How Jared Kushner, his business, and his “limited life experience” offered China an opportunity for influence inside the White House
Adam Entous and Evan Osnos write for The New Yorker:
In early 2017, shortly after Jared Kushner moved into his new office in the West Wing of the White House, he began receiving guests. One visitor who came more than once was Cui Tiankai, the Chinese Ambassador to the United States, a veteran diplomat with a postgraduate degree from Johns Hopkins University. When, during previous Administrations, Cui had visited the White House, his hosts received him with a retinue of China specialists and note-takers. Kushner, President Trump’s thirty-seven-year-old son-in-law and one of his senior advisers, preferred smaller gatherings.
Three months earlier, Cui had been in near-despair. Like many observers, he had incorrectly predicted that Hillary Clinton would win the 2016 election; his botched forecast, he told a friend, was precisely the kind of error that dooms the careers of ambassadors in the Chinese diplomatic system. To make matters worse, Cui knew almost nobody in the incoming Administration. Donald Trump had won the election in part by singling out China for “raping” the United States.
In Kushner, Cui found a confident, attentive, and inexperienced counterpart. The former head of his family’s real-estate empire, which is worth more than a billion dollars, Kushner was intent on bringing a businessman’s sensibility to matters of state. He believed that fresh, confidential relationships could overcome the frustrations of traditional diplomatic bureaucracy. Henry Kissinger, who, in his role as a high-priced international consultant, maintains close relationships in the Chinese hierarchy, had introduced Kushner to Cui during the campaign, and the two met three more times during the transition. In the months after Trump was sworn in, they met more often than Kushner could recall. “Jared became Mr. China,” Michael Pillsbury, a former Pentagon aide on Trump’s transition team, said.
But Cui’s frequent encounters with Kushner made some people in the US Government uncomfortable. On at least one occasion, they met alone, which counterintelligence officials considered risky. “There’s nobody else there in the room to verify what was said and what wasn’t, so the Chinese can go back and claim anything,” a former senior U.S. official who was briefed on the meetings said. “I’m sorry, Jared — do you think your background is going to allow you to be able to outsmart the Chinese Ambassador?” Kushner, the official added, “is actually pretty smart. He just has limited life experiences. He was acting with naïveté.”
Kushner Enters the White House
By now, Americans are accustomed to reports of Russia’s efforts to influence American politics, but, in the intelligence community, China’s influence operations are a source of equal concern. In recent years, the F.B.I. and the C.I.A. have dedicated increased resources to tracking efforts by the Chinese government to spy on or to enlist Western officials in pursuit of their policy goals. (The F.B.I. and the C.I.A. declined to comment on this.) “The Chinese influence operations are more long-term, broader in scope, and are generally designed to achieve a more diffuse goal than the Russians’ are,” Christopher Johnson, a former C.I.A. analyst who specializes in China, said. “To be unkind to the Russians, you’d say they are more crass.”
Kushner often excluded the government’s top China specialists from his meetings with Cui, a slight that rankled and unnerved the bureaucracy. “He went in utterly unflanked by anyone who could find Beijing on a map,” a former member of the National Security Council said. Some officials who were not invited to Kushner’s sessions or briefed on the outcomes resorted to scouring American intelligence reports to see how Chinese diplomats described their dealings with Kushner. Other U.S. officials spoke to Cui directly about the meetings. Kushner was “their lucky charm,” the former N.S.C. member said. “It was a dream come true. They couldn’t believe he was so compliant.” (A spokesman for Kushner said that none of the China specialists told him that “he shouldn’t be doing it the way he was doing it at the time.”)
Kushner was still getting an education in the world of national security. His transition from business to public service had been abrupt; even as he took on the responsibilities of a statesman, with a portfolio that ranged from China to the Middle East to Mexico, he was waiting to receive a permanent security clearance. Shortly after Trump won the election, disagreements emerged inside the transition about whether to seek the type of clearances, overseen by the F.B.I. and other agencies, that would allow Kushner; his wife, Ivanka Trump; Donald Trump, Jr.; and Eric Trump to receive classified briefings. Some transition officials thought it was inappropriate to dispense such clearances until the Trump children’s roles in government became more defined. On November 16th, after multiple news organizations reported the impending requests, President-elect Trump disputed them in narrow terms, tweeting, “I am not trying to get ‘top level security clearance’ for my children. This was a typically false news story.” (A Kushner spokesman said that Kushner was unaware of any such requests made on his behalf.)
On January 9th, Trump announced that Kushner would join the Administration, and two days before Trump’s Inauguration an aide submitted Kushner’s request for a security clearance. The application was troubled from the start. After failing to list any contacts with foreign governments, among other incomplete sections, Kushner’s office filed a supplement the next day, citing numerous contacts and promising to assemble a complete list. (Kushner blamed a “miscommunication,” which caused the aide to file a “draft” prematurely.) In May, Kushner’s office sent another supplement, listing more than a hundred contacts from more than twenty countries.
Some of Kushner’s meetings during the campaign and the transition have caused problems for him. In June, 2016, he attended a meeting with a Russian lawyer, which Donald Trump, Jr., had arranged after he was told that she was aware of information, possessed by the Kremlin, that would “incriminate” Hillary Clinton. (Kushner updated his security forms once more, in June, 2017, to include the meeting.) On December 1, 2016, at Trump Tower, Kushner and Michael Flynn, a retired general and Trump’s designated national-security adviser, met with the Russian Ambassador, Sergey Kislyak, who, according to Kushner, offered to deliver information about the war in Syria over a secure line. Kushner asked if the Russian Embassy had a communications channel that “we could use, where they would be comfortable transmitting the information they wanted to relay to General Flynn.” (Members of Congress harshly criticized Kushner for suggesting the use of Russian channels.)
Some of Kushner’s meetings during the campaign and the transition have caused problems for him. In June 2016, he attended a meeting with a Russian lawyer, which Donald Trump, Jr., had arranged after he was told that she was aware of information, possessed by the Kremlin, that would “incriminate” Hillary Clinton. (Kushner updated his security forms once more, in June, 2017, to include the meeting.) On December 1, 2016, at Trump Tower, Kushner and Michael Flynn, a retired general and Trump’s designated national-security adviser, met with the Russian Ambassador, Sergey Kislyak, who, according to Kushner, offered to deliver information about the war in Syria over a secure line. Kushner asked if the Russian Embassy had a communications channel that “we could use, where they would be comfortable transmitting the information they wanted to relay to General Flynn.” (Members of Congress harshly criticized Kushner for suggesting the use of Russian channels.)
As months passed, some members of the White House received their permanent security clearances, but Kushner continued to wait. For high-level appointees, the process is normally “expedited,” a former senior U.S. official said. It can be completed in several months, unless “derogatory information” pops up during the review.
Kushner had an interim clearance that gave him access to intelligence. He was also added to a list of recipients of the President’s Daily Brief, or P.D.B., a top-secret digest of the U.S. government’s most closely held and compartmentalized intelligence reports. By the end of the Obama Administration, seven White House officials were authorized to receive the same version of the P.D.B. that appeared on the President’s iPad. The Trump Administration expanded the number to as many as fourteen people, including Kushner. A former senior official said, of the growing P.D.B. distribution list, “It got out of control. Everybody thought it was cool. They wanted to be cool.”
Some people in the office of the director of National Intelligence questioned the expansion, but officials who reported to Trump didn’t want to risk irritating him by trying to exclude his son-in-law and other new additions. David Priess, a former C.I.A. officer who delivered the P.D.B. during the George W. Bush Administration and is the author of “The President’s Book of Secrets,” said that Kushner’s situation was unprecedented: “Having studied the President’s Daily Brief’s six-decade history, I have not come across another case of a White House official being a designated recipient of the P.D.B., for that length of time, without having a full security clearance.”
Among national-security specialists, Kushner’s difficulty obtaining a permanent security clearance has become a subject of fascination. Was it his early failure to disclose foreign contacts? Or did it have something to do with the investigations into Russian interference in the 2016 elections? As the Administration finished its first year, some clues to Kushner’s security troubles have come into sharper focus, giving a new perspective on his encounters with China.
Business and the China Link
efore arriving in Washington and taking up his unusual role as son-in-law, confidant, and free-ranging foreign-affairs counsellor, Kushner had no particular familiarity with diplomacy. “My experience was in business, not politics, and it was not my initial intent to play a large role in my father-in-law’s campaign,” he said, in testimony before congressional committees last July, as part of the Russia investigations. Since 2008, he had served as the CEO of the Kushner Companies, the family firm, which has an office in Florham Park, New Jersey. Its assets included commercial real estate and twenty-two thousand apartments from New Jersey to Maryland.
Through his work, Kushner had established links to China. A Kushner project in Jersey City, which opened in November, 2016, reportedly received about fifty million dollars, nearly a quarter of its financing, from Chinese investors who are not publicly named, through a U.S. immigration program known as EB-5, which allows wealthy foreigners to obtain visas by investing in American projects. Kushner was also an investor, alongside prominent Chinese and Hong Kong businessmen, in multiple companies. He and a brother, Joshua Kushner, co-founded Cadre, a real-estate investment firm, which received funding from Jack Ma, the billionaire founder of Alibaba. (The scope of investors behind Kushner projects is unknown, because the company does not disclose the names.) Ivanka Trump has her own business endeavors in China, where some of her branded handbags, shoes, and clothes are manufactured.
During the campaign, Trump asked Kushner to be “a point of contact for foreign government officials.” Kushner, who was largely uninvolved with the transition team, devoted little attention to how he would handle those contacts in the event that Trump won.
Shortly before the election, aides prepared a memo for Chris Christie, at that time the head of the transition team, concerning the sensitive matter of conversations with foreign powers. “Because the current President is still in office, calls made during the transition period should be high level, non-substantive, and consist largely of diplomatic pleasantries,” they wrote. Trump would be “inundated with requests for thousands of calls from around the world,” they warned, through “campaign staff, outside advisers, and other third parties.” He must not accept them. Requests must be “methodically returned” in “a sequence of calls that will not create any diplomatic incidents or negative press stories.” The President-elect must have a classified intelligence briefing before conversations with foreign leaders, and then conduct the meetings only when a note-taker and a national-security aide are present. The aides suggested that Trump make five “waves” of calls over a number of days, starting with the United Kingdom and ending with Pakistan.
“Obviously, all that just got tossed aside,” a senior transition official recalled recently, because Trump was “excited that important people were calling him.” Trump spoke to more than two dozen heads of state before his campaign contacted the State Department. The freewheeling access extended to in-person meetings. On November 17th, Trump had his first meeting with a foreign leader, Japan’s Prime Minister Shinzo Abe. According to a transition official, the meeting had come about after Abe’s government contacted Ado Machida, a policy director for the Trump transition, whose father had served as one of Japan’s representatives to the United Nations. (Machida declined to comment.) In another break with protocol, Trump was accompanied to the meeting by his daughter and son-in-law, while they were still running their respective businesses.
From A Troubled New York Skyscraper to a Florida Summit
During the transition, Kushner met with a range of foreign officials to discuss the incoming Administration. At the same time, as the head of his family’s business, he was urgently seeking an infusion of cash to repay a debt totalling hundreds of millions of dollars. In 2007, the Kushner Companies had bought 666 Fifth Avenue, a forty-one-story office tower, for $1.8 billion, the highest price ever paid for a building in Manhattan at that time. The deal turned out to be a potential disaster for Kushner. Demand for office space had fallen short, and he was hunting for investors, in Asia and the Middle East, among other places, to shore up the building’s finances.
On November 16, 2016, Kushner had a private dinner with Wu Xiaohui, the chairman of China’s Anbang Insurance Group, to discuss Wu’s possible investment in 666 Fifth Avenue. Months later, when the meeting was revealed, and Bloomberg News reported that the Kushner family stood to make as much as four hundred million dollars from the agreement with Anbang, Democratic lawmakers, including Senator Elizabeth Warren of Massachusetts, criticized it as a possible conflict of interest. The companies abandoned the negotiations.
In some cases, it was unclear whether Kushner was representing the transition or his business. On December 13, at the recommendation of Sergey Kislyak, the Russian Ambassador, Kushner met with Sergey Gorkov, the head of Vnesheconombank, or V.E.B., a Russian state bank. Kushner and the White House have said that he was acting as a Trump adviser and did not discuss his business. But Representative Adam Schiff, of California, the top Democrat on the House Intelligence Committee, has raised concerns that Kushner was discussing business while serving the transition. Schiff pointed to statements by VEB and a spokesman for Russia’s President, Vladimir Putin, which suggest that Kushner held the meeting in his capacity as head of the Kushner Companies. On January 9, 2017, shortly before beginning work at the White House, Kushner said that he was stepping down as CEO. He sold his stake in 666 Fifth Avenue to a family trust, while retaining ownership of many of his assets.
As Trump prepared to enter the White House, he took a sudden measure that unnerved officials in Beijing. On December 2, encouraged by the fiercest anti-China hawks among his advisers, including Steve Bannon, at that time his chief strategist, Trump took a telephone call from the President of Taiwan, Tsai Ing-wen, breaking with nearly four decades of American diplomatic practice. The U.S. has friendly relations with Taiwan, but Presidents since Ronald Reagan have avoided speaking directly with Taiwan’s President, because, as part of its “One China” policy, the U.S. formally recognizes only the Beijing government. Then, in an interview, Trump mused about giving up the “One China” policy and recognizing Taiwan’s government, in Taipei.
Chinese officials turned to the man that Kissinger had recommended to them: Jared Kushner. Kushner later told others that he took on the China portfolio reluctantly, after “clamoring” Chinese officials called Trump Tower and asked for him by name.
On December 9 and 10, Cui Tiankai and Yang Jiechi, China’s top diplomat, visited Kushner at his office at 666 Fifth Avenue. Unlike officials from Japan and the United Arab Emirates, who were secretive about contacts with Trump’s transition team, the Chinese diplomats kept the Obama Administration informed. After visiting Trump’s transition team, Yang called the White House to report the encounter.
At times, Flynn and others joined the meetings. Laying out China’s hopes and ambitions for its relations, Cui urged the U.S. to expand military-to-military exchanges and to endorse the Belt and Road Initiative, a foreign infrastructure campaign intended to expand Chinese influence abroad. According to a participant in the discussions, Flynn welcomed the overture, praising the Belt and Road Initiative and saying that, although the US had just one government at a time, he appreciated “beginning dialogue now.”
After Trump’s Inauguration, on January 20, Kushner’s contacts with Cui intensified. They met again on February 1st, and, that day, Ivanka took her daughter, Arabella, to a lunar New Year celebration at the Chinese Embassy. Later that month, Kushner persuaded Trump to back off his threat to abandon the “One China” policy. Kushner also passed along proposals from Cui to Secretary of State Rex Tillerson, who made his first official trip to Beijing in March. During the visit, Tillerson startled China experts by adopting some of Beijing’s official phrases, including “mutual respect”, which is often interpreted as reinforcing China’s claims over disputed waters in Asia.
Kushner and Cui also met repeatedly to prepare for Trump’s first meeting with China’s President Xi Jinping on April 6 at Trump’s Mar-a-Lago resort. Daniel Russel, who, until last March, was the Assistant Secretary of State for East Asian and Pacific Affairs, and is now a diplomat-in-residence at the Asia Society, in New York, said, “It was clear that heated arguments were taking place among the President’s advisers.” On one side, hard-liners, including Bannon, who has said he believes that China is “bent on world domination”, advocated a confrontational stance on trade and other issues. On the other, according to Russel, “Jared Kushner was described as adamant that Mar-a-Lago should be exclusively about bonding.” Russel continued, “We were told that the theory was to first establish a warm family friendship, using meals and Trump’s personal charisma.”
In the event, China overwhelmingly achieved its objectives: a soft-focus summit with regal photo ops and little talk of trade and other touchy subjects. It was also an auspicious occasion for the Kushner family. While Xi met with Trump, Beijing regulators approved three trademark applications from Ivanka’s company, to sell bags, jewelry, and spa services. Ivanka is also an adviser to the President, and her deals with the Chinese were hardly unusual. Since Trump assumed office, the Chinese government has approved scores of trademark applications by the Trump Organization.
Kushner was proud of his role in the summit, telling a person close to him, “People say we ought to do things the way they always have been done, with the same approaches. Somebody with more experience, tied to the old ways, may not have necessarily been able to pull off the Mar-a-Lago summit like we did.” He added that the officials who have criticized his approach to foreign affairs “usually get pretty uncomfortable when they’re not in control of something and it doesn’t go the way they want”.
A Security Risk?
By the spring of 2017, investigators in charge of evaluating whether to give Kushner a permanent security clearance had new information to consider. US intelligence agencies aggressively target Chinese government communications, including Cui’s reports to Beijing about his meetings in the United States.
According to current and former officials briefed on U.S. intelligence about Chinese communications, Chinese officials said that Cui and Kushner, in meetings to prepare for the summit at Mar-a-Lago, discussed Kushner’s business interests along with policy. Some intelligence officials became concerned that the Chinese government was seeking to use business inducements to influence Kushner’s views. The intelligence wasn’t conclusive, according to those briefed on the matter. “I never saw any indication that it was successful,” a former senior official said, of Chinese efforts to compromise Kushner. The Chinese could have mischaracterized their discussions with Kushner. But the intelligence reports triggered alarms that Chinese officials were attempting to exploit Kushner’s close relationship with the President, which could yield benefits over time. “They’re in it for the long haul,” the former official said. (A spokesman for Kushner said, “There was never a time—never—that Mr. Kushner spoke to any foreign officials, in the campaign, transition, and in the Administration, about any personal or family business. He was scrupulous in this regard.”)
In March, 2017, Bill Priestap, the FBI’s chief of counterintelligence, visited the White House and briefed Kushner about the danger of foreign-influence operations, according to three officials familiar with the meeting. Priestap told Kushner that he was among the top intelligence targets worldwide, and was being targeted not only by China but by every other major intelligence service as well, including those of the Russians and the Israelis. Priestap said that foreign spy agencies could use diplomats and spies masquerading as students and journalists to collect information about him. (An F.B.I. spokesperson declined to comment.)
Priestap and Kushner discussed some of Kushner’s contacts, including Wendi Deng Murdoch, the ex-wife of Rupert Murdoch. Kushner and Ivanka Trump had known her for about a decade, and she was a regular guest at their Washington home. U.S. diplomats and intelligence officials have long speculated about Wendi Murdoch’s ties to the Chinese government. Internally, some Chinese officials spoke about her in ways that suggested they had influence over her, the former senior official, who was briefed on the intelligence, said. Other officials said that the intelligence was inconclusive.
The allegations against Wendi Murdoch are complicated by her divorce from Rupert Murdoch. On January 15th, some of the allegations were published in the Wall Street Journal, which is owned by Rupert Murdoch. (A spokesperson for Wendi Murdoch said, “The idea that she is involved in anything covert is so absurd, it could only have come from an unnamed source.” A spokesperson for Rupert Murdoch said that Murdoch does not believe Wendi is a spy.)
When Kushner was briefed by the F.B.I., he saw little cause for alarm, according to a person close to Kushner. He had no doubt that China and other countries were trying to persuade him to do things or to provide information, but he was, despite his inexperience in diplomacy and intelligence, confident in his ability to navigate these situations. After all, he told others, New York real estate is not “a baby’s business”.
Largely away from view, the U.S. and China are engaged in a heightened competition to steal sensitive information from each other and to manipulate foreign officials. Since 2016, Chinese authorities have expanded public warnings about the threat posed by American espionage. (In November, the Chinese Society of Education issued a video quiz for primary-school students, which included the question “What number should you dial when you spot spying activities?”) China’s intelligence services have demonstrated greater sophistication in seeking to compromise foreign officials, sometimes by using hacked information. In 2014, Chinese hackers copied a vast database from the Office of Personnel Management. Officials said that Beijing appeared particularly interested in identifying Chinese-Americans who were working for the US government, so that China could try to manipulate them into being of assistance.
For its 2017 budget, the Obama Administration requested nineteen billion dollars for cybersecurity, an increase of more than thirty-five per cent from the previous year. Earlier this month, the FBI arrested Jerry Chun Shing Lee, a former CIA officer, and charged him with unlawful possession of defense information. In addition to countering classic espionage, the US is considering new ways of managing how foreign powers lobby and seek to affect the American political system. A 2016 law has established an interagency unit to coördinate “counter-propaganda”, and bills proposed in October expand requirements of the Foreign Agent Registration Act, which regulates foreign influence in Washington.
American intelligence officials describe their Chinese counterparts with grudging respect. At the end of the Obama Administration, Russia and China topped the White House’s list of counterintelligence threats, largely because of their proficiency in electronic surveillance—intercepting phone calls and e-mails. The Chinese were not yet on the level of the Russians in the area of “human intelligence,” or spies and informants, a senior Obama Administration official said, “but they’re certainly improving, and they’ve been quite aggressive in recent years”. Michael Bahar, a former staff director and general counsel for Democrats on the House Intelligence Committee, said, “They are a professional service. They do their homework.”
“I Understand My Responsibilities”
In the months after Priestap briefed Kushner on the counterintelligence threat, Kushner and Ivanka Trump made some adjustments. In May, the Kushner Companies issued an apology after reporters observed Nicole Kushner Meyer, Jared Kushner’s sister, speaking about his White House position while promoting real estate to potential investors in China. In September, Kushner and Ivanka declined an invitation to visit China, amid criticism from some American scholars that they were ill-equipped to conduct diplomacy on behalf of the United States.
Other plans remained unchanged. In November, Kushner travelled to China as part of the President’s delegation for a summit with Xi Jinping. In Beijing, Kushner had lunch at the home of Wendi Murdoch, an occasion that went unmentioned in briefings and public schedules. (A White House spokesman said that Kushner attended the lunch “in a personal capacity,” after the President’s official business was complete.) Kushner saw no reason to curtail their friendship. In the seven months since Kushner’s meeting with Priestap, Wendi Murdoch had done nothing that raised his suspicions, according to a person close to Kushner. “Why do I have more of a risk of telling her state secrets than anyone else?” Kushner asked recently. “Either I’m qualified to handle state secrets or I’m not qualified to handle state secrets. I think I understand my responsibilities.”
In December, U.S. intelligence agencies briefed a wider circle of officials, saying that “a member of the president’s family” was being targeted by a Chinese influence operation, echoing earlier warnings. It was not clear if that family member was Kushner or someone else.
The President’s children resist the argument that their undivested assets, their behavior, and their willingness to mix government service and personal profit present a target to adversaries and allies alike. The senior transition official believes that’s a mistake. “They’re going to slowly, over time, get what they want out of him, and it’s not going to be obvious,” the official said. “Sure, you’ll take the meeting, but you’re giving them a real investment opportunity that’s ‘good for them,’ and ‘everyone wins.’ Meanwhile, they’re just trying to get their teeth into him.”
Kushner enters his second year in Washington facing increasing political and legal pressures. He has already testified before congressional committees about his meetings with the lawyer from Moscow, the Russian Ambassador, and the head of V.E.B. The F.B.I., too, is reportedly investigating Kushner’s Russian meetings. As details of his dealings with China come to light, they expose him to additional questions about the wisdom of his diplomatic efforts and the recurring risk that his work in government cannot be disentangled from his family’s business interests. This month, it emerged that the Securities and Exchange Commission and federal prosecutors in the Eastern District of New York had issued subpoenas to the Kushner Companies, for details about its use of the EB-5 visa program.
Kushner’s once expansive role in the White House has narrowed, and he no longer meets frequently with Ambassador Cui. Still, by his own description, he is as confident as ever that his instincts, honed in the family business, can serve him, and the country, well. In the White House, he has a lofty but precarious status. Henry Kissinger, who had encouraged Kushner’s dialogue with Cui, described Kushner as occupying a “daunting role flying close to the sun”.
Recently, a former teaching fellow from Kushner’s undergraduate days at Harvard recalled that Kushner took a popular class on the American Presidency, taught by Roger Porter, who had advised Ronald Reagan when he was President. At the end of the semester, Porter read aloud from “The Inner Ring”, a 1944 oration by C. S. Lewis. It was Porter’s warning to his ambitious students about the temptations that haunt higher office, and the allure of favor-seekers. “You will be drawn in, if you are drawn in, not by desire for gain or ease, but simply because at that moment, when the cup was so near your lips, you cannot bear to be thrust back again into the cold outer world.”