Cabinet picks must do more than Trump to avoid conflicts

Trump’s family members (Pictured) also are preparing for Washington. Jared Kushner, Trump’s son-in-law and his newly announced senior adviser, said Monday he would resign as CEO of his family’s real estate company and as publisher of the New York Observer. (Photo: Donald Trump/ Facebook)

WASHINGTON –President-elect Donald Trump and his pick for secretary of state, Rex Tillerson, have much in common. Both are wealthy, long-time business leaders with broad international interests. But they’ve taken far different approaches to preparing for government service. Tillerson has severed his business ties. Trump has not.

As the president-elect prepares to announce his “very simple” plan for separating from his private enterprise before taking office in less than 10 days, few expect Trump to go as far as people who will serve under him. Conflict laws passed in the wake of the Nixon-era Watergate scandal govern senior White House officials but not the president and vice-president. That’s created a two-track system where the federal employees are subject to more financial scrutiny and sacrifice than their boss.

Those two standards will be put on full display Wednesday, as Trump announces his plans at a news conference, while Tillerson faces his confirmation hearing in the Senate.

In advance of the hearing, Tillerson, the longtime chief executive officer of Exxon Mobil, last week agreed to leave the energy company, sell his millions of shares in stock and put the cash he receives into a trust to be overseen by a third party. He’d been with Exxon since 1975, serving as its number two for the past decade.

That’s exactly what good government groups and former White House counsellors have been urging Trump to do.

“Rex Tillerson is doing the right thing,” said Paul S. Ryan, vice-president of policy and litigation at the non-profit Common Cause. “I hope Trump follows the lead of his own Cabinet nominee.

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Trump so far has provided few details about how he will separate from his international real estate development, property management and licensing company. He has said he will not be involved in Trump Organization’s day-to-day operations, leaving that to his two adult sons. But he has not addressed the stickier issue of whether he would retain a financial interest in the company.

“All I can say is, it’s very simple, very easy,” Trump told reporters Monday during a brief appearance at his Trump Tower.

Trump’s family members also are preparing for Washington. Jared Kushner, Trump’s son-in-law and his newly announced senior adviser, said Monday he would resign as CEO of his family’s real estate company and as publisher of the New York Observer. He will also divest “substantial assets,” said his lawyer, Jamie Gorelick. Kushner’s wife, Ivanka Trump, will not be taking a formal role in the White House, but she will end her executive roles at the Trump Organization –her father’s company –and her own fashion brands.

Although not bound by conflict laws, previous presidents have traditionally followed the laws that apply to other federal officials. In the 1970s, President Jimmy Carter sold his Georgia peanut farm and placed the cash in a trust overseen by an investment manager. “I don’t want any decision that I make as president to have any effect on my own income,” a crestfallen-looking Carter told reporters at the time of the sale.

But Trump has shown little interest in precedent when it comes to his financial matters. He is expected to be the first president since Gerald Ford to take office without making public his tax returns during the campaign. Vice-President-elect Mike Pence released his.

Ethics experts have argued that Trump’s limited approach to conflicts of interest could set a bad example for those who work for him.

“So far we have witnessed Trump’s cabinet nominees jump through the required ethics hoops,” said Scott Amey, general counsel for the Washington watchdog group Project on Government Accountability. “Trump should follow that path and set the ethics bar high by divesting and letting an independent manager take over. Anything short of that sends the wrong message to government officials and taxpayers. The president should play by the same rules and lead by example.”

The Office of Government Ethics said over the weekend that some of Trump’s nominees have yet to file all of their paperwork on possible conflicts of interest even though Senate confirmation hearings began Tuesday. Transition officials said the nominees have the process well underway, and there’s no requirement that the nominees complete their divestment plans before the Senate hearings.

As of Tuesday, the ethics office had released agreements and financial disclosures for Tillerson and six other Cabinet-level Trump appointees, including Sen. Jeff Sessions, the nominee for attorney general.

Others are pending.

Billionaire private equity investor Wilbur Ross, nominated to be secretary of commerce, has yet to detail his extensive portfolio. On a questionnaire released last week by the Senate Commerce Committee, he wrote: “Any potential conflicts of interest will be resolved in accordance with the terms of an ethics agreement into which I will enter with the department’s designated agency ethics official and will provide this to the committee.”

Ross said he is consulting with ethics officials at the department he’s been chosen to head, and with the Office of Government Ethics. That’s also the case for Labor Secretary prospect Andrew Puzder, who is chief executive officer of CKE, the company that owns restaurant chains including Carl’s Jr. and Hardees.

Disentangling efforts sometimes come with a financial cost.

Tillerson’s Exxon cash-out, for example, means he will lose about $7 million compared with what he would have been paid if he retired in March as planned before Trump chose him as the nation’s chief diplomat.

His simple and thorough approach to ending his business ties has drawn plaudits even from Democrats. Sen. Chris Coons, a Delaware Democrat, said in an NPR interview last week that he was pleased Tillerson had not followed his new boss’ lead.

“I complimented him on how swiftly he has completely severed ties from ExxonMobil, and pointedly said to him that my real concern is that President-elect Trump has not released his taxes, has not come up with any plan for severing his ties to his global business enterprise,” Coons said in the radio interview.

The president-elect first promised a news conference Dec. 15 to discuss his plans for the Trump Organization, but that was delayed until this month as lawyers and advisers worked through the complexities involved in the 70-year-old’s business empire, amassed over his entire adult life.

A financial disclosure last May says the billionaire earned $557 million over the previous 17 months.