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Trump Barely Dodged Personal Bankruptcy in '90s; Eric Trump Talks Father's Tax Returns; Chris Christie Coaches Trump for Town Hall Debate; Bill Clinton: Obamacare "Craziest Thing in the World". Aired 2:30-3p ET
Aired October 05, 2016 - 14:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(COMMERCIAL BREAK)
[14:30:05] BROOKE BALDWIN, CNN ANCHOR: We're learning new details about how Donald Trump bet big and ended up nearly a billion dollars in debt in the '90s. It turns out Trump may have dodged personal bankruptcy, but barely.
A former securities analyst tells our Gloria Borger that Trump made a big mistake by taking, quote, "an enormous risk" on one of the largest casinos in the world.
(BEGIN VIDEOTAPE)
GLORIA BORGER, CNN CHIEF POLITICAL ANALYST (voice-over): We may not know how much Donald Trump did or did not pay in income taxes but we do know for sure that he amassed an astonishing amount of personal debt in the '90s, nearly a billion dollars worth. How is that even possible? Trump bet big.
MARVIN ROFFMAN, FORMER SECURITIES ANALYST: When casino gaming came into Atlantic City, it was a monopoly.
BORGER: Marvin Roffman analyzed the gaming business for a prominent financial services firm.
ROFFMAN: They had basically the whole eastern market to themselves and everyone was looking for land to build a casino.
BORGER: Trump liked those odds and opened two casinos in Atlantic City in as many years, Trump Plaza and Trump's Castle, all part of a spending spree in the 1980s that included the iconic Plaza Hotel in New York, a Palm Beach estate, an airline, a yacht, and the largest tract of undeveloped land in Manhattan.
But for Trump, it wasn't enough. After months of complex negotiations, he bought one of the biggest casinos in the world, the Taj Mahal in Atlantic City.
ROFFMAN: And my telephone rang and he said, Marvin, didn't I do a terrific deal? And I said, "I think you did a great deal, but I think you made a mistake."
(LAUGHTER) BORGER (on camera): You said to Donald Trump you made a mistake?
ROFFMAN: I said -- I said, "I think you made a mistake," and he said, "What do you mean?" And I said, "Why own three casinos in Atlantic City? How are you going to differentiate the marketing?" And here was his comment, "Marvin, you have no vision. This is going to be a monster property."
BORGER (voice-over): That needed monster financing.
(on camera): How big a risk did you think he was taking?
ROFFMAN: Enormous risk. To be able to make this project successful, to break even, you'd have to generate a casino win of somewhere over a million dollars a day. And no casino in the world had ever even come close to anything like that.
BORGER (voice-over): The Taj was the biggest bet of his career, but soon his luck would run out.
ALAN POMERANTZ, ATTORNEY: He knew he was in big trouble. I think he borrowed more than most other prudent real estate people. And he had extended himself to the Trump shuttle, to a yacht, to a helicopter, and to a lot of thing which weren't generating any cash flow, and he had to support his life-style so he was in trouble.
UNIDENTIFIED AUCTIONEER: $190,000, we're going to sell it.
BORGER: When the economy and the real estate market plummeted in 1990, Attorney Alan Pomerantz says Trump owed $4 billion to his debtors, including that billion dollars for which he was personally responsible.
POMERANTZ: Because he personally guaranteed so much debt, the leverage shifted dramatically over to the banks, because it was no longer an issue of a bank and a piece of real estate, it was a bank and Donald Trump's actual survival.
BORGER: Trump owed money all over town, to 72 banks in all.
Pomerantz represented them as a group.
(on camera): How close was he to going personally bankrupt?
POMERANTZ: Very.
BORGER (voice-over): Trump makes a point of saying he never went personally bankrupt. But there's a reason why the banks decided to keep Trump whole.
POMERANTZ: We made the decision he would be worth more alive to us than dead. Dead, meaning in bankruptcy. We don't want him in bankruptcy. We want him in the world selling these assets for us.
BORGER (on camera): So you wanted him alive because he was a salesman and could best sell his own properties? POMERANTZ: That's correct. We kept him alive to help us.
(END VIDEOTAPE)
[14:34:38] BALDWIN: Coming up, we'll talk to Gloria and get her response to that comment.
And we'll also talk about what Eric Trump, what he has just said on CNN about his own father's taxes.
And any minute now, Donald Trump will take to the stage in Henderson, Nevada, to speak. Will he bring up his running mate's performance in last night's V.P. debate? We'll take it live.
You're watching CNN.
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BALDWIN: We are watching and waiting to hear from Donald Trump there in Henderson, Nevada, a big state ahead of this November 8th election. We'll keep an eye on that.
Meantime, let's move along and talk about his son, Eric Trump, confronted about his father's taxes. You know the story from "The New York Times" suggesting, based on Trump's 1995 tax documents, Trump may have avoided paying federal income taxes for two decades. Here's what Eric Trump said.
(BEGIN VIDEO CLIP)
DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: Has he paid federal income taxes over the last 18 years, yes or no?
ERIC TRUMP, SON OF DONALD TRUMP: Of course, yes. Absolutely. My father pays a tremendous amount of tax --
(CROSSTALK)
BASH: So if we ever see your father's income taxes, it will show he has paid federal income taxes?
ERIC TRUMP: There's no question about it. We pay tremendous taxes as --
(CROSSTALK)
BASH: Will we see it?
ERIC TRUMP: Listen, when the audit is over my father will release it.
(END VIDEO CLIP)
[14:40:16] BALDWIN: Gloria Borger, let me bring you in.
And kudos to Dana Bash for grabbing him. And we'll get to the clip we played from your documentary in a moment,
but when you hear Eric Trump and when he says, "No question about it, my dad paid those taxes and you'll see it once the audit is through," do you think there is this pressure? Do you think there is any chance that we see taxes before November 8th?
BORGER: I think slim to none. I think that seven out of 10 people in this country believe that your taxes ought to be produced if you're running for the presidency. Eight out of the 10 people in this country think it's a civic duty to pay your taxes. I believe it's unlikely that Donald Trump is going to release taxes that go back in years. Maybe there's a slim, slim chance that he would release his last year's taxes if those aren't under audit but I'd have to say I think it's highly unlikely.
BALDWIN: Do you think it's possible his son doesn't know?
BORGER: I do. I do. I think his son is involved in a lot of businesses with him, and I'm sure they're involved on the corporate side, but I'm not sure he knows everything about his father's income taxes.
BALDWIN: To the clip we played with the real estate attorney, that was quite the moment, when he talks about how close Donald Trump was to bankruptcy, and he says we made the decision he was worth more alive than dead, dead being bankrupt. What was your response when you heard him say that?
BORGER: We went back at it because what it meant -- and the irony of this is of course Donald Trump likes to talk about the fact that he never went personally bankrupt. But the reason he didn't go personally bankrupt is because the banks needed him to sell off those assets that they now owned and, of course, Donald Trump is a great salesman.
And let me tell you a little story this lawyer, Alan Pomerantz, told me. This in the middle of these proceedings with representatives from 72 banks around the table Donald Trump is kind of signing away everything he owns with a stack of documents this high. In the middle of that procedure, Alan Pomerantz told me, Donald Trump stopped the proceedings, had one of his aides bring in a box. In the box were copies of "The Art of the Deal," --
BALDWIN: No kidding?
BORGER: -- which he personally autographed for every table. Then they continued with the bankruptcy proceedings. How do you like that?
BALDWIN: No kidding.
BORGER: Yeah, interesting story.
BALDWIN: I would love to see what's on the editing room floor from the doc.
(CROSSTALK) BORGER: That's in the doc. That's in the doc.
BALDWIN: I know. I watched. I know.
But ahead to tomorrow, we're four days away from the town hall. This is the second of three debates between Donald Trump and Hillary Clinton. We know he's doing a real-life town hall scrimmage. He hasn't done a lot of these. He's been coached by someone who is excellent at them, Chris Christie. How helpful will this be?
BORGER: I think he has to do it and this is the staff's way of making his focus because it's hard to get him to practice and as you know, Brooke, we've had a bunch of town halls with Donald Trump and what strikes me about Trump versus the other political candidates we've seen is that when they were in town halls they would connect with the questioner, they would ask the details about their personal issues and their problems and -- John Kasich comes to mind, of course. And Donald Trump would, instead, sit in his chair and then address Anderson after the person in the audience asked the question. So I think what he needs to work on is this kind of one-on-one communication with a member of the audience that we haven't seen him do a lot of. He likes the big gatherings, right? Not the small town halls, and this is a very different venue for him.
BALDWIN: Gloria Borger, thank you so much.
BORGER: Thanks, Brooke.
[14:44:28] BALDWIN: Coming up next, Donald Trump seizing on some comments about Obamacare made by former President Bill Clinton, and somehow, in doing so, managed to bring up the Clinton's marriage. We will play what Mr. Trump said for you in its entirety.
Also, we're watching Henderson, Nevada, there. Big stars and stripes. We're waiting to hear from Donald Trump just after this big V.P. debate. What will he take away from his vice presidential contender's performance to apply in the town hall? We'll listen in.
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BALDWIN: Former President Bill Clinton wants you to know that he really, really likes Obamacare, even if he just called it, quote, "the craziest thing in the world."
(BEGIN VIDEO CLIP)
BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES: Look, the Affordable Health Care Act did a world of good and the 50-something efforts to repeal it that the Republicans have staged were a terrible mistake. We for the first time in our history, at least we are providing insurance to more than 90 percent of our people. But there is a group of people, mostly small business owners and people who make just a little too much money to qualify for Medicaid expansion or for the tax incentives, who can't get affordable health insurance premiums in a lot of places.
(END VIDEO CLIP)
BALDWIN: Now, to be clear, he's trying to walk it back now, essentially saying it's a great program, it's one that he, quote, "strongly supported," but he was simply saying there are still areas that need help.
Let's chat about that. Hilary Rosen is with me, CNN political commentator, Democratic strategist and Hillary Clinton supporter; and Betsy McCaughey is with us as well, Trump supporter and former lieutenant governor of New York.
Ladies, great to have both of you back.
(CROSSTALK)
[14:50:16] BETSY MCCAUGHEY, FORMER NEW YORK STATE LIEUTENANT GOVERNOR: Those kids behind President Clinton looked bored at the conversation.
(LAUGHTER)
BALDWIN: Yeah, a little bit. Well, you know, you know.
(CROSSTALK)
BALDWIN: I know.
But let's begin with -- listen, I talked to Hillary, and I'm sure you'll agree Hillary Clinton has said we need Obamacare improvements, elect me, it's signature piece of legislation from a man I so respect that I can make it better.
My question to you is, is the damage already done? I have to imagine Republicans are already creating attack ads.
(CROSSTALK)
MCCAUGHEY: May I take that?
BALDWIN: No, this is for Hilary.
HILLARY ROSEN, CNN POLITICAL COMMENTATOR: President Clinton is at fault for some exaggerated honesty here, I don't think it's the end of the world. The fact is that those subsidies would have been better and health care would be more affordable if the Republicans weren't blocking significant portions of the program over the years. So there's no question that it can be made better and there's no question that health care costs were rising significantly before the Affordable Care Act was put in place and theorizing less significantly now but still rising because that's the nature of health care costs which is still a problem that the Affordable Care Act never promised to fix. But more people are ensured. Donald Trump has promised to repeal this without substituting any other plan. So, you know, push comes to shove, people have to decide, do they want to make an imperfect plan better or do they want to risk giving their insurance back entirely to the private sector the way Donald Trump and the Republicans would? I think people will choose not to.
BALDWIN: Let's get to the other side.
Lieutenant Governor, your turn.
MCCAUGHEY: On day one, the next president of the United States should suspend the penalty on those who don't have insurance. Right now, Brooke, more people are incurring the penalty than have signed up for Obamacare. That's amazing. More people are incurring the penalty, about 12 million people --
(CROSSTALK)
BALDWIN: Is that true, Hilary?
ROSEN: No.
MCCAUGHEY: Yes.
May I continue?
I can back up those numbers. In fact, they were in the "Washington Beacon" just yesterday.
Let me point out the reason is the ACA promised affordability and choice and delivered neither. And the next president has the power under Section 5,000 of the law, the hardship exemption, to suspend the penalty on everyone until Congress can repeal the law. I suspect that's what a President Trump would do.
BALDWIN: Let me jump in because I know, Hilary, you want to respond.
(CROSSTALK)
MCCAUGHEY: The penalty is by the way --
(CROSSTALK)
MCCAUGHEY: -- $1,000 a person, $2,000 per household. That's the average according to the Kaiser Health Foundation.
BALDWIN: Let's listen to Donald Trump and his response to what President Clinton said. Here he was.
(BEGIN VIDEO CLIP)
DONALD TRUMP, (R), PRESIDENTIAL CANDIDATE: President Bill Clinton came out and told the truth about Obamacare. This was yesterday. He's absolutely trashed President Obama's signature legislation. In the meantime, she wants to double down on Obamacare. I'll bet he went through hell last night. Can you imagine what he went through after making that statement? He went through hell. But honestly, there have been many nights when he's gone through hell with Hillary.
(END VIDEO CLIP) BALDWIN: And, Lieutenant Governor, it's the last little thing there. Those comments from President Clinton, it's red meat for you and your party.
(CROSSTALK)
MCCAUGHEY: That's Donald Trump's New York sense of humor, and I wouldn't make any more of.
BALDWIN: I don't think everyone's laughing.
(CROSSTALK)
BALDWIN: I don't think anyone's laughing. Why did he have to go there?
MCCAUGHEY: Well, I thought it was very funny.
Let me point out the real issue here is that there are right now between 11 and 12 million people in the United States who are incurring a penalty for not having insurance. It's $1,000 a person this year, over $2,000 per average household, according to the Kaiser Health Foundation. They shouldn't have to pay that penalty when there is no choice and the law has not provided by affordable health insurance. And a Donald Trump presidency will act quickly to remedy that situation. Those penalties are unfair and more people are incurring the penalty than are actually signed up for Obamacare's plans.
BALDWIN: Hilary?
ROSEN: First of all, the penalty exists to encourage people to sign up because the more people that are in the pool, the cheaper care is across the board, than there are itself, and that's a critical point. In state after state after state, people have competitive choices for health care that they did not have before. So more than 20 million more people have health care, too, because of the Affordable Care Act than before the act was passed.
(CROSSTALK)
[14:55:10] MCCAUGHEY: But most are on Medicaid. That's where the real expansion is, not these defective Obamacare plans.
ROSEN: Here's the real big picture issue, which is, do you want a president who has a plan to fix health care, to make it better, to encourage more support for more small business, to encourage more competition in the system, or do you want a president who wants to throw you back to the wolves of the prosecute system? That's what Donald Trump has promised by repealing Obamacare.
(CROSSTALK)
HILARY: So I thought last night was useful for this reason, Brooke. Because for the first time I think in a few weeks we actually had a policy debate more than we've had to date. We've had differences on women's reproductive health, differences on climate change, on Syrian refugees, differences on LGBT rights. This is really what this campaign ought to come down to. And if it does, I think we'll see a majority of Americans are going to see that Donald Trump's plans are really very dogmatic right wing Republican proposals and Hillary Clinton has a little more of the center of the country in mind here.
MCCAUGHEY: Let me point out, Brooke --
(CROSSTALK)
BALDWIN: Well, they have another chance.
(CROSSTALK)
BALDWIN: Sorry, sorry, Betsy, we have to go, we have to go.
(CROSSTALK)
BALDWIN: Hopefully, they'll have a substantive debate on in St. Louis on Sunday.
Thank you, ladies, very much.
We have to get to this breaking news here. We're watching very closely this Hurricane Matthew. Evacuations are under way in Florida and along the east coast. Hurricane Matthew is heading straight towards the United States. We have an update on that. Stay with me.
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