The ‘Biden Five’ and Abuse of Power
Top Democrat presidential candidate former Vice President Joe Biden has made his family millions through his power and influence. His former rival, Socialist Bernie Sanders, blasts Wall Street billionaires from the comfort of his politically acquired fortune. Ivanka and Jared Kushner serve as presidential advisers thanks to their connection to the boss. Investigative author Peter Schweizer uncovers the truth about money in politics for Die Weltwoche.
In the course of the impeachment proceedings against President Donald Trump, Peter Schweizer caused a sensation when he revealed that Hunter Biden, son of former US Vice President Joe Biden, was making millions in lucrative dealings with Ukraine’s largest private gas producer, Burisma Holdings, as well as a billion-dollar private equity deal with the Bank of China.
As vice president, Biden had served as point person on American policy for both Ukraine and China. In both instances, Hunter landed deals he was apparently unqualified to score save for one crucial factor: his father.
In his new book, "Profiles in Corruption," Schweizer documents how Biden put the “vice ” in his vice presidency to make his family rich. Schweizer also exposes how the progressive political elite in the US – among them Elizabeth Warren, Amy Klobuchar and Bernie Sanders — use their political power to become progressively more wealthy. They may preach economic justice for the common man, but Schweizer unmasks the Leftist elite’s unbridled eagerness to rig the system for their own private financial benefit.
Corruption and charity economy are nothing new in politics. Peter Schweizer, what makes the Biden case particularly delicate?
I think that everyone recognizes that in American politics if your last name is Bush or Biden, you're going to have certain inherent, inherited advantages. That's just the nature of human affairs. What I think happened in this case, though, is something far more troubling which are foreign entities, in this case Ukrainian oligarchs and the Chinese government, sought to buy favor and access to a top American decision-maker by providing lucrative deals to his family members. For me, this goes to the heart of what I call “legalized corruption.” The worst corruption I think oftentimes involves activity that's not necessarily illegal. Maybe it should be. But it's currently not. But it goes to the core of trying to subvert the decisions that our leaders are making in attempts to essentially bribe them through legal transactions involving their family members.
In the case of China, it's very clear. Hunter Biden was not qualified for the deals that he got. It was a deal involving the Chinese government. His group was the only non-Chinese partner. It was a special deal that no other firm had — not Goldman Sachs, not UBS, not Deutsche Bank — just this small firm. The deal was finalized when he traveled on Air Force Two with his father while his father was meeting with senior Chinese officials.
How much did he make? Is there an amount that you could trace in documents?
There are lots of documents. What he has received, and his firm has received, are ownership stakes in the companies in which they invested. This is a common approach in these sorts of private equity deals. There have been estimates, and these are only estimates, that his personal stake could be $30 million or more. There was a professor, I believe at the University of Chicago, who gave this thought. I think it's FactCheck.org which is one of these fact-checking websites. But it's all speculation, and this is part of the problem.
One of the reasons why there's so much of what I call “offshore corruption.” In other words, Joe Biden is not going to take the deal. His wife is not going to take the deal because they're required to disclose their finance. But his son can take the deal, and there is no disclosure whatsoever. The deal could be $30 million. It could be 10 times that amount. We don't know. But we won't know because there's no disclosure requirements. I think that's part of the problem here.
When this subject came up in 2019, Biden declared, “I never talked with my son or my brother or anyone else — even distant family — about their business interests. Period.” Is this true? Are there documents that prove he is lying?
Well, we know first of all that his own son, Hunter Biden, has contradicted him in an interview that he gave to The New Yorker magazine. He said that he did talk to his father about the deal with Ukraine. We also have a contradiction, I mentioned this in the book, of his son-in-law who is involved with a company called “StartUp Health” which is a business that he's one of three individuals in. He recounts in his own words that his father-in-law, Joe Biden, set up meetings with Barack Obama in the Oval Office after they had been discussing his business. You now have two family members who just flat, out in their own words, have said, that that is not just true or accurate.
To me, it rings sort of absurd. For example, Hunter Biden we know flew with his father on Air Force Two for the trip to China. The suggestion that they're going to be on a plane for who knows how many hours, and there's going to be no discussion of their business activity? It's just laughable.
But Hunter is just the tip of the iceberg. Joe Biden helped his closest family members. You call them the “Biden Five.” Hunter, Biden’s brothers James and Frank, his sister Valery, and daughter Ashely. They apparently knew the currency of the Biden name and got very good deals while Joe was vice president. How did they profit?
I think what's interesting about Joe Biden is how systematic and widespread he has used his position in office to enrich his family. You see his brothers having various business ventures. His brother James, for example, becomes involved with a newly-formed construction company. James becomes the executive vice president even though he has no background in construction. Within six months, they're landing large contracts with the federal government related to Iraqi reconstruction or involving other construction projects that the Federal government is funding. This is during the time that Joe Biden is vice president and Joe Biden is playing an important role in the Iraqi reconstruction initiative.
I think the consistent thread here is Joe Biden seeing the power that he has as an opportunity to use that power for the benefit of his family.
There's a story in the Biden chapter that I think is particularly telling. Everybody in the United States, at least, is very familiar with the story that Joe Biden would ride Amtrak train system regularly between is house in Delaware and his hoffice in Washington DC. That became part of his identity.
He was called the “Amtrak senator.”
Delaware newspaper stories point to the fact that if he was running late, he would have the train wait until he got there.
Because his son was on the Amtrak board.
Yes. Exactly. His son was on the Amtrak board. It speaks to me this duality that Joe Biden wants to talk about the fact that he is the everyman, but he is very, very willing and able to use his power and his influence and his position for the benefit of his family. It can be in small ways, albeit at the inconvenience of other people, which is holding up trains, but it could also be benefiting the family on deals overseas. Whether that's his brother Frank and his deals in Central America and the Caribbean, his son's deals in China and Ukraine, or the contracts that his brother's company has secured involving the state department in Iraqi reconstruction.
Why has Joe Biden been allowed to get away for so many years with all these deals?
It's a good question. I think it's a combination of things. I think, first of all, within the US Senate, there's very much a club atmosphere. Fellow senators are not prepared to call out fellow senators for this sort of behavior. I think it's a problem, and it needs to change. I think the other challenge is that the more complicated stories, like the trip to China and the deals in China, are complicated. They're hard to research.
In that particular case, I think it took us probably nine months to get to the bottom of it. I think a combination of it is there's a club atmosphere among the political elite in Washington that transcends party differences. I also think the complicated nature of these transactions make them difficult. I think the third thing that has helped Joe Biden is the fact that he's worked very hard to cultivate the image that he's a regular guy. He doesn't have a lot of assets. This, of course, demonstrates that, yes, he at the time did not have many assets. But that's because the deals were essentially being offshored. The beneficiaries were his family members. I have to give him credit. It's a very sophisticated, if troubling, way to handle these kinds of financial entanglements.
You went to great lengths to research the book. What are your sources? Can you tell us about your forensic research?
We're very proud of the fact that we do not use any anonymous sources in our research in our books. If you look at Profiles in Corruption, I forget the exact amount, there are over 1,100 endnotes in the book. When you look at the endnotes, the endnotes are oftentimes corporate documents. They may be court records involving court cases or financial documents that have come from court cases. They come from business publications. They come from, for example, news outlets or corporate records in China.
Everything we say in the book is supported by documentation and evidence. This is not an anonymous source that we're trusting to tell us the right thing. We do interviews with people in that sense. We really want to follow forensically the trail. I think that the research shows that very strongly. You see that the Biden response has been to essentially either attack me or, without going into any detail, saying that it's just not true, but not challenging the documents, challenging the research or challenging the evidence. That's the way we've done things, and that's the way we will continue to do things.
Your book does not focus on the Biden Five alone. You cover political prominence like Klobuchar, Warren, Sanders. Sanders, especially, seems to be an interesting case because he appears as a humble Socialist fighting the giants of Wall Street. But even Sanders is not void of corruption it seems. It all started in the 1980s, as you write, through his wife Jane Sanders who was appointed to several positions of influence when he was mayor of Burlington. What happened there?
Bernie Sanders was elected mayor of Burlington, Vermont at the age of 39, and that gave him his first position in public authority. He set the pattern pretty early on. As mayor of Burlington, one of the first things he did was appoint his then-girlfriend, later wife, Jane to a position in city government. This was not approved by the city council which was run by Democrats. They objected, and he simply ignored them. That was the beginning of a pattern by which Bernie Sanders has used his political office for the benefit of his family.
When he ran for federal office, for Congress, and then for the United States Senate, he realized that you can make a lot of money. And an individual can make a lot of money by doing media buying which is serving, in a sense, as the broker who is buying television and radio ads for political campaigns. All campaigns do this. But what Bernie Sanders did was make his wife the media buyer for his political campaigns which means she got the commissions, and that benefited the family financially.
It's always for me been an interesting paradox once I discovered this gap between his rhetoric and the reality. This yawning gap between what he professes are his views towards wealth and money, and what his own actual personal practices are. I think the most telling is the fact that really beginning in the 1970s when he was running for the US Senate as the third-party candidate, he began using a phrase that he would use for the next 35 years which was, "Our politics are dominated by billionaires and millionaires."
He stopped using that rhetoric around 2016 and denounced the fact that our politics were dominated by billionaires. The question is why did he now exclude millionaires? The reason is because he had become one. He became one in part because of the deals involving his wife. He also became one because of the book deals. He sells a lot of books which, as an author, I certainly appreciate and can respect. But he's also used campaign money, his own campaign money, more than $500,000 to buy copies of his own books which I think certainly is not appropriate and means that he has boosted not only his sales but the amount of money that he gets on future contracts.
Abuse of power knows no party lines. After Trump won the presidency in 2016, he handed the running of the Trump Organization to his sons, Don Jr. and Eric, and said they wouldn’t do any new overseas deals. But they still make money overseas, as the New York Times reported: “Both sons have operated and promoted the Trump family business overseas during their father’s presidency, even as he retains ownership.” Has Trump done enough to separate powers?
I'm not a fan of his daughter or son-in-law (Ivanka and Jared Kushner) serving on White House staff. I think that's a mistake, and I said that from the beginning. I think anytime that you blur those lines it creates a problem. That said, it curiously offers us more insight into the family finances because the fact that they serve in the White House staff means they have to disclose their financial holdings, but still on balance I think it's a terrible idea to have family members.
When Trump was elected and then inaugurated in January 2017, I co-wrote a piece in The Washington Post with a gentleman who was Barack Obama's ethics czar. In that piece, we laid down I think it was six or seven things that we believe President Trump needed to do in order to create a wall between his personal finances and his role as president of the United States. I think if you look through that list, he's actually done a fairly good job of creating a bright line there. It doesn't mean that there aren't issues that can come up. In my book Secret Empires, which came out in 2018, I raised concerns that China was going to be looking to do deals with the Trump family in the hope of weakening Donald Trump's position on China. I haven't seen any of those deals come to fruition yet. I hope they don't. We're going to continue to monitor them. This is an unfolding story that we need to continue to monitor and watch.
Let’s talk about the $2 trillion coronavirus bailout and President Trump-owned businesses being specifically excluded by Congress voting on the bill. Forbes is estimating that Trump lost $1billion in the past month. Do you think it was unfair that Trump’s businesses were specifically excluded?
I do. My view is looking at this bailout, I look at it a little differently than I do the Wall Street bailout of 2008 or 2009. My view was that the previous financial crisis was largely, not completely, but largely caused by financial firms over-leveraging, financial firms selling basically crap mortgage-backed securities. Those that were most directly affected were responsible for what had happened. In this particular case where the government because of a health concern has essentially forced businesses to shut down to stop doing business, I don't think it's a question of holding the businesses to account. This is not their fault. This is not irresponsible behavior on their part.
I think to exclude anyone, including the president's business is wrong. I think in this case it was pretty petty because you can look at a list of all sorts of American politicians. Senator Dianne Feinstein of California, for example, a Democrat, her husband, Mr. Blum has huge commercial holdings, particularly in commercial real estate, and he is going to benefit from this bill. Do we really want to start just carving out and saying, "This person gets in but this person does not"? I think that's a very petty way to do it in the crisis. That's my view on it.
Trump golf courses and hotels are in the same situation as other hotels and golf courses. They've had to shut down because of a government edict. They're not facing financial challenges because of stupid decisions they made. They've been told to shut down. So, they ought to be covered as every other business is covered.
Beyond the people who are already in the headlines, like Senator Richard Burr, are there elected officials who we should keep our eye on profiting from coronavirus or limiting their losses or perhaps helping out their cronies?
I just put up on Twitter and on Facebook yesterday in Barron's the financial publication about some of Nancy Pelosi's trades that her husband made on the eve of coronavirus. I think we're going to see more instances of this. I think we also have to closely monitor how the Treasury secretary handles the bailout dollars. He has a fair amount of latitude in who is going to get what.
If you look back at the stimulus bill that came out of the 2008-2009 financial crisis under the Obama administration, and I've written about this before in my book, Throw Them All Out, those dollars tended to flow to financiers who helped fund Barack Obama's 2008 campaign. I think we need to be watching and ensuring that that does not happen this time. I think invariably this is something that you expect to happen simply because it's human behavior. But we need to monitor it, and we need to call it out when it happens.
You quote founding father George Washington who once wrote, "Few men have virtue to withstand the highest bidder." It turns out that what Hunter Biden did was legal “and that is the problem," as you say. How can these glaring loopholes be closed and corruption be stopped?
It's a great question. I think it's very hard to fix all of these problems with a new law because they will find a way around the law. I think what we need to do in the Hunter Biden case is there needs to be greater disclosure. What do I mean by that? In the United States, a guy like Joe Biden has to disclose that he has $1,000 in General Electric stock. He has to disclose if someone makes a $250,000 contribution to his political campaign. But if his son does a private equity deal with a foreign government, China, worth $1 billion, then $1.5 billion, there's no disclosure requirement. To me, that is patently absurd.
I think there needs to be greater disclosure involving immediate family members, particularly when you're talking about foreign governments or foreign oligarchs. Greater disclosure is part of it. I also think there needs to be investigation, whether it's by the Department of Justice or whether it's by congressional committees, because we don't know the extent of these deals. There could be more deals. We don't know when they happen, we don't know what the terms of them are. In committing in Congress to move its subpoena power to ask Hunter Biden to come and testify, to ask other family members of politicians to come and testify, the big hurdle here, of course, is what I began the conversation with which is this club atmosphere in the Senate. There are a lot of people in the Senate who are either friends with Joe Biden or their family members and are doing things similar to Hunter Biden, or they are aspiring to do things that are similar to Hunter Biden. The self-policing by Congress is a very very difficult thing to do. I think disclosure is the key because people are still frustrated and angry when they see or hear about these sorts of things going on.
You write, "The lawmakers set the system up this way for a reason, and they will not stop the foreign cash influence game voluntarily."
Peter Franz Schweizer, 56, is a leading US investigative journalist. His books have been hitting the New York Times bestseller list. The descendant of Swiss emigrants - his grandfather lived in Zurich until his death - is President of the Government Accountability Institute (GAI). Schweizer gained international recognition for his investigative book "Clinton Cash" about the financial entanglements of the Clinton Foundation with foreign companies.