making local government more ethical
Updated: November 20, 2013 (see below)

The gift regulation proposed by Philadelphia's ethics board last week (attached; see below) provides a great opportunity to consider many issues involving gift bans and exceptions.

It's a great thing that the ethics board has chosen to provide guidance with respect to the city's gift ban, which is not itself very clear. However, I don't think it did a very good job. I'm a big fan of Philadelphia's ethics program, but this gift regulation is dreadful. Fortunately, it's just a proposal. There will be a hearing on November 20, hopefully followed by a rethink of the regulation.

There is usually another side of the coin, and that other side is often ignored in drafting a government ethics code. The other side of the nepotism coin came up recently in an ethics proceeding in Stamford, CT.

According to an article this week in the Stamford Advocate, a former finance board member filed an ethics complaint against a former colleague, who still sits on the finance board, for intervening to help a cousin, and member of her household (which in Stamford is considered "immediate family"), who is a city employee.

One piece of evidence provided by the complainant is that the respondent e-mailed the mayor after learning that the complainant, then a finance board member, was seeking to reorganize the department where the respondent's cousin worked, which might have meant the cousin losing her job. The e-mail included the following:
"It was like dandelions. You just accept them. They were there, something you've seen all your life."

Dandelions are a perfect metaphor for institutional corruption. In this case, the dandelions were extra payments (beyond those due to retirees) made by Detroit's two pension funds, to active employees (54%), retirees (14%), and the city itself (32%), the latter to lower annual contributions to the funds, according to a front-page article in today's New York Times. The extra payments totaled almost $2 billion over 23 years. The quote is from Detroit's former independent auditor general, Joseph Harris.

Why would pension boards hand out payments to active employees? May it have had something to do with the fact that the boards were controlled by government employee unions? Back in 2008, I wrote a blog post which dealt with this issue. The post talks about whose property a pension fund is:  that of the employees who will be paid from it or of the citizens whose money is being spent? In good times and when pension board trustees are acting responsibly, the citizens have little to lose. But in bad times and when pension board trustees are acting irresponsibly, not only is the citizens' money wasted, but they may find themselves paying extra money of their own.

There is a great deal of misunderstanding concerning the difference between a conflict of interest and a gift. It appears that most people consider them two completely different things. In fact, they represent two kinds of conflicts, pre-existing conflicts and conflicts that are created by an event. The confusion between the two characterizes a situation that led to an ethics complaint in Los Angeles.

According to an article on the KPCC public radio site, from January to May this year, a son of interim general manager of the Los Angeles Department of Building and Safety had a paid internship (while in law school) with the lead law firm representing the developer of a huge project known as the Millenium Towers. The complaint against the general manager characterized the issue as a conflict of interest, and two published reports of the matter do the same (but a comment does suggest it was a gift). However, the general manager was involved in the matter several months before his son was hired by the law firm. There was no pre-existing conflict or relationship, only the hiring of a family member after the law firm and general manager were already involved in the matter.

Five years ago, I wrote a blog post about gifts and reciprocity, based on a classic anthropological work, Lewis Hyde's The Gift. An op-ed piece in Friday's Washington Post by another anthropologist, Hugh Gusterson, extends this look at gifts by considering two kinds of gift:  those between equals and those that establish subordination.

Focusing on gifts to Virginia's governor from the owner of a pharmaceutical company, Gusterson notes that gifts to politicians from companies and wealthy individuals tend to establish subordination. He writes that "the governor can only return Williams’s generosity by lending him the power of his office in some way."

Gifts to a local official can fall between jurisdictional cracks, as shown in an article today in the New York Times. They can also fall between definitional cracks. And between these cracks it's gray.

The article reports that, a couple of years ago, Newark NJ's mayor, Cory Booker, who is running for U.S. Senate, was given money by several high-tech executives to found a high-tech company.

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