Christopher Kutz

We do not yet know what and when the Treasury Department knew about the now-repaid AIG Financial Products bonuses. But the following is plausible: the traders in that unit had convinced their employer that their skills were so important to minimizing the damage to their company, or would be so dangerous in the hands of their competitors, that they were able to extract compensation at least as valuable as the year before, independent of actual performance or retention. Lawyers then drafted apparently bulletproof guarantees that these bonuses would be paid. Treasury, given legislative cover by Congress, saw the bonuses as a distasteful but necessary cost of minimizing the total losses taxpayers would have to bear. Public outrage at this “business necessity,” however, could scupper the entire bailout plan.

Here is another recent story: intelligence professionals asked to use a range of surveillance and interrogation techniques the law clearly prohibited. They were able to persuade their employers that they needed access to these techniques in order to protect national security. Their employers agreed, and asked lawyers to draft documents that purported to protect the operatives from any legal consequences. Their employers may have agreed because they felt hostage to any future attack, if it might be said that they failed to exhaust all options; or because they genuinely believed that these techniques were necessary to security. When the techniques and the enabling legal documents were leaked to the public, the scandal wrought enormous damage to the reputation of the employer, domestically and abroad.In both cases, secret or hidden arrangements allowed insiders to design – and lawyers to try to bulletproof — agreements that appear narrowly to serve immediate institutional interests, but that threaten grave harm when exposed to the whole enterprise. Certainly the bonus agreements, like the torture and surveillance policies, are distasteful on their faces. But secret lawyering compounded the problem, as well as the damage.

In the national security arena, President Obama and Attorney General Holder have already announced a preference for “transparency” and openness, and have made some important moves in that direction, for example by declassifying some of the most egregious Justice Department memoranda. But their progress has been fitful: DOJ lawyers have continued to insist upon the application of the “state secret” doctrine, which can prevent even meritorious challenges to government action from receiving a hearing. And the development of the successive Treasury bank rescue plans has been virtually as opaque as under the previous administration.

Inevitably, as the government confronts unprecedented challenges, there will be policy mistakes. But mistakes compound within the echo chamber of a small number of exhausted officials working 24/7, because anyone in such an environment comes to overvalue the skills and insights of the others in the chamber, while undervaluing the capacities of outsiders even to understand the problem; and because the tendency of such discussions is for all to focus on the concerns of a majority of the group while ignoring the others. “Groupthink” and “polarization” are psychologists’ terms for these phenomena.

While there must continue to be opportunity for fully confidential discussions as policy proposals are developed, there must be mechanisms for oversight as those proposals become actual policy. Two things would help.

First, lawyers must be reminded of their duties when they act as advisors rather than as courtroom advocates. Lawyers may not dictate policy, but they have a unique capacity to influence decisions, because they are typically brought into policy discussions early on, to gather the full range of options, and because they have an allegiance to the constraints of the law itself, not just the preferences of their client. When lawyers are advisors, especially within the government, they have a special duty to their clients to provide wide-ranging and critical advice. It is open – and expected in many other countries – for lawyers to say, “this proposal would be legal, but here is why it could be very unwise.” In the case of the AIG bonuses, both the private lawyers drafting the bonus agreements and the Treasury lawyers examining them later should have raised an alarm at “retention” “bonuses” that were independent of actual retention or performance.

Second, we should implement a check on the echo chamber effects: experts who can be brought into the discussion early enough before proposals become policy but late enough that they have not themselves become wedded to any particular proposal. The Vatican called these professional gadflies advocati diaboli, or devil’s advocates: lawyers brought into the saint-making process to offer counterargument. Senior White House staff are already too busy to pay attention to the array of policies emerging from the Cabinet. But a wide-ranging team of counter-advocates could be deployed to raise the full gamut of objections to the high impact policies coming out of the White House. Given the delays in fully staffing federal agencies, a multi-agency task force could also provide valuable efficiencies.

Neither of these proposals would prevent political errors from arising. But both would take us closer to the smarter, more open government President Obama’s election seemed to offer.

Christopher Kutz is Professor of Law and Director of the Kadish Center for Morality, Law and Public Affairs.

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