One of the many oddities – perhaps fascinating side stories – to Trump is how the rise of his son-in-law Jared Kushner was almost designed in the lab for the most epic kinds of corruption. It has become a commonplace over the last year that Donald Trump’s second act as TV star and brand licensor since the early part of this century was heavily financed by Russian money. It’s a commonplace because it’s true. And in itself there’s nothing illegal about that or even wrong. But despite Trump’s need for foreign investment capital, because he had been and remains blackballed by all the big US banks, there’s never been any clear evidence that Trump was in acute and specific need for a big amount of capital around the time he ran for President.
That is not the case with his son-in-law.
As has been widely reported, back in 2007, under Jared Kushner’s leadership, the family company vastly overpaid for a flagship real estate property at the perhaps appropriately numbered 666 5th Avenue. It’s a 41 story tower. It’s design apparently makes it one that few potential tenants want to rent in. It was a crazy investment at the peak of the boom. It became crazier after the bottom fell out in the 2008 crash. And the entire loan comes due in 18 months.
Basically the Kushner family owes hundreds of millions of dollars on this property that it really cannot hope to recoup by any business means. As this new article in Bloomberg explains, the plan – if you can call it that – seems to be to go even further into debt by demolishing the building, building a newer and better one and recouping the losses over the very long-term. As the Bloomberg piece understatedly and elegantly puts it, that means the money has to come from someone who isn’t interested in making a profit or maybe even holding on to their investment.
Short of outright corruption that might mean foreign money looking for a showpiece property in New York City or foreign money looking to get out of its unstable country of origin. Before the Trump campaign, Kushner was having a very hard time finding anyone who was interested – not surprisingly! That changed dramatically when he became top deputy to the President of the United States. Then everyone wanted to talk – including the head of the Russian state bank which makes ‘strategic’ investments for Vladimir Putin.
I had had a hard time figuring out why this hadn’t already been settled. For any number of foreign billionaires – or the states they work in concert with – taking a loss of a few hundred million dollars would be a great deal to be in that tight with the President’s family. The irony was that with Kushner’s new and totally unrivaled power came new and totally unrivaled scrutiny. Dirty or no-profit-seeking money doesn’t like scrutiny. One Chinese and another Gulf state concern were going to end Kushner’s troubles earlier in the year. But they got spooked when reporters started asking questions. It was almost unquestionably this money hunt that led Kushner to meet with that chief of a Russian owned state bank during the transition – a source of many of his current troubles.
What all of this amounts to is that while Kushner has been given oversight of numerous key foreign policy issues and problems, his ‘family’ is simultaneously in a desperate hunt for money which basically has to come from abroad – from a lot of the people he meets with in his White House job. It’s like having a Secretary of State desperate for help getting money from every foreign potentate he meets with. In fact, it’s not ‘like’ that. It sort of is that.