Trump's Presidency and His Business: Drain That Swamp
On my way to a lunch in Mumbai in early October, I stopped to admire one of two active projects to which Donald Trump is lending his name in India. The site was a skeletal mass of concrete and steel when I saw it, though when completed it's planned to be an 880-foot tall condominium sheathed in gold. Buyers are promised access to a private jet. A gold banner hung from the top floors: "Trump Tower Mumbai."
As with many Trump ventures, the project is owned by others (in this case, the Lodha Group, an Indian developer). In exchange for the marketing mojo attached to his name, Trump gets a fee from the owners. And the value of the Trump name just went up, as the Lodha Group has noted on the home page of its Trump Tower Mumbai website: "Congratulations Mr. President-Elect. The Trump Name Is Rising High In Mumbai Too."
One of Trump's other Indian partners, Panchshil Realty, the developer building Trump Towers Pune, is happy to trade on Trump's name as well. The founders, Atul and Sagar Chordia, visited Trump in New York last week to meet with the president-elect and his three eldest children, Donald Jr., Ivanka, and Eric. The Chordias told the Economic Times, an Indian business publication, that the president-elect said during the meeting that he was pleased with the governing style of Indian Prime Minister Narendra Modi, while Donald Jr. told them that the Trumps wanted to enlarge their business portfolio in India.
At the end of the meeting, President-elect Trump took time for a photo op with the Trump Organization's business partners:
A spokesperson for the Trump Organization told the New York Times, according to an account of the meeting posted on Saturday, that the Chordias' visit was just a "courtesy call" -- that the executives traveled all the way from India to "congratulate Mr. Trump on his election victory."
The Chordias' courtesy call is more than just the latest reminder that the president-elect will have a hard time separating his business dealings from affairs of state.
As I've noted in several columns since June, presidents aren’t subject to conflict-of-interest laws. It's up to the president, then, to set the ethical tone for his or her administration by being transparent (releasing personal tax returns, for example) and by being circumspect (avoiding any appearance of financial self-dealing, and dissolving or turning over business and financial interests to a disinterested third party).
Yet in the two weeks since Election Day, Trump has placed his three eldest children and his son-in-law, Jared Kushner, on his transition team. That empowers the four of them to play pivotal roles in shaping how the West Wing is staffed and how key executive branch agencies are populated -- despite a number of earlier promises to keep them at a distance from policymaking because they still run the Trump Organization.
Ivanka Trump and her husband, Kushner, joined the president-elect for a private meeting in Trump Tower on Thursday with Japanese Prime Minister Shinzo Abe.
This meeting came just days after the merchandizing of an Ivanka Trump-branded bracelet raised questions about whether Trump's daughter would use her proximity to the White House to enrich herself.
It also came amid news that Trump was trying to pave the way for Kushner to play a senior advisory role in the White House. The argument from Trump's camp is that Kushner wouldn't have conflicts of interest in his White House role because he has his own real estate and financial interests apart from the Trump Organization. The counterargument is Kushner's wife, of course.
Ivanka Trump will be running the Trump Organization while also presumably having an informal channel into the Oval Office through her husband, should he ascend to a more significant White House role – further eroding boundaries between the Trumps' deal-making and Donald Trump's policymaking.
This isn't the first time that a president's relatives have bumped up against concerns about financial conflicts. Franklin D. Roosevelt's son, James; John Kennedy's father, Joseph; Richard Nixon's brother, Donald; Jimmy Carter's brother, Billy; Bill Clinton's brother, Roger, and George H.W. Bush's son, Neil, have all given critics reason for alarm about family members taking advantage of their proximity to the White House.
None of these earlier relationships, however, approach the breadth of financial and business conflicts that Trump and his children carry with them to the White House. Trump himself continues to give us fresh examples on a regular basis.
He spent the weekend vetting possible Cabinet appointments in a public parade through the clubhouse at his golf course in Bedminster, N.J. Sure, Bedminster might have been a convenient locale for handling what has traditionally been a more closeted process. But it also generated buckets of free publicity for one of Trump's businesses.
Also over the weekend, the Washington Post reported that the new Trump International Hotel in Washington had invited local embassy staffers for a party and tour after Election Day to solicit future business.
Some of the partygoers told the Post that they thought it wise to spend money at the president-elect's hotel in hopes of creating goodwill with the new administration. Others said they were worried that "spending thousands of dollars on a Trump property could look like an attempt to buy access or favors."
Business at the hotel, which sits on government-owned land, appears to be booming. No ethics rules prevent Trump from running a hotel frequented by diplomats and titans of industry, and no rule forbids them from spending their money there.
Meanwhile, in the Philippines, a local developer who is partners with Trump on the Trump Tower Manila has a new job: special envoy to the U.S. In early November, the developer, Jose E.B. Antonio, said that Philippine President Rodrigo Duterte gave him the diplomatic post in order to "enhance business ties and strengthen the economic affairs between the two countries.”
All of this is just a practical form of financial diplomacy, say some observers, and you can expect others to continue trying to line up to profit off of the Trump name.
“Obviously there will be a positive impact on the visibility of the projects because he is kind of a de facto ambassador," Gulam Zia, a senior real estate consultant in India, said during a recent interview with an Indian news site. "So when you have Trump Tower you will obviously expect some people to take some amount of premium, some amount of comfort because it is the most spoken-after person or the biggest leader of the world."
Vice President-elect Mike Pence said over the weekend that overhauling the federal government's ethics laws would be a priority for the new Trump administration.
"A lot of people want to see us drain the swamp," Pence told CBS. "They want to see fundamental ethics reform."
Pence was referring to tighter guidelines and restrictions he and Trump want to place on lobbyists to limit their influence on public policy. While legislators have traditionally kept the president free of conflict-of-interest laws so as not to hamstring executive decision-making, they never envisioned a businessman with Trump's portfolio ascending to the Oval Office.
If Trump and Pence really want to drain the swamp, they should extend their ethics reforms to the office that Trump is about to occupy.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
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