Cronyism and Ethics

Anonymous

Wed, 02/24/2010 - 06:38

Business Associates

This month, in Portland, CT, home of the stone used to build New York City's
brownstones, the new ethics commission found that it was a violation of
the town's ethics code for the board of selectmen (the town's management board) to hire attorneys who had given campaign
contributions to the board of selectmen majority's party town committee,
according to <a href="http://www.portlandct.org/pdf/minutes/2010/ethics02-09-10.pdf" target="”_blank”">the
EC's minutes</a>. The contributions of the particular attorneys were
$20-250. 
 
Cronyism is a tough problem to deal with. First, it's hard to define
and, therefore, to enforce. Second, it's not clear that government
ethics is the right place to deal with cronyism. Third, it's
questionable whether most instances of cronyism create an appearance of
impropriety so much as create an opportunity for personal and political
attack.

Definition 
<a href="http://en.wikipedia.org/wiki/Cronyism" target="”_blank”">Wikipedia defines
cronyism</a> as "Partiality to long-standing friends, especially by
appointing them to positions of authority, regardless of their
qualifications." This is a pretty good definition, although I would
change "friends" to "family and friends, and others' family and
friends." Nepotism is hiring one's own family, which is easy to deal
with. Cronyism often involves officials' hiring the families of
colleagues, political and business connections, and friends. 
 
Oakland, CA actually has an anti-nepotism and -cronyism ordinance, the
only one I could find. It defines cronyism as "participating in any employment decision that
may be viewed as a conflict of interest, such as one involving a close
friend, a business partner, and/or professional, political, or
commercial relationship, that would lead to preferential treatment or
compromise the appearance of fairness." 
 
This is an excellent definition except for the first phrase,
"participating in any employment decision," unless that phrase is
loosely interpreted to include, for example, handing your son's resume to a colleague. 
 
The actual provision creates a different approach to cronyism than to nepotism. Here's §2.40.060 (Title 2, Ch.
2.40 of the <a href="http://library.municode.com/index.aspx?clientId=16308&stateId=5&stateNa…; target="”_blank”">Oakland
Municipal Code</a>): 
<ul>
No official, manager or employee
may engage in cronyism and/or attempt to influence the City or any
official, manager or employee, to hire, promote, or change the terms
and conditions of employment of any individual with whom that person
has a family relationship, consensual romantic relationship or
cohabitant relationship. 
</ul>
For cronies, it is only a violation to participate in an employment decision, whereas for relatives, it is a violation to attempt to influence, which is much broader. The
relationships that must be disclosed include only family and
lover. The term "cronyism" is not used in any other provision of this
ordinance. 
 
However, some of the relationships are too vague to enforce in most
instances: close friend? political or commercial relationship?
And here's the ordinance's feeble attempt to define "Consensual romantic relationship": "any
consensual sexual or romantic relationship." That's all, folks. Can you imagine an ethics commission asking for evidence of how sexual or romantic a relationship was at the time of the alleged violation? 
 
Whatever the problems with this provision, the mess with Marion Barry in the
District of Columbia shows that giving a contract to a lover can cause
serious problems. 
 
But the problem isn't just showing preferential treatment. There is
also the problem of giving a job or contract to someone who is
unqualified. In fact, that is the part that is most damaging to the
public, because incompetence can be very expensive. If your brother
happens to a Bobby Kennedy, maybe making him city attorney wouldn't be
bad for the city. But again, how are you going to define competence in
an ethics code? 
 
How does cronyism differ from patronage? One aspect of cronyism is a
subcategory of patronage, the part that shows favoritism to
political supporters. But there's a lot more to cronyism than that, and a lot more to patronage, which equally involves hiring people with the
stated or unstated requirement that they will work to get you re-elected.
Patronage is intended to create a political machine, not just for
officials to help family and friends, as well as rub each other's backs. 
 
EC Enforcement 
The Portland EC's decision is only one reason why an EC enforcement is
not the right way to deal with cronyism. Since it's indicative of the
wrong way to interpret an ethics code, however, I think it's worth a look. 
 
<a href="http://www.portlandct.org/pdf/minutes/2010/ethics02-09-10.pdf" target="”_blank”">The
decision</a> was based on two <a href="http://www.portlandct.org/pdf/EthicsCodeOrd020608.pdf" target="”_blank”">ethics
code</a> provisions: 
<ul>
§1-1(b) (b) Town representatives have a responsibility to act with
integrity, avoiding any behavior, lawful or unlawful, which could call
the integrity of Town government into question. 
 
§1-7(b) No Town representative shall seek or knowingly accept any
personal benefit where the benefit is intended to influence the
representative in the performance or nonperformance of any official
duty. 
</ul>
The first provision is part of the introductory Declaration of Policy.
Policy statements should not be enforced. Period. Portland is far from
the first EC to do this, however. 
 
The second provision is triply inapplicable. One, no personal benefit
was obtained; the contributions were made to the party committee, and
there is no evidence that the money was even given to the selectmen's
races, since much of the committee funds are given to state and federal
races. Two, an intent to influence has to be proven, and there is no
evidence of that. Three, it is common, and highly recommended, to
exclude legal campaign contributions from the definition of financial
benefit. 
 
According to <a href="http://www.middletownpress.com/articles/2010/02/23/news/doc4b8348937d28…; target="”_blank”">an
article in yesterday's Middletown Press</a>, the Portland board of
selectmen discussed the EC decision at their meeting this week, but it
doesn't appear that these problems with it were central, although the
issues of intent and inclusion of campaign contributions were raised.
What bothered the first selectman was that "the finding throws
into question the selectmen’s ability to make appointments or sign
agreements with businesses in town," and that the EC is usurping the
selectmen's power to appoint. Another selectwoman was upset at being
told she had acted "unethically." 
 
Cronyism Enforcement 
What was not said in Portland, or in the Oakland ordinance, is that
cronyism comes in two sorts and two flavors. The two sorts are hiring
and contracting. The two flavors are competent people with connections
and incompetent people with connections. 
 
When it comes to competence, ethics codes can define, guide, and prohibit, but they cannot set
standards, require tests, monitor, or set up procurement systems. These
are the work of personnel and procurement rules, practices, and
departments. 
 
Personnel and procurement rules and practices can limit hiring and contracting with incompetent people, the
cronies most damaging to the public interest, those who create waste
and can get the local government into serious trouble. Fortunately,
these are also the cronies most people find most objectionable. 
 
Personnel and procurement rules and practices can also prevent the sort
of favoritism that leads to more expensive contracts, even where the
contractor might be perfectly competent. Good procurement practices,
including competitive bidding and the exclusion of contractors from the
process of writing specifications, take the opportunity for favoritism
away from elected and other top officials. 
 
On the other hand, personnel and procurement rules and practices do not
normally ensure that hirees and contractors are not connected somehow.
They don't check political, business, organization, or family
connections, especially to those who have no role in the particular
department or agency. They also do not deal with professional hiring,
such as lawyers, or political positions, such as aides and advisers. This is the hard part of cronyism to enforce. So long as the hiring of qualified cronies is not politically damaging, the only limit on it is a local government's ethical environment, especially its ethical leadership. 
 
See the unsuccessful U.S. House <a href="http://www.govtrack.us/congress/billtext.xpd?bill=h109-3925" target="”_blank”">Anti-Cronyism
and Public Safety Bill</a> of 2005 for an approach to a very specific sort of cronyism that focuses on
qualifications rather than relationships. 
 
Zoning is another area where a great deal of favoritism is shown. This
is why zoning decisions should be made as independent as possible from
elected and other top officials. 
 
Impropriety or Politics? 
When it comes to talking about cronyism in local politics, the term is
rarely defined, and enforcement options are rarely discussed. Instead,
talk about cronyism usually takes the form of personal and political
attack. So-and-so has hired a political backer, a party committee
officer's son, the sister of a colleague's business partner. 
 
Sometimes emphasis is put on the hiree's credentials, but this isn't
required. Nor is it required to show how the rules could be changed to
prevent this from happening in the future. Why? Because in the future
the accuser might be in power, and those rules could cramp his style. 
 
This is why an ethics commission can have an important role in the
development of ways to combat cronyism. Just because such ways do not
belong in an ethics code does not mean that an ethics commission,
especially when faced with complaints that involve cronyism, cannot
make recommendations to the local government's governing body, or a
charter review commission, to institute hiring, procurement, and zoning
practices that will create serious obstacles to cronyism. 
 
Robert Wechsler 
Director of Research-Retired, City Ethics 
 
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