Jared is building a new luxury high-rise apartment building and needs additional financing. With an investment of $500,000, foreign investors would be entitled to an EB-5 Visa and be allowed to immigrate to the United States. If Jared needs to raise $150 million, and assuming all foreign investors he solicits donate the minimum $500,000 needed to obtain a visa, how many investors does Jared need to reach his goal of $150 million?
In a scenario that reads like a middle school math problem, Jared Kushner, has found himself subject to growing scrutiny and concern over the intersections between his position of influence in the White House and his private business interests, raising severe concerns over a possible conflict of interest.
The criticism comes amid reports that one of his businesses, Kushner Companies, was urging wealthy Chinese investors at an event in Beijing to invest $500,000 in several of his high-end luxury projects.
In exchange, investors would be eligible for the EB-5 Visa Program, a federal program which grants visas to investors. Marketing materials used to promote the project included titles declaring “government support” and “founded by celebrity developers.” The event even included brochures that said, “Invest $500,000 and immigrate to the United States.”
The criticism however isn’t just aimed at Kushner. Democrats and republicans alike have been raising concerns over the EB-5 visa program for years.
The visa program, created back in 1990, was originally intended to promote development and sustainable job creation in rural areas in the United States. However, due to a lack of federal regulations, it is often used by developers to finance high end real-estate projects, much like the ones that Kushners and the Trumps are known for developing. There have also been concerns with federal regulations in place to track the finances of the individuals who become eligible for the program after their investment. With the case of one visa applicant, it was found that their money had connection to a string of brothels in China.
This is not the first time that a conflict of interest of this nature involving those close to the politically powerful have come to light. Both George W. Bush’s son and Hillary Clinton’s brother raised red flags due business engagements that crossed with the federal government. In Clinton’s case, it involved the same visa program that Kushner has been reportedly promoting.
Upon receiving criticism, the Trump Administration came out with a statement indicating their willingness to review the visa program and address concerns. One potential solution is to raise the investment necessary to qualify. However, if individual can afford to invest $500,000 to qualify for the program, one could assume that they could more than likely still qualify if the price rose.
However, the ethics and conflict of interest concerns raised specifically regarding Kushner are different. While promoting a federal program, which was intended for job creation in rural areas, to raise capital to finance high-end projects falls in a moral grey area, it is not illegal. It becomes a legal issue, however, when the person doing the promoting also holds a high level position in the White House with easy access to the President, all while simultaneously profiting directly from the use of the program. To further demonstrate this, it should be noted that Kushner’s sister was in route to the event in Beijing where this very program was going to be promoted and peddled, before Donald Trump even signed off on renewing the EB-5 Visa program.
The Chinese media has come out with an interesting, though not surprising reaction to the matter. The Global Times, one of the major state owned media outlets in China, did acknowledge the concern that this situation has created.
However, it noted several points. Firstly, the promotion of U.S. real estate and similar investment projects in China, much like Kushner’s, is actually quite common. The Global Times points to the Chinese edition of the New York Times, which regularly publishes real estate information to attract investors. Citing the The Guardian, The Global Times pointed out that the visa program is not news to the country’s wealthy, as about 85% of the visas are allocated to Chinese citizens.
The second point made was that while this is a seemingly lucrative deal for wealthy Chinese, the Chinese government is unlikely to give any sort of preferential treatment to Donald Trump or his family in return. To this point it would seem that the Global Times forgot that not long after being inaugurated, China awarded Donald Trump some 38 preliminary trademarks in China. Further more, his daughter Ivanka, won a trademark in April of 2017 during the same time that she, her husband Jared Kushner, and her father met with Chinese President Xi Jinping.
During a time when America’s global leadership is regularly brought into question, the Global Times’ position makes sense makes sense as this is an opportunity for China to further its own rise within the global community.
Since the election, the Trump administration has grappled with issues from the accusations of colluding with the Russians during the elections, to push back from the public on issues ranging from health care and immigration reform.
The added pressure of a conflict of interest amongst Trump and his family members businesses’ only serves to destabilize and delegitimize the administration. As we’ve seen with the collapse of the Trans Pacific Partnership trade deal, China is ready and willing to fill any voids left vacant by the United States, if the international community should have them.