- The Washington Times - Monday, January 26, 2009




President Obama’s hand that was raised to take the historical oath of office came down hard on lobbyists during his first full hours in the Oval Office. Facing a limping economy, the newly installed commander in chief froze senior staffers’ pay and executed stricter restraints on relationships between federal lobbyists and his administration in an ode to public service’s original objectives. Those are admirable moves and send the right message that he’s ready to lead by example. However, even though this is the right message, is it really form over substance? Most Americans would agree that there are more pressing issues concerning the economy and national defense that should be addressed first.

Intending to stop lobbyists from utilizing public service to climb the corporate ladder, President Obama restricted his new White House staffers from working with issues they had previously lobbied for, as well as curb individuals from interacting with the Obama administration if they leave the White House and return to the advocacy world. But let’s take this to its next logical level.

Who best understands the oil industry, the media industry and the securities industry? An academic who studies the industry or a well regarded successful industry participant? An academic may be very knowledgeable about an industry but his experience of the industry is usually vicarious, and his views are primarily scrutinized by academics in esoteric academic journals. If he is wrong, he is criticized by his peers. (He cannot lose his job because he probably has tenure.) An industry participant, on the other hand, has his views scrutinized by the marketplace. If he is wrong, he loses his job or a lot of money.

Conflict of interest rules that discourage well regarded successful industry participants from becoming part of the government do a disservice to this country. It means the people who know the most about how the industry really works and who know the key participants in the industry will not be working for the government.

Conflict of interest rules that prohibit people leaving government service from participating in the industries they regulate discourage smart young people from joining government service. It does not give them the opportunity to invest in their early careers by taking low-paying government jobs and then leveraging that experience to get well-paying private sector jobs in the industry they know the best.

Conflict of interest rules that prohibit or restrict lobbyists with extensive knowledge about their client’s industry from having direct access to government decision makers makes the transfer of knowledge to the government inefficient and cumbersome at best. In our judicial system, we recognize that having legal counsel representing both sides of a dispute tends to result in all the relevant issues being presented before the judge and jury. Shouldn’t the politicians, regulators and bureaucrats have the same benefit of hearing all sides of an issue when trying to legislate, regulate and administer? Conflict of interest is a concept with a large gray area between what is right and wrong. There are obvious conflicts of interest such as offering and accepting bribes, which nobody condones (unless you happen to operate in certain Third World economies where bribery is the custom). However, a lobbyist picking up a lunch tab where he is discussing the dynamics of an industry and the fate of certain regulations with politicians, regulators or bureaucrats is in this gray area. I would suspect (or should I say hope) that most of our government servants would not have their judgments impaired by a $50 lunch.

While placing fetters on lobbyists looks good in the papers, the growing industry cannot simply be expunged with a signature. As the government inflates - an action seemingly propelled with the new administration’s agenda - lobbyists’ role in public policy promises only to continue to increase, not diminish either in size or power.

Take the economic stimulus, for instance. The billions of dollars available offer plenty of opportunities to fill the hands of those in need. As a result, companies and groups hire their own advocates to extend a hand for their cause, offering valid arguments about their clients’ need for a serving of the economic recovery porridge.

The yawning growth of the State helped turn lobbying into the $2.4 billion industry we know today. If President Obama would like to truly rein in special interest influence, his administration might want to focus on the root causes of special interests’ viral ways by putting pressure on the reduction of the government leviathan.

This is not to say that conflict of interest rules and restrictions that apply to lobbyists, politicians and public servants are unnecessary. But should these rules and restrictions be an early priority of the Obama administration when we have more pressing issues? The problems with our nation’s economy and government today are not the result of abuses of conflict of interest rules that have to be corrected. We should not throw up the smoke screen of solving minor conflicts of interest issues when we have major substantive issues to solve. Let’s deal with the nation’s substantive issues first.

Armstrong Williams’ column for The Washington Times appears each Monday.

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