restrict the employment opportunities of those who do leave government by retirement or resignation.

Otherwise, serious

We believe that the proposed alternative administrative, civil and criminal penalties may all be justified. However, we suggest that the government be required to choose one remedy for actions which they believe inappropriate to pursue that remedy, and be restricted from imposing anyhers. constitutional rights could be infringed upon if an employee was forced to defend himself in an administrative action, and then subsequently in civil or criminal proceedings. In addition, as the Department of Justice and agencies pointed out to the General Accounting office in 1987 as part of the GAO report on the process of handling conflict of interest allegations (GAO 87-83 BR), it appears that reducing the criminal penalty from a felony to a misdemeanor might be a better enforcement tool than leaving the criminal penalties as they currently are, or increasing them. If Congress insists on more stringently restricting the post-employment opportunities of career executives, we think Congress ought to be willing to pay to compensate those upon whom the limitations have been placed. thing, denying employment is another.

Ensuring integrity is one
Career executives, for the

most part, are culminating 25 and 30 years in government when they leave. They started at lower level jobs and devoted their entire working careers to public service, often with substantial financial and other penalties for themselves and their families. The government's response now is to restrict what they can do

when they leave, rather than reward them with a golden handshake "as is" common in the private sector. It does not seem unreasonable to request that the country compensate executives in return for the restrictions placed on them. We therefore suggest that for the period when these officials are restricted from certain employment, that they be paid a percentage of their last salary in compensation by the government. We believe that a 50%

salary payment for the one year or 18 month period of restriction is reasonable, and we request that the Committee consider including such a provision in any law enacted.

Thank you very much for this opportunity to present our views. We would be happy to answer questions you might have.

Mr. FRANK. Thank you. I think the way this morning has evolved, many of us have been led in the general direction where you are. I would ask both of you particularly to help us with what I asked Mr. Lazarus to help with, which is to the extent that we can get good language that keeps you from-let me put it this way.

With regard to the people below, certainly, the presidential appointee level, I think the issue is inside information; it is not the over-awing personal relationships. What happens, I think, is the higher you go in the Government, the more personal things get and the less you know anyway, so it is less inside information and it is more personal relationships.

To the extent that you can help us to deal with the right language to deal with the inside information-I mean, these two kind of merge together-and the nexus notion, that will obviate a lot of these other problems. I do not sense that there is a lot of support here for going as far as the Senate bill in that regard.

Mr. Morrill, let me invite you, in particular-Ms. Bonosaro, you are welcome, too-to not forget us, because next year I think we are going to look at the disclosure stuff and see whether we areand you make a good point about enforcement. I think that you may very well impinge on your ability to enforce this at the highest level where you are worried about burying the enforcers in too much paper processing and they just cannot focus.

If the prosecutors-I mean, we are going to have to set up a whole Justice Department just to deal with that. But those are very important issues as far as I am concerned. Yes, we do want to prevent people from having their specific knowledge-not the general knowledge, but the specific knowledge, and we will take some help on that.

Mr. Smith.

Mr. SMITH. Thank you, Mr. Chairman.

Mr. Morrill, I have a question for you in regard to a statement you made on page 6 of your submitted testimony. You refer to a never-ending stream of actions to try to keep public organizations and public managers from doing wrong. "What, in fact, we may be achieving is keeping those organizations and managers from doing anything at all, and that is not a climate to attract high-quality people; indeed, quite the opposite."

We have had a number of individuals agree with you on that score today, but I want to ask you specifically for the record, do you think that S. 237 would, in fact, have an adverse impact on the recruitment and retention of high-caliber government employees? Mr. MORRILL. Yes, I do.

Mr. SMITH. That is an easy answer. I will not push that.

Ms. Bonosaro, if I could ask you a question in regard to page 3 of your testimony, you mention this: "There have been a total of only six cases referred to the Department of Justice for alleged violations of Section 207 of Title 18 in a two-year period by ten major Government agencies. These statistics are not indicative of a Government gone wild with post-employment criminal activity by career employees.'

My question is do you feel that there is a need to apply ethics legislation to the Legislative Branch, and if so, why?

Ms. BONOSARO. Well, as you noted, we carefully confined our testimony to the career executives in the Senior Executive Service. I think we have a concern, as do a lot of people, about effective, efficient running of the Government and the American people's confidence in it, and so we are sympathetic to the concern to include Members of Congress.

Clearly, we have heard a great number of issues raised today that present questions as to how you draw that language so that it is effective and it accomplishes something other than suggesting simply that the Congress is aware of this and we are taking care of it, even though we know it may not work very well or make much

sense.

Mr. SMITH. In other words, you see a need, but you are not going to recommend a particular way to accomplish the goal?

Ms. BONOSARO. No, we're not. Our initial reaction was that we thought that the restriction should be the same as for the Executive Branch, but I think clearly it needs a careful look.

Mr. SMITH. Mr. Chairman, I feel that we have made much progress today, and specifically I think we have learned a lot about S. 237. Frankly, I find it absolutely incredible that as we heard confirmed today, S. 237 as written would prevent a President from asking his predecessor for advice or from seeking advice from his predecessor's Secretary of State or Defense.

But I want to say that I consider it to be very significant based upon the testimony that we have heard today that given the great variety in panelists' backgrounds and the wide diversity in organizations represented, there is still general agreement on the need for ethics legislation to apply to the Legislative Branch.

Furthermore, I think it is significant that six of the seven panelists strongly recommend that a nexus of some type exist between any prohibited activity and the actual Government experience of the former employee. This is a sure foundation upon which to construct a meaningful, effective, and fair ethics bill.

Such a bill would apply post-employment restrictions to the Legislative Branch, establish a connection between the Federal employee's job responsibilities and potential opportunities for abuse, and provide for a continuing exchange of talent between Government and the private sector.

Mr. Chairman, that description might sounds familiar, since it happens to describe the Ethics in Government Act of 1988. As we have previously discussed, I look forward to further consideration of that bill by this subcommittee.

I thank you, Mr. Chairman, again for scheduling today's hearing on ethics legislation and for your continued interest in such an urgent issue.

Mr. FRANK. Thank you.

I just wanted to ask one last question to both when we are talking about the members because one of the things that I think is relevant is at our level we are talking about branch-wide and I want to anticipate criticism, because under the bill I would like to see former members allowed to lobby the Executive Branch.

My sense is that having put up with members when we were members, in our former member capacity if we come strolling over

to either an assistant secretary or a member of the SES that there is not likely to be any undue influence, but maybe I misread that.

Mr. MORRILL. I think that is right, Mr. Chairman. One of the things I also did, I sat in the OMB job that worried about the water resources projects at the appointed level and I saw a lot of members and former members. I think former members would not bother us at all.

Mr. FRANK. No. As a matter of fact, I think my own sense of ethics would incline me to warn prospective clients if I were ever in such a situation that there were probably people-Mr. Lazarus, let the record show, is nodding his head yes-that there were probably people all over the Executive Branch waiting to get even and it would probably not be a good idea to hire me.

But, Ms. Bonosaro, would you respond?

Ms. BONOSARO. I agree. I think that people in the Executive Branch are perfectly capable of sifting through and perhaps giving the courtesy of a hearing, too, but then understanding what to take seriously and what not.

Mr. FRANK. Not being over-awed.

Ms. BONOSARO. I would like to add one point, if I may, though, to the concern about who we are going to be able to attract to Government because I think we have two problems. One is certainly our ability to keep the career levels functioning.

We know already that GS-15s, many of them, do not want to go into the Senior Executive Service. They have little incentive to do so for a variety of reasons. Clearly, what we do in this arena potentially adds to their reluctance.

But, in addition, with regard to the non-career appointees, recent studies have shown that one of the major reasons that senior executives are leaving is over concern about the qualifications and abilities of the non-career appointees, and, to the degree that we make it harder and harder to come into Government, do a good job, and be able to leave again, that is just going to continue to exacerbate the problem.

Mr. FRANK. Good point.

Ms. BONOSARO. So I think our concern is to come up with a sensible bill that is not going to throw the baby out with the bath water. Mr. FRANK. That is a good point, although I think all of us would agree that the major thing we ought to be doing is to pay you more, and one way to do that is either to pay ourselves differently or break that connection with ourselves.

My own view is-and I hope this will be coming-I like what former Assistant Attorney General Weld said. We should abolish honoraria and give ourselves a significant pay raise, in effect, cashing out the honoraria, getting rid of that whole set of problems, and that would also then give us the problem is we tie other people to our salaries and we allow our salaries to be supplemented and we do not allow theirs to be supplemented and then we get some problems.

Mr. Smith.

Mr. SMITH. Mr. Chairman, I will let you carry the increase in salary and probably will not go too far on that.

Mr. FRANK. Well, I think the public would be well served by getting rid