Legal experts say Trump official broke law by saying 'Buy Tesla' stock
but don't expect a crackdown
[March 22, 2025]
By BERNARD CONDON
NEW YORK (AP) — When a White House adviser in the first Trump
administration told TV viewers to “Go buy Ivanka stuff," top government
lawyers sprang into action, telling her she had violated ethics rules
and warning her not to do it again.
Government ethics experts have varying opinions on whether the 2017
criticism of Kellyanne Conway went far enough, but many agree such
violations now might not even draw an official rebuke.
A week after President Donald Trump turned the White House lawn into a
Tesla infomercial for Elon Musk’s cars, a second sales pitch by a U.S.
official occurred, this time for Tesla stock.
“It will never be this cheap,” U.S. Commerce Secretary Howard Lutnick
said Wednesday. “Buy Tesla."
Government ethics experts say Lutnick broke a 1989 law prohibiting
federal employees from using “public office for private gain," later
detailed to include a ban on ”endorsements." Although presidents are
generally exempt from government ethics rules, most federal employees
are not and are often punished for violations, including rebukes like
the one Conway got.
As of Friday, no public action had been taken against Lutnick and it was
unclear whether he would suffer a similar fate.
“They’re not even thinking of ethics,” said Trump critic and former
Republican White House ethics czar Richard Painter of administration
officials.
Painter has equally low expectations of that other possible brake to
future violations — public opinion: ”I don't know if people care."
In his first term, Trump opened his hotel near the Oval Office to
foreign ambassadors and lobbyists in what many legal scholars argued was
a violation of a constitutional ban against presidents receiving
payments or gifts that could distort public policy for private gain. His
company launched a new hotel chain called “America Idea” in hopes of
cashing in on his celebrity. Trump even once proposed holding a G-7
meeting of world leaders at his then-struggling Doral golf resort.
The ‘Buy Ivanka' rebuke
But the reaction to Conway’s “Ivanka stuff” comment suggested certain
lines couldn't be crossed.
Within days of Conway's TV comments, the head of the federal ethics
agency, the Office of Government Ethics, wrote a letter to the White
House saying Trump's adviser may have broken the law and urging a probe.
A White House lawyer then met with Conway to remind her of the law and
reported to the ethics office that she had assured him she would abide
by it in future.
But this time, there is no head of the Office of Government Ethics. He
was fired by Trump. Ditto for the inspector generals of various agencies
who would head any investigation.
“What is likely to happen now? I really don’t know,” said Kedric Payne,
chief lawyer at the Campaign Legal Center, a non-profit watchdog that
sent a letter to the government ethics office on Friday calling for an
investigation. "We no longer have the head of the Office of Government
Ethics to push the Commerce Department to make sure the secretary
acknowledges the law."
Payne said Lutnick's comment on TV may seem like a small transgression
but it could snowball into a bigger problem if not punished.
“It starts with one TV appearance, but can develop into multiple
officials asking people to support companies and products,” Payne said.
“If there are no consequences, you get into a danger zone of a
corruption.”
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President Donald Trump listens as Elon Musk speaks in the Oval
Office at the White House, Feb. 11, 2025, in Washington. (AP
Photo/Alex Brandon, File)
Trump critics point to other signs that Trump is careless with the
law and ethical norms, citing his pardons for Jan. 6 Capitol
rioters, a decision to allow his Trump Organization to strike
business deals abroad and his attack on the Foreign Corrupt
Practices Act banning U.S. company bribes abroad to win business.
Jelly beans and airlines
When it comes endorsing products, presidents used to be far more
circumspect.
Their comments were mostly quick asides expressing opinions of
taste, such as when Harry Truman called Pillsbury flour the “finest"
or John F. Kennedy said United Airlines was “reliable.”
Ronald Reagan famously enthused about his jelly beans habit,
remarking that they were the “perfect snack.”
Trump had five Teslas lined up in the White House driveway last week
as he praised Musk's company. Then he slipped into a red Model S he
had targeted for personal purchase, exclaiming, “Wow. That’s
beautiful.”
“Presidents are allowed to have personal opinions on products they
like and dislike,” said ethics lawyer Kathleen Clark, referring to
the Truman through Reagan examples. ”But what Trump did was
transform the White House into a set for advertising the products of
a private company."
"It’s the difference between holding an extravaganza and holding an
opinion."
Calls for Musk investigation
In the aftermath of the Tesla White House event, Massachusetts Sen.
Elizabeth Warren and three other senators wrote a letter to the
Office of Government Ethics saying that, while presidents are exempt
from ethics law banning endorsements, Elon Musk isn’t and calling
for an investigation.
A spokeswoman from Warren's office said the government ethics office
had not yet responded about what it planned to do about the White
House Tesla endorsement. The Office of Government Ethics itself said
it would not comment on either the Warren letter or Lutnick's TV
appearance.
The Commerce Department did not respond to Associated Press requests
for comment.
Asked whether Lutnick would be reprimanded or an investigation
opened, White House spokesman Kush Desai defended Lutnick, lauding
“his immensely successful private sector career” and his “critical
role on President Trump’s trade and economic team.”
Former White House ethics chief Painter says Democrats have also
played loose with the ethics law.
He is harshly critical of the Clinton charity, the Clinton
Foundation, which was taking donations from foreign governments when
Hillary Clinton was the country's chief diplomat as secretary of
state. Painter also blasts former President Joe Biden for not
removing his name from a University of Pennsylvania research
institute when he was in office even though it appeared to be
helping draw donations overseas.
But Painter says the slide from caring about ethics laws and norms
to defiance has hit a new low.
“There's been a deterioration in ethics," he said. “What Biden did
wasn’t good, but this is worse."
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