The Explainer: For love of money

For love of money

Manolo Quezon – The Explainer

Posted at Feb 14 2017 05:22 AM

If you belong to a certain generation you’ll remember Ninoy Aquino’s joke. He quoted a Japanese who enthusiastically told an audience, “You Firipinos are rucky. You have a president who robs you, and a First Lady who robs you even more!”

The question of private gain from public service predated Marcos, of course. St. Paul did not say money was the root of all evil. He said the love of money was the root of all evil. If the question of avarice, or greed for money, carries with it a moral dilemma, what happens when it also becomes a legal problem?

It’s interesting that as we look forward to the day of love, Valentine’s Day, Donald J. Trump and his love for making the deal to make lots of money, is now the hot topic in America. We forget that somehow, Trump and Marcos have a couple of curious connections.

The first is Paul Manafort. Before Manafort became Trump’s campaign chairman, thirty plus years ago he gained fame and fortune lobbying for clients like Ferdinand Marcos.

Marcos of course as part of his “robbing” –I mean, loving– his country, accumulated real estate abroad, including four buildings in New York City. One of them was a 1930s skyscraper: 40 Wall Street. After the building passed from the Marcos’ hands to other owners, Donald J. Trump sensed and opportunity and leased the building, making it one of the crown jewels of the Trump Organization.

Now of course Trump is president, the first one without any prior government experience, and the first to openly approach public governance from the point of view of business.

To be sure, that’s a pretty American point of view. As President Calvin Coolidge famously remarked, “America’s business is business.” Indeed, when you think of it, Americans are now discovering –and hotly debating—why it is there seem to be no real rules governing their presidents and making money.

George Washington, the first American president, was a man of means –just how much, we’ll discuss shortly—but when he became president, at first he didn’t want to take a salary. Others had to convince him that a salary was necessary because not every president could be expected to be rich, and a salary would keep a president honest.

After being president, however, you were on your own. President Ulysses S. Grant made a fortune after being president, then lost it when he covered the losses of investors in a scheme that went bust. Here, you can see him as he was dying of cancer, writing the memoirs that saved his family from poverty. He finished the book just days before his death.

But it wasn’t until Harry S. Truman, who was never any good at making money, that former presidents even got a pension after leaving office. And because his pension wasn’t very big, Truman would support the passage of the Medicare Act during the Johnson administration to ensure elderly retirees like himself could afford medicines.

During his presidency, Richard Nixon, who’d made money as a lawyer when he was out of office, faced a continuing inquiry into his tax returns, because like any good lawyer he was a genius at finding loopholes to claim deductions.

Other presidents who were multimillionares even before they became president, took a less active approach to money. Herbert Hoover, for example, never took home his salary. Instead, he donated it to charity.

John F. Kennedy, whose father had made a fortune and set aside money so that none of his children in politics would have to worry about earning a living, also donated his salary to charity.

This means Donald Trump is the third American president who has decided not to keep his salary, although it’s less clear if he is going to give it away.

The giving away of the presidential salary is an important point, because part of the debate over Trump’s decision goes back to Washington: in present day dollars, his fortune has been estimated as the equivalent of half a billion dollars in today’s money. Remember his not wanting to get a salary? He was told he had to do it, and that furthermore no president should have a choice over whether to take a salary or not –at most, the only choice should be, if you want to give it away, then ok.

But remember too, that there don’t seem to be many rules about the financial behavior of presidents in America? If Nixon got into trouble for his taxes, Trump refuses to release his tax returns. Only tradition, not the law, has made it a practice for presidents to disclose their taxes.

One reason for this weird absence of rules is being proposed: look at this map. It’s of Washington DC, the capital of the United States. The man who picked the site of the capital was George Washington himself.

You see, he was a land surveyor by profession. He was big on real estate. And throughout his life, one of his ruling passions was making money through real estate. It’s being suggested by some historians that Washington, who had his estate in Mount Vernon which is in this general neighborhood, chose the site for the city named after himself, because its location at the fork of the Potomac River promised a commercial and thus, real estate boom. One he would profit handsomely by, because he lived in the area.

Truth be told, if you aren’t going to steal from the public treasury then speculation in land has proven to be the time-tested way for politicians to turn a profit.

But whether you agree with this or not, Washington and his generation did agree on one limit to impose on presidents: they should not receive money from foreign governments.

And so, for Donald Trump, a provision in the United States Constitution is the sum total of limits on his money-making. The provision is called the Emoluments Clause.

The emoluments that are prohibited are those derived from foreign governments. The question is, in the present day, does this mean doing business with corporations abroad? When Century Properties in Manila, for example, pays a license fee for Trump Tower Manila, and the owner of Century Properties is a Philippine presidential envoy to Washington, would this put President Trump in the tempting position to modify his policies to suit his customers in Manila?

Everything else you see in the news: whether it’s OK for Trump to get mad at Nordstrom’s Department Store for not carrying his daughter’s fashion line, or his company’s continuing operations, and so on, can be boiled down into a debate over a Filipino word: delicadeza.

It’s only a hot topic in America because Trump is going against the traditions of the past. Traditions that put the appearance of correct behavior, at the same level with, or higher than, the law itself. But Trump can and has argued that’s just old-fashioned B.S. Legally, he might be right.

Which should serve as a reminder to us that sometimes, the past has to give way to the present. The only question is, will it be one that lets go of what the past hoped to do, which was to achieve some honor in public life, and just let things slide, or one that goes beyond keeping up appearances and locks presidents and politicians into some really tough rules, which is really what having the rule of law is all about.

Manuel L. Quezon III.

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