The Trump real estate verdict and New York’s economy
William Jacobson says get out of New York while you can:
Rough politics has given way to the political weaponization of prosecutors’ offices. It’s dangerous and sets a tone for the entire state that political opponents of those in power are living – and operating their businesses – on borrowed time.
I don’t care what you think of Donald Trump, it’s disgusting, unseemly, and in my view completely unethical for a prosecutor to run for office pledging not only to get a political opponent, but also his family. That’s what Letitia James did when she ran for New York Attorney General. She then fulfilled that campaign promise, weaponizing her massive and powerful office to scour through Trump’s businesses to find a crime, but she found none that could be prosecuted so she brought a civil lawsuit to ruin Trump and his family.
Nothing about this process was within norms of how prosecutors should conduct themselves and their offices. It may not be unprecedented, but it’s still clearly wrong.
I don’t think the civil lawsuit had merit and predict it will be reversed on appeal, at least as to the outlandish fines imposed, but that’s besides the point. The lawsuit never would have been brought if James had not targeted Trump with the full weight of the NY Attorney General’s office specifically because she didn’t like his politics.
Professor Jacobson goes on to criticize the Bragg case against Trump, also in New York, and just as absurd in its charges.
I don’t know enough about the NY appeals court to say whether I think either case will be reversed at the state level (if indeed the Bragg case results in a conviction, which has an excellent chance of occurring). But I do think that if either or both cases go all the way to SCOTUS they probably will be reversed. There’s no question in my mind that guilty verdicts in either should be reversed, and I would say that even if the targets were blue – which of course they wouldn’t be in New York.
I blame not just James, but the judges who don’t throw such cases out of court because they are based on tortuous and novel legal “theories” that are obvious ploys to get one person. Juries likewise, but they are somewhat less culpable because it’s the judges who control the courtroom and what is allowed as evidence (the real estate trial was not a jury trial).
Governor Hochul realizes the real estate verdict could have a chilling effect on doing business in the state, but she is reassuring on that:
Hochul joined John Catsimatidis on “The Cats Roundtable” on WABC 770 AM, where she was asked if other New York businesspeople should be worried that if “they can do that to the former president, they can do that to anybody.”
“I think that this is really an extraordinary, unusual circumstance that the law-abiding and rule-following New Yorkers who are business people have nothing to worry about, because they’re very different than Donald Trump and his behavior,” Hochul responded….
The governor provided reassurance to New York businesses after the ruling. “By and large, they are honest people and they’re not trying to hide their assets and they’re following the rules,” she said of the people who own and conduct business in the New York City area.
But of course business people, especially those who do business on a large scale as Trump did, know full well that what Trump did was standard practice, has never been prosecuted before without someone being harmed as a result, and are aware that the way in which they are “very different than Donald Trump and his behavior” has nothing to do with their business practices and everything to do with their politics.
How many big business people in New York are conservatives and/or Republicans, and politically active? I don’t know, but I think it’s probably a relatively small number. But maybe not. People are voting with their feet (as the old saying goes) and leaving the state, but this has the effect of making it more reliably blue than ever, and will lead to more prosecutors such as James, more judges such as Engoron, and more juries that will convict those with whom they disagree rather than those who are guilty. It becomes a more and more dangerous venue for conservatives the more blue it gets.
Not that I’m suggesting people should stay for that reason. But it is a result of their departure.
Does New York really care? If most people see this as a one-off that only affects Trump, the vast majority will continue to invest there. Also, remember this ten years ago from then-governor Cuomo?:
New York Gov. Andrew Cuomo has caused a firestorm in the Empire State for declaring to a talk radio host that conservatives who are pro-life, pro-gun and anti-gay marriage “have no place in the State of New York.” Said Cuomo of conservatives: “Their problem is not me and the Democrats; their problem is themselves. Who are they? Are they these extreme conservatives who are right-to-life, pro-assault-weapon, anti-gay? Is that who they are? Because if that’s who they are and they’re the extreme conservatives, they have no place in the state of New York, because that’s not who New Yorkers are…. Moderate republicans have a place in this state.”
Clearly, Cuomo didn’t think these people were needed and felt the state would be better off without them. It would certainly be even more monolithically blue, which would give the Democrats more and more power to do whatever they wished.
NOTE: I’ve noticed that some people believe the real estate case was a criminal one, because it was brought by the state. But actually it was a civil case; see this.
Jonathan Turley provides his opinion:
In laying the foundation for his sweeping decision against former President Donald Trump, Judge Arthur Engoron observed that “this is a venial sin, not a mortal sin.” Yet, at $355 million, one would think that Engoron had found Trump to be the source of Original Sin.
The judgment against Trump (and his family and associates) was met with a level of unrestrained celebration by many in New York that bordered on the indecent. Attorney General Letitia James declared not only that Trump would be barred from doing business in New York for three years, but that the damages would come to roughly $460 million once interest was included.
That makes the damages against Trump greater than the gross national product of some countries, including Micronesia. Yet the court admitted that not a single dollar was lost by the banks from these dealings. Indeed, witnesses testified that they wanted to do more business with Trump, who was described as a “whale” client with high yield business opportunities.
Undervaluing and overvaluing property is a longstanding practice in New York real estate. The forms submitted by the Trump organization cautioned the banks to do their own estimates and the loans were paid in full and on time. Yet, the New York law used by James is a curiosity because it does not actually require a victim. Indeed, everyone can make ample profits and still allow for an investigation into “repeated fraudulent or illegal acts.”
I see plenty of jubilation online, too. It doesn’t matter to the celebrants that the law has never been used this way before and that it is clearly a biased political prosecution. They want Trump to suffer and they don’t care how it happens, but giving it the color of law is the icing on the cake.
Having campaigned on bagging Trump on any basis, James turned the law into a virtual license to hunt him down along with his family and his associates.
Engoron proved the perfect judge for the case. The opinion itself seems almost cathartic for the jurist who struggled with Trump inside and outside of court. In the judgment, Engoron fulfilled Oscar Wilde’s rule that the only way to be rid of temptation is to yield to it. He ordered everything short of throwing Trump into a wood chipper.
Turley isn’t usually quite that colorful in his writing. But he is very incensed about this case and this verdict:
The size of the damages is grotesque and should shock the conscience of any judge on appeal.
That would require a conscience, however.
Turley believes this will hurt business in NY:
As James gleefully uses this law to break up a major New York corporation, it is hard to imagine many businesses rushing to the Big Apple. …
The one hope for New York businesses may be the U.S. Supreme Court. Despite the deference afforded to the states and their courts, the court has occasionally intervened to block excessive damage awards.
So according to Turley, it’s not even clear that SCOTUS would take the appeal. I think it would, but I certainly don’t know. And would it happen prior to the election? Ordinarily the case has to go through the state system first.
I think this part of Turley’s essay actually makes one of the most important points of all:
In electing openly partisan prosecutors such as James and District Attorney Alvin Bragg, voters have shown a preference for political prosecutions and investigations.
We have no Government armed with Power capable of contending with human Passions unbridled by morality and Religion. Avarice, Ambition Revenge or Gallantry, would break the strongest Cords of our Constitution as a Whale goes through a Net. Our Constitution was made only for a moral and religious People. It is wholly inadequate to the government of any other.
What goes around comes around.
See, e.g., Fani Willis
I hope Trump has someone digging up the dirt on Bragg and James. And Hochul, too.
The dirt will be there. No one gets that high in NY politics by being honest.
Trump was not always persona non grata to NY leftists. The Clintons went to his wedding. He got some civil rights award. But when the left needed to destroy him, they showed no hesitation. For those with leftist friends, ask yourself what would they do if you, for some reason, needed to be destroyed. Would they stick up for you?
I think this is very good news for Florida. Mountain states, Colorado, Wyoming, Montana, even Idaho, have been doing well. A lot of wealthy folks moving to those states. Tennessee and parts of the Carolinas are attracting many, and have been for several decades.
California has extraordinary unique terrain and a variety of climates to appeal to all tastes. In Accounting terms, it had tremendous “goodwill,” but it is so politically mismanaged many are leaving. And ridiculous prices are keeping folks from retiring there. The Yogi’ism, “nobody goes to that restaurant any more, it’s too crowded,” applies to California.
Even the most snobby northeasterners and Californians can be impressed when they visit Florida. There are some very snobby, high end areas there. Florida’s high end construction and gated communities can convince a lot of elitist folks to get over their distaste for “the South,” but Florida’s summer weather is something no real estate developer can fix.
Manhattan’s (and Chicago’s Loop, and Detroit and Boston and other, big cities’ urban, business cores…) concentration of corporate offices is of little benefit to businesses in a world where high speed internet is available everywhere. Why pay outrageous rents for office space to be close to other companies paying outrageous rents for office space when most of your employees don’t want to commute to an office and any contact you have with vendors, clients and business partners is already via zoom?
As a retired unsuccessful criminal I am against any & all Laws made by humans or a King. Am also waaay further to the right than the Republican party—hence am registered as NPA (No party affiliation) in Dixie County, Florida. Yes, all my rights were restored except firearm ownership, so I can vote. Ditto on the Yes, Dixie County exists in Florida.
Democratic party has sought to control the Law for decades, and Obama opened the door for them. We are now seeing what they can do with a tiny control of the Law, so one can easily see what they will do once they have full control of the Law.
Conservatives like to harp about how great living under the “Rule of Law” is, but human Laws are all about who controls them—and/or controls the making of them, i.e., the ‘Controller of the Law’ gets to cram them down the throats of other humans. “Rule of Law” is just a modern version of the old King’s Law, IMHO.
Cross-posted from the open thread.
Jonathan Turley on further outrages in the New York verdict against Trump. He cannot appeal without depositing the entire amount of the proposed fine with the court as bond.
https://nypost.com/2024/02/19/opinion/democrats-weaponized-justice-system-to-punish-trump-in-business-case/
And the truckers are planning not to deliver to NYC. They claim their bosses can get them loads to anyplace–remember the driver shortage?
And those of you who’ve driven in NYC can imagine the difficulty of handling a semi there. Other destinations would seem a great idea.
So what reduction in incoming product–most kinds–does it take to inconvenience the locals? 2%? 5%?
I expect nobody’s been exerting themselves to ship too much into the city on a regular basis so that a modest reduction drops it to “just right, no surplus”. Any reduction will be from the necessary.
Anybody recall a bazillionaire who doesn’t mind being seen to be rich getting such support from the hard-nose blue collar guys?
Some of it’s Trump. And a lot of it’s his enemies.
As someone who has relocated for work several times I put a lot of emphasis on what executives’ wives think when gauging the future of business facilities. When given the choice of a relocation I gauged my decision on what Mrs. Firefly thought. Take a trip with her, meet a realtor, tour some schools… I would tell her, “I understand the job, I understand the business and I can do the work. It’s an office and a desk. Can you find a place here where we’ll like to live, schools where our kids will do well, friends we can socialize with?” No matter how great the job I would have been very hesitant to move without her buy in. And, no matter how great the job, I would have been very hesitant to NOT relocate if she felt our family was unsafe or our kids could not receive a good education.
Executives’ wives are hearing from their friends who left NY, Philly, Boston, San Francisco, San Jose, D.C. and moved to Boise or Denver or the Carolinas or Florida. They see how much further one’s real estate dollar goes in those areas. How much easier it is to get around. How much better the weather is. How much safer it is. The lack of homeless and illegal immigrants…
I think a lot of executives are getting an earful from their spouses. “Susie’s husband moved his firm to Boca Raton and they live on an acre of land that backs up to an inlet where their boat is docked in a gated community with a great country club and she’s always tan and their kids love the weather and one of their neighbors is that guy who was in that movie and she’s friends with that athlete’s wife and the wife of that guy who owns that business…”
If Trump is elected, he should accept this court ruling barring him from controlling legal entries doing business in New York by forbidding any Federal entities under his authority (i.e., the executive branch) from doing business in New York.
If lawyers object that it is not the explicit terms of the court order, he should reply that it is the spirit of the order and he will abide by the spirit to avoid being held in contempt.
I shall watch with great interest the trucker’s strike.
Kate @ 4:40pm,
How can that be Constitutional? That’s insane!
Two more quotes:
“There are two passions which have a powerful influence in the affairs of men. These are ambition and avarice—the love of power and the love of money. Separately, each of these has great force in prompting men to action; but, when united in view of the same object, they have, in many minds, the most violent effects.”
–Ben Franklin
“Now, the pursuit of power is a zerosum game: you acquire power only by taking it away from someone else. The pursuit of money, however, is not a zero-sum game, which is why it is a much more innocent human activity. It is possible to make a lot of money without inflicting economic injury on anyone. Making money may be more sordid than appropriating power—at least it has traditionally been thought to be so—but, as Adam Smith and others pointed out, it is also a far more civil activity.”
–Irvin Kristol
What the Democrats have done–and what has moved into overdrive under Obama and Biden–is the tight coupling of the pursuit of money and the pursuit of political influence and power, This coupling is devastating both to the American economy and to the American spirit.
Karmi:
I take it you’re not a Hobbes fan, then.
Oh, yes, I can never forget it. If I had to point to one single thing, one moment, that decided me for the rest of my life against associating myself with this state any more than absolutely necessary, that was it. Not to mention the decisive role that interview played in shaping my view of His Royal Highness on a personal level.
So this was a civil suit? I figured it was criminal, because the state brought the case.
Then Elon Musk’s question does apply: “Given that there are no victims with losses, who is supposed to receive the money?”
I guess we can assume that the state gets all the money, but Musk’s question raises other questions about this very questionable verdict.
Rufus T. Firefly, according to Turley, the requirement to post the entire penalty with the state in order to appeal is in the law which NY State used against Trump. Of course, it’s never been used in this way before, and such a massive penalty was not in the minds of the legislature, even in New York, when it passed.
I think the whole thing is unconstitutional, but I have no idea what avenues Trump has to challenge its legality.
Kate,
That invites an interesting approach that could have Trump’s side jiujitsu this to damage New York.
In the contracts Trump’s side gave a value for the properties and the contracts stated the lenders are free to do their own determination of value. The interest rates were based on the valuations.
Therefore, if Trump’s valuations were wrong and/or the lenders failed to correctly value the properties, resulting in Trump getting a lower interest rate doesn’t this invite a class action suit from all the other borrowers using those same lenders who did not receive artificially lowered interest rates?
Wouldn’t the actual victims be those borrowers who were not given the favoritism Trump was given? What if a class action suit was brought on behalf of those borrowers?
New York’s DA’s office playing such absurd, ridiculous games with the law opens any lender in New York to ridiculous standards of due diligence and liability. This case sets that legal precedence. A class action suit against them would scare off any commercial real estate lender from writing loans in New York city.
Alinsky’s 4th rule for radicals, “Make the enemy live up to its own book of rules.”
“So what reduction in incoming product–most kinds–does it take to inconvenience the locals? 2%? 5%?”
– Richard+Aubrey
at 4:42:
I saw a prepper video that said most cities are nine meals away from problems. That’s three days. Unless a lot of people have the recommended 30 days of food on hand, a city can get hungry rather quickly. The blue-collar class has a lot more power than most people realize. In the past they’ve not seen a need to exert it against their fellow citizens. With lawfare, the Green New Deal, Bidenflation, and a wide-open border people are getting fed up.
They don’t use the words. Gallant, noble, or dignified. There are other words which I don’t normally use but for entirely different reasons. Some words can’t be said by trash with any honesty. Other words are too low to leave the mouths of decent men.
I can swear like a Sailor. I am a Sailor. Ain’t no saint. But my parents paid for an education. I think I’ll use the vocabulary they paid for. Small minds equals small vocabulary.
All I can think about since October is the screams. I want pay back.
The last thing Israel needs is some geriatric fool. I wish I had something to offer. I’m looking at the tools available to me. Cutlasses were declared obsolete in 1949 in the USN. I’m still a good rifle shot.
You all have gotten your rifles from the Civilian Marksmanship Program?
The thing about blades though, is, they work all the time every time. I know. It sounds like silly talk.
If they’re well forged
J.J.
Ref “nine meals”
Even a small apartment can have that much food in stock. Depends on the number of people.
The problem is what the folks think when they know their usual grocery supplier is going to be out of food entirely by the end of the week. Even if they can get that far with the pantry.
If somebody knocks on your door wanting food…?
The utilities are out of spares?
If the general populace thinks there will be a shortage then that could be a self fulfilling prophecy. I live in Brisbane Australia and when we had floods a few years ago supermarket shelves emptied out in days, despite the fact there was no real underlying shortage. People stockpiling created a shortage where there othewise was none as they bought up weeks of supplies in a matter of days. The supply chains are built to handle regular demand – something like this can break them in short order.
Neo:
Unbeknownst to me at the time – on reflection solitary confinement was a ‘Gift’ which eventually led to life as basically a hermit (15++) w/ each year getting better. Human herding seems to start around 4-6 years old, is difficult to break away from, and a clear majority never even try. Hobbes made a strong case for humans needing to live under the King’s Law. Aside, there’s a quote, which I can’t recall, about humans willingly accepting a just taskmaster/ruler (???) which adds to Hobbes’ point. I’ll take solitary confinement over Hobbes’ herding anytime… 😉
NYC’s migrant ‘crisis’ has resulted in the beginning of severe budget cuts. Closure of libraries on Sundays, housing migrants in hotels and schools, reduced trash pickup, cutting back the police force by 5000 officers, an influx of migrant gangs are just the beginning. Add to the above, “Illegal migrants in NYC are receiving 7 months free rent, free meals, free insurance and more…” This is unsustainable and will result in much greater violence, leading to the city collapsing into chaos and the NY State national guard patrolling the city streets.
NYC liberals are about to “get it good and hard”. NYC can’t print its own money, the Biden administration is not going to close down US borders and red states will keep sending the migrants to the blue cities.
How many big business people in New York are conservatives and/or Republicans, and politically active?
I would hope (though this seems to be a stretch given our current circumstances) that even liberal or at least not GOP business people are given pause about what could be done if they get crosswise with The Party in NY for any reason. Hochuls’s typically ham-fisted attempt at “assurance” actually makes the threat pretty plain. There’s probably nothing new about it given the levels of corruption usually reported from the blue zones but it’s usually been a dirty little secret among the bureaucrats, politicians, and their victims. The openness would seem to indicate it’s going to move to a whole ‘nother level now.
I would imagine that with Musk already in “Biden”‘s sniper rifle sight, Ackman and those of similar inclination (e.g., divesting from woke universities with great fanfare) will be next in line, unless he somehow finds it in himself to publicly “repent”.
Maybe.
J.J.,
“The blue-collar class has a lot more power than most people realize. In the past they’ve not seen a need to exert it against their fellow citizens.”
Strikes. Less common in the U.S. than Europe, but still, we’ve had some doozies in our past.
Regarding Republican “Big Business” leaders in NYC:
It takes awhile for the gods of the copybook headings to catch up with business entities with an enormous structure and a huge surplus of assets, so often you’ll see progressives in control of such entities. You tend to find more conservative minded people running small to mid-size businesses. There’s a lot of ruin in a nation. Less ruin in a state. Even less in a city. There is a lot of ruin in Disney, Ford and the New York Times. Southpark Studios Global, Tesla and Townhall.com have to be more practical and nimble.
“Strikes. Less common in the U.S. than Europe, but still, we’ve had some doozies in our past.”
– Rufus T.
Yep. I lived through three at my airline. Two short strikes by the mechanics, and a doozy when we pilots were locked out by management. Their intent was to destroy the union. They almost succeeded.
It’s a rather disconcerting feeling to be picketing the training center and see your replacements riding buses into the place.
Because this was never about money, but rather about ending union representation on the property, the aftermath was not pretty. I retired eight years after the strike, and bitter feelings were still running high.
I have always believed that service industries, where a strike immediately impacts the lives and incomes of people who aren’t stakeholders in the dispute, should be forced into compulsory arbitration when negotiations have broken down. Most labor negotiations can be resolved when both sides are open to the facts and aren’t clinging to pie-in-the-sky aspirations.
Strikes in commodity industries are different. The commodities can be stockpiled so that the strike doesn’t affect non-stakeholders as much.
Unions have declined because many of them are run by professional union organizers who are often crooks. Workers have gotten sick and tired of being represented by thugs and crooks who don’t have their interests at heart. At least ALPA is still run by rank and fille pilots who can be voted out or recalled, unlike the heads of the SEIU, UAW, Teamsters, NEA, etc.
Karmi,
“Rule of law” means we are ruled by the law.
The alternate is “rule of man”.
The situation you describe is “rule of man”. Which seems to be the state we are now in.
from my sources, the bug judge engoron, clerked for the members of the appeals court, so odds are not good,
We used to love Maynard G Krebs… not so much now
but all these cases have other things in the background going on that will probably negate them…
however, they did something no one else was able to do
reveal them as knaves, and secure the idea they are fools away in a safe
Don:
Who makes the laws for the “Rule of Law”? Rule of Law is the term used by most conservatives, and a concept highly promoted by them. It eventually becomes the same old “King’s Law” tho maybe without an actual King. Who ever controls the Rule of Law gets to cram them down the throats of whomever they chose…so to speak.
In re “Hobbes”: https://directory.libsyn.com/episode/index/show/thenewthinkery/id/29896243
It’s a good discussion once the wheels start rolling a few minutes in, though the audio itself is a tad iffy at times.
It is no coincidence that three of the Trump prosecutors are black.
We are entering the post-Mandela South Africa phase of American jurisprudence.