Trump administration is a scandal in waiting: Column

No administration in history has been as fraught with financial conflicts of interest as the incoming Trump administration, from the president-elect on down. If steps are not taken to manage these conflicts, the Trump administration is likely to become one of the most scandal-ridden in memory.

We have had wealthy presidents before, and millionaire Cabinet officials, but President-elect Donald Trump and his nominees shatter all records when it comes to the amount and scope of wealth and investments, and to potential conflicts as well.

Most presidents have been fairly wealthy, but their wealth was primarily domestic, and each in recent history has managed his conflicts through creating genuine blind trusts. Though no one knows for sure, because Trump refuses to release his tax returns, Trump’s vast empire is probably in the billions and spans the globe, with various investments tracked so far in more than 20 countries.

All these foreign nations have a stake in U.S. foreign policy. Many are in a volatile relationship with the United States. Yet all would like to influence America’s worldview. China, Qatar, Saudi Arabia, Azerbaijan, Philippines, India and Turkey, to name a few, want something from the United States. Now they have a personal financial connection to the incoming president.

Ethics scholars across the political spectrum are calling upon the president-elect to address his conflicts of interest. Dozens of representatives from the ethics community sent Trump a letter asking that he divest himself from financial conflicts, especially from foreign investments, and move his wealth into a genuine blind trust run by an independent executor, not by the Trump family.

But so far he is sending opposite signals — canceling a Thursday news conference about his plan to handle conflicts, and tweeting that he’ll put his sons in charge of his business even though the law does not require him to walk away.

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The federal statute, which requires officials to divest themselves from conflicts of interest, applies to everyone except the president and vice president. When the law was originally written during the Civil War, the president was not exempt. During a 1962 redrafting, Congress rejected pleas from President Kennedy to exempt the president.

It was not until a 1974 memorandum from Acting Attorney General Laurence Silberman, in response to a request from the very wealthy vice presidential nominee Nelson Rockefeller, that the president and vice president were exempted. This was codified in 1989 and was what prompted Trump to declare: “The president can’t have a conflict of interest.”

The Emoluments Clause of the Constitution is not quite so forgiving. The Founding Fathers feared foreign governments currying favor with officials by throwing gifts at their feet. They wrote right into the Constitution that officials cannot “accept of any present, emolument, office or title, of any kind whatever, from any king, prince or foreign state.” The president-elect may choose to ignore the conflict of interest statute with his private holdings, but he is running up against the Constitution when it comes to his enterprises involving foreign governments.

Trump is far from the only incoming official with personal financial conflicts of interest. His Cabinet nominees bring their own weighty conflicts. The George W. Bush administration was criticized as a team of millionaires with a combined net worth of about $250 million. That’s a lot of money, but it is a mere one-tenth of the wealth of Trump’s secretary of Commerce nominee alone. Without question, Trump is assembling the richest administration in history — and this is troubling.

Yes, the conflict of interest statute will require these Cabinet officials to make use of blind trusts. But much more needs to be done. Titans of industry will soon be running our government, in some cases taking over the very agencies that oversee their own businesses. This will make the Trump administration a ready target for charges of self-dealing unless extraordinary precautions are taken. These extraordinary precautions are already in place with President Obama’s ethics Executive Order 13490.

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Issued the day after Obama took the oath of office, it requires all presidential appointees to sign an ethics pledge that they will recuse themselves from taking official actions that directly and substantially impact their former employers or clients of the last two years. It has resulted in an Obama administration relatively free from conflict of interest scandals.

Obama’s executive order on ethics has been so effective at curtailing self-dealing that legislation has been introduced to strengthen and codify it for all future administrations. Congress might not be ready to approve legislation, but all that is needed is for President Trump to preserve a similar version of the executive order and ensure that his administration respects the rule against self-dealing. Requiring that his Cabinet officers recuse themselves from official actions affecting their former employers or clients would go a long way.

Trump has proposed some reasonable revolving-door restrictions on those who leave the Trump administration, such as a five-year ban on lobbying. He must now impose reasonable reverse-revolving-door ethics restrictions on those coming into his administration. And that includes managing his own conflicts of interest through divestiture and a genuine blind trust.

Craig Holman, the government affairs lobbyist for Public Citizen, has worked on President Obama’s executive order on ethics and other revolving-door issues. Follow him on Twitter: @CBHolman.

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