Donald Trump, the No-Bid President

The trouble with competitive bidding is that it gets in the way of corruption. Our president knows how to solve that.

When I build a building, I let various builders and architects compete for the contract. Why? Because it sharpens their game, makes them bid competitively on price, and encourages them to give me the best quality product possible.—Donald Trump, Time to Get Tough: Making America #1 Again, 2011

When I build a building, I let various builders and architects compete for the contract. Why? Because it sharpens their game, makes them bid competitively on price, and encourages them to give me the best quality product possible.

—Donald Trump, Time to Get Tough: Making America #1 Again, 2011

As a real estate developer, Donald Trump would routinely put contracts out to bid to get the highest possible quality at the lowest possible price. This is, of course, a common practice in business. You send out a request for proposal, contractors submit bids, then you choose whichever bid looks most attractive.

Alas, Trump’s next step was often to ignore contractor invoices, leaving these poor saps no way to recover their costs except by filing an expensive lawsuit. Roy Cohn taught Trump that rich-jerk bullying technique. In 2016, USA Today identified at least 60 such contractor lawsuits, including a few brought by the same law firms Trump had earlier hired to fend off stiffed painters, stiffed carpet companies, stiffed real estate brokers, et cetera. Trump’s attitude was that his contractors should work free of charge. “Do you know how much publicity these people get for having me as a client?” Trump would say, according to Maggie Haberman’s 2022 Trump biography, Confidence Man.

The president’s past abuse of contractors does not discredit his past preference for competitive bidding. It’s a sound, sensible way to get value for your money. If you’re a homeowner, you’ve probably done some version of it yourself before undertaking some pricey renovation like replacing a roof or furnace.

Competitive bidding is even more common in government. That’s because when the money to buy goods or services doesn’t come out of the buyer’s pocket, it creates what economists call moral hazard. Competitive bids help overcome moral hazard by making the contracting process more objective and transparent. By one estimate, 97 percent of government contracts are put out to open bid. On those rare occasions when exceptions are made, it’s usually because either speed is of the essence or some extremely rare expertise is required.

Regrettably, to about the same degree Trump favored competitive bidding as a real estate tycoon, he disfavors it as president of the United States. That’s partly because Trump lacks the necessary patience, but mostly it’s because he lacks the necessary honesty. The man never met a moral hazard he didn’t like. Donald Trump will be remembered as (among other things) America’s No-Bid........

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