If President Donald Trump is serious about draining the swamp, he ought to start with his son-in-law, Jared Kushner.
Kushner raised eyebrows when he strutted into the role of pandemic point man for the White House, alongside his former roommate and a handful of McKinsey & Company management consultants. As Chris Buskirk wrote in these pages, Team McKinsey has “a history of doing little more than helping failing institutions fail in style while growing rich in the process.”
Project Airbridge, Kushner’s plan to take the reins of the Federal Emergency Management Agency supply-chain task force and partner with private companies to fly health care supplies to New York City from China, lived up to the McKinsey style.
Never mind that the Chinese government, through state-run media, threatened to plunge America into “the mighty sea of coronavirus” as we grappled with the pandemic. Kushner’s solution for a problem caused by China, and exacerbated by our manufacturing dependency on that country, was to turn to Beijing for “help.” Managed decline, brought to you by Kushner and McKinsey & Company.
Square Pegs, Round Holes
Kushner’s record in the public and private sector is long and mediocre. After he took over the New York Observer, the newspaper stopped its weekly print edition that had been in operation since 1987.
“Kushner paid $1.8 billion,” Michelle Goldberg reports, “for a Manhattan skyscraper at the very top of the real estate market in 2007. The debt from that project became a crushing burden for the family business.”
His immigration plan, shopped to GOP senators in a PowerPoint presentation, was dismissed as “laughably simplistic.” His plan for the Palestinian economy was lampooned by Michael J. Koplow of the Israel Policy Forum as “the Monty Python version of Israeli-Palestinian peace, where no contention is too absurd to be floated.”
Nevertheless, the president looks on as Kushner performs the political equivalent of jamming square pegs in round holes, encouraging him to try and try again.
Amid the sound and fury of the pandemic, most people didn’t notice that it was a health insurance company closely connected to Kushner, Oscar Health, that undertook development for a coronavirus website in partnership with the government. Kushner’s younger brother Joshua co-founded Oscar and is a major investor in the company, “and Jared Kushner partially owned or controlled Oscar before he joined the White House,” according to an exclusive report in the Atlantic. Though Oscar did the work free of charge before abruptly shutting down, it rightly raised the hackles of ethics lawyers.
“It’s not typical. It’s usually not allowed,” said Jessica Tillipman, an assistant dean at the George Washington University School of Law and an expert on anti-corruption law. “The concern, when you have some free services, is that it makes the government beholden to the company,” Tillipman added. If something is free, it means the consumer is also the product.
Kushner consistently has played down events, yet, according to Politico, he’s pining for the creation of a national coronavirus surveillance system. The system is intended to give the government information about patients and treatment in real-time, aiming at Kushner’s goal of providing “informed, data-driven decisions.”
It would, of course, come at the cost of privacy, harvesting a trove of data in a world where such a resource is lucrative, all while placing Kushner—a man who is “Beijing’s point of interest” in the administration—at the center of it all.
Oh, Lucky Man!
In a recent white paper for “Healthy China,” a plan “central to the Chinese Government’s agenda,” Oscar bills itself as having a “digital intelligence” network that could benefit China’s medical industry. Jackie Kahn, an Oscar spokeswoman, told reporters in an email that Oscar “had already been working on a coronavirus-testing website when [the Department of Health and Human Services] called to ask for help,” suggesting it “was a coincidence that had nothing to do with Kushner.” It was, as so many of Kushner’s projects tend to be, just that lucky.
It was Kushner, after all, who pushed for the Opportunity Zone tax breaks to be included in President Trump’s 2017 tax overhaul, a program intended to provide investors with cuts in capital gains taxes for putting money into businesses and buildings in 8,700 poor, struggling neighborhoods across the country that might not otherwise attract the cash. Kushner Companies, the development firm once headed by Kushner, happened to have properties in Opportunity Zones that include $13 million of New Jersey beachfront, along with at least 10 Opportunity Zones elsewhere. “Pier Village,” as the ritzy shoreline property is called, features 786-square-foot one-bedroom apartments for as much as $2,765 a month and it stands adjacent to another development site: a 72-room luxury hotel, also brought to your struggling neighborhood by Kushner Companies.
Kushner’s representatives repeatedly have stated that he hasn’t had any involvement in Kushner Companies since January 2017. We have only serendipity to thank, then, that after the oceanfront area received the Opportunity Zone designation in April 2017, Kushner Companies “spent more than $13 million buying additional properties in the zone, putting the company in position to take advantage of the tax breaks on future projects in the expanding beachfront complex,” as Bloomberg Businessweek reports. Pier Village is not exactly the sort of poor and struggling neighborhood that this program was designed to help.
Census data put Pier Village at a 22.6 percent poverty rate in 2010, above the provision’s 20 percent threshold. While New Jersey has more than 200 tracts with higher poverty rates, only a third of them were among the 169 to receive the zone designation, and Kushner Companies was just lucky enough to be there when it happened.
We would be remiss, however, to discount the good business sense of Nicole Kushner Meyer, Jared’s younger sister. As a Kushner Companies principal, said a company spokesperson, she “focuses on new acquisitions, developments and commercial portfolio management.” The month after Kushner Companies capitalized on the tax breaks for which senior adviser Kushner provided the thrust in the administration, Meyer appeared in a Beijing ballroom full of wealthy Chinese investors. “Invest $500,000 and immigrate to the United States,” read an event brochure.
The event aimed at encouraging Chinese investors to apply for EB-5 visas. Established by Congress in 1990, the program allows foreign nationals to obtain green cards and a path to citizenship in exchange for a minimum investment of $500,000―increased to $900,000 in 2019. About 80 percent of EB-5 green cards go to Chinese investors.
The program is similar to the Opportunity Zone tax, insofar that it is intended to help targeted areas within the United States. But it has been riddled with fraud and decried as a pay-for-citizenship scheme. The month of Meyer’s meeting in Beijing, the United States Citizenship and Immigration Services identified and confirmed 19 national security concerns with the EB-5 investor program.
Against the backdrop of Kushner signage, Chinese investors were encouraged to provide funding for “Kushner 1” as a means of acquiring EB-5 visas. Kushner 1 is a New Jersey luxury apartment project, also known as One Journal Square. Earlier, in January 2017, a representative for the U.S. Immigration Fund had asked a New Jersey official to issue a letter certifying One Journal Square as within an area with low employment—doing so would transform it into a “targeted employment area” for EB-5 investors and qualify it for a lower investment threshold to boot.
Emails obtained by CNN from the New Jersey Department of Labor and Workforce Development show that after “an official responded that the project did not qualify due to its location within a census tract with an unemployment rate below the national average, a consultant for another company asked that the state combine six census tracts together.” Official documents show that the state approved the project not long after.
While no overt reference to President Trump was made, the materials of the Beijing event played on the Kushner family’s “celebrity” status and Meyer was billed as Jared’s sister. Meyer reportedly told the crowd that her “brother Jared Kushner joined the family company as CEO,” and “recently moved to Washington to join the administration.”
Journalists claimed that the event organizers were nervous about media presence and at one point “grabbed a reporter’s phone and backpack to try to force that person to leave,” then later “physically surrounded attendees to prevent them from giving interviews.”
Naturally, news of Meyer’s meeting raised the ire of ethics lawyers. In response, Kushner Companies apologized, and Kushner’s attorney stated that he had no knowledge of the event. Kushner divested from One Journal Square and his personal counsel said in a statement that “he will recuse from particular matters concerning the EB-5 visa program.” But then an odd promotion by Qiaowai, a Beijing-based company that locates investors in China, appeared in March.
Posted by Qiaowai on the Chinese social media site WeChat, the ad suggested the Trump administration planned to increase the number of available visas. “Even some members of Trump’s family have participated in the growth of the EB-5 program,” the promotion read, mentioning the “Kushner88” New Jersey apartment project. “Given this,” the ad concluded, “in the Trump era, the EB-5 program is likely to receive support and be expanded.”
A spokesperson later said Kushner Companies was neither aware nor involved with these promotions, and they were taken down almost as soon as American media took note of them.
The “Driving Force” Behind EB-5
Things were mostly fine for Kushner Companies until 2020, when Nicholas Mastroianni, CEO of the U.S. Immigration Fund, became the subject of a civil fraud case filed against him by two Chinese investors. The business Mastroianni had promoted to investors was a Kushner Companies development known as “Trump Bay Street” in New Jersey. Then, amid the coronavirus pandemic, a push within the GOP for more EB-5 visas bubbled to the surface.
According to Politico, and despite the problematic history of the program, the Republican Party pushed to increase the number of EB-5 visas from 10,000 to 75,000 annually and reduce minimum investment for legal residence to $450,000 from $900,000―even less than the original $500,000 requirement. The Qiaowai ad proved prophetic.
While Senator Lindsey Graham (R-S.C.) quickly became the public face of shame for the covert operation, some speculated that Kushner may have been involved. “Three Senate staffers and one administration source” told journalist Daniel Horowitz of Conservative Review that Kushner was “the driving force behind the push for EB-5.”
While it is unclear whether Kushner, in fact, leveraged his position within the administration to exploit the EB-5 program in this case, there is no question he has worked quietly to expand the legal immigration schemes by which he has profited professionally.
Per Politico, while President Trump has been preaching immigration restrictionism from the populist pulpit, Kushner has been holding a “series of meetings with dozens of advocacy groups, including business and agriculture organizations” about possibly expanding various visa programs.
About Trump’s Latest Executive Order
Now reports have surfaced that Kushner yet again had a hand in driving immigration policy at a critical time.
After President Trump announced he would be suspending immigration to the United States to protect the jobs and wages of millions of newly unemployed workers during the pandemic, the Spectator USA reported an “internal battle” broke out in the White House.
Sources familiar with the situation told the Spectator that Kushner “is one of the loudest voices pushing back on a full ban and is seeking to carve out exemptions for refugees, temporary workers under the H1B visa program, and farmworkers under the H-2A visa program.”
If that’s true, then Kushner achieved a total victory.
The ban applies only to those seeking legal residency. It therefore misses the mark because, as Jessica Vaughan of the Center for Immigration Studies explains, “there will be only a modest impact since 60% of green card applicants are already here (80% of employment category is already here).” In other words, the ban applies to the only group of foreign nationals who are not coming to the United States specifically to take a job, while making exemptions for H1B, H2A, and H2B visas. Trump’s immigration proclamation actually exempts some of the largest sources of immigration and specifically economic categories which negatively affect jobs and wages for American workers.
The ban actually hurts American job prospects and wages, while putting on a cheap labor parade for big business. Worse yet, as Vaughan notes, the ban declares EB-5 entries “essential,” effectively pulling out the brakes on the already thoroughly bad program.
The president’s supporters may rightly wonder if they voted for Kushner or Trump at this point.
“In every republic,” wrote Machiavelli, “there are two parties, that of the nobles and that of the people.” The former “have a great desire to dominate, whilst the latter have only the wish to not be dominated, and consequently a greater desire to live in the enjoyment of liberty.”
For many Americans, President Trump appeared to have broken rank with the “nobles” and descended his golden escalator to lend a hand to the people. Whether that is entirely true or not is up for debate. What is certain, however, is that his son-in-law remains aligned with the acquisitive, globe-trotting class whose schemes dominate the course of American political life and the lives of the little people who swab the floors of their high-rises.
Trump’s greatest weakness now is his inability to recognize that Kushner is the leader of a faction within the White House whose interests come at the expense of the very people who voted for him.