Confusion about “Conflict of Interest”

The Washington Post‘s “Senate Panel Ban Seen as Double Standard” deals with the latest attempt to eliminate so-called “conflicts of interest” between appointees to government defense-related positions. Appointees must divest themselves — often at great cost — of all investments in any firm that does business with the military.

The article notes this same prohibition has not been extended to federal legislators serving on military committees. A more relevant point is that this policy discourages individuals knowledgeable about military procurement (that is, those involved in the process) from serving in government. This point was raised recently in a C-SPAN interview with Lord John Wakeham, a distinguished parliamentarian from England.

He argued that before going into politics, an individual should first make some money, learn how the world operates.  Banning links to the market weakens the ability of legislators to make reasonable policy decisions. Lord Wakeham instead favors “disclosure.” And he, in my view, is quite right. A vigilant media can be expected to scrutinize the decisions of individuals in government in any event.

The recent trend to ban “conflicts of interest” threatens many things. The challenge is not to eliminate such conflicts, an impossibility in any event, but rather to manage them to achieve more creative outcomes. Moreover, the bias which sees only economic conflicts as meriting policy reform means the relative weight given ideological conflicts is exacerbated. History suggests there are much greater risks involved in enhancing the power of ideology than in economic scandals.

Unfortunately, the power of ideology has increased greatly in the last few decades. Those worried about the bitterness of partisan conflict in recent years should reconsider. After all, the tyrants of history were not primarily motivated by money, but rather power. Do we wish these “public servants” to be our role models for the future?