The Foreign Emoluments Clause has received some attention recently in connection with President-Elect Donald Trump’s decision to maintain some of his business assets. One question that arises is whether Trump’s businesses might conflict with the Clause if they engage in arms-length commercial transaction with a foreign government.
One reason to believe the Clause would not cover President-Elect Trump is Seth Tillman’s argument that the Clause does not extend to the President. But let’s put that to the side and examine whether the benefits from an arms-length transaction would constitute an emolument.
The Clause provides:
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.
In determining the original meaning of “emolument,” one initially looks to the meanings and usages at the time of the Constitution. Rob Natelson, an originalist legal scholar, has identified several different meanings and usages of the term from the time of the Constitution:
- “Emolument” could mean any advantage or benefit whatsoever, as in “they should be permitted . . . to share in the blessings of peace, and the emoluments of victory and conquest.” This was the broadest usage, and the common dictionary definition.
- “Emolument” could mean gain that was specifically pecuniary, including gain attached to a particular office and “private emolument”—that is, money from outside sources, such as trade: Examples: “that honor and emolument should naturally follow the fortune of those who have steered the vessel in the storm and brought her safely to port” and “The emoluments of the trade are not a compensation for the expense of donations.”
- It could mean the compensation—pay and fringe benefits—attached to a particular office, as in “such as his rank entitles him to . . . and without pay or any other emolument whatever.”
- It could mean the fringe benefits attached to a specific office but not the pay, as in “that his emoluments and one half of his pay be suspended” or “his request for pay cannot be complied with, and that all the emoluments he derives from the United States are to cease” or “he should be allowed the emoluments but not the pay.”
- It might include items such as living supplies, extra compensation, and reimbursement for expenses, as in “The value of the additional emoluments of forage and subsistence would amount at the rate of thirty six dollars per month . . .”
- Or it could exclude one or more of these items, as in “the Post-master general make such an allowance to the postmaster . . . in addition to the emoluments of his office, as may be a reasonable compensation for his extra services” or “[Pennsylvania] President Franklin moved . . . that the executive should receive no salary, stipend or emolument for the devotion of his time to the public services, but that his expenses should be paid.”
Based on these examples, it appears that whether the term covers an outside commercial transaction depends on which meaning was employed. The first two usages would cover it, the next four would not.
How then to resolve the ambiguity? In my next post I use various legal interpretive rules to attempt to resolve the ambiguity.