The Nixon example pales in comparison to the emolument concerns raised about President Trump, whose retention of a financial interest in his far-flung businesses at a minimum creates the appearance that foreign agents or government are currying favor with him or, as in the case of the Chinese trademark approvals, awarding valuable items that might be payoffs. Keeping the president free of this kind of foreign influence—and the appearance of it—was a major worry of the Constitution’s framers. President Trump’s refusal to attend to this concern—in fact, his total disdain for it—is what makes his treatment of emoluments a great and dangerous offense. The porous line between his personal and governmental business, particularly in the area of foreign affairs, poses an imminent danger to America, and his steadfast refusal to rectify the problem may constitute a high crime and misdemeanor.
President Trump has made no serious attempt to comply with the Constitution’s emoluments clauses. He has hidden and obfuscated the nature of his business holdings and payments to them. He continues to draw income from his businesses. Although he has been offered multiple ways to remedy these violations and urged repeatedly to do so, he has chosen not to. Indeed, there is evidence that suggests President Trump has encouraged and sought emoluments. Perhaps above all, he has accepted emoluments without asking for congressional approval, flagrantly violating the Constitution.
Foreign Emoluments
President Trump has numerous foreign financial entanglements. Many of them involve foreign governments. Not surprisingly, the Trump International Hotel in Washington, DC, the subject of the State of Maryland lawsuit previously mentioned, is the epicenter of many an apparent violation of the foreign emoluments clause.
Foreign governments appear to believe that giving President Trump money through this hotel is a surefire way to curry favor and affect his judgment. Even before the inauguration, foreign government officials were looking to spend money at the president-elect’s hotel. “‘Why wouldn’t I stay at his hotel blocks from the White House, so I can tell the new president, ‘I love your new hotel!’ Isn’t it rude to come to his city and say, ‘I am staying at your competitor?’” an Asian diplomat told the Washington Post shortly after the election. The newspaper went on to report: “In interviews with a dozen diplomats, many of whom declined to be named because they were not authorized to speak about anything related to the next US president, some said spending money at Trump’s hotel is an easy, friendly gesture to the new president.”
“Friendly gesture” is a nice way of saying “buy influence.” At least one diplomat interviewed by the Washington Post laid out the thinking clearly: “‘The temptation and the inclination will certainly be there,’ said Arturo Sarukhan, a former Mexican ambassador to the United States. ‘Some might think it’s the right way to engage, to be able to tell the next president, ‘Oh, I stayed at your hotel.’ If I were still in government, I would discourage it, among other reasons because it can be questioned and looked at in a very poor light, as though you are trying to buy influence via a hotel bill.’”
Indeed, the Trump Organization was quick to capitalize on foreign government eagerness. Eleven days after the election, it hosted a reception to promote the hotel to about one hundred foreign diplomats, and a “director of diplomatic sales” was hired to facilitate business with foreign states and their diplomats and agents. One former ambassador later reported hearing that the State Department was pressuring foreign diplomats to stay there.
Foreign dignitaries and diplomats who have stayed at or used the Trump International for various functions or meals include those from:
Georgia: The ambassador and permanent representative to the United Nations stayed at Trump International (April 2017);
Kuwait: The country has twice celebrated its National Day at the hotel (February 2017 and February 2018);
Malaysia: Prime Minister Najib Razak and members of his delegation rented conference rooms and appeared to stay overnight (September 2017);
The Philippines: The embassy hosted its National Day at the hotel (June 2018);
Romania: President Klaus Iohannis and his wife, Carmen Iohannis, enjoyed breakfast in the hotel lobby (June 2017);
Saudi Arabia: Consultants and hired protesters spent $268,000 at the hotel for several months of lobbying against US antiterrorism legislation, according to public filings—including, notably, shortly after the early June 2017 blockade against Qatar, of which President Trump tweeted his implicit approval; and
Turkey: The US-Turkey Business Council, which is controlled by the Turkish government, held its annual conference at the hotel (May 2017).
There are other examples: Greek officials in town to celebrate their nation’s Independence Day at the White House stayed at the hotel (March 2018); an official from the Dominican Republic was seen dining at the hotel (March 2018); Turkey’s foreign minister appears to have stayed at the hotel during the inauguration (January 2017). Ambassadors from Russia, the United Arab Emirates, and Turkey have also been spotted at the Trump International.
This type of foreign government activity is precisely what the framers sought to forestall by including the foreign emoluments clause. To be sure, some diplomats might just like the hotel above all others in Washington, DC. Many might regard staying at or having dinner there as merely a “friendly gesture.” Others certainly will regard it as a way to buy influence or access outright.
The Trump International Hotel has succeeded in charging more for its rooms since the inauguration. According to the Washington Post, in 2017 “guests have paid an average of $652.98 a night to stay there, beating the company’s expectations by 57 percent. … That probably makes it the most expensive hotel in the city.” While the average room rate for non-Trump hotels in the United States increased 2.3 percent in 2017, and rates across all the hotels bearing his name have dropped sharply—25 percent on average—the DC Trump International is an exception, its unique success undoubtedly buoyed by its place as an ideal vehicle for providing benefits to the president.
Likely in response to public concern, President Trump has claimed that he can avoid violating the foreign emoluments clause by donating the profits made from foreign government guests. In March 2018, the Trump Organization said it would pay $151,000 to the US Treasury, the amount it claimed was the profit it earned from foreign government use of his Washington hotel. But there was no backup information to verify the calculations—and the Trump Organization had stated previously that it would only estimate the amounts, in any case. Nothing in the Constitution appears to permit turning over only profits to the Treasury—and estimated ones at that. Moreover, any use of a hotel room in the Trump International is a likely benefit, meaning the entire price is an emolument, since an empty room is a loss.
The Trump International is not the only site of the president’s apparent receipt of foreign emoluments. He receives $1.9 million in annual rental revenue at Trump Tower in New York City from the Industrial & Commercial Bank of China, whose majority owner is the Chinese government. The bank’s offices are six floors below the president’s own Trump Tower space, and it is the largest commercial tenant in the building. In 2019, its lease will be over, meaning that, according to a February 2018 Forbes article, “Eric Trump and Donald Trump Jr. could well be negotiating right now over how many millions the Chinese government will pay the sitting president.”
In January 2018, the government of Qatar paid $6.5 million for an apartment in the Trump World Tower, bringing its total to four units with a cumulative cost of $16.5 million. The Trump Organization receives monthly fees from the tenants in the building. Other governments own units there or regularly use its facilities. The Afghan, Indian, Qatari, and Saudi Arabian governments pay more than $225,000 a year in building-related charges to the Trump Organization.
In March 2018, Saudi Crown Prince Mohammed bin Salman booked a five-day stay at the Trump International Hotel in New York City. Prior to his stay, the hotel had experienced a two-year revenue decrease; the Saudi p
rince’s stay was enough to reverse the trend, driving revenue up 13 percent for the first quarter of the year, according to a report from the hotel’s general manager obtained by the Washington Post. In August 2018, the New York attorney general’s office confirmed that it was investigating whether the stay was an emolument and whether to sue President Trump as a result.
Trump Indonesia: The Trump Organization is developing two hotel and golf course properties in Bali and Lido. According to one analyst, those resorts are the beneficiaries of six potential emoluments: 1) more than 1,500 acres of public land have been granted to the developments; 2) two toll roads are being constructed for them by a state-owned company (the land that the access road runs over is farmland that was sold as a result of government pressure); 3) the government granted broad, normally hard-to-obtain permits to build inside a national park; 4) legal requirements for an environmental impact assessment and building code restrictions for construction on oceanfront cliffs were waived; 5) the land-use zoning was altered from agriculture or watershed to tourism; 6) the government is apparently refusing to enforce many environmental regulations. All told, President Trump has reported $2–$10 million in revenue from the two projects, which are not yet even completed.
In addition, the Trump hotels and golf courses now stand to benefit from a newly announced theme park, announced in May 2018 and due to be built by a Chinese government–owned construction company, with $500 million of its funding coming from the Chinese government.
Trump Towers Istanbul: The two towers were constructed in the last decade. President Trump licensed his name to the developer, Dogan Holdings, and continues to receive revenue from it, up to $1 million last year. A $2.5 billion fine for unpaid taxes, however, has been imposed on Dogan Holdings by the Turkish government. If aggressively pursued, the fine could dramatically affect President Trump’s revenue from the project. According to a Newsweek report, Turkey’s President Recep Tayyip Erdogan “told associates he believes he must keep pressure on Trump’s business partner [in Turkey] to essentially blackmail the president.”
Trump Tower Manila: The $150 million, 57-story residential tower is nearing completion, and sales are under way. President Trump’s business partner in the development is effectively a government official: in late 2016, Philippine president Rodrigo Duterte appointed Jose E. B. Antonio, special envoy to Washington for trade.
Trump Ocean Club International Hotel & Tower, Panama City: In March 2018, the Trump Organization management team in Panama City was ejected from the property. The company’s lawyers then wrote a letter to the president of Panama warning that the matter “has repercussions for the Panamanian state, which is your responsibility.” The Trump Organization deal in Panama ended in the summer of 2018. Before the collapse of that deal, the Trump Organization had benefited from government favors and actions, including use of the hotel for government functions and government repair of private drainage and sewage systems around the building after a private contractor declared bankruptcy.
These examples may be the tip of the iceberg. President Trump’s companies do business around the world, sometimes with other companies controlled by foreign governments. Often the deals and interactions are shrouded in secrecy. For example, though the Trump Organization sold more than $35 million in real estate in the United States in 2017, the identities of some purchasers are cloaked by the use of limited liability companies. Two years prior to Trump’s nomination, according to a USA Today investigation, 4 percent of Trump property purchasers used legal tools to obscure their identity. In 2017, 70 percent did.
Domestic Emoluments
President Trump has not said whether or how he will deal with emoluments from state officials or from agencies of the United States, such as the State Department. Unlike foreign emoluments, they cannot be remedied by congressional approval or anything else. They are entirely prohibited, as noted above.
Payments resulting from at least five incidents may amount to domestic emoluments:
At least one governor of a state has stayed at the Trump DC hotel on official business.
Tax concessions were given to the Trump Organization by the District of Columbia.
The State Department appears to have scheduled events for visiting groups that it brings to the United States at the Trump International Hotel in Washington, DC. Amounts accruing to President Trump in this manner are not known, but a Freedom of Information Act request has been lodged with the State Department.
The federal General Services Administration (GSA) determined that the Trump Organization’s lease of the Old Post Office, now the Trump International Hotel, is valid despite a provision stipulating that “no official of the government of the United States shall be admitted to any share or part of this lease.” The GSA decided—after President Trump took office and his appointee took over the agency—that the provision was no bar because a new provision in the hotel’s operating agreement prohibited any distributions to him while he was in office, and because he removed himself from management of any of the Trump companies involved in the lease. Does this flimsy reasoning reflect an arm’s-length, objective analysis—when the GSA was headed by President Trump’s own appointee? Or, rather, is it an emolument—because the president will still receive his share of the revenues, although receipt is postponed? The Constitution does not allow emoluments that are deferred; that would be a loophole that would swallow the rule.
In Mississippi, a hotel development managed by the Trump Organization asked for and received a $6 million tax break from the state.
President Trump Maintains an Active Interest in His Business Holdings
President Trump is president and business owner at the same time. He has not given up or altered ownership of his businesses since his inauguration and is still involved in their operation. Though the full extent of his involvement is not clear, he remains engaged.
Before his inauguration, President Trump made it clear that he did not take the potential emoluments and conflicts of interest raised by his business activities seriously. “I could actually run my business and run government at the same time. I don’t like the way that looks,” he said. “But I would be able to do that if I wanted to.” He told the New York Times: “In theory I could run my business perfectly and then run the country perfectly.”
He established a trust to hold his business assets and said he would turn over the “leadership and management” of his companies to his two sons. The trust instrument has not been publicly released, but his lawyers have confirmed that he can withdraw money from it at any time and can dispose of assets in it as he chooses. He also can revoke the trust whenever he wants.
He promised the American public that his sons would not discuss business with him. “What I’m going to be doing is my two sons, who are right here, Don and Eric, are going to be running the company,” President-elect Trump said at a January 2017 news conference. “They are going to be running it in a very professional manner. They’re not going to discuss it with me.”
Yet, a few months later, Eric indicated that he provides his father regular updates. He spoke to Forbes magazine, which reported that “he will continue to update his father on the business while he is president. ‘Yeah [Eric said], on the bottom line, profitability reports and stuff like that, but you know, that’s about it.’ How often will those reports be, every quarter? ‘Depending, yeah, depending.’ Could be more, could be less? ‘Yeah, probably quarterly.’ One thing is clear: ‘My father and I are very close,’ Eric Trump says. ‘I talk to him a lot. We’re pretty inseparable.’”
Eric Trump is not the only person to report interactions with President Trump about his business. In late 2017, the director of revenue management for the Trump International Hotel in Washington wrote, in an email obtained by the Washington Post:
The company is interesting to work for being under the Trump umbrella. DJT is supposed to be out of the business and passed on to his sons, but he’s definitely still involved … so it’s interesting
and unique in that way. I had a brief meeting with him a few weeks ago, and he was asking about banquet revenues and demographics. And, he asked if his presidency hurt the businesses. So, he seems self aware about things, at least more than he lets on. I am far left leaning politically, so working here has been somewhat of a challenge for me. But, it’s all business.
President Trump continues to boost his businesses. For example, in his first year in office, he or his staff promoted one of his properties or brands fifty-four times. He publicized his New Jersey golf club while giving a speech to the South Korean parliament. He touted a winery he owns in Virginia while discussing the violence that left one person dead at the August 2017 neo-Nazi rally in nearby Charlottesville. He also visits his properties regularly. As of mid-July 2018, he had spent 170 days at his various properties on visits ranging far and wide: a few hours at a Hawaii property while en route to Asia; three days at his Scottish golf course while waiting to meet with Russian president Vladimir Putin; fourteen times at the Trump International Hotel, in Washington; and days at golf courses and hotels up and down the East Coast. Use of his official powers to promote his private business interests, if sufficiently systematic and widespread, could amount to an abuse of power.
More recently, President Trump has been personally involved in decisions regarding federal property a block from the Trump International Hotel. For almost a decade, the GSA, which manages federal property, had planned to move FBI headquarters. One thought was to raze the building, an option that would cause considerable disruption. The site would subsequently become available for development.
The Case for Impeaching Trump Page 12
