Trump Fusion Deal Sparks Conflict of Interest Concerns
The expansion of the Trump business empire into nuclear fusion is raising concerns among ethics experts, who caution that it presents significant conflicts of interest and risks the federal government showing favoritism in what could be the ultimate breakthrough in clean energy. Trump Media & Technology Group surprised market last week by orchestrating a $6 billion partnership with TAE Technologies, a Google-backed firm at the forefront of fusion energy. The merger indicates that soon, President Donald Trump will concurrently hold a significant financial stake in a company whose success will be affected by the decisions of a government that Trump himself leads. Nuclear fusion companies are under the oversight of the federal government and will probably require substantial research support and financial backing from Uncle Sam to achieve commercial viability. The merger requires approval from federal regulators, several of whom were appointed during Trump’s administration.
“There is a clear conflict of interest here,” Richard Painter stated. “Every other president since the Civil War has divested from business interests that would conflict with official duties. President Trump has done the opposite.” Painter stated that anyone other than the president or the vice president could be committing a crime if they engaged in a US government matter while being aware of their financial interest in it. For instance, he stated that the secretary of energy would need to recuse themselves from any matters related to fusion if they concurrently held a significant stake in a fusion company. “It’s only legal because the criminal conflict of interest statute does not apply to the president,” Painter said, adding that while it is “technically legal,” he doesn’t believe presidents should be excluded from the law. The fusion deal resulted in an instant increase in Trump’s net worth. On Thursday, the announcement of the merger led to a remarkable 42% surge in Trump Media’s share price. The value of the stake Trump holds through a trust has risen by $500 million, bringing it to a total of $1.7 billion. On Friday, Trump Media’s share price saw a continued rise, elevating the value of that stake to over $1.8 billion. Dan Ives informed clients in a note last week that TAE will “clearly have major political support from President Trump in our view and this importantly will create a major nuclear fusion US energy domestic bet over the coming years.”
Fusion represents an advanced energy source that seeks to emulate the very process that fuels the sun and other celestial bodies. It has long been regarded as a potential game-changer, as it would offer nearly limitless clean energy. However, fusion is not yet commercially viable, and to get it off the ground, it may require support from the federal government in the form of loans, subsidies, contracts, and research. “That’s why the public interest could be harmed if the merger creates an unfair advantage for Trump-backed TAE,” worries Kathleen Clark. “The risk is that one company will end up being a government favorite, not because of objective scientific evaluation, but because they paid off the president,” Clark said. “It brings to mind the Soviet Union’s practice of selecting scientists based on their professed ideology rather than their genuine accomplishments.”
Rep. Don Beyer expressed that he was “stunned” by the Trump Media deal. “I hate the thought of a president who puts his name on the Kennedy Center putting his foot on the scale of who the winners and losers are in fusion energy,” Beyer said. Beyer expressed that he has been “encouraged” by the Energy Department’s backing of fusion energy and is pleased to have a president who supports the industry. In October, the Trump administration unveiled a Fusion Science and Technology Roadmap that “aims to usher a burgeoning fusion private sector industry in the US toward maturity on the most rapid timeline.” However, Beyer pointed out that there are over two dozen fusion companies currently active in the United States, with some having made more significant progress in their development compared to TAE. “If the Trump engagement means the whole industry proceeds more quickly, that’s a win for humanity,” Beyer stated. “However, if it results in everyone else being disadvantaged and the government’s generosity is directed solely towards one company, that is detrimental to humanity and harmful to America.”
The White House dismissed worries regarding a potential conflict of interest. “The media’s continued attempts to fabricate conflicts of interest are irresponsible and reinforce the public’s distrust in what they read. Neither the President nor his family have ever engaged, or will ever engage, in conflicts of interest,” Karoline Leavitt said in a statement. Requests for comment went unanswered by both the Energy Department and the Trump Organization. Michl Binderbauer informed that he chose to merge with Trump Media because it provided the “last piece of the puzzle” in their effort to construct a power plant: capital. “Sometimes you get lucky and you meet the right people,” he stated. Binderbauer expressed that he is not worried about any potential political controversy surrounding the government support his company may need or receive, despite his collaboration with Trump. “I’m not looking for anything special,” he stated.
Following his election victory last fall, Trump moved his controlling interest in Trump Media to the Donald J. Trump Revocable Trust. Trump is the only beneficiary of that trust, which is overseen by his eldest son, Donald Trump Jr., who also intends to serve on the board of directors of the combined company. Clark stated that the transfer to a trust does not pertain to a conflict of interest. “It’s utterly meaningless. As a matter of ethics, it’s BS,” she said. Painter, the former Bush ethics official, asserts that the transfer to a trust is inconsequential since Trump maintains a financial interest. “That’s like saying, ‘I don’t own a piece of property just because I hired a property manager to take care of it,’” Painter stated. Painter stated, “There is a simple way for Trump to avoid the appearance of a conflict of interest.” “He should divest.” “Divest from nuclear fusion, social media and cryptocurrency,” Painter said.
