Alexandra Minsk (Stanford University) has posted Regulating Government Consultants: McKinsey and Conflicts of Interest (UCLA Law Review, forthcoming) on SSRN. Here is the abstract:
The opioid epidemic has killed hundreds of thousands of people and decimated many communities. Investigative reporters and litigation uncovered that the consulting firm McKinsey & Company helped drive opioid use through the advice that it gave to Purdue Pharma. To add insult to injury, while McKinsey was consulting for Purdue, McKinsey was also working as a government contractor for the U.S. Food & Drug Administration on opioids – all without violating federal ethics regulations.
Inspired by this case, I argue organizational conflicts that arise when contractors do government work are a serious and underappreciated worry. The emphasis in federal regulation is on the fairness of the procurement process itself. But a variety of conflicts of interest can arise during the performance of years-long contracts that do damage going far beyond increased cost, in part because conflicts of interest can undermine regulation.
Despite this substantial gap in the law, almost no scholarship considers the ethics rules that bind federal contractors. I suspect this is because these guidelines have thus far not been linked to broader debates in administrative law. This Article begins to draw out those connections by situating ethics rules within significant literatures that worry about the accountability of government contractors and the influence of private actors in the administrative state. It considers, in particular, the risks that come along with the use of an understudied kind of government contractor: consultants.
Ultimately, this Article seeks to redirect thinking about the regulations that bind government contractors towards worries about corruption. It offers a new framework for thinking about conflicts in the context of government contracting that emphasizes the risk that contractors might interfere with or have undue influence over regulation – two risks made vivid by McKinsey’s actions as a government consultant.
Recommended.
