Stephen Colbert got tangled in the ‘Trump transaction tax’—and it affects all investors

Stephen Colbert, the CBS late-night talk show host, was unequivocal in his assessment of Paramount Global’s $16 million settlement with President Donald Trump. “I believe this kind of complicated financial settlement with a sitting government official has a technical name in legal circles,” he said. “It’s a big fat bribe.” Soon after, CBS announced that “The Late Show with Stephen Colbert” would air its last show in May 2026. According to news reports, Paramount and CBS said the cancellation “is purely a financial decision against a challenging backdrop in late night. It is not related in any way to the show’s performance, content or other matters happening at Paramount.” The Paramount-Skydance Media merger Colbert referenced is a perfect example of the “Trump transaction tax” and “Trump transaction trap.” Paramount paid President Trump $16 million to settle a lawsuit about a “60 Minutes” segment—something observers believe was necessary for Paramount and Skydance to obtain Federal Communications Commission approval for the deal. While $16 million may not be material in the context of the $8 billion deal, the trap is. By paying it, Paramount’s board is open to potential bribery charges, and/or the possibility of derivative shareholder suits. Shareholders could claim that settling the lawsuit, widely perceived to be frivolous, was a waste of corporate assets. But a possible defense—that it was necessary to obtain deal approval—may be worse: providing something of value to a public official with the intent to influence their regulatory oversight is the very definition of a bribe.

[Blair Levin is the policy adviser to New Street Research, an equity research firm. Previously, Blair served as chief of staff to FCC Chairman Reed Hundt and directed the writing of the United States National Broadband Plan.]