Exploring Presidential Conflicts of Interest

Written by Christi Hayes and Fact Checked by The Law Dictionary Staff  

The election of the 45th President of the United States, Donald J. Trump, has brought to the forefront of American politics the concept of conflict of interest in the position of the presidency. As a political outsider with business interests around the world, Donald Trump is unlike any other candidate to win the nation's highest office. As such, it is important to explore the concept of conflict of interest as it applies to the role of President of the United States of America.

Emoluments Clause

Tucked away within the United States Constitution is a little-known clause that deals with the potential for government employees and elected politicians regarding conflict of interest. In Article I, Section 9, Clause 8, you'll find a passage known as the Emolument Clause, which reads as follows:

"No Title of Nobility shall be granted by the United States; and no Person holding any Office of Profit or Trust under them, shall, with the Consent of the Congress, accept any present, Emolument, Office, or Title of any kind whatever, from any King, Prince, or foreign State."

The purpose of the Emolument Clause was to prevent foreign entities, be they foreign governments directly, elected officials of other nations, heads of state, or business owned by foreign governments to curry favor within the United States and its domestic and foreign affairs through bribery.

As it pertains to President-elect Donald J. Trump, the conversation has arisen because of the multibillion dollar empire he controls that is involved in real estate, property management, and his own branded products. With a newly opened hotel in Washington DC, as an example, Trump has already run into conflicts of interest with foreign diplomats admitting to spending money staying at the Trump Hotel at that location in an effort to gain favor with the 45th President's administration.

An Example of the Emoluments Clause

In his first years in office, President Barack H. Obama was awarded the Nobel Peace Prize, and almost immediately sought the advice of the Justice Department on whether or not he could accept the prize. The New York Times lays out the process, which is covered in brief as follows.

President Obama wanted to ensure that accepting the Nobel Peace Prize did not violate the Emoluments Clause of the Constitution. The Justice Department found that the clause does in fact apply to the President, something scholars are split on, but that accepting the prize did not put President Obama in violation of said clause.

Because the Nobel Peace Prize is awarded by a committee operating independently of the Norwegian government, it is not a title or honor bestowed by a foreign state. Additionally, because the award money, which amounts to $1.4 million, is privately financed it is also not a violation of the Emoluments Clause.

In the past 50 years, no President in modern American history has risked running afoul of the Emoluments Clause as it pertains to their personal dealings or holdings. Presidents Jimmy Carter, George H. W. Bush, Bill Clinton, and George W. Bush all placed personal holdings into blind trusts to avoid the appearance of a conflict of interest.

Another important note moving forward. The judgement from the Justice Department regarding President Obama's acceptance of the Nobel Peace Prize noted that "Corporations owned or controlled by a foreign government are presumptively foreign states under the Emoluments Clause." Which brings the conversation back around to President-elect Trump.

Conflicts of Interest and the Presidency

In the case of Donald J. Trump, conflict of interest questions are firing in from all sides because of his massive, global business empire. Trump's companies do business with entities around the globe, and it goes well beyond booking a few hotel rooms in a Trump Hotel in Washington DC.

Mr. Trump's ventures include, but are not limited to, real estate arrangements in Ireland and Uruguay where his company is the full owner or branding partner; the Bank of China as a tenant in Trump Tower and lender to another building his company owns in midtown Manhattan; and real estate deals in place with the government of Saudi Arabia.

A Murky Clause

When it comes to conflicts of interest and the Presidency of the United States of America, the argument often comes down to the interpretation of "emoluments." In their choice of that particular word, the Founding Fathers granted instant ambiguity unto the so-called Emoluments Clause of the Constitution. Merriam-Webster defines emoluments as "the returns arising from office or employment usually in the form of compensation or perquisites."

The choice of emoluments to define improper gifts or payments created a murky situation that has left more than one US President seeking the counsel of Congress on the potential violation of this clause. For example, President Andrew Jackson was offered a gold medal from Latin American revolutionary Simon Bolivar, who later became the president of Columbia. President Jackson believed he could not accept the gift and Congress agreed.

Further, President Martin Van Buren was offered numerous gifts (two Arabian horses, rose oil, rose water, cashmere shawls, and a Persian rug) from the imam of Muscat (modern Oman). Van Buren did not want to offend the imam, but felt he could not accept the gifts under the Emoluments Clause. He consulted Congress and eventually sold the gifts and deposited the proceeds in the US Treasury.

Even President John F. Kennedy turned down the offer of Irish citizenship from the government of Ireland because it was presumed this "title" was going to be in violation of the Emoluments Clause, and further that the clause did in fact apply to the President of the United States.

In the end, the Emoluments Clause leaves the door wide open for interpretation as to whether or not gifts and payments constitute a conflict of interest for a sitting president. Some believe that any kind of payment, gratuity or gift, as well as ordinary payments to a profit-making enterprise, violate the Emoluments Clause.

On the other hand, other scholars believe the conflict of interest set forth in the Emoluments Clause dispute that interpretation and believe fair market payments should not count. This argument is bound to continue, and will likely be viewed more through the lens of ethics. At the end of the day, many will rightly as "is it ethical for the President of the United States to accept payments from foreign actors?"

Donald J. Trump's administration will surely put the Emoluments Clause to the test, and his actions from day one of his administration will frame the application of this clause to the presidency and future conflicts of interest.

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