Ivanka Trump’s announcement this week that she would take an unpaid federal job in the White House makes official the familial coziness of President Donald Trump’s Administration. Ivanka and her husband, Jared Kushner, with his-and-hers security clearances and offices in the West Wing (hers upstairs from his), will be on hand to advise on any subject—anything, that is, that doesn’t create a troublesome conflict of interest. Despite their official positions and efforts to address the ethical challenges of their unique roles, potential for conflicts remains.
Ivanka’s decision to become an official government employee seems intended to address objections raised by ethics experts who were skeptical of an earlier plan in which she would have served as an informal adviser (with a White House office and a security clearance). As an actual staff member, she will be required to comply with the more stringent ethics rules governing federal employees, rather than simply offering to comply with them voluntarily. “I have heard the concerns some have with my advising the President in my personal capacity,” Ivanka wrote in a statement on the matter. “Throughout this process I have been working closely and in good faith with the White House Counsel and my personal counsel to address the unprecedented nature of my role.”
Like Kushner, she will now be required to divest some of her assets and to distance herself from her remaining business interests while serving in the White House. As government employees, they will also have to file financial-disclosure forms. On Friday evening, the first round of those disclosures was filed, and the Times reported that the couple “will remain the beneficiaries of a sprawling real estate and investment business still worth as much as $741 million.” The Times also noted that Ivanka retains a stake in the Trump International Hotel in Washington worth between five and twenty-five million dollars. Still, the new arrangement is unlikely to mitigate the broader concern that has come to hang over the Trump Administration: that the nature of the First Family’s businesses and the way that they are choosing to handle them may make it difficult to separate serving the American people from serving their own financial interests.
The person who is counselling Ivanka Trump and Jared Kushner on their ethics issues and on their business trusts and divestiture agreements is Jamie Gorelick, a partner at the WilmerHale law firm. Gorelick, a lifelong Democrat who served as the deputy Attorney General during the Clinton Administration, says that she sees her job as trying dispassionately to insure that those she’s advising are in compliance with the laws, no matter what the outcry. One such mini-scandal ensued when Kushner announced, with Gorelick’s legal blessing, earlier this year, that he was selling most of his real-estate and other assets to his brother and mother. (“It sounds like a shell game to me,” a Caplin & Drysdale attorney named Matthew T. Sanderson told the Times.) Many of the steps Kushner has said that he is taking, like those of his father-in-law, are designed both to follow the letter of the law and to keep most of the assets close, with the profits staying with family. I met with Gorelick in a conference room in the Pennsylvania Avenue offices of WilmerHale. She was not interested in acknowledging the distinction that many critics perceive between the spirit and the letter of the law—legally speaking, Gorelick argued, they were one and the same. Congress designed the ethics laws as they are to reflect the correct moral choice at the time. The moment has perhaps come to revisit those laws, in light of recent and previously unthinkable developments in American government. But asking people to do more than they are legally required to, Gorelick said, is unrealistic and unfair.
“People don’t like this President, and they’re very agitated. And I think it’s expressing itself in all kinds of ways,” Gorelick said. “I’ve never seen an atmosphere quite like this. I started practicing law in the aftermath of the Nixon Administration, and I have to go back all the way to then to recall a period of such agitation and concern. And so, in that atmosphere, trying to give straight-up legal advice is hard—to give someone advice, that if they do X they are abiding by the law, and yet to have that advice be characterized as a shell game, is challenging.” She added, “My view of that is, I hear what you’re saying, and maybe this conversation about ethics should be broader than it currently is and Congress ought to look at it again. But we are a country of laws, and we need to abide by the ones on the books.”
Ivanka’s business conflicts present several levels of complexity, according to Gorelick. First, there is the matter of her role within the Trump Organization, the global hotel and branding corporation, which is owned by Donald Trump himself but ostensibly being managed by Ivanka’s brothers Donald, Jr., and Eric. Ivanka had the right to “certain income flows” (Gorelick’s words) from Trump properties in which she was involved. Those payments will be converted to fixed disbursements rather than ones tied to the performance of the various business deals Ivanka has made, which means that nothing she does while serving in government can affect their value.
Second are her stock-and-bond holdings, which, according to Gorelick, are being sold off. The third and trickiest strand to untangle is that of Ivanka’s own branded fashion line, which operates the way that most of the rest of the family business does, as a licensing arm that collects fees in exchange for granting outside companies the right to use Ivanka’s name to manufacture and sell shoes, clothing, and jewelry aimed at young professional women.
“She can’t shut down the business, because people have contracted for the use of the Ivanka Trump brand. She could sell the business, but someone would be running around the world, licensing her name, which is more problematic,” Gorelick said. “The third is what she’s done: keep the business and accept the conflicts, and set up a trust that governs how the business will be run.” In this, she is following the logic of her father, who made a similar argument about the impossibility of selling his self-branded company. As is required by law, Ivanka will recuse herself from government matters that may affect her company. Given that almost any law or regulation affecting a business could potentially have an impact on hers, this is sure to be difficult. Like her father, Ivanka will get regular reports on the financial performance of her company. Her trustees are also family; they are her brother-in-law, Josh Kushner, and sister-in-law, Nicole Meyer, who will confer on important decisions with Gorelick, and in some cases with Ivanka herself.
To the Trump Administration’s many critics, discovering what the law does and does not allow has been a startling educational process. Early in his Administration, Trump pointed out that, as President, he was exempt from conflict-of-interest laws and expressed no interest in setting a principled example by divesting his business interests anyway. He made a show of handing over day-to-day management of his firm to his sons, even as he continues to accumulate the profits generated by the company’s present and future activities. He travels to his own golf resorts many weekends, at taxpayer expense, and drives interest in his properties by doing so. In the longer term, he is building relationships with world leaders in countries where he may one day want to expand his brand. His time as President, even if it is less than successful, will have been one of the greatest advertising and marketing mechanisms of all time. In this atmosphere, Trump has named an unprecedented number of supporting cast members with conflicts of their own, from the Secretary of State, Rex Tillerson (whom Gorelick advised on his own divestiture plans), to the Treasury Secretary, Steven Mnuchin; the Secretary of Health and Human Services, Tom Price, and the Secretary of Education, Betsy DeVos.
“This Administration has a lot of self-made . . . men, mostly,” Gorelick said. “It has very successful corporate executives, like Rex Tillerson and others. And getting people in those financial circumstances to comport with the ethics laws is hard.”
“No, political leaders should not become enriched by their participation in government. That is the fundamental rule that underlies all of the rules and regulations,” she went on. If people are still unhappy after those folks have taken the steps that are necessary to adhere to the letter of the law, Gorelick said, “then, really, they should seek to have the law changed.”