Virginia Governor Bob McDonnell and his wife reportedly received $120,000 from a political backer, and it may be perfectly legal — if otherwise highly questionable. McDonnell’s real-estate company received $70,000 from Jonnie R. Williams, and McDonnell’s wife Maureen received $50,000 directly from Williams, neither of which were reported on campaign-finance disclosures. But according to Virginia law, neither of the transfers needed to be disclosed:
The payments to the corporation, confirmed by people familiar with the transactions, offer the first public example of money provided by Williams that would directly benefit the governor and not just his family.
The money went from a trust, controlled by Williams, to MoBo Real Estate Partners, a limited-liability corporation formed in 2005 by McDonnell and his sister, the sources said.
McDonnell viewed the payments to MoBo and to his wife as loans and not gifts, according to three people familiar with the transactions. State law requires elected officials to disclose their personal loans but not loans made to their corporate interests. …
“The rules that I’m following have been rules that have been in place for decades,” McDonnell said Tuesday on a Norfolk radio show. “These have been the disclosure rules of Virginia. I’m following those. To, after the fact, impose some new requirements on an official when you haven’t kept record of other gifts given to family members or things like that obviously wouldn’t be fair.”
State law requires the disclosure of any gift valued at more than $50, but gifts to family members are exempt.
Williams also gave $25,000 in two separate gifts to McDonnell’s two daughters to pay for the costs of their weddings, in 2011 and this past May. That brings the total to $145,000 in cash that Williams has sent to the McDonnells in various forms that went unreported until now. The Washington Post notes that the McDonnells appear to have provided perhaps a little quid pro quo for the cash, although not exactly through official channels:
Just about the time Cailin McDonnell got married, Williams’s company, Star Scientific, was introducing a dietary supplement called Anatabloc, whose key ingredient is found in tobacco and other plants.
Anatabloc was crucial to the future of the company, which has been losing money for years. But the science behind the product — an anti-inflammatory the company hopes might be helpful to people with such ailments as Alzheimer’s and multiple sclerosis — was unproven.
Three days before her daughter’s June wedding, Maureen McDonnell flew to Florida, where she spoke at a seminar for scientists and investors interested in anatabine, the key chemical in Anatabloc, according to people who attended the conference.
The governor’s wife told the group that she supported the product and touted the pill, which is not regulated by the Food and Drug Administration, as a way to lower health-care costs in Virginia, the attendees said.
About three months after the wedding, the McDonnells and Star Scientific were together again, this time at the governor’s mansion for the official launch party for Anatabloc.
All of this appears to have avoided breaking the law. Not everything that is legal is necessarily moral, however. Taking this kind of cash as a public servant — whether as “loans” or gifts to one’s spouse and children — looks suspiciously like enriching one’s self through positions of public trust. While it’s true that the state cannot prosecute McDonnell for actions that don’t violate the law, Virginia voters can certainly look at his actions and the cash he’s managed to accrue from political backers and determine whether McDonnell is exploiting his office for personal gain. I’d certainly like to hear a better explanation than “I didn’t break the law as it exists in Virginia” as an explanation for the cash gifts and “loan” exposed here.
Perhaps it’s time the state of Virginia updated its gift laws to include disclosures for spouses, family members, and businesses for gifts over a floor value.
Update: National Journal argues that quid pro quo corruption is not the only variety:
Right now, though, it’s impossible to say that there was an explicit “this for that” exchange that’s central to conventional political corruption. Yes, Maureen McDonnell did speak to doctors and investors about the benefits of Star Scientific’s Anatabloc supplement, and the product was launched in 2011 at the Virginia Governor’s Mansion. Williams also was able to pitch the product as a cost-cutting boon to a top official from the Virginia Health and Human Resources Department.
But, so far at least, there’s no evidence that any gifts or financial assistance was explicitly given by Williams in exchange for access or assistance for Anatabloc and Star Scientific. Without that, there’s no obvious, quid pro quo political corruption. But in an age of massive campaigns and nonstop fundraising, that’s not the only kind of corruption there can be. …
As Lessig writes, the gift economy can lead to dependency corruption, where even though there is no obvious ill will, dependency on a donor can lead to the deterioration of objectivity when it comes to examining the interests that that donor represents.
The McDonnell situation doesn’t necessarily fit this gift-economy mold perfectly. As Lessig pictures it, the political gift economy is largely a product of campaign fundraising. With McDonnell, in some cases, direct cash was given by Williams. But with “gifts” like the Rolex, the food catering, and the Final Four airfare, some of this is at play.
Is there proof that Williams, in giving those gifts, demanded reciprication for his company? No. At least not yet. But that doesn’t mean that McDonnell and his family weren’t inclined to look at Williams and Star Scientific more favorably because of the financial assistance they were given.
One could say the same about any kind of political contribution, but that’s usually a lot less personal than large gifts to family members.