Scoppe: Pots and kettles and ethics law flaws

Associate EditorJune 19, 2012 

IF YOU’RE UPSET over the work Gov. Nikki Haley did for her employer while she was a House member, you ought to be livid over what Rep. Jim Merrill has been doing for his client.

Ms. Haley is under investigation by the House Ethics Committee over allegations that she engaged in illegal lobbying when, as a House member, she tried to convince her fellow lawmakers and DHEC officials to come to the aid of the hospital that was paying her salary.

Mr. Merrill was outed this month by “that little girl,” as our governor affectionately calls The Post and Courier’s Renee Dudley, for using the considerable clout he amassed as House Republican leader to deliver on the top legislative priority of the S.C. Realtors Association, whose political action committee paid him $158,000 for his political advertising services in 2008-2011 and more, not yet reported, this spring.

Mr. Merrill told Ms. Dudley that what he’s doing is legal. Like the governor, who makes the same claim about her work, he might well be right.

He insisted that “There’s nothing unethical about it whatsoever.” Like the governor, who makes the same claim about her work, he’s completely wrong.

As our politicians have seemed determined to remind us on a near-daily basis since the Center for Public Integrity said South Carolina’s inadequate laws made us more susceptible to political corruption than all but five other states, the fact that something is legal doesn’t make it right. The world of unethical behavior is far, far larger than the discrete set of actions forbidden by an ethics law — and especially South Carolina’s ethics law.

State law requires legislators to report any payments they receive from entities that hire lobbyists, known as “lobbyist’s principals.” Another law requires them to recuse themselves from voting on legislation that could benefit themselves or their employers more than the general public.

Mr. Merrill didn’t report the money he was paid by the Realtors, although they did. And far from recusing himself, he was the driving force behind a controversial bill that substantially reduced property taxes on commercial real estate. He tried to claim the moral high ground by distinguishing his work on behalf of the Realtors from Ms. Haley’s work on behalf of Lexington Medical Center, saying that “If you do something for the industry, that is dramatically different than saying I’m going to do work that’s going to benefit” a specific real estate agent.

Well, yes and no. State law does make that distinction, allowing a legislator who is, say, a real estate agent to vote on bills that benefit the entire real estate industry, but not on bills that benefit him more than the industry as a whole. So if Mr. Merrill worked for a real estate agent, or was one himself, he would have a point in saying what he did is very different from what Ms. Haley did.

But Mr. Merrill isn’t working for an individual real estate agent; he’s working on behalf of the entire industry. So from an ethical perspective, he’s no cleaner than the governor; in fact, I think what he’s doing is much worse, because he works for an organization whose sole purpose is to get the Legislature to pass laws it likes — and he’s writing those laws in his capacity as a legislator.

His legal defense is far more sound — and that’s because our ethics laws are so weak. He doesn’t work for the Realtors; he works for their PAC. Since the Realtors PAC doesn’t actually benefit from the legislation that benefits the Realtors, he doesn’t have to recuse himself; and since the PAC isn’t a lobbyist’s principle, he doesn’t have to report his income.

If you think that sounds like splitting hairs, you’re correct. If you think that sounds like the same legal distinction without a substantive difference that the governor has cited to justify her work for the hospital’s foundation, you’re also correct.

There is another part of the law that makes it illegal for legislators to get a job based on the fact that they are legislators. And here, again, we see similarities: The hospital created and gave to Ms. Haley a job for which she had no demonstrated qualifications. And The Post and Courier reported that Mr. Merrill “could name no current clients beyond those he has secured through his political connections.” Of course, as difficult as it is to believe otherwise, there’s nothing to actually prove that they were hired because they were legislators, and absent such proof, they’re not guilty.

Realtors CEO Nick Kremydas, by the way, is quite happy with his arrangement with Mr. Merrill. He told the newspaper that, owing to his influential role in the House, Mr. Merrill is quite good at helping determine which legislators would fall in line, and thus deserve the PAC’s support. “It only makes sense — if you’re going to be successful, you hire the experts that do the best job,” he said. “If you don’t have a seat at the table, then you’re on the menu.”

Mr. Merrill suggested that what he does is commonplace. Like the governor — whose attorney promised, shortly before the story about Mr. Merrill appeared, to release a list of legislators who do such things — he’s probably right that other legislators have undisclosed conflicts.

I suspect he overstates the pervasiveness of the problem, reflecting our human tendency to consider our own sins ubiquitous. But because we require our legislators to tell us so little, and have such limited definitions of conflicts of interest, we may never know for sure.

Ms. Scoppe can be reached at cscoppe@thestate.com or at (803) 771-8571.

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