United States: Representative Introduces House Version Of Senator Warren's Anti-Corruption Bill

Last Updated: November 30 2018
Article by Steven D. Lofchie

Most Read Contributor in United States, December 2018

U.S. House Representative Pramila Jayapal (D-WA) introduced companion legislation to Senator Elizabeth Warren's (D-MA) wide-ranging Senate "Anti-Corruption" bill (see previous coverage). The purpose of the Act is to eliminate the "dominance of money in federal decisions."

The Anti-Corruption and Public Integrity Act would, among other things:

  • require the majority of executive branch employees to recuse themselves from all matters that might provide financial benefits personally, or to a previous employer or client from the prior four years;
  • bar current lobbyists from taking government jobs for two years after lobbying (and for six years for corporate lobbyists);
  • prohibit "corporate outlaws" from assuming government positions by blocking the hiring of top corporate leaders whose companies violated federal law in the past six years;
  • block a federal contract and licensee employee from working at the agency issuing the contract of license for four years;
  • disallow "Golden Parachutes" that give corporate bonuses to executives for federal service;
  • mandate studies presenting conflicts of interest to be examined by "independent peer review" when being considered in the rulemaking process;
  • "restrict negotiated rulemaking" to prevent an "industry from delaying or dominating the rulemaking process" by ending the practice of inviting industry participants to negotiate the rules they must follow;
  • ban "informal review," establish a maximum 45-day review period, and block closed-door industry lobbying at the White House Office of Information and Regulatory Affairs;
  • allow only Appeals Court judges and not individual District Court judges to block agencies from implementing final rules;
  • permit the use of litigation to delay the implementation of final rules;
  • prohibit courts from considering "sham studies and research excluded by agencies from the rulemaking process";
  • reverse the Congressional Review Act provision banning agencies from "implementing the will of Congress based on Congress' prior disapproval of a different, narrow rule on a similar topic";
  • ban American lobbyists from receiving money from foreign governments, foreign individuals, and foreign companies for affecting U.S. public policy;
  • increase Congressional staff salaries;
  • allow "private lawsuits from members of the public to hold agencies accountable for failing to complete rules or enforce the law";
  • bar individual stock ownership by federal judges, expand rules prohibiting judges from receiving gifts, and mandate ethical behavior by the Supreme Court; and
  • establish the U.S. Office of Public Integrity, which will (i) "absorb the U.S. Office of Government Ethics" and (ii) "consolidate anti-corruption and public integrity oversight over federal officials."

Commentary / Steven Lofchie

There are a number of threads that have run through many of Senator Warren's legislative efforts, but two of the most common are (i) her determination to increase the power of government regulators against private interests (see Senator Warren Introduces Bill to Require That Large Companies Create a General Public Benefit) and (ii) her attempts to suppress, rather than engage with, viewpoints that are contrary to her own (see see CFTC Commissioner Giancarlo Withdraws EEMAC Report on Position Limits; Senator Warren Argues Regulatory Scales "Tilted" by "Undue Industry Influence"; Senator Warren Asks CFTC to Withdraw EEMAC Report on Position Limits; Senators Introduce Legislation to Limit FRB's Lending Authority. While the Warren bill and its House companion are styled as being "anti-corruption," the likely effect would be to (i) ensure that persons with significant experience in private enterprise cannot go into government and (ii) reinforce a revolving door between academics and government. Beyond that, the bill would maximize the authority of government regulators to go beyond the meaning of legislation in adopting rules.

The Revolving Door

Under the legislation, a former employee of a business that was awarded a "federal contract or license" may not be an employee of the executive agency that awarded the contract. The terms "contract" and "license" are undefined, but it could be read as including any federally-registered or federally-licensed financial entity. Leaving aside the question of whether it includes all regulated financial entities, or only some substantial subset, the bill would exclude from government a very significant number of smart, able and honest individuals with relevant experience.

The bill would also prohibit any agency employee from using the employee's official position to influence any matter, including any "rulemaking," that the employee knows is likely to have a "direct and predictable effect" on the financial interest of any person for whom the employee had served in the past four years as an employee or outside agent. That would seem to bar almost anyone, certainly any lawyer, with relevant experience from taking a policy position with the government.

So who may take government jobs? Academics, since they are not subject to the conflicts bans. One of the premises on which Senator Warren's proposal is based is that those in academics are above bias and are free from personal pressures. That faith in academes seems entirely questionable. Academics are subject to all kinds of pressure: to obtain tenure, to obtain grants, to obtain invitations to testify before Congressional committees.

Food for Thought: Considering Alternatives

The opposite of Senator Warren's approach might start with challenging underlying assumptions. Instead of barring those with private world experience from serving the government, an alternative bill might require those who would regulate to have experience being regulated. For example, legislation might be drawn to require that anyone who wished to serve in a government agency as a senior official must have at least five years of experience working in the relevant industry. An opposing approach may hold academics to the same standards that Senator Warren would apply to those who work in the private world. Alternative legislation might prohibit a professor from accepting a government agency job for at least four years following leaving academics if the professor's employer had received any federal contract or license, or had received any grant from a foreign government.

No one is proposing such alternatives, but given the choice between it and the Senator's "Anti-Corruption" proposal, the former would be more practical and more consistent with the American ethic (that we are nations of doers; that we do not wish to enshrine a ruling elite of government officials and academics).

Governmental Power

(1) The proposed Anti-Corruption bill provides that on any area where a statute is "silent or ambiguous," subject to procedural conditions, " a reviewing court shall defer to the agency's reasonable or permissible interpretation of that statute." In effect, the proposed bill would legislate the so-called "Chevron deference" which moves substantial authority from the courts (which are deprived of the authority to review regulatory action) and the legislature (which yields all benefit of the doubt on any area where the legislation is "silent" or ambiguous) to the Executive branch. This provision of the Act seems of dubious constitutionality: what would give the regulators the authority to impose their views where a law is silent?

(2) With respect to cost-benefit analysis, the bill requires agencies to (i) take account of benefits to the public, including "non quantifiable benefits" and (ii) adopt regulations that "prioritizes benefits to the public, including nonquantifiable benefits." What does that mean? Isn't the whole idea of a cost benefit analysis to compare costs and benefits? If one "prioritizes" benefits, does that mean ignore costs?

The "Anti-Corruption" bill is nearly 300 pages. While there may be some reasonable provisions in the bill, significant parts of it seem likely to suppress discussion, to deprive the government of experienced workers, and to establish a revolving door between government and academics.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Topics
 
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions