Phony ethics charges shouldn't distract from the nation's defense. BY RICHARD PERLE

[Dave Farber <dave () farber net>]

[ His comments on public service are correct in part. Known conflicts are a
critical piece of knowledge in Gov Adv Boards. Wether the requirements of
the Chair of such a Board is greater legally is a question I am not
qualified to answer. I learned, however over the years, that it is the
apparent conflicts of interest that hurt people and that one must be super
careful to deal with them. Whether Perle did is for you and the Congress etc
to judge. Djf




CLEARING THE AIR 
For the Record
Phony ethics charges shouldn't distract from the nation's defense.
BY RICHARD PERLE
Monday, March 31, 2003 12:01 a.m.
Last week I resigned my position as chairman of the advisory Defense Policy
Board after news stories, rich in innuendo, suggested that I had acted
improperly in advising Global Crossing (the New York Times) and, in a
separate matter, in meeting over lunch with two Saudi businessmen (The New
Yorker). They provoked an avalanche of stories, mostly repeating points in
those first two, with each iteration making more extreme allegations than
the last. There was no way I could quickly quell the press criticism of me,
even though it was based on factual errors and tendentious reporting. So I
wrote to Donald Rumsfeld, "I have seen controversies like this before and I
know that this one will inevitably distract from the urgent challenge in
which you are now engaged. I would not wish to cause even a moment's
distraction from that challenge."
Let me explain my milieu, and context. Government officials, particularly at
the most senior level, frequently seek advice from outside the departments
they superintend. The perspective of knowledgeable outsiders is often a
needed corrective to an institutional view that may have come to dominate
the department's thinking. Sometimes senior officials face vexing questions
for which their staffs provide unsatisfying answers, or they want a
longer-term view. It is only natural that an intellectually curious cabinet
officer will reach out to peers who have occupied similar positions, in the
hope that their experience will help avoid mistakes or point the way to new
ideas. When he does so, he must have confidence that the advice he receives
is candid, that it is the product of serious deliberation, and that it is
free from advocacy reflecting private interests. The relationship between
official and adviser is ultimately one of trust.

Most often, the people best able to help are professionally involved in the
businesses for which the official is responsible: health professionals or
pharmaceutical company executives advising the Department of Health and
Human Services, for example, or energy company officials advising the
Department of Energy, or defense executives advising the Department of
Defense. If the secretary of defense wants advice on new approaches to the
conflict between India and Pakistan, or how far and how fast to press
technical innovation in precision-guided weapons, he is unlikely to turn to
a dress designer or a molecular biologist. (Hollywood personalities might be
similarly ill-equipped, but he is likely to get their advice whether he
wants it not.)




There is no way, of course, to be sure that an outside adviser (or for that
matter, a subordinate) is not driven by a private passion, a deeply held
conviction that skews his judgment, or a private policy agenda. Only by
judging the cogency of the advice he receives--and over time the track
record of the adviser--can he be confident that he is receiving balanced
counsel.

But there are ways to ensure that advice does not advance personal financial
interests, and they are reflected in rules that apply to the many thousands
of individuals serving on hundreds of boards which advise government at all
levels. The two key rules are simple and flow from a familiar principle:
that public office should not be used for private gain.

The first rule is full disclosure of the financial interests of the adviser.
This is accomplished by annual filings of the board member's business
interests, sources of income, clients, share holdings and the like. The
second rule is straightforward: If the discussions or advice of the board
should involve matters that have a direct and predictable effect on an
adviser's financial interests, he is recused from taking part. An adviser
following these rules should be free to give his best candid advice, and the
official receiving advice should not have to worry that it might be tainted.
These are the rules that members of government advisory boards accept when
they agree to serve on them. They are not obliged to terminate their
employment or abandon business interests, even those that may benefit from
decisions of the department or agency they advise.

Since most people with experience and knowledge relevant to defense and
national security policy are likely to earn their livelihood in
defense-related enterprises, the possibility of conflict of interest is
always present and must be contained by adherence to the two rules,
disclosure and recusal. Without those rules, and the protection they afford,
few individuals with knowledge or experience would agree to serve on
advisory boards, and the benefits of those boards would be lost to policy
officials. 

I have been privileged to chair the Defense Policy Board for nearly two
years. During that time the board has debated many issues, including U.S.
policy with respect to Iraq, weapons of mass destruction, European-U.S.
relations, the war on terrorism and the like. The discussions have been
lively, the views expressed diverse, and the board's experienced
members--former secretaries of state, defense and energy, former directors
of Central Intelligence, former speakers of the House from both parties, a
former vice-president, professors, a Nobel laureate (in economics) and
several recently retired general officers--have used the board's meetings to
share their views with the secretary of defense.

The Times story about my work for Global Crossing gave the impression that I
had been retained to use influence stemming from my chairmanship, my "close
ties to current officials," to obtain a favorable ruling on the acquisition
of Global Crossing by a joint venture including a Hong Kong company. This is
incorrect. (When I asked the Times to publish a letter in reply, I was told
that they would not unless I dropped the word "incorrect." Thus I learned
that the Times censors letters to the editor.)

In truth, I was retained to advise Global Crossing on how it could meet the
government's security concerns about the transaction, not to "help overcome
Defense Department resistance" to it. To do this I had to persuade Global
Crossing to accept some far-reaching safeguards, which it has now done. My
task was to make intelligible to Global Crossing the government's concerns,
not to use influence to get the government to set those concerns aside--the
precise opposite of the Times' characterization.

The New Yorker piece by Seymour Hersh is a masterpiece--of falsehood and
innuendo. He describes a lunch I had with two Saudi businessmen, during
which the situation in Iraq was the sole topic of discussion, as a "cover
story" for another purpose--eliciting a private Saudi investment in a fund
in which I am a partner. And he quotes Saudi Ambassador Prince Bandar to the
effect that "if we get in business," I would "back off on Saudi Arabia."
Sprinkled in the article are references to conflicts of interest, although
the incoherence of the piece reflects Mr. Hersh's Houdini-like twists and
turns, intended to question my integrity.




Neither piece shows that I departed from the rules of disclosure and
recusal. Global Crossing was never a topic in my board. Had it been, I would
have recused myself. Mr. Hersh implies that my involvement in a fund set up
to invest in homeland security technologies might by itself constitute a
conflict of interest. But there is nothing in the rules governing the board,
or in any reasonable ethical judgment, that would preclude my working in
such a fund. He implies there may be a conflict of interest issue because I
am a non-executive director of a software company, Autonomy, which recently
won a contract to supply software for homeland security. But Autonomy never
came before my board--specific companies almost never do. Had it, I would
have recused myself.

The Times story further suggested that the very fact that I served on a
board--and that this service was mentioned in documents that summarized my
background and qualifications--was in itself a conflict. But this suggestion
cannot be serious. Everybody I work with knows who I am and what I have
done, whether I attach my résumé to the paperwork or not. Those who serve
without any compensation on these boards do so as a civic responsibility. We
give time and expertise and we accept the terms of membership, including
rules concerning conflicts of interest, willingly. But few of us could do so
if we were prevented from working in the areas about which we are consulted,
and the value of our advice would be sharply diminished if we left our
professional pursuits.

Somewhere there is probably a board that advises some agency of government
on fashion trends. I suppose I could join it without fear that the New York
Times or Seymour Hersh would accuse me of a conflict of interest. My wife
would be appalled.

Mr. Perle was chairman of the Defense Policy Board.

Copyright © 2003 Dow Jones & Company, Inc. All Rights Reserved.

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