Every prospectus associated with any kind of investment contains the words, “past performance is not indicative of future results,” or something similar. However, even with this caveat, most investors will review the past performance of whatever fund, stock, company, executive or other asset or person they are considering investing in and factor that into their decision. This is part of the usual due diligence process. According to Merriam-Webster, in law, the term “due diligence” means, “the care that a reasonable person exercises to avoid harm to other persons or their property.” I would suggest that Trump’s recent election stemmed primarily because many people did not do their own due diligence and relied instead upon the right-wing media to do the due diligence for them.
Trump world media portray Trump as an astute businessman. Examining his past performance easily shows that is simply not true. He has a trail of failed businesses in his wake such as Trump Airlines and Trump University, which was forced to close due to fraud allegations. Trump has filed for bankruptcy half a dozen times and has been bailed out financially more than once by his father or other wealthy ‘friends.’ In addition, the Trump Organization was found guilty of fraud and ordered to pay a penalty of $364 million in a civil trial. The fact is, Trump is not an astute businessman, and he has survived because he is an exceptional con artist. In Montana where I used to live, they call a man like Trump, “all hat and no cattle.” He wants the world to think he is a great rancher, but the simple fact is, he is really not sure which end of the cow the hay goes in, and which end it comes out. That is Trump’s past performance as a businessman.
Trump world would like people to believe he is for the worker. In the past, he has left a trail of unpaid businesses that are simply too small to afford the legal costs to fight back. He has made it clear on numerous occasions that he is against unions and lands on the side of business owners and corporate executives on labor issues. He does not like to be photographed with disabled veterans because ‘it looks bad.’ Trump grew up with a silver spoon in his mouth and has zero idea what it is like for people to work hard and still be living paycheck to paycheck. That is his past performance with respect to the working man.
As we are facing the current round of outrageous cabinet picks it is completely consistent with Trump’s statements about always hiring the best people, which again is provably false for anyone willing to investigate a little. When you examine the people close to Trump, there is a common theme. Many have been indicted, convicted, served time in prison, are in the middle of ongoing investigations, are being sued, or are highly praised by America’s main adversaries. Steve Bannon went to prison. Peter Navarro went to prison. Paul Manafort went to prison. Rudy Giuliani has lost almost everything due to lawsuits for propagating falsehoods for Trump. Ryan Zinke was forced out of Trump’s cabinet for ethical violations. The list goes on and on and on. Trump does not hire the best people unless you define ‘best’ to mean ‘doing whatever Trump wants regardless of the cost and whether or not it is legal.’
Trump was never really tested with a real crisis with the exception of the COVID-19 pandemic. The results – over a million people died in the United States due to COVID, more than any other country in the world, primarily because of Trump’s ineptness. He prioritized politics over public health and trusted unproven and debunked cures rather than rely upon highly trained scientists and medical professionals. Does anyone really believe he will handle the next crisis any better?
Given Trump’s past performance be almost any metric, no one should expect that he will magically become an astute businessman, really care about working people, or be able to navigate large crises any more than he has in the past. And now he is surrounding himself with an outrageous cast of unqualified sycophants. Usually, when investors neglect to do their due diligence, things do not end well. I suspect since much of the American electorate failed to do (or care) about their due diligence, things in the upcoming Trump era will not end well for the country and much of the world. Perhaps next time, we should all read the prospectus more carefully.
