The Washington Post reported today that the SEC is issuing subpoenas to investigate the possibility that a “political intelligence” firm used congressional sources to gather insider information about health care funding, launching a surge of trading in health companies after the nonpublic information was made available to Height Securities, a stock brokerage firm.

Subpoenas, lengthy investigations and anonymous sources are one way to get to the bottom of whether some lucky investors used insider information from Congress to profit from timely stock trades. But here’s another thought. What if Congress enacted disclosure laws to help enforce rules against insider trading? What if political intelligence professionals were somehow required to publicly disclose their clients and the issues they are working on, the same way registered lobbyists have to publicly disclose information about their work? Seems like such disclosures might help cut to the chase, streamlining investigations and maybe even providing a check on the system to prevent the possibility of insider trading on congressional information in the first place. Too bad no one ever thought of that.

Oh wait. Someone did.

The original incarnation of the STOCK Act mandated disclosures by political intelligence professionals, and, in both the House and the Senate, had enough votes to pass. But even a majority in favor of greater transparency was not enough to save the political intelligence disclosure provisions. Even before their most recent slash and burn attack on the STOCK Act, which gutted the bill’s disclosure provisions, Eric Cantor bowed to pressure from Wall Street and stripped the political intelligence language from the bill before allowing it to come to a vote. Rather than holding firm on its own stronger version of the bill, the Senate simply took up the weaker House version.

And now the SEC is questioning Mark Hayes, a lawyer who served for seven years under Senator Grassley as Health Policy Director and Chief Health Counsel for the Senate Finance Committee. We don’t know the full extent of the relationship between Hayes and Height Securities, or whether Height had multiple sources feeding it information from Congress—mandatory disclosures would probably help clear that up—but an email from Hayes to a Height Security analyst said that a “high-level deal had been made that would provide a benefit to health insurers.” Soon after, the surge in trading on health company stocks began.

It often takes a scandal to convince Congress to act. Perhaps the SEC’s investigation will result in enough outrage that a bill providing disclosure of political intelligence activities can be signed into law.

Since resigning from Congress two years ago as a result of some seriously icky tweets, Anthony Weiner has cashed in on his congressional contacts to become another “stealth lobbyist,” earning enough from his corporate clients to move on up to a deluxe Park Avenue Apartment from more humble digs in Queens, all without registering and reporting who he is working for and what he is working on.

Shock and outrage (and some really amusing if not-ready-for-prime-time bits on the Daily Show) accompanied the former representative’s slimy use of social media. But there’s no shock or outrage accompanying his even slimier use of his former position for profit. Indeed, the New York Times seems to think Weiner’s secret lobbying on behalf of corporate clients somehow serves “as a compelling campaign credential” as he considers a run for mayor.

Rather than touting it as a career booster, Weiner’s stealth lobbying should be seen as still more evidence for the need to strengthen current lobbying disclosure laws. The only people in Washington who seem to support secret lobbying are the members of Congress who want to keep that lucrative career path open to themselves when they leave government service. For the rest, closing the 20 percent loophole that allows people like Tom Daschle, Newt Gingrich and now, Anthony Weiner to lobby without registering and reporting makes perfect sense from a transparency and accountability perspective. It is good policy for a junior lobbyist for a nonprofit organization, a mid-level associate for law firm and a named partner in a major lobbying outfit to register and report their lobbying activities. So why aren’t former members of Congress—some of the most powerful influence peddlers inside the Beltway—subject to the same disclosure requirements?

Only a few weeks after Weiner left Congress, he opened up his stealth lobbying shop. But the public became aware of his clients only after they signed waivers, at a time when the former Congressman decided to flaunt his assets (a recurring theme in his life?) declaring himself “a good capitalist.”

His prior “disclosures” on Twitter notwithstanding, Weiner’s most valuable asset may be his easy access to his former congressional colleagues. And although in some respects we have waaay too much information about the former congressman, we don’t know nearly enough about his work as a stealth lobbyist.

Parallel to our attempt to dig deeper into procurement transparency in the US, Sunlight started another big journey to map the global landscape of procurement norms and get a sense of how other governments disclose contracting information. We hope this will help us refine exactly what and how we shall advocate for within the US, but with our growing involvement in the international open government movement we also believe it`s high time to combine our efforts with other transparency advocates - such as the Open Contracting initiative - and push for globally applicable norms and standards around contract openness. (You can read more about developing data standards for open contracting from Tim Davies here.)

Needless to say, national (as well as subnational and local) procurement regimes are way too complex and fragmented to jump to early conclusions, but even at the beginning of our research it is crystal clear that government contracting is a hot issue everywhere - which seems pretty reasonable given the fact that procurement is a key policy instrument affecting a significant amount of national GDPs. But even more importantly, contract information is also seen as the possible linkage between other politically relevant datasets such as party finance data through shadow campaign financing, aid data, national budgets or absent information on companies.

From what we can tell so far, procuring is a huge mess. Thanks to the inherent complexity and the wide range of sectors, agencies and legislation affected, most national procuring systems are highly vulnerable to waste and fraud that occur in various forms such as bribery, favoritism, collusion or custom-tailored bidding. Even though waste may not necessarily be a result of malpractice, a significant amount of tax money goes into the global trash every day due to the lack of expertise, infrastructure or real competition caused by bureaucratic burdens, over-regulation or non-transparent legislations. Or a combination of these.

Just to make things even more complicated, each of the manifestations of corruption can occur in all stages of a procurement process from needs assessment through selection and awarding to the actual contract execution. And even if it seems reasonable enough to demand for greater openness in every stage (here’s a great study on how publication could improve the quality of government decision-making and both the quality and extent of  competition for contracts), there is an obvious tension between “fairness and transparency on one hand and flexibility on the other” which explains why specific authorities and sectors tend to favour more restrictive and less competitive procedures while still acting in good faith.

For us it seems that the international norms designed to guide national legislatures and procurement agencies through the labyrinth of government contracting processes are way too obsolete to meet the requirements of our technology empowered democracies. The main international agreement related to public procurement, the Government Procurement Agreement of the WTO entered into force in 1996 (!) and has not been revised ever since (though there’s strong political will to renegotiate the original agreement). Therefore it cannot respond to recent challenges. Even in the EU - where the legal framework for public procurements is also being reviewed currently - there are serious legislative loopholes and weaknesses and the degree of competition in public procurement “varies dramatically” between different member states.

We have no intention (or capacity) to address all the possible factors that make government procuring such a corruption-prone process. At this stage Sunlight is focusing solely on data disclosure practices. Our aim is to map how procurement information is published in other national legislatures, how timely, complete and machine-readable procurement data appears to be in different countries, who are the most progressive and transparent players in the field and what are the best civil society tools out there that help the public access, analyze and digest information about government contracts.

But even that is hard to tell. Information about procurement disclosure systems is scarce and fragmented and national laws change rapidly. Out of the 48 countries with delivered commitments to the Open Government Partnership, 24 national action plans - available in English - have a hint at procurement reforms. That does not mean all the commitments are potentially groundbreaking (more on the actual commitments in a future post) but the rate is especially striking when compared to proposed reforms on other key information such as party or campaign finance data.

So how do other countries perform? According to the most recent OECD report though many member states have come a long way in disclosing information about procurements, progress is slow and there are still only a handful of countries that monitor the actual performance of procurement systems and processes based on data and benchmarks while the level of transparency is still limited in the contract management phase. Another assessment of the EBRD region shows that some countries, such as Albania, Armenia, Estonia, Georgia, Latvia, Lithuania, and Turkey have advanced in the development of e-Procurement solutions for public contracts and are achieving very impressive results, however the OECD study warns us that only a few countries publish information about events that occur post-award and thus allow the tracking of procurement spending.

In order to make information about data disclosure policies and practices accessible we created a master spreadsheet. The sheet is public (though not editable) and available here:

https://docs.google.com/a/sunlightfoundation.com/spreadsheet/ccc?key=0AhECmY-CLA1hdHQ4STNKcEpoSS1RaHZ4YWFnNUxGZ2c#gid=0

And now we need your collaboration. Is information about your country’s procurement disclosure practices in the OECD report correct? (We have already found some discrepancies in the report.) If info is missing or incorrect, what is the actual publication practice? (For guiding questions, see the sheet.) Is there a case study - most preferably in English - that gives a good overview on how contracts are published in your state? Are there any open source civil society tools that use procurement data? Does your country have any suspension/debarment procedures? Is there anything else we should ask? Please contact us to verify information about your country at jkeseru@sunlightfoundation.com or klee@sunlightfoundation.com.

This is a first post in a series exploring international procuring trends. In the next few months, we’re planning to write more about citizen oversight mechanisms, the role of crowdsourcing in contract monitoring, open source tools that increase access to procurement information and also plan to give a more in-depth analysis on the OGP commitments.

It’s now been two weeks since the Congress quietly gutted the STOCK Act by severely limiting the legislation’s reach, exempting all legislative and executive staffers from the online disclosure requirements designed to prevent insider trading by members of Congress and their staff.

So I was intrigued this week to stumble on a 2010 article written by four economists entitled “Disclosure by Politicians” in the American Economic Journal: Applied Economics. The paper, based on detailed data on financial and conflict disclosure of members of Parliament in 175 countries, comes to this conclusion: "Public disclosure is associated with better government even with various controls. The privacy of politicians may have benefits, but those may come at the cost of lower accountability."

The authors (Simon Djankov of the World Bank, Rafael La Porta of Dartmouth’s Tuck Business School,  Florencia Lopez-De-Silanes of EDHEC Business School in France, and Andrei Shleifer of Harvard) are quick to note that they cannot tell a causal story – it’s not clear whether public disclosure of assets leads to better government (which they measure using several indexes: a corruption score, a government effectiveness score, the cost of doing business, the government expropriation risk, and political participation measures). But the two are clearly correlated.

As they note: “We cannot interpret the correlations we present causally, but they are suggestive that disclosure might be a significant ingredient of a broader system of political accountability.”

In addition to revealing this correlation, the paper also provides some valuable descriptive data of the state of asset disclosures across 175 countries. They note that of the 175 countries, only 46 require members of parliament to make all required disclosures publicly available and without conditions.

The paper does not discuss executive branch or staff-level disclosures. However, given the important role that modern legislative and executive staffs play in policy formulation and decision-making, they are in many ways extensions of the legislators and executives and there is a strong case for treating them that way.

And while the economists are careful not to make a causal inference, the power and logic of the relationship speaks for itself. That better disclosure correlates with a host of other positive measures of government efficiency is hardly surprising – less secrecy means less opportunity to get away with decisions motivated purely by personal gain.

Yesterday’s Supreme Court decision to uphold states’ rights to limit public information request to in-state requests, will likely hamper access by journalists and citizens to government information in certain states. To mitigate potential difficulties to access information in Alabama, Arkansas, Delaware, Georgia, New Hampshire, New Jersey, Tennessee and Virginia, MuckRock is seeking volunteers to serve as citizen co-filers from these states. MuckRock (a former Sunlight grantee) is a free service that serves as a FOIA proxy to request public records and creates a community database of FOIA-ed documents. In particular, our friends at MuckRock tell us they need the most help in Delaware.

Don’t let government transparency be limited by state lines, sign up to help!

To see an example of where the ability to file a local request in another state was critical to uncovering a special local interest, take a look at this story MuckRock unearthed in the FOIA process on drone documents.