Key Takeaways
- No federal statute bars a president from owning or managing private businesses, and the main criminal conflict-of-interest law does not apply to the president.
- The Constitution's Emoluments Clauses restrict payments from foreign governments and from federal and state governments, but no court has ruled on how they apply to a president's businesses.
- The first-term emoluments lawsuits ended in 2021 when the Supreme Court ordered them dismissed as moot, leaving political oversight and impeachment as the main checks.
Can a sitting president keep running a private, profit-making business from the White House? And if the law allows it, what keeps conflicts of interest in check?
In this TalksOnLaw Brief, Judge Andrew Napolitano, a former judge of the Superior Court of New Jersey and host of the program Judging Freedom, explains that the short answer is yes. He contrasts the president's position with the rules that bind other officials and explains why, in his view, a president's exposure for business conflicts is political rather than legal.
No Statute on Point
Judge Napolitano notes that many federal and state laws stop members of Congress, federal judges, and state governors from running private businesses while in office, but that no comparable statute applies to the president or the vice president. A president could build an office tower or an apartment building, or invest in a complex in Dubai, and still manage those investments directly or through his children. Federal law bears out the point in one respect: the main criminal conflict-of-interest statute, 18 U.S.C. § 208, does not reach the president or vice president, because of how 18 U.S.C. § 202(c) defines the officers it covers.
A Political Check, and Impeachment
Because no statute governs a president's private profit-making, Judge Napolitano treats potential conflicts of interest as a political problem. If a president used his official power to make a decision in order to enhance his own wealth, he says, he would face severe political criticism, and perhaps impeachment if the conduct could be argued to rise to the level of bribery. If he could tolerate the political firestorm, however, no legal action would follow.
What to Know Now
The debate this brief anticipated soon turned to the Constitution's two Emoluments Clauses. The Foreign Emoluments Clause bars federal officeholders from accepting any present or emolument from a foreign state without the consent of Congress, and the Domestic Emoluments Clause bars the president from receiving any emolument from the United States or any state beyond his salary. During President Trump's first term, members of Congress, the District of Columbia and Maryland, and plaintiffs led by the watchdog group Citizens for Responsibility and Ethics in Washington sued under these clauses, arguing that spending by foreign and state governments at Trump hotels and businesses was unconstitutional. Courts divided on whether the plaintiffs had standing to sue. In January 2021, after the term ended, the Supreme Court vacated the lower-court rulings and ordered the cases dismissed as moot, including in Trump v. Citizens for Responsibility and Ethics in Washington. No court has decided the merits, so the meaning of "emolument" remains contested. Those who favor a broad reading see the clauses as a meaningful anti-corruption safeguard; others read "emolument" as payment for official services, which would leave ordinary commercial transactions untouched. In President Trump's second term, his family's business ventures have renewed these arguments. In practice, the checks Judge Napolitano points to, public scrutiny, congressional oversight, and the impeachment power, remain the main ones, alongside voluntary disclosure and ethics arrangements.
