The Donald’s failed gamble
A city facing bankruptcy has bad memories of promises that came to nothing.
The night of April 2, 1990 is one Tina Condos will never forget. It was the opening night of Donald Trump’s new US$1.1 billion Atlantic City casino, and Condos was working as a cocktail waitress serving drinks to Michael Jackson, Elle Macpherson and the other stars and socialites who had flown in for the big night.
Trump described the casino, lit by US$16 million worth of chandeliers and then the most expensive ever built, as the ‘‘eighth wonder of the world’’. The property tycoon now turned presidential candidate also promised it would transform the fortunes of the New Jersey coastal city.
His promise held true, for a brief period, but now his casino empire is a busted flush. The Taj is set to close, and Atlantic City teeters on the edge of bankruptcy.
The impact of the Taj’s closure will be worse for the city than Hurricane Sandy, the 2012 storm that all but washed away Atlantic City’s tourism business, says its mayor.
For a man who is running in large part on his business record and a promise to Make America Great Again, Trump’s foray into Atlantic City tells a cautionary tale.
‘‘Trump was like the second coming of Atlantic City,’’ Condos, 54, says near the nine carved marble elephants that line the entrance to the 42-storey Trump Taj Mahal casino and hotel. ‘‘This was going to be the great place to work. We were going to make a lot of money, we were going to have benefits, healthcare, we were going to be able to raise our children. It was going to be awesome.
‘‘And, you know what? It was. It was really, really awesome. I loved working for Trump back in the day.’’
Trump soon became the biggest employer in town, running three casinos, and the city was, as the Republican candidate put it recently, ‘‘a very good cash cow’’. But Trump, 70, has gone.
After stripping hundreds of millions of dollars in assets from his casinos in successive bankruptcies, all that’s left of Trump’s legacy is the forlorn and empty Trump Plaza and the downat-heel Taj, which is set to close its doors permanently on October 10.
Trump has scrubbed his name from the boarded-up Plaza, but it still shines brightly above the elephants at the entrance to the Taj at the eastern end of the boardwalk. He has no stake left in the casino, which was bought out of bankruptcy by his friend the billionaire investor Carl Icahn.
As part of the bankruptcy deal, the Taj workers were stripped of their healthcare, pensions, meal breaks and other benefits. About 1000 low-paid staff, including cleaners, cooks and waiting staff, including Condos, walked out on strike in July. The casino is still
Bob McDevitt, casino workers union president He basically sucked the life and the money and the fortune out.
operating, as dealers and security staff are not involved in the dispute.
Icahn, who is worth US$16.5b, according to Forbes, responded to the strike – the longest in Atlantic City casino history – by announcing the closure of the Taj and blaming the strikers for blocking its ‘‘path to profitability’’.
Bob McDevitt, president of the casino workers union Unite Here Local 54, says it was Icahn and Trump, not the workers, who plunged the Taj into crisis by sucking money out of the city during the good times and not investing in the future as Atlantic City faced intense competition from new casinos opening up across the northeastern US.
‘‘He basically sucked the life and the money and the fortune out of this property – it’s a dried-up husk, and the workers are left to deal with it [as] he goes on his merry way and goes on to run for president.’’
Trump hasn’t been shy about the money he has made in the city. ‘‘I made a lot of money in Atlantic City and left 7 years ago, great timing (as all know),’’ he said on Twitter last month.
More than 8000 jobs have been lost, and nearly 3000 more will go when the Taj closes, a devastating loss in the already struggling city.
Within the past five years the city’s tax revenues have fallen by 70 per cent, and Mayor Don Guardian has had to make severe cuts to the city’s budgets and employees’ pay to avoid a state takeover, just as Michigan did ahead of Detroit’s historic bankruptcy in 2013.
Guardian, an openly gay Republican with liberal values, says Trump did wonders for Atlantic City at the height of the casino boom and provided ‘‘a ton of jobs’’, but then pulled out when things started to get tough.
‘‘When ‘The Donald’ was here – you can talk to union representatives – this was a pretty fair guy. It was the workers that really made him. All those Mexican-American workers in Atlantic City that cleaned the rooms, that made the beds, that scrubbed the toilets, that cooked the food, they all worked very hard, got paid a reasonably good working salary and they made him and his companies very successful.
‘‘But what happened since? He didn’t invest,’’ Guardian says. ‘‘He took the money and went elsewhere.’’
Condos, the Taj cocktail waitress, recently lost her home in a foreclosure and is struggling to provide for her four children. ‘‘I’ve got to be honest with you, I loved working for Trump back in the day, and I like some of the things he stands for,’’ she says. ‘‘But we have been left with nothing.’’