Ethical Dilemma

Jan 4, 2017 | 0 comments

“Trump’s Claim That ‘The President Can’t Have a Conflict of Interest’”

According to the article, President-elect Donald Trump will enter office with an astonishing array of business projects, loans and business deals around the globe. Reports have raised questions about those potential conflicts – Trump acknowledged that he recently encouraged British politician Nigel Farage to oppose offshore wind farms that might affect the view from one of his Scottish golf courses — but Trump shrugged off any potential problems.

“The law’s totally on my side, meaning, the president can’t have a conflict of interest,” he said.

Is this the case?

The law doesn’t say the president can’t have a conflict of interest. But Congress, under Title 18 Section 208 of the U.S. code, did exempt the president and vice president from conflict-of-interest laws on the theory that the presidency has so much power that any possible executive action might pose a potential conflict.

“As a general rule, public officials in the executive branch are subject to criminal penalties if they personally and substantially participate in matters in which they (or their immediate families, business partners or associated organizations) hold financial interests,” the Congressional Research Service said in an October report. “However, because of concerns regarding interference with the exercise of constitutional duties, Congress has not applied these restrictions to the President. Consequently, there is no current legal requirement that would compel the President to relinquish financial interests because of a conflict of interest.”

This principle was outlined in a 1974 letter from the Justice Department, issued at a time when Nelson Rockefeller was under consideration to be confirmed as vice president after Richard Nixon resigned and Gerald Ford became president. Rockefeller, then governor of New York, was heir to a fortune and consented to congressional hearings in which his business interests were closely examined.

“The uniqueness of the President’s situation is also illustrated by the fact that disqualification of the President from policy decisions because of personal conflicting interests is inconceivable,” the letter noted. The 1978 Ethics of Government Act and the 1989 Ethics Reform Act later codified this principle.

In other words, Congress assumed that the president could be trusted to do the right thing. Most recent presidents — Lyndon Johnson, Jimmy Carter, Ronald Reagan, George W. Bush, George H.W. Bush, Bill Clinton — have placed their personal assets in a blind trust, even if they did not have a legal obligation to do so. President Obama did not, but his assets were only in mutual funds and Treasury bonds.

Trump is unique because so much of wealth is tied in with the value of his “Trump” brand. Already, foreign diplomats have been flocking to his recently opened hotel in downtown Washington — and Trump noted to the Times that his brand is suddenly “hotter.”

The fear of potential influence from foreign governments through economic benefits to federal officials led to the Foreign Emoluments Clause in the U.S. Constitution. Trump’s business holdings around the world could test the boundaries of the letter or spirit of the clause. Case Western Reserve University law professor Erik Jensen outlined key questions that may arise regarding whether the Emoluments Clause would apply to Trump and his business holdings.

“If nothing else, however, the Clause emphasizes the founders’ fears about economic benefits coming to American officials from foreign governments. It adds a constitutional dimension to some good, old-fashioned appearance-of-impropriety concerns,” Jensen said in response to a question about Trump and the Emoluments Clause posed by Jonathan Adler of the Volokh Conspiracy blog.

For what it’s worth, Trump’s pick for chief of staff, Reince Priebus, has vowed that the White House counsel will review all potential areas that could pose a conflict: “I can assure the American people that there wouldn’t be any wrongdoing or any sort of undue influence over any decision-making.”


Discussion Questions

1. Define “conflict of interest.”

According to, conflict of interest is:

A term used to describe the situation in which a public official or fiduciary who, contrary to the obligation and absolute duty to act for the benefit of the public or a designated individual, exploits the relationship for personal benefit, typically pecuniary (financial).
In certain relationships, individuals or the general public place their trust and confidence in someone to act in their best interests. When an individual has the responsibility to represent another person—whether as administrator, attorney, executor, government official, or trustee—a clash between professional obligations and personal interests arises if the individual tries to perform that duty while at the same time trying to achieve personal gain. The appearance of a conflict of interest is present if there is a potential for the personal interests of an individual to clash with fiduciary duties, such as when a client has his or her attorney commence an action against a company in which the attorney is the majority stockholder.

Incompatibility of professional duties and personal interests has led Congress and many state legislatures to enact statutes defining conduct that constitutes a conflict of interest and specifying the sanctions for violations. A member of a profession who has been involved in a conflict of interest might be subject to disciplinary proceedings before the body that granted permission to practice that profession.

2. In your reasoned opinion, does a conflict of interest represent a violation of ethical standards? Why or why not?

This is an opinion question, so student responses may vary.

3. As the article indicates, according to president-elect Trump, “the president can’t have a conflict of interest.” Do you agree or disagree? Explain your response. Is it difficult or impossible to answer this question without being influenced by your political affiliation and ideology?

As referenced in the article, president-elect Trump’s full statement regarding the issue is “(t)he law’s totally on my side, meaning, the president can’t have a conflict of interest.” As the article further indicates, the law does not say the president cannot have a conflict of interest. However, the United States Congress, under Title 18 Section 208 of the U.S. Code, did exempt the president and vice president from conflict-of-interest laws on the theory that the presidency has so much power that any possible executive action might pose a potential conflict.

In your discussions with students, do remind them that the law and ethics do not always coincide. More particularly, what might not constitute a violation of law can constitute a violation of ethics. Ethical standards often encourage the decision-maker to avoid even the appearance of impropriety.