Republican Tom Coburn of Oklahoma is by no means the most conservative member of the U.S. Senate, but he’s often near the top. On the other hand, Democrat Elizabeth Warren of Massachusetts is considered by many to be among the most liberal.
When two seeming polar opposites can come together on a piece of legislation, the American public ought to sit up and take notice. And that’s the case with their bipartisan Truth in Settlements Act, designed to increase transparency when it comes to settlements between federal enforcement agencies and corporations that have broken the law.
When violations occur, the amount of the fine levied against the corporation is typically disclosed, but as Warren and Coburn have noted, those figures are deceptive. Tax deductions and other cushions are built into these agreements, oftentimes reducing the punitive action to a mere slap on the wrist. That means there’s little incentive to keep the offending entity on the straight and narrow, and it’s often well worth the cost to commit the same infraction again and again.
Coburn has long been a proponent of transparency in government, but he often stands up to Big Business as well. The bill, he says, will give taxpayers access to “real” information about enforcement settlements. Warren agrees: “Anytime an agency decides that an enforcement action is needed but it is not willing to go to court, that agency should be willing to disclose the key terms and conditions of the agreement.”
Under the act, written public statements about settlement amounts must detail how the settlements are classified for taxes, and whether credits will offset the tab. Companies will have to disclose in Securities and Exchange Commission filings if they deduct these amounts from taxes, and federal agencies must post basic information on their websites. Any confidentiality attempts must be justified.
Coburn and Warren believe once the public can see what’s going on behind closed doors, the power brokers will be less likely to cobble together sweetheart deals that diametrically oppose the interests of the public they’re supposed to serve. At the same time, consumers can get a better handle on who they’re doing business with, and how often their executives try to cross the line.
The more transparent our government and society can be, the better off the public will be. It’s what the framers intended, and though it’s clearly not what most folks in the upper echelons of government or corporate American would want, it’s most certainly what the public deserves.