There’s a Department of Government Ethics? What Does it Do?
What is the agency weighing in on the incoming administrations potential conflicts of interest?
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This week, an obscure agency of the federal government raised eyebrows when it began tweeting at President-elect Donald Trump. Trump had announced via Twitter early in the morning on Wednesday that “legal documents are being crafted which take me completely out of business operations. The Presidency is a far more important task!”
Hence, legal documents are being crafted which take me completely out of business operations. The Presidency is a far more important task!
— Donald J. Trump (@realDonaldTrump) November 30, 2016
Alina Selyukh at NPR reports that a few hours later, the United States Office of Government Ethics (OGE) began tweeting back at Trump, congratulating him on his “'total’ divestiture decision” and saying: “We can’t repeat enough how good this total divestiture will be. Bravo! Only way to resolve these conflicts of interest is to divest. Good call!"
.@realDonaldTrump We can't repeat enough how good this total divestiture will be
— U.S. OGE (@OfficeGovEthics) November 30, 2016
.@realDonaldTrump Bravo! Only way to resolve these conflicts of interest is to divest . Good call!
— U.S. OGE (@OfficeGovEthics) November 30, 2016
The exchange raised a lot of questions. But the OGE soon cleared up the meaning of the exchange, issuing a statement from its email account:
Like everyone else, we were excited this morning to read the President-elect’s twitter feed indicating that he wants to be free of conflicts of interest. OGE applauds that goal, which is consistent with an opinion OGE issued in 1983. Divestiture resolves conflicts of interest in a way that transferring control does not. We don’t know the details of their plan, but we are willing and eager to help them with it.
A second statement issued at 3:30 p.m. explained the tweets further:
The tweets that OGE posted today were responding only to the public statement that the President-elect made on his Twitter feed about his plans regarding conflicts of interest. OGE’s tweets were not based on any information about the President-elect’s plans beyond what was shared on his Twitter feed. OGE is non-partisan and does not endorse any individual.
The incident brings up a good question. What is the Office of Government Ethics? Following the Watergate Scandal, the Select Committee on Presidential Campaign Activities or the Senate Watergate Committee was put together to investigate campaign activities related to the presidential election of 1972. In the committee's final report issued in 1974, it included legislative recommendations in three areas: regulation of campaign activities and contributions, the establishment of a permanent special prosecutor, and the creation of a permanent congressional legal service. Among other things, this resulted in the Ethics in Government Act of 1978, which first established the Office of Government Ethics.
At first, the OGE existed under the umbrella of the U.S. Office of Personnel Management, but following the enactment of the Office of Government Ethics Reauthorization Act of 1988, it became an independent agency.
Though there are fewer than 80 full-time employees at the agency, approximately 6,700 individuals throughout the executive branch help the OGE fulfill its mission in some capacity. In essence, that mission is to help create and implement ethics programs within the executive branch’s 130 agencies. That means helping them set up and comply with rules about receiving gifts, conducting business with vendors, and dealing with things like corruption, nepotism and conflicts of interest.
It is not, however, responsibile for enforcing those codes. “OGE’s mission is one of prevention,” its website states. “OGE does not adjudicate complaints, investigate matters within the jurisdiction of Inspectors General and other authorities, or prosecute ethics violations.”
Those matters are referred to each agency's Inspector General or is referred to the FBI or Department of Justic for investigation.
In November, the OGE finalized a significant overhaul of its Standards of Ethical Conduct for Employees of the Executive Branch on solicitation and acceptance of gifts from outside sources, which will go into effect in 2017.
At least for the next few months, one of the OGE’s biggest roles is aiding in the Presidential transition. The office is legally required to review the financial disclosure reports of any Presidential nominees to civilian positions that require Senate approval. The office looks for any conflicts of interest and makes sure nominees properly disclose all of their assets.
“One of OGE’s key responsibilities is to help the President-elect fill top leadership positions by moving prospective nominees through the nomination process quickly and free from conflicts of interest,” OGE's Director Walter M. Shaub, Jr. writes in a statement. “For the past two years, we have been preparing for the influx of nominees that the transition will bring, focusing on training ethics officials, creating resources for incoming leaders and administration officials, and working with agencies and outside groups to establish best practices for the incoming administration.”
Another duty of the Office is to issue Certificates of Divestiture to Executive Branch employees who are forced to sell off businesses or assets to comply with federal ethics rules. After selling the assets, if the cash is reinvested in Treasury bonds of mutual funds, the Certificate allows the employee to avoid paying capital gains tax on the sale. For instance, Michael Shear and Eric Lipton at The New York Times report that Henry Paulson used a Certificate of Divestiture after he sold $500 million in Goldman Sachs stock when he accepted the position of Treasury secretary in the George W. Bush administration.
When it comes to divestiture, examples from presidents past offer guidance for the president-elect, himself, Jeff Stein writes for Vox:
In 2008, Barack Obama decided to liquidate his assets and convert them into treasury bonds and index funds. Ronald Reagan, George H.W. Bush, Bill Clinton, and George W. Bush all placed their assets in a blind trust. Even Jimmy Carter insisted on turning his Georgia peanut farm over to a trustee.
But for now, the OGE, like the rest of the country, will have to wait until December 15, during Trump's announced news conference, to learn the specifics of how he plans to follow through with his promise to comply with divestiture and take himself, "completely out of business operations" during his presidency.