Like many people, both here in the US and across the world, I was shocked and dismayed by the outcome of the US Presidential election. To be honest, I’m still in such a state of numb disbelief, I’m not sure I’m in a position to think or write clearly. And I’m not even sure there’s much point to blogging about corruption. As I said in my post this past Tuesday (which now feels like a million years ago), the consequences of a Trump presidency are potentially so dire for such a broad range of issues–from health care to climate change to national security to immigration to the preservation of the fundamental ideals of the United States as an open and tolerant constitutional democracy–that even thinking about the implications of a Trump presidency for something as narrow and specific as anticorruption policy seems almost comically trivial. But blogging about corruption is one of the things I do, and to hold myself together and try to keep sane, I’m going to take a stab at writing a bit about the possible impact that President Trump will have on US anticorruption policy, at home and abroad. I think the impact is likely to be considerable, and uniformly bad:
- First, the Foreign Corrupt Practices Act (FCPA) is likely to be substantially weakened, perhaps even repealed (though I think the latter possibility is still relatively unlikely). The FCPA “reform” crowd–the Chamber of Commerce, the defense bar, and their various supporters–will now have a Congress that is likely to support “reforms” that substantially weaken the statute, and a President who is already on record as calling the FCPA a “horrible law.” It may not be a top priority of the Republican Congress and the Trump Administration, but I expect that the Chamber and others will seize this legislative opportunity to push through many of the reforms that have been on their wish list for quite some time.
- Second, even putting aside possible changes to the FCPA itself, I fully expect that the era of vigorous FCPA enforcement, which ran from about 2000 (give or take a couple years) up to the present, is over. It’s hard for me to imagine that the Attorney General of a Trump Administration (Rudy Giuliani, perhaps?) would make prosecuting foreign bribery a significant priority, or would devote substantial resources to this area. It might take a little while for the change to become apparent–there are still some cases in the pipeline, after all–but I’d be shocked if the US maintained anything like its current level of FCPA enforcement.
- Now, one might point out that substantially weakening the FCPA and/or ratcheting back enforcement might be in tension with US obligations under the OECD antibribery convention. And so it would. But does anyone really think that a Trump Administration would care about this? After all, the only enforcement mechanism that OECD Convention has is public shaming (through bad peer review compliance reports), and I doubt that a Trump Administration would have much shame.
- Insofar as the US continues to enforce the FCPA, I expect that enforcement will become much more politicized than it has been in the past, with more deliberate targeting of foreign companies (especially those that compete with firms close to Trump and his business associates) and more targeting of perceived political enemies. The complaint that FCPA enforcement is politicized, which I never took seriously before, is about to become much more plausible.
- The DOJ’s Kleptocracy Initiative, which had been making so much exciting progress in its relatively short lifespan, is also likely to be on the chopping block. It seems to me highly unlikely that going after foreign kleptocrats–or indeed highlighting kleptocracy as a problem–is something that a Trump Administration will have much interest in. This is especially the case for kleptocrats with whom Trump, his family, his businesses, or his close associates do business. We don’t know for sure who these might be, but let’s just say I’m skeptical that the Kleptocracy Initiative, even if it survives, will spend much time looking into unlawfully obtained assets from associates of former Ukrainian President Viktor Yanukovych (a Putin ally) or Putin and his cronies.
- Domestically, I think that there is a very serious risk that enforcement of US anticorruption laws will become much more heavily politicized. Keep in mind that President George W. Bush apparently fired several US attorneys for either pursuing corruption cases against Republicans, or not pursuing corruption cases against Democrats. And there’s more systematic evidence of some partisan bias in domestic anticorruption prosecutions more generally. But I expect this problem to increase by an order of magnitude under a President Trump, who has already indicated his desire to use the powers of the presidency to go after his political opponents. And I’m not even talking about anything so brazen as Trump’s pledge to appoint a special prosecutor to go after Hillary Clinton–I have in mind more systematic targeting of Democratic politicians and officials, as well as a systematic shielding of Trump allies.
- I also expect that domestic anticorruption laws will be weakened overall, as Trump’s power to fill several Supreme Court vacancies will accelerate the trend, which we have already seen in the current court, of reading anticorruption statutes narrowly. (A silver lining, if you can call it that, is that the more this happens, the harder it may be for Trump to use those laws to target his political opponents, though that’s not much comfort.)
- Oh, and the recent big push by civil society advocacy groups and others to push for more corporate transparency, for example beneficial ownership transparency and stronger know-your-customer rules? Dead. If anything, I would expect a Trump Administration to be actively hostile to efforts to establish such measures elsewhere.
- Trump’s threat to strengthen defamation laws to allow him (or others) to sue media outlets for unfavorable coverage is, I hope, less likely to become a reality, as I hope that even the more conservative Justices of the existing Supreme Court would hold the line on that issue, no matter who else Trump appoints. But a chilling effect on the media is nonetheless a serious concern, as we have seen time and time again that a vigorous press is vital to exposing public corruption.
- More generally, I expect that Trump himself will likely be, if not a kleptocrat in the most brazen sense, then at least a quasi-kleptocrat–not directly stealing from the US Treasury, but shaping US policies in ways that are designed to enrich Trump and his associates.
- Turning back to the international realm, it probably goes without saying that grander plans to create a stronger international anticorruption architecture will go nowhere under a Trump presidency. Some of these proposals–like the International Anti-Corruption Court–are not ideas that I particularly liked in the first place. But I take no pleasure in the fact that under a Trump Administration, the US is unlikely even to engage in a serious way with meaningful proposals to help fight grand corruption around the world. Anticorruption advocacy groups are going to have to re-think their overall strategies in a world where the United States not only has abdicated its traditional leadership role, but is likely to be actively obstructionist.
So, is there anything to do about this? How can or should the anticorruption community respond? I have no idea. Right now I’m just too depressed to have anything positive or constructive to say. Hopefully that will be for another post in the not-too-distant future. But for now, I thought that maybe getting all these depressing thoughts down in writing would be somehow therapeutic. Honestly, I’m not sure if it was. Now I think I’m more depressed than ever. Sorry.