USRN Corruption Blog Post
The Corruption Blog digs into the details of the all-encompassing corruption of the Trump administration.
Post #18 The Corruption of Jared Kushner
By Sean Gray
July 20, 2020
Jared Kushner is Donald Trump’s son-in-law and the father of three of his grandchildren. He has stayed in the president’s good graces despite numerous political mishaps and public relations hits. The pair have much in common besides a shared workspace. Both are the sons of wealthy New York real estate magnates, the source of most of their wealth. Both have relied on their lofty beginnings to propel them to tremendous riches and influence. And both, since 2017, have used their Executive Branch positions to further enrich themselves at the expense and /or neglect of the American public.
Kushner’ qualifications for Senior Adviser to the president are questionable at best. He graduated with Honors (as did 90% of his class) from Harvard in 2003. However his curious acceptance to the school was investigated by ProPublica editor Daniel Golden for his 2006 book ‘’The Price of Admission’’, which focused on American elites buying their offspring into prestigious institutions. Golden spoke to officials at Kushner’s high school alma mater who told him bluntly, ‘’there was no way anyone in the administrative office thought [he would get in on merit]’’. The same official expressed disappointment that other more deserving students who applied were excluded. Charles Kushner, Jared’s dad, sat on Harvard’s fund raising-related Committee on University Resources and in 1998 (the year before his son’s admission) pledged a $2.5 million gift to be paid in ten annual installments of $250,000. Harvard does not comment on individuals applicants and the Kushner family has denied any connection between the tax-deductible gift and Jared’s acceptance.
Kushner began in the real estate business while attending college, selling rental properties in nearby Somerville, Massachusetts. When his father was imprisoned for tax fraud, Jared took the reins of the family business at the age of 26. Like Trump before him, Kushner sought to expand his father’s real estate empire and set his sights on Manhattan. His purchase of the 666 5th avenue building in New York for a then-record $1.8 billion represents one of the biggest financial boondoggles in the city’s history. The exorbitant (and unprompted) bid greatly expanded Kushner Company’s acquisitions, but also greatly amplified its risk. The property was greatly over leveraged (Kushner put down only $50 million in equity) and steadily lost money from the time of its purchase. When Brookfield properties effectively bought the building in 2018, it paid $1.28 billion, or roughly two-thirds of what Kushner paid a decade earlier.
More recently,Westminster Managements, owned by the Kushner company, is currently being sued by Maryland’s attorney general for ‘’hundreds of thousands’’ of unsanitary and unsafe conditions in its Baltimore units. The suit also alleges that the company has victimized tenants ‘’at all stages of offering and leasing’’. Westminster Management has also continued its predatory practices in spite of the Covid-19 pandemic. While millions of Americans have found themselves furloughed or fired, The Kushner Co. has with cruel indifference served tenants with lawsuits, debt collections and eviction notices.
When Kushner was appointed to a presidential Senior Adviser role he immediately requested ‘’Top Secret’’ clearance. Top secret is the highest designation and is intended to shield information that ‘’unauthorized disclosure [of] could reasonably be expected to damage national security’’. On the forms submitted to make the request, Kushner omitted multiple foreign contacts which raised the specter of possible conflicts of interest. He offered the explanation that a member of his staff had prematurely ‘’hit send’’ on an incomplete form. No mention was made of an attempt to retrieve the form. When he resubmitted his application, under the section ‘’foreign contacts’’ Kushner included a 2016 meeting he attended at Trump Towers with agents of the Russian government offering dirt on political opponent, Hilary Clinton. The meeting made him a subject of the Mueller Investigation.
Federal law does not require Executive Branch employees to divest of assets, but they must be recused from a matter when ‘’it would have a direct or predictable effect on the employee’s financial interests or certain interest that are treated as that of their own, [including] those of a spouse. Kushner’s personal holdings and stake in his family business likely represent conflicts under both provisions. On their federal disclosure forms, Kushner and Ivanka Trump list assets in the hundreds of millions of dollars. Of Kushner’s real estate holdings, a number were secured with significant capital from foreign investors. He is personally liable for several loans on his properties. Given his wide portfolio of government responsibilities, many in the realm of foreign policy, it stands to reason that Kushner should have either been made to divest such assets, or recuse himself from a good deal of the activities of his office.
Kushner also was a beneficiary of the CARES Act Paycheck Protection Program . A crucial part of the coronavirus relief legislation, it was intended to keep small businesses afloat while they remained shuttered or hindered. Public outcry led to the disclosure of three Kushner companies and other wealthy individuals connected to the White House receiving aid. The New York Observer, which Kushner had previously operated, and is still run by his brother-in-law, was approved for a loan in the $350,000-$1,000,000 range. As was the subsidiary of Kushner Co. Esplanade Livingston LLC. Princeton Forestal, in which his family owns a 40% share, was approved for a loan in the $1-2 million dollar range.
Jared Kushner, and other real estate investors also stand to reap benefit from the CARES Act based on a back-door provision in the bill. Section 2034 pertains to corporate taxes and allows businesses to write off all net operating losses incurred going back five years. The previous cap on deductions of that nature was capped at $500,00, per 2017’s Tax Cuts and Job Acts. The provision is expected to disproportionately benefit the wealthiest Americans, especially those invested in real estate.
In 2018, Kushner was tasked with brokering peace talks between Israel and Palestine. He has been given an outsized role in the federal administration’s response to the coronavirus. Both times he was spectacularly ill-prepared for the challenges. Neither of the efforts have gone well, as continued tumult between the Middle Eastern countries and surging rates of Covid infection in the US can attest Yet Kushner has stayed in this role for which he is unsuited while his business conflicts-of-interest have gone unchallenged.