Given the complex ongoing dealings between the Trump Organization and foreign governments, the Emoluments Clause of the Constitution will require Congress to “decide what it is willing to live with in the way of Trump conflicts” — and it should draw those lines before the fact, not after. That’s what I argue in a new Philadelphia Inquirer piece. Excerpt:
…Trump points out that the president is exempt from the conflict-of-interest laws that bind Congress and the judiciary, but that doesn’t mean he will escape scrutiny from public opinion or from the body of federal law as a whole, including the Emoluments Clause.
That clause reads in relevant part: “And no Person holding any Office of Profit or Trust under [the United States] , shall, without the Consent of the Congress, accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince, or foreign State.”…
The wording of the clause itself points one way to resolution: Congress can give consent, as it did in the early years of the Republic to presents received by Ben Franklin and John Jay. …
…it can’t be good for America to generate a series of possible impeachable offenses from a running stream of controversies about whether arm’s-length prices were charged in transactions petty or grand. …
There is no doubt that doing the right thing poses genuine difficulties for Trump not faced by other recent presidents. If he signals that he understands the nature of the problem, it would not be unreasonable to ask for extra time to solve it.
For more detail, Randall Eliason has a helpful explainer, e.g. on why Emoluments Clause issues do not map well onto the concept of “bribery.” (Bribery is subject to a separate ban, while both presents and some other payments can violate the Emoluments Clause even if given and received with the purest of motives.)
Update: With Trump’s announcement this morning that he intends to step back from management involvement with the Trump Organization, I’ve adapted this post into a longer piece at Cato at Liberty on what comes next. I quote Prof. Bainbridge, who’s got a second round of observations here.
Yet more: memos shed light on how the Department of Justice has construed the obligations of the Emoluments Clause over many decades. And the Washington Examiner, which recently welcomed Tim Carney as new opinion editor, suggests an “occluded trust.”
7 Comments
No problem. He can establish the “Trump Family Foundation”, and all business profits shall be directly donated to the trust. For purposes of the Emoluments Clause, and based on recent precedent, it need not be a blind trust. Paying out 5% of the income as charity should not be a burden, especially considering the generous charitable donations that would come in from world leaders.
And of course, his children would not be involved in his businesses, but would instead receive million-dollar honorariums for 30 minute speeches around the world. With multi-million dollar travel expenses funded by the trust.
While I can see potential for conflicts of interest, and violations of a number of federal ethics laws, some of which have possible criminal application, I just don’t see any Emoluments Clause issues — unless you know of some way the corporate veil of Trump’s various corporations and partnerships can be pierced. If merely owning ownership interests in juridical persons which do business with foreign States, then the corporate veil protects Mr. Trump — as it protects all of the Congressmen, U.S. Judges, military service members and federal employees who own stock in businesses engaged in international commerce (or, given the fact that most federal retirements involve investing in businesses that do at least some business involving international trade, approaching 100% of the federal workforce, military and civilian). Accordingly, I believe that in this instance you are painting with far too broad a brush.
In contrast to this, former President Clinton received large speaking fees from foreign governments. I do not pretend to be an expert in NY property law, but, I’d guess that Mrs. Clinton, then known as Secretary of State Clinton, owned a beneficial interest in 1/2 of the amounts her husband received. So, without even examining whatever her other interests, executive powers, and actions were concerning the Clinton Foundation, there appears to be much more plausible Emoluments Clause issues there, which were not the subject of discussion. However, if the fact that the check was made payable to him, and not jointly to them, satisfies the Emoluments Clause, then, Mr. Trump’s ownership and executive powers as to his various corporations and partnerships are much further removed.
If I’m incorrect on this, a fuller explanation than the one linked to, is warranted.
Thank you.
The Kingdom of Bahrain is hosting a reception at President-elect Trump’s hotel, and I suspect the venue was not chosen randomly. Meanwhile, President Obama still hasn’t refinanced his house because of the chance of a conflict of interest involved in taking out a mortgage as President.
Of course, Congress has been literally running and hiding from these questions, so they don’t seem to have much interest in creating a framework to address these conflicts.
If you marry a drunk who gambles, you really do not have the standing to complain when she drinks and gambles.
The same is true with Trump. He clearly telegraphed to the American people that he was going to address conflict issues in a superficial way. Is there a single person who is surprised that he is not taking the conflicts seriously? Has anyone said, “Wait, this is not what we bargained for?”
It is exactly what we bargained for which is why I am at peace with all of these conflicts. He is going to make a fortune off being president. There is little anyone can do about it and I’m just accepting the fact that he will find ways to profit like crazy from his position.
It’s hard for me to take seriously his statement today that he plans to step away from his business without much more detail. His business consists of his personal brand and a series of buildings prominently displaying his name. Simply relieving himself of the duties of management and signing checks is the absolute minimum we can expect, not on the grounds of avoiding a Conflict of Interest, but in simply having a full time President for a full time job. Leaving the management to his children, especially while relying on his family for advice on government business, poses just as much of a problem; the Old Post Office lease appears to be literally incompatible with his holding public office.
Professor Bainbridge is on to something with the structure he proposes, but it remains unclear whether the President-elect has any actual interest in avoiding conflicts of interest or if he’s merely looking to appear that he’s dealt with the matter.
Thank you for the additional references and explanation. However, I still don’t see an Emoluments Clause issue.
The definition of “emolument” is salary or fee. Trump will not receive any salary, fee, present or title from a foreign king, prince or nation, unless you can pierce the corporate veil. Otherwise, the argument boils down to: Based upon an undefined and legally novel indirect benefits theory, I am uncomfortable with having experienced, successful business persons holding important positions in the federal government, and using their knowledge, expertise and contacts, to make important decisions and formulate policy. In short, only professional politicians, and amateurs may hold federal offices.
That may seem harsh, but, I listed to a discussion involving an “expert in government ethics” on NPR, and, that was the takeaway. The objection (other than the unstated one that “Trump is Bad”) was that because Trump (and his team) know how international commerce actually works, they will make decisions that benefit US businesses, including Trump’s, and that is therefore bad, because his interests will benefit along with everyone else’s. Further, the press will be skeptical of Trump’s decisions and policies because of that. (Actually, given the lack of investigations as to the current administration and the Clinton Foundation, seeing actual investigative journalism would be a refreshing change. However, I have doubts that there are many actual investigative journalists in the MSM).
I see possible problems or questions with laws forbidding quid pro quo deals, and bribery, and influence peddling, etc., but, those are fact specific, and can be addressed if they arise. Accordingly, I still fail to see an Emoluments Clause issue.
“Piercing the corporate veil” in law is a concept that ordinarily applies to the question of whether *liabilities* of a corporation can be imputed to a person who owns it, which is not at issue here. It is an entirely separate question, with a very different answer, whether a prohibition on offering presents to an officeholder can be evaded by offering those same presents to a business he owns.
I will let unnamed NPR experts speak for themselves. The notion that the Clause extends to restraining economic policy decisions under which Trump’s “interests will benefit along with everyone else’s” sounds like an eccentric one indeed, so if that NPR expert argued that position, he or she will find little company here.
The more usual hypothetical under discussion is what to do should the government of Corruptistan decide to cut a million-dollar check to the Trump org under circumstances that seem to depart from ordinary business practice (say, it plunks a million-dollar deposit down on some land for sale and then walks away the next day). As all who read my article know, the Emoluments Clause prohibits not just emoluments from foreign state entities but also “presents” from them, no matter how innocently intended on the part of the recipient. The more complex the set of business relations with foreign entities, the more situations will come up in which it will not be clear at a glance whether a high-ball payment is or is not a “present.”
Here is a new article shedding light on how the Department of Justice has construed the obligations of the Emoluments Clause over many decades and under many presidential administrations:
http://www.politico.com/blogs/under-the-radar/2016/11/a-foreign-emoluments-clause-library-232027