Professor Robert Gordon on President-Elect Trump’s Business Holdings, Ethics, and the Law

As an international businessman with holdings and interests across the country and globe, president-elect Donald Trump begins his transition to the White House with business conflicts of interest and ethical questions unresolved. In the Q&A that follows, legal historian and ethics expert Robert W. Gordon discusses the ethical obligations of U.S. presidents and potential challenges facing Trump.

Robert W. Gordon
Professor Robert W. Gordon

What ethical obligations does the US president undertake once taking office, particularly regarding conflicts of interest and personal benefit/enrichment? Can you give us an overview?

I’m not aware of any specific statute or rule that governs a president’s conflicts of interest—except of course for the “emoluments” clause of the Federal Constitution (of which more in a moment). So Trump is probably technically right to say that he is not specifically required to avoid any conflicts.  But it would defy common sense to suggest that the government’s highest officer ought to be treated as exempt from the rules that govern all the other officers of the federal government—since his power is so much greater, so are his opportunities for corruption and self-dealing. If he engages in serious corruption, of course, he may be impeached (“bribery” is mentioned as  ground for impeachment), but that’s an extreme remedy, and not one that a Congress controlled by the President’s own party is likely to invoke.

The “emoluments” clause says: 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 purpose of this is to limit the ability for foreign governments to buy favors by offering presents or fancy titles like knighthoods or peerages.   By its terms it refers only to governments, not to private actors; and Congress can always consent to receipt of a gift, although it’s doubtful that Congress could legislate a blanket exemption for a President’s benefit

The Trump organization has business holdings throughout the U.S. and the world. While most past presidents have sold off their business interests, Trump’s are more far reaching and complicated. The Office of Government Ethics (OGE) has recommended that Trump divest his business holdings.  Would that be enough?

If Trump divests, but leaves his family running the business, that doesn’t solve the basic problem. Governments and private interests who want favorable treatment from the US government (or to avoid unfavorable treatment) could send business to Trump’s children expecting to buy his favor.

Trump suggested via Twitter that he might “leave his great business in total,” though we don’t have details of what that will look like. If his children still run the company, might that solve any ethical issues?

Giving the business to the children doesn’t solve any of the problems. They are still Trump family enterprises, even if he doesn’t return to them after leaving office. A favor or injury to them is the same as a favor or injury to Trump himself.  And Trump is notoriously vindictive—suppose a deal turns out badly—what’s to prevent Trump from taking revenge through some adverse government treatment—denying the offender a federal contract, or declining to hire their relatives, or auditing their tax returns, or having them investigated for fraud? Nixon made an enemies list and found ways of punishing the opposition; there’s no reason to think Trump would not do the same.  He has already made it clear that he does not intend to abide by any longstanding customs or norms governing the Presidency—as with his refusal to disclose his tax returns during the election.

In addition to business issues leaving Trump vulnerable to charges of ethical lapses, there may be other issues. He was accused of inciting sexism and racism during the campaign and of bending the truth. If that kind of behavior continues into his presidency, is there a written code of conduct that he might breach?

Legally, Trump is protected by the same First Amendment as any other citizen, which gives him a wide license to incite others to deplorable conduct and to tell lies, so long as he does not defame any specific people with actual malice. (As a private citizen, he resorts to no-holds-barred litigation tactics to repel any attempts to hold him legally accountable, and doubtless would continue to do that as President.) He is of course subject to civil suit, and to criminal prosecution, for any acts that violate ordinary laws applying to ordinary persons; though he enjoys a broad immunity for official acts.

What avenues are available to hold a president accountable—legal, political, etc.?

Again, the only effective remedy against a president who routinely violates norms of truth-telling and decent treatment of others is monitoring by public opinion informed by a vigilant press, Congressional oversight, and ultimately the threat of impeachment. Trump’s supporters don’t seem to be bothered by his lies, which they see as a sign of refreshing authenticity, or as pardonable hyperbole in the service of higher truths, or just as opinions entitled to the same deference as any other opinions.  Will they show the same indulgence to Trump’s doing political favors to those who patronize his businesses, and using the tools of government to take revenge on his business enemies? I think we’re probably going to find out.  My deepest fear is that the federal government will become like Brazil’s, riddled with corrupt deals favoring cronies and family connections.

 

7 Responses to Professor Robert Gordon on President-Elect Trump’s Business Holdings, Ethics, and the Law
  1. Professor Gordon,

    Did/Do you have the same problem with the Clintons’ obvious (long term) conflicts of interest and personal enrichment through “public” service, or is this just a hit piece on the President-Elect?

    If you did/do, could you please refer me to the article(s) you have written?

    Thanks!

  2. All good points except two main ideas that are missing or misrepresented. First, we must remember that corruption has at least two main expressions: the corrupt and the corruptors. Not only is the President vulnerable to ethical issues because he may receive bribes but also because he might act as a corruptor by his power and influence. This can damage institutions that are the foundation of American democracy. Secondly, the comparison with Brazil is unfortunate because it makes it seem that corruption is worse in that country. Corruption is a huge problem in Brazil but it is naive to think that the it is the worse possible scenario in the world. Unfortunately, the U.S. challenges could take us to a worse situation, much worse…

  3. Trump is very adamant. I have no doubt that he will abuse the law to benefit himself and his family long after he leaves the office. He is just an empty barrel that is full of lies. No integrity, no honesty. I still do not understand why he can be above the law by refusing to release his tax returns. There must be something that he wants to hide and after he takes the office, it’s too late for us, for the country to undo him.

    Your deep fear is very valid. It’s time for electors to do their job on 12/19/16 to deny him presidency, for the sake of the USA and the world.

  4. Doesn’t the author think that the constitution has some built in “checks and balances” to guard against corruption?

  5. Law, even in the form of a ratified Constitution, is at best an ideal. Ours here in the USA when written, was intended to unify us under the Federalism concept. It was a precedent of the times and in world history.
    Why we are having this discussion relative to Trump’s anticipated Presidency is that the belief in what the Constitution can actually do to protect us is yet to be determined; and that my fellow citizens is the test.
    Can the constitution, within its ideological moral and philosophical underpinnings survive what is sure to be a rigorous testing of it’s limitations? Or, will the result of its testing prove we have fallen from the Grace of our Constitutional protections.
    Not withstanding a congressional unwillingness to address corruption (Circa Andrew Jackson since) we the people might be better off seeking legal consul to draft litigation in a class action civil suit seeking damages – whether intentional or inherent – for the mismanagement of public office to the tune of the amount the corruption cost the tax payers; specifically requesting restitution in addition to applicable fines.
    But I digress. We are at a point of speculation as to an indeterminable, yet admittedly somewhat predictable, outcome of President Elect Trumps administration. If the predictable is likely, let us consider equally unorthodox approaches to the salvaging the vestiges of our two hundred plus year old Constitution .

  6. Trump presents new ethical issues far beyond the good old days of patronage and graft, and divestiture is just the beginning. He has shown that he is a rule breaker. Some of that is good, such as when it comes to norms, not laws, that obstruct effective government. Some of it will be quite bad, when more specific situations we foresee now become reality. Speaking truth to power, prophetic witnessing, and a good public interest lawsuit or two will be needed. Hope the Trump opposition organizes well. As for are we Brazil, we could be very well be on the way. I’m of Nicaraguan heritage, and I see the Trump’s as the Somozas, which is not a good indicator for the future. As for any shenanigans by the Clinton’s, they got rich writing books and making speeches. Illegal? No. Improper? Perhaps. Even if illegal, it does not excuse Trump. I thought we gave up on the “well he did it too” defense long ago.

  7. The Ethics in Government Act of 1978 requires high-level federal officials to publicly disclose their personal financial interests. The public filing system serves to prevent financial conflicts of interest by providing for a systematic review of the finances of government officials. Those finances are set forth in annual disclosures which are reviewed and certified by ethics officials. Neither the President nor the Vice President have any conflicts of interest, and their reports have been reviewed and certified by the independent Office of Government Ethics.

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