A day after former Minister of the Treasury Fernando Herrero and his wife resigned from their respective positions as public official and presidential aide over a property tax controversy, media outlets are reporting that the Director of Tax Collection has ordered an investigation into the private business dealings of the power couple.
The downward spiral for the former Minister and his wife started just days ago with an investigation launched by national newspaper La Nacion, and it continued earlier today with yet another investigation. This time the focus of the La Nacion’s journalists shifted to Procesos, Investigación y Asesoría CA, a private consultancy established by Herrero and Florisabel Rodriguez in the late 1990s.
According to La Nacion, the consultancy under-reported its earnings by as much as $100,000 in 2009. There may also be conflict-of-interest issues, as contracts granted to the consultancy came from government institutions and a political party prior to the couple’s resignation.
A Matter of Ethics
Ancient Greek philosopher Aristotle tackled the deeply intricate matter of ethics before approaching politics, but in doing so he also made sure that two matters were forever related to each other.
At the end of his Ethics treatise, Aristotle posited that the inquiry into ethics necessarily follows into politics, and the two works are frequently considered to be parts of a larger treatise, or perhaps connected lectures, dealing with the “philosophy of human affairs.”
For the reason cited above, many publishers of Aristotle’s classical collection bundle Ethics and Politics together. In the former Minister’s case, the two apparently disconnected.
One look at the publications and staff of the consultancy operated by Herrero and his wife reveals a large staff and an interdisciplinary approached to consulting; a think-tank, in essence. The works of Procesos, Investigación y Asesoría CA range from Constitutional Law to voter’s rights, and from pedagogy to taxation. A lot on taxation.
The excerpt below comes from a paper titled “From Growth to Development: The 21st Century Challenge“, (PDF) authored by both Herrero and his wife in 2006:
“The high level of public debt and the budget deficit make it almost impossible to finance public investment using government funds, whether they come from tax revenue or bonds, which necessitates finding innovative funding from the private sector and contracts. […]
These private mechanisms would eliminate the problem that the sociopolitical structure in Costa Rica has prevented by not allowing the burden of taxation to increase. Participation from the private sector in different stages of public projects would allow their execution by levying fees on its beneficiaries, with minimum financing from revenue.”
In the excerpt above, Herrero and his wife support the idea of privatizing public services and making the public pay for them, while the government collects revenue from the private contracts.