To Earn Trust, Trump Needs a True Blind Trust
As the Trump team continues the process of putting together a functioning government, new concerns seem to emerge daily about what could become an unprecedented ethical nightmare in the White House. President-elect Trump needs to move quickly and take concrete steps if he wants turn around this perception and maintain the moral authority to “drain the swamp” – a promise that likely got him elected.
Millions of Americans who have been struggling financially blame their plight on a Washington elite that is fundamentally corrupt and self-serving. For many of these voters, Donald Trump is perceived is someone who can both clean up Washington, D.C., and, in the process, improve their lives. For them he represents hope – a hope that many Americans haven’t had for decades. Failing to reform Washington will be another in a long line of disappointments for these Americans.
Announcing that he will forgo the $400,000 presidential salary was a nice symbolic start. But saying he plans to cede control of the Trump Organization to his children is an empty gesture that will undermine the new president, and everything he professes to stand for. Donald Trump must sell the Trump Organization and all his other assets and put them in a genuine blind trust.
The president-elect obviously understands that the perception he would personally profit from holding office is real. As a result, he has promised to put his assets in a blind trust run by his children. The reality is having his children run an organization that consists of all the same assets he previously owned (and the new ones that will be acquired with his ascendant global brand) isn’t a blind anything.
Given his familiarity with his global empire, Trump will immediately grasp the implications of any legislation, trade deal, or statecraft on his net worth. As someone who has demonstrated a lifetime of measuring himself solely by that number, it would be impossible for Trump to separate his personal interests from the decisions he makes while governing.
The magnitude of the potential for self-dealing here can’t be overstated. Will a President Trump really be able to streamline the tax code, when doing so might require him to eliminate some of the tax breaks that he bragged about taking advantage of during the election? Will a President Trump really be able to conduct foreign policy that’s in the best interests of the United States, when the party on the other side of the table might be able to grant his family favorable treatment on a development deal? And, most importantly, will a President Trump be able to drain the swamp when he’s wading hip-deep in it?
As an example, Trump called for a five-year ban on lobbying for members of Congress. In doing so, he’s trying to prevent the tendency of politicians to make policy decisions with an eye towards their future employment prospects. How can Trump honestly ask Congress to behave as true public servants, when his motives are in question from the beginning?
Trump selling his interests in the Trump Organization and putting them in a blind trust wouldn’t be unprecedented. It would be expected -- and for good reason. Here, recent history is a good teacher.
In 2008, there was significant backlash after the bank bailouts. In fact, the response was so great, it arguably altered the U.S. political landscape forever – giving rise to the Tea Party and Occupy Wall Street movements. The image of bankers being bailed out by taxpayers while average Americans were thrown out of their homes demanded a public response.
Imagine how much more ferocious that response would have been had Hank Paulson, the architect of the bailouts, not sold his roughly half a billion dollars in Goldman Sachs stock when he was nominated to be Treasury secretary. The bailout, which provided a $10 billion loan to Goldman and allowed it to further collect $12.9 billion from AIG when it was bailed out, already reeked of favoritism, given Paulson’s prior ties to Goldman. Had Paulson still owned his huge stake in the investment bank, there would have been rioting in the streets. The bailouts themselves might have been jeopardized – collapsing the world economy.
How about Dick Cheney divesting himself of his ownership in Halliburton? The company was on the receiving end of a multibillion-dollar “no-bid” contract. Imagine the public outcry against the administration had Cheney still owned roughly $40 million in his former employer’s stock. His prior ties to Halliburton were already grist for the media organizations that aligned with Democrats. The loss of trust between the Bush administration and the public would have spanned ideology if Cheney were to have personally profited from the war in Iraq.
If I were to speak directly to the president-elect, I’d tell him: “I understand that divesting your ownership in the Trump Organization is far more complicated than selling publically traded stock. The process could take a year or more and trigger numerous changes of control and other transfer-related provisions that would cost you some money. Public service, by its very definition, implies sacrifice. In the context of your multibillion-dollar fortune and the solemn honor that Americans granted to you in electing you president, it would be a small price to pay.
“You were elected to drain the swamp. You painted a picture of the Clinton Foundation as being an elaborate pay-to-play scheme intended to enrich the Clintons personally. If you don’t divest yourself and your family of the Trump Organization in its entirety and place the proceeds of the sale into a true blind trust, you will actually be guilty of far worse than what you accused the Clintons of doing.
“You will be destroying the hope that millions of Americans entrusted in you, and you will become yet another example to these same voters that the system is rigged against them.”