Summary of the Article: The Early Business Practices of Donald trump and His father, Fred trump
This article details the early business dealings of Donald Trump and his father, Fred Trump, highlighting a pattern of leveraging government subsidies, political connections, and perhaps questionable practices to build a real estate empire. Here’s a breakdown of the key points:
Fred Trump’s Early Success (Queens & Brooklyn):
Government Subsidies: Fred trump profited significantly from federal funding intended for veteran housing after WWI, inflating costs and securing larger mortgages then justified. He made over $3 million in profit through this.
High Rents & Waste: This led to higher rents for tenants and accusations of wasted federal funds, though it wasn’t illegal at the time.
Family Trust & Tax Avoidance: In the 1950s/60s, Fred Trump used trusts in his children’s names to own land, which the New York Times interpreted as a tax avoidance strategy. Donald Trump was already a millionaire by age 8 due to his father’s business.
Political connections: Fred Trump cultivated close relationships with local politicians, notably New York Mayor Abe Beam, providing notable political funding. Beam’s close friend was also the Trump family lawyer.
Donald Trump’s Entry into Manhattan:
leveraging Father’s Network: Donald Trump entered the Manhattan real estate market in the 1970s, a time of city financial crisis, relying heavily on his father’s established political connections.
Beam Administration Favors: During the Beam administration (1974-1977), Trump secured key progress opportunities, including three bids for land near Penn Station. The bidding process was reportedly steered towards Trump.
Unprecedented Tax Breaks: Mayor Beam granted Trump an unprecedented 40-year tax cut for the Hyatt Hotel development project just before leaving office. This tax break amounted to $349.3 million by 2016. Continued Connections: Officials involved in securing the tax breaks, like Stanley Friedman, later worked for Trump’s lawyer, roy Cohn.
* Success in Manhattan: the Hyatt Hotel’s success paved the way for Trump Tower (completed 1983) and established Donald Trump as a prosperous Manhattan real estate developer.
Overall theme: The article paints a picture of a business built on a foundation of government support, political influence, and potentially exploiting loopholes, rather than purely market-driven success. It suggests that Donald Trump benefited significantly from his father’s established network and practices from a very young age.
