Everything, Anything, Is an Emolument

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Posted in: Constitutional Law

Shortly after the Inauguration, the Citizens for Responsibility & Ethics in Washington (CREW) sued President Trump, claiming he is, as this very moment, violating the Emoluments Clauses of the U.S. Constitution. The media tells us that the lawyers representing CREW are bipartisan and diverse. They do share one unifying characteristic: they have always been part of the “NeverTump” movement. That doesn’t mean that their claim must be wrong, but it does mean that their views are not the product of disinterested objectivity. Let’s examine the claim.

There are two Emoluments Clauses, and CREW’s lawyers argue the president is violating both. First, the Foreign Emoluments Clause, Article I, §9, cl. 8, provides that “no person holding any office of profit or trust under [the United States], 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.” There is a question whether this clause applies to the president. President George Washington openly accepted gifts from French government officials (including an engraved portrait from the French ambassador), without the consent of Congress and there is no historical evidence that anyone complained.

That historical tidbit suggests that George Washington and his contemporaries may have thought that the Foreign Emoluments Clause did not apply to the president. The Department of Justice, in a 1974 Opinion Letter, by Assistant Attorney General Scalia, suggested that this clause does not apply to the president: “when the word ‘officer’ is used in the Constitution, it invariably refers to someone other than the President or Vice President.”(Emphasis in original.) Scalia relied on an 1878 Supreme Court case concluding that “officer of the United States” only refers to appointed officials.

However, no federal court has ever interpreted this clause directly. So, out of abundance of caution, it is safer to assume that this clause applies to the president—even though that would mean that George Washington was the first president to violate it.

Still, the CREW makes jaw-dropping arguments to support its position. For example, as one of its lawyers explains any payments from foreign governments or payments from banks controlled by a foreign government falls under this emoluments clause. So, if any officer of the United States invests in an indexed mutual fund that invests in bonds, and a U.K. bank is one of the entities paying interest on the bond, the officer violates the Foreign Emoluments Clause, according to the logic of CREW’s lawyers.

If a foreign employee of the Canadian Embassy buys a hotdog at a Trump-branded hotel, that is also a constitutional violation according to ¶35 of CREW’s Complaint because, CREW announces, emoluments cover “anything of value,” “monetary or nonmonetary,” even if the exchange is at fair market price. CREW makes this allegation repeatedly, ¶¶5, 21, 23, 79, & 88, but repetition of a statement so broad as to be breathtaking does not make it any easier to accept.

For example, if that were the law, it should apply to President Obama, who wrote several books, both before and during his presidency. According to CREW, if a foreign government official buys one of his books at fair market price—chalk up another violation of the Foreign Emoluments Clause. CREW had made no complaint against President Obama’s receipt of royalties, but CREW thinks it is an impeachable offense if  President Trump receives royalties from reruns of his TV shows on BBC. See the Complaint ¶16. I normally would not cite specific paragraphs, but the Complaint is so broad that you have to understand that I am not making this up.

CREW’s interpretation of “emoluments” is so expansive that it covers any transfer of any monetary or nonmonetary benefits from any foreign state. All are violations. The Nobel Peace Prize is surely something of value. The Storting, the parliament of Norway, elects the five-member Nobel commission that picks the winner. It sure looks like a body representing the legislature of a sovereign foreign state awards the peace prize. Nonetheless, the Office of Legal Counsel wrote an opinion that President Obama could accept it while he was president. President Teddy Roosevelt won the Nobel Peace Prize in 1906, but he did not think it appropriate to accept it then, so he waited to accept the medal or the money until 1910, when he was no longer president.

CREW also claims that President Trump is violating the Presidential Emoluments Clause, which is in Article II § 2, cl. 7. Unlike the other clause, this one specifically applies to the president by name, and only the president. This Presidential Emoluments Clause forbids him from receiving any emolument from any of the states or from the United States (except his salary, which cannot increase or diminish during his term).

CREW makes the same claim, that any money flowing from any state or the federal government (except the president’s salary) is verboten under the Presidential Emoluments Clause. Assume a public library in Illinois buys a book that President Obama wrote while he’s president: yet another impeachable offense under the Presidential Emoluments Clause, according to CREW. That is because CREW has such an unusual interpretation of “emolument” that is divorced from the purpose behind the rule (to prohibit corruption). CREW actually says (Complaint ¶50) that this Presidential Emoluments Clause “is violated as a result of Defendant’s ownership interests in various properties and businesses, both foreign and domestic, for which Defendant receives some form of monetary or nonmonetary payment or benefit from the U.S. government or state governments.” Maybe the president should just sell everything at fire sale prices and invest in safe U.S. Treasuries or state bonds. That won’t work either, because that violates their interpretation of Presidential Emoluments Clause. The interest on the state or federal bonds is a “monetary payment” from the U.S. or state government.

One would think turning to any dictionary, that “emolument” would refer to “earnings, pay, recompense, stipend, honorarium.” Emoluments would include bribes, without the need to prove a quid pro quo. In other words, it forbids outside pay, or gifts. A fair market exchange, selling a hotdog at the fair market price, is not an emolument, so there should be no problem when President Obama receives royalties from his books or President Trump receives royalties for reruns of his television show.

President Trump is old enough to be collecting social security. President Reagan collected a pension from the State of California. A pension is not a gift or a salary, yet it does violate the Presidential Emoluments Clause if CREW’s broad interpretation of “emolument” (“any money”) is correct. However, a pension is not a gift; it is payment for pay services. CREW argues that this pension from a state is a prohibited emolument because the Presidential Emoluments Clause prohibits the president from receiving any money or anything of value from any of the states or from the United States. President Reagan received his state pension, and a Department of Justice Legal Opinion approved of it. One would think that good lawyers, in their argument, would either distinguish that Opinion or reject it. Instead, CREW ignores it.

President Trump’s legal advisers announced that he would give all profits from foreign government payments made to any of his hotels or businesses to the United States Treasury. That’s still a violation, say CREW (Complaint ¶36) lawyers, because the Constitution provides “no remedy to this clause.” Just look at the clause—it says nothing about donating all profits from a business to the U.S. Treasury. It also says nothing about book royalties.

Will the Trump Presidency help his hotel business? If a foreign governmental official stays at a Trump hotel, all the profit goes to the U.S. Treasury. That’s good, not bad. As for everyone else,—some people may stay at a Trump Hotel because it has his name on it. Others may avoid it for the exact reason. If the Trump Presidency brings a better economy that will benefit all of us including the luxury hotel business, but that is not a conflict of interest but a similarity of interests. As President Kennedy said, “A rising tide lifts all boats.”

Posted in: Constitutional Law, Politics

Tags: Legal

  • Joe Paulson

    The one-sided nature of this essay makes concerns of “disinterested objectivity” something for both sides.

    Just one tidbit: those who argue that the President is included here cited multiple cases where the President was considered to be covered, up to and including Barack Obama. The George Washington example really only takes us only so far, especially since you know maybe GW was wrong or that was seen as too trivial or whatever.

    The concern that an advocate is making the broadest argument possible is also not too surprising, and conservative examples (“Never Trumpers” include some, to be fair here) can easily be found. It’s rather normal in litigation not to rein in your claims.

    Anyway, it is hard to believe that if a small gift (like the proverbial snuff box) is covered, that even if net profits (or however that is formulated) is given back, nothing of fiscal or other benefit remains that is covered too. It is not good really if — and the countries not covered by the exclusion order shows this is not merely theoretical — there is a concern that foreign states etc. will act differently (and vice versa) depending on Trump’s business dealings.

  • tamoroso

    So, according to that logic, it would seem that *nothing* is an emolument. Because naturally, giving the president (regardless of who he or she is) money that s/he can then donate to the treasury creates *no* ancillary benefits, such as, say, a tax deduction, or even simply the increased goodwill of the voting public. And so on.

    So while I recognize that the CREW crew may have overreached, your arguments, it seems, constitute a remarkable disinclination to reach at all. Is there nothing, other than overt, in your face bribery, which would trigger the emoluments clause? Examples such as “Chinese creditors refinance Trump properties with advantageous terms” may not have a quid pro quo attached t them, but sociology says they need not in order to have the desired effect. If an identified person or group, foreign or domestic, gives the president anything of value, it’s an emolument. And while I can see giving both Trump and Obama a bye on book sales or individual hotel room sales, if the Trial Lawyers Association rents a block of rooms at a Trump property, I believe that should receive somewhat enhanced levels of scrutiny, compared to, say, if I rent a room at a Trump property. I am unlikely to have business before the president, and the likelihood that any organization I belong to will be connected to me in that way is very small. If the American College of Emergency Physicians does it (a group I do belong to), then I think that may be a different story.