Lessons from the Trump Administration’s Conflicts of Interest

In May 2017, this blog began tracking corruption and conflicts of interest in the Trump Administration, in order to identify and document the myriad ways that the President, his family, and his closest advisors may “use the presidency to advance their personal financial interests.” This includes payments directly from the U.S. government to the Trump Organization (e.g. the Secret Service renting out space in the Trump Tower); use of the presidency to promote Trump brands (e.g. numerous Republican re-election campaigns held in Trump owned businesses); regulatory and policy decisions that benefit the Trump family and close advisors (e.g. the General Services Administration approving a lease for the Trump International Hotel); and private and foreign interests dealing with Trump businesses (e.g. Trump hotel, resort, and other development projects around the world). Keeping track of all these various conflict and corruption risks is important at a time when the news of yesterday gets drowned out and forgotten amid the drama of today.

After working for over a year as one of several contributors to this tracking project, I think that there are also some broader lessons and themes that have emerged from these efforts, which are worth highlighting:

  • First: These conflicts will likely continue to proliferate over the coming months and years. There is little indication that President Trump or those closest to him are taking affirmative steps to reduce the sorts of conflicts of interest we have been tracking. Moreover, the steps already taken (including the President ceding control of the Trump Organization to his sons, and Jared Kushner turning over his real estate empire to family members) are insufficient, as both Trump and Kushner remain beneficiaries of their businesses. The conflicts will likely continue to grow, particularly with the upcoming 2018 and 2020 elections. For example, when the President travels on his personal campaign plane owned by the Trump Organization (instead of Air Force One), the Secret Service directly reimburses a Trump Organization company (in this case, TAG Air, Inc.). The President has also already begun hosting 2020 re-election campaign fundraisers at the Trump Hotel in Washington DC and his 2020 Campaign has spent over $500,000 at Trump-owned properties. Republicans are following suit, with the Republican National Committee, the Republican Governors Association, and individual members spending hundreds of thousands of dollars at Trump properties; expenditures which directly benefit the President.
  • Second: Public scrutiny of these conflicts of interest, and the associated backlash, may have a meaningful effect on the actions of President Trump and his family. For example, on Donald Trump Jr.’s trip to India last February, in addition to pitching new Trump branded luxury high-rises, he was also scheduled to give a policy speech on US-India relations at a conference also attended by Prime Minister Modi. However, after pushback from current and former U.S. government officials, Trump Jr. abandoned his plans for the speech and gave a sit-down interview in which he emphasized, “I’m here as a businessman, I’m not representing anyone.” While his interview still raises ethical concerns, this incident demonstrates the impact of political and public pressure on the President and his family. Similarly, pressure and publicity have led to resignations, disclosures, and changes in action, including the resignation of Dr. Brenda Fitzgerald from her post as Director of the Center for Disease Control and Prevention.
  • Third: Jared Kushner, son-in-law and senior advisor to President Trump, is at the center of many of the conflicts we have been tracking. These include a failed multi-billion-dollar transaction with a Chinese company, a loan from the former prime minister of Qatar, meetings with Russian officials, and financial ties with Japan. These numerous conflicts are a result of Kushner’s prominent role in his father-in-law’s administration (on foreign policy issues in particular), together with his substantial debts and complex business arrangements, and his failure to completely divest himself from his interest in Kushner Companies. As long as these factors remain, the conflicts will likely continue to pile up for Mr. Kushner.
  • Fourth: Of the four categories of potential presidential profiteering that we’ve been tracking, the largest and most troubling is “Private and Foreign Interests Seeking To Influence the Trump Administration Through Dealings with Trump Business.” These include foreign governments and agents of foreign governments booking rooms and events at the Trump International Hotel, development projects in countries such as Turkey and China, and state tax breaks for Trump hotels. While many of these conflicts are not necessarily surprising, given the expansive domestic and international footprint of the Trump Organization, they are nevertheless problematic because they create both the risk and perception of corruption, with foreign governments and private businesses seeking to curry favor with the Trump Administration by favoring Trump Organization businesses. As the Administration continues to develop and act upon its foreign policy platform, this section of the tracker will likely become longer and more consequential. For example, just days after a Chinese state-owned company issued a $500 million loan for the development of a Trump property in Indonesia, and the Chinese government approved seven trademarks requested by Ivanka Trump around the same time, President Trump announced his intention to lift sanctions against Chinese technology company ZTE, which had been deemed a national security threat by the U.S. government. This conflict of interest raised calls for an ethics inquiry, and is a textbook example of the relevance and consequence of staying abreast of President Trump’s conflicts of interest across the world.

Since his inauguration, President Trump, his family, and his closest advisors have continually enmeshed themselves in a vast tangle of potential conflicts of interest, both domestically and abroad. Each individual incident is a matter of concern, but seeing them all together, as part of a broader pattern of behavior—and an attitude toward the appropriate use of public power—helps paint a clearer picture of the Trump presidency, and why it presents such serious and unprecedented risk of actual and perceived corruption.

6 thoughts on “Lessons from the Trump Administration’s Conflicts of Interest

  1. I agree that in such cases public support is crucial, but I often wonder how to help the public see the harm that is being done by conflicts of interests in order to rally that support… For anyone who has worked in the field of anti-corruption for many years, it seems obvious that conflicts of interests mean potential losses for the public sector, that it undermines the integrity of the entire sector and that it might lead to trading of influence. But I often wonder – for someone who is not interested in the field at all, is it obvious? I mean, in many of the examples you mention here (and previous tracker posts), the harm is not so direct as to say that public money is being stolen. Quite contrary, a lot of people might even think that there is no harm done as such (“who cares if the money goes to the business of the family – or some other family”). It is often said that corruption is a victimless crime and that it makes it harder for people to get angry about it – but we seemed to have learned how to present the harm caused over the years and it is, I believe, not that big of a challenge any more. With conflicts of interests, I feel, the picture is even more complex – in the end, many of such cases fall in the grey twilight zone, somewhere between “it is not how you are supposed to do it” and “it is not really punishable” (and then, somewhere in the middle, the inevitable “everybody does this” falls in too).

    I have often pondered what could make the general public (including voters) to better comprehend the harm that conflicts of interests make in politics in any country. I have no immediate solutions, however, but I think we should all look for a narrative that would make it clear that just like corruption harms all people, so do conflicts of interest lead to negative (dramatic? damaging? damaging to whom?) consequences… In some cases, the investigative journalists take up this role by investigating where the conflicts lead and how they are connected to some shady consequences, but I wish we also came up with a way to simplify the conversation to the extent where the harm would be more obvious in the first place. Or maybe it is not possible at all…

  2. Harmann,

    Thanks for your interesting post! As I was reading this, I kept thinking about whether Ivanka’s clothing line was shut because of pressure from the public or if it mostly had to do with conflicts of interest. While you point out that there have been some resignations, which is reassuring, there is something that still feels inherently wrong that someone with such conflicts of interest are able to be appointed or to hold power in some capacity in the first place. I wonder whether you think we should be considering stronger restrictions related to conflicts of interest on the front end, and what those restrictions might look like.

  3. Thank you for this interesting post Harmann. Following up on Ruta’s point, one question I have is why have we not seen such a public backlash to these cases of Trump family and associates using public funds or influence for personal enrichment? Perhaps it has to do with what Ruta described above, namely that corruption can seem like a victimless crime, and its harms can be hard to illustrate to the public. And yet, around the world there is real anger around the misuse of public funds that is fueling populist movements around corruption. I would argue that we have seen this anger in the U.S. context as well. In fact, the “drain the swamp” mantra that Trump used during his election campaign in 2016 may be traced back to public dissatisfaction with the influence of special interests in American politics, and a general sense that the lawmakers in the capital were “corrupt.” All this to say, that I do believe Americans can sense the harms of corruption or “money in politics,” and that may be what put Trump in the White House in the first place. Perhaps, the reason why these concerns have been harder to highlight this time around is because of all of the other issues that have taken the national spotlight (e.g. immigration, women’s rights, racial discrimination). Oftentimes, these issues can feel more pressing because their harms are more concentrated. Thus, the people that are harmed can more easily organize and make their harm known. The harms of Trump using his own airplane, or Jared Kushner mixing foreign policy and business are more spread out and hurt each person affected less. Thus, it is harder to organize everyone affected and demand change.

    While it is certainly harder, it is not impossible. In other countries like Brazil, Colombia, and Peru we have seen the public take on corruption as their top issue, forcing a referendum on corruption measures, and voting for candidates based on their stances on fighting corruption. It does not seem like these conflicts of interest are at the forefront of public discourse around the upcoming federal legislative elections (midterms) in the U.S. The opposition party (Democrats) has not always highlighted these concerns in their own messaging around the upcoming elections. Perhaps they should…

    • I’m in total agreement with your comment, Cristina. I was thinking the same thing as I was reading the post: because there have been so many political issues that have sparked outrage among progressives, it seems that President Trump’s conflicts of interest have not been given enough focus. However, this is inevitable–there is only so much “resistance” available, and other concerns have taken precedent. What is really disappointing to me about this, however, is that POTUS having conflicts of interest should not be a partisan issue! Indeed, both liberals and conservatives–in less politically polarized times–would normally agree that regardless of party affiliation, conflicts of interest are unambiguously bad. Instead, as you mentioned, Trump’s opponents have had to pick their battles, which have ended up being more classically politicized issues (e.g., immigration policy).

      • Thanks for the post, Harmann! Following on Cristina’s and Ross’s comments, I can’t help but think of Prof. Stephenson’s recent post about the potential challenges of anticorruption as an election priority. While it seems that in Brazil, the pulls of far right ideology and corruption go in different directions, requiring voters to choose between them (this is extremely simplified), in the US, those poles are currently more aligned with one 2020 candidate. The question, then, is not whether the general public should vote based on one value over the other when picking between candidates, but instead, whether the opposition party should highlight one issue over the other in its messaging to motivate voters to vote against a single candidate. At the core of both questions, though, are those basic, lingering uncertainties about how much people care about corruption when voting and how much they should.

        • I also agree with Ross that in administrations that bring so many controversial policies to force, opponents must choose their battles. I am also afraid, and maybe here I am biased by the ongoing experience, that an anticorruption agenda being internalized by voters (and in combination with a disbelief in traditional politics) creates an irrational approach on the matter, making voters pick bad candidates just because they believe they are not corrupt. As corruption is a complex problem and as such demands complex solutions, creating a strong popular conscience about anticorruption needs to be balanced with keeping the attention and seriousness over other important matters.

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