A candidate’s policy positions are a very important part of deciding whether or not to vote for them. To some people the policy positions are the only important issue. On the other side some people take the view that the only thing that matters is a candidate’s background and qualifications. Sometimes looking at a candidate’s net worth can give some insight into both of these things. How did the candidate make their money? Is that relevant to the Presidency? How might the candidate’s self-interest impact their policy positions? There’s always some distance between what a candidate says they believe and how they actually govern. You can often judge their self-interest from their net worth and background. From there you might be able to get some insight at what that distance will be.
Donald Trump was born the son of Fred Trump a successful real estate developer and millionaire. He has amassed a substantial amount of wealth over his 50+ year business career. His business pursuits include real-estate, stock market investments, beauty pageants, and sports. Trump has always been exceedingly outspoken and has also had an eye for branding himself when possible. This has given him a celebrity status which he later amplified with the reality tv show, the apprentice.
Donald Trump’s Net Worth
- Age: 69
- Occupation: Real Estate Developer / Television Personality
- Most Money Made In: Real Estate
- Estimated Net Worth as of 2015: 4 Billion (Forbes)
There are three lessons to learn from Donald Trump.
First, it helps to start with a great deal of money. Much of Trump’s wealth comes from his father, Fred Trump. However, Donald Trump has proven to be a good manager of legacy his father gave him. Trump holds a random set of diversified stock investments, which passively passively held alone would have made Donald Trump a very rich man.
Second, is to keep an eye on the downside. Trump holds his real estate investments and licensing deals through a dizzying array of limited liability companies and partnerships. These are largely designed to keep the overall organization safe from a problem at each individual holding. Trump has had four businesses go bankrupt. These didn’t threaten his overall wealth.
Third, be frugal in relation to your means. A self-financed presidential run could spend through even a billionaire’s money fast. Yet Trump has managed to put himself on top of the polls spending a fraction of what other candidates have, in part by using his celebrity and pension for no-filter comments to generate free media attention. In fact, it is rumored that Trump’s celebrity status is at times so powerful that owners of media companies such as FOX New’s Roger Ailes fear angering Trump due to the very high ratings his appearances bring.
Donald Trump’s Net Worth is given by his financial disclosure. His personal financial disclosure was taken from the Center for Responsive politics webpage: opensecrets.org. The disclosure itself is quite interesting. Donald Trump owns all sorts of asset classes. Most of his obvious wealth is in real estate. However, this is deceptive. Some of the assets given in the disclosure have a very low carrying value but generate high amounts of income and will probably do so in the future. These assets are licensing deals and are fairly worth more than they are carried for.
It goes without saying that Trump’s incentives are mostly aligned with the very rich. For example, Donald Trump uses leverage in the form of mortgages on his real estate to increase his returns. Here is an example of a way his wealth might incentivize him to act. Additional deficit reduction would likely drive interest rates lower (benefitting Trump) as a smaller supply of bonds were competed for by the same supply of investors. While Trump’s support for true policies to equalize wealth inequality is speculative at this point, his interests are clearly aligned with America’s 1%.
For more on our series of politicians and their net worth check out: