Three days before his 2025 inauguration, Donald Trump launched a cryptocurrency called $TRUMP. That May, he dined with 220 of its largest holders, some of whom bought up the coin expressly to secure invitations. In October Mr. Trump pardoned Changpeng Zhao, a Binance co-founder who had been convicted of violating money-laundering laws. Binance had assigned a team to develop the stablecoin for World Liberty Financial, a crypto venture tied to the Trump family. The undertaking netted Mr. Trump hundreds of millions, part of $1 billion in crypto gains, while most token buyers lost money. Last year Paramount agreed to pay Mr. Trump $16 million—with some payments made to his future presidential library—to settle a lawsuit it had called meritless, and within weeks the government approved its $8 billion merger with Skydance.
Each episode has been reported, with people raising questions about Mr. Trump’s behavior. But what makes such conduct possible in the first place? Democrats rightly blame the man.
Listen
(3 min)
FREE EXPRESSIONA Daily Newsletter From WSJ Opinion
SIGN-UP FOR THE FREE NEWSLETTER
Gurdon: Return of the Monoculture
Hennessey: Vance vs. Rubio: The Shadow Primary
- Opinion
- CommentaryFollow
Big Government Inevitably Invites Corruption
Democrats blame Trump, but their policies would create more opportunities for the selling of favors.
By
Marian L. Tupy
July 20, 2026 2:00 pm ET
Listen
(3 min)
Three days before his 2025 inauguration, Donald Trump launched a cryptocurrency called $TRUMP. That May, he dined with 220 of its largest holders, some of whom bought up the coin expressly to secure invitations. In October Mr. Trump pardoned Changpeng Zhao, a Binance co-founder who had been convicted of violating money-laundering laws. Binance had assigned a team to develop the stablecoin for World Liberty Financial, a crypto venture tied to the Trump family. The undertaking netted Mr. Trump hundreds of millions, part of $1 billion in crypto gains, while most token buyers lost money. Last year Paramount agreed to pay Mr. Trump $16 million—with some payments made to his future presidential library—to settle a lawsuit it had called meritless, and within weeks the government approved its $8 billion merger with Skydance.
Each episode has been reported, with people raising questions about Mr. Trump’s behavior. But what makes such conduct possible in the first place? Democrats rightly blame the man.
But there is another culprit. The power of the federal government, which commands the fate of every major enterprise in America. A tariff waiver can mean billions for one company and bankruptcy for its rival. An antitrust filing can erase a decade of shareholder value in an afternoon. A procurement decision can build a company, and a regulatory finding can bury one. When the government holds that much influence, officials need not even demand tribute. Tribute arrives on its own.
The problem arose long before 2025. When government can make or break a business, businesses will invest in making friends with government, and the return on a lobbyist will exceed the return on an engineer. Corruption and discretionary power go hand in hand.
There is a remedy, though it comes from an unfashionable quarter. Libertarians have long argued for a wall between the economy and the state: a government confined to courts, defense and a handful of public goods—too small to be worth bribing. Nobody buys favors from an office that has no favors to sell. A president who can’t reward a donor with a tariff can’t be paid for one.
The Democratic Party rejects that remedy. Its answer to the corruption it decries is personnel: Elect us, and we will staff the agencies with people of integrity. The claim deserves scrutiny rather than applause.
about:blank
James Buchanan, who received the 1986 Nobel Memorial Prize in Economic Sciences, and Gordon Tullock argued in their 1962 book, “The Calculus of Consent,” that politicians and bureaucrats respond to incentives just as merchants and consumers do. Buchanan called for “politics without romance.” Voters may imagine that office transforms self-interest into public spirit, but no mechanism exists to perform that transformation. The behavior of officials is governed by what the office rewards, not by what the campaign promised.
Friedrich Hayek, another Nobel laureate, carried the argument further in “The Road to Serfdom” (1944). A state that dispenses fortunes will attract the people most eager to dispense them; positions of discretionary power select for those who relish wielding it. Screening for virtue can’t prevent that, because the applicant pool is already sorted by appetite, and the appetite grows with the budget.
The Democrats’ proposed programs would let officials choose which factories rise. Subsidies for favored technologies would let officials choose which investors prosper. Price regulation would let officials decide which companies earn a profit—and which don’t. Every one of these tools gives officials more decisions to sell, and every decision worth money to a business is a decision some business will pay to shape. A party proposing to multiply the levers of economic power is proposing to multiply the buyers lining up to pull them.
The question for Democrats isn’t whether they disapprove of the current president’s conduct. It is what feature of their program would prevent similar conduct under a president of either party. Their platform contains no such feature, demanding instead more agencies, more waivers, more approvals—more of the raw material from which favors are minted. To the question “Why would your government be cleaner?” the answer “because we are better people” isn’t convincing. It is a request for faith that Buchanan and Tullock’s public-choice theory gives us every reason to withhold.
That may solve a puzzle that has vexed the president’s critics. Their charges are documented, yet the charges don’t move voters as they should. Perhaps the voters have intuited what Mr. Trump’s critics haven’t, or pretend they haven’t—that the accusers propose to keep the machine and merely change the operator. An electorate offered a choice between two managers of the same favor factory may reasonably shrug.
The Founders foresaw figures like Mr. Trump. They did not foresee a government of the current scope and size. The way to end the sale of government favors is to close the store. Until one of our parties says so, the outrage will remain what it is today: sincere and useless.
Mr. Tupy is a senior fellow at the Cato Institute
THE ARTFUL DILETTANTE 