August 11, 2017--The Art of Trump's Deals

An experienced and successful CEO type might very well have the potential to be an effective president of the United States. Not that we have ever elected that type of business leader. But if an actor (Ronald Reagan) can be a successful president isn't it likely that a Fortune 500 CEO could be even more so?

To many, this was the promise Donald Trump represented--to them he was a big-time businessman whose CEO skills could be effectively transferred to what is required of our best chief executives.

During the campaign Trump boasted that he was a "huge" success and that he wrote the book, literally, on the art of deal making. And as such, he claimed, he would be able to make the same kind of deals for the benefit of the American people.

Here's the problem--

First, Trump was the opposite of a Fortune 500 CEO. His business, which to give him credit in bottom line terms is big, was more a mom-and-pop-and-children operation than anything like Amazon, GM, or General Electric. And we can see how he transferred that small-time way of doing business to the White House when he brought along with him his daughter and son-in-law to serve among his very few trusted advisors.

Then, the kind of deals Trump made were relatively simple transactions. Thus, they did not yield the experience needed to be even a decent president.

Trump, Inc's deals, writ large, are more like those with which we are all familiar--buying a house or apartment. Real estate deals. They did not require any profound negotiation skills and, especially, were not multidimensional nor in any way nuanced or diplomatic.

How does buying, renovating, and operating the (now bankrupt) Trump Taj Mahal Casino in Atlantic City compare with getting Congress to pass healthcare legislation, building an alliance among allies, vying with China about trade, dealing with Russia about what to do in Syria, or confronting North Korea?

With Trump there are no transferable correlates.

The Art of the Deal is largely about the atmospherics and psychology of deal making. How posturing and blustering, bluffing and strategic, even arbitrary walking-out exerts leverage on the other side. There is nothing creative or entrepreneurial about that, nor does it demonstrate or require leadership or complex organizational skills

So the original owner of the Taj Mahal, Resorts International, asks $800 million and Trump counters with a $500 million offer. The Taj people moan at the lowball number but reduce their asking price to, say, $750 million. And so it goes until they mutually reach something like $700 million. Then it's up to the lawyers to draft the contract and for Trump to run around town in search of a money laundering bank to come up with the financing.

Does this in any way sound like what is needed in a president?

Thus, like so much else about Trump, his CEO credentials are inflated and largely fake. And thus we are living with a dangerous mess.