An “Entangled Legacy”: The Sordid K Street Past Of Rick Santorum
Rick Santorum has received, and courted, plenty of comparisons with Mike Huckabee since his near-victory in the Iowa Caucuses, but not all of them have been earned. Yes, like Huckabee in 2008, Santorum has been heavily dependent on grassroots campaigning, with direct appeals to evangelical voters, and a veneer of folksy, blue-collar economic populism. But the comparison ought to stop there. What Santorum cannot match is Huckabee’s status as a genuine Washington outsider, someone untainted by the corrupt dealings inside the beltway. Indeed, Santorum’s record shows him to be deeply connected to the ethically unsavory and legally dubious world of DC influence-peddling.
Since losing his Pennsylvania Senate seat in 2006, Santorum has used his connections to land a series of highly-paid jobs. Consol Energy, a natural gas company specializing in “hydrofracking” and the fifth-largest donor to his 2006 campaign, paid him $142,000 for consulting work. He also earned $395,000 sitting on the board of United Health Services (UHS), a for-profit hospital chain whose CEO made contributions to his Senate campaigns and which stood to benefit from a big hike in Medicare payments Santorum proposed in 2003. (Incidentally, the Department of Justice sued UHS for Medicare and Medicaid fraud during Santorum’s four-year tenure on its board.) Santorum also earned paychecks from a religious advocacy group, a lobbying firm, and a think tank. For pushing legislation benefitting UHS and several other companies, one ethics group named Santorum to its “most corrupt Senators” list.
Santorum has made his post-Senate career doing the sort of quasi-lobbying that helped sink Newt Gingrich’s campaign in Iowa. But in fact, while still in office, he was a central actor in an even more sordid venture: The K Street Project. Started in 1989 by GOP strategist Grover Norquist and brought to prominence by former House majority leader Tom DeLay in 1995, the K Street Project was a highly organized effort to funnel Republican Congressional staffers into jobs at lobbying firms, trade organizations, and corporations, while attempting to block Democrats from those same posts. From 2001 until 2006, Santorum was the Project’s point man for the Senate, while House Majority Whip Roy Blunt manned the House side.
In 2006, the K Street Project was effectively forced to shut down amid public outcry; the following year, an ethics reform law made such outfits illegal. But in its heyday, it helped create an unprecedented revolving door between the White House, Congress and K Street, blurring distinctions between Republican policy and corporate welfare. As Elizabeth Drew put it in a 2005 New York Review of Books piece, “Democratic lobbyists have been pushed out of their jobs as a result; business associations who hire Democrats for prominent positions have been subject to retribution. They are told that they won’t be able to see the people on Capitol Hill they want to see.” Nicholas Confessore, in a groundbreaking 2003 Washington Monthly expose of the Project, detailed the goal bluntly: “First, move the party to K Street. Then move the government there, too.”
At the center of all this was Santorum. According to Confessore, Santorum conducted weekly breakfasts with lobbyists, and occasionally Congressmen and White House staff, during which he attempted to match Republican Hill staffers with K Street job openings. As Confessore put it, “Every week, the lobbyists present pass around a list of the jobs available and discuss whom to support. Santorum’s responsibility is to make sure each one is filled by a loyal Republican—a Senator’s chief of staff, for instance, or a top White House aide, or another lobbyist whose reliability has been demonstrated.” The group refused to meet with Democrats, and threatened sanctions against lobbies that did.
Revolving door tactics, until then de facto lobbying policy, were formalized and transformed into a “pay to play” system by the K Street Project. In 2003, after the top post at The Motion Picture Association of America went to a Democrat instead of a Republican, House Republicans reneged on an impending tax break, hitting the movie industry with a $1.5 billion bill. After the Democrat was chosen, Roll Call reported that “Santorum has begun discussing what the consequences are for the movie industry.” (Santorum, though he often denies his involvement in the K Street Project, more or less confirmed his involvement in the MPAA flap.) Later that year, the Washington Post revealed that the House Financial Services Committee pressured a consortium of mutual funds to oust a top lobbyist who was a Democrat in exchange for relaxing a pending investigation. After the smoke cleared, she was replaced by a Republican.
Whether the K Street Project was truly successful is up for debate. Confessore and Drew’s reports portray intimidated and marginalized Democratic lobbyists. According to a 2003 Washington Post story, a Republican National Committee official boasted that 33 of 36 top lobbying jobs had recently gone to Republicans. Former lobbyist Patrick Griffin, now an adjunct professorial lecturer at American University, told me that the project embodied the brazen crudeness of “DeLayism,” but also suggested that most lobbying firms and corporations were not “stupid” enough to purge Democratic staff and risk alienating much of the Hill.
What is clear is how much Santorum’s legacy is entangled with the two most corrupt political figures of the last decade: DeLay, and Jack Abramoff, who was said to have been involved in the Project. (Abramoff reportedly attended Santorum’s very first meeting, though Abramoff denied involvement and Santorum said in 2001 he couldn’t remember if he had.) Abramoff’s recent assertion that he “owned” politicians by dangling the promise of highly-paid lobbying gigs in front of powerful Hill staffers, though hyperbolic, is a fairly apt description of the K Street Project’s goals.
Yet, despite all this, Santorum’s communications director recently told the Washington Post that “Rick Santorum fought to destroy the good old boy network in Washington.” As an electoral strategy, of course, it makes sense for the former Senator to present himself as a Washington outsider and a paragon of personal ethics. But such claims of moral rectitude strain credulity. Santorum made a career polishing DC’s corrupt revolving door—only to walk through it himself at the first opportunity.
By: Simon van Zuylen-Wood, The New Republic, January 6, 2012
Newt’s Freddie Mac Lobbying Whopper
At Wednesday night’s GOP presidential debate in Michigan, Newt Gingrich was asked by the mostly on-the-ball CNBC panel about his work on behalf of housing giant Freddie Mac. For the former Speaker of the House, it was a bit of a welcome-back moment; for the last few months, he’s been so much of an afterthought that moderators haven’t even bothered with his own personal history and resume.
But Gingrich had an answer ready. He denied the lobbying charge, and then, via Benjy Sarlin, offered this spirited defense:
I offered advice. My advice as an historian when they walked in and said we are now making loans to people that have no credit history and have no record of paying back anything but that’s what the government wants us to do. I said at the time, this is a bubble. This is insane. This is impossible. It turned out unfortunately I was right and the people who were doing exactly what Congresswoman Bachmann talked about were wrong.
It’s pretty self-evident, though, that Gingrich wasn’t hired as a consultant because he was an untenured history professor at North Georgia College in the late 1970s. He was hired because, as a former Speaker of the House, he had a lot of influence with a lot of imporant people. An AP investigative report from 2008 framed Gingrich’s role as that of a political operator, greasing the wheels on Capitol Hill. Key section
Efforts to tighten government regulation were gaining support on Capitol Hill, and Freddie Mac was fighting back.
According to internal Freddie Mac documents obtained by the AP, Reps. Bob Ney (R-Ohio), and Paul Kanjorski (D-Pa.) spent the evening in hard-to-obtain seats near the Nationals dugout with Freddie Mac executive Hollis McLoughlin and four of Freddie Mac’s in-house lobbyists. Both were members of the House Financial Services Committee. The Nationals tickets were bargains for Freddie Mac, part of a well-orchestrated, multimillion-dollar campaign to preserve its largely regulatory-free environment, with particular pressure exerted on Republicans who controlled Congress at the time.
Internal Freddie Mac budget records show $11.7 million was paid to 52 outside lobbyists and consultants in 2006. Power brokers such as former House Speaker Newt Gingrich were recruited with six-figure contracts. Freddie Mac paid the following amounts to the firms of former Republican lawmakers or ex-GOP staffers in 2006…
Pushing back, Freddie Mac enlisted prominent conservatives, including Gingrich and former Justice Department official Viet Dinh, paying each $300,000 in 2006, according to internal records.
Gingrich talked and wrote about what he saw as the benefits of the Freddie Mac business model.
Gingrich made a pretty penny as a consultant in the 2000s. As CPI reported, the former Speaker’s consulting firm took in $312,000 from the ethanol lobby in 2009. Presumably, they weren’t paying him for his historical insights.
By: Tim Murphy, Mother Jones, November 11, 2011
Bandits, Blowhards And Showhorses: The GOP’s Road Not Taken
Over the past months, Republicans enjoyed enormous advantages. Opinion polls showed that voters are eager to reduce the federal debt, and they want to do it mostly but not entirely through spending cuts.
There was a Democratic president eager to move to the center. He floated certain ideas that would be normally unheard of from a Democrat. According to widespread reports, White House officials talked about raising the Medicare eligibility age, cutting Social Security by changing the inflation index, freezing domestic discretionary spending and offering to pre-empt the end of the Bush tax cuts in exchange for a broad tax-reform process.
The Democratic offers were slippery, and President Barack Obama didn’t put them in writing. But John Boehner, the House speaker, thought they were serious. The liberal activists thought they were alarmingly serious. I can tell you from my reporting that White House officials took them seriously.
The combined effect would have been to reduce the size of government by $3 trillion over a decade. That’s a number roughly three times larger than the cost of the Obama health care law. It also would have brutally fractured the Democratic Party.
But the Republican Party decided not to pursue this deal or even seriously consider it. Instead, what happened was this: Conservatives told themselves how steadfast they were being for a few weeks. Then morale crumbled.
This week, Republicans probably will pass a balanced budget constitutional amendment that has zero chance of becoming law. Then they may end up clinging to a no mas Senate compromise. This proposal would pocket cuts that have already been agreed on, and it would eliminate leverage for future cuts and make them less likely.
It could be that this has been a glorious moment in Republican history. It could be that having convinced independents that they are a prudent party, Republicans will sweep the next election. Controlling the White House and Congress, perhaps they will have the guts to cut Medicare unilaterally, reform the welfare state and herald in an era of conservative greatness.
But it’s much more likely that Republicans will come to regret this missed opportunity. So let us pause to identify the people who decided not to seize the chance to usher in the largest cut in the size of government in U.S. history. They fall into a few categories:
The Beltway Bandits
American conservatism now has a rich network of Washington interest groups adept at arousing elderly donors and attracting rich lobbying contracts. For example, Grover Norquist of Americans for Tax Reform has been instrumental in every recent GOP setback. He was a Newt Gingrich strategist in the 1990s, a major Jack Abramoff companion in the 2000s and he enforced the no-compromise orthodoxy that binds the party today.
Norquist is the Zelig of Republican catastrophe. His method is always the same. He enforces rigid ultimatums that make governance, or even thinking, impossible.
The Big Government Blowhards
The talk-radio jocks are not in the business of promoting conservative governance. They are in the business of building an audience by stroking the pleasure centers of their listeners.
They mostly give pseudo Crispin’s Day speeches to battalions of the like-minded from the safety of the conservative ghetto. To keep audience share, they need to portray politics as a cataclysmic, Manichaean struggle. A series of compromises that steadily advance conservative aims would muddy their story lines and be death to their ratings.
The Show Horses
Republicans now have a group of political celebrities who are marvelously uninterested in actually producing results. Sarah Palin and Michele Bachmann produce tweets, not laws. They have created a climate in which purity is prized over practicality.
The Permanent Campaigners
For many legislators, the purpose of being in Congress is not to pass laws. It’s to create clear contrasts you can take into the next election campaign. It’s not to take responsibility for the state of the country and make it better. It’s to pass responsibility onto the other party and force them to take as many difficult votes as possible.
All of these groups share the same mentality. They do not see politics as the art of the possible. They do not believe in seizing opportunities to make steady, messy progress toward conservative goals. They believe that politics is a cataclysmic struggle. They believe that if they can remain pure in their faith then someday their party will win a total and permanent victory over its foes. They believe they are Gods of the New Dawn.
Fortunately, there are still practical conservatives in the GOP, who believe in results, who believe in intelligent compromise. If people someday decide the events of the past weeks have been a debacle, then practical conservatives may regain control.
By: David Brooks, Columnist, The New York Times, July 19, 2011
Eric Cantor Loves Government Spending…On The Drug Industry
Republicans would like you to believe that our deficit problem is primarily a spending problem and that responsibility for that problematic spending is primarily a Democratic responsibility. But the second claim is as misleading as the first. Republicans have also been known to promote wasteful government spending, particularly when it goes towards an industry with which they happen to be cozy. For a vivid illustration of this, look no further than a new Politico article about House Majority Leader Eric Cantor and his position on a key deficit reduction proposal.
The proposal in question would lower the cost of what the federal government currently pays to provide low-income seniors with prescription drugs. For years, the government purchased drugs for these seniors directly through Medicaid, taking advantage of the low prices drug companies must, by law, provide when selling drugs for the people in that program. But that changed in 2006, with the creation of Medicare drug benefit. At that point, the government delegated the purchasing of drugs for low-income seniors to private firms. And the firms haven’t been able to negotiate equally deep discounts, partly because of restrictions on their ability to limit drug availability.
According to the Congressional Budget Office, restoring the “Medicaid discount” for low-income seniors could save more than $100 billion over the course of a decade, depending on the structure of the proposal. And, at one point, many health care reformers had hoped to include that proposal as part of what became the Affordable Care Act. The administration and leaders of the Senate Finance Committee agreed not to include the proposal in the final legislation, as part of their infamous deal with the drug industry lobby. But that was a one-time deal, at least in theory, and congressional negotiators are looking seriously at enacting the proposal now.
The problem is lawmakers like Cantor, who oppose the idea. According to the Politico story, written by Matt Dobias, Cantor is making the same argument that the drug industry lobby does: That the proposal would amount to a form of government price controls, retarding economic growth and discouraging innovation.
The latter point is highly dubious: The reduction would bring reimbursement levels for these drugs very close to what they were a few years ago. Many experts, including the CBO, think the likely impact on research and development would be negligible. (Harvard economists Richard Frank and Joseph Newhouse addressed this issue at some length in Health Affairs a few years ago.)
As for the former suggestion, it’s true that any net reduction in government spending could reduce economic growth, at least at this particular moment. That’s why it’s not a good idea to be madly slashing government spending right now — and why, perhaps, congressional negotiators should delay implementation of this cut, like the others, so that it would take effect after the economy has more fully recovered.
But Cantor’s anxiety over the economic ramifications of spending cuts seems strangely selective. He hasn’t raised similar concerns about cuts to food stamps, Medicaid, and similar programs that would likely have a more devastating impact, both on the economy as a whole and the people who depend upon them for support.
Then again, food stamp recipients didn’t donate $168,000 to Cantor’s reelection campaign in the last cycle. The drug industry did.
By: Jonathan Cohn, The New Republic, July 15, 2011
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