Ivanka Trump and White House senior adviser Jared Kushner listen as US President Donald Trump delivers a speech to the Arab Islamic American Summit in Riyadh, Saudi Arabia in 2017. Picture: REUTERS
Ivanka Trump and White House senior adviser Jared Kushner listen as US President Donald Trump delivers a speech to the Arab Islamic American Summit in Riyadh, Saudi Arabia in 2017. Picture: REUTERS

The Trump team is standing by Saudi Arabia and Crown Prince Mohammed bin Salman as the investigation and controversy surrounding the disappearance of journalist Jamal Khashoggi deepens.

On Tuesday, US secretary of state Mike Pompeo visited Riyadh for a photo op with the prince. In a press release, he praised the Saudi leadership for “supporting a thorough, transparent and timely” investigation into the Khashoggi affair, a full two weeks after he first went missing.

Pompeo also said that Saudi leaders denied any involvement in Khashoggi’s disappearance, something his boss, US President Donald Trump, let the world know on Twitter as well:

By Tuesday evening, that line became more complex to defend after the New York Times reported that at least four suspects in Khashoggi’s disappearance had ties to the crown prince. A fifth was “of such stature that he could be directed only by a high-ranking Saudi authority”, the newspaper said.

Complexity has never deterred the president, however. In an interview with the Associated Press on Tuesday, he blamed critics of Saudi Arabia for holding it “guilty until proven innocent”. Lest anyone doubt his motives, Trump took to Twitter to talk about his finances:

This statement would be easier to digest if Trump hadn’t bragged publicly in the past about how much Saudis have spent buying his condominiums — and if he wasn’t the steward of the most financially conflicted presidency of the post-Second World War  era.

Trump’s Saudi deals

Trump is playing word games, of course. He says he has no investments in Saudi Arabia or Russia. But that doesn’t mean money from those countries hasn’t flowed into his coffers. In Saudi Arabia’s case, this has meant very different things over the years.

In the early 1990s, Saudi billionaire Prince Alwaleed bin Talal bought Trump’s prized yacht on the cheap from the property developer’s creditors when he was on the cusp of personal bankruptcy. A few years later, one of Trump’s lenders forced him to sell the Plaza Hotel, a New York City landmark also mired in debt, to Alwaleed.

As David Fahrenthold and Jonathan O’Connell noted in the Washington Post recently, this was a period when Trump was trying to dig himself out of $3.4bn of debt, about $900m of which he had guaranteed personally. But Alwaleed was a bargain-hunter at the time, not someone trying to ensnare a failed developer on the unlikely chance that he might someday become president.

The Trump International Hotel in Washington has been a favorite venue for Saudi diplomats who have spent lavishly there, as well as at other Trump hotels

Still, Alwaleed, who once described Trump on Twitter as a “disgrace, not only to the GOP but to all America”, kept those early deals in mind. When Trump made fun of him on Twitter two years ago, Alwaleed responded by tweeting, “I bailed you out twice; a 3rd time, maybe?”

As Trump climbed out of his debt hole in the late 1990s and early 2000s, he courted Saudi condo buyers. The Saudi Arabian government bought the entire 45th floor of the Trump World Tower in 2001, and, before running for president, Trump was apparently contemplating doing business in Saudi Arabia — he incorporated eight limited-liability companies (LLCs) with names suggesting he planned to do business there (they were later dissolved).

Saudi Arabian policy linchpin

After becoming president, Trump flouted tradition by declining to authentically separate himself from the Trump Organization and its hotel and golf properties. The Trump International Hotel in Washington has been a favorite venue for Saudi diplomats who have spent lavishly there, as well as at other Trump hotels.

The president and his son-in-law, Jared Kushner, also decided to make Saudi Arabia a linchpin of their policy in the Middle East. Kushner, lacking full security clearance and any diplomatic experience, lobbied the crown prince directly in early 2017 to secure what was fancifully and inaccurately touted as a $110bn arms sale — most of which had been agreed a year earlier, and the bulk of which still hasn’t been completed.

Shortly after that transaction was arranged, Trump visited Saudi Arabia. And soon after that, the Saudis announced they would invest $20bn in an infrastructure fund managed by Blackstone Group. The New York-based firm had financed several of the Kushner family’s deals and its chair, Stephen Schwarzman, sat on the president’s business advisory council. The private equity firm told Bloomberg News that the Saudi investment had been contemplated long before Trump was even the Republican nominee.

Kushner’s forays alarmed members of the intelligence and national security communities, as Bob Woodward outlined in his book, Fear. At the very moment Kushner was throwing himself into these diplomatic adventures, he was coming under scrutiny for his own financial conflicts — in particular, his efforts to secure funding for 666 Fifth Avenue, a troubled Manhattan skyscraper his family owned.

Late last year, Kushner made another secretive trip alone to Riyadh ... Not long afterward, the crown prince placed dozens of prominent businessmen and political rivals under house arrest in what was described as an anti-corruption drive

Although the family has since sold off the property, Kushner had tried unsuccessfully to secure funding for it from a Chinese investor. His intersection with a prominent banker and diplomats from Moscow during the Trump campaign’s transition into the White House raised questions about whether he was courting Russian investors (which he denied). Inevitably, the Kushner family also courted a prominent Saudi investor to bail them out of 666 Fifth, as detailed by my Bloomberg News colleagues David Kocieniewski and Caleb Melby.

Late last year, Kushner made another secretive trip alone to Riyadh. He later described the visit as an effort to “brainstorm” Middle East strategies with Mohammed bin Salman. Not long afterward, the crown prince placed dozens of prominent businessmen and political rivals under house arrest in what was described as an anti-corruption drive. Among them was Alwaleed, the man who once snatched the Plaza Hotel and yacht from Kushner’s father-in-law.

Kushner targeted

Earlier this year, leaked intelligence reports revealed that diplomats in Mexico, Israel, China and the United Arab Emirates had decided to target Kushner because they believed he could be easily manipulated due to “his complex business arrangements, financial difficulties and lack of foreign policy experience”.

For his part, Kushner just ploughed ahead, continuing to rest the White House’s plans for the Middle East on the shoulders of an equally young and untested man, Saudi Arabia’s crown prince. The disappearance of a single journalist, a one-time ally of the royal family turned critic, may ultimately cause Kushner’s plans to unravel — and expose his machinations in Saudi Arabia to more revealing and unwanted scrutiny.

If it doesn’t, it may well be because Trump — putting the lie to his dissembling about his family’s financial ties to Saudi Arabia — will openly and stubbornly put money ahead of the moral and diplomatic issues at play in Khashoggi’s disappearance.

As he told Fox News in an interview on Tuesday night: “I don’t want to give up a $100bn order, or whatever it is.”

O’Brien is the executive editor of Bloomberg Opinion. This column does not necessarily reflect the opinion of the editorial board and/or Bloomberg LP and its owners.

Bloomberg 

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