This week, we learned that the federal agency responsible for the lease of the federal landmark property — the Old Post Office — of former President Donald Trump’s Washington hotel approved a lease that for the duration of Trump’s term was probably illegal.
The bottom line is that every dollar that went to the corporation that operated the hotel enriched Trump.
The General Services Administration ruled in 2017 that the Trump International Hotel lease was in “full compliance” with federal law even though a clause in the lease explicitly forbade “any elected official” of the federal government from receiving any benefit from the leased property. In a letter to Trump’s sons Donald Trump Jr. and Eric Trump, the GSA said the terms of the lease were complied with because Trump had resigned from his positions with the Trump Organization and would receive no “direct” earnings from the hotel.
That made no sense. Throughout his presidency, Trump retained ownership interest in the Trump Organization and its properties, including the Trump International Hotel. The fact that the hotel’s profits went to a corporation owned by and controlled by Trump rather than to Trump personally was irrelevant. Also irrelevant was the fact that he appointed someone else — his sons, of course — to manage the corporation while he was president. Ditto Trump’s claim he had a “blind trust.” He couldn’t simply put the Trump hotel and his other properties in a “blind trust” and pretend he didn’t know he owned them.
The bottom line is that every dollar that went to the corporation that operated the hotel enriched Trump. Trump obviously received a benefit from the federal government’s lease of the Old Post Office. The GSA lawyers who said this arrangement complied with the terms of the lease focused on form over substance. And they surely knew who their boss was: a GSA administrator appointed by none other than Trump himself.
There were also more serious constitutional and legal issues involving conflicts of interest with the lease, and it is these issues that the GSA just ignored. According to a Wednesday report from NBC News, the GSA “failed to examine ethical conflicts and constitutional issues posed by then-President Donald Trump’s refusal to divest from the property, a new congressional report says.”
"The House Committee on Transportation and Infrastructure's report," the article continued, "found that the General Services Administration did not track foreign government payments to the hotel or identify the origins of more than $75 million in loans made by Trump and his family to shore up its troubled finances."
The Trump Organization spent about $200 million converting the Old Post Office into a luxury hotel. Apparently, the GSA did not know where $75 million of that money came from.
The Trump Organization spent about $200 million converting the Old Post Office into a luxury hotel. Apparently, the GSA did not know where $75 million of that money came from. What we do know — and what the GSA knew at the time — is that the Trump Organization has substantial business dealings with Russia and several Middle Eastern countries, including Saudi Arabia. We also knew then that foreign diplomats and other foreign nationals frequented the Trump hotel throughout the Trump presidency.
This is important because the emoluments clause of the Constitution explicitly prohibits any officer of the federal government from receiving any emolument — that is, a profit or benefit — from a foreign government without consent from Congress. The founders did not want our government officials being paid off by foreign sovereigns. The emoluments cause prevents that — if it is enforced.
Shortly after Trump won in 2016, Norman Eisen, who had served as President Barack Obama’s chief White House ethics lawyer, Harvard Law School professor Laurence Tribe and I wrote a detailed report for the Brookings Institution explaining why Trump needed to divest from most of his business empire, including the Trump hotel, or he would be in violation of the emoluments clause.
Trump refused to divest. He instead engaged in the charade that he was in compliance with the emoluments clause, just as he was in compliance with the terms of the GSA lease, because his sons operated the hotel while he owned it. Sheer nonsense.
We sued him on Jan. 21, 2017, his first full day in office. The plaintiffs included Citizens for Responsibility and Ethics in Washington as well as hotels and restaurants competing with the Trump Organization. After more than two years of litigation, the 2nd U.S. Circuit Court of Appeals upheld the standing of some of our plaintiffs, ordering that the case proceed to discovery and trial.
But Trump, in his usual way, delayed disclosing any information about the hotel’s finances or his own finances until his last day in office, after which the Supreme Court dismissed our suit as moot.
During the whole four years — from the day we filed our suit in January 2017 until the day it was dismissed as moot after Trump left office — we were hoping the federal courts would enforce the emoluments clause because it was clear that the executive branch, whose senior officials take an oath to uphold and defend the Constitution and the laws of the United States, would not do its job. Now, we learn more details about how, in particular, the GSA, the landlord of the Trump hotel lease, simply looked the other way.
Congress needs to make sure the emoluments clause is enforced. The Protecting Our Democracy Act, which has passed the House of Representatives, would do just that. The Senate passing the bill is critically important. Without a clear congressional mandate, executive branch agencies will be reticent to enforce the emoluments clause against the president or any other powerful senior officials.
As the founders feared when they drafted and ratified a Constitution with that clause, this prohibition is vital to our national security — unless we don’t care if the president or other senior officials receive payoffs from foreign governments who may be our adversaries.