IT WAS A classic example of a powerful legislator using that power to get special favors for a business he owns, and as calls began two years ago for a criminal probe of corruption allegations concerning then-House Speaker Bobby Harrell, it seemed like the smokiest gun:
In 2006, Mr. Harrell’s Palmetto State Pharmaceuticals applied for a state permit to repackage prescription drugs to sell to doctors, who would then sell them to patients, at a profit. If that sounds like a great way to make medicine more expensive, by injecting another middle man and by encouraging doctors to prescribe more drugs than they need to, I agree, but that’s not the point of this story.
The point is this: The application arrived in an envelope marked “Office of the Speaker,” and was accompanied by a note written on official speaker’s office letterhead that said, “We would appreciate your urgent attention to this request. Bobby Harrell.”
The application said the business intended to open in 13 days, even though the Board of Pharmacy requires that applications be received at least 45 days in advance, and so what followed was a rush job: A board employee forwarded the application with a handwritten note that said: “It needs to be done ASAP … per Mr. Bryant because this is the speaker of the house.” Randall Bryant was the deputy director of the Department of Labor, Licensing and Regulations, the umbrella agency that staffs the pharmacy board.
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Emails were exchanged between staffers suggesting that the speaker and his staff were upset that it was taking so long to process the permit, and at one point Mr. Harrell summoned two employees to his legislative office for a meeting, while a member of the governing board participated by phone. One of the staffers later told SLED investigators that she had never before participated in a face-to-face meeting with a business owner and that it was “unusual”; the board member wrote to his fellow board members to warn of his concerns over the situation, noting that Mr. Harrell and his House chief of staff were upset when they were told that the company would need a repackaging permit from the U.S. Food and Drug Administration.
Mr. Harrell’s business got its permit, and a year later the speaker met with the director of the state Department of Health and Human Services to ask her to act quickly to allow a Medicaid insurer to use his company. Three years after that, he sent a letter to hospitals suggesting that they hire his company to dispense prescriptions to emergency room patients. An official with the state Pharmacy Association wrote to fellow pharmacists that when he told the speaker state law didn’t allow this, Mr. Harrell told him he would just change the law if that was the case.
The proof problem
It’s hard to even count the things that Mr. Harrell did for his company that runs afoul of the state law that prohibits legislators using their positions for personal financial benefit. Yet he was never charged with any crimes related to to this matter. Not because his actions weren’t clearly corrupt — they were — but because of this truth: The most corrupt things that politicians do are nearly impossible to prove in court — particularly when those politicians are powerful. And this one: The smartest politicians never apply the pressure directly enough to meet the burden of proof, instead relying on less-powerful officials’ fear of retribution.
So it should be no surprise that reading through the SLED summary of its investigation into the pharmaceutical company — which was conducted while Mr. Harrell was still the speaker of the House, and with his full knowledge — feels like a cross between hostage videos and derriere-covering bureaucrats who are more concerned that they might get in trouble for yielding to the pressure of a politician than that a politician was exerting inappropriate pressure on them.
• Mr. Bryant, the deputy director of the agency, told investigators that no one had contacted him directly to ask for preferential treatment, but he “indicated that he would have paid attention to a request from the Speaker to make sure it was assigned and being handled.” At the same time, he insisted that he “would not put the Speaker’s permit application ahead of anyone else’s application” or condone anyone else doing so.
• Sheila Young, the employee who wrote the note saying Mr. Bryant wanted the matter handled ASAP, told SLED agents that the application did indeed get jumped ahead of others, but she insisted that “it did not receive any leniency on passing the inspection process.”
• The staffer who received the note from Ms. Young, Clelia Sanders, was the one who called the meeting with Mr. Harrell “unusual.” But she said she was never given “specific instructions” to handle the application any differently than others, that she “always handled applications in the order she received them, and she never moved anyone to the top of the list.”
• The board member who had expressed concerns about Mr. Harrell’s pressure tactics, Bobby Bradham, backpedaled when SLED investigators showed up, telling them the idea that the speaker was getting special attention “was his personal opinion,” based solely on the fact that he had never met with a permit applicant before. He also assured them that “There was never any pressure or influence” on the board, by Mr. Harrell or anyone else, “to handle the PSP permit and licensing request any differently than any other request.”
A familiar story
What makes this story important is the fact that Mr. Harrell is hardly alone in using his position to help his business; I doubt his actions were even more egregious than those of other officials. It seems pretty clear that then-Rep. Nikki Haley wouldn’t have gotten a consulting gig from a government contractor who hired her for her “good contacts” and that she wouldn’t have gotten a six-figure salary from Lexington Medical Center for a job for which she had no apparent qualifications if she hadn’t been a legislator. And who can count the number of legislators who, upon getting appointed to the powerful budget-writing committees, suddenly discovered that their life-long ambition was to own the nursing homes that derive most of their money from the Medicaid program that those committees control?
There was a time when the state’s largest utilities kept all the top lawyer-legislators on retainer, which is to say they sent those legislators regular checks but didn’t ask them to do any work. Lawmakers banned that practice when they overhauled the ethics law in the wake of the 1990 legislative corruption scandal.
I doubt there’s such an easy fix to this more pervasive, wink-and-nod problem, because we’re never going to get around the burden-of-proof problem, particularly when we’re dealing with frightened or even hostile witnesses. But certainly we can discourage it. One place to start is requiring legislators to report the source of all of their income, which would put voters and investigators on notice of potential problem areas. It wouldn’t hurt to go a step further, and require them to report any contact they have with state officials on behalf of their private businesses.
On a final note, SLED spent much less time on the speaker’s attempt to drum up business from hospitals, presumably because they aren’t considered government agencies. But investigators did ask Mr. Harrell about his letter, and provided this comic relief in their report: “He mentioned, in the letter, his position as Speaker of the SC House of Representatives only to make sure that the hospitals knew he was contacting them as a private business owner and not in his official capacity as Speaker of the House.”
I can see him winking as he said that.
Ms. Scoppe can be reached at email@example.com or at (803) 771-8571. Follow her on Twitter @CindiScoppe.