Power, Profit, and Washington’s Paradox

The Trump administration has been accused of corruptly placing private financial benefit above the public interest, most recently in President Trump’s acceptance of the gift of a Boeing 747 from Qatar for his use as Air Force 1, and invitations to dinner at a private club and to a private White House tour, offered as perks for those who invested substantial sums in his Stablecoin. Although, here, the President’s self-enrichment is blatant, more troubling are his policies aimed at dismantling safeguards against corruption at home and abroad. These reveal a deep contradiction in the warring goals of those currently governing in Washington; a contradiction that may eventually burst into the open.

Misuses of power

Corruption, defined as the misuse of public power for private gain, does not fully capture the nature of the regime that Trump is trying to establish – a regime whose chief executive analogizes himself to a king who can do no wrong and must be obeyed. The President seems blind to the very notion of a distinction between public and private interests. He and his family are seeking personal financial gain, as well as payback for past insults. He espouses a transactional view of governing – distinct from ethical or moral constraints related to the obligations of public service. At the same time, some advisors do have strong ideological commitments: some to a small state with low taxes, and others to a repressive form of law and order that seeks to limit immigration and to expel the undocumented.

The possibility that his own executive power could be “misused” lies outside the President’s field of vision. Public policies designed to improve government functioning through institutional and structural reforms to limit the incentives for payoffs and self-dealing are of no interest. Rather, the idea seems to be to tear down the existing guardrails inside the US government, in international business, and in the domestic private sector.

Thus, his personal ideal world appears to be what some call a kleptocracy, that is, a state dominated by quid pro quo transactions that benefit well-placed insiders and their private sector allies. Accordingly, the agenda of the global anti-corruption movement that seeks political-economic reforms and ethical behavior is irrelevant in a system where self-interest and self-promotion are paramount. In fact, in the real-word case of Hungary, David Jancsics argues that cleaning up low-level corruption was a strategy for increasing the rewards available for major players in both the public and the private sectors. In short, the term “corruption” hardly captures the extent of the problem. The concern is not that some public officials collude with some private sector actors to undermine particular policies or obtain excess financial benefits. Rather, the worry is that the link between democratic policymaking processes and implementation has been broken by a combination of inflammatory rhetoric, private self-seeking, and appointments based on litmus tests for personal loyalty.

Personalistic rule

In the United States, we are just beginning to see the consequences of Trump’s efforts at personalistic rule. So far, some of these seem almost comical. For example, consider the President’s acceptance of the gift of a Boeing 747-8 airplane from Qatar for his use as Air Force 1, saying that he is always happy to accept a gift. True, he claims that the jet would be a gift to the United States, not to him, but the Qatari’s attempt to curry favor with Trump and obtain lucrative investment deals is clearcut. Accepting the gift arguably violates the emoluments clause of the U.S. Constitution (Art. I, Sec. 9, Cl. 8). Although the Supreme Court has never ruled definitively on related issues that arose in his first term, the clause forbids him from accepting any present or Emolument “without the Consent of Congress” from “any King, Prince, or foreign state.”

But the 747 is just a particularly dramatic example. Equally questionable were Presidential invitations to a dinner at one of his private clubs and to a private White House tour offered as perks for those who invested substantial sums in his Stablecoin. The events created clear conflicts of interest between his public role and his financial interests and those of his family. Going further, a June 8 opinion piece by the New York Times editorial board outlined, “Trump’s Corrosive Culture of Corruption,” with a list of recent examples of self-dealing.

These actions are taking place in the light of a 2024 Supreme Court opinion, Trump v. United States, 603 U.S. 593 (2024), that granted the President immunity from criminal prosecution for “official acts” taken on the basic of exclusive presidential authority. Some of the actions taken by him and his family are balanced on the edge between official acts and personal financial deals negotiated by family members. Should his behavior count as an “official act” if it mainly provides financial benefits to his family and close associates? The answer should depend upon whether Trump sweetens the deal, for example, by providing individualized tax breaks or regulatory leniency or by exempting an international deal from oversight, even if he has nominally distanced himself from direct involvement. The usual American practice is for public officials to place their assets in a blind trust to avoid allegations of self-dealing. Trump has not done so, but, instead, as in his first term, he has turned over control of his company to his two elder sons. However, unless the deal involves criminal activity, such as bribery or fraud, the Supreme Court case would not be relevant. Rather, legal disputes would be over contract breaches or administrative violations that could have financial implications extending beyond his presidential term. Leaving aside Trump family’s nominal efforts to comply with ethical norms, opportunities for self-dealing remain given Trump’s his close relations with his family and their business opportunities.

Gutting the ability of government to contain corruption

The president’s efforts to enrich himself and his family, despite claims to the contrary, represent only the most obviously unethical activities undertaken by his administration. More lasting and consequential are policy initiatives that gut the ability of government to investigate and contain corruption throughout the US and in international business. These policies are occurring with no changes in the statutory framework but, instead, with executive orders, memoranda, and off-the-cuff statements. At the same time, anti-corruption laws could be weaponized against political foes or as threats to bring critics into line.

Many actions by the administration do not violate formal laws, but instead, illustrate that even a country as law-bound as the US, depends importantly on the moral and ethical principles that guide legal interpretations and provide a framework for social and economic interactions. Recent developments paint a troubling picture of the government’s ability to contain corruption, especially when combined with the 747 gift and the cryptocurrency social events. Consider a few prominent examples.

• Long before he entered the White House for the first time, Trump, a real estate developer, chafed at the constraints imposed by the Foreign Corrupt Practices Act [FCPA], a federal law that prohibits those subject to American law from bribing foreign government officials to benefit their business interests. See my January 2017 op-ed in The Hill. An executive order, issued on February 10, 2025 paused enforcement of open FCPA cases. In early June, the Department of Justice issued guidelines that emphasize corruption prosecutions linked to criminal cartels and with national security implications. Given the broad reach of U.S. criminal jurisdiction, the guidelines direct FCPA enforcement toward the protection of U.S. firms from corrupt competitors, not on investigating U.S. firms who make payoffs to obtain contracts or favorable treatment.
• As explained by Alexander Dziadosz in a recent article, Trump has disbanded an interagency taskforce, labeled KleptoCapture, designed to limit the ability of corrupt businesses and politicians to move funds across borders to avoid taxes and legal consequences.
• Pardons have been issued to convicted white-collar criminals, some guilty of corruption and related crimes, such as fraud. According to the New York Times, some on-going cases have simply been dropped. To illustrate the link to Trump’s political interests, consider the May 2025 pardon of Paul Walczak. He was convicted of tax crimes, and his mother raised millions of dollars for Trump’s campaigns, including an April fundraising dinner with Trump with an entry fee of $1 million per person.

However, many of the administration’s actions have no direct link to illegal payoffs. Many are simply raw exercises of bargaining power arising from “having the cards.” Biased regulatory actions and lucrative public sector contracts have favored Elon Musk’s companies and other Trump allies. Trump’s June 5 fallout with Musk was accompanied by threats to increase regulatory oversight or to cancel contracts. Similarly, the attacks against Harvard University and other higher education institutions, as well as the cancelation of specific research grants, are individualized efforts at retribution, not a thoughtful weighing of the costs and benefits. Federal funds have been canceled and visas withdrawn, not from a showing of corruption but for a range of poorly articulated reasons, if any. Similarly, the ups and downs of tariff rates have led to individualized dealmaking that interjects uncertainty into global trade with little concern for the long-term consequences of any resulting instability.

Most of these actions are not corrupt under US law but, at the very least, they often represent a conflict of interest that benefits Trump and his allies personally at the expense of the public interest. Although President Trump is violating accepted norms of political behavior, he has – so far – not flagrantly broken criminal laws. Nevertheless, he is violating numerous statutes and breaking government contracts, leading to multiple lawsuits. The organization Just Security is keeping a running tabulation of lawsuits. As of June 11, it has tracked 272 cases (counting the student visa cases as a single case). Many cases deal with immigration issues, broadly conceived, but many others concern contract terminations, the abolishment of programs, the firing of personnel, and the drastic shrinkage or abolishment of certain public programs or bodies.

Going forward, with Republican majorities in both the House and the Senate, statutory changes are possible that accord with Trump’s priorities. These may occur even though the Republican majority in the House is very small, and several Senators oppose some of Trump’s initiatives. The tax and spending bill making its way through the Congress will lead to massive cuts in spending for a wide range of social programs with substantive policy implications if enacted into law. The largest cuts would involve foreign aid, medical research, and programs to aid the poor including subsidies for housing and education.

In addition, Republicans are proposing a statutory change that would help business insiders to act in their own narrow interest. They propose to eliminate the Public Company Accounting Oversight Board [PCAOB], a watchdog created after scandals involving Enron and Worldcom that was designed to limit accounting fraud and audit failure. The proposal would absorb the PCAOB into the Securities and Exchange Commission, a body that has lost significant numbers of staff in recent months and that could well underemphasize the Board’s mission.

If the mid-term elections in 2026 reaffirm Republican control of Congress, we can expect more aggressive legislative moves, for example, repeal the FCPA or a rewrite of the federal bribery statute to entrench the permissive interpretation of bribery embedded in the Supreme Court’s McDonnell v. United States, 18 U. S. C. §201 (2016). The bribery statute makes it a crime for a public official to accept anything of value in exchange for performing an “official act.” The governor of Virginia had accepted valuable gifts from a businessman seeking favors, but the Court held that setting up a meeting, talking to another official, or organizing an event – without more – are not “official acts” because they did not involve the formal exercise of governmental power.

Contradictions and Tensions inside the Trump Administration

Finally, consider the deep contradictions at the heart of the Trump administration. On the one hand, if the wealthy wield political power, they may seek to distort government programs to benefit themselves. On the other hand, they may lobby for drastic cutbacks in the fiscal size and regulatory power of government. That latter option was the approach taken by the Heritage Foundation, a right-wing, free-market think tank, that prepared Mandate for Leadership: Project 2025,  as a blueprint for the new administration. Some drafters of that report now work inside the Trump administration and are seeking to put its recommendations into effect. But note the potential tension here.

True, a smaller government would present fewer opportunities for payoffs, unless the very scarcity of public benefits leads to an aggressive struggle for the limited supply. With the private market playing a dominant role, outcomes would rely heavily on the self-interest of private actors. Such a state would limit the provision of public goods and social welfare programs for the disadvantaged.

Yet, even in a minimal state, the risk of corruption is inherent in any effort to implement complex programs in the public interest. Thus, even in that case, policies should reduce the incentives for corruption, not merely through intrusive criminal law investigations, but also by redesigning programs to limit opportunities. For example, in the face of high levels of corrupt incentives, programs should be kept simple and easy to evaluate, even if that means sacrificing nuances that would be fairer and more efficient in an unambiguously honest world.

Unfortunately, such policy reforms are not on the administration’s agenda. Rather, its proposed reforms are mistaken on two grounds. First, many in the administration are very cynical about the propensity for corruption and misanthropy among both public officials and in the general public. As a result, they seek a minimal state with little regulation of business and with only a modest safety net. Second, self-seeking supporters of Trump urge the government to favor them or their business interests through both regulatory actions and spending decisions tilted in their favor, including contracts. The opportunists, including Donald Trump and his family, seek private financial benefits from their government connections.

Those worried about the unabashed self-interest of government insiders and favorable to the free market seek to shrink the scope of government to limit self-dealing. These advocates for small government point to the moral and ethical failing of others in arguing for dismantling the modern regulatory-welfare state. Thus, regulatory bodies, such as the Environmental Protection Agency, have been placed in the hands of political appointees who object to the underlying purposes of the laws they are meant to enforce. Will any of the libertarians inside the administration admit the paradoxical nature of their appointment and begin to attack the administration from the inside?

In short, there is a deep tension between two groups now wielding power in Washington. One seeks to limit the role of government in society, in part, because of their fear that corruption and self-dealing will undermine any affirmative government policy efforts. These people, however, have tied themselves to a highly personalistic administration peopled by a second group that views public sector involvement as an opportunity to enrich themselves at the expense of taxpayers, competitors, interest groups, and others seeking personal gain. Neither group is interested in constructive public policy reforms that improve social welfare, but, at the same time, the situation seems ripe for conflicts in particular programmatic areas such as public construction projects, tax policy, or national defense.