The Federalist - Monday February 29, 2016
by David Marcus
In Friday’s Republican primary debate, frontrunner Donald Trump was attacked for his leadership of Trump University. The organization, eventually renamed Trump Entrepreneur Initiative (more on that later), offered classes in real estate development. There are currently three lawsuits underway alleging fraud and violations of education law. Whether he wins or loses in court (he has promised he will win), the Trump University story undermines the most essential elements of Trump’s claims that he is qualified to be president.
There are three basic legs to Trump’s campaign stool. First, that he is sincere. He claims that, unlike other politicians, he never says anything he doesn’t mean and won’t be cowed by political correctness. Second, he claims he is great manager who will bring in the best people to run the government. Sure, he lacks political experience, but his top men will make up for that. Finally, he says he gets results. Trump points to the great success of his multi-billion-dollar company as proof he can get these done.
Whether or not Trump or Trump University broke the law, the facts of the case put these Trump claims in serious question. He has admitted in court filings that he lied about key elements of the school. He hired people with little experience or expertise to run it. Far from being a great success, Trump University is now all but defunct. So what happened?
What Was Trump University?
To understand what Trump University was, it is important to understand what it wasn’t—namely, a university. According a lawsuit filed by New York State Attorney General Eric Schneiderman in 2013, the state informed Trump University when it opened in 2005 that it was breaking the law by calling itself a university. It took five years for the name to change, all the while, according to Schneiderman, it operated illegally as a non-accredited university.
Trump University did not offer any degrees, or any rounded curriculum. What it did offer was a series of educational products, priced as high as $35,000, which would teach students how to reap big profits in real estate. At the lowest level it offered seminars, like the ones we hear ads for on the radio, promising to teach investors how to flip property. At those seminars, prospective students would be upsold pricier and supposedly more valuable classes.
In a telling blog post from 2008, Seth Gitell describes attending one of these seminars. It is well worth reading, and describes the familiar atmosphere of a multi-level-marketing scheme aimed at people looking to get rich quick. Gitell recounts the two-hour presentation by a Trump employee “playing on fears and hopes” in a manner that reminded him of Alec Baldwin’s character in “Glengarry Glen Ross.”
This account fits the stories of Trump University “victims” portrayed in a series of ads from American Future Fund, an anti-Trump PAC. Former students claim they were tricked, swindled by slick, silver-tongued snake oil salesmen. Some faced serious financial hardship after doling out tens of thousands of dollars for their real estate education. Along with New York State, they are suing Trump for misrepresenting the value of a Trump University education.
Trump Lied, People Cried
One important defense of Trump University is that no educational institution, whether accredited or not, can guarantee the future financial success of its students. Plenty of baristas on the Lower East Side owe much more than $30,000 for their masters of fine arts degrees from New York University. But NYU does make some promises to these arts students that they are expected to live up to. They promise students will learn from top professionals in their fields, for example. They do, in fact provide that.
The crux of the claim that Trump misled prospective students stems from similar promises. In promotional materials for Trump University, he claimed he would hand-pick top professionals in the field of real estate to instruct students. According to New York State’s lawsuit, that never happened. In court filings Trump himself has admitted as much, stating that while he was involved in creating Trump University, once it was up and running he little or nothing to do with it.
For his supporters, the Trump train is the straight-talk express. Not beholden to special interests, Trump can tell it like it is. In this case, Trump has admitted he was dishonest about his role at Trump University. This may not be enough for his former students to recoup monetary damages, but it should be enough to damage his image of being forthright and forthcoming.
Any lie hurts a politician, but this lie in particular should worry Trump voters. He was promising these students that their best interest and education was at the heart of Trump University, and that he would personally see they received a valuable product. This is very close to the claim he is making to the American people, that as president he will focus on voters’ interests above all else.
Presumably Trump meant it when he said he would hand-pick only the best teachers, but then something happened—perhaps he got bored, or distracted by something else. He allowed others to make those decisions. That is worrisome, considering that Trump as president would be responsible for myriad appointments and nominations, including those of Supreme Court justices.
Trump Hired Losers and Got Losing Results
According to New York State’s lawsuit, Trump University “lacked substantiation for the claims that their instructors and mentors were successful real estate entrepreneurs. Not a single one was ‘handpicked’ by Donald Trump. Many came to Trump University from jobs having little to do with real estate investments, and some came to Trump University shortly after their real estate investing caused them to go into bankruptcy.” Assuming Trump was sincere in his desire that students would learn only from the best, the individuals he put in charge of selecting instructors clearly did a horrible job.
This matters because Trump counters attacks on his lack of political experience with a promise that he will bring in great people to turn the country around. If these are the kinds of great people Trump brings in to make important decisions on his behalf, why should we believe his government hires will fare better? He wanted, and promised, to deliver the best instructors. He failed.
Part of Trump’s defense in the lawsuits is that participants in Trump University’s seminars gave it a 98 percent approval rating in a questionnaire provided afterwards. Importantly, the seminars were only the gateway to the “university.” It was at the seminars that more expensive classes were sold. Trump has offered no data about the level of satisfaction from participants in these costlier classes. Many of them are now suing him.
But let’s assume for the sake of argument that these are just disgruntled former students whose failures are their own, not Trump University’s. Even in that case, the enterprise is nothing short of a disaster. The school is essentially defunct and disgraced. While it’s possible Trump and his employees made a good deal of money from students, that was not Trump’s stated purpose. His stated purpose was to create an institution that would help people. Now that institution is in ruins. Sad.
This Is a Pattern With Trump
When things go badly for Trump or his businesses, his standard answer is that he was not involved. He didn’t know that the mafia owned the concrete company he used in New York. He didn’t know that subcontractors on Trump Tower were using and mistreating illegal Polish immigrants. And he didn’t know what was going on with Trump University. He tells us his company is very big and he can’t possibly be responsible for everything it does.
It is true that Trump’s company is very big, but it’s not as big as the United States of America, which he now seeks to lead. Trump reminded us over the weekend that he attended an Ivy League college, but it was a president without a college degree, Harry S. Truman, who said “the buck stops here.” Throughout his career, again and again Trump has shown that for him, the only place the buck stops is in his pocket.
Trump says he will win these lawsuits. He might. But that isn’t really the issue. For a man whose entire candidacy is based upon his brilliance as a businessman, the debacle that was Trump University is a tough stain to wash out.
Trump, who warned us that Ted Cruz might face lawsuits from Democrats (or Trump) over his eligibility to run, will himself testify in his own defense during this cycle. Republican voters, especially those considering supporting Trump, must ask themselves if Trump University was a blip in an otherwise brilliant career or a harbinger of presidential mismanagement.
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