The Trump International Hotel enjoys an enviable location in the nerve center of American governance. It stands on Pennsylvania Avenue, situated roughly midway between the White House and the Capitol. Across the street is the headquarters of the FBI. It shares a block with the Internal Revenue Service’s main building. And just a few steps away is the Robert F. Kennedy Building, which houses the bulk of the Justice Department. But the real source of its power is its proximity to the president, his children, and their bottom lines.
Such is the nature of Trump’s Washington. The president rose to power in part by fashioning himself as an anti-corruption crusader, one whose personal wealth would insulate him from the muck of the “swamp.” Nothing could be further from the truth today. Two years after Trump took office, the swamp is as fetid as ever—and the strongest stench is emanating from Trump’s hotel.
Ethical quandaries about the president’s business empire often struggle to break through the news cacophony of the Trump era. But their lack of salaciousness doesn’t diminish their importance. The Washington Post’s report on Wednesday about T-Mobile is a case in point. The telecommunications company announced last April that it would try to merge with Sprint—a deal that, like any major corporate merger, would be scrutinized by the Justice Department and Federal Communications Commission. The day after T-Mobile went public with its proposal, nine of the company’s top executives paid for rooms at the president’s hotel for a multi-day stay in Washington, according to the Post. One executive stayed at the hotel nine more times over the next two months. John Legere, the company’s CEO, booked rooms at least another four times, and reportedly was seen often in the lobby, decked out in T-Mobile apparel.
Other troubling cases abound. The New York Times reported earlier this month that Trump’s inaugural planning committee paid the D.C. hotel “more than $1.5 million” for a variety of services, including the use of a ballroom and other rentable spaces. A spokesperson of WIS Media Partners, one of the contractors hired by the committee, told the newspaper that its staffers rented rooms at the hotel at the “explicit direction” of inaugural committee officials, though one member of the committee anonymously denied this to the Times. A WNYC/ProPublica investigation also found that at least one inaugural committee planner raised concerns that the Trump Organization may have been overcharging them for use of the hotel.
Trump’s hotel is well-situated in the capital, so it’s not surprising that inaugural events would be held there. (For similar reasons, it’s also not surprising that top executives would opt to stay there.) But the optics are troubling at best. Trump’s inaugural committee raked in more than $100 million from corporate and individual donors, a far higher sum than similar committees operated by George W. Bush and Barack Obama. By spending those funds at Trump’s properties, the inaugural committee effectively transfers those donors’ contributions directly into the Trump Organization’s coffers. And since Trump hasn’t fully divested himself of his business holdings, as ethics officials recommended before his inauguration, those profits eventually flow into the pockets of the president and his adult children.
What have donors received in return? Casino magnate Sheldon Adelson, a Republican mega-donor and the committee’s largest individual contributor, gave more than $5 million. He happens to enjoy a close relationship with the president. Adelson and his wife joined Trump at a small private gathering last November to watch the results of the 2018 midterms. The Trump era has also been a fruitful one for Adelson. The Las Vegas billionaire lobbied in favor of the president’s decision to move the U.S. embassy in Israel to Jerusalem in 2017, reversing decades of U.S. foreign policy on the matter. And earlier this week, the Justice Department reversed an Obama-era legal opinion in declaring that federal law bans all forms of internet gambling, which Adelson strenuously opposes as a potential threat to his casino empire.
Adelson, like any other American, has the right to donate to political campaigns and committees and lobby elected officials. Foreign governments enjoy no such privileges, however. That distinction makes the overseas cash flows into the Trump Organization all the more alarming. Last month, the Post reported that a lobbyist for Saudi Arabia’s monarchy spent more than $270,000 for rooms at Trump’s hotel shortly after his election as president. Those rooms housed dozens of U.S. veterans who were then brought to Capitol Hill to lobby against a law that would open the door to lawsuits against the Saudi government for the September 11th attacks.
This isn’t the only time that foreign powers have done business on Trump properties, either. The Times identified stays at the president’s hotels by the Malaysian prime minister and his staff, as well as by the Republic of Georgia’s ambassador to the United Nations. Romania’s consulate in Chicago also rented space at Trump’s hotel in that city for an event last November. Both the foreign governments and the Trump administration have denied any wrongdoing or impropriety; the Trump Organization has also paid six-figure sums to the Treasury to offset any foreign expenditures to it. The company hasn’t been forthcoming about tabulating the precise sources of these profits, however. And it’s unclear whether this is enough to avoid violating the Constitution’s ban on foreign incomes to federal public officials.
Trump no longer maintains day-to-day control over his business empire. Some of his actions may have nonetheless favored his plum real-estate property in the capital. Last year, Democrats on the House Oversight Committee accused the president of improperly intervening in the search for a new FBI headquarters. The bureau’s current headquarters, the J. Edgar Hoover Building, is a crumbling Brutalist scar on Pennsylvania Avenue. One plan would have transferred its staff and operations to a new headquarters in the suburbs and sold the coveted property to a private developer. Democrats alleged that Trump intervened to keep the bureau at its current location, thereby preventing another hotel from being built just a few steps from his own.
And while most of the federal government is partially shut down over Trump’s demand for a border wall on the southern border, the U.S. Park Service has maintained its operations at the historic clock tower and observation deck that sits atop the Trump International Hotel. Agency officials told reporters that it’s required by federal law to keep the site open despite the shutdown. With much of the capital’s other historic landmarks shuttered, local tour groups have begun redirecting their customers to one of the few remaining open sites.
Corruption damages a democratic society in two ways. Bribes and kickbacks plainly subvert the principle of self-government by subordinating the common good to an elected official’s personal enrichment. But even the appearance of corruption alone is corrosive to public faith in democratic institutions, whatever the legality of the underlying acts may be. As long as Trump and his family continue to own and operate a private business empire with no accountability, the appearance of corruption will remain—and the risk of actual corruption will only keep growing.
So what is to be done? A good start would be for Congress to pass a law forcing future presidents-elect to fully divest their business holdings the moment they enter office. Ethics experts urged Trump to choose that path during the transition period after his election, to little effect. His successors should not be given the option to decline. Until then, Congress’ best course of action would be the one I proposed last February: nationalize the Trump Organization so that taxpayers, and not the president and his children, can reap its rewards.