What You Need to Know About the ‘Emoluments Clause’

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What’s an Emolument and Should Trump Be Worried?

America’s founding fathers probably didn’t envision Donald Trump. They did, however, think to include a sentence in the U.S. Constitution that could curb the activities of a businessman-president. Trump’s decision to keep his stakes in his global business, the Trump Organization, raised the question of whether he is continually violating what’s known as the "emoluments clause." Critics of the president have filed lawsuits pressing the case. And he’s not the only Trump raising emoluments questions.

1. What does the Constitution say?

The foreign emoluments clause -- in Article I, Section 9 -- reads, "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."

2. What does that mean?

Merriam-Webster defines emoluments as "returns arising from office or employment usually in the form of compensation or perquisites." Historians largely agree that the original intent of the constitutional provision was to discourage early American leaders from being influenced by gifts or titles bestowed by European government or royalty.

3. Why is this an issue for Trump?

Though he stepped away from day-to-day operations of his businesses, Trump declined calls to divest or place his holdings in a blind trust. So he retains ownership in companies that do business with foreign diplomats, state-controlled companies and state-owned television channels. A prime example is the Trump International Hotel Washington, D.C., which is getting business from foreign governments and their representatives. It’s also housed in a building that Trump’s company leases from the U.S. government, which raises another issue: A second constitutional clause -- in Article II, Section 1 -- says the president receives a salary while in office but "shall not receive within that Period any other Emolument from the United States, or any of them."

4. So has Trump accepted an emolument?

That might be for judges to decide. The handful of lawsuits pressing the case cite trademarks granted to Trump’s company by China’s government; rent paid at Trump Tower in New York by the Industrial & Commercial Bank of China Ltd. and the Abu Dhabi Tourism & Culture Authority; and events booked at Trump’s Washington hotel by the embassy of Kuwait and by a lobbying firm working for Saudi Arabia. The foreign emoluments clause makes Congress the arbiter of whether any of this crosses the legal line, but the Republicans who run both houses have given no indication of being interested in taking up the issue.

5. Does Trump acknowledge those were emoluments?

No. His lawyers say fair-market transactions, like when a foreign delegation pays the market rate to stay at a Trump hotel, are permitted. The U.S. Justice Department, defending Trump in court, argued that the strict interpretation being applied by Trump’s critics would mean that "presidents from the very beginning of the Republic, including George Washington, would have received prohibited ‘emoluments.’” Trump pledged early in his presidency to donate to the U.S. Treasury "all profits" from foreign government patronage of his hotels, but that promise proved difficult to carry out.

6. Didn’t Trump put his companies in a trust for this reason?

Yes, but not the kind of trust that most recent presidents have used to avoid conflicts. The one Trump created is overseen by an independent ethics officer and managed by Trump’s sons, Eric and Don Jr., and Chief Financial Officer Allen Weisselberg. It holds profits from the business for him and allows him to draw money. A blind trust, by contrast, would be run by a fully independent trustee, who would have no contact with Trump and would be the sole decision-maker on keeping, selling or reinvesting Trump’s assets.

7. Which other Trump raises emoluments questions?

Ivanka Trump, as an (unpaid) adviser to her father, is officially a federal government employee but has retained ownership of her eponymous company, including the right to approve or veto deals. Her intellectual-property company, Ivanka Trump Marks LLC, has won at least seven new trademarks from China since she joined the White House staff. Over the past decade, she has filed for 173 trademarks in 21 foreign countries, according to the New York Times. And in one important way, she has even less legal cover than her father does.

8. Why is that?

As Trump himself has said, "the president can’t have a conflict of interest." That’s true in this respect: Congress specifically exempted the president and vice president from the federal law that bans members of the executive branch from taking "acts affecting a personal financial interest."

9. Who’s suing, and for what?

Citizens for Responsibility and Ethics in Washington, or CREW, filed a federal lawsuit in Manhattan seeking to stop Trump’s business ventures. It’s working with a Washington-area restaurant association and luxury hotel event booker that say Trump’s businesses pose unfair competition. The attorneys general of Maryland and the District of Columbia also have a lawsuit pending. In another suit, in federal court in Washington, almost 200 Democratic members of Congress are seeking "the opportunity to cast a binding vote" on the issue, since the Constitution requires the president to obtain "the consent of Congress" before accepting an emolument.

10. What does legal precedent tell us?

Not much. It’s exceedingly rare for emoluments to be litigated in court, especially as relates to the president. But the issue does come up occasionally. In 2009, amid political dueling about whether President Barack Obama could keep his Nobel Peace Prize, the Justice Department advised that there was no emoluments violation because the committee that awards the prize isn’t a “King, Prince, or foreign State." In 1963, President John F. Kennedy declined an offer of honorary Irish citizenship on the advice of the Justice Department.

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