[Congressional Record Volume 163, Number 39 (Tuesday, March 7, 2017)]
[House]
[Pages H1575-H1576]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PRESIDENT TRUMP'S FAMILY BUSINESS
(Ms. KAPTUR asked and was given permission to address the House for 1
minute and to revise and extend her remarks.)
Ms. KAPTUR. Mr. Speaker, President Trump is a master at diverting
attention, even the media's. His diversions are a perfect foil from the
constitutional questions that his and his family's behavior have raised
since he took the oath of office.
With hotels and property developments all over America and the world,
the Trump empire is dramatically expanding its domestic business,
raising vital questions as to the Trumps' profiting from public
service, including from foreign entanglements that violate the
Constitution.
Outlined in Article II of the Constitution, the clause prohibits the
President from receiving, other than his salary, any compensation,
gift, or other form of profit from the United States, a State
government, or their instrumentalities.
Congress reserves its ability to consent to foreign emoluments but
not to domestic emoluments. Our Founding Fathers were clear--no
exceptions.
It has been heavily reported in the papers that the Trump sons have
now signed at least 17 new letters of intent with potential developers,
even listing specific cities. They don't have to tell their father
about all this. The newspapers cover it in abundance. And the American
people should never have to wonder whose interests the President
serves.
Today those doubts abound. America, the scales of justice need
tending.
[From The Washington Post, Mar. 4, 2017]
Trump Sons, Planning Expansion of Family Business, Look to Leverage
Campaign Experience
(By Jonathan O'Connell, David A. Fahrenthold and Matea Gold)
New York.--Donald Trump's adult sons, who are overseeing a
nationwide expansion of the family business during their
father's presidency, are envisioning ways that their
experiences from the campaign trail can help them establish a
footing in dozens of new markets.
The idea is to move beyond a focus on luxury hotels in big
metropolises and build boutique properties in a broader mix
of cities, including some the Trump brothers came to know
well during more than a year of intensive travel, fundraising
and grass-roots networking on the road to The White House.
``I got to see a lot of those markets on the campaign,''
Donald Trump Jr., the president's eldest son, told The
Washington Post in a recent interview from his office on the
25th floor of Trump Tower. ``I think I've probably been in
all of them over the last 18 months.''
The initial plan is tied to the Trumps' previously
announced new chain, Scion, which is being designed as a
less-corporate feeling brand of high-end hotels with a more
affordable per-room price point than the Trumps' five-star
properties.
As with many existing Trump-branded property deals, the
developers would own the hotels while the Trumps would be
paid licensing and management fees.
The company says it has signed at least 17 letters of
intent with potential developers. It is targeting an array of
cities such as Austin, Dallas, St. Louis, Nashville and
Seattle--and Trump Jr. said the campaign proved useful in
forging relationships with potential new connections.
``I met people along the way that would be awesome
partners,'' he said.
The expansion plan illustrates how President Trump's
political rise has the potential to affect his business even
as he and his sons promise to adhere to a strict ethical
boundary between the company's moves and the Trump
administration. And it shows the inherent challenge in
separating the family's political work from its corporate
interests, with upsides and potential problems.
Extending the Trump business into a greater cluster of
American cities could bring political benefits for a
president who has vowed to bring jobs and economic prosperity
to struggling communities. But it also comes as Trump has
faced criticism from Democrats and ethics officials for his
decision to retain his ownership stake in the company, a
decision that means he stands to personally benefit from its
growth.
Building new hotels, for example, could create issues--tax
disputes, allegations of labor violations or environmental
violations--that require federal departments to consider
cases that could directly impact the president's finances.
And while the Trumps have vowed to sign no new foreign deals,
pursuing a raft of new domestic contracts from coast to coast
means the Trumps are likely to engage in negotiations with
private developers, banks and investors who see additional
benefits in doing business with the president's company.
``It's just going to add fuel to the fire that is already
burning . . . with him having still a foot in both the
boardroom and one in the Oval Office,'' said Scott Amey, the
general counsel of the nonpartisan watchdog group Project on
Government Oversight.
The White House did not respond to a request for comment.
The president in January added a team of ethics lawyers to
the White
[[Page H1576]]
House Counsel's Office, while the company hired a longtime
Republican attorney tasked with ensuring the Trump
Organization minimizes conflicts of interest.
In interviews, the Trump sons waved off the idea that their
plans created any potential ethical problems.
``There are lines that we would never cross, and that's
mixing business with anything government,'' Eric Trump said.
Donald Trump Jr. said that since the inauguration, he has
spoken with his father twice on the phone and once in
person--when he and his brother attended the announcement of
their father's Supreme Court nominee, Neil Gorsuch. Eric
Trump said he may ask his father how things are in the White
House but would never discuss government or business affairs.
``Will we ever talk about tax policy? Will I ever ask for
anything that could otherwise benefit the business?
Absolutely, emphatically not,'' Eric Trump said. ``He has no
need to know what we're doing, and I certainly don't need to
know what they're doing, and I don't want to.''
The Trumps' point man on the expansion is Eric Danziger, an
experienced executive who was hired in 2015 after previously
overseeing expansions at Carlson Hotels Worldwide, Starwood
Hotels and the former Wyndham International.
One of the first Scion projects is slated to open in
Dallas, where a Turkish-born developer aims to open a sleek
glass six-story hotel as part of a $50 million mixed-use
downtown development. The Austin, Cincinnati, Denver,
Detroit, Nashville, Seattle and St. Louis areas are also
possible targets, according to reports by Bloomberg News and
business trade publications.
The Trumps declined to say what other cities they were
exploring for projects but said they were actively seeking
contracts in many places. Danziger, speaking last month to
Skift, an industry publication, called Scion a ``four-star
lifestyle brand'' with wide geographic appeal.
``That kind of brand can be in every city--tertiary,
secondary,'' he said. ``So, how many is that? The opportunity
is for hundreds.''
Because of the prohibition on foreign deals, Danziger said
the company is ``going to have full focus--instead of some
focus--on growth domestically of both Trump and Scion.''
The expansion will not be easy, according to analysts. The
Trumps will be entering a crowded marketplace of new hotel
lines from Marriott, Hilton and Hyatt designed to appeal to a
broad cross-section of customers, said Michael J. Bellisario,
a senior research analyst with the firm Robert W. Baird & Co.
``There are so many more competitors out there today,''
Bellisario said.
For the Trumps to distinguish their projects from their
competitors, they will need to be choosy about locations,
Bellisario said. ``You've got to be on the right street comer
in the right market. You can't open these hotels in Topeka,
Kansas,'' he said. ``So when you think about that, how big
can the new line get?''
The plan is a big test for the younger Trumps.
Just as Donald Trump stepped out from his father's shadow
in the 1970s to build the family real estate business into
today's worldwide collection of golf courses, hotels, condo
towers, branded merchandise and other commercial holdings,
now Donald Trump Jr., 39, and Eric Trump, 33, have a
chance to make their mark.
Along with their sister, Ivanka, who departed the company
when their father entered office, the brothers have long
served as executive vice presidents.
Before their father ran for president, the three siblings
helped expand the firm from focusing on New York to including
the management of luxury hotels in top U.S. cities and seven
countries, plus more than a dozen golf courses.
The fruits of that work are still coming, as last month the
company opened a new golf club in Dubai and, last week held a
grand opening for a new hotel-condominium tower in Vancouver,
B.C.
A major transition for the sons is taking over a company in
which the force behind every Trump company offering--whether
it was selling hotel rooms, office buildings, golf outings,
ties or raw steaks--was Donald Trump himself.
In interviews, Trump Jr. and Eric Trump said they consider
themselves protectors of the Trump brand, an effort they said
is sometimes misunderstood. Critics viewed the announcement
of Scion during the campaign as a move away from the Trump
name. The family's intent was the opposite; since they view
the name Trump has a standard for luxury that ought to be
insulated, they will use other brands for less pricey
products.
``We would never want to dilute the real estate brand by
going into tertiary markets that can't sustain the [luxury]
properties as we build them,'' Eric Trump said, ``A lot of
hotel companies have gotten this wrong.''
Both sons worked for their father starting at young ages,
doing landscaping and other labor on his projects.
A University of Pennsylvania graduate, Trump Jr.'s first
assignment at the company was to work with executives at New
York City real estate projects.
Eric Trump joined after graduating from Georgetown in 2006.
He has overseen the Trump Winery near Charlottesville and
worked on the Trump hotel in Las Vegas, where he developed a
reputation as a hands-on executive.
``If there's a property tax issue or any litigation, he
flies into Las Vegas and takes care of it,'' said Phil
Ruffin, a casino mogul who is the Trumps' partner in the Las
Vegas project. ``He hires the lawyer. If there are any
capital improvements, he approves them. He is very energetic
like his father--he will just work night and day.''
With their father in charge, there was an informal division
of labor among his three eldest children, governing which
projects each swooped in to help.
Ivanka Trump created her own brands of shoes, jewelry,
handbags and coats. She took the lead on some of the Trump
Organization's mast prominent recent projects, such as the
$212 million D.C. hotel, which had its soft opening in
September.
``I'm probably the most obviously like [Trump Sr.],''
Ivanka Trump said in a 2011 company video titled ``Trump: The
Next Generation.''
``In certain ways,'' she added, ``Eric is very similar to
him in terms of his love of construction and building. And
Don has his sense of humor.''
The Trumps' planned corporate expansion comes as the
president has faced intense criticism from Democrats and
ethics experts for his continued ownership interest.
A liberal watchdog organization, Citizens for
Responsibility and Ethics in Washington (CREW), has sued
Trump, arguing that his hotel operations violate a
constitutional provision barring the president from accepting
gifts or payments from a foreign government. Some Democrats
have argued that Trump's international trademarks, including
one long-sought registration granted in February by China,
also violate the Constitution's emoluments clause.
Trump has called the CREW lawsuit ``totally without
merit.''
Amey, of the Project on Government Oversight, said there
were ways for the Trumps to avoid potential domestic
conflicts related to the hotel expansion. He said they could
put the hotel business under another corporate structure,
which does not involve a trust directly owned by the
president himself.
``There are solutions to solving this, [hut] there doesn't
seem to be a will and a desire to do that within the White
House,'' Amey said.
The Trump brothers say they are taking ethics concerns
seriously and are doing everything necessary to avoid
distracting from their father's work as president.
``Have I used him as a sounding board in the past? One
hundred percent,'' Trump Jr. said. ``Have I learned a lot
from him? Couldn't have had a better mentor. But he's got
real stuff he's got to deal with. These are real people's
lives . . . . So this notion that he is still running the
business from the White House is just insane.''
Trump Jr. scoffed at the idea that his father might have
somehow viewed running for president--spending millions of
dollars of his own money to run against more than a dozen
Republican challengers and Democratic nominee Hillary Clinton
when few pundits gave him a chance to win--as a moneymaking
endeavor.
``That's not a get-rich-quick scheme,'' he said. ``That
doesn't make any sense whatsoever.''
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