By: Carson Hicks

The New York Times published an article last month describing a “revolving door” system between the Department of the Treasury and several top accounting firms.[1]  It outlined nine specific instances where insiders, mostly lawyers from firms such as Deloitte and PwC, took senior regulatory positions in Treasury’s tax policy office, only to return to their former employers after a year or two.[2]  Since 2000 there have been at least thirty-five similar round-trips from accounting firms through the same office, as well as the IRS and the Congressional Joint Committee on Taxation, where raises and promotions were waiting for returning officials.[3]

These officials have had a hand in all levels of tax policy, ranging from relatively obscure rules to the infamous Tax Cuts and Jobs Act of 2017,[4] allowing the returning bureaucrats to help their firms and clients exploit the tax code.[5]  A good example is the American Jobs Creation Act of 2004, which included a provision written by a former PwC partner that allowed for ridiculous deductions under the guise of manufacturing, like restaurants “manufacturing” slices out of a whole cake and sports teams “manufacturing” television entertainment.[6]  The author of the manufacturing deduction returned to PwC in 2006, but his work cost the IRS an estimated eighty-one billion dollars by just 2013.[7]  The Tax Cuts and Jobs Act ultimately repealed the manufacturing deduction,[8] but was written to allow around $1.3 trillion dollars in the form of tax cuts and expenditures to bypass small businesses by 2027,[9] decreasing their ability to compete with large multi-national corporations and resulting in a consolidation of economic power.  Decline in competition was a reason cited by the Biden Administration in a July executive order which directed the executive agencies, including the Department of the Treasury, to “promulgate rules that promote competition” and forms a counsel of the cabinet secretaries to a counsel tasked with scrutinizing Wall Street and Silicon Valley.[10]  Imbalances in economic power have been greatly exacerbated by this revolving door system, and there are several ways that the Biden Administration can combat its effects pursuant to the executive order.

The federal government and Treasury Department have existing regulations covering conflicts of interest[11] that many officials who have gone through the revolving door claim they have not violated.[12]  For instance, the top international tax offical at Treasury during the Trump Administration and a PwC partner, Chip Harter, denies that he met with PwC officials during the required “cooling off” period,[13] although he did meet with corporate lobbyists during his time at Treasury.[14]  Enforcement of these regulations are largely left to Treasury itself, through its ability to impose sanctions including termination and disqualification from future government employment.[15]  While these sanctions might be effective for career bureaucrats, the threat of termination  might lose their edge for offical that knows promotions and bonuses are waiting for him in the private sector.

President Biden has given Treasury the power to make these regulations more pointed and effective under their broad mandate to “promulgate new rules to promote competition.”[16]  Treasury could seek to mitigate what the leaving officials gain by promulgating rules imposing heavy fines for ethics violations and could impose a cooling period of more than two years, independent of the one required by statute.[17]  However, given the pervasive nature of the revolving door problem, it might be better to look beyond Treasury for regulation of the revolving door.[18]  Requiring independent ethics investigations by independent authorities, like the Department of Justice or a Congressional Committee, might be more effective at finding and stopping private sector actors seeking to mold the tax code for personal gain.  Another independent authority that can be effective is the legal community itself, of which many of these officials are members.[19]

The American Bar Association (ABA) already has conflict of interest obligations for lawyers and attorneys codified in its Model Rules of Professional Conduct.[20]  The ABA has the authority to enforce these rules to preserve the integrity of the legal community,[21] and should use the disbarment to regulate revolving doors.  Further, the ABA should combat this problem at the institutional level by requiring more comprehensive ethical training and stricter examination for aspiring lawyers in order for schools to achieve accreditation.  The remedy must start with institutional change and stricter self-governance because ABA has ethical obligations to maintain the integrity of the legal profession by preventing private sector lawyers from perpetuating economic inequalities through a revolving door system.


[1] Jesse Drucker and Danny Hakim, How Accounting Giants Craft Favorable Tax Rules From Inside Government, NY Times (Sept. 19, 2021),

[2] Id.

[3] Drucker, et al., supra note 1; Andrew Ross Sorkin, et al., How Tax Giants Write Their Own Rules, NY Times (Sept. 20, 2021), (pointing out that half of the induviduals mentioned above were made partner upon return, which can pay up to $1 million annually); see also Open Secrets, Revolving Door, (last visited Sept. 25, 2021) (Revolving Door database of officials that have rotated in and out of the public and private sectors, including names, titles, and dates of employment for officials who rotated in and out of Treasury).

[4] Drucker, et al., supra note 1.

[5] See Anne Bryson Bauer, We Can Do It? How the Tax Cuts and Jobs Act Perpetuates Implicit Gender Bias in the Code, 43 Harv.. J. L. & Gender 1, 38-40 (2020) (explaining that while the Tax Cuts and Jobs act did cut the corporate tax rate to 20%, the rate decrease did not apply for over half of the small businesses in the U.S., disproportionately women and minorities, and solidified the economic advantage of large corporations); see generally Caroline Bruckner, Doubling down on a Billion Dollar Blind Spot: Women Business Owners and Tax Reform, 9 Am. U. Bus. L. Rev. 1, 18 (2020) (discussing the lack of representation for small businesses on the Congressional Committees responsible for drafting the Tax Cuts and Jobs Act).

[6] Ryan Grim, PwC’s Other Debacle: A Tax Boondoggle That has Ballooned Out of Control, HuffPost (Mar. 2, 2017, 4:04 AM),

[7] Id.

[8] 26 U.S.C.A. § 199, repealed by Tax Cuts and Jobs Act of 2017, Pub. L. No. 115-97, Title I, § 13305(a), 131 Stat. 2126.

[9] Bauer, supra note 6, at 38.

[10] Executive Order 14036, 86 Fed. Reg. 36987 (July 9, 2021); see also David McCabe and Jim Tankersley, Biden Urges More Scrutiny of Big Businesses, Such as Tech Giants, NY Times (July 9, 2021) (explaining reasoning by the Biden Administration for wanting to more closely scrutinize Wall Street and Silicon Valley).

[11] 18 U.S.C. § 207 (2018); 31 C.F.R. § 31.212-8 (2011).

[12] Drucker, et al., supra note 1.

[13] 18 U.S.C. § 207(d) (2018) (requiring a two-year “cooling off” period for very senior officials, including those within the independent agencies of the executive branch like Mr. Harter).

[14] Drucker, et al., supra note 1.

[15] 31 C.F.R. § 31.218 (2011) (allowing additional “imposition of any other remedy under the terms of the arrangement or at law”).

[16] Executive Order 14036, supra note 8.

[17] 18 U.S.C. § 207(d).

[18] See generally Open Secrets, supra note 3.

[19] See Drucker, et al., supra note 1 (discussing that of the nine induviduals given as examples, eight are practicing lawyers and attorneys).

[20] See Model Rules of Pro. Conduct r. 1.7-8 (Am. Bar Ass’n 2020).

[21] See Id. r. 8.5.

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