BOB GARFIELD From WNYC in New York this is On The Media. Brooke Gladstone is out this week, I'm Bob Garfield.

[MUSIC UP & UNDER]

BOB GARFIELD This week in The New York Times, another bombshell report on President Trump's financial house of cards. A decade long period of crushing losses and a tax write off of a staggering one billion dollars.

[CLIP]

MALE CORRESPONDENT Their findings are eye popping, stunning. There's a lot of different adjectives you can use. [END CLIP]

BOB GARFIELD Reporters, Russ Beuttner and Susanne Craig, poured over transcripts of Trump's taxes from 1985 to 1994 and found that he had quote 'lost more money than nearly every other individual American taxpayer.'

[CLIP]

Susanne Craig Every year that we looked at, he lost money. It's unbelievable. We would have thought at least in one of the years that we saw, maybe the year he wrote The Art of the Deal, he would have made money. He didn't, he was just bleeding money. [END CLIP]

BOB GARFIELD This from the swashbuckling dealmaker who had famously become a fixture on the Forbes 400 list of wealthiest Americans–very famously.

[MONTAGE OF CLIPS]

FEMALE CORRESPONDENT He's young, he has Robert Redford good looks. He's conservative and he's rich. I'm talking about Larry King's guest Donald Trump.  

MALE CORRESPONDENT Just has enough money to give everyone in the audience tonight a million dollars. [END CLIP]

BOB GARFIELD But if his business failures and his debts were so immense, how did he get on the Forbes 400 list to begin with? The answer is by being Donald Trump.

[CLIP]

DONALD TRUMP What I think you might want to do is at some point, maybe after that, before you write your little article, maybe you want to call me again and sit down because I'd like to discuss a couple of things. [END CLIP]

BOB GARFIELD That was Trump in 1982 on the phone with Forbes reporter Jonathan Greenberg whose unenviable task was to evaluate Trump's claims of fabulous riches. He botched the job. But in fairness, he was depending heavily on an unreliable source.

JONATHAN GREENBERG The unreliable source was Donald Trump.

BOB GARFIELD Who wanted the world to see not a house of cards but a gilded palace. And thus commenced decades of lies, threats, lawsuits and a bizarre co-dependence with the media. Now a freelance journalist, publisher and novelist, Greenberg was present at creation. The err lie, the origin myth upon which a 37 year long con was built. The young developer Greenberg says understood the pricelessness of validation from the People magazine of capitalism.

JONATHAN GREENBERG It became his obsession to lobby the reporters of The Forbes 400 And Malcolm Forbes himself.

BOB GARFIELD In that first year you settled on a figure for Donald Trump's net worth at that time, what was it?

JONATHAN GREENBERG One hundred million dollars. That was the cutoff to be on the list.

BOB GARFIELD But with some distance, you've been able to ascertain what his actual net worth was at that time.

JONATHAN GREENBERG Distance and time. It was under five million dollars.

BOB GARFIELD He claimed, in those days, that he was in control of what had been his father's fortune. And that wasn't true at all.

JONATHAN GREENBERG That's true. That was one of the big lies and we didn't find out until his father had died. And yet of course everything comes out in time. The other lie was how many apartments they owned. They actually never owned more than 10,000 apartments. But he inflated that figure. And most importantly in [inaudible] to this, what we see in the New York Times, was that he inflated his cash flow on the buildings. And that was his M.O. What Trump is very good at is finding out what he takes to deceive and then promoting that deception in a way that will be very hard to disprove.

BOB GARFIELD In 1982, you gave him a hundred million dollars. In '83, Hhe got a raise to 200 million in the Forbes list and then the next year, 1984, you get a call from the Trump Organization. The caller tells you he's a V.P. and he has some juicy info. What's the info?

JONATHAN GREENBERG Well the call was actually, it was my annual interview with Donald Trump and his secretary Norma Foerderer said that I'm not going to meet Trump in person this year, the V.P. of finance John Barron would schedule a call with me and give me all the information I needed.

[CLIP].

JONATHAN GREENBERG Ok, what's your first name?

DONALD TRUMP AS JOHN BARRON John. [END CLIP]

JONATHAN GREENBERG So I picked up the phone and it was John Barron.

[CLIP]

DONALD TRUMP AS JOHN BARRON And I'd like to talk to you off the record if I can, just to make your thing easier.

JONATHAN GREENBERG Ok, sure. Yeah that's fine. [END CLIP]

JONATHAN GREENBERG Answering all the questions I had about Trump's holdings and his net worth and all the success that he had had as well as his relationship with his father .

BOB GARFIELD And his claim as to the 200 million figure from the year before?

JONATHAN GREENBERG Oh he said that we were way low. You know, that he was worth many times the amount we had had in the past and he proved it by going through building after project after project and speaking of how much money these projects were turning off for Donald Trump.

BOB GARFIELD In fact as we now know John Barron was actually Trump himself lying about his identity to lie about his balance sheet. What number was he pushing and what did Forbes end up going with?

JONATHAN GREENBERG He was pushing $2 billion. He was saying that he was worth more than any other person in real estate. That he never signed personally on he is debt. We ended up going with $600 million. And we took Trump's father off the list because one of the things John Barron told me is that Trump had consolidated all his father's assets in his name.

[CLIP]

JONATHAN GREENBERG Are you saying that, perhaps for tax purposes, the ownership has been transferred to Donald Trump?

DONALD TRUMP AS JOHN BARRON Correct. That's correct.

JONATHAN GREENBERG Ok. And would you say, you know, an excess of 90 percent of ownership probably?

DONALD TRUMP AS JOHN BARRON I would say an excess of 90--in fact, well relatively closer to even the ultimate. But it's a excess of 90 percent yeah. [END CLIP]

JONATHAN GREENBERG So instead of splitting 200 million or half the value of the estate between one and the other, we gave all of the value to Donald Trump.

BOB GARFIELD Yet if the Times report is correct, he actually at that time had a negative net worth. He was more than $50 million in debt, which, you know, if I understand this correctly Jonathan would have made him literally one of the poorest men in America.

JONATHAN GREENBERG That's true. He was overextended. He overpaid for his properties and his construction and he was having enormous tax losses based upon the the debt service of the buildings. Because interest rates were very high during that period.

BOB GARFIELD Now I have to ask you, the fact that this employee, Trump secretary set you up with, John Barron, had the same voice as Trump might've been a red flag. And also, didn't most mega rich people in your experience actually want not to appear on the Forbes list. Wasn't the whole lobbying thing strange in itself?

JONATHAN GREENBERG The editors looked at me, of The Washington Post, when I first played the tape for them before my big story in The Post last year. And they looked at me like, 'um, are you an idiot?' When they heard the tape it sounds exactly like Donald Trump. Nobody could anticipate something that nobody had ever done before which is talking to a national media outlet, pretending to be somebody else using your own voice. His outrageous behavior is off the charts of what anyone else would do. In terms of other people, there was a damned if you do damned if you don't approach to it. Which means that if you're off the list people want to know, 'hey I thought you were worth 500 million and they're cutoff is 200 million why are you not on there Bob?' Or if you try to fake your way on and Forbes finds out which it would over the years, you're taken off the list and seen as a promoter in what went wrong. 'I guess your business isn't going so well, I guess we won't lend you a $100 million for this new shopping center that you want to build Bob. So most people, to the extent that they participate with Forbes, they participate in order to help ensure accuracy. So only Donald Trump, he's an outlier, there are very few people who try to game the system.

BOB GARFIELD Now you have panned over the years a number of mea culpas about getting suckered in this scheme. So, you know, let us just put aside for the moment questions of journalistic negligence and go to the supply side of the conversation. Which is, tell me again what's in it for Trump to start building this lie in 1982 and leveraging the fake assets over the years?

JONATHAN GREENBERG With ordinary business people, you need to show a cash flow statement that includes all the debt. What Trump really did was use the Forbes 400 and said, 'well look, they're the best experts. Here's my statement here's what they say. His own statement showed even more. And he says, 'well Forbes has me for 600 million, you knowm if you don't want to believe me look at them.' And if they said, and this is what this is what the gray area is that has yet to come forth in the media, if they would say, 'well listen we need a statement of profit and loss,' he'd say, 'I don't have time for that, Bob of Citibank. I'm going to go to JP Morgan. I'm gonna go to Chase and you know and I'll get you fired by the way too. Because I've shown you everything you need. It was enough for Chemical Bank. Why isn't it enough for you?' And so it's a combination of threats in lies. And a lie, or the deception, was that Forbes had validated this information independently. Why did they need to bother him for more info.

BOB GARFIELD By time, when journalists began reporting the depth of his financial woes, he also actually sued one author for libel. He lost the case and he threatened to sue others. So crucial to his house of cards was the illusion of great wealth and power. Right?

JONATHAN GREENBERG Absolutely. Forbes took them off the list for five years but The Art of the Deal was a huge bestseller. He was cemented in the public consciousness as a tycoon.

[CLIP]

MALE CORRESPONDENT Donald Trump is here. You're on the cover of the new issue of People magazine. I don't what I'm beating around the bush here. I don't know why you're being so goofy about this. It says on the cover you're a billionaire at 41.

DONALD TRUMP It does say that.

MALE CORRESPONDENT Yeah. So what you--.

DONALD TRUMP If People says it, I would have to believe it. When People says--[END CLIP]

BOB GARFIELD Which got him funding for a series of catastrophic ventures, Trump Airlines, Trump casinos, Trump University, Trump meat. A billion dollars of 1990s losses as we now see reported in The Times. Losses of other people's money. And he rode this fiction to the White House. So Jonathan it's all your fault, right?

JONATHAN GREENBERG Ha. It's all--it's all my fault Bob. Had I only known.

[CLIP]

DONALD TRUMP Forbes just came out and they said I'm worth four and a half or five billion dollars. [END CLIP]

JONATHAN GREENBERG People still believe him. It is our fault. He's the only one who ever played the system like this and people continue to underestimate the depth of his deceit and how far he'll go with a lie.

BOB GARFIELD This Forbes 400 was a tremendously successful for Trump, obviously. I guess we should not ignore the fact that it was also vastly successful for Forbes magazine. No?

JONATHAN GREENBERG Absolutely. It was the biggest success of any project Forbes ever worked on in its hundred year history. We made celebrities out of billionaires.

BOB GARFIELD Jonathan, thank you very much.

JONATHAN GREENBERG Thank you Bob, it's been a pleasure.

BOB GARFIELD Jonathan Greenberg is an investigative reporter who's written for The Washington Post, The New York Times and, of course, Forbes. For three years in the 80s, he helped bring us the Forbes 400.

[MUSIC UP & UNDER]

BOB GARFIELD Coming up, a whole other slant on big money and taxes. This is On The Media.

[MUSIC UP & UNDER].