Donald Trump has an inflated sense of self-worth, quite literally. In his first campaign financial disclosure—filed in the summer of 2015 and memorably accompanied by an all-caps declaration that he was worth “MORE THAN TEN BILLION DOLLARS”—he valued his brand alone at a staggering $3.3 billion. Few, if any, independent experts agreed, but no matter. Since Trump never released his tax returns, and Federal Election Commission disclosures such as the one he filed can be so vague as to be nearly worthless where the ultrarich are concerned, the best anyone could do was offer an educated guess, which Trump could then simply ignore.
The uncertainty about what Trump and his name are worth mattered during the campaign because it was that same value that Trump used to sell himself to voters as a uniquely successful businessman. But now that same uncertainty matters for a different and far greater reason: It creates an opportunity for companies or individuals to pay the president of the United States directly without Americans having any way of knowing what, exactly, they are paying for.
This loophole—or I suppose, this particular loophole given all the other ones—arrives in the form of a Trump licensing deal.
Trump already earns a sizeable chunk of change licensing his brand to manufacturers and real-estate developers who pay good money to slap his name on anything from wine bottles to condos to television game shows. In the past, the decision to go into business with Trump on such ventures was a straightforward one: Would having the Trump name on your product make you enough extra money to compensate for what you paid Trump to put his name on your product in the first place? But now that Trump’s in the Oval Office, that equation might involve a new variable: Does paying to use Trump’s name also buy you a favor from President Trump, whether in the form of access or a sweetheart deal?
Yes, that question now hangs over every interaction with the Trump family business, but what makes a licensing deal different from a more straightforward consumer interaction is that we generally know what it costs to spend a night at a Trump hotel or play a round at a Trump golf course. We have almost no idea what the Trump Organization charges for the Trump name, and that’s by design. Private businesses almost never reveal the specifics of such deals since doing so could cost them down the road.
“As soon as you release it, you’ve set the price, and every other company out there sees it,” said Tim Calkins, a marketing professor at Northwestern’s Kellogg School of Management. Once that happens, you’ve effectively put a cap on how much you can ask for when the next company approaches you with a similar idea. Given Trump’s steadfast refusal to sacrifice his financial interests in the name of his presidency—to say nothing of his family’s professed love of deal-making—there’s no reason to believe the Trump Organization will make public the specifics of any new licensing agreement it negotiates or existing ones it renegotiations while Trump is president. Tellingly, Trump’s lawyers have said nothing to suggest the “vigorous vetting” they’ve promised for any new domestic deals would include a disclosure component.
Making matters more complicated is that even if the details were to leak, it still might be difficult to determine if Trump’s sons were charging a fair-market value. It’s relatively simple to compare the rate of one five-star hotel to that of another, but it may be impossible to find a comparable name to Trump’s. Few if any brands can match Trump’s unique mix of sweeping name recognition and stark polarization. And then there’s the reality that Trump’s name is worth different amounts to different companies, which all have their own ways of arriving at a value. “Some might look at consumer perception—how positive is the brand compared to others in the space—while others are more focused on the financial metrics,” said Jonah Berger, a marketing professor at the University of Pennsylvania’s Wharton School. There are ways to measure a specific brand value with market research, he told me, “but this isn’t a science.”
How, then, can we know if a company is paying a presidential premium to do business with Trump? And if they are, how can we know if they’re paying it because Trump’s brand is simply worth more now that he’s president (unseemly albeit not unethical), or if they’re hoping to grease the administration (unseemly and unethical)? We can’t, and that’s a problem since it gives Trump and his would-be business partner a built-in excuse if anyone were to suggest the Trump family is getting more for its name than it’s actually worth.
And remember: Trump says he’s no longer making the business decisions at Trump Tower, but he still holds a financial interest in his family company and—it should go without saying—in his actual name, which is what his company is selling in these deals. Trump has promised to be a silent partner in his business while he’s in the White House, but he’ll still be a partner. Any way you cut it, then, paying for the rights to the Trump brand means paying to go into business with Donald J. Trump, president of the United States.