pageok
pageok
pageok
Did Barack Obama Violate the Illinois Governmental Ethics Act?--

Paul Caron has Barack and Michelle Obama's tax returns on his website (tip to Instapundit). The first thing that jumped out is that in some years Barack received no speaking fees or honoraria. Apparently, as an Illinois state legislator through 2004, Barack was prohibited from taking honoraria for speaking under the Illinois Governmental Ethics Act.

But what about Barack Obama's 2000 and 2002 tax returns?

2000: On his 2000 Schedule C-EZ, Barack reported that he received $16,500 as a "Foundation director/Educational speaker."

2001: On his 2001 Schedule C-EZ, Barack reported $98,158 from a Chicago law firm, Miner, Barnhill, for "Legal services/attorney" (and nothing for speaking).

2002: On his 2002 Schedule C, Barack reported $34,491 for "LEGAL SERVCES / SPEAKING FEES."

These "speaking fees" are in addition to the amounts that Barack was paid as an employee, a lecturer at the University of Chicago, reported on the first page of his 1040s.

The Illinois Governmental Ethics Act (apparently last changed in 1995) provides:

(5 ILCS 420/2-110)

Sec. 2-110. Honoraria.

(a) No member of the General Assembly shall accept any honorarium.

(b) As used in this Section:

"Honorarium" means a payment of money to a member of the General Assembly for an appearance or speech, excluding any actual and necessary travel expenses incurred by the member of the General Assembly (and one relative) to the extent that those expenses are paid by any other person. "Honorarium" does not include (i) cash payments made on behalf of a member of the General Assembly to an organization described under Section 501(c)(3) of the Internal Revenue Code of 1986, (ii) an agent's fee or commission, or (iii) funds reported under Article 9 of the Election Code [i.e., campaign contributions].

"Travel expense" means the reasonable cost of transportation and the reasonable cost of lodging and meals incurred while a person is away from his or her residence or principal place of employment.

(c) Any honorarium or honoraria accepted in violation of this Section shall be surrendered to the State Treasurer and deposited into the General Revenue Fund. (Source: P.A. 89 405, eff. 11-8-1995.)

Did Barack Obama violate this over-restrictive Illinois ethics act? Without knowing the precise situations and sources of these "SPEAKING FEES" in 2002 and payments as an "Educational speaker" in 2000, it is impossible to be certain whether any of this compensation meets the statutory definition of "a payment of money to a member of the General Assembly for an appearance or speech."

Also, I wonder whether Obama has rectified this problem in some way that I have not heard about. If not, I wonder whether Barack or his campaign has some explanation for accepting "SPEAKING FEES" or whether at this late date he should "surrender" several thousand dollars to the Illinois State Treasurer.

(Of course, my quick analysis assumes that Obama received no speaking fees besides those reported on his 2000 and 2002 tax returns — and thus has paid all the federal taxes he owed.)

UPDATE: More on the Obama Tax Returns:

Byron York

Michelle Malkin

Victor

Macranger

In the comments below, ReaderY notes just how silly such ethics statutes are:

On the speaking fees issue only, Winston Churchill didn't inherit the family wealth and for many years had to speak and write for his living, despite being a Member of Parliament. At the time this was not considered a dishonorable way to live. Are we now living in an age where Winston Churchill's way of life would be considered unethical?

And in part we have John McCain to thank for our current over-restrictive federal regime governing campaign ethics.

Related Posts (on one page):

  1. Plagiarism at MyDD.--
  2. Did Barack Obama Violate the Illinois Governmental Ethics Act?--
Jim at FSU (mail):
Good catch.
3.25.2008 11:14pm
Jim at FSU (mail):
I know the Federalist Society keeps track of people that speak at the schools- I certainly remember everyone that we got to speak here and what arrangements were made to secure their attendance. I imagine other organizations have similarly sharp memories of when people speak and whether they paid them an honorarium. At the very least, event attendees should remember prominent speakers.

Any semi-recent law school or college graduates here remember Obama speaking at their school in the past 8 years? Any idea which organizations invited him to speak or organized the event? Post up if you recollect this so the inquiring may commence.
3.25.2008 11:20pm
p3731 (mail):
Who cares?
3.25.2008 11:32pm
always private:
Okay, so he and wife have found a way to get more money than they deserve, and maybe they're doing it somewhat dishonestly. Who's surprised? They're politicitians playing in the big leagues.

Let's just let him get the nomination before we go after him. I don't like him, but my DON'T LIKE of former First Lady Clinton is even greater than my dislike of Obama and his Mrs. The Obamas look like the Clintons in that they seem to think they deserve to live like royalty. The difference if the Clintons get back in the White House is tht they know enough to do some serious harm, even if they get only four more years.

The Obamas? So, they'll "steal some china" (figuratively speaking) and they'll line their pockets when they leave the White House, but they don't know enough to do any really serious harm to this county. They'll count it as winning the Jackpot Lottery.

Don't kick him until he has the nomination.

And, besides, who was the last Presidential candidate who was not trying to line his pockets? And who was the last President who didn't try to line his pockets by being President? Maybe Eisenhower? I've come to gag at the overpaid politicians who get paid because of their political connections, but I see it as a reality of this country. ... I doubt that McCain is any better. They all sell out, and they do it because they imagine that they "deserve it."
3.26.2008 12:05am
huskerfan:
Is this the best you can do?
3.26.2008 12:22am
Brett Marston:
Jim: did you ask the Senator or his office for comment?
3.26.2008 12:27am
ReaderY:
On the speaking fees issue only, Winston Churchill didn't inherit the family wealth and for many years had to speak and write for his living, despite being a Member of Parliament. At the time this was not considered a dishonorable way to live. Are we now living in an age where Winston Churchill's way of life would be considered unethical?
3.26.2008 12:45am
E:
ReaderY, the issue is with violating the law at hand.
3.26.2008 12:49am
Soronel Haetir (mail):

Well, remember, this is Ill. we're talking about. Someone probably got this passed in order to make the tame pols even more dependant on bribes.
3.26.2008 12:54am
Tony Tutins (mail):
I guess a legislator who made his living as a public speaker would starve. As a matter of fact, State Senator the Reverend James Meeks makes his living by speaking from the pulpit every Sunday -- would he have to turn his salary over to the State of Illinois?
3.26.2008 1:03am
Jim at FSU (mail):
A legislator in IL is supposed to make his living legislating. If that wasn't the case, they wouldn't have outlawed the receipt of honorariums by legislators.
3.26.2008 1:29am
Dave N (mail):
A legislator in IL is supposed to make his living legislating.
As ppposed to New Hampshire, where legislators get paid the princely sum of $100 a year and as a result some evidently never bother to show up for work.
3.26.2008 1:42am
Tony Tutins (mail):

A legislator in IL is supposed to make his living legislating.

On $58K a year? The legislature is scheduled to meet only from January to May, so presumably the legislators can take up other matters the rest of the year.
3.26.2008 1:55am
James Lindgren (mail):

Brett Marston:

Jim: did you ask the Senator or his office for comment?




Yes, I contacted his campaign's media and press group and am awaiting a response.

Jim
3.26.2008 2:22am
Baseballhead (mail):
UPDATE: More on the Obama Tax Returns:

Byron York
Michelle Malkin
Victor
Macranger
Wow, what a diverse collection of analysis.
3.26.2008 2:54am
Public_Defender (mail):
A fair question. Now another fair question: Where are Hillary's returns? What's she hiding
3.26.2008 8:01am
Hoosier:
It's too risky for Hillary to release her returns: They're covered by snipers.
3.26.2008 8:47am
Qwerty:
they don't know enough to do any really serious harm to this county.

Obviously wrong as well as overtly racist. Nice.
3.26.2008 8:55am
wuzzagrunt (mail):
The Obamas' tax returns have been taken out of context.
3.26.2008 9:22am
Haberdash:
"Is this the best you can do?"

Seems more substantive than some fibbing about a trip to Bosnia 15 years ago. We'll see how much coverage this gets in comparison. My quess: Not Much. The messiah can do no wrong. But, yes, the law is incredibly stupid and I could easily understand if Obama unintentionally broke the law. But it does look like he did in fact break the law.
3.26.2008 10:09am
Elliot Reed (mail):
I look forward to Prof. Lindgren's equally exacting scrutiny of John McCain's tax returns.
3.26.2008 10:17am
Aultimer:
Perhaps Mr. O reads the honorarium rule to have limits tying the subject fees to legislator-related events. I know lawyers often speak for free at CLE-type events, but it's conceivable that he did some speaking entirely unrelated to that role (like sessions on tax code at a CPA review) for grocery money.
3.26.2008 11:58am
Dave N (mail):
I look forward to Prof. Lindgren's equally exacting scrutiny of John McCain's tax returns.
As a McCain supporter, I do too.
3.26.2008 12:14pm
Joe Kowalski (mail):
Playing Devil's Advocate: Is it at all possible (or plausible) that Sen. Obama actually did as the ethics law required, and turned his speaking fees over to the state treasury? Is there some bizarre twist in the tax code that would require him to report the income (and pay taxes on) to the feds, but not be able to take a deduction for turning it over to the State?
3.26.2008 12:40pm
alkali (mail):
Aultimer:

I suspect there may be an interpretation of the honorarium ban that limits the reach of the statute, but I don't think it would be a limit to legislator-related events. The purpose of the statute is to prohibit honoraria that are or appear to be de facto bribes, and it would be peculiar if you could avoid the statute simply by giving a speech on some unrelated topic.

It could be that the limitation to payment "for an appearance or speech" is interpreted to exclude payment for work that involves speaking beyond a single appearance or speech. (For example, the state senator who is also a minister who preaches sermons.) It seems possible that Obama did some work that fell into this category, but you can't know based on the tax return description.

I was not able to find any regulations construing this statute. It is typically the case with these kinds of ethical statutes that there is a board that issues authoritative interpretations of the statute, and/or an office that officials and public employees can call to get authoritative interpretations of the statute, but I haven't been able to find out anything in this regard. (There is a State Board of Ethics, but its authority seems to be limited to public employees.)
3.26.2008 12:47pm
Orielbean (mail):
I thought the honorarium ban was meant to keep public officials from using the power of their office for personal gain (hire a Senator for your next Rotary meeting!) That makes sense to me, but of course there's a million ways around that one...
3.26.2008 2:03pm
alkali (mail):
Orielbean: I think that amounts to the same thing. The point is that you don't want private entities putting money in the legislator's personal pockets because it might corrupt (or appear to corrupt) the legislator's judgment.
3.26.2008 2:48pm
Westie:
I think you're glossing something over.
You say "a payment of money to a member of the General Assembly for an appearance or speech" but you leave out "excluding any actual and necessary travel expenses incurred."

Wouldn't Obama be required to report travel expense reimbursements/coverages on his income tax forms (as income) while, at the same time, those wouldn't be covered as honoraria?

For example, he might have been reimbursed for something like this:
"On a Saturday night in September 2002, the Pierre Menard Democrat Club held its annual membership dinner at a VFW hall in Sparta, where a few hundred party faithful paid $100 to eat roast beef and ham. Obama was a last-minute fill-in keynote speaker. He made the 650-mile round trip in one day, needing to be back for a church event Sunday morning.
3.26.2008 5:36pm
alkali (mail):
Westie: By the same logic, we would see those amounts taken as buesiness deductions on Schedule C.

FWIW, I'm an Obama supporter, and I think the most likely scenarios here are (a) there's something going on we don't understand -- e.g., there's something about the nature of the speaking fees that causes them to fall outside the honorarium ban, or there is some interpretive twist on the statute that we're all unaware of -- or (b) it's an oversight that should be corrected. If it's (b), that's clearly less than good, but how bad it is depends on the circumstances: if some out-of-state university paid him to give a lecture based on his book, and he didn't remember that would be treated as an honorarium, that's one thing; if it's some entity with business before the state giving him a check marked "honorarium," that's another. So I'd hope the campaign clears this up.
3.26.2008 7:38pm
Rich Rostrom (mail):
The comment about Churchill is a good one. But in fact Churchill was financially supported for political reasons, and some of this money was IIRC labeled payments for speaking and writing. In some cases, it was not so much a question of a straight subsidy as Churchill saying "I need to make some money," and someone like Beaverbrook saying "OK, how about ten articles for my papers at 100 quid each." It's not as though the articles would be worthless; the question would be, was Beaverbrook paying extra? Or even buying because he wanted to support Churchill?

There are obvious ways to abuse such practices. For instance, ex-House Speaker Jim Wright had a bunch of his speeches printed up as a pamphlet, and various people bought the pamphlets by the case. On the other hand, ex-House Speaker Newt Gingrich wrote books that were published by real publishers and sold in actual bookstores.

Bill Clinton makes enormous sums as a speaker; but almost everyone, even bitter political enemies, acknowledge that Clinton is an extremely good speaker. How does one divide the payoff (if there is one) from the honest pay? How would that play during a Hillary Clinton administration?

IMO the bsst remedy is disclosure; and let the people decide.
3.29.2008 10:56pm