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On Ethics Reform, Loopholes, and What We Can Learn from Meds

By Sarah Laskow
Wednesday, March 9th, 2011
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Eliot Spitzer

Does it matter if, in Albany, legislators receive gifts from lobbyists and how much those gifts are worth? This problem is a small knot in the vast net of ethical questions that’s snared the capital and its inhabitants. But each time a legislator or an ethics commissioner tries to untangle it, someone else with an interest in the question is pulling it tight from the other end.

Once Albany was a place where legislators could collect goodies from lobbyists without much hesitation. The gifts they received were not necessarily big ticket items: In some states, it’s legal for government officials and legislators to receive gifts with price tags running into the hundreds, even thousands of dollars, as long as they report them. In New York, up until 2006, legislators could only receive gifts from lobbyists worth less than $75. But they could receive as many as they wanted, which means that a lobbyist could fund an afternoon of golf, a significant round of drinks, a lavish dinner, and late-night round of bowling (or whatever it is people got up to after hours) without breaking any rules.

But in 2006, that changed when the Lobbying Commission, then one of three Albany institutions charged with overseeing the capital’s ethical behavior, interpreted the relevant restriction to mean that lobbyists could only give legislators $75 worth of gifts, in total, each year. The Ethics Commission, which policed the executive branch, already adhered to this interpretation of the law. The Legislative Ethics Commission stuck to the old, more permissive definition, even though legislators’ leeway to accept an infinite number of $75 gifts was moot once lobbyists were barred from that sort of gift-giving.

In 2007, former Gov. Eliot Spitzer’s ethics reform changed the system altogether. “Gifts” legally could not exceed “nominal value,” although the law included a handful of exceptions to that rule, including, notably, tickets, food, and beverages at “widely attended” events.

In most capitals, when the legislative and executive branches agree to crack down on egregious gift giving, the new status quo quickly emerges and stands. Everyone figures out the loopholes — under the federal government’s “toothpick rule,” for instance, which restricts lobbyists from giving lawmakers any nourishment other than finger food, caviar on a cracker or blini is acceptable — and life and lawmaking go on. But not in Albany.

In addition to shrinking down the legal limit for gift-giving, the Spitzer-era reforms merged two of Albany’s three ethics watchdogs. But the city still must report to the Commission on Public Integrity and the Legislative Ethics Commission.

Ethics reform in Albany has dragged on for about a decade at this point: legislators were trying to tamp down gift laws in Albany as early as 2000. This next iteration provides yet another opportunity to tinker with the gift laws, to reinterpret, perhaps, as the Daily News reported last week, “nominal value” as “ten dollars” and to re-evaluate rules that keep legislators and lobbyists from fraternizing at anything other than “widely attended events.”

To a certain extent, at this point, these definitions are just a matter of convenience for everyone involved. Nothing as exciting as tickets to the Super Bowl is at stake here; it’s just a question of what lobbyists and legislators consume when they meet, as they inevitably will.

“The amount doesn’t really matter, if you’re talking about an amount that small,” said Caitlin Ginley, a reporter (and former colleague) at the Center for Public Integrity, who covers issues of state ethics across the country. “It’s more about access than it is about the money. If a lobbyist is taking a lawmaker out for lunch, it doesn’t matter if it’s a cup of coffee or a sandwich. It’s about the face time, out of the public eye.”

Changes to the rules governing events could have a bigger impact, though. The issue here arises, as with the old, $75 rule, from conflicting interpretations of ethics laws by Albany’s ethics watchdogs. (For the record, most other states do not have this problem; although the work of ethics oversight may be split among different governmental bodies, generally only one has the power to interpret the laws that govern the behavior of the participants.) In this case, the Commission on Public Integrity has, for all intents and purposes, banned lobbyists from holding receptions, no matter how widely attended they might be. The Legislative Ethics Commission, on the other hand, thinks those sorts of events are fine.

In the new law, Blair Horner of NYPIRG explains, the legislature could “reconcile those competing interpretations of the law. It could either be not much of a big deal — or a big deal. If lobbyists are allowed to have lavish receptions in private with elected officials, I’d have a problem with that.”

If Albany lobbyists are fed up with this sort of back and forth regulating their behavior, they might want to look outside of the field for a path forward. Outside of government, there’s another industry that grappled with the ethical propriety of business-seekers giving gifts to business-givers. In the medical community, it was common for years for representatives of drug companies to take doctors out to fancy dinners and deliver gifts both of large and nominal value.

In 2008, however, under the leadership of former legislator, now lobbyist, Billy Tauzin, PhrMA, the drug companies’ trade and lobbying organization, decided with its members to unilaterally end the practice of gift-giving altogether.

“We are also concerned that our interactions with healthcare professionals not be perceived as inappropriate by patients or the public at large,” the group’s Code of Ethics states. It still permits “modest, occasional meals” but  prohibits gifts items of even “minimal value,” which includes the branded “pens, note pads, mugs,” and so forth that used to pepper doctors’ offices. This code may give the drug reps fewer opportunities to schmooze with their customers, but at least they’re the ones who control its terms.


  • HughCTaylor

    Amusing way you state this… How about Phrma and Tauzin shrewdly preempted a growing advocacy movement to have government regulate their legal bribery of doctors. That movement, spearheaded by leading academic doctors with high profile articles in leading journals, had just succeeded in winning a model code banning Phrma reps from medical schools and calling for No Free Lunches. Pharma was smart, and they realized they got just as much value from free samples — which they still provide — as free lunches.