An explosive report highlights major problems resulting from a president who refuses to divest from or publicly disclose his private business interests, perhaps best exemplified by an upscale hotel located just block from the White House.
According to the Washington Post’s Jonathan O’Connell and David Fahrenthold, a day after T-Mobile announced its $26 billion merger with rival Sprint in April 2018, T-Mobile CEO John Legere was one of nine company executives among a group of “VIP Arrivals” at the Trump International Hotel in Washington, DC.
President Trump still owns and directly profits from the Trump International, and the T-Mobile/Sprint merger requires approval from his administration. While the deal hasn’t received final approval, it recently received the blessing of Team Telecom, which consists of the US Committee on Foreign Investment and the departments of Justice, Homeland Security, and Defense.
Since last April, Legere and other T-Mobile executives have repeatedly patronized the Trump International, with one particular executive making at least 10 visits. Rooms in the hotel regularly cost more than $300 a night. From the Post:
Last week, a Post reporter spotted Legere in the Trump hotel’s lobby. In an impromptu interview, the T-Mobile chief executive said he was not seeking special treatment. He chose the Trump hotel, he said, for its fine service and good security.
“It’s become a place I feel very comfortable,” Legere said. He also praised the hotel’s location, next to one of the departments that must approve the company’s merger.
“At the moment I am in town for some meetings at the Department of Justice,” Legere said. “And it’s very convenient for that.”
With a merger pending that’ll need government approval, T-Mobile’s CEO John Legere is back at the Trump Hotel DC. Also Corey Lewandowski is here. And Lewandowski just went over to Legere’s table and they chatted. (Verified with my own eyes .)
— Zach Everson (@Z_Everson) June 27, 2018
Ethics watchdogs don’t buy Legere’s explanation that his decision to repeatedly spend money at the Trump International has nothing to do with a lucrative merger that requires approval from the Trump administration.
“It’s currying favor with the president. It’s disturbing, because it’s another secret avenue for currying favor with the government,” Sheila Krumholz, executive director of the Center for Responsive Politics, told the Post.
Foreign governments are spending money at Trump’s hotels too
The problem of companies currying favor with the president by lining his pockets through his business is related to the emoluments issue Vox’s Matt Yglesias detailed on Tuesday.
Article I, Section 9, Clause 8 of the US Constitution prohibits the president from accepting gifts from foreign governments. Yet foreign governments, including Kuwait and Saudi Arabia, have spent money at Trump’s hotels.
In August, the Washington Post reported, “After two years of decline, revenue from room rentals [at the Trump International Hotel in Manhattan] went up 13 percent in the first three months of 2018.” The increase was largely due to Saudi Crown Prince Mohammed bin Salman’s patronage of the hotel during a visit to New York City, during which he and his entourage didn’t even end up staying there.
The DC and Maryland governments have sued the federal government, alleging that Trump is violating the emoluments clause, and have won standing. The lawsuit is on hold during the ongoing government shutdown.
There is no clause of the Constitution preventing presidents from doing business with domestic companies like T-Mobile. But before Trump, as a matter of course, presidents would divest from their private business interests before they took office.
Trump broke from precedent by refusing to divest — or disclose
Trump has broken a lot of precedents, but one of the biggest has been refusing to release his personal tax returns — something presidential candidates have long done to show transparency — and refusing to divest from his assets or put them in a blind trust.
The most frequently mentioned example of a president divesting from his business interests before taking office is Jimmy Carter, who famously put his family peanut farm in a blind trust before he was inaugurated in 1977.
“Well, it was a hard decision for me to make and this is something that I’ve had to face. I’ve literally given up my own method of making a living here in Plains,” Carter said at the time. “But I don’t want any decision that I make as president to have any effect on my own income. The trustee will try to do the best they can and take care of my remaining family here, my mother and Billy, not to disrupt their lives too much.”
Richard Nixon and John F. Kennedy also made moves to distance themselves from assets they owned and managed before taking office. Former George W. Bush ethics adviser Richard Painter told Fortune that before Trump, “every other President in modern times has tried as best they could to act as if the law did apply to them.”
Trump has, notably, declined to either divest or disclosure. Corruption, or the appearance thereof, doesn’t seem to bother him in the slightest.
“It should come as no surprise that a CEO of a major corporation would want to stay with us”
Shortly before he took office, Trump held a news conference in which he unveiled a plan to distance himself from his business interests that amounted to a “sham,” as Vox’s Libby Nelson put it back then.
He announced that he would put his businesses into a trust managed by his sons Eric and Donald Jr. — both of whom have since emerged as key spokespeople for their dad. Though the trust isn’t blind and Trump still profits from his business, he touted at the news conference that he was doing more than necessary to avoid conflicts of interest.
“I could actually run my business and run government at the same time. I don’t like the way that looks,” Trump said. “But I would be able to do that if I wanted to.”
Later, he added: “I have a no-conflict situation because I’m president … it’s a nice thing to have.”
While the situation may be nice for him, it raises questions about whether the executive branch is making policy in the public interest, or in the Trump family’s financial interest.
“It should come as no surprise that a CEO of a major corporation would want to stay with us,” he said, alluding to the service the hotel provides — though the quote also alludes to the financial incentives motivating Legere, who was once an outspoken critic of Trump, to spend money at his hotels.