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Why Donald Trump Should Put His Assets in a Blind Trust
Since his election two weeks ago a couple of stories have come to light of what we might call errors of judgment on Trump’s part regarding the relationship between his business assets and his new duties as President. First, there was the presence of his daughter Ivanka at a meeting with Japanese Prime Minister Shinzo Abe. Ivanka, you will recall, is being placed in charge of Trump’s businesses alongside her brothers Eric and Donald Jr. In that capacity her presence at this meeting was highly inappropriate. There are also reports that Mr. Trump used a congratulatory call with the President of Argentina to push for building permits for an office complex his company is currently constructing. Mr. Trump and Mr. Macri are apparently old friends and colleagues so I’m giving him the benefit of the doubt here, yet the optics aren’t that great. This is especially troublesome because of three words: The Clinton Foundation.
Conservatives and Republicans rightly excoriated the Clintons for the corrupt relationship that the State Department enjoyed with The Clinton Foundation during Mrs. Clinton’s tenure at Foggy Bottom. Donald Trump himself, rightly, made a big deal of this during the campaign. He needs to remove himself from the appearance of corruption so that his administration isn’t hamstrung by constant accusations of corruption from a hostile media.
Furthermore, as the Cato Institute points out, these small lapses in judgment by Mr. Trump become much more legally serious once he becomes President Trump:
In the text, the Emoluments Clause prohibits any Person holding “any Office of Profit or Trust” under the Constitution from accepting “any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince, or foreign State.” Immediately, it is clear that the text limits the clause to gifts from foreign governments and the officials.
The original public meaning of the clause also confirms this interpretation. Foreign kings and princes once gave lavish presents to American officials, for example, a diamond-studded snuff box given to Benjamin Franklin (then ambassador to France) by Louis XVI. The Framers were concerned that these gifts would corrupt our officials, and so they prohibited them.
The next relevant consideration is whether, if Trump’s businesses receive a “gift” from a foreign government, Trump himself may be violating the Emoluments Clause. There is certainly an argument for this, since he benefits from the gift, even if only by increasing the value of his brand and stock holdings.
Finally, what sort of things would be a “gift” from a foreign state? According to one report, Trump has already asked Mauricio Macri, the Argentine president, whether he would help with permitting issues that are holding up the construction of a major office building in Buenos Aires.
If such a deal was made, would the permit be a “gift” from a foreign state? Very likely. Valuable gifts from members of foreign governments need not come in the form of diamond-studded snuff boxes, they can certainly be building permits worth several millions of dollars.
Given how much Trump values his business empire and reputation the temptation to utilize his public position, even innocently, to affect this private empire will be immense. He should remove that temptation.
Furthermore, Mr. Trump has shown that he values the counsel of those close to him and above all that of his children. He should not deprive himself of the advice of a gifted woman like Ivanka or close confidants like Eric and Donald Jr. Their positions at the head of the Trump Empire would require that they be excluded from his Presidential inner circle. Mr. Trump deserves the counselors he wants to help him achieve the goals he has laid out.
Mr. Trump should put his assets in a blind trust for the duration of his administration. For the good of his businesses, for the good of the country and for the good of himself.
Published in General
Agree entirely. If not, his presidency will devolve into a constant scandal machine.
How is it possible to put a hotel or golf course that Trump owns into a blind trust? It is not as if he will suddenly become unaware that he owns that property. Trump owns at least 111 companies operating in 18 different countries, are you proposing that he immediately liquidate all his assets?
Not at all. Put the management of those assets into the hands of people he had no contact with or authority over.
If you had a problem with The Clinton Foundation, then you should have an equal problem with this.
Jamie,
I am less worried about Trump using the Presidency to personally profit than I was with the Clintons. The Clintons had a track record.
However I do agree that if Trump wants to forestall a bunch of semi-scandals he should make the blind trust as blind as possible. Is having his children run the trust sufficient? You seem to think no.
Are these reports sourced well or are they speculation? It feels like we are reliving Halliburton under every bed syndrome.
From what I saw not well sourced. Nonetheless the larger point is correct. The assets need to go into a blind trust.
Agree. Perhaps Rosie O’Donnell would be a good selection?
(I’d add a smiley face at the end but the gigantic version that appears in any quoted passage is terrifying)
The media and Jamie want it — so my advice to Trump is to NOT do it.
The original report I read was in the NY Times. It seemed well-sourced. Regardless, wouldn’t it be smart to put his businesses into a blind trust not only to forestall future stories along these lines, but also for the other reasons I listed.
Here are some other stories that are being used against him:
https://www.washingtonpost.com/business/capitalbusiness/2016/11/18/9da9c572-ad18-11e6-977a-1030f822fc35_story.html
http://economictimes.indiatimes.com/news/politics-and-nation/donald-trump-meets-indian-partners-hails-pm-modis-work/articleshow/55465060.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
Really Larry?
Note:
Personal attack.Good rule of thumb, Jamie. Saves a lot of time.Note:
Personal attack.So you’ve just decided to be a jerk instead of addressing arguments?I think this is pretty non-controversial and assume the Trump folks have been working on this.
I agree and hope they are.
It’s not just the evil Media, Larry. Don’t you care about honest government? Don’t you care about conflicts of interest? These were things that we’ve been pounding Hillary Clinton on for years, doesn’t that matter to you?
What I got from the OP was that the children can run the businesses or serve as advisers, but they should not do both.
Although I agree that a relatively disinterested party should take over (Mitt?), I disagree with your assertion that we have already reached Clintonesque levels. With Clinton, we saw clear graft and nobody holding her accountable. I’d say Trump has a one-strike count and is more than my two remaining strikes strikes shy of what the Clinton’s were given.
One doesn’t need to reach Clintonesque levels to want to maintain honest government and appropriate relationships between the President and his private interests.
Right, but I think the point is he should take care of it before it reaches that point.
We’ll see if he does. Anything less than a blind trust will be problematic.
The guy already has a problem with self dealing, so he needs to be watched like a hawk.
I hasten to add that this is why it’s important to release tax returns, so the public is aware of potential conflicts of interest and keep an eye out.
Tough call for me. I have a desire to see more accomplished CEOs run the one of the largest operations in the world rather than lawyers and those folks tend to have assets.
On the other hand we need a method of separation from conflict of interest.
I propose a third way. Appoint a Special Master who has access to every decision in the private organization and is sworn to be independent. They act as a shadow CEO to protect from conflict of interest. Have them report to a House sub committee on actions taken to prevent issues and potential conflicts.
Let us say we have a President who has a company run by his family who is bidding on a defense contract. Are they excluded or are they allowed to bid ? I would suggest they be allowed to bid but subject to scrutiny on the process by the Special Master. Suppose they make a unique component that is needed for combat readiness?
Let the private sector function and do not destroy the asset by saddling it with incompetent management.
Blind Trusts are for passive assets. They can be a killer for active assets.
I agree that it’s problematic for a CEO like Trump to adhere to the kinds of ethics rules we expect from our Presidents, but this would not apply to all CEOs many of which do not have the same kinds of assets as Trump. This may be a particular quirk of the way Trump’s business assets are structured, their reliance on his personal brand, and deep integration of his family in upper levels of management.
This may be a problem that can’t be circumvented – but Trump’s team should do as much as possible to minimize the contact and influence. I think it’s more important to maintain honest government than to accommodate Trump – if that negatively affects his businesses then he should have thought about that before running.
Changing the analogy to basketball, I’d say the Clintons fouled out five minutes into the game and Trump’s in foul trouble with 2 PF’s through the first quarter, He needs to be subbed for in this before he assumes the office.
I second this. If to comply with ethics standards it costs him money and hurts his businesses, I don’t freakin’ care. He wanted this job.
And if he doesn’t like it, it’s not too late for him to step aside.
I am not saying this is not a potential problem, it just seems it is not as easy to resolve as you appear to believe.
Trump need have no contact with or authority over the management in order to be accused of a conflict of interest. Any general policy or federal agency which affects property management or just the business environment in any location where he has a business is sufficient for the accusation.
Well that was then this is now. It is time to move on. The problem was Hillary was evil, and Trump isn’t evil. How can he be he won the election. Which proves he is beyond reproach. Did you not see the size of his crowds?
Really, though Trump never seems to anticipate his scandals to cut them off at the pass. We will keep this game up until it finally blows up (if it ever does). I expect if Democrats rebound in 2018 they will probably investigate him along these lines in congress and then we will know. Maybe some enterprising journalists will also do some leg work on this. Then Trumps media hacks will all form up to argue it’s not a big deal. Ann Coulter will found a MoveOn.org movement, and I bet he does fine in 2020 despite the scandals that will come up. Though maybe if the Dems have the Congress by then and they catch him in a lie they will impeach him, but the Senate won’t convict, based on a party line vote.
All the more reason to sell all the assets and take his name off existing properties.
I wonder how or if it can be done. He owns and operates real assets part of the value of which is his name, not some arms length portfolio that he can wash his hands of. Must he sell all the real estate and put the proceeds in some blind trust? Even if his kids go off and do something else, any salary they get above what kids their age normally earn will be seen as corruption. There is no way for the Trumps to come out of this without rabid criticism. Comparing how to create distance between real assets that he created and which carry his name and creating a foundation through and because of political power, built on political power and funded by favors and promise of favors is a wild stretch. I have no idea how a President Trump can solve this but to even suggest a parallel with the Clinton foundation is unbalanced.
Here is the question I have though. Is the problem with Trump just his foreign holdings? If you own a building and collect rent from it that seems easy to disentangle. The only issue would be legislation or regulations being altered so as to benefit those properties specifically. But such moves are very transparent and voters can punish Trump appropriately for it. His foreign holdings though might be harder to see and offer foreign government leverage over him potentially, no? I think he should sell all foreign properties now, and end the selling of the Trump name to various enterprises. His US properties can just keep providing him rent as they have.
There is. He can do everything in an open and above board way. He can follow the strictest of ethics guidelines, divest himself as fully as the ethics experts suggest, and do things in a way that is above suspicion.
I strongly suspect that he will not do anything of the sort. He’s spent the last 18 months entangling his business interest and his campaign, and before that, entangling his charitable foundation and his business interests. We’d have some idea if he was open enough to release his tax returns before the election, but refused to do so.