Was Milton Gwirtzman Right? Is He Still Right?
The February 10th Executive Order “pausing” FCPA enforcement mentions the following.
“The President’s foreign policy authority is inextricably linked with the global economic competitiveness of American companies. American national security depends in substantial part on the United States and its companies gaining strategic business advantages whether in critical minerals, deep-water ports, or other key infrastructure or assets.”
This is a fairly obvious statement that has long been true.
This post rewinds the clock to 1975 and highlights how Congress wrestled with the same general issues 50 years ago when enacting the FCPA.
Hail To The Chief
Today is Presidents’ Day.
This post highlights the roles of the Gerald Ford, Jimmy Carter, Ronald Reagan, William Clinton, and Donald Trump administrations in enactment and subsequent development of the FCPA and its enforcement.
The article “The Story of the Foreign Corrupt Practices Act” also contains a detailed overview of the roles of the Ford and Carter administrations.
Ford
After watching Congress investigate and hold hearings on the foreign payments problem for approximately nine months, in March 1976 President Ford issued a “Memorandum Establishing the Task Force on Questionable Corporate Payments Abroad” (see here).
1980’s Rewind
Many of the underlying issues addressed by President Trump’s recent Executive Order have been part of the Foreign Corrupt Practices Act “conversation” for decades.
In 1980, the Carter administration (President Carter signed the FCPA into law in 1977) sent a report to Congress prepared by the Secretary of Commerce and the U.S. Trade Representative titled ‘Report of the President on Export Promotion Functions and Potential Export Disincentives.’
In pertinent part, the report stated:
The FCPA Turns 47
Our favorite statute, the Foreign Corrupt Practices Act, turns 47 tomorrow.
In signing the FCPA into law, President Jimmy Carter stated:
“I am pleased to sign into law S. 305, the Foreign Corrupt Practices Act of 1977 and the Domestic and Foreign Investment Improved Disclosure Act of 1977. During my campaign for the Presidency, I repeatedly stressed the need for tough legislation to prohibit corporate bribery. S. 305 provides that necessary sanction. I share Congress’s belief that bribery is ethically repugnant and competitively unnecessary. Corrupt practices between corporations and public officials overseas undermine the integrity and stability of governments and harm our relations with other countries. Recent revelations of widespread overseas bribery have eroded public confidence in our basic institutions.
Selfish Foreign Policy Reasons, Not Altruism, Is Why Congress Enacted The FCPA
It is perhaps neither here nor there – nearly 50 years later – whether Congress in enacting the Foreign Corrupt Practices Act was motivated by altruistic, do-good intentions or selfish, foreign policy goals.
But then again, it is important not to reinvent history or look at historical conduct through rose-colored glasses. Indeed, there are numerous accounts of history that ignore what really happened in favor of accounts that sound better.