The Many Potential Conflicts of Interest in Trump's Cabinet

Words and code by Benjamin Cooley | 28.04.2017

Conflicts in Cabinets

Since Donald Trump declared his candidacy for President nearly two years ago, his complex financial relationships have been the subject of much scrutiny. The media has scoured his past transactions in real estate to point out potential conflicts of interest that the President may face while in office. Many have found thee amount of connections Trump holds as reason for concern, like this Wall Street Journal piece displaying the over 500 potential conflicts of interest that could face Donald Trump and his family while in office.

But what about Trump’s cabinet? Though there has been some analysis of the conflicts of interest facing high profile cabinet members such as Rex Tillerson, not much has been said on the connections held by people who arguably, have just as likely a chance of facing conflicts of interest. As cabinet members, they presumably have the President’s ear and can influence policy direction.

The Office of Government Ethics board is responsible for vetting all incoming White House cabinet nominees every four years. Before a nominee can be officially appointed, the board must review all potential conflicts of interest and recommend methods of divestment to rid them. However, during confirmations the Trump administration again showed its affinity for unprecedented maneuvers: many confirmations reportedly began before the board had adequate time to review conflicts. The Director of the Office of Government Ethics board responded with an official letter saying the board “will not succumb to pressure to cut corners and ignore conflicts of interest.”

Now, on the eve of Trump’s 100th day in office, the President has succeeded to pass all his cabinet nominees through the Senate (with two exceptions: Andrew Puzder withdrew and Michael Flynn resigned). And while Trump himself may still present the most glaring conflicts of interest, his cabinet is far from innocent.

Here are a few areas of concern when it comes to conflicts of interest for Trump's cabinet members. Hover over a node to the right to learn more about the nature of a connection. Click and drag a node to reposition it.

Oil and energy ties

Though the most obvious connection to the oil industry in Trump’s cabinet is clearly Rex Tillerson, ex-CEO of ExxonMobil, there are still many other potential conflicts. As previous Attorney General of Oklahoma, Scott Pruitt has a long history of battling the EPA on behalf of the energy sector. Of these lawsuits,12 out of the 14 cases against the EPA involved companies who had donated either to Pruitt’s Attorney General campaign or a PAC that backed him. It’s no surprise that Pruitt was the first EPA nominee that the Environmental Defense Fund has opposed in it’s entire 50-year history.

In his campaign for EPA, Pruitt gained considerable support and donations from PACs and Super PACs backed by large energy conglomerates. Pruitt used to serve as Chairman of the Republican Attorneys General Association, a group that has accepted $4.2 million from fossil fuel companies since 2013.

During his time as chairman, he launched the Rule of Law Defense Fund, a 501(c)(4) non-profit that isn’t required to disclose donors. This fund received $175,000 from Freedom Partners, the PAC that organizes the political activity of the Koch brothers.

Liberty 2.0 is another Super PAC that campaigned for Pruitt as the head of the EPA. Weeks before the oral arguments debating the EPA’s Clean Power Plan, Liberty 2.0 received $50,000 from the major coal company Murray Energy. A year earlier, the PAC also received $50,000 from Lucas Oil Products. Throughout his history in the public sector, Pruitt has rubbed shoulders with some of the most influential energy companies in the US. During his time as a state representative, he was a member of American Legislative Exchange Council (ALEC), a group that connects policy makers with lobbyists to introduce new bills across the country. Sponsorship from big oil and coal companies has long been part of ALECs conferences. According to the Center for Media and Democracy, one third of all sponsors for their 2014 annual conference were “dirty energy companies”. Scott Pruitt was a guest speaker on the dangers of the EPA’s Clean Power Plan.

And then there’s Tillerson, the longtime face of ExxonMobil and big oil mogul. More so than any other cabinet member besides Donald Trump himself, Tillerson’s relationship with Russia has drawn question marks. Through his career Tillerson has made various business deals and contracts in Russia, most notably with the Russian state-owned oil company Rosneft. He apparently left a good impression in the process: Vladimir Putin awarded him the Russian Order of Friendship in 2006. As Secretary of State, Tillerson is in a position to withdraw sanctions against Russia. These sanctions have over the years cost ExxonMobil billions of dollars. Tillerson has allegedly taken steps to rid himself of his conflicts of interest by selling 600,000 shares in Exxon and placing his retirement package in a blind trust. He is also expected to recuse himself from issues that may affect ExxonMobil for his first two years in office.

Carl Icahn, who will serve as a special advisor on regulatory reforms to President Trump, has a huge amount of investments in the energy sector as well.

Big business, banks and Goldman Sachs

Trump appears to have stuck with his politics-as-business approach to governing by nominating lots of people from large corporations and banks. But most notably, he’s also appeared to bring in a fair bit of the “swamp” of Wall Street that his campaign was so hell-bent on draining.

New Secretary of Treasury Steve Mnuchin was a former Goldman Sachs partner. He also served for four years as director of OneWest Bank. Stephen Bannon also has a former history with Goldman Sachs in an executive banking role. Gary Cohn, the outgoing president of Goldman Sachs, is set to be Trump’s director of the National Economic Council.

Trump’s recruitment of Goldman Sachs alumni doesn’t stop at the cabinet however. Though not a member of Trump’s cabinet, the President’s pick for head of the SEC, Jay Clayton, has a long history as a lawyer defending big banks on Wall Street. He played a key role in advising Goldman Sachs on the government bailout plan following their controversial crash in 2008. As the head of the SEC, Clayton would be responsible for rooting out the kind of financial crime that Goldman Sachs was involved in to cause the economic crisis. Clayton’s wife also works for Goldman Sachs as private wealth advisor.

It’s worth noting that having former Goldman Sachs employees in government positions is not overly controversial in itself. For the past 16 years, multiple Goldman Sachs alumni have had positions under a President. But naturally, the contrast to Trump’s “drain the swamp” rhetoric of corruption in government and on Wall Street doesn’t sit well with most. And as economics writer Joseph Lawler explains, Goldman Sachs invests heavily in training its employees for a future in finance and government, which has led to government officials who will naturally be pro-Wall-Street. As a financial instituion, Goldman Sachs appears to also serve as a boot camp in political revolving doors.

Billionaire advisors

Trump’s administration is the wealthiest in history by far, at over $13 billion in collective net worth. Including himself, the cabinet contains four billionaires. Amassing a large net worth over a career isn’t alarming in itself. Indeed, this kind of skill could be valuable in certain government positions. But a long history of business interests and involvements can also mean more parties to potentially disappoint, more relationships to keep on good terms.

But some of the real money actually lies outside of Trump’s official cabinet picks. Carl Icahn, who will serve as special advisor on regulatory reform, is worth a staggering $17.8 billion. Icahn has a huge amount of holdings and investments in the energy sector. As a non-cabinet employee, Trump’s team has claimed that Icahn is exempt from conflict of interest scrutiny since he is not technically a federal employee. But Richard Painter, who served as chief ethics lawyer under President George W. Bush, called this kind of situation an “ethics minefield” and could lead to potentially sticky situations in court.

Previous administrations have had to deal with this potential problem as well. During the Obama administration, Commerce Secretary Penny Pritzker was worth around $2.5 billion. Most of this wealth was amassed from family involvement in co-founding Hyatt Hotels. After strict scrutiny from government ethics boards, Pritzker divested 220 separate holdings and resigned from positions at 158 different organizations before her confirmation in 2013. Many of Trump’s official cabinet nominees are being pushed into the same process. Wilbur Ross, incoming Commerce Secretary resigned from his position on the board of ArcelorMittal, the world’s largest producer of steel. Yet this situation doesn't necessarily bring an end to his potential conflicts: ArcelorMittal stands to gain much more from decisions made by Ross as the Commerce Secretary than Hyatt Hotels would have from Penny Pritzker. Former Treasury Department official Gary Hufbaer, now senior fellow at the Peterson Institute for International Economics, explained in an interview with ProPublica: “there are a lot fewer conflicts with hotels than the steel industry. That’s a pretty qualitative difference.”

When looking at conflicts of interest between business and politics, it can be tempting to only focus on the quantity of it all - how many connections, how much worth, who knows who. And these can be important measurements, to be sure. But sometimes, it's the qualitative differences that end up resurfacing in the future. The members Trump placed in his Cabinet have immense power and responsibility in deciding the policy of America; it's wise to keep an eye on them.

  • Pruitt's ties with Super PACs

  • Pruitt's ties with Super PACs

  • Pruitt's ties with Super PACs

  • Rex Tillerson, Russia and Oil

  • Goldman Sachs Alumni

  • Defense turned prosecutor

  • Scale of worth

  • Donald Trump and his Cabinet

    Estimated net worth: