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“How ‘Public Servant’ Hastert Got His Riches”: An Indictment Of D.C.’s “Revolving Door” Money Culture

Not-so-frequently Asked Questions About the Hastert Indictment.

It’s clear that the indictment of Dennis Hastert has raised more questions than it’s provided answers. But I suspect a lot of people are asking the wrong ones. Hastert’s “misconduct” may turn out to be of sexually predatory nature, in which case talk of how much his reputation is worth is picayune compared the nature of the crime. But there are questions about what he did that are applicable to the entire industry he represents.

The most obvious question, that’s also the least relevant for most Americans: What is the “misconduct” that Hastert is alleged to have been trying to cover up?

This is an important question, to be sure, but indicting Hastert on the financial charges and lying to investigators rather than on whatever misconduct occurred seems to indicate that those charges were the best investigators could come up with. Presumably, if the misconduct was illegal, they’d have mentioned that—and indicted him for it. If the conduct was sexual abuse, as sources are saying, then the statute of limitations has run out. It follows that Hastert wasn’t paying hush money to stay out of jail, he was protecting his reputation.

A better question, and one that many Washington watchdogs leapt on quickly: How did Hastert happen to have enough money lying around that paying out $3.5 million was even within the realm of possibility?

Hastert’s ability to participate in the blackmail is, after all, itself a general indictment of D.C.’s “revolving door” money culture, in which former lawmakers move easily from government into lobbying. In Hastert’s case, the ability to profit off of one’s legislative position is especially galling: While in office, Hastert used the earmarking process to turn his investment in some Illinois farmland into a profit of 140 percent when a federal highway project just happened to make its way through those very fields. Indeed, it was this instance of a completely legal form of insider trading that helped prompt Congress to end earmarks.

And, of course, Hastert made even more money once he was out of office. One study found that, on average—and when the information is publicly available—former lawmakers get a 1,425 percent raise when they make the jump from Capitol Hill to K Street. Hastert, who was worth between $4 million and $17 million when he left Congress, was making $175,000 as a representative. His K Street bump would be to almost $2.5 million a year.

Okay, he made his money as a lobbyist, doing presumably sneaky lobbyist things. That raises the next question: How can Hastert’s reputation even be worth $3.5 million?

Hastert is a former member of Congress known to have profited off of a shady land deal and he’s a registered lobbyist—these are already the two professions that Americans regard as the most disreputable careers available. They are literally last (lobbyist) and second-to-last (congressman) on Gallup’s list of what jobs Americans regard as “honest” and “ethical.” What would one have to do to be thought even less of?

Given the ickiness of what has been reported, it might not be good to think about that question too hard, so let’s turn that question on its head: What kind of reputation could be worth spending $3.5 million to protect?

To consider $3.5 million a reasonable sum to spend on protecting one’s reputation, presumably it has to be worth a lot more than that. And, indeed, in the context of the lobbying world, $3.5 million just isn’t that much money. Especially considering that Hastert was apparently making pay-offs over time. Special interest groups spent almost 1000 times that—$3.2 billion—in 2015 alone. If Hastert viewed protecting his reputation as a kind of investment in future earnings, $3.5 million is on the scale of buying an alarm system for your home, not buying a whole other house.

And, it’s important to remember, what Hastert was covering up with that hush money was not a “reputation” as an average citizen might conceive of it: something akin to honor or trustworthiness or fidelity. A lobbyist’s reputation, after all, actually hinges on his or her established lack of principles. A lobbying client for someone who is a former member of Congress is paying a premium for that person’s willingness to engage in barely-legal favor-trading. A lobbyist’s prices go up the more corrupt he is. Who wants to hire an honest one?

 

By: Ana Marie Cox, The Daily Beast, May 30, 2015

May 31, 2015 Posted by | Congress, Dennis Hastert, Lobbyists | , , , , | 1 Comment

“So, Who’s Getting The Gigs?”: When The GOP Goes On A ‘Hiring Spree’

If you want to know where Congress is headed, it obviously makes sense to take a close look at elected lawmakers themselves.  But to understand how they intend to get there, you’ll need to understand who they’re hiring.

As Republicans get ready to take complete control of Capitol Hill, GOP officials are going on a “hiring spree,” especially in the Senate, where the new majority will have expanded staffs at both the leadership and committee level.

So, who’s getting the gigs? We can break them down into two broad groups of people. The first, as Anna Palmer reported the other day, are corporate lobbyists.

Lobbyists can come home again.

As Republicans take control of Congress, they are bringing in veteran influence peddlers to help them run the show. Nearly a dozen veteran K Streeters have been named as top staffers to GOP leaders or on key committees as lawmakers prepare to take the gavel in January.

And why would lobbyists leave better-paying jobs at K Street firms in order to tackle unglamorous work on Capitol Hill? Because as any good lobbyist knows, they can, when they’re done with their congressional work, return to K Street and demand even more money.

In the meantime, the line between corporate lobbyists and congressional Republicans has long been blurry, but the partnership will now be even stronger as the GOP takes over the Senate for the first time in eight years.

But they’re not the only ones getting new gigs in Congress. The other group includes Heritage Action staffers.

Heritage Action for America is losing three staffers, including its top House lobbyist, to a trio of newbies in the 114th Congress. […]

“One of the great roles of having a permanent 300-person institution is that people take what they learn here and spread that throughout the universe,” said Heritage Action for America’s CEO Michael Needham.

Depending on one’s perspective, that’s either very nice or very scary.

Regardless, taken together, staffing moves like these tell us something interesting about who’ll be doing the legislative legwork for the next couple of years.

 

By: Steve Benen, The Maddow Blog, December 22, 2014

December 24, 2014 Posted by | Congress, GOP, Jobs | , , , , , | Leave a comment

“In The Short Term, Absolutely Nothing”: Are GOP Donors Going To Get Anything In Return For Their Millions?

If you’re a liberal zillionaire who contributed lots of money this year to prevent a Republican takeover of the Senate, on Tuesday you’re probably going to be pretty unhappy. Which is why, Ken Vogel of Politico reports, the people who run the groups through which all those millions are being channeled are rushing to reassure their donors that it was still money well spent. Which got me thinking about the conservative donors who are probably going to be celebrating next week. For some of them, Republican victories are an end in themselves, but others have a more specific agenda in mind. They help Republicans get elected because they expect something in return.

To be clear, I’m not talking about quasi-legal bribery. If you’re an oil company or a Wall Street firm, you donate to Republicans not so that they’ll be forced to do what you want whether they like it or not, but because you know they like it quite well. Republicans want, deep in their hearts, to cut taxes and slash regulations and open up public lands to drilling and all the other things that would benefit their donors. But are they actually going to be able to deliver?

Those investments have been huge. Here are just a couple of details from the Center for Responsive Politics:

Wall Street as a whole has contributed $171.1 million, more than any other industry or interest group that CRP tracks. Of that total, $100.8 million has gone to candidates and party committees, with an overwhelming 62 percent of it winding up in the hands of Republicans and just 38 percent in the hands of Democrats. The remaining money, more than $70 million, went to outside groups, and $45.8 million of that went to conservative-leaning organizations.

But while securities and investment was the top donor industry for GOP candidates, for Democrats the No. 1 slot was occupied by lawyers and law firms. Overall, that was the third-ranking industry this election cycle, giving $66.4 million to Democrats and $28.4 to Republicans through the third quarter.

One grouping new to the top 10 is Environment—a category that includes a number of fairly small-spending groups like the Natural Resources Defense Council. What made the difference this year were contributions from Tom Steyer, a billionaire who made his money in hedge funds; he has contributed $73.7 million this cycle to outside groups, all focused on the environment or aligned with Democrats.

Steyer has said that his goals are long-term—specifically, he wants to elevate the place of climate change in public debate and elect people who will (eventually) do something about it. But if Wall Street has contributed over $100 million to Republicans this year, they want something in return. And what are they going to get? The answer is probably not too much. Republicans have no doubt been telling them, “Help us get elected, and then you’ll see!” But Barack Obama still has a veto pen, and the Treasury Department and the SEC are still staffed by his appointees (not that they’re unfriendly to Wall Street, but they’ll be no more friendly next year than they were this year). Republicans aren’t going to be passing any major legislation—or much legislation at all—that will actually reward their friends, because if the legislation they pass would meaningfully advance conservative goals, Obama would veto it.

But people all over the place may be overestimating just how much change is going to come. Look, for instance, at this article (also from Politico) about how all the K Street lobbying firms are getting ready for boom times:

GOP lobbyists and consultants are strategizing about landing new business and looking forward to advising clients if Republicans take control of the Senate—setting off rapid change in the political dynamics of Capitol Hill.

Several lobbyists said they expect a bump in business in the first half of 2015 when companies look to recalibrate their outside rosters to engage more heavily with Senate Republicans.

“There will be a burst of excitement and activity as a result of that change,” said former Senate Majority Leader Trent Lott (R-Miss.), who now heads Squire Patton Boggs’ lobbying operation. “There is a lot of pent-up demand in the tax area, infrastructure, immigration, the budget and tax policy.”

Lott said he thinks it will be a shot in the arm to K Street with a much busier legislative agenda.

Lobbyists need legislation in order to do their jobs. They especially like big bills that can be larded with lots of obscure provisions they obtain on behalf of their clients but that few people notice. And these have indeed been lean times—I have one friend who’s been lobbying for years, who told me not long ago that he was considering a career change, because without any legislation going through Congress, his job had become all but irrelevant.

But what the hell is Trent Lott talking about here? Is a Republican Congress going to start passing bills on taxes, infrastructure, and immigration that Barack Obama will sign?

Of course they won’t. What they will do, however, is write, debate, and maybe even pass a lot of bills that are ultimately doomed. Some will get filibustered by Senate Democrats, others may be vetoed. But at least Lott will be able to go to his clients and say that he earned his six-figure monthly retainer, because he got things inserted into bills for them, and it isn’t really his fault if they never actually became law.

And that’s what they’ll get for their millions, at least in the short term: nothing.

 

By: Paul Waldman, Contributing Editor, The American Prospect, October 31, 2014

November 1, 2014 Posted by | Campaign Donors, GOP, Megadonors | , , , , , , | Leave a comment

   

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