EXCHANGE: Josh Marshall and Mark Cuban on Donald Trump’s Campaign Financing

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Editor’s Note: Mark Cuban is a genuine billionaire and frenemy of Donald Trump’s who’s been increasingly critical of Trump and the purported scale of his wealth over the course of the 2016 campaign. Having written at some length about the evidence that Trump’s claim to be worth over $10 billion is vastly exaggerated (technically speaking, a big fat lie) and that Trump may not even be a billionaire, I wanted to chat with Cuban about what makes him so suspicious. After all, billionaires have unique insights into how billionaires handle their money, even how purported billionaires handle their money.

What follows is a lightly edited email exchange between Cuban and me over the course of Tuesday and Wednesday.

Josh Marshall: Won’t release his taxes. No one wants to release their taxes. But it goes with running for President. The audit excuse makes no sense. And Trump would be proud if he found a legal way to pay no taxes. So there must be something really, really big he doesn’t want to reveal. Most obvious candidate: not worth nearly as much as he claims.

Mark Cuban: Don’t agree. He probably is embarrassed by how much he made in a given year. I don’t think it’s anything more than that.

Marshall: In 2004 Timothy O’Brien published a biography of Trump which quoted Trump business associates who said Trump was worth between $150 and $250 million dollars. Trump sued O’Brien (case was thrown out). But in the course of discovery O’Brien’s lawyers unearthed a Deutsche Bank assessment which pegged Trump net worth at $788 million. For the last decade Trump has been almost entirely in the licensing business. He hasn’t been a big player in Manhattan real estate for years. I’m sure licensing brings in a lot of money but nothing that gets you from under $1 billion to $10 billion. Manhattan real estate prices also skyrocketed. But not 10x.

Cuban: Your can value real estate at any number you want. I personally don’t care about his net worth. It’s not an important number.

Marshall: In his various financial disclosures Trump routinely conflates gross revenues with income or profit. Even running my puny publishing company, I know that this is such a category fudge that it’s only something you do if you are trying to massively falsify your financial reality. This is what made me think he might not even be a billionaire.

Cuban: You can file a complaint with the FEC. I’m surprised no one has.

Marshall: Steaks, ties, real estate seminar scams. Billionaires may be sharks. But all the ones I know of only hunt big game. I can’t believe anyone worth $10 billion would get involved in so many low-rent gambits. Trump worked on Trump U for years and apparently netted only about $4 million dollars. That much time and reputational risk suggests someone with far, far fewer assets than he claims.

Cuban: He spends a lot of time repeating the same mistake of trying to apply his brand to consumer products without much success. It suggests to me that he over values his brands.

Marshall: The last thing is about politics, something I know a bit about. Trump loaned his campaign over $40 million during the primaries. But he’s refused to sign the document that would prevent him from paying himself back out of future contributions.

Cuban: I wasn’t aware of that document. Tell me more

[Editor’s Note: As this story was being published, Trump announced he’d converted his campaign loan of more than $50 million into a direct contribution to his campaign.]

Marshall: Again, big political damage for no reason unless he really needs that money back. He had to be shamed into making good on his promise to contribute $1 million to vets causes. Again, big political damage unless it wasn’t easy to produce that amount of money.

Cuban: His FEC filings show his liquid assets. He can’t lie about them

Marshall: The final big tell for me is the current situation. Presidential campaigns require a lot of money – big payroll, lots of money on tech, vendors and tons on advertising. It requires at least hundreds of millions of dollars. Most figure a billion. You probably saw the news today that Clinton has over $40 million in cash and Trump has just over $1 million. Trump’s current situation is something like the political equivalent of Pearl Harbor. Clinton is rolling out a huge barrage of campaign commercials in swing states across the country. There’s zero counter from Trump, probably because the campaign is broke. This all means that Trump’s campaign is getting destroyed on the ground, totally undefended. Even a few tens of millions would make all the difference in the world right now. The only credible explanation I can see for why he’s not cutting himself that check is that he can’t, either because he’s ridiculously illiquid, is bound by some covenants tied to excess leverage or is literally broke. Mismanagement and stinginess just aren’t credible alternative explanations, not at this scale and with this much on the line.

Cuban: I wouldn’t say broke. I would say he is afraid of spending his remaining cash.

“He isnt an entrepreneur. He is a brand.”

Marshall: When you talked about this a few weeks ago you pointed out that Trump only reports about $150 million in liquid assets. You say that’s way, way less than you’d expect from someone who was worth $10 billion.

You have the secret billionaire decoder ring. For us financial mortals, what are we supposed to make of this evidence about Trump? Is he worth $10 billion?

Cuban: Net worth is the one number that is impossible to prove one way or another. Liquidity is the only barometer that matters.

Marshall: Is he even worth a billion? And is it possible he’s actually hard pressed to come up with even the relatively small amounts of money (for a billionaire) that would help his campaign in the current dire situation? As a guy who knows him, what do you think is going through his head?

Cuban: He wants to retain as much cash as he can and hope that he can use earned media to drive enough voters. That’s his bet.

Marshall: If he only has $150m in liquid assets, putting in another $50m or $60m would be a huge dent. Is it possible there are some covenants or debt obligations that make it impossible for him to access that money?

Cuban: He has a lot in funds and bonds. Very little in actual cash. So he may be hesitant because he has gains and would have to pay taxes. Or in the case of funds, he may be not be able to access it

Look at the fund raising email he just sent. The match was a great idea but he limited it to 2mm. That’s a red flag

Marshall: If you really have billions of dollars in assets in other functioning businesses, don’t you need a certain amount of liquid capital on hand just to run those businesses and be prepared for unexpected events?

Cuban: Of course. And that really is where the encumbered money is

Marshall: Why do you think he got involved in Trump University? It seems like a classic hustle. Isn’t that terrible for his brand, not to mention risking legal trouble?

Cuban: Because he over values his name as a brand. In his mind he could drive tens of millions in profits.

Marshall: It’s been widely reported that no US banks will do business with Trump or loan him money. His only relationship is with Deutsche Bank. Why would he be frozen out like that?

Cuban: No idea.

Marshall: For Republicans who are hoping Trump will either pony up a hundred million dollars or start hitting up wealthy donors for campaign money, what would you tell them to expect?

Cuban: He will do what they ask to not have to write a check.

He is a salesperson at heart. He will say what he needs to say in order to get people to write the campaign checks so he doesn’t have to.

Marshall: Given what you’ve seen and how much he has in liquid assets, what’s your best guess as to whether Trump is actually a billionaire based on any reasonable valuation of his assets?

Cuban: Don’t know. But I think he is a billionaire because of NYC real estate he owns.

Marshall: You know Trump. What should people know about him that maybe they don’t?

Cuban: He isnt an entrepreneur. He is a brand.

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