The quick version:
The Emoluments Clause of the Constitution forbids US Officials from accepting gifts, pay or offices and Titles from foreign governments; essentially, not to enrich themselves at foreign troughs at the expense of the USA, but to maintain total loyalty to US policy and interests.
As President Trump has not released his tax returns or even who in foreign nations has a financial stake in his enterprises or that he might owe money or favors to, we don’t know where all of his conflicts of interest might lie.
You see the problem here: Without knowing who Trump owes money or favors to, we are in murky waters when it comes to his motivations for deals with foreign states.
Below the fold is a longer explanation.
The Longer Story
There has been a lot of talk in the media about the Foreign Emoluments Clause of the Constitution and how it relates to Donald Trump and his family. According to some experts, he has already violated this clause and is at risk of impeachment because of it.
So this brings the question: What the heck is an “emolument” and how does it apply to President Trump and his family? It is simpler than it sounds; read on.
Emoluments = Pay for Services
First: What is an emolument? Dictionary.com defines the word:
- profit,salary, or fees from office or employment; compensation for services:
Tips are an emolument in addition to wages.
Basically, if someone pays you a fee, wages or salary for work or a service, you’ve received an emolument.
Now let’s look at the Constitution:
ARTICLE I, SECTION 9, CLAUSE 8
“No Title of Nobility shall be granted by the United States: And no Person holding any Office of Profit or Trust under them, 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.”
Note the intention here: U.S. government officials are not to take presents, wages, salary, hold an office for or receive a title from foreign states or royalty. In other words:
No Foreign Bribes.
Pretty clear, isn’t it? The Constitution forbids US officials from accepting bribes or placing themselves in a conflict of interest. They must be true to the U.S. and not have split loyalties.
There is one exception: if Congress gives its consent. We’ll come back to that.
How Does This Apply to Trump and his Family?
President Trump, his daughter Ivanka and her husband, Jared Kushner, all hold official positions within the Trump Administration. As such, the Emoluments Clause applies to them.
And there seems to be overwhelming evidence that they violate the clause on a regular basis. Some of Trump’s potential conflicts of interest are known. For example: Trump owes $300 million to Deutsche Bank, the largest bank in Germany, which is currently under US federal investigation for possible money-laundering for wealthy Russian citizens. If he fails to make loan payments and Deutsche Bank does nothing, that could be a conflict of interest. Or if Trump’s Department of Justice goes easy on DB and DB then forgives all or part of that loan…
For another example, take China’s sudden willingness after the election, after 10 years of stalling, to grant Trump 38 exclusive trademarks in China. Or foreign governments lining Trump’s pockets by choosing to stay at his hotels and resorts, while he makes decisions that effects those countries. Or China’s recent granting of some trademarks to Ivanka Trump for her clothing line there, on the day her father met with China’s president on ‘official business’. Those are just a few examples.
Jared Kushner, the President’s 36 year old son-in-law and trusted advisor, is even more problematic than Ivanka. Not only does he head up a real estate and investment empire estimated to be worth over $700 million with investors from Russia, China, Israel and more, he has a huge portfolio of policy responsibilities in the administration – everything from creating peace in the Middle East to restructuring how the government operates. And yet, eight days after the election, he was meeting with a group known to have ties to the Chinese government and that had been barred from some real estate markets in the US over security concerns (yeah, a company with ties to the Chinese leadership trying to buy a hotel near the large US naval base in San Diego would be cause for alarm).
His other potential conflicts of interest make an interesting read. Here is one short list from a Vox.com article from January of this year:
- Goldman Sachs has lent money to the Kushner Companies and invested in Cadre, a real estate technology firm that Kushner cofounded. Kushner was a leading voice urging Trump to appoint Gary Cohn, president of Goldman Sachs, as his chief economic adviser.
- Kushner’s company has taken a loan from Bank Hapoalim, Israel’s largest bank, which the Justice Department is investigating for helping enable tax evasion in the US.
- Foreign investors, including some from Russia and China, have invested in Kushner’s companies, including Cadre and the real estate firm. Foreign investors on some projects were rewarded with visas through the EB-5 program, which gives investors putting at least $500,000 into American companies a two-year visa and path to citizenship. Congress is responsible for renewing the EB-5 program, and the Government Accountability Office, in the executive branch, has raised concerns about it.
- Kushner has an indirect investment in a venture capital firm that has invested in Oscar, a health insurance company that depends on the Affordable Care Act.
- And, of course, Kushner is related to Trump — although he’s hired a Washington law firm that, according to the Times, argues that, even though federal officials can’t hire relatives to work in the agencies they lead, the White House is not a federal agency and so Trump can hire him.
And those are just the one’s we know about. That was four months ago at the time of this writing; as Kushner’s responsibilities grow, so do his potential conflicts.
Taken all in all, this is a situation that we’ve never seen before in the US: a wealthy President and his family who has widespread foreign interests, but refuses to detail them so that the people can know whether he’s just taking care of himself and his family or has the country’s best interest in mind.
How Can This Be Bad for the American Citizen?
So, how does this affect the average Joe or Jane? In a couple ways, actually:
- With the Trump family’s foreign financial interests being so widespread and, in many cases, the details foggy or unknown, we can never be sure that Trump’s negotiations and deals with foreign states aren’t being made mainly for the benefit of the family businesses;
- If deals are being made with the family businesses in mind and the American people second, then you can be sure we will be the one’s paying whatever bill comes due.
What Can Be Done?
This is where Congress comes in… if it wishes.
Remember how Congress can consent to the deals? That implies that Congress would be informed of them, hold an investigation and make sure the Emoluments Clause was not being violated. And in this Congress, it would be easy for Trump to get approval for pretty much any business deal on the side that he wants to make, as long as he took care to hide the most odoriferous or sleazy ones.
But the Republican-controlled Congress has been remarkably quiet on this issue. Of course, they have a vested interest in not causing a scandal, which seems likely to occur if they do bother to look at Trump’s various dealings with Russia, China or any other country. At the very least, they must know it would not play well with the public in the months before the 2018 mid-term elections. The GOP already smells the smoke; they have no interest in finding the fire.
But by not even threatening to investigate Trump’s broad business dealings or questioning them in public, the Republican leadership is making itself complicit in anything shady that comes out later. Perhaps they hope to dodge the bullet by throwing Trump under the bus when and if it comes to a head; that would be par for the course for the Republicans. One can imagine the cynical and hypocritical cries of “We had no idea!” as they push the President under the tires.
Thankfully, outside organizations such as CREW are at least attempting to hold Trump accountable, even if Congress ignores its responsibility. How successful they will be remains to be seen, but at least someone is trying here.