Hotel industry blasts Obama ethics rule

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Just as the U.S. hotel industry begins to recover from the recession, industry leaders say they are being sabotaged by the Obama administration.

This post has been corrected. Please see note at the bottom for details.

The contention centers on a new rule proposed by Obama’s Office of Government Ethics that would prohibit most federal employees from accepting free admission to conferences and other gatherings hosted by businesses or organizations that lobby the government.

The American Hotel & Lodging Assn., the trade group that represents the nation’s hotels, blasted the proposed rule, saying it is unneeded and prevents federal employees from mingling with people to learn about trends and problems in the country.

On top of that, the trade groups says the rule will cut down on attendance to conventions, trade shows and other gatherings, mostly held in hotels. The group worries that the rule will hurt an industry that has just begun to rebound from one of the worst periods in decades.

“Hotels are often the sites for conferences and events that federal employees would be banned from attending, thereby creating a direct negative impact to our business,” association president Joe McInerney said in a statement. “This would have grave consequences for hotels, the economy, and the millions of workers our industry employs.”

In proposing the rule last month, the Office of Government Ethics said the agency proposed the rule because federal employees of the executive branch who get free attendance to an event, particularly a gala or a concert, receive a gift “that the employee will enjoy in the very company of the lobbyist.”
The rule would allow some exemptions, including events hosted by the media or nonprofit groups. The public has until Nov. 14 to comment on the rule by going to http://federalregister.gov/a/2011-23311.

Employees who violate the regulation can be demoted or fired.

[For the record, 4:03 p.m.: A previous version of this post said the proposed rule would prohibit most federal employees from attending conferences and other gatherings hosted by businesses or organizations that lobby the government. Rather, it would prohibit such employees from accepting free admission to such gatherings.]

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