The Art of Negotiation

Financial FAQs

This column comes from a chapter in my forthcoming book, Answering the Kennedys Call to Promote World Peace and Freedom, a history of public service and community building by my own and more recent generations. This chapter documents the importance of cultivating good negotiating skills.

We start with perhaps the best-known example of bad negotiating skills; President Donald Trump of all people, who has called himself “the best negotiator in the world.” But we now know Trump’s deals in Art of the Deal were not good deals, since he lost more than $1.17 billion in ‘deals’ over the 10 years 1985-94, during the time it was written, according to the NYTimes.

So Trump had to know he was hurting when it was published in 2015. Trump’s co-author on The Art of the Deal, Tony Schwartz—who apparently wrote almost the entire book himself—mentioned in a Forbes article that he worked hard to ignore all of the evidence of Trump’s poor deal-making, and “put lipstick on a pig” to create the image of Trump as a great negotiator.

“What’s interesting,” said MarketWatch columnist Paul Brandus in writing about Trump’s tax losses, “is that even with one mild recession, the overall period in question—1985 to 1994—was a boom time for the U.S. economy. GDP grew 43 percent, and the stock market, as measured by the S&P 500 grew 171 percent—not counting dividends.

In fact, a 2016 USA Today investigation mentioned by Brandus that I wrote about at the time revealed Trump over the last three decades has been the target of some 3,500 lawsuits by employees and contractors over alleged non-payment. Many of the people who sued Trump were hard-working blue-collar types like dishwashers, painters and waiters—the very kind of “small guys” that candidate Trump claimed he was always looking out for, said USA Today.

“The president’s alleged cheating continues to the present,” continued Brandus, “Trump has been hit with at least $5 million in unpaid liens by workers at his lavish new hotel here in Washington—just five blocks from the White House.”

It doesn’t take a negotiating genius to know why Trump has repeatedly failed to negotiate successfully. It means he never learned the art of negotiation, which needs to have what we call a “win-win” outcome in which both parties gain in some way—at least in the normal world we live in; if we want to build relationships and have a successful reputation, which Trump singularly lacks.

It means there is a buyer wanting something for a good price, and seller that still needs to make a profit; or negotiating the timing of a meeting; or parents negotiating with children over playtime, allowance, behavior, or whatever. The point being that the negotiation won’t succeed if an agreement isn’t reached that both sides feel is a win in some way.

It really needs to be called the Art of Compromise, since all parties know they will meet somewhere in the middle to be successful. But there is nothing Pollyanna about a successful negotiation, since in high stakes negotiations each side usually probes the other’s weaknesses; who may have a time constraint, or badly needs the money. One side can also threaten to walk away; as has happened in countless labor negotiations with management. There are lots of tricks to the trade, in other words.

But bullies and autocrats, such as President Trump, or politicos who refuse to compromise on their legislation, are doomed to fail in getting what they want, other than a temporary feeling of power.

The dysfunctional federal government is such a case in point at present. Republicans since House Speaker John Boehner have consistently refused to compromise, and the result is almost no legislation has been passed, except for the 2017 Republican tax cuts that benefited only the wealthiest and is highly unpopular.

It doesn’t mean the art of negotiation can’t be learned. But it takes practice and some fortitude to be able to say no, or accept rejection, or even step back when it becomes too one-sided.

Harlan Green © 2019

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

Who Is the Real Donald Trump?

Popular Economics Weekly

It certainly behooves US voters to know the real Donald Trump. Tony Schwartz, ghost writer for Trump’s best-selling “Art of the Deal” has just come forward after 30 years with a ‘tell all’ New Yorker interview based on the 18 months he spent with Trump when writing the book.

The public already knew that Trump has sued and been sued thousands of times in court over his business practices, declared bankruptcy 4 times (plus 2 more BKs by investors left with the casino’s assets), and been indicted on RICO charges in a San Diego court over Trump University.

His supporters maintain his racist, wall building, anti-abortion, Putin-loving, anti-trade remarks aren’t the real Trump. He is really a loving and lovable family man, who supports his friends and treats his employees fairly, whatever their ethnicity.

But Schwartz maintains there is no real Trump. He is whoever you want or would like him to be, and totally focused on making deals that benefit him. It can be either sad, or terrifying.

“Trump has been written about a thousand ways from Sunday, but this fundamental aspect of who he is doesn’t seem to be fully understood,” Schwartz told Jane Mayer, author of the New Yorker article. “It’s implicit in a lot of what people write, but it’s never explicit—or, at least, I haven’t seen it. And that is that it’s impossible to keep him focussed on any topic, other than his own self-aggrandizement, for more than a few minutes, and even then. . . .If he had to be briefed on a crisis in the Situation Room, it’s impossible to imagine him paying attention over a long period of time,” said Schwartz.

“I put lipstick on a pig,” he said. “I feel a deep sense of remorse that I contributed to presenting Trump in a way that brought him wider attention and made him more appealing than he is.” He went on, “I genuinely believe that if Trump wins and gets the nuclear codes there is an excellent possibility it will lead to the end of civilization.”

There is more to come on the real Trump. A hearing this Friday is scheduled in Judge Gonzalo Curiel’s San Diego courtroom on whether to dismiss RICO charges in the Cohen vs. Trump class action lawsuit that says Trump intentionally defrauded hundreds of students who enrolled in Trump University.

The case contends that Trump University amounted to civil racketeering, a fraud that lured customers into spending thousands of dollars by making false promises that they would learn the businessman’s secrets, taught by his hand-picked instructors—which is why the case is being made under the Racketeer Influenced and Corrupt Organizations Act, or RICO.

However, it isn't very likely that Judge Curiel will honor Trump’s request to dismiss the very damaging RICO charges. That’s because, in the words of the plaintiff’s attorneys, representing those defrauded by Trump University, "Trump denies operating and managing the 'fraudulent marketing scheme' alleged here because he only starred in the marketing materials; signed the marketing materials; corrected the marketing materials; and approved the marketing materials. And therefore, he deserves summary judgment. Because he did not operate and manage the Trump University 'fraudulent marketing scheme.' He only starred in the marketing materials. Signed them. Corrected them. And approved them.”

If he were writing “The Art of the Deal” today, Schwartz said, it would be a very different book with a very different title. Asked what he would call it, he answered, “The Sociopath.”

Presidential candidate Trump might not want the public to know the real Trump, even if there is such a person. That’s because he has branded himself as the ‘best of the best’. He has attempted to enshrine his name—and therefore himself—as synonymous with success, when the facts under increasing scrutiny seem to be just the opposite.

Harlan Green © 2016

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

Trump Must Hate the Little Guy

Financial FAQs

The Republican Party may rue the day they didn’t vet their presumptive candidate for President. The vetting can no longer just be about his overt and premeditated racism, or even his xenophobic wall building. His business practices are finally coming under detailed scrutiny, and what we see is very ugly.

A USA TODAY article catalogues more than 3,500 lawsuits filed for or against Donald Trump over his business career. Many were filed by small business people and firms that Trump refused to pay for work done on his various real estate properties.

The result was that many were driven out of business. It looks like Trump’s main business model was and continues to be preying on those who are least able to defend themselves legally, in order to enrich himself. This smacks of more than predatory business practices.

David Brooks’ latest New York Times Oped this tries to put a handle on his narcissistic behavior. “By one theory, narcissism flows from a developmental disorder called Alexithymia, the inability to identify and describe emotions in the self. Sufferers have no inner voice to understand their own feelings and reflect honestly on their own actions.”

Could this also be defined as sociopathic behavior, since he seems to have no compunction in harming others financially, especially those least able to defend themselves in court?

Psychology Today defines sociopathy as follows; “A sociopath can be defined as a person who has Antisocial Personality Disorder. This disorder is characterized by a disregard for the feelings of others, a lack of remorse or shame, manipulative behavior, unchecked egocentricity, and the ability to lie in order to achieve one's goals.”

Donald Trump often portrays himself as a savior of the working class who will "protect your job." But a USA TODAY NETWORK analysis found he has been involved in more than 3,500 lawsuits over the past three decades — and a large number of those involve ordinary Americans, like the Friel family, who says Trump or his companies have refused to pay them.

The Friel’s family cabinetry business, founded in the 1940s by Edward’s father, finished its work in 1984 and submitted its final bill to the general contractor for the Trump Organization, the resort’s builder.

Edward’s son, Paul, who was the firm’s accountant, still remembers the amount of that bill more than 30 years later: $83,600. The reason: the money never came. “That began the demise of the Edward J. Friel Company… which has been around since my grandfather,” he said.

Graph: USA Today

This is not to speak of a Florida lawsuit against Trump and his Trump's Doral golf resort--also embroiled in recent non-payment claims by two different paint firms, with one case settled and the other pending, says USA TODAY. Last month, his company’s refusal to pay one Florida painter more than $30,000 for work at Doral led the Miami Dade Circuit Judge Jorge Cueto (whoops, another Hispanic Judge) to order foreclosure of the resort if the contractor isn’t paid.

Juan Carlos Enriquez, owner of The Paint Spot, in South Florida, has been waiting more than two years to get paid for his work at the Doral. The Paint Spot first filed a lien against Trump’s course, then filed a lawsuit asking a Florida judge to intervene.

“In courtroom testimony, the manager of the general contractor for the Doral renovation admitted that a decision was made not to pay The Paint Spot because Trump “already paid enough,” said USA TODAY. As the construction manager spoke, “Trump’s trial attorneys visibly winced, began breathing heavily, and attempted to make eye contact” with the witness, the judge noted in his ruling.”

It looks like Trump’s attorneys and supporters will continue to wince as more stories of his business practices come out—whatever his personality disorder. Republicans should have definitely vetted him, instead of listening to his hype.

Harlan Green © 2016

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

Trump RICO Trial Date Set

Popular Economics Weekly

Trump says he will be the first candidate since 1976 not to release tax returns. Analysts said that Trump likely pushed the envelope to turn ordinary income into capital gains, and deferred the payment of tax through like-kind exchanges, said the MarketWatch report. The tax returns could also verify how much income he receives from licensing his name.

In fact, they could show much more—for instance, how much of his fortune was made from defrauding other investors. Trump’s sordid business dealings are known to very few, as I’ve said in past columns. And now Donald Trump will go to trial in a class-action lawsuit against him and his now-defunct Trump University that includes the Racketeer Influenced and Corrupt Organizations Act, or RICO charges, after the presidential election but before the inauguration, setting the stage for a president-elect to take the witness stand if he wins the White House.

One of his 4 Chapter 11 (business) bankruptcies was for Trump Casinos and Hotels. “For 10 years between 1995 and 2005, Donald Trump ran Trump Hotels & Casino Resorts — and he did it so badly and incompetently that it collapsed into Chapter 11 bankruptcy,” said Marketwatch’s Brett Arends, who has been tracking his business failures for years. “His stockholders were almost entirely wiped out, losing a staggering 89 percent of their money. The company actually lost money every single year. In total it racked up more than $600 million in net losses over that period,” something no other major casino chain did over that term.

 

Graph: MarketWatch

In total, Donald Trump pocketed $32 million in nine years of running Trump Casinos and Hotels, while his public stockholders lost more than $100 million. But much more damaging are the various class action lawsuits filed again Trump and Trump University, which was a university in name only.

Instead of receiving a quality degree, “as good as any from a university”, said Trump, students received a printed certificate and no degree after spending as much as $36,000 on a weekend course that solicited more money, and were given commonly known real estate websites, such as Zillow, and several worthless property referrals.

These are the words of several plaintiffs suing Trump that a San Diego court has elevated to gangster status. Trump is accused of not only fraud, but racketeering, as if he were running a criminal enterprise.

U.S. District Judge Gonzalo Curiel on Friday scheduled trial for Nov. 28 in the suit that alleges people who paid up to $35,000 for real estate seminars got defrauded. The likely Republican nominee planned to attend most, if not all, of the trial and would testify, Trump attorney Daniel Petrocelli said.

“This means that, fairly or unfairly, opponents will be able to say that a large group of everyman voters, many of them elderly, have accused a leading contender for the Oval Office of being a racketeer,” said Time Magazine’s Steven Brill, who has been following the progress of this lawsuit, initiated more than five years ago.

Harlan Green © 2016

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

Who Can Trump Trump's Ambition?

Thomas Friedman seems to believe the Donald has almost sewed up a majority of the Republican Primary delegates and will be a formidable foe for Hillary, assuming she is the Democrat’s candidate.  But chances are his past will catch up with him as voters begin to think with their head rather than gut instinct that Friedman seems to believe motivates many voters.

“Donald Trump is a walking political science course,” said Friedman in a NYTimes Op-ed. “His meteoric rise is lesson No. 1 on leadership: Most voters do not listen through their ears. They listen through their stomachs. If a leader can connect with them on a gut level, their response is: “Don’t bother me with the details. I trust your instincts.” If a leader can’t connect on a gut level, he or she can’t show them enough particulars. They’ll just keep asking, “Can you show me the details one more time?”

That may be so for many Republican primary voters, but Trump’s suspect past hasn’t yet been investigated.  Thinking Repubs have given him a blank check to date, believing that he will flame out of his own accord.

Even Mitt Romney calling him a con artist last week didn’t seem to hurt Trump in Michigan, though Ohio Governor John Kasich was creeping closer in the final tally of delegate votes, in a defacto tie for second place with Texas Senator Ted Cruz.

Graph: Marketwatch

           

Trump’s sordid business dealings are known to very few.  One of his 4 Chapter 11 (business) bankruptcies was for Trump Casinos and Hotels. “For 10 years between 1995 and 2005, Donald Trump ran Trump Hotels & Casino Resorts — and he did it so badly and incompetently that it collapsed into Chapter 11 bankruptcy,” said Marketwatch’s Brett Arends, who has been tracking his business failures for years. “His stockholders were almost entirely wiped out, losing a staggering 89 percent of their money. The company actually lost money every single year. In total it racked up more than $600 million in net losses over that period,” something no other  major casino chain did over that term.

In total, Donald Trump pocketed $32 million in nine years of running Trump Casinos and Hotels, while his public stockholders lost more than $100 million.  But much more damaging are the various class action lawsuits filed again Trump and Trump University, which was a university in name only.

Instead of receiving a quality degree, “as good as any from a university”, said Trump, students received a printed certificate and no degree after spending as much as $36,000 on a weekend course that solicited more money, and were given commonly known real estate websites, such as Zillow, and several worthless property referrals.

These are the words of several plaintiffs suing Trump that a San Diego court has elevated to gangster status.  Trump is accused of not only fraud, but racketeering, as if he were running a criminal enterprise. 

One of the two San Diego cases has been allowed by the judge to be brought under the Racketeer Influenced and Corrupt Organizations Act, or RICO, said Time Magazine’s Steven Brill. “This means that, fairly or unfairly, opponents will be able to say that a large group of everyman voters, many of them elderly, have accused a leading contender for the Oval Office of being a racketeer.”

The records indicate, for example, that Trump University collected approximately $40 million from its students–who included veterans, retired police officers and teachers–and that Trump personally received approximately $5 million of it, despite his claim, repeated in our interview, that he started Trump University as a charitable venture.

Trump’s own followers may be able to disbelieve the evidence that is being unearthed of his many business failures in a hyper fervid primary season full of hyperbole.  But the facts are only now now coming to light. And the picture is revealing. 

The evidence is in plain sight.  The Donald always comes first, and very few others have profited thereby. 

Harlan Green © 2016

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen