Plaintiffs allege that the Hotel received an emolument from the Federal Government in the form of the GSA Lease, which governs the Hotel’s use of the Old Post Office Building in the District of Columbia, where the Hotel is situated. . . . Plaintiffs allege that, before the President’s inauguration, the then-Deputy Commissioner of the GSA indicated that the President would be in violation of the Lease unless he fully divested himself of all financial interests in it. . . . Shortly after his inauguration, the President replaced the Acting Administrator of the GSA. Id. Plaintiffs allege that several weeks later, on March 16, 2017, less than two months into his term, the President released a proposed budget for 2018 that increased the GSA’s funding, while cutting back on other the funding of other agencies. . . . On March 23, 2017, the GSA issued a letter determining that the President and the Hotel were not in violation of the Lease. . . . Plaintiffs allege that the GSA’s abrupt about-face position was and is in direct contradiction of the plain terms of the Lease and that, by determining that the Hotel was and is in compliance with the Lease, the Federal Government bestowed upon the President an emolument in violation of the Domestic Emoluments Clause.
That sure sounds like the fix was in.
At any rate the specific findings of the IG are critical. The lease for the hotel includes this provision: “No member or delegate to Congress, or elected official of the Government of the United States or the Government of the District of Columbia, shall be admitted to any share or part of this Lease, or to any benefit that may arise therefrom; provided, however, that this provision shall not be construed as extending to any Person who may be a shareholder or other beneficial owner of any publicly held corporation or other entity, if this Lease is for the general benefit of such corporation or other entity.” Plainly, Trump is an elected official of the U.S. government; the lease as it currently stands has been violated, according to the plain language of the lease.
The GSA attorneys understood there was an issue as to whether Trump’s ownership violated the emoluments clause but “Nonetheless, the attorneys decided to ignore the emoluments issues,” the IG writes. The excuse that the agency doesn’t usually deal with constitutional issues is absurd; there is an entire building across the street from the Old Post Office — the Justice Department — available to answer such questions. Alas, GSA “did not contact or request guidance from OLC [DOJ’s Office of Legal Counsel] before making this decision.”
What about the terms of the lease itself? Office of Government Ethics lawyers pressed Trump’s representatives for him to divest himself of his ownership so as to avoid a breach of the lease. Trump’s representatives gave their own analysis that there was no problem with Trump retaining the lease and demanded a stamp of approval. Wouldn’t you know it, the president’s lawyers got what they wanted: a letter saying the Trump company was “in full compliance with Section 37.19 and, accordingly, the Lease is valid and in full force and effect.” The IG found:
We conclude that decision was improper for several reasons: (1) as a federal agency, GSA is subject to the Constitution, which also is incorporated into the OPO [Old Post Office] lease; (2) GSA already had determined that the Foreign Emoluments Clause bars a federal employee from doing business with a foreign government in his private capacity, a conclusion reinforced by instruction OGC [GSA’s Office of General Counsel] received from OGE [Office of Government Ethics]; (3) OGC ignored OLC’s binding legal opinions on the Emoluments Clauses, even though OGC OPO attorneys knew that OLC issued opinions involving both President Reagan and President Obama; and (4) OGC failed to seek OLC’s guidance, even though the GSA OPO attorneys knew that OLC issued opinions on the Foreign and Presidential Emoluments Clauses.
The IG report doesn’t directly say the lease itself has been violated (which seems patently obvious), but it’s clear on one point: Trump’s ownership poses a serious constitutional issue. And of course, a federal-district court already found the basis for an emoluments clause violation.
This situation reeks of the blatant corruption one finds in autocratic regimes. The “king” (or whoever) gets to keep, indeed enhance, his moneymaking operations; the government bends to his will and allows him to avoid obvious legal issues because, well, because he’s “king.” That is precisely the difference, or it should be the difference, between an authoritarian regime and a constitutional republic.
Noah Bookbinder, executive director of Citizens for Responsibility and Ethics in Washington (CREW), which filed an emoluments lawsuit against the president, released the following statement: “Seconds after President Trump took the oath of office, we filed a complaint with GSA asserting that his holding of the lease on the Old Post Office violated the terms of the lease, and we announced that he was in violation of the Constitution’s Emoluments Clauses. A few days later, we filed our historic emoluments lawsuit.” The statement continued, “The Inspector General’s report vindicates our conclusions, agreeing with our definition of emoluments. It further takes the GSA to task, finding they ‘all agreed early on that there was a possible violation of the Constitution’s Emoluments Clauses.' ” The statement concludes, “The corruption of the presidency has never been clearer.”
Constitutional scholar Larry Tribe tells me: “That GSA should have addressed the constitutionality of the lease itself, given that the president was both landlord and tenant, is true, but I wouldn’t let the perfect become the enemy of the good here. One step at a time may be the best we can realistically expect.”
Now that there is a Democratic House majority, Congress might want to take this up, hold hearings and demand GSA explain how in the world they’ve concluded that Trump isn’t in violation of the lease.