Tuesday, August 19, 2008
Evan Bayh's wife's alleged conflicts
Susan Bayh, wife of Obama VEEP short-lister Evan Bayh, apparently sits on a number of corporate boards that have theoretical or positional interest in matters under Senator Bayh's jurisdiction. This is supposed to constitute a "problem" for Evan Bayh's prospects. No doubt that it is, but only because of our sad obsession with a certain sort of institutional conflict of interest.
The corporate directorships of a politician's spouse are easy fodder for journalists, because they rarely understand corporate governance and there is an extensive online trail associated with directorships that relieves reporters of the more difficult job of unearthing actually significant conflicts. Most of the time, however, these supposed corporate conflicts are not actual conflicts, or they are so immaterial that they are of only symbolic significance. The reason, of course, is that a director's duties are to the corporation's stockholders, not to themselves personally or their spouse as a politician. While that duty might motivate them to chat up their politically powerful spouse in the corporation's interest, the director does not personally benefit from any possible legislative victory except insofar as he or she is a stockholder. Neither Bayh would gain anything if Evan favored the corporations for which Susan is a director on any basis other than merit. No director ever got a commission or finder's fee for persuading their husband to vote a certain way. Politically connected directors may be in a position to advise the corporation in the ways of Washington, but that is advice that otherwise can be purchased. Susan Bayh is undoubtedly contributing what all directors contribute to corporate governance, her advice. I see no conflict worthy of the name.
The other problem with worrying about the supposed conflicts of political spouses is that it distracts from other conflicts that may spring from less easily documented relationships. Why are we so worried about wives? Are there not similar conflicts between a CEO and his best golfing buddies? Again, one gets the sense that reporters focus on spousal conflicts because they take no effort to prove; journalists assume, stupidly I think, that a politician is more likely to favor his spouse to the point of conflict than some other close relationship. Dubious.
Of course, there is a basic problem here for Democrats, who make a point of bashing on business to score political points. How can a Democrat actually serve on the board of a -- gasp -- corporation? Thought of that way, these stories are not really about conflicts of interest but about hypocrisy. The press hammers Republicans who have affairs or gay bathroom sex because it contradicts the family values thing, and it skewers Democrats who have somehow soiled themselves with commerce. From that point of view, I suppose the Bayhs ought to have known better than to do anything on behalf of "the corporations".
My last question: Which VEEP candidate pushed this story at this late date to knock Evan Bayh out of consideration? Inquiring minds want to know.
2 Comments:
By 
, at
Tue Aug 19, 07:09:00 PM:
I don't know, Tigerhawk. I generally trust you on these matters, but it seems hard to believe that there is virtually no conflict of interest. My own company (a defense contractor) hires ex-military/gov folks all the time. They do this for multiple reasons, many good (experience in the field), some in the grey area (contacts).
I find it very easy to believe that companies would hire Bayh's wife simply to get her contacts and influence. You know much more than I do about what being a director entails, but it appears to me that it is decent money for very little work.
By , at
Wed Aug 20, 02:31:00 AM:
the director does not personally benefit from any possible legislative victory except insofar as he or she is a stockholder
They can if they are also an employee. Witness the near-tripling of Michelle Obama's salary at about the same time Barack pushed for a Federal grant to her employer.
