Some experts believe his business empire will violate the Constitution from day one.
Barring a major and unexpected change of course, Donald Trump will run the risk of violating the US Constitution on January 20, 2017 — the very first day he is sworn into the US presidency.
The breach stems from the massive conflicts of interest between his presidency and his business empire. Trump has a huge stake in a real estate holding underwritten with a loan from the Chinese government. He has tens of millions of dollars riding on building projects in Saudi Arabia. Foreign diplomats have already admitted to spending money at his hotels to curry favor with the president.
Trump has said that the president is exempted from the federal conflicts of interest regulations that usually bind elected officials — and he’s right about that.
But that answer misses another big barrier presented by Trump’s clinging to a sprawling business empire: that it will directly violate the Constitution.
The Constitution says that no elected official can take an “emolument” of “any kind whatever” from a king, prince, or foreign state. The restriction, known as “the Emoluments Clause,” is intended to prevent political officials from receiving gifts from foreign governments.
Trump is putting himself on a course to do exactly that. The president-elect rode to office promising to “drain the swamp” and tamp down on corruption in Washington, DC. At least in the eyes of legal scholars, he instead looks poised to begin his presidency by breaking the highest law of the land for private gain.
And unless the Republican Party wants to do something about it, there’s basically nothing standing in his way.
Why scholars think Donald Trump is on course to break the Constitution’s Emoluments Clause
Now, a word of caution: There is not unanimity among scholars on the question of whether Donald Trump would be violating the Constitution by allowing foreign governments (and companies backed by foreign governments) from doing business with his private company.
But there does seem to be a fairly broad consensus forming. The issue comes down to the meaning of the “emolument” clause of the Constitution in Article I, Section 9. An “emolument” refers to compensation for a service or labor, according to the New York Times, which raises the question of whether foreign payments to Trump-owned businesses constitute forbidden emoluments.
On its own, scholars say, simply having his businesses continue to interact abroad may not necessarily mean Trump is running afoul of the Constitution. One issue is that no American president has ever had anything close to resembling Trump’s international business ties. Nor is there any real case law or precedent for knowing how the courts would interpret the clause, since previous presidents have voluntarily chosen to either invest their assets in a blind trust or else in diversified index funds so the issue wouldn’t arise.
“Trump’s just dropped out of the sky here, and we don’t know what happens when someone does that,” says Bob Biersack, a senior fellow at the Center for Responsive Politics.
But Richard Painter, a constitutional lawyer and George W. Bush’s former ethics lawyer, told ThinkProgress that the instant Trump’s business sells anything above “fair market value” to a foreign government that it’s clearly then considered a gift — and therefore a violation of the emoluments clause. (This was the same answer given to the Times by Norman Eisen, who was the chief White House ethics lawyer for Obama from 2009 to 2013. It’s also one three separate experts agreed with in interviews with me on Tuesday.)
There’s almost no way to imagine that this won’t happen under the current arrangement. Trump’s wide-ranging business will involve thousands of interactions across multiple countries, and in countries whose foreign governments’ will have clear incentives to curry favor with the president. We’d have to believe that not a single one of them will ever do something that disproportionately helps Trump’s private business — an idea which doesn’t pass the laugh test.
“It’s clearly prohibited,” says Steven Schooner, a George Washington University law professor.
“The president cannot get a gift from a foreign government,” says Jordan Libowitz, of the watchdog group Citizens for Responsibility and Ethics in Washington. “And it looks like he’s going to do exactly that.”
Painter also told ThinkProgress that the president-elect’s name may alone jack up the “fair market value” of a property. Therefore, Trump products may already be considered a violation of the emoluments clause even if there’s no direct proof that the foreign governments paid more than some abstract “fair market rate:”
Painter said, “I don’t think you can take into account the value of the name Trump in calculating fair market value.” The diplomats are not staying in one of Trump’s expensive luxury hotels because Trump is charging their nations a reasonable market rate for a night’s stay. They are staying in the hotel because of the added value that comes from doing business with the President of the United States.
One dissenter from this consensus has been Seth Barrett Tillman, a lecturer at the Maynooth University Department of Law in Ireland. Tillman has argued that Trump isn’t on the hook here because the Constitution doesn’t specify that the president is subject to the Emoluments Clause — an argument that both Fordham Law Professor Zephyr Teachout and Harvard’s Laurence Tribe have dismissed.
Others have argued that the constitutional Emoluments Clause is clearly intended to be about gifts, and that merely having foreign investments does not appear to have been something the founders were particularly concerned with.
“This constitutional provision prevents the president (and any other federal officer) from accepting gifts or compensation from foreign states,” David B. Rivkin Jr. and Lee A. Casey, two former George H.W. Bush administration officials, wrote today in the Washington Post. “It does not limit Trump’s ability to benefit from dealings with non-state foreign entities.”
Trump has an easy way out if he wants it — but he doesn’t seem to
There is a solution to this mess, one Trump could easily find by looking at the actions of his predecessors.
In 2008, Barack Obama decided to liquidate his assets and convert them into treasury bonds and index funds. Ronald Reagan, George H.W. Bush, Bill Clinton, and George W. Bush all placed their assets in a blind trust. Even Jimmy Carter insisted on turning his Georgia peanut farm over to a trustee.
Instead, Trump’s campaign has said that he’s going to turn his company over to a “blind trust” managed by his kids.
The problem is that this setup isn’t even in the same universe as a blind trust. The Trump children will certainly be in touch with him, if not serving informally or even formally in his administration. But even if we grant him that having his kids run the enterprise is a meaningful act of separation, there’ll be nothing “blind” about it — Trump’s name is emblazoned all over his buildings and hotels, and so it will be visible to everyone whether a foreign government can help his private business.
“He’ll be able to know exactly which countries are helping his company,” says John Wonderlich, interim director of the Sunlight Foundation.
Trump’s answer to this point has been that he is personally indifferent to what happens to it. Here he is responding after the New York Times simply asked why he is refusing to sell the company:
I don’t care about my company … I just want to say that I am given the right to do something so important in terms of so many of the issues we discussed, in terms of health care, in terms of so many different things. I don’t care about my company. It doesn’t matter. My kids run it. ... I’m not going to have anything to do with the hotel, and they may very well. I mean it could be that occupancy at that hotel will be because, psychologically, occupancy at that hotel will be probably a more valuable asset now than it was before, O.K.?…
It doesn’t matter. The only thing that matters to me is running our country.
This response boils down to: Trust me. Foreign governments may try to stay at my hotel to curry favor, but they won’t be successful at doing so.
And some voters may trust him. But the Emoluments Clause, naturally, does not carve out an exemption for elected leaders with good intentions.
There is probably no judiciary remedy
So what happens once Trump steps into office and does run afoul of the Constitution?
There will be a lawsuit or a few dozen filed on behalf of liberal groups trying to stop Trump. But it’s hard to imagine that any court ruling would force Trump to do anything like step down from the presidency or even sell off his business. It’s not clear who would have standing to sue, and the Supreme Court has a tradition of declaring certain matters to be “political” and not subject to litigation.
If Congress wants to enforce the Emoluments Clause against Trump, they could pass some specific legislation enabling judicial enforcement of its terms, or it could be used as grounds for impeachment. But as New York magazine’s Eric Levitz notes, “it’s highly unlikely that Paul Ryan is going to lead an impeachment effort against a president who is more popular with Republicans than he is.”
Of course, things could change after the 2018 midterms. But until then, “it’s very likely that President Trump will comply with all applicable rules and regulations — and shape domestic and foreign policy around his own business interests in the process.”