“I always felt that when the business cycle went down I’d never get caught,” a 44-year-old Donald Trump told Fortune’s Stratford Sherman in 1990. At the time, Trump—brash, proud, eminently entrepreneurial—had just secured millions from banks to avoid “a default that could have demolished his empire,” wrote Sherman. With three Atlantic City casinos, various pieces of New York real estate, and a mountain of debt that suddenly found itself without the cash to support it—the swaggering dealmaker from Queens had vastly overextended himself. Only an eleventh-hour deal with banks saved him. When Sherman asked Trump what he had learned in his brush with bankruptcy, the businessman offered the defiant words above. Edward Tracy, the head of Trump’s casino group, was even clearer in defining the Trump worldview: “You’re always going to get through the downside. The guys who win are the ones who bet on the upside.”
Do the cycles in Washington work the same way as those on Wall Street? That’s the question that Donald Trump is testing as 45th President of the United States. Sure, his approval ratings are at a record low and his influence on Capitol Hill is a mixed bag at best. But Trump’s greatest challenge to date—silencing accusations that members of his presidential campaign colluded with Russia to influence the election that placed him in office—remains as formidable as his boasts.
On Tuesday Trump abruptly dismissed James Comey, the director of the Federal Bureau of Investigation. The long-suffering public official first drew Democrats’ ire when he investigated party nominee Hillary Clinton during the 2016 campaign, then caused Republicans great irritation after the election by investigating the possibility of Trump campaign collusion with Russia. That Comey’s job security was at risk was hardly a surprise; he occupied a perilous position serving a president whose associates he was actively investigating. But Trump’s January decision to keep Comey, an Obama nominee, and his evident affinity for the FBI director at public events seemed to suggest that he was comfortable with the situation and at peace with his earlier criticisms that Comey, 56, had not acted forcefully enough in the Clinton investigation.
“While I greatly appreciate you informing me, on three separate occasions, that I am not under investigation, I nevertheless concur with the judgment of the Department of Justice that you are not able to effectively lead the bureau,” Trump wrote in a letter to Comey dated Tuesday, adding that he was acting on the recommendation of Attorney General Jeff Sessions and Deputy Attorney General Rod Rosenstein.
Trump’s dismissal of Comey this week is a stunning reversal, though not altogether unprecedented in its nature. Trump, 70, has never shied away from changing his mind or firing subordinates on a whim. (Indeed, Fortune on Trump in 1990: “The boss has always behaved like a brash entrepreneur: trusting his gut; charming his executives one minute, bellowing at them the next; second-guessing and often firing employees; suing his suppliers; making wild public statements; nagging the custodians who polish his brass.”) But his decision to do so while facing increasing scrutiny—the deepening FBI probe regarding his administration’s contact with Russia and damning new Senate testimony from former acting attorney general Sally Yates about Trump’s now-fired national security adviser Michael Flynn—instantly recalls Richard Nixon’s infamous “Saturday Night Massacre” in which the 37th president purged the Justice Department during the Watergate investigation. (The FBI is expected to continue its investigation without Comey. Democrats, meanwhile, are calling for an independent prosecutor.)
Three decades ago, Trump’s willingness to bet on the upside made him a survivor. As the winds of scandal swirl in Washington, it’s difficult to see where that inflection point might be.