Is Oregon Afraid to Face Political Problems?

Wednesday, March 25, 2015

Joanna Evoniuk, GoLocalPDX Contributor

Oregon may have a problem when it comes to addressing political conflicts and corruption, some political experts say.

With Governor John Kitzhaber’s resignation from office last month and ongoing federal and state ethics investigations, Oregon State Representative Julie Parrish says Oregon can shy away from confronting underlying issues.

“There is a hesitance to hold up the mirror and say the bad actor needs to go,” Representative Parrish said. “It was really clear last fall and with Kitzhaber’s unraveling, but we saw it in the past with [Governor] Goldschmidt, Sam Adams, and others. It feels more like sweeping things under the rug than doing what needs to be done.”

As the current chaotic situation advances, political experts debate if Oregon’s treatment of elected officials and political problems is to partly to blame.

“They don’t want to deal with it and it makes them unconformable,” said James C. Foster, political science professor at Oregon State University. “Along comes a situation like Kitzhaber, and the first reaction is a shaking of heads in disbelief.”

Corruption in Oregon

Oregon has a relatively clean record from corruption. A 2014 study by Harvard ranked Oregon as one of the least corrupt states in the country.

Although Oregon may not have a brawler reputation for politics such as Chicago or Boston, political analyst Len Bergstein said the state does not back away from controversial issues.

“Oregon has a sense of brightness, but we don’t shy away from controversy,” Bergstein said. “We haven’t shied away from marriage equality or civil rights issues and in city government, people fight for their neighborhoods.”

Yet elected officials are not always so ready to speak up when it comes to questionable actions, according to Parrish. She said politicians on both sides of the aisle will voice concerns behind closed doors, but are afraid to speak publicly against their own party—a side effect from entrenched parties and political figures.

“When you live in a state with single party rule for years, red or blue state, it has potential to breed corruption,” Parrish said. “When we don’t have fresh blood at the executive branch, we create a circumstance where corruption becomes a part of how we do business.”

Conflicting Interests

A recurring theme in the recent tangle of political events is conflicting interests and roles. Aside from Hayes, other political placements by Kitzhaber have been questioned for conflict of interest, such as political consultant Dan Carol and advisor Tom Tuchmann.

In a recent development, The U.S. Attorney General investigating Kitzhaber, Amanda Marshall, left office on leave amid stalking allegations. Sen. Ron Wyden nominated Marshall for Attorney General, raising the question that perhaps more qualified or better-suited candidates were overlooked.

Parrish said Oregon politicians have a tendency to appoint committee members and staff based on the potential political gain, rather than professional motivations or qualifications.

“Kitzhaber’s staff was a revolving door. We need to stop making political hires, and hire based what Oregon needs,” Parrish said. “It’s all interconnected and goes back to 30 years of turning a blind eye.”

The Oregon political arena is a small and closely connected one. Bergstein said everyone seems to be related to someone, or a is few connections away from a close relationship with old friends.

“Oregon’s still a village in terms of political folks,” Bergstein said. “Here, people in the old political world care about the next level, and that breeds a sense of familiarity and forgiveness for minor transgressions.”

Bergstein said politicians generally conduct business with a family-like attitude--while they may go hard against each other on the important issues, they also are quick to make up. Citizens also feel personal connections to long-standing political figures.

In some cases, Bergstein said people might capitalize on Oregonian’s forgiving nature and use it for their advantage. Political campaigners and consultants may work their way through problems, hoping the public will forgive and forget, Bergstein said. However, Bergstein said these cases are more the exception than the rule.

Oregon Pride and Mentality

Issues with politics may come from Oregonians’ mentality, according to Foster.

“We’re always in a sense of denial, tied up with a sense of pride,” Foster said. “We see ourselves as different and special—immune to low level conflict and corruption like other states.”

Foster says pride in the state is a part of Oregonians’ identity, much like having no sales tax or not pumping your own gas. In past research exploring the possibility of the state adding a sales tax, Foster said they found the citizens wouldn’t adapt one due to a sense of pride of being one of the few states without one and suspicion of what the government would do with the new revenue.

It is the same pride and mindset that affects how citizens deal with politics, Foster said.

To move forward from the recent scandals, Parrish said the legislative assembly should commit to passing a bill that would open up the public records request process, as well as the three announced by Governor Kate Brown to improve political ethics and transparency.

Yet Foster doubts Oregonians’ attitudes toward politics will change overnight.

“The bumper sticker “Keep Portland Weird” will still be there,” Foster said. “I don’t think any situations with Kitzhaber will change the fundamental view that Oregon is unique.”

Related Slideshow: Feds Probe Kitzhaber and Hayes: 10 Things to Know

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It Could Cost Millions

Defense fees for a federal investigation will rack up quickly, more so if the investigation turns into a trial.

“The fees can be exuberant. You can’t do one of these cases for less than half a million dollars,” Solomon Wisenberg, a defense lawyer from Washington D.C. said.

These cases can cost around $2 million in legal fees, according to Wisenberg.

For example Robert Urciuoli, convicted in 2008 for federal charges of conspiracy and fraud in a case involving a former Rhode Island state senator, had $2.15 million for legal expenses.

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9.

FBI Resources

The FBI may have years of records to comb through, but they have the resources to do so—much more than a state criminal investigation would.

A federal investigation is given millions of dollars and a vast supply of manpower. Attorneys say the feds also have more expertise and experience in handling corruption investigations.

If there is something to be found, the FBI has the tools and time to look for it.

Photo: FBI Headquarters in D.C.

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8.

FBI Undercover Investigation a Possibility

Although a subpoena was delivered on Feb. 13, it does not mean the FBI has just started looking into Kitzhaber and Hayes. Joel Bertocchi, a white-collar criminal defense attorney in Chicago, said federal investigations often involve an undercover stage in the beginning.

Special agents are often recording information and meeting with people long before subpoenas are issued.

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7.

Mail Fraud, Wire Fraud and Corruption

Experts agree Kitzhaber and Hayes are most likely being investigated for breaking federal statutes of mail and wire fraud, as well as corruption.

Because Hayes may have used government resources for her personal gain, such as not disclosing conflicts of interest while using government phones or email services for her paid contracts and speaking appointments, it would fall under those statues.

Federal statutes have a broader reach of power than state statutes, according to Wisenberg, giving more options for prosecution.

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6.

11 State Departments Subpoenaed

In the subpoena from the U.S. Department of Justice to the Oregon Department of Administrative Services, a number of state departments were listed.

The following eleven departments are believed to have documents or records that are of interest to the investigation:

-The Office of the Governor

-Government Ethics Commission

-Housing and Community Services Department

-Oregon Department of Justice

-Department of State Lands

-Oregon Department of Revenue

-Department of Administrative Services

-Business Development/Business Oregon

-Department of Community Colleges and Workforce Development

-Department of Energy

-Department of Environmental Quality

Photo: Oregon's Department of Administrative Services was served a comprehensive subpoena into outgoing Governor Kitzhaber and his fiancee, Cylvia Hayes.

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Hayes’ Contracts are the Focus of the Subpoena

Records pertaining to Kitzhaber and Hayes, as well as a number of other individuals are listed on the federal subpoena. However, it appears Hayes’ contracts and dealings with energy groups are the focus of the investigation.

Federal investigators are requesting records involving private companies Hayes and 3E Strategies conducted business with, such as Demos and Clean Economy Development Center, as well as government projects Hayes was involved with.

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4.

Feds Focus on Cases They Can Win

If the federal government is moving forward with the investigation, it most likely means they have a strong case.

Like most prosecutors, Bertocchi said federal investigators focus on cases they know they can win.

“I don’t think anybody, unless they were nuts, would seek to charge a recently-sitting governor,” Bertocchi said. “It doesn’t mean they can’t lose, but you have to take them seriously.”

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A Grand Jury Will Decide to Indict Kitzhaber and Hayes

The documents and wittiness gathered by the FBI’s investigation will be presented to a grand jury of 23 Oregonians in a United States District Court.

Proceedings and information from the grand jury are supposed to be kept secret, but Bertocchi said sometimes the information is leaked.

After hearing the evidence, the grand jury will decided whether or not to indict Kitzhaber and Hayes and bring formal charges.

The grand jury will start procedings on March 10, 2015.

Photo: "The Jury" by John Morgan via Wikimedia CC.

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Federal Investigations Tend to Favor the Prosecution

Federal investigations tend to favor the side of the prosecution, according to Wisenberg.

The history of corruption in a state can also impact the jury. Bertocchi said in Chicago, where political corruption is a common theme, juries are more cynical and less likely to give guilty verdicts.

However, it might be the opposite in a state like Oregon, where big-time political corruption is more unusual, Bertocchi said. It is more likley the defense will have more convicing to do.

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It Could Drag on for Years

Even though the grand jury begins hearing evidence in less than a month, the final outcome could be years away. Tom Hagemann, who served as Assistant U.S. Attorney in Los Angeles, said a very document-intensive case like Kitzhaber and Hayes' could drag on.

If criminal investigations and proceedings do last years, it will make it difficult for Kitzhaber and Hayes to move on with their lives, or find a steady job.