Trump University’s Checkered Past Haunts Trump

NY TIMES

The now-defunct Trump University, the subject of one of Marco Rubio’s attacks on Donald J. Trump at the Republican presidential debate Thursday night, was not a real university at all but a series of seminars held in hotels across the country that promised to share Mr. Trump’s real estate investing acumen with students. It is still embroiled in lawsuits accusing it of misrepresentation.

Those who ultimately purchased premium packages paid as much as $35,000 for the privilege of additional training, called mentorships and apprenticeships.

“Seventy-six percent of the world’s millionaires made their fortunes in real estate,” Mr. Trump said in an email marketing blast sent to tens of thousands of potential customers. “Now it’s your turn. My father did it, I did it, and now I’m ready to teach you how to do it.”

As many as 7,000 people across the country bought the sales pitch, spending an estimated $40 million. Both the State of New York and many of the students are now suing Mr. Trump for misrepresentation. Three cases are pending: one in New York brought by the attorney general and two in California, certified as class actions.

Defending the venture at the debate, Mr. Trump said, “They actually did a very good job, and I’ve won most of the lawsuits.” The remark came after Mr. Rubio accused Trump University of being a fake school.

“There are people that borrowed $36,000 to go to Trump University, and they’re suing him now,” Mr. Rubio said. “And you know what they got? They got to take a picture with a cardboard cutout of Donald Trump.”

In fact, the cases against Mr. Trump have not been resolved. One of those that remains pending was filed in 2013 by the New York State attorney general, Eric T. Schneiderman. It accuses Trump University of running a “bait and switch” scheme and said widely distributed advertisements for the program were replete with false claims.

A.G. Schneiderman Sues Donald Trump, Trump University & Michael Sexton For Defrauding Consumers Out Of $40 Million With Sham "University"

One ad published at least 170 times across the country in 2009, according to Mr. Schneiderman’s office, promised that students would “learn from Donald Trump’s handpicked instructors, and that participants would have access to Trump’s real estate ‘secrets.’ ”

But an investigation by Mr. Schneiderman’s office found that Mr. Trump had little to do with picking instructors at the seminars or developing the curriculums for the seminars, which were run largely by people with motivational speaking backgrounds who were compensated based on how many people they persuaded to buy additional seminars. One of them was a manager at Buffalo Wild Wings.

The inquiry also found that the curriculums were developed largely by a private company that makes materials for seminar companies and motivational speakers, including companies that sell time shares.

Trump University was founded in 2004, beginning as an online operation, after a Rye, N.Y., businessman, Michael Sexton, approached Mr. Trump with the idea. After an initial investment by Mr. Trump of about $2 million, the business was based in the Trump Building, at 40 Wall Street in Manhattan. According to the attorney general’s office, the day-to-day operations were directly managed by the Trump Organization and its affiliates.

As early as 2005, the New York State Department of Education warned Trump University that it was operating an unlicensed educational institution in violation of state law, according to the inquiry. In 2010, after several years of back-and-forth with the department, Trump University’s name was changed to the Trump Entrepreneur Initiative.

The marketing plan remained the same, however, beginning with a pitch to attend what was called a free 90-minute seminar to learn how to make money in real estate. In reality, the 90-minute seminar was a sales pitch to attend a three-day seminar costing $1,495, the investigation found.

The instructors tried to persuade students to purchase the three-day seminar with unrealistic predictions of their success, the attorney general says. In some seminars, students were told that if they signed up for the three-day seminar, they could earn six-figure incomes within a year working five to seven hours a week. The speaker repeatedly implied that Mr. Trump would show up for the three-day seminar, saying he “often drops by” and “might show up” and “you never know when he might show up.”

At the three-day program, students were told they could go to the next level by signing up for the Elite mentorship and apprenticeship programs for additional costs of up to $35,000.

One woman from Schoharie, N.Y., who was caring for a son with Down syndrome said she had attended the three-day program at a hotel in Malta, N.Y. The woman, Kathleen Meese, said she had been pulled aside and told she would make money faster if she signed up for the Gold Elite program, a mentorship, for $25,000.

When Ms. Meese said she had a credit card with a $30,000 limit but could not spend it on the program, she recounted, she was told by a Trump University trainer that “I had to find the resources to invest in my future.” She was promised that she would make the money back within 60 days, she said.

But the mentorship involved visiting a few rental properties.

“I was unable to get my refund and am still paying off debts from my Trump tuition,” Ms. Meese wrote in an affidavit in the attorney general’s suit.

During the three-day seminar, she said, participants were told they would have their photos taken with Mr. Trump.

“It ended up being a cardboard cutout of Mr. Trump,” she wrote.

IN LAST CHANCE DEBATE , RUBIO AND CRUZ SCORE AGAINST TRUMP.

NY TIMES

Senator Marco Rubio, alarmed by Donald J. Trump’s ascendancy and worried that his presidential chances were slipping away, unleashed a barrage of attacks on the real estate mogul’s business ethics, hiring practices and financial achievements in Thursday’s debate, forcefully delivering the onslaught that Republican leaders had desperately awaited.

In a series of acid exchanges, a newly pugnacious Mr. Rubio, long mocked for a robotic and restrained style, interrupted Mr. Trump, quizzed him, impersonated him, shouted over him and left him looking unsettled. It was an unfamiliar reversal of roles for the front-runner, who found himself so frequently the target of assaults from Mr. Rubio and Senator Ted Cruz that he complained they must have been a ploy for better television ratings.

From the opening moments of the debate, Mr. Rubio pounced. Deploying his own up-by-the-bootstraps biography, the Florida senator assailed Mr. Trump for hiring hundreds of foreign workers at his tony resort in Florida and passing over Americans who had applied for the same jobs.

Donald J. Trump’s Mar-a-Lago Club in Palm Beach, Fla. CreditRyan Stone for The New York Times

The acerbic and urgent tenor of the exchanges reflected the panicked state of a Republican field determined to halt Mr. Trump, whose crudely freewheeling style, abundant self-assuredness and durable popularity have produced three consecutive early-state victories that threaten to put the nomination out of reach for his two biggest rivals, Mr. Rubio and Mr. Cruz.

The two-hour rumpus frequently devolved into unmediated bouts of shouting, name-calling and pleas to the moderators for chances to respond to the latest insult....But amid the relentless back and forth, a question hovered: Was it too late?

Given the intractability of Mr. Trump’s support and the cruel mathematics of capturing the nomination, it was unclear whether his shakiness in the debate would blunt his momentum, especially with his impressive lead in several key states that will vote over the next few days.

But for a single night, it seemed, the dynamic among the candidates shifted, not only because Mr. Trump appeared off-balance at times, but because his rivals seemed looser, more comfortable and even delighted to take him on. Mr. Rubio smiled as he issued biting dissections of the less savory chapters of Mr. Trump’s business history and even questioned the very essence of Mr. Trump’s success story, saying he was simply the heir to a vast fortune.

“If he hadn’t inherited $200 million, you know where Donald Trump would be right now? Selling watches in Manhattan?” Mr. Rubio said, as the audience erupted in laughter.

“That is so wrong,” Mr. Trump said, plaintively.

When, at another point, Mr. Trump said that Mr. Rubio did not know “anything about business,” the senator responded: “I don’t know anything about bankrupting four companies,” an allusion to Mr. Trump’s liberal use of bankruptcy protections over the years.

Trump’s Romp in Nevada Shows Conventional Wisdom About His Ceiling May be Wrong.

Jabin Botsford, Washington Post

WASHINGTON POST DAILY 202

-- The returns from last night’s Nevada caucuses cast doubt on three assumptions that are widely held and often repeated by Republican elites in Washington, who are perhaps too eager to assure one another that Donald Trump still cannot actually win the nomination.

The first is that Trump has a relatively low ceiling of support. With 100 percent of precincts reporting, Trump won the Silver State with 46 percent. He beat Marco Rubio by 22 points. Ted Cruz finished a close third with 21.4 percent. As the Washington Examiner’s Byron York writes, “If he has a ceiling, at least in Nevada, it is higher than earlier thought.”

The second is that Trump will ultimately be hobbled by a lack of organization. Trump's rivals had built impressive ground games and his own supporters tend to be lower-propensity voters. Trump’s people proved last night that they will show up for caucuses.

The third is that, as the field of candidates condenses, every voter who is not currently for Trump will fall in line behind whoever emerges as his alternative. Many of Cruz’s voters actually look a lot like Trump voters demographically and ideologically. It should not be treated as a given that Cruz supporters would automatically move to Rubio if it becomes a two-man race. It stands to reason that many backing the Texan might prefer Trump over the other Cuban American senator, who continues to be dogged by his role in the Gang of Eight immigration bill.

The staggering breadth and depth of his victory suggests that the billionaire is poised to win big when 11 states vote next Tuesday.

According to preliminary network entrance polls, he won every single demographic. He carried men by 24 points and women by 18 points. He won those who describe themselves as very conservative, somewhat conservative and moderate. Just as in South Carolina, he bested Cruz among born-again evangelicals. The polling showed that he even won among Hispanics.

Trump is really tapping into the pervasive anger of the Republican base. Six in 10 of those who voted last night said that describes their feeling about the federal government. (36 percent said "dissatisfied," and only 4 percent picked "satisfied" or "enthusiastic.") Trump got half of the voters who called themselves angry, twice as much as Cruz.

Half of voters last night had a college degree. He beat Rubio 41-30 among this group. Among those without a college degree, he led Cruz 51-22. In his victory speech, he boasted: "We won with highly educated. We won with poorly educated. I love the poorly educated! We're the smartest people."

Ricky Carioti, Washington Post

There is no sugarcoating it: Cruz was the biggest loser last night.Our reporter on the Cruz beat, Katie Zezima, reports this morning thatTed Cruz’s presidential bid is in turmoil after repeated allegations of unsavory campaign tactics by his Republican rivals, leading some key supporters to call for a shake-up in the candidate’s message and strategy a week ahead of the crucial Super Tuesday primaries.

Aides and allies of the insurgent senator from Texas acknowledged in interviews this week that the campaign has been damaged by attacks on Cruz’s integrity from Donald Trump and Marco Rubio. They have pointed to a series of questionable tactics by the Cruz camp, including calls to voters suggesting that candidate Ben Carson was dropping out and the sharing of an inaccurate video suggesting Rubio had disparaged the Bible. 

-- The Texas primary next Tuesday now becomes either Cruz’s Alamo or his Waterloo, depending on what happens. A Texas Tribune/University of Texas poll published yesterday showed Cruz leading Trump there by 8 points, 37-29, with Rubio at 15 percent. 

Republicans’ Last-Ditch Hope To Stop Donald Trump

FIVETHIRTYEIGHT

If it’s not obvious by now, a ship called the Republican Party is perilously close to being hijacked by a populist pirate named Donald Trump. At the last three ports of call — New Hampshire, South Carolina and Nevada — Trump overpowered his rivals, even capturing all 50 of the Palmetto State’s delegates. Armed with a blue-collar following, Trump could continue to win majorities of delegates without winning majorities of voters, and if he does, he could become unstoppable in as soon as three weeks.

Yet there is still a possibility, albeit a narrowing one, that Marco Rubio could turn the tide and ultimately win more delegates than Trump — even if he wins fewer overall primary votes.

Rubio’s increasingly tenuous path depends on his ability to win a series of winner-take-all states with high proportions of white-collar, college-educated Republicans, most critically his home state of Florida on March 15.  [Where Fivethirtyeight's own analysis shows Rubio behind Trump at present--Esco.]. 

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Rubio might hope to win large delegate margins with relatively small raw vote margins, while Trump wins far more votes elsewhere but reaps more modest delegate payoffs — raising the prospect of an unusual split votes/delegates verdict enabled by the GOP’s uneven delegate allocation rules. However, to move beyond wishful thinking and achieve such tactical victories, Rubio will need to consolidate much more of the non-Trump vote and rapidly grow his support in Democratic-leaning areas in an extremely compressed window of time. That’s a tall order, but it may be GOP leaders’ last hope to stop Trump, who clearly has the best chance of winning the nomination outright by the final primaries in June.

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After March 1, 52 percent of Republican delegates will be awarded on a winner-take-all basis, keeping alive the possibility that a large early Trump delegate lead could be erased quickly by modest losses later. March 15 is truly the GOP’s “day of reckoning,” and Florida may be the most pivotal state on the entire calendar.... if Rubio wins over enough of Jeb Bush’s old supporters to claim Florida’s 99-delegate jackpot, it could mark a long-awaited turning point in the race. At the very least, he could leverage such an outcome to try to prevent Trump from winning a majority of delegates by June.

The continued candidacies of Cruz, Ben Carson and Kasich are of great significance even if none of them any longer have a credible path to the nomination. The more delegates they siphon off on Super Tuesday and beyond, the greater the odds neither Rubio nor Trump racks up 1,237 delegates by June, raising the prospect of a multi-ballot Cleveland convention in July.

And what could possibly compound the chaos of a contested convention? Just imagine a convoluted scenario in which Trump winds up with fewer delegates than Rubio despite having won the most votes heading into a contested convention, while Cruz and Kasich delegates are the ultimate arbiters of the nomination on a second or third ballot. Cue an angry press conference at which a red-faced Trump accuses the Republican National Committee of fixing the rules against him and thwarting the will of GOP voters. But the RNC’s rules predate Trump’s rise, and they may be party leaders’ only hope of averting a likely Trump shipwreck in November. [But, in such a scenario, do not rule out Trump opting to run as an Independent.-Esco]

NY TIMES

OTHER LAST CHANCE SCENARIOS:

Billionaires get into the game

Top Republican donors have shied away from confronting Mr. Trump, but at some point the party’s bankrollers may get serious about saving it from a man they view as a catastrophe. If they did, this could represent a serious threat to Mr. Trump. Imagine tens of millions of dollars in attack ads blanketing the landscape of primary states.

Debates turn disastrous

The stage may get even tougher for him starting Thursday night in Houston: He can no longer count on a large field of opponents to shield him from a formidable puncher like Mr. Cruz, or from Mr. Rubio, who is also seeking to break through.

His own worst enemy

Republicans have bet for months that Mr. Trump would destroy his own campaign through sheer intemperance or incompetence. So far, they have been disappointed.

But just because Mr. Trump has not yet paid a price for his lack of discipline does not mean he never will. A monumental blunder could be much costlier now than it would have been earlier in the race. For many Republican leaders, the question is whether Mr. Trump’s eventual self-immolation comes before he wins the nomination, or in November.

WILL HE OR WONT HE GO ALL THE WAY? AND ARE HIS RIVALS ANY BETTER?

NATE SILVER, FIVETHIRTYEIGHT

If you think the arguments between the Republican candidates have been bad, well, you ain’t seen nothing yet. Pundits, reporters and political analysts are going to really have at it. Two competing theories about the Republican race are about to come to a head, and both of them can claim a victory of sorts after South Carolina.

The first theory is simple. It can be summarized in one word: Trump! The more detailed version would argue the following:

• Trump has easily won two of the first three states.
• Trump is ahead in the polls in pretty much every remaining state.
• Trump is ahead in delegates — in fact, he may win all 50 delegates from South Carolina.
• Trump has been extremely resilient despite pundits constantly predicting his demise.¹ He’s been at 35 percent in national polls for months now. That’s as steady as it gets!
• So, um, isn’t it obvious that Trump is going to be the Republican nominee?
• 
• Not so, say the Trump skeptics. Their case is pretty simple also:
• • Trump is winning states, but he’s only getting about one-third of the vote.
  • Trump has a relatively low ceiling on his support.
  • Trump now has a chief rival: Florida senator Marco Rubio.
  What did the Trump skeptics find to like about South Carolina? Quite a lot, actually. They’d point out that Trump faded down the stretch run, getting 32 percent of the vote after initially polling at about 36 percent after New Hampshire, because of his continuing struggles with late-deciding voters. They’d note that Trump’s numbers worsened from New Hampshire to South Carolina despite several candidates having dropped out. They’d say that Rubio, who went from 11 percent in South Carolina polls before Iowa² to 22 percent of the vote on Saturday night, had a pretty good night. They’d also say that Rubio will be helped by Jeb Bush dropping out, even if it had already become clear that Rubio was the preferred choice of Republican Party “elites.”
• 
• 
  
• So what?” sayeth the Trump optimists. Second place means you’re a loser! There’s no guarantee that the other candidates will drop out any time soon. And as Trump himself has argued, it’s a mistake to assume that all of the support from Bush and other candidates will wind up in Rubio’s column. Some of it will go to Trump! 
• I should note that the Trump skeptics find the Trump optimists a bit exasperating on this point. (Why are you talking about yourself in the third person, Nate?) The idea that Trump has a ceiling — or to be more precise, will encounter a lot of upward resistance as he seeks to gain more support — is not some type of special pleading. Instead, it’s a point the Trump skeptics have raised from the very earliest stages of Trump’s campaign. And they’ve seen some evidence to validate it from Iowa, New Hampshire and South Carolina, along with recent polling.

• A reasonable person might adjudicate the case as follows: Yes, if the Republican nomination becomes a two-man race between Trump and Rubio, it could be pretty close. But that might not happen, or it at least might not happen for a while, not until Trump is off to a pretty big head start in delegates. What happens in a three-way race between Trump, Rubio and Cruz is a little murky. This reasonable person would concede that Rubio had a chance. But who’s the favorite? Trump!
  The Trump skeptics might bring up one last line of argument. They’d claim,perhaps more tentatively than they did before, that GOP elites still have some ability to influence the race. Maybe voters don’t care about what “the establishment” thinks, but individual Republican politicians can still have some influence — South Carolina Gov. Nikki Haley’s endorsement of Rubio very probably helped him, for instance. These elites have quite a bit of money to throw around, especially with Bush out. ...Or they could try to rule by brute force: If the Republican race goes to a contested convention, which is not at all unimaginable, we’re suddenly back in the pre-1972, smoke-filled-rooms era, although probably with  delegates vaping instead of puffing on cigars.
  Betting markets, weighing all of this information, see the Republican race thusly: Trump at about 50 percent to win the nomination, Rubio at 40 percent, and the rest of the field at 10 percent. I might quibble here and there, but that seems like basically a sound assessment. Now, let’s get back to arguing on Twitter.

• PAUL KRUGMAN, NY TIMES
• The thing is, one of the two men who may still have a good chance of becoming the Republican nominee is a scary character. His notions on foreign policy seem to boil down to the belief that America can bully everyone into doing its bidding, and that engaging in diplomacy is a sign of weakness. His ideas on domestic policy are deeply ignorant and irresponsible, and would be disastrous if put into effect.
  The other man, of course, has very peculiar hair.
• ----
• ....one shouldn’t treat establishment support as an indication that Mr. Rubio is moderate and sensible. On the contrary, not long ago someone holding his policy views would have been considered a fringe crank.
  Let me leave aside Mr. Rubio’s terrifying statements on foreign policy and his evident willingness to make a bonfire of civil liberties, and focus on what I know best, economics.
  You probably know that Mr. Rubio is proposing big tax cuts, and may know that among other things he proposes completely eliminating taxes on investment income — which would mean, for example, that Mitt Romney would end up owing precisely zero in federal taxes.
  What you may not know is that Mr. Rubio’s tax cuts would be almost twice as big as George W. Bush’s as a percentage of gross domestic product — despite the fact that federal debt is much higher than it was 15 years ago, and Republicans have spent the Obama years warning incessantly that budget deficits will destroy America, any day now.
  But not to worry: Mr. Rubio insists that his tax cuts would pay for themselves, by unleashing incredible economic growth. Never mind the complete absence of any evidence for this claim — in fact, the last two Democratic presidents, both of whom raised taxes on the rich, both presided over better private-sector job growth than Mr. Bush did (and that’s even if you leave out the catastrophe of Mr. Bush’s last year in office).
  Then there’s Mr. Rubio’s call for a balanced-budget amendment, which, aside from making no sense at the same time he is calling for budget-busting tax cuts, would have been catastrophic during the Great Recession.
  Finally, there’s monetary policy. Republicans have spent years inveighing against the Fed’s efforts to stave off economic disaster, warning again and again that runaway inflation is just around the corner — and being wrong all the way. But Mr. Rubio hasn’t changed his monetary tune at all, declaring a few days ago that it’s “not the Fed’s job to stimulate the economy” (although the law says that it is).
• 
• In short, Mr. Rubio is peddling crank economics. What’s interesting, however, is why. You see, he’s not pandering to ignorant voters; he’s pandering to an ignorant elite.
  Continue reading the main story

  
  

  Donald Trump’s rise has confirmed something polling data already suggested, namely, that most Republican voters don’t actually subscribe to much of the party’s official orthodoxy. Mr. Trump has said the unsayable on multiple issues, from declaring that we were deceived into war to calling for higher taxes on the wealthy (although his own plan does no such thing). Each time, party insiders have waited to see his campaign collapse as a result, and each time he has ended up paying no political price.
  So when Mr. Rubio genuflects at the altars of supply-side economics and hard money, he isn’t telling ordinary Republicans what they want to hear — by and large the party’s base couldn’t care less. He is, instead, pandering to the party’s elite, consisting mainly of big donors and the network of apparatchiks at think tanks, media organizations, and so on.
• 
• ----
• So don’t let anyone tell you that the Republican primary is a fight between a crazy guy and someone reasonable. It’s idiosyncratic, self-invented crankery versus establishment-approved crankery, and it’s not at all clear which is worse.
•