The Volokh Conspiracy

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Volokh Conspiracy

George Washington was the first president to stay in the real estate business

|The Volokh Conspiracy |

In today's Wall Street Journal, I have an op-ed, "Did George Washington Take 'Emoluments' "? It examines the first president's extensive and hands-on business affairs to get a better handle on the nature of constitutionally prohibited "foreign emoluments."

Here's an excerpt (article requires a subscription):

Mr. Trump is not the first president to have business dealings with foreigners. That was actually George Washington, whose conduct in office has been a model for every president.

By the 1790s, Washington was wealthy primarily because of real estate—renting and selling his vast holdings. As with Mr. Trump's hotels, Washington's renters or purchasers could include foreigners.

The president received constant reports from his nephew and subsequent managers and wrote to them at least monthly… This belies the notion that the Constitution limits a president's management of, or benefit from, his existing business ventures.
One letter written by Washington deserves great attention in the current debate. On Dec. 12, 1793, Washington wrote to Arthur Young, an officer of the U.K. Board of Agriculture, an entity newly created and funded by Parliament at the initiative of William Pitt. The president asked for Young's help in renting out his Mount Vernon lands to secure an income for his retirement. Not finding customers in America, he wondered if Young, with his agricultural connections, could find and organize some would-be farmers in his home country and send them over.

The op-ed is drawn from a larger research project on Washington's business interests and the prohibition on emoluments. Here, I'll take the space to address possible limitations to this evidence. In particular, Washington insisted that his December 1793 letter to Young be kept private. (Prof. Seth Barrett Tillman has presented strong evidence of the allowance of business dealings from Washington's public conduct in relation to the domestic emoluments clause.) He suggested that "in the opinion of others, there [may] be impropriety" in his solicitation but makes clear that he himself disagreed with that position.

In the context of Washington's correspondence with Young, the "impropriety" is almost surely not constitutional in nature. Young and Washington had long exchanged agricultural observations about their respective countries. The former had repeatedly requested that he might reprint some of Washington's decidedly apolitical musings in a respected series he published, "The Annals of Agriculture." (Washington was happy to receive copies of the books as gifts, even as president.)

Crucially, even before assuming the presidency, Washington vehemently insisted on keeping their rather banal exchanges strictly private. Given the great pains he took with his reputation, he explained, he would be chagrined of something "however distant itself from impropriety" would nonetheless "give occasion for one officious tongue to use my name with indelicacy."

While he does not elaborate on the nature of the "impropriety," it seems that they were about political optics, rather than constitutional constraint. Indeed, in his December 1793 letter, the president asked Young himself—hardly an expert on the U.S. Constitution—whether he saw anything untoward about it. The sensitivity seemed to be about the U.S. president seeking to induce migration from a foreign country. Thus Young replied that Washington's discretion was "founded in great delicacy of sentiment, but there is nothing in the laws of England … which can occasion the least hesitation on the subject."

Whether Washington was right or wrong in directly propositioning an official of a foreign semi-governmental agency to help him in a business venture thus remains a question. But it does suggest that Trump, with his business practices—far more greatly mediated and attenuated, through both managers and publicly traded entities—is in good company, down to the "officious tongues."