Money on the side

You might have heard there was a little news out of Washington, D.C., this week. One of the legal eagles for the president made the papers. Controversy ensued. The left cried foul. Press releases came out by the dozens.

And you might not have heard about it. Not with all the other noise in Washington these days.

But this is not an unimportant matter: Jeff Sessions, the attorney general of the United States, has ended the practice of big companies and banks settling cases by giving money to special interest groups. At least he's ended the practice for now. The next time a Democrat takes the White House, it could all change back again. But this is another example of an embattled president at least having an experienced and capable Cabinet around him. (He may need it now more than ever.)

For years, whenever a Citigroup or a Bank of America or even a Volkswagen found itself in a tight spot with American regulators, the government and even the public, and was forced to settle a lawsuit or maybe just get the government to heel, it would negotiate a payment—a payoff— to some nonprofit or community group. To help ease things. Much like a bribe to a local pol helps grease the tracks elsewhere.

When the Obama administration was new, for example, big banks paid billions in penalties for their sins before the 2008 financial crisis. But millions of those dollars were set aside for politically connected groups.

Not any longer, not while Jeff Sessions is the AG.

"When the federal government settles a case against a corporate wrongdoer, any settlement funds should go first to the victims and then to the American people— not to bankroll third-party special-interest groups or the political friends of whoever is in power," he said Wednesday.

Imagine that. Settlement funds going to the victims. We'd suggest that the victims be the only recipients of settlement money, because even if the government took the money there'd be potential conflicts of interest and abuse. As there is frequently in a government operation.

When the previous administration ran Justice, it required banks to pay millions to outfits that specialized in housing counseling, community development and legal aid. Think Habitat for Humanity and the National Urban League. Imagine how many community organizers got big paychecks when those deposits were made. Then Congress began looking into things, and the House Judiciary Committee nailed down $880 million, at least, paid to third parties in a recent two-year period.

The Los Angeles Times put it this way: "The Obama administration defended the grants as a way to channel resources to help communities and groups hardest hit by the housing bubble and financial crisis. Nearly $400 million from the Bank of America settlement went to a group called Interest on Lawyers Trust Accounts, which distributes funds to legal aid groups across the country."

Nearly $400 million. To an outfit called Interest on Lawyers Trust Accounts.

The Los Angles Times also called General Sessions' decision more proof that there's a rightward shift at the department. To which We the People can only give thanks.

The next step should be for Congress to pass legislation outlawing the practice of paying off politically connected groups in this way. Republican lawmakers have introduced a bill doing just that. And such a law would make it more difficult for the next AG or administration to change back to the old scheme of doing things. (They'd at least have to pass another law to switch again.) The government shouldn't be in the position of extorting money from taxpaying businesses. And the executive branch certainly shouldn't be in the position of going around Congress to fund its favorite political groups.

A rightward shift? Let's hope it continues.