Hook or Crook in Washington

House Majority Leader Tom DeLay has become the Teflon Don of politics -- surviving allegations that include bribery, misuse of federal personnel and unlawful campaign practices. Last week, he did it again, when his fellow Republicans gutted a House ethics rule in order to protect him.

DeLay faces the possibility of indictment in Texas in criminal acts related to fundraising. The old rule would have required DeLay to resign his majority leader post if indicted; the new rule lets him keep that post no matter what happens in Texas.

Many citizens were shocked to see the Republicans vote overwhelmingly to overturn their own ethics rule. In reality, getting upset by the DeLay rule change is like complaining that bank robbers double-parked their getaway car.

Consider how often members of Congress come to Washington with modest incomes and leave government service millionaires. The chief reason is a series of loopholes crafted into the House and Senate ethics rules.

The most cherished loophole concerns stock interests. The House rules are a model of disinformation on what constitutes conflict when it comes to stocks. They specifically prohibit a member from accepting any outside income above 15% of his or her salary. However, outside income is defined to exclude investment income from stock. The result is that members routinely hold stock in companies that are directly affected by their committees or that directly benefit from their legislation. Members have repeatedly refused demands that they establish a rule requiring them to set up blind trusts for investments or to recuse themselves in situations where they stand to gain -- rules already in place for other government employees.

And members are in a unique position to get valuable market tips. Their investigations and legislation can inflate or deflate the value of stock. Moreover, lobbyists for major companies are likely to have helpful information for preferred members.

A recent study done by researchers from four universities found that between 1993 and 1998, senators beat the market by 12 percentage points in their investments, a level of return that financial experts described as a “statistical stunner.” Another study found that three out of four randomly selected members had engaged in stock transactions in areas where they had legislated.

There is a rule that members can’t legislate for the benefit of a single company with which they have a financial interest. Yet they can push legislation that helps whole industries -- where they just might be heavily invested. For example, Senate Majority Leader Bill Frist (R-Tenn.) has long lobbied for medical malpractice reform. He and his family have a hospital chain and a malpractice insurance company that benefit from such legislation.

Members can also craft legislation that benefits business associates, as long as their “association” isn’t technically tied to that bill. For example, Rep. James P. Moran (D-Va.) took an unsecured $25,000 personal loan from a drug company lobbyist and then pushed a bill that benefited the pharmaceutical industry and that company. And Sen. Ted Stevens (R-Alaska), chairman of the Senate Appropriations Committee, is infamous for such dealings. He steered a $450-million military deal to a real estate developer named Jonathan Rubini. Stevens had no financial interest in that deal; however, Rubini was his partner in a different business deal in which Stevens increased a $50,000 investment to as much as $1.5 million over six years. Stevens has also pushed government contracts to a company that, again in a separate deal, pays more than $6 million in rent each year to Stevens and partners.

In such a sordid context, the DeLay rule change may actually pass for honesty in Washington: At least the Republicans had to vote in the open to proclaim their willingness to embrace a criminally indicted leader.

Every day in Washington, tourists stand in awe of Constantino Brumidi’s Capitol Rotunda masterpiece, “The Apotheosis of Washington” -- in which a comely star-crowned Liberty chases Tyranny and Power with a mighty sword. Few visitors know that all three images are thought to have the faces of prostitutes “familiar” to Brumidi -- a fitting reminder of the Washington preference for appearing virtuous without actually being virtuous. The harlots under the dome must have cracked a smile when the Republican members took the floor in defense of Tom DeLay last week.