The Hindu Business Line : Access to power provides influence

MR GEORGE Bush will be sworn in on January 20 for his second term of office as President of the US. The inaugural festivities will include several lunches and dinners in the days preceding the inauguration, the actual swearing-in function, and a parade.

The President and Vice-President will be present at some of these events and provide a golden opportunity for those who want to be seen with them. Thus, the committee seeking donations from corporations and individuals to finance the events has set up a tariff schedule and attendant benefits. For $250,000 (Rs 1.13 crore), you can get four seats to the swearing-in, 10 seats at the parade, two tickets at a lunch that will feature the President and the Vice-President, and 20 seats at dinners that will be taking place at three locations where the two leaders and their families will put in appearances. The Committee further assures you that all printed materials will list the names of these sponsors.

It is admirable that government funds are not being used to pay for these celebratory events and they are privately funded. Or is it? It is an uncomfortable question in democratic societies whether altruism or access to power motivates donations to political events. A donation of a small sum to the local politician helps him fight the election. It also gives me access to him if he is elected so I can then get my road paved or have the policy changed so it favours my company.

The Chinese have long acknowledged the importance of this access and call it guanxi. You take time to build guanxi and don't squander it easily. Democratic societies often worry that such influences cause bias and corruption in the decision-making process and unfairly tilts the balance in favour of the rich and powerful. But access and the corruption it entails seem to exist quite comfortably even in the most sophisticated and democratic societies — the US.

Insidious forms of how individuals and organisations seek access to power so as to be able to influence decisions can be seen in several areas. One area where we want the individuals to be free and fair is the judiciary. Most judges in the US get lifetime appointment so their jobs are secure and not subject to political whims for as long as they want to work.

One aspect of their functioning that has been bothering the public lately is the judges' attendance at seminars that are often seen as junkets. These seminars are funded by corporations presumably to offer the judges as opportunity to learn about new subjects on which they hear cases, and has been seen by many as influencing the perspective of the judges on contemporary issues. The seminars are fully funded, and often held in exotic locations such as hunting lodges or golfing resorts.

Formerly, judges were required to report the value of their trips but a judicial conduct committee recently revised its guidelines and dropped this requirement. The guidelines now do not prohibit a judge from attending a seminar that has funding from a sponsor who may have cases coming up before the judge. When a corporation spends the money conducting a seminar to educate the judges about, say, stem cell research and the legal implications of it, they are a step ahead even before their cases come to court.

It turns out that when some members of the academia speak up to promote their point of view on a matter of national policy, it is not necessarily an independent one. A company may be paying them directly to espouse that point of view in public, or may be compensating them indirectly by sponsoring a conference, or may be making a donation to the university. Thus, the various `talking heads,' as the experts who come on TV are called, may just be the public relations of some interest group. The expert wants to influence your opinion and that of the policy-makers without you realising the ulterior motive:

Influence peddling in the garb of expert opinion?

The National Institute of Health is a reputed government research agency that is also involved in monitoring the efficacy of drugs. Reports last year indicated that several top officials of this agency were also receiving attractive consulting contracts from the companies whose drugs they were said to be monitoring. The officials said they undertook the assignments with the permission of their superiors. So, perhaps, no one was violating rules but companies obviously valued the access to these officials and their influence in the organisation that their consulting contracts gave them access too. Do these payments affect the way they monitor the drugs for the public's benefit?

Lobbyists in the US are individuals and firms registered with the government as representatives of various interests such as business corporations and foreign governments. As their vocation suggests, they lobby the administration and members of Congress (parliament) for legislation and policies favourable to those they represent. There is nothing wrong with this in a democracy, but this obviously can lead to a lot of influence peddling and rules are laid down about acceptable and unacceptable behaviour.

For instance, rules specify the extent and nature of gifts and entertainment that is permissible. It was recently made known that one Congressman, Billy Tauzin, will step down from office and become the President of the Pharmaceutical Research and Manufacturers Association of America. This is the lobbying firm for many well-known drug companies. He was in Congress for 24 years before quitting. He was also most recently the main author of a new Medicare Drug Law which, critics claim, went along with the industry's specifications in many ways.

Press reports that his representative began negotiations for the new job only after the law was passed are perhaps meant to avoid any semblance of a quid pro quo. But are you convinced? Mr Tauzin will also be prohibited by the rules from directly lobbying his former colleagues for a year. But the rules do not prevent him from directing his assistants and associates in his new job about whom to contact in Congress for what.

sThe Boeing Company was severely embarrassed end of 2004 when a senior Pentagon official, Ms Darleen Druyun, who used to hand out large contracts to the company joined the firm as a Vice-President after her resignation from the government. Her daughter and son-in-law were employed by Boeing and she later admitted to negotiating her own position with the company while still with the government. She has pleaded guilty to violating conflict of interest laws and will serve time in jail. What is the fine line that separates the case of Ms Druyun from that of Mr Tauzin? An important feature of democracy is that individuals have a voice in their government. This is not just through the ballot at election time but also by requiring the people's representatives and the government to remain accessible to the people. Where the system deteriorates is when those who are able to purchase that access have a better chance at getting the decision they require.

Transparency International, in a recent survey, asked respondents in 64 countries if they have paid a bribe. I suspect that Cameroon fell to the shameful bottom of the list because larger numbers of householders there said `yes' remembering the payment made to the local policeman for running the red light. The US remained at the top of the rankings because while the respondents may not have paid the local labour inspector, neither were they the ones who contributed to the President's inauguration.

As the US pushes China to be more democratic, and helps Iraq make the transition to democratic systems, perhaps those nations should also be warned that the well-entrenched desire for access to power that thrives under autocratic systems also finds innovative ways to survive under democracies.

(The author is a professor of international business and strategic management at Suffolk University, Boston, US. His Internet address is cgopinat@suffolk.edu)

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