Contract law is (for me) the most exciting and satisfying area of law.
(Constitutional law and criminal law and media law are all very interesting in how they regulate real life activity, but only contract law is exhilarating. I once read Patrick Atiyah’s extraordinary Introduction to the Law of Contract in one go on a long plane journey, and the same author’s The Rise and Fall of Freedom of Contract is one of the best intellectual histories ever published.)
And so it is from a contract law perspective that this post looks at the question of whether Donald Trump, the businessman-turned-President, is “transactional” in his political approach.
This is certainly what many pundits are saying:
Are these pundits right?
Has this new conventional wisdom hit upon something?
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From a contract law – and contract lawyer’s – perspective, Trump is not “transactional”.
Indeed, he is the opposite of transactional: he is instead anti-transactional.
A transaction is a two-way process, an exchange where a party agrees to do a thing in return for another party agreeing to do a thing.
To use old-style language, a transaction is a bargain, an exchange of promises.
And for the business people concerned in a commercial transaction, that contract has sanctity. So if a party does not comply or even breaches the contract there are remedies which are intended to place the injured party in the position they would have been had the agreement been properly performed. Often these are “money” remedies, but sometimes they can be injunctions or other court orders.
The court will enforce what the parties had agreed, for the agreement is the thing.
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But for Trump, the agreement is not the thing.
An agreement is there to be opportunistically repudiated, and not to be performed.
An agreement offers an opportunity to gain leverage, for a new negotiation. for a new exertion of power.
This approach has also been spotted by one acute British observer:
For Trump, notwithstanding his ghost-written book The Art of the Deal, deals are not an art but about artfulness.
For Trump, a hire is only of any use so long as they can then be “fired”.
Transactions are just there for suckers.
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There is nothing inherently weak in this anti-transactional approach: and indeed it has proved successful for Trump, both politically and commercially.
And, yes, he does deploy the rhetoric of “the deal”.
But this only makes him transactional in the same way an atheist going on about “God” makes them a Christian. There is instead a positive disbelief in the words and concepts being used.
And so each supposed agreement with Trump is a mere marker for the next use (and abuse) of leverage: few if any transactions will ever be transacted. Things will move on, there will be new exertions of power, and new things demanded.
For Trump, a contract, like Littlefinger’s chaos, is a ladder.
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“Chaos isn’t a pit; it’s a ladder” seems to sum up Elon Musk’s political philosophy (if we can dignify “gleefully smashing things to bits as your wealth piles ever higher” with that term)
It is fascinating to see different perspectives on this subject.
To my sorrow and occasional shame, I spend a lot of time reading comments from what purports to be “the business community” cross the US, the Global South and parts of Europe.
their views are often very emotional, driven by a visceral loathing of legalities and bureaucracy (seen by many as the enemies of enterprise and progress). Trump is a hero to many. I wish some of these people would look at this analysis- but I have a feeling they might agree and yet see Trump’ approach as broadly positive. I do feel lost and horrified much of the time, right now.
The biggest flaw in this “gloves off” approach is that the proponents always imagine not only that transactions are always zero-sum but also that they will always be on the dominant side. So many of Trump’s former partners went on y to sob “I didn’t expect leopards to eat _my_ face!”
This era of US politics is terrifying. What will be left at the end of four years?
I fully agree with your analysis, but he doesn’t win all the time. He is very similar to a bully, zero sum game. However canada reannounced some old measures as new and Trump got the headline of “capitulation” and suspended tariffs. This tariff thing is a fan dance for the maga faithful not a revenue generator. He’s reliant on Musk cutting everything for his tax cut pay-off perhaps?
“Who compels us to keep the promises we make?” – Adolf Hitler.
To be fair to Neville Chamberlain he did say that his purpose in getting the infamous piece of paper was to provide irrefutable evidence that Hitler was entirely untrustworthy and he did support Churchill in fighting on after Dunkirk precisely because Hitler could not be trusted to keep to any peace terms
Thanks for this timely reminder of the basics of the deal – and why that’s not what the Trumpian order is actually about.
I would add that ‘might is right’, which better characterises President Trump’s modus operandi, carries within it the seeds of failure of any ‘deal’: consent clouded by fear or duress does not bind, leaving nothing but the appearance of an agreement, easily disposed of when circumstances allow…
I know some do not feel such fear or pressure (yet?), thinking they can ‘handle’ him and that ‘there is something to be gained’ from him. But if the statements that President Trump ‘does not feel he wins until and unless another party loses’ are true, then engagement is also a delusion.
And beyond the impact on parties to any such ‘deals’, the Trumpian approach puts entire systems of governance at risk – we can only note that past examples of such destruction have rarely kept their promises of long-term success.
So perhaps the only conclusion is that we urgently need to decide, individually and for the groups to which we belong (nations, philosophies, others) what we must stand up to protect… contractually or otherwise.
“Luca Brasi held a gun to his head, and my father assured him that either his brains or his signature would be on that contract.”
Trump has never been transactional as you rightly point out; just ask any employee, contractor, partner, wife or government with whom he’s agreed anything and subsequently found themselves stiffed when he fired or reneged on his “promise”
Trump is an open book, what you see is what you get, something the UK government of whatever shade, wallowing in its “special relationship“ fantasy, still fails to understand
It’s also something John Bolton, not the most savoury of US politicians warned everyone about & he should know.
Ask the myriad of construction suppliers Trump shafted breaking “transactions” the contracts and agreements he failed to pay in his many bankruptcies. He is a failed businessman in a masquerade in which he adopts postures and what he thinks are “statesmanlike” poses he has obviously practised in front of the mirror, like the Reality TV frontman he really is. He cannot be trusted further than one could throw him (and he is heavy). However, he is being very successful in one sphere: rapidly destroying what reputation the US had for good faith and adherence to international norms and the rule of law. One can only pray for his body’s timely ultimate myocardial response to a surfeit of burgers and sugared drinks.
Incisive as always David.
Unlike Americans, the man can’t be trusted to do the right thing, ever.
I’d say that Trump is transactional, but only in the sense that a toddler is transactional. A little kid can keep quiet for fifteen minutes if you offer them a bribe, but the bribe had better come at the end of the fifteen minutes. You can deal with Trump if you are the second to perform: the trusted party.
People don’t know the full story of Trump and his contractors. All they know is that Trump never paid his completion payment. What they don’t know is that the contractors had priced this into their bids, and had made their profit with their penultimate scheduled payment. (My guess is that Trump’s underlings knew this, but had enough sense not to tell their boss.)
Yup – I agree with this. Trump is transactional in the sense of, ‘I scratch your back, you scratch mine, you piss me off I’ll never forget.’ The purpose of applying that description to him is not to say he sticks to any deal, but to contrast him with normal politicians, who mostly look at policy from a broader angle than Trump usually does.
Thank you for this extremely observant analysis, and as a business lawyer you seem very clearsighted here. The only thing I´´m missing is the ethos in all this, the moral observation, but that we readers can add ourselves. From my viewpoint, there are no morals involved in either Donald Trump or what GOP has become, the Project 2025. There is no ethos. There is only the serving of oneself. If we look at the world and it´´s known history, there has been many anti-transactional people of power. Gangsters, corrupt politicians, and dictators come to mind. Surely some Kings and emperors too.
In some countries and systems they have been able to survive for long even in our times, like in Russia for instance. But they have always been toppled over sooner or later. Because what is good for an elite is never good for the people, and authoritarian rule is of course not good for the people. And a leader who only cares for his own benefits is useless for the people. And a populistic anti-transactional politician who wins the people´s votes by promising their benefit and the screws them the first thing he does, will lose his crown one way or another.