Friday, August 06, 2010

Another corrupt public official gets off easy

Peter J. Cammarano III, elected mayor of Hoboken, NJ in 2009, was arrested in a bribery sting just three weeks into his term and pleaded guilty this April to taking a $25,000 bribe in exchange for a promise to help a purported developer (actually an informant) build in Hoboken.  Yesterday he was sentenced to 2.5 years in prison.

I have a phobia about prison. So many American prisons, or units within prisons, are cauldrons of rape, intimidation and sadism. I don't think a human society should incarcerate anyone under the conditions we impose - hard as it may be to create a humane environment composed entirely of convicted criminals.

That said, I've also long thought that corrupt public officials get off easy compared to white collar felons convicted of business fraud. Selling legislation or public contracts or regulatory forbearance harms the public good far more than looting or misrepresenting the finances of a for-profit company.  Americans may assume that lobbyists influence elected officials in malign ways. But soft, nebulous, indirect influence in which advocacy is bolstered by cash is still different in kind from direct bribery.   Our freedom and prosperity depend on the public's faith that elected officials and their appointees not sell legislation and contracts outright.

Elected officials who confess to or are convicted of doing just that get off far more lightly than convicted white collar criminals.  Duke Cunningham, a 7-term Republican congressman on the House Appropriations and Intelligence committees, pleaded guilty to accepting $2.4 million in bribes for his help awarding defense and intelligence contracts. He got 8 years.  Jack Abramoff, the lobbyist who had practically the whole Republican Congress on the string and massively cheated his clients as well as bribing public officials on their behalf, got 8 years. Bob Ney, the wholly owned Abramoff subsidiary who accepted bribes to further the interests of several Indian tribes and casino ventures, got 30 months.

In contrast, Jeff Skilling, CEO of Enron when it imploded in 2001, got 24 years and four months mainly for insider trading and securities fraud -- that is, for overseeing Enron's web of sham transactions and for selling some of his own shares in the runup to collapse.The Supreme Court recently vacated part of his conviction and sent the case back to the lower court, but a significant sentence reduction is not expected. Bernard Ebbers, who oversaw the 2002 bankruptcy of Worldcom and was convicted of accounting fraud and conspiracy, got 25 years. Dennis Kozlowski, CEO of Tyco, which he built into a conglomerate giant over the course of his ten-year tenure, was convicted of looting the company of $81 million in unauthorized bonuses and payment of almost $15 million for art. He got 8 1/3--25 years. 

Skilling and Ebbers, who helped trigger the bankruptcies of major public corporations, bear responsibility for a great deal of suffering and market disruption. Kozlowski's Tyco survived his tenure (as did Worldcom Ebber's, in a sense, as it emerged from bankruptcy after two years and was bought by Verizon in 2005). All three were probably rightly convicted.  But their sentences are disproportionate compared to the sentences of those who betray the public trust and compromise the integrity of government.

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