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Doomed to Fail

October 21, 2011

By Ann Hollingshead

Ann Hollingshead is a Financial Transparency Coalition blog contributor, whose posts appear weekly. Formerly a Junior Economist at Global Financial Integrity, Ann is now pursuing a Master of Public Policy (MPP) from the University of California Berkeley. Follow her on Twitter: @AnnHollingshead.

Why America Won’t Let the Chamber of Commerce Weaken the Foreign Corrupt Practices Act

Yesterday I switched on the radio in my car and heard a familiar phrase. Just as I started listening, NPR had just started reading a story on the Foreign Corrupt Practices Act, or FCPA, and the recent efforts by the U.S. Chamber of Commerce to amend the law. Feeling excited, I turned up my dial.

The Chamber’s basic argument is that the FCPA, the flagship U.S. legislation that makes it illegal to bribe a foreign official, is too cumbersome on U.S. businesses. For months now, the Chamber has been lobbying to weaken the FCPA and has even retained former U.S. Attorney General Michael Mukasey to help. According to a compelling article by Raymond Baker, Director of Global Financial Integrity, the Chamber’s requests include (among many others) giving “subsidiaries of multinational companies a loose rein” with the FCPA so that the actions of a foreign subsidiary should not expose the parent company to liability and limiting successor liability in cases of mergers and acquisitions.

The Chamber and Mukasey have already won over Rep. Jim Sensenbrenner (R-Wi), who is now leading the charge to amend the FCPA. Sensenbrenner is now spending valuable Judiciary Committee time convincing other Congressmen to join him, rather than encouraging a thoughtful debate on the issue.

So back to my moment of excitement in the car. As I listened to the NPR story, which gave a pretty impartial overview of the situation, I had one, overwhelming thought: the Chamber of Commerce is going to fail.

Raymond Baker has already made this point. Last month Baker wrote a letter to Rep. Jim Sensenbrenner (R – WI) with the title An Effort to Weaken FCPA Will Not Succeed. In the letter Baker writes that campaign supporters may not “look fondly” on efforts to weaken the FCPA. “I cannot imagine,” Baker sharply remarks to Sensenbrenner “that your next election campaign will be enhanced by advocacy of an issue so inimical to American interest.”

I must say, when I read the letter I did not share Baker’s conviction. You can call it pessimism, or apprehension, or just plain fear, but although I wanted so badly to trust Baker’s words, I could not bring myself to share his resolve. But when I heard the NPR story, I realized I should not have doubted his word, which is based, by the way, in decades of experience. And the reason I made up my mind to agree did not have anything in particular to do with the NPR story, but rather it was the simple fact that NPR was reporting on it at all.

Here’s the thing. Congress gets a lot done “behind the scenes.” This isn’t necessarily a problem. A lot of its job is administrative and, while the American people should have access to all of Congress’ decisions and there should be transparency in that process, American’s don’t necessarily need to have an opinion about every decision. We just don’t have time for that. But the American people do need to be informed on many decisions. Particularly when Congress is doing something questionable. And when they do… it changes everything.

The Chamber of Commerce would like nothing better than to keep America in the dark about this one. It’s not in its interest to have Americans informed, because Americans will immediately see through the Chamber’s weak veneer to the greed and immorality that lies below. As this discussion continues—and as the backdoor conversations between Sensenbrenner and the Chamber of Commerce are brought under the scrutiny of the American people—the dynamics will change. It will no longer be a deal the Chamber can buy with an expensive lobbyist. When the American people understand this plan, they will reject it. And, as Baker has already put it, the Chamber will not succeed.

The ugliness of governance is that powerful individuals can take advantage of the system to reward themselves. The beauty of democracy is that we have the power to stop them. The plan Sensenbrenner and the Chamber have hatched to weaken the FCPA will fail because it is greedy and it is immoral. It flies in the face of American values, principals, and promises. And America will reject it. Because we reject immorality everywhere, including at home.

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Disclaimer: Unless specifically stated to be the views of the Financial Transparency Coalition, the opinions expressed on this blog are solely the opinions of the individual blogger and are not necessarily those of the Financial Transparency Coalition.

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