Is doesn't pay to uncover waste

By BRANDON ARNOLD
CATO INSTITUTE
The federal agency that provides legal aid to the poor has come under fire for wasteful spending, but of all heads to roll, the man who identified the misuses is most likely.
During his two-year tenure as inspector general of the Legal Services Corp., Kirt West has uncovered numerous instances of potential waste and fraud. As the Associated Press reported last week, LSC employees have expensed $400 chauffeured sedan rides across town, dropped over $55,000 on conference accommodations in Puerto Rico, and leased lavish offices on the Georgetown waterfront at $8 more per square foot more than any other tenant.
While testifying before a congressional subcommittee about the LSC's $17.1 million Georgetown lease deal last June, West estimated that the agency "would overpay at least $1.23 million and perhaps as much as $1.89 million."
The deal included a $2 million tenant improvement payment to the Friends of the Legal Services Corp., a group with close ties to the LSC's board, and West testified that the board's actions "could constitute administrative and even possibly criminal violations of the conflicts-of-interest laws."
Rooting out fraud
Most federal departments employ an inspector general to conduct audits, encourage efficiency, and root out fraud. Inspectors general serve, in essence, as taxpayer advocates.
West, a veteran of various federal agencies, had nearly 20 years of experience in the business when the LSC board hired him for the job in 2004. The board thought so highly of West's credentials that it paid him a $25,000 recruitment bonus.
Since then, of course, West's relationship with LSC management has gone downhill. While a tenuous relationship between an inspector general and his employer can be good for taxpayers, it can also be a major headache for an inefficient agency. And after two years of dealing with the headache caused by West's unrelenting scrutiny, the LSC board seriously considered firing him.
When word of this reached Capitol Hill, several congressmen intervened. Before what West thought would be his last board meeting as LSC inspector, Rep. Chris Cannon, a Republican of Utah, sternly warned the chairman of the LSC's board not to dismiss him. Sens. Mike Enzi of Wyoming and Charles Grassley of Iowa, both Republicans, also sent a formal letter to the board stating that "any attempt to fire (West) or to remove him from his position would be an obstruction of the investigation being conducted at our request" and "will not be tolerated."
Perhaps fearing that congressional warnings would not be sufficient, just prior to departing for August recess, Cannon introduced a bill that would require a vote of nine of the 11 LSC board members to dismiss the agency's inspector general. Currently, only a simple majority is needed.
Small victory
It's too early to know if Congress will pass his legislation or not, but Cannon's actions may have already saved West's job. If so, this is a victory -- if only a very small one -- for limited government and transparency. And these days, such victories are a rarity. Even as Cannon continues his battle against wasteful spending at the LSC, other congressmen are discussing how much to increase the agency's budget. A few weeks ago, Senate appropriators cleared a bill to add $31.5 million to the LSC's budget for FY 2007. Their counterparts in the House have recommended a $25 million increase.
These are curious actions for a Republican-led Congress when you consider that 25 years ago President Reagan tried repeatedly to eliminate the LSC altogether. Reagan rightly claimed that the agency was engaging in inappropriate political advocacy. In 1980, the LSC tried to defeat Proposition 9 in California, which would have lowered state income tax rates. It also filed lawsuits against several state governments to force them to pay for sex-change operations.
But there were other controversies during that time period. For example, in 1983 an affiliate of the LSC charged more than $10,000 for car and limousine services for his commute between Washington and a nearby Maryland suburb. There were suspicious purchases, as well, including $15.5 million in real property and $17.8 million in equipment between 1980 and 1982. These examples are eerily similar to the extravagant purchases of today and should set off alarm bells on Capitol Hill. Unfortunately, in these free-spending days, that's unlikely to happen.
While it's encouraging to see members of Congress providing some oversight of the LSC, most lawmakers have resigned themselves to increasing its budget and hoping it doesn't spend too much on limousine rides and trips to Hawaii. How times change.
Brandon Arnold is director of government relations for the Cato Institute, Washington, D.C. Distributed by McClatchy-Tribune Information Services.