THIS MONTH’S COVER STORY chronicles the emergence of Texas A&M as a major academic university. This is great news for Texas. It would be even greater had it not been overshadowed by a campus scandal that was developing at the same time. For the past several years, Texas A&M has been the target of a criminal investigation into ethics and management practices at the highest levels of its administration. Ross Margraves, the former chairman of the board of regents, and Robert Smith, the former vice president for finance and administration, have been convicted of criminal offenses. If it seems strange to praise Texas A&M at the same time that so many are finding fault with it, one answer is that a new administration has confessed to A&M’s “institutional arrogance” and put reforms in place. Another is that there is much more to the scandal at Texas A&M than is readily apparent. The scandal is not about corruption at all. There was no corruption—no lying, no cheating, no stealing. This scandal is about public ethics, or rather our confusion as a society about what public ethics ought to be and how we ought to enforce them. Margraves and Smith may have used poor judgment at times. But that is not a criminal offense.

The investigation of A&M was triggered by an anonymous letter to Governor Ann Richards in September 1992. Over the typewritten signature of “A Concerned Aggie,” the letter accused Margraves and Smith of using privatization of the university bookstore and other functions “to be lavishly entertained and perhaps line their own pockets…”

The letter touched off a criminal investigation that would last more than three years. Its allegation of self-enrichment was never substantiated. But the investigation did uncover a see-no-evil management style at Texas A&M that was medieval in its obeisance to rank and privilege. Regents could fly around the state on university airplanes at will and have buildings named for themselves; administrators could make decisions without checks and balances or adherence to by-the-book procedure. Professors and employees ordered liquor for official functions under the guise of food and drink. Margraves and Smith did not create this system, but they did take advantage of it. Smith was convicted of soliciting a gift from a company seeking an extension of the bookstore contract, a misdemeanor; Margraves was convicted of official misconduct, a felony, for using a university airplane for a personal purpose. The two cases were tried in different counties, but the juries ended up with the same decision in each case: a guilty verdict, a fine, and a probated sentence. (Both men are appealing their convictions.) To the public, it must have seemed as if justice was done.

But it wasn’t. The massive investigation had turned up nothing crooked after all. The infractions that led to the convictions of Margraves and Smith occurred a year after the anonymous letter and were minor, technical, and ambiguous. What Robert Smith did that brought him before a jury of his peers was to accept, quite legally, a free trip to New York from Barnes and Noble, which won the bookstore contract—and then ask if he could bring his wife along. Margraves flew to Baton Rouge on an A&M airplane, met with Louisiana State University’s chancellor to discuss the possibility that A&M athletic teams might join the Southeastern Conference—and attended his son’s graduation. Their conduct might be ethically questionable, but it was not corrupt.

The Texas A&M investigation, then, might be dismissed as much ado about very little, except that it raises one of the central political themes of late twentieth-century America: What standards of conduct should we impose upon our public servants, and how should they be punished for failing to live up to our expectations? Richard Nixon brought the issue to the forefront, and Ted Kennedy, Gary Hart, and Ollie North kept it there. Our response to Watergate was to impose tighter rules for ethical behavior, and we have been tightening the rules ever since. But the intense focus on ethics has had an unpredictable effect: In our zeal to make certain that no ethical breach goes unpunished, we have created so many obscure requirements involving crimes that we have come to define the ethics of public service according to what is legal or illegal instead of what is right or wrong. All sorts of gotchas lurk in the rules. Jim Wright resigned as Speaker of the House and Newt Gingrich, Wright’s accuser, may yet have to do the same, but how many people could tell you precisely what either person did to go astray or whether the violation made Wright or Gingrich a less worthy public servant than he otherwise was? Laws are trump cards in the ethics debate; every law replaces a moral choice.

The anonymous letter was really a response not to corruption but to change, a sensitive issue at Texas A&M, where there is a tradition for everything. Margraves was a strong advocate of privatization. Smith, the administration’s contact with the regents, jumped on the privatization bandwagon. Margraves proposed putting the soft drink contract for the campus up for bids instead of automatically renewing it with the local Coca-Cola bottler; he favored bringing in a national chain to run the student center bookstore; he wanted a food court with brand-name franchises that would supplement the university food service; and he advocated building a cogeneration power plant with Tenneco, which would have been the most expensive capital project in the history of the university. The new contracts would bring in much more money for A&M, Margraves said, and up to a point, he was right: The soft drink and bookstore contracts each have increased A&M’s revenue by more than $1 million a year, and the food court has been a huge success. But by bringing in outsiders, Margraves made enemies of the well-connected local interests who were shoved aside. Smith had no shortage of enemies as well. He was a smart and tough administrator who became the deliverer of bad news for then-president William Mobley—an assignment that, by all accounts, he carried out with too much relish. If anything went wrong with Margraves’ and Smith’s plans, lots of people would welcome their fall.

And the cogeneration plant went disastrously wrong. Margraves and Smith bypassed the normal process of studying and contracting to handle the deal themselves, even though, according to the state auditor’s office, no one had determined how much the project would cost, how it would be financed, or even what the university’s true energy needs were. Consultants ran up bills in excess of $1 million without a contract. The project turned into a fiasco that the university canceled, and A&M was lucky to escape with some usable generating equipment and a net loss of $2 million.

Enter Bill Turner, the Brazos County district attorney. He represented the conscience of the community, and the community was clearly aligned against Smith and Margraves. In Bryan and College Station, Aggie students are popular, but Aggie big shots are not. Turner knew that A&M officials had been cutting ethical and procedural corners for years. Following the 1994 conviction of Smith, Turner told the Dallas Morning News, “In the whole scheme of things, keeping people on the right course, large groups of people, is extremely important. That is what this is about. It’s not about a violent, major threat to society. It’s about people maintaining a proper course of action.”

But is criminal prosecution the appropriate remedy for public servants who do not maintain “a proper course of action”? What about resignation (in the case of Margraves)? It was not enough. What about demotion (in the case of Smith)? It was not enough. What about repayment of any possible benefit? Not enough. What about public disgrace? Not enough. Turner’s view is the American view today, and it has been the view ever since Richard Nixon escaped prosecution with his resignation and subsequent pardon.

But society pays a price for criminalizing ethics—for stretching the criminal law to avenge poor judgment that is unaccompanied by evil intent. Criminal prosecution is a powerful act. It can ruin lives—if Margraves’ 1996 conviction stands up on appeal, he will be a convicted felon, unable to practice law—and set bad precedents. Is society really harmed if public officials are able to engage in personal activity while on a business trip, as Ross Margraves did when he attended his son’s graduation? Far more harm is likely to result by sending public officials to jail for dining with political supporters or attending an athletic event after doing the public’s business.

The fundamental issue is, Who ought to be responsible for running government? Should prosecutors and juries decide whether a trip is primarily for a public purpose or that a public official should have saved taxpayers’ money by taking a commercial flight (or, for that matter, Greyhound)? Less harm will be done and better government will result if the decision of whether tax dollars are spent wisely is left to the administration and regents of Texas A&M, however imperfect. The more that public officials are punished, the lower is society’s regard for public service—and the less attractive public service becomes to the ordinary citizen. Too much prosecution does as much harm as too little.