Peter Schweizer is the president of the Government Accountability Institute and the author of Clinton Cash: The Untold Story of How and Why Foreign Governments and Businesses Helped Make Bill and Hillary Rich. Schweizer recently published Secret Empires: How the American Political Class Hides Corruption and Enriches Family and Friends. We chatted over email about his new book and political corruption.
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Adam Rubenstein: Secret Empires is a lengthy compilation of research into what you call “corruption by proxy.” What exactly is “corruption by proxy?” How is it practiced in the American system? Who benefits and who’s harmed?
Peter Schweizer: The political class is learning. They realize that direct corruption is easy to detect. If you put $90,000 of cash in your freezer it looks pretty bad. So the money gets steered to the adult kids of politicians; their best friends; or extended family. It’s less direct, but its still corruption. And as far as the law is concerned, bribery is bribery. It’s the same thing, whether the money or benefit goes directly to the politician or a family member. It’s still a crime.
AR: Among those whom you’ve investigated are Hunter Biden and Devon Archer and their venture, Rosemont Seneca Partners. How, in this case, were the families of political elites able to profit on their relationships with John Kerry and Joe Biden?
PS: This is one of the most glaring cases in the book. In December 2013 Hunter Biden, son of Joe Biden, travels with his father aboard Air Force Two to Beijing. The vice president is negotiating a bunch of very sensitive issues with the Chinese, including the South China Sea, trade, tech transfer, etc. Biden is criticized on that trip for basically going soft on Beijing. Shortly after they return to the U.S., Hunter Biden’s firm receives a $1 billion private equity deal from the Chinese government. Not from an American business in China; from the Chinese government itself. It later gets increased to $1.5 billion. We have no way of knowing how much Rosemont made on the deal because there are no disclosure requirements. That’s part of the problem.
AR: There has been much concern, I think rightly, about emoluments during the Trump presidency—that is, that the president and other officials could profit from the office they hold. But you write in Secret Empire that this, too, was a problem in the Obama White House with billionaire Secretary of Commerce Penny Pritzker, the heiress to the Hyatt hotel fortune. The cases, though not perfectly analogous, are fairly similar. In what ways might Pritzker have profited from office? Could influence be purchased through staying at Hyatt hotels, in much the same way as influence is thought to be purchased today, through staying at Trump properties?
PS: I recognize that the emoluments issue has received a lot of attention during the Trump presidency, but as far as I’m concerned it’s a minor issue. The notion that foreign diplomats, for example, are going to curry favor with Trump by running up the bar tab at a Trump hotel really misses the much larger issue. We are way past that. Foreign entities are doing major deals with the family members of politicians. They don’t need to be that discreet. But to your point, the emoluments clause applies to U.S. “officials,” not just the president of the United States. And the same concerns about Trump should definitely be applied to Penny Pritzker while she served as commerce secretary. In her case, the conflicts were even worse than they are for Trump. As commerce secretary she had a commercial real estate firm that leased properties to the federal government, including her own department. And they also signed new leases during her tenure with lobbying organizations who were seeking favors from the Commerce Department. None of that can be said of Trump at this point.
AR: Can you describe the extent to which “corruption by proxy” is the mode of the Trump family? The affairs of the Kushner family and Qatar are in the news; Eric and Donald Jr. are managing their father’s portfolio; how has this been, and how can it be exploited by special interests? What can be done to guard against this type of corruption in the future?
PS: We are approximately 15 months into the Trump presidency. Thus far there have been no large sweetheart deals that I have been able to detect involving foreign entities. But mark my words: They will be offered them. The Chinese have been quite explicit about their strategy: They want to soften Trump’s policies on China by going through his kids. And they plan to do that by offering them lucrative deals. As I say in the book, for the sake of the country they need to resist those deals at all costs.
AR: Your book Clinton Cash, on the affairs of the Clinton family, was published about three years ago. Lawrence Lessig said of it, “on any fair reading, the pattern of behavior that Schweizer has charged is corruption.” Where does the book stand today? What do you think it proved?
PS: I think Clinton Cash proved that the Clintons engaged in wildly corrupt behaviors while Hillary Clinton was secretary of state. I think the book has held up very well. It’s a point of pride for me that, as the Wall Street Journal reported on its front page, the book spawned an FBI investigation into the Clinton Foundation that is still ongoing.
[Editor’s note: A previous version of this article misstated Peter Schweizer’s biographical details; as now noted above, Schweizer is the president of the Government Accountability Institute.]
