President Donald Trump’s most iconic property is about to get a new tenant: the Department of Defense. According to CNN, the Pentagon, hewing to a longstanding policy of establishing an offshoot headquarters near the president’s private, non-White House residence, is planning to lease space in Trump Tower in New York City to maintain close proximity to Trump should he choose to spend time there instead of Washington, D.C..
The Department of Defense’s decision is yet another example of how Trump’s decision to hold onto his business interests is rewriting norms surrounding the presidency and creating problems in what were once uncontroversial procedures. As mentioned above, the Department of Defense’s decision is not unique to Trump’s presidency: They took up residence in Chicago, for example, during Barack Obama’s two terms for the exact same reason.
The difference, as is true in so many of the stories surrounding Trump and his family’s conflicts of interest—the Red Cross’s decision to hold its annual ball at Mar-a-Lago, for example, or Eric Trump’s business trip to Uruguay—is that the president himself is now making money off of routine governmental functions. Exactly how much money remains unknown, as the Department of Defense has yet to publicly state how much space they will be renting and for how long. However, details of the Secret Service’s decision to do the same are instructive as to the general scope of the bill. When that news first broke back in November 2016, the New York Post used publicly available information regarding rents at Trump Tower to deduce that, at a cost of up to $105 per square foot, the Secret Service’s decision to occupy two 3,000- to 5,000-square-foot floors of the building could cost taxpayers more than $3 million a year, a significant portion of which would be going to the Trump Organization, and, by extension, the president himself.
Just how much the DoD will be paying the Trump Organization for the privilege of working out of the president’s property is not the only outstanding question. Trump’s protestations to the contrary aside, scientific evidence shows that the mere knowledge that one has profited from a relationship in the past often leads to preferential behavior, which could lead Trump to favor the Pentagon in his decision-making. As a result, beyond the overarching problem of a government agency paying the president himself a large sum of money to set up shop in the president’s property, the Department of Defense’s decision to rent space in Trump Tower could have significant ramifications for how the Trump White House operates.
The Background
President Donald Trump still has not taken the necessary steps to distance himself from his businesses while in office. In accordance with a plan that he and one of his lawyers, Sheri Dillon, laid out at a press conference on January 11, Trump has filed paperwork to remove himself from the day-to-day operation of his eponymous organization. However, numerous ethics experts have voiced strenuous objections to the plan, which they say does very little to resolve the issue: As long as Trump continues to profit from his business empire—which he does whether or not he is nominally in charge—they say, the possibility that outside actors will attempt to affect his policies by plumping up his pocketbook will remain very much in play.
This week, some of Trump’s critics moved forward with legal action. The watchdog group Citizens for Responsibility and Ethics in Washington, or CREW, filed a lawsuit alleging that Trump’s business holdings violate the Emoluments Clause of the Constitution, which makes it illegal for government officials to “accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince, or foreign State.” CREW’s bipartisan legal team includes, among others, Norm Eisen and Richard Painter, who served as ethics lawyers under Presidents Obama and George W. Bush, respectively; Laurence Tribe, a constitutional law professor at Harvard University; and Zephyr Teachout, a professor at Fordham University (and former congressional candidate) who is considered an authority on the Emoluments Clause. All have been vocally critical of Trump’s continued refusal to sell off his business, and are now taking their case to court to argue that several of Trump’s businesses present avenues by which foreign governments could seek to influence the president by, for example, booking stays at one of his hotels or renting space at one of his properties. Additionally, the lawsuit seeks to force Trump to reveal his tax returns, something every president has done since Gerald Ford but which Trump has refused to do, significantly limiting the public’s ability to understand the president’s finances. When asked about the lawsuit, Trump described it as “totally without merit.” Eisen was quick to respond on Twitter, offering to “debate Trump (or his chosen champion) on the merits of our case anytime,” making it clear that CREW intends to continue to pursue its case. (CREW has also filed a separate complaint to the General Services Administration arguing that Trump has violated the lease on his Washington, D.C. hotel, which states that “no … elected official of the Government of the United States … shall be admitted to any share or part of this Lease, or to any benefit that may arise therefrom.”)
Though CREW is the first group to bring a lawsuit against President Trump, it may soon have company. According to The New York Times, Anthony Romero, the executive director of the American Civil Liberties Union, has said that his organization is looking for a plaintiff to sue Trump for violating the Emoluments Clause, although with a different claim to legal standing: While CREW intends to demonstrate that the group itself has suffered financial harm because the need to focus on the Emoluments Clause has diverted its resources away from other worthy causes, the ACLU is hoping to find a hotel or bed-and-breakfast owner that can prove he or she has lost business to one of Trump’s hotels during his presidency.
CREW’s lawsuit is just the latest development in what promises to be a continuing saga regarding Trump’s many conflicts of interest that began almost as soon as he won the presidency. Along with his unprecedented wealth, Trump brings to the office unique and gravely concerning entanglements that, whether he recognizes their effects or not, threaten to undermine his decision-making as president. The plan Trump and Dillon announced on January 11 would do very little to resolve the conflicts: It places control of his assets in the hands of his two adult sons and a longtime associate of their father’s with what so far amounts to a pinky-swear assurance that, despite their proximity to the president, they will not discuss any aspect of the business with him. On top of that, the plan supposedly would terminate several of the Trump Organization’s pending deals and place a ban on new foreign deals, two conditions undermined by the announcement that the organization would be moving forward with expanding its golf course in Aberdeen, Scotland.
Even before his most recent plan was laid out, Trump has attempted to deflect criticism by repeatedly asserting that the law barring executive-branch officials from maintaining financial holdings or business ties that overlap with their duties does not apply to the president or vice president. In this, he is correct; the law, passed in 1989, exempts the two chief executives from conflict-of-interest rules on the understanding that their purview is so broad that it would be impossible for them to completely disentangle themselves.
Regardless, legality does not imply propriety. Unless Trump acts to put actual distance between himself and his business ventures, these questions are likely to continue throughout his time in the Oval Office. On top of the aforementioned legal actions, the director of the Office of Government Ethics, Walter Shaub, has declared Trump’s efforts insufficient, remarking, “I don’t think divestiture is too high of a price to pay to be the president of the United States,” and a number of Senate Democrats have introduced legislation that would force Trump to divest or face impeachment. Below is an attempt to catalogue the more clear-cut examples of conflicts of interest that have emerged so far. The most recent entries appear at the top:
That Red Cross Ball
That D.C. Labor Dispute
That Estate in Palm Beach
Those Expansion Plans
That Hotel in Vancouver
That Reality-Television Show
That Pipeline
Those HUD Grants
That Golf Course in Aberdeen
That Other Billionaire New York Real-Estate Developer
Those Indonesian Politicians
That Emirati Businessman
That Virginia Vineyard
That Las Vegas Labor Dispute
That Kuwaiti Event
Those Certificates of Divestiture
That Carrier Deal
That Blind-Trust Issue
Those Fannie and Freddie Investments
That Phone Call With Taiwan
That Deutsche Bank Debt
That Secret Service Detail
That Property in Georgia (the Country)
That Phone Call With Erdogan
That Hotel in Washington, D.C.
That Argentinian Office Building
Those Companies in Saudi Arabia
That British Wind Farm
Those Indian Business Partners
That Envoy From the Philippines
That Red Cross Ball
The web of President Donald Trump’s conflicts of interest has grown to encompass the American Red Cross, which held its annual ball on Saturday, February 4, at Trump’s Mar-a-Lago Club in Palm Beach, Florida. By hosting the ball, the Trump Organization accepted money from an organization that, while not a federal agency per se, is subject to federal oversight that at some point in the next four years will likely involve President Trump.
Unlike a number of the events at Trump properties that have been featured in this list of Trump’s conflicts of interest, the Red Cross Ball, which celebrated the organization’s centennial anniversary, appears to have been scheduled before Trump even received the Republican nomination for president; a calendar listing on the website of the Coastal Star, a local newspaper covering events in the Palm Beach area, is recorded as having been placed in April 2016. Additionally, though the event has been held elsewhere in the past, this was not the first time it has taken place at Mar-a-Lago: Not only was last year’s ball held there, but the very first Red Cross Ball was hosted there by the property’s prior owner, the famous socialite Marjorie Merriweather Post.
Given all that, there is no indication that the decision to hold the event at Mar-a-Lago had anything to do with Trump’s election, and the fact that Trump will likely be attending the event is not unusual—President Barack Obama also attended as the honorary chairman of the organization while in office. Nevertheless, the ball perfectly encapsulates why Trump’s continued refusal to relinquish his business interests complicates even situations that would have taken place had he not become president.
Thanks in part to the makeup of the Red Cross’s leadership and its unique relationship with the federal government, the ball creates a particularly complicated situation. According to its website, the Red Cross “is not a federal agency, nor [does it] receive federal funding on a regular basis to carry out our services and programs,” instead relying on donations and fees for services like health-and-safety training courses. However, the organization operates under a federal charter as a “federal instrumentality … to carry out responsibilities delegated to [it] by the federal government.” The best-known of these duties include overseeing blood-donation drives and disaster-relief efforts; according to its website, it is also the Red Cross’s duty “to fulfill the provisions of the Geneva Convention” and “provide family communications and other forms of support to the U.S. military.” Further, the organization has a chairperson appointed by the president; currently, the chairwoman is Bonnie McElveen-Hunter, who was appointed by President George W. Bush in 2004. The charter also periodically comes before Congress for review and amendments to be signed into effect by the president.
On multiple occasions in recent years, the Red Cross has come under scrutiny for how it handles its multi-billion-dollar budget, most of which comprises donations from the American public. Prompted in part by reporting on the organization’s inadequate response to Hurricane Sandy, misleading statements about how it uses its money, and a September 2015 report by the Governmental Accountability Office, two congresspeople—one Democrat and one Republican—have independently introduced measures to increase the organization’s transparency. Neither has been enacted, but there will likely be another push to improve the relationship between the federal government and the Red Cross during Trump’s presidency, whether via a review of the Red Cross’s charter, the need to appoint a new chairperson, or the introduction of reform-minded legislation. If and when Trump is called upon to weigh in on these decisions, he will be asked to do so having directly profited from the organization while in office, which could limit his ability to act in the best interests of the American people.
Back to table of contents
That D.C. Labor Dispute
One month before he took office, President Donald Trump managed to sidestep a potential conflict of interest at his hotel in Las Vegas. In the fall of 2015, several hundred employees at the city’s Trump International Hotel had voted to join the local branch of the Culinary Workers Union, only to find their efforts stalled by Trump and the hotel’s co-owner, Phil Ruffin. The case languished for more than a year until, after the National Labor Relations Board found Trump and Ruffin in violation of federal law, the workers successfully negotiated their first collectively-bargained contract. If this hadn’t been resolved, a conflict of interest would have arisen: The case would have gone to the U.S. Court of Appeals for the District of Columbia, to which Trump will soon be able to appoint members.
Now, the same issue is cropping up at the Trump International Hotel in Washington, D.C. Already a centerpiece of the controversy over the likely violation of the Constitution’s Emoluments Clause, the property may soon be the site of another legal tussle: According to The Washington Post, 40 workers at the hotel have also voted to unionize, the first group to do so at a Trump-owned establishment since his election.
As was true in Las Vegas, the push for unionization in D.C., if it’s met with resistance from the hotel, would create an opportunity for the president to place his own financial interests above those of the hotel’s workers. In Las Vegas, the dispute appears to have been resolved partly because of the NLRB’s intercession; if the Trump Organization similarly contests the case in D.C., the NLRB may once again be asked to weigh in. And now that Trump is president, he will be appointing new board members to fill two vacancies on the agency’s five-seat panel, which could very well tip it from its current left-leaning, labor-friendly composition to a more conservative, pro-owner bent. If, as in Las Vegas, the NLRB finds in favor of the workers, but the Trump Organization chooses to continue its opposition, there is a possibility that the case could come before a federal appeals court, where judges who Trump himself may have appointed will be asked to review the NLRB’s decision. And if the conflict continues even beyond the Court of Appeals, it will fall to the Supreme Court, to which Trump recently nominated Judge Neil Gorsuch, to render a final verdict. (It should be added that each appointee will be faced with the possibility of ruling against the financial interests of the infamously vindictive man to whom they owe their position.)
Appointing labor-unfriendly officials and justices might fairly be said to be in keeping with Trump’s long history of questionable labor practices, but this does not mean that the conflict-of-interest question will dissipate. It’s difficult, if not impossible, to determine how much his pro-business stances are dictated by a sincere belief in their efficacy rather than an understanding that he himself has benefited from them in the past and will likely continue to do so in the future. As such, Trump’s motivations will continue to occupy an ethical and legal gray area until he eliminates the overlap between his roles as a businessman and as president.
Back to table of contents
That Estate in Palm Beach
Even before President Donald Trump took office, Mar-a-Lago, his golf club in Palm Beach, Florida, was involved in instances of self-dealing that attracted scrutiny. During the presidential campaign, David Fahrenthold of The Washington Post discovered that Trump used donated funds to buy a $20,000 portrait of himself to reside at the resort and that he used foundation money to settle a lawsuit over the size of the his flag on the property. Then, on New Year’s Day, footage emerged from an event the previous evening at Mar-a-Lago in which Trump praised an Emirati business partner to the assembled crowd, seemingly confirming that those who have done business with the president in the past may receive preferential treatment in the future.
Now, it appears that Trump may be exploiting his new position to make more money off of the club. On January 25, NBC reported that the resort had doubled its initiation fee, from $100,000 to $200,000. The increase, which took effect on January 1, is the first change to the cost of admission since 2012, when, amid a decline in membership in the aftermath of the Bernie Madoff scandal (which affected a large number of Palm Beach residents), the club made the exact opposite decision, halving the fee from $200,000 to $100,000.
The increase drew widespread criticism due to the perception that Trump is using the presidency to pad his wallet. As Mar-a-Lago’s owner, Trump directly profits from any increase in revenues at the club. He has also designated it his “winter White House,” meaning there’s plenty of reason to believe that people will be willing to pony up the increased initiation fee for the chance to rub shoulders with him, whether that means an opportunity to actually talk to him about an issue or just for the chance that they’ll catch his eye and make a good impression.
On the surface, the situation appears similar to previous examples of access-selling; there’s a long history of wealthy citizens paying large sums of money to attend events where they may have a chance to bend a politician’s ear. What makes this case different is that, while such events usually benefit a charity or campaign, here, Trump himself will be the beneficiary.
Back to table of contents
Those Expansion Plans
Of the measures that President Donald Trump and his lawyer Sheri Dillon laid out at his January 11 press conference to address conflicts of interest, only two actually ameliorate any of the concerns critics have raised: the cancellation of all of the Trump Organization’s pending deals and the promise not to pursue expansion in other countries (although developments since the announcement suggest that those pledges leave plenty of wiggle room). Conveniently left out of the plan, however, is any prohibition on expanding holdings within the United States—which is apparently something that Trump Hotels plans on doing while Trump is in office.
On January 25, Bloomberg reported that Eric Danziger, the CEO of Trump Hotels, said after a panel discussion in Los Angeles that the company is considering tripling the number of Trump-branded properties within the U.S. According to Danziger, “There are 26 major metropolitan areas in the U.S., and we’re in five. I don’t see any reason that we couldn’t be in all of them eventually.” Danziger listed Dallas, Seattle, Denver, and San Francisco as among the cities where the Trump Organization is looking to build in the near future.
As the Trump Organization’s holdings expand, so too does the potential that business considerations will have undue effects on the president’s behavior in office, or at least appear to. Each location presents another opportunity for businesspeople or foreign dignitaries to choose to stay in a hotel in an attempt to burnish Trump’s opinion of them, their company, and/or their country. Each location increases the number of municipal governments with whom Trump will be interacting both as president and as the owner of a real-estate empire.
Trump Hotels’ expansion plans could put not only Trump but also the cities where new properties may be built in a difficult situation. San Francisco, for example, is currently experiencing a housing crisis, one possible solution to which would be to increase the pace of new home-construction projects, some of which could be funded by federal grants. On the one hand, it is almost certain that the residents of San Francisco, a city that voted against the president by roughly a 9-to-1 margin in November, would strenuously object to a new Trump-branded property in the city. But there is also an incentive for the city government to work with the Trump Organization in finding a suitable expansion plan. With plenty of evidence to suggest that collaborating with Trump’s businesses could influence the president, there’s added pressure for city officials to pursue a potentially costly project residents may otherwise not want in hopes of reaping the benefits down the road. Meanwhile, the officials in charge of doling out federal largesse such as housing grants may similarly feel pressure based on the knowledge that Trump’s feelings toward particular cities may change based on how receptive the locale was of his business’s expansion plans.
Finally, the Trump Organization’s announcement that it would be pursuing expansion further attests to just how little the president’s plan to mitigate his conflicts of interest actually accomplishes its goal. For the Trump Organization to not just expand but do so on such a large scale violates the professed spirit of the measures laid out on January 11 and defies any argument that the company will cease to act in a way that jeopardizes the president’s ability to do his job.
Back to table of contents
That Hotel in Vancouver
Less than a week into his administration, President Trump has a new property opening for business: the Trump International Hotel & Tower in Vancouver. According to The Washington Post, construction on the hotel finished shortly before Trump assumed office, with the building’s finishing touch—the president’s name spelled out in giant letters—revealed on January 19 (the day before the inauguration), and the first guests and permanent residents checking in on January 25.
As with many buildings bearing the president’s name, the new hotel in Vancouver is a licensing deal, with the Trump Organization leasing its branding to a third party—in this case, a real-estate company called the Holborn Group, which operates several luxury hotels throughout Canada. The Holborn Group is run by Joo Kim Tiah, the eldest son of one of the wealthiest families in Malaysia; several members of Tiah’s family are expected to fly in from Kuala Lumpur to attend the opening with the president’s two adult sons, Donald Jr. and Eric.
The building is yet another manifestation of the running problem posed by Trump’s extensive foreign real-estate holdings. Unless the president actually rids himself of his financial stake in his company, every Trump property influences his incentives when it comes to making policy, foreign or domestic: Should he act in the manner that best serves the country, or the one that will protect his profits? Every building provides the opportunity for third parties to curry favor with the infamously capricious president: If he knows that he has taken money from somebody, be it a company, a private individual, or agents of a foreign government, that knowledge, and the goodwill it creates, is likely to color Trump’s decision-making. Moreover, every businessperson who has a licensing deal with Trump now has leverage: If Tiah, or any of the other businesspeople around the world with a Trump-branded property, disagrees with a decision the president makes, he can threaten to pull out of the partnership and jeopardize some of Trump’s cash-flow in an attempt to change his mind.
Hardly a day had passed between the new hotel in Vancouver opening for business and the first report of an organization choosing to host an event at the site, possibly for political reasons. On January 26, The Washington Post reported that The American Chamber of Commerce in Canada, a business organization affiliated with the conservative U.S. Chamber of Commerce, had scrapped longstanding plans to hold a meeting about trade relations at the home of a diplomatic official and would instead be booking space in the new Trump Hotel for the equivalent of roughly $1,900—a relatively small sum, to be sure, but even small sums have been shown to substantially influence decision making. The change initially prompted at least one planned speaker, the University of British Columbia professor Matilde Bombardini, to back out of the event; however, according to the Vancouver Sun, she has since changed her mind after being told that the change of location was due to a leak at the previous site.
As with so many of the instances chronicled here, the venue change demonstrates how Trump’s conflicts of interest often operate in shades of grey. If the Chamber of Commerce did make its decision solely based on logistics, booking a spot in a Trump-branded building still makes possible the appearance of paying for play. In a marked departure from the Chamber’s copacetic relationship with the Republican nominee Mitt Romney in 2012, the aggressively free-market, pro-trade group clashed with the president on multiple occasions during the 2016 campaign over Trump’s protectionist trade policies, but has already made public overtures since the election to reconcile with the president. If it did, in fact, choose to move the event even in part because of the giant name on the new location’s facade, the decision represents another chapter in the ongoing saga of the business community’s desire to both please and sway a president whose ideology is not that of a typical Republican. Additionally, though nearly all of Trump’s rhetoric about NAFTA centers on Mexico, Canada actually trades more with the U.S. than not just Mexico but any other country in the world. As such, there is plenty incentive for the Canadian branch of the American Chamber of Commerce to do whatever it can to reach out to Trump.
Back to table of contents
That Reality-Television Show
Though President Donald Trump has been a well-known figure in American public life for decades, perhaps the single biggest contributor to his stardom has been NBC’s The Apprentice. Trump himself is no longer the star of the show—former California Governor Arnold Schwarzenegger has taken over as host in 2017—but the president remains an executive producer on the series for at least the coming year, including receiving a low five-figure salary for the position, according to Variety. Shortly after the news of that income broke, Kellyanne Conway, a counselor to Trump, clarified that he would be taking on his producing duties in his spare time, comparing the situation to previous presidents playing golf or pursuing other leisure activities.
Norm Eisen and Richard Painter, who served as the chief ethics lawyers under Presidents Obama and George W. Bush, respectively, pointed out on NPR’s Fresh Air that Trump’s ongoing involvement with The Apprentice presents yet another conflict of interest. According to AdWeek, 11 companies, including the television-shopping network QVC and Carnival Company (which operates the eponymous cruise line), are providing on-air sponsorships for the newest season of The Apprentice; a twelfth, the Japanese motorcycle company Kawasaki, withdrew from a previously reported deal after customers threatened a boycott because of its sponsorship of the show. All of these companies—plus the numerous companies that run ads during the show’s commercial breaks—are effectively putting money into the pockets of the president, not to mention supporting one of his products.
Trump apparently believes himself immune to such conflicts of interest, both in terms of legal impunity and his ability to ignore them, despite a good deal of research indicating that even minuscule financial incentives (minuscule for a billionaire, that is) can be enough to significantly influence behavior. Additionally, there is little doubt that Trump cares deeply about the ongoing success of The Apprentice: The weekend after the new Schwarzenegger-led season debuted, the then president-elect took to Twitter to voice his thoughts on the new season’s ratings. So when one of the companies that sponsors the show interacts with the executive branch—as when Carnival reached a $40 million settlement with the U.S. government over pollution in the Atlantic Ocean, for example, or when QVC settled a $7.5 million suit regarding deceptive advertising in 2009—the question will necessarily arise how their contributions to Trump’s pocketbook and beloved TV show will affect the outcome.
Even if Trump were able to fully blind himself to the conflicts described above, the president’s role would remain a problem because it provides an unprecedented bargaining chip for both the companies currently sponsoring in the show and those that could seek to use it to attempt to manipulate the president. Consider, for a moment, the potential negotiations between one of Trump’s sponsors and a government agency that finds it in violation of federal regulations. That company, though, has a trump card the likes of which has never been seen in American politics: Should it become apparent that the case is going awry, they can threaten to pull their support of the president’s television show. The move would inevitably make waves on cable news of the kind that Trump has repeatedly demonstrated himself to be susceptible to. Any decision, whether in favor of the company or against it, immediately loses credibility: If the company is found guilty, the decision is easily framed as retaliatory, a vindictive manifestation of the president’s ego and narcissism; if the company is let off the hook, it will appear that the company has manipulated his venality for its own gain. A formerly uninvolved company facing federal investigation could essentially pull the same gambit in reverse: By publicly committing to sponsor The Apprentice, a company could create a situation in which any decision appears to reflect not the facts of the case but the sticky situation created by its involvement with the show. In this sense, then, Trump’s decision to stay on as executive producer, and the conflicts of interest the position creates, jeopardizes not only the president’s ability to carry out his job but also the fundamental legitimacy of the rule of law for any company that currently is or in the future may become involved with the show.
Additionally, the president’s continued involvement with the show creates a strange and tricky situation for NBC. Trump’s reputation is inextricably intertwined with that of the show, meaning that NBC will to some extent be caught between promoting Trump as a successful businessman and doing its journalistic work. The network will likely also be advertising The Apprentice during its other programs, not only through commercials but also possibly in-studio promotions on other shows, creating conflicting incentives for NBC journalists who will be trying simultaneously to talk about the Trump administration fairly while their own network markets one of his products.
Back to table of contents
That Pipeline
The Dakota Access Pipeline, or DAPL, was the subject of continual controversy during the presidential campaign, drawing months of protests because of the perceived environmental impact it would create by crossing the Missouri River in close proximity to a Standing Rock Sioux reservation. Shortly before the election, the Army Corps of Engineers announced that it would be halting progress on the pipeline for further environmental review and to study potential routes that might avoid crossing both the river and Native American territory. On January 24, however, only four days after President Trump took office, he has decided to move forward with both DAPL and the Keystone XL pipeline, which the Obama administration likewise blocked because of environmental and tribal-sovereignty concerns. Trump has been vocally supportive of the pipelines for months, claiming that they would create new jobs in construction and the oil industry.
Trump’s FEC filings, which remain the only public record of his finances, suggest that he may have had an additional incentive to greenlight the projects: According to financial-disclosure forms he filed in June 2015 and May 2016, Trump has owned stock in Energy Transfer Partners, the company seeking to build DAPL. The stock was worth between $500,001 and $1,000,000 in 2015 and between $15,001 and $50,000 in 2016.
The president and one of his spokesmen, Jason Miller, have both stated, without offering evidence, that Trump’s stock-related conflicts of interest have been resolved. According to Trump and Miller, the president sold off his stocks in June of last year specifically to head off concerns that they may influence his decision-making in office. However, they have offered no meaningful evidence to back up their claims—evidence which, in this case, would likely be fairly easy to provide. They could, for example, offer more details on when exactly the stocks were sold beyond simply “back in June,” or explain why they did not mention the sale until December, just after the election, if the intention was to proactively address conflict-of-interest questions.
Given Trump’s penchant for dissembling about his personal finances and the lack of evidence that he has sold off his stocks, Trump’s decision to push ahead on DAPL and Keystone XL simply underscores the need for him to take larger, and more public, steps to distance himself from his financial interests. Moving forward with the pipelines is not the first instance of Trump making a significant decision that benefits a company whose stock is listed in his financial disclosures. For example, when Trump announced his intention to intervene at the factory of the air-conditioner manufacturer Carrier in Indianapolis, the Indianapolis Star noted that Trump’s filings list stock in Carrier’s parent company, United Technologies.
Back to table of contents
Those HUD Grants
As has been noted on several previous occasions, one of the overarching questions about America’s first businessman presidency is just how President Trump’s vast empire will interact with federal agencies that answer to him. One of these potentially sticky situations became something of a flashpoint at the hearing for Dr. Ben Carson, Trump’s appointee to lead the Department of Housing and Urban Development. At the hearing, Senator Elizabeth Warren pressed Carson over the fact that, as the head of the department, he would be in charge of numerous programs that the president could manipulate to profit his real estate empire, asking Carson, “Can you assure me that not a single taxpayer dollar that you give out will financially benefit the president-elect or his family?” Though Carson did not respond to the question with regard to Trump specifically, he responded that he “will absolutely not play favorites for anyone” or act with an “intention to do anything to benefit any American, particularly.” (Warren went on to expound on how Trump’s lack of financial transparency makes it borderline impossible to know if a policy will benefit him.)
Warrens’s line of questioning was not entirely hypothetical: Trump does, in fact, own properties the maintenance of which falls under HUD’s purview. Thanks to an inheritance from his father, the president holds an ownership stake in—and has made millions from—Starrett City, a 153-acre, 5,881-unit low-income housing development in Brooklyn. The development, according to ABC News, receives substantial federal funding via HUD’s many programs designed to support low-income renters and homeowners. Trump could easily press for policies that would increase his profits from Starrett, most notably allowing for the sale of the complex, an action HUD blocked in 2007—and, potentially, to other properties from which he may profit in ways that, without more complete financial information, the American public may not even know.
The potential for a profitable relationship with HUD underscores a central problem with Trump’s refusal to fully divest from his holdings before entering office. It’s not just high-ranking officials who will possess the ability to act in a manner that benefits the president’s pocketbook—it’s ordinary civil servants as well. Shortly before his inauguration, The Washington Post noted several additional ways employees in Trump’s executive branch could do so: Trademark disputes, for instance, will be adjudicated by judges appointed by his Commerce secretary, while the EPA could roll back environmental regulations that reduce profits at his golf courses.
Meanwhile, lower-level officials tasked with the day-to-day work of regulating Trump’s properties are likely to face pressure as well—if not explicit from superiors, then from the implicit, inescapable knowledge that enforcement decisions will impact the president personally. Federal Aviation Administration inspectors, for instance, are in charge of on-the-spot, random inspections of aircraft, including Trump’s, and at one point during the campaign grounded one of his planes after its registration expired; the Occupational Safety and Health Administration oversees construction sites, and has fined the Trump Organization on multiple occasions for workplace-safety violations. Only 10 years ago, politically motivated firings within the Justice Department became one of the many enduring scandals of George W. Bush’s administration; with so many executive-branch employees interacting with the president’s properties in so many different ways, some will inevitably face difficult decisions between proper enforcement at his expense or looking the other way to stay in the boss’s good graces.
Back to table of contents
That Golf Course in Aberdeen
Though his golf course at Turnberry is the more famous of his two properties in Scotland, it is Trump’s resort in Aberdeen that has attracted attention for the conflicts of interest it created when Trump spoke with the British politician and Brexit cheerleader Nigel Farage about blocking a proposed wind turbine that Trump believed would have blocked views from the resort. Now, attention has once again turned to Scotland after The Guardian reported that the Trump Organization will soon be moving forward with a multi-million dollar plan to expand its Aberdeen resort, including a new 450-room, five-star hotel and a second 18-hole golf course.
The announced expansion drew criticism almost immediately, especially coming as it did only three days after the press conference at which Trump unveiled his (woefully insufficient) plan to resolve his conflicts of interest. At the conference, the president and one of his lawyers, Sheri Dillon, announced that the Trump Organization would cease pursuing new foreign investments. Additionally, though neither Trump nor Dillon articulated the promise at the event, a press release detailing the steps Trump would be taking also states that he has “directed the Trump Organization to terminate all pending deals—over 30 in number.”
A representative soon clarified the grounds on which the Trump Organization deemed the expansion permissible in light of these statements. She argued that “implementing future phasing of existing properties does not constitute a new transaction, so we intend to proceed.” In other words, plans for the expansion had been drawn up and agreed upon before Trump made his pledge; simply moving forward with the project does not, in their view, breach their commitments to avoid pursuing new foreign investments or moving forward on pending deals.
As with so many of the defenses of Trump’s behavior when it comes to conflicts of interest, the representative’s justification overlooks the actual concerns regarding conflicts of interest: that Trump’s relationship with the British government and other foreign-policy questions may be colored by his expectations of what a policy will do to his property values, for instance, or whether wealthy guests will pay for a stay in the interest of currying favor with him. Instead, the argument relies on a tactic Trump and his many surrogates have used with alarming frequency. On several occasions, Trump has come out with what appears to be a clear policy statement, which then becomes increasingly vague as he and his surrogates attempt to justify an action or position. One famous example is his proposal to ban Muslims from immigrating to the United States: As critics started to question its constitutionality, and as support for the measure declined, he revised it to a vaguer policy of “extreme vetting,” which itself varied significantly depending on who was describing it to whom and what part of the plan they were defending. Here, the Trump Organization has done something similar: In the face of allegations that the Aberdeen development violated the company’s pledges regarding conflicts of interest, the pledges have been revised to create a more vague, and therefore more permissive, stance. As Richard Painter, who served at the chief ethics adviser for President George W. Bush, put it, the new, more ambiguous policy “clearly illustrates that around the world, he will just simply expand around the various holdings and as they continue to expand, the conflicts of interest expand.”
If, as they argue, the expansion of the Aberdeen golf course constitutes neither a “new foreign deal” nor a “pending deal,” that only further complicates the picture regarding the Trump Organization’s future behavior during Trump’s presidency. The organization currently has several nascent development projects, several of which, including those in Georgia, Argentina, Indonesia, and Taiwan, have already prompted concerns over conflicts of interest. Trump and Dillon’s statements at his press conference appeared to rule out continued development of these properties, but the ongoing development in Scotland calls into question whether other development plans have truly been canceled or whether Trump will find a similarly legalistic framework under which they claim they can proceed. By moving forward in Aberdeen, Trump has demonstrated just how easily he can—and, in all likelihood, will—continue to flout concerns regarding his conflicts of interest by simply redefining the terms of his promises in order to allow for his latest move.
Back to table of contents
That Other Billionaire New York Real-Estate Developer
President Trump’s promise to erect a big, beautiful wall between himself and his business lasted slightly more than 48 hours.
Almost exactly two days after the January 11 press conference at which Trump announced plans purported to disentangle himself from his namesake business, the Huffington Post reported that the president had scheduled a meeting with Steven Roth. Roth, a fellow New York-based billionaire real-estate developer, is in charge of Vornado Realty Trust, an investment firm that co-owns two of Trump’s most valuable properties, one in Manhattan and one in San Francisco, and served as an economic adviser during the campaign. What Trump and Roth discussed at their meeting remains unknown, nor is it clear when exactly the meeting was scheduled. Regardless, that the meeting came directly on the heels of the press conference at which Trump and his lawyer laid out a plan supposedly meant to resolve conflicts of interest, throws the reality of the problems that come from having a businessman as president—and one who seems completely uninterested in taking steps that would actually distance him from his business—into sharp relief.
Shortly thereafter, The Wall Street Journal reported that Roth may soon become involved with the Trump administration beyond just his pre-existing friendship and partnership with the president. Trump, it seems, will soon be naming Roth and Richard LeFrak, yet another New York-based billionaire real-estate developer, to oversee a council of 15 to 20 builders and engineers who will be carrying out the president’s $1 trillion infrastructure proposal, a situation which itself provides ripe opportunities for the pair to direct federal dollars toward projects from which they will financially benefit. This news comes on top of a December report in The Washington Post that Roth’s firm had put in a bid to rebuild the FBI’s headquarters, a deal that could be worth as much as $2 billion. In other words, Trump, mere days after promising to remove himself from his businesses, is instead ushering a longtime partner into his administration.
The move could also end up providing yet another avenue by which Trump could enrich himself in office and by which others could attempt to curry favor. Whether or not he intended to do so, the president’s decision to place Roth at the head of such a large pool of money sends a signal to other companies about the continued intermingling of his business and his presidency: that working with the Trump Organization can be a path to increased influence or even appointment. And though Trump claims that he will no longer be in involved in day-to-day operations, he will be actively profiting off from the company, meaning that he will be personally making money off of the attempts of others to gain influence over American public policy.
Back to table of contents
Those Indonesian Politicians
Despite President Trump’s assurance that he has stopped pursuing deals since the election, his namesake organization apparently moved forward wi