not forced to go
through the bureaucratic red tape. This was nonsense, and everyone knew it, but nevertheless, Ed's feeling toward me came out loud and clear. He felt I'd shown him up and from that point forward my relationship with Ed Koch was the pits.
Source: The Art of the Comeback, by Donald Trump, p.153
Oct 27, 1997
On Environment:
Bureaucratic land use reviews make projects unbuildable
[In planning an NYC project] I identified my bloodiest battle: the Uniform Land Use Review Process. ULURP is an impossible situation. All applicants are approved by the Board of Estimate, composed of the 5 borough presidents, the city council president,
and the comptroller. In order to move from one level to the next in the approval process--from the community board to the City Planning Commission & so on--the applicant is forced to negotiate blind, clueless as to the opponent's demands. It's a circus.
And it often produces approval packages that are essentially unbuildable. Koch decided he'd change all this. I was optimistic--until I learned of his plan. In his infinite wisdom, Koch created yet another bureaucratic entity, the Charter Revision
Commission. It was a complete disaster. The process became more cumbersome, expensive, and time-consuming than ever. I was appalled. Nothing, I had thought, could have made this process more inefficient, more ill-conceived, but I was wrong.
Source: The Art of the Comeback, by Donald Trump, p.157
Oct 27, 1997
On Homeland Security:
1994 Veteran's parade: Such high-quality people led military
[After a poorly-attended Veteran's Day parade], a group of veterans wanted to do it differently the following year. Those veterans asked me to lead it as Grand Marshal--essentially they wanted my stamp of approval.
They needed dollars. They knew I could raise lots of money and get additional donors. They also knew I would attract a lot of press.
I agreed. I thought it would be fun, and I knew it was important. Mayor Giuliani was pledging the support of the city. I put up money; others matched it.
I always knew there was a military out there, but I had no idea such high quality people led it. This is something I got to know, and know very well, over the next few months.
Source: The Art of the Comeback, by Donald Trump, p.168-72
Oct 27, 1997
On Principles & Values:
I'm a clean-hands freak; and dislike shaking hands
One of the curses of American society is the simple act of shaking hands, and the more successful and famous one becomes, the worse this terrible custom seems to get. I happen to be a clean-hands freak.
I feel much better after I thoroughly wash my hands, which I do as often as possible. Recent medical reports have come out saying that colds and various other ailments are spread through the act of shaking hands.
I have no doubt about this.To me the only good thing about the act of shaking hands prior to eating is that I tend to eat less.
For example, there is no way, after shaking someone's hand, that I would eat bread. Even walking down the street, as people rush up to shake my hand, I often wonder to myself, why? Why risk catching a cold?
Source: The Art of the Comeback, by Donald Trump, p.175
Oct 27, 1997
On Principles & Values:
Prefers short, formal bows to shaking hands
[I dislike] shaking hands. The Japanese have it right. They stand slightly apart and do a quick, formal and very beautiful bow in order to acknowledge each other's presence. This is an ancient act, and was probably originated eons ago by
someone like me--a germ freak. Whoever formalized this greeting was very smart, and far beyond his time. I wish we would develop a similar greeting custom in America.
In fact, I've often thought of taking out a series of newspaper ads encouraging the abolishment of the handshake. At the very least, people would realize why I hate to shake hands and not take it personally. In any event, if any of you folks
reading this book really like me, please approach me at any time, in a restaurant or elsewhere, and don't stick out your hand but simply bow. I will bow back and greatly appreciate the thought.
Source: The Art of the Comeback, by Donald Trump, p.175-6
Oct 27, 1997
On Principles & Values:
I'm too honest & too controversial to be a politician
When I think of the media, I often think of politics--the two go hand in hand. For example, my experience with The Village Voice has been terrible. They have so many preconceived notions about me, all of which are politically motivated.
However, unlike the media, politics is a business of relevance. People have always asked me if I'll ever be involved in politics. It seems every so often there's some unfounded rumor that I'm considering seeking office--sometimes even the presidency!
The problem is, I think I'm too honest, and perhaps too controversial, to be a politician. I always say it like it is, and I'm not sure that a politician can do that, although
I might just be able to get away with it because people tend to like me. Honesty causes controversy, and therefore, despite all the polls that say I should run, I would probably not be a very successful politician.
Source: The Art of the Comeback, by Donald Trump, p.186
Oct 27, 1997
On Principles & Values:
For bad investment advice, you get blame; if good, no credit
Perhaps the question I am most often asked is where, when, and how should someone invest their money. My answer is usually a very quick and terse "good luck." The reason for this is simple.
If I recommend an investment and it turns out badly, it will be my fault. I will always be blamed. If on the other hand, the investment turns out to be brilliant, earning tremendous amounts of money, people are quick to forget that it was
I who made the recommendation in the first place. This unfortunately, is human nature. It's how the game is played. If it's bad, you take the blame.
If it's good, you get no credit. As I tell my young employees all the time, "Welcome to life."
Source: The Art of the Comeback, by Donald Trump, p.187-8
Oct 27, 1997
On Technology:
Computer industry is overheated
Today the computer and technology industries are hot, but that doesn't mean that they won't cool off quickly. It just seems to me that they are overheated, and competition is strong. When I read about all of the different companies producing new
computers by the thousands, it seems like a very tough business to me. But then, I don't even know how to turn on a computer. Therefore, I'm not a natural investor in technology. If you are drawn to this sector, at least approach it with an advisor.
Source: The Art of the Comeback, by Donald Trump, p.191
Oct 27, 1997
On Principles & Values:
People who inherit don't know how to earn back losses
People who inherit fortunes are very interesting to me. I see it down in Palm Beach all the time. I respect those who realize their limitations and don't want to take chances. They got lucky. I call them members of the lucky sperm club--they inherited
wealth. I've noticed that the lucky ones are usually very cheap. They never pick up the tab, live very frugally, and are seldom the life of the party. They know that if they lose their money, they don't have the ability to make it back. The more unlucky
ones are those who inherit wealth and decide that they are going to be the next great success, but they don't have the talent. Their money goes fast. It's not a pretty picture. I have seen it often, and seldom is there a sadder scene than a family that
starts out with wealth and ends up fighting just to survive.In order to come back, you need confidence. It's hard to think of yourself as a winner when you go through the family fortune in a few years and never sample even a morsel of success.
Source: The Art of the Comeback, by Donald Trump, p.222-3
Oct 27, 1997
On Principles & Values:
Measure success in happiness, not just in dollars
The courage to make a switch, even if it seems like a ridiculous one, is also an ingredient of success. There are times when a change in life's course does seem strange, but it may well be necessary in order to create success. And success can't be
measured just in dollars and cents; it has to be measured in happiness, too. I know many rich people who are extremely unhappy and really should be doing something else. Going against the tide is often a very clever thing to do. While it can involve
taking risks, and while I cannot say that it's a primary factor for success, often going in the opposite direction can lead to the highest level of achievement. When I decided to keep 40 Wall Street as an office building, I was very much going against
the tide. Everyone in lower Manhattan was converting their buildings to apartments--and with good reason. I decided that rather than going the safe route, the route that everybody else was taking, I would head in the exact opposite direction.
Source: The Art of the Comeback, by Donald Trump, p.225-6
Oct 27, 1997
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