“In 2016, JPMorgan Chase agreed to pay $264 million as part of a settlement with the federal government. The reason? An Asian subsidiary of the company had hired the children of Chinese government officials in the hopes of currying favor with their powerful parents — a violation of the Foreign Corrupt Practices Act.
Had the same thing happened with a foreign company and an American politician’s family, however, no violation would have occurred — because no equivalent American law prevents a foreign company or government from hiring the family members of American politicians.
This glaring loophole provides political families with an opportunity to effectively “offshore” corruption and cronyism. It gives the politically connected class enormously tempting opportunities for self-dealing, the sort of thing that is blatantly illegal in almost any other context.
Consider two Washington power families: the Bidens and the McConnell-Chaos.
As vice president, Joe Biden served as point person on American policy toward China and Ukraine. In both instances, his son Hunter, a businessman, landed deals he was apparently unqualified to score save for one thing: his father.”
David Lindsay: I don’t like a lot of red tape, but
“The problem more broadly is that we rely on a hodgepodge of laws that lack the clarity and bright ethical lines found in the Foreign Corrupt Practices Act. That needs to change. International bribery laws clearly state that if a person or entity pays a politician’s family member and gets favors in return, it’s an act of bribery; it’s no different from the politician taking the money himself.
Obviously, the immediate family members of high-ranking politicians have to work — no one is saying otherwise. But given their unparalleled access, they should also be required to be transparent about what they are doing.
At a minimum, we need to strengthen American disclosure rules. Joe Biden and Elaine Chao have to report when someone sends them a $500 campaign donation, or when they make a $5,000 investment in a stock. But when their family members strike lucrative deals with a foreign government or oligarch, the reporting requirements are vague. The personal financial disclosure rules for American public officials should be expanded to include details concerning all their immediate family members (and not just their spouses, as the law currently states), and any dealings with foreign governments.”
All this sounds good, but it makes me nervous. It has to be administered carefully, or it becomes a brake on decent people, while crooks just ignore or game the rules.