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Lawrence Glazer

Lawrence M. Glazer

Corrupt? Michigan?

January 19, 2017

How clean are the three branches of Michigan’s state government? Are they relatively spotless, or relatively corrupt?  Unsurprisingly, it depends on who you ask, which in turn depends upon how they define “corrupt”.  I could find only two major studies of state government corruption in recent years.

Oddly, both relied on journalists’ opinions for the data.

In a 2014 research project, Orgzhan Dincer and Michael Johnston of Harvard University, found it useful to distinguish what they called “legal corruption” from “illegal corruption”:

“We define illegal corruption as the private gains in the form of cash or gifts by a government official, in exchange for providing specific benefits to private individuals or groups. It is the form of corruption that attracts a great deal of public attention. A second form of corruption, however, is becoming more and more common in the U.S.

We define legal corruption as the political gains in the form of campaign contributions or endorsements by a government official, in exchange for providing specific benefits to private individuals or groups, be it by explicit or implicit understanding.”

A couple of hypothetical examples may help to clarify the distinction:

Let’s say a bill has passed both houses of the Michigan legislature and Governor Goodenough has not made up his mind whether to sign it into law or to veto it. Businessman Joe Dokes, whose business will benefit if the bill is signed into law, seeks a private meeting with the Governor. At the meeting Dokes hands the Governor an envelope containing $3,000 in cash, with the explicit understanding that, in return for the payoff, the Governor will sign the bill. And the Governor does sign the bill into law.  This is a classic example of “illegal corruption”. It would be a crime in every U.S. Jurisdiction, state or federal.

“Legal corruption” is a lot more subtle.

Let’s say that the legislature has passed a bill that would be harmful to Joe Doakes’s business. Everyone with an interest understands this, and the trade association for that business has urged the Governor to veto the bill. The Governor is in a tight race for re-election, and has asked the trade association for a special favor: A large contribution to pay for the making and wide broadcasting of a negative political ad against the Governor’s opponent, Sarah Spotless. However, there is one problem. Public knowledge of such a large contribution, followed by a gubernatorial veto of the bill, would make the Governor look bad and hurt his re-election chances.

Ah, but there’s a way.  As I wrote in a previous Dome column:

“The 1976 Michigan Campaign Finance Act requires that all political expenditures be reported to the Secretary of State. Section 6(1)(a) of the Act defines a political ‘expenditure’ as any payment for goods or services ‘for purposes of influencing the nomination or election of a candidate.’”*

This would seem to be pretty inclusive.  However, sub-section (2)(b) creates an exception if the expenditure is ‘for communication on a subject or issue if the communication does not support or oppose a ballot question or candidate by name or clear inference.’” 

Thus the trade association can create a phony “social welfare organization” whose sole function is to pay for ads attacking candidate Spotless without ever revealing who financed the ads. The only requirement is that the ads not expressly urge a vote against her. These so-called “issue ads” can use phrases such as “call Sarah Spotless and tell her to stop attacking Michigan families”; as long as the ad does not expressly urge the viewer to vote for or against a specific candidate, the Michigan law doesn’t see it as a “political expenditure” and therefore does not require that it be publicly reported.  So the trade association can pay for the attack ads to assist Gov. Goodenough’s re-election campaign and nobody will ever know. That’s “legal corruption”.

In the Harvard study Dincer and Johnston polled reporters who regularly covered state govenment, asking them to rank each branch of their state’s government from 1 (corruption is “not at all common”) to 5 (corruption is “extremely common”). The researchers then used the results to gather the various states into groups (rather than ranking states individually). For Michigan the results were pretty favorable:

Michigan Executive branch: Illegal corruption 1, legal corruption 1

Michigan Legislative branch: Illegal corruption 2, legal corruption 2

Michigan Judicial branch: Illegal corruption 1, legal corruption 1

———–

In 2015 an organization called the Center for Public Integrity did a study that attempted to measure “not corruption itself”, but “key indicators of transparency and accountability”. It was an interesting concept; you can’t measure corruption directly, because it always takes place in secret, so you measure instead the obstacles to corruption each state has in place, as a sort of proxy.

The Center said that it asked experienced journalists to grade each state on 245 specific criteria: 

“Each state received a report card with letter grades in 13 categories, including access to information, political finance, electoral oversight, executive accountability, legislative accountability, judicial accountability, state budget processes, civil service oversight, internal auditing, procurement, ethics oversight, lobbying regulations, and management of state pension funds.”

The result: every state was found wanting. The highest grade, awarded to only three states, was “C”.  The state with the highest (best) numerical score was Alaska.   Eleven states received a grade of “F” (for “fail”). 

And the lowest numerical score of all was awarded to—wait for it—Michigan.

So, to recap, the Harvard study found that Michigan was very clean as to “illegal” corruption (i.e., direct bribes) and pretty clean as to “legal” corruption.  The Center for Public Integrity reviewed measures taken by the states to, in effect, prevent legal corruption, and found that Michigan was the worst state of all.

So who’s right?

My observations, for what they are worth after nearly fifty years as a participant or writer on Michigan state government, are these:

“Illegal corruption” is very low in all three Michigan branches of government. Yes, there are occasional cases and I’ll tell you the story behind a major one in a future column.

“Legal corruption” in the executive branch is pretty low, partly because there are only a small number of elected officials and political appointees. The great majority of executive branch employees are civil servants, who have little interest in legal corruption’s coin of the realm: Campaign contributions and “issue” ads.

As to “legal corruption” in the judiciary, I question whether it even applies, because this branch is very different from the other two.

First, there are strict, enforceable prohibitions against any communication with a judge by a lawyer or party to a case outside the knowledge of the opposing lawyer or party. Second, there are tight restrictions on when and how campaign funds can be raised, and judicial candidates have to give up any funds remaining after the election (unlike officials in the other two branches). Third, decisions of all judges of District, Probate, Circuit and Court of Appeals (i.e., all but the Supreme Court) are subject to appeal to a higher court. No matter how grateful a judge may be for a lawyer’s campaign contribution, if the judge bends the rule in favor of that lawyer, there’s a reasonable chance that he or she will be reversed by a higher court.

Which gets us to “legal corruption” in the legislature: How bad is it?

In 2013 the State Bar of Michigan—embarrassed at how much “dark money” was being poured into Michigan Supreme Court elections, petitioned Secretary of State Ruth Johnson to re-interpret the Michigan Campaign Finance Act. Johnson, a Republican, decided that this statute could, and should, be reinterpreted. She announced that her office would promulgate a new set of administrative rules requiring all political ads, including “issue ads”, to disclose who financed them.

The Republicans controlled both houses of the legislature.

The Senate Committee on Local Government and Elections was already meeting to consider amendments to the Campaign Finance Act. The moment they learned of Johnson’s announced intention to prohibit anonymous financing of “issue ads”, they recessed the hearing. When they resumed, the first order of business was amending the bill to expressly protect the anonymity of donors, which would prevent the Secretary of State from reinterpreting the Act. The amended bill sailed through the legislature on a party line vote (a few Republicans did join all Democrats in voting against the bill).

Michigan governor Rick Snyder signed the bill into law.

The result: During the next election cycle (2014), according to Detroit Free Press editor Stephen Henderson, “A record $42.5 million was spent on issue ads in the state during the 2014 election by groups that didn’t report who their contributors were.”

* Domemagazine.com, July 19, 2013

Lawrence M. Glazer is the author of Wounded Warrior, a recently published biography of former governor and Supreme Court justice John Swainson. He is also a retired Ingham County Circuit Court Judge and former legal advisor to Gov. James J. Blanchard.

January 22, 2018 · Filed under Glazer

2 responses so far ↓

  • 1 Richard // Jan 23, 2018 at 10:19 am

    Far lower on the Totem Pole is still another important exclusion: The $1000 threshold waiver for candidate spending that carries with it non-required reporting.

    ALL campaign dollars – incoming and outgoing – should be required to be reported on the same schedule as all candidates. The $1000 waiver is a joke in some communities.

  • 2 Frank Walshingham // Jan 26, 2018 at 6:46 pm

    Brian Banks, Jase Bolger, Todd Courser, Cindy Gamrat, Davis Jaye, Henry Stallings, Virgil Smith, Andy Dillon… many crooked and shady Michigan legislators in recent memory. Though multiitime felon Brian Banks has to take the cake as the biggest criminal!


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