“A Lobbyist By Any Other Name”: Scott Brown Makes It Official With Wall Street
Former Massachusetts Sen. Scott Brown announced today that he’s joining the government affairs department of a giant multinational law firm with major Wall Street clients.
“Brown will focus his practice on business and governmental affairs as they relate to the financial services industry as well as on commercial real estate matters,” the firm, Nixon Peabody LLC, said in a press release. Brown will not be a lobbyist, the firm said, but whether he meets the specific legal requirements to be a registered lobbyist or not, it’s clear that he will draw on his contacts and status to help advance clients’ agenda in government. “He can offer many types of legal services to his broad network of contacts,” the firm said.
The head of the Nixon Peabody’s Government Relations practice is ex-New York congressman Tom Reynolds, who now lobbies for Goldman Sachs on “[f]inancial services regulatory and tax issues.” According to the firm, Brown will also work with fellow Massachusettsian Jim Vallee, who abruptly left his job as majority leader of the state House of Representatives last year after getting hired by the firm.
Nixon Peabody contributed $2,500 to a PAC associated with Brown’s reelection campaign last year, the most it gave to any candidate in the country (tied only with a Democratic House member).
Brown was a reliable ally of the financial services industry in the Senate, where he helped water down the Dodd-Frank Wall Street reform law and influence other bills of interest to banks. It was no surprise, considering how much money they threw at his campaigns. The Securities and Investment sector was the top industry donor to Brown’s 2012 campaign, giving him $3.2 million, on top of the millions he received from the insurance, real estate and finance industries, according to Open Secrets.
The move, however, is a blow to Massachusetts Republicans, who see Brown as their best — and possibly only — hope of retaking a Senate seat or winning the governor’s mansion. Perhaps Brown didn’t think he could win or perhaps he was more interested in cashing in.
It’s notable that Massachusetts voters have replaced Brown, who is now almost literally a Wall Street lobbyist, with Elizabeth Warren, one of the most outspoken critics of the finance industry in the country.
By: Alex Seitz-Wald, Salon, March 11, 2013
“Send Disaster Response To The States”: Mitt Romney’s Disastrous Emergency Management Plan
As 50 million East Coast residents brace for Hurricane Sandy’s impact, President Obama has already signed disaster declarations for at least a dozen states, making available the resources and unique coordinating capabilities of the federal government — specifically, the Federal Emergency Management Agency, or FEMA – to assist in the response and recovery.
It’s worth noting that Mitt Romney has said he’d get rid of FEMA and leave states to fend for themselves.
At a CNN-sponsored GOP debate last June, moderator John King asked Romney what he would do to keep FEMA solvent. Romney replied that we need to cut government spending and should “send it back to the states … And if you can go even further and send it back to the private sector, that’s even better.” King looked a bit surprised and followed up to make sure Romney was saying what he appeared to be saying. “Including disaster relief, though?” King asked. Romney answered affirmatively: “We cannot — we cannot afford to do those things without jeopardizing the future for our kids. It is simply immoral, in my view, for us to continue to rack up larger and larger debts and pass them on to our kids, knowing full well that we’ll all be dead and gone before it’s paid off. It makes no sense at all.”
A Romney spokesperson, in a vague statement to the Huffington Post last night, suggested that eliminating FEMA is still Romney’s position.
“Send it back to the states” is a typical conservative talking point, of course. But the states don’t inspire much confidence when it comes to emergency management. FEMA also has a budget of about $6 billion that would disappear from the total pool of money available for disaster relief if the agency were eliminated tomorrow, unless states raised their taxes to make up for the loss, something Romney and his party seem unlikely to support.
Romney, as a former governor, ought to know better.
This is how a federal disaster area gets declared: The governor of a state submits a letter to the local FEMA branch requesting help. “In this request the Governor certifies that the combined local, county and state resources are insufficient and that the situation is beyond their recovery capabilities,” according to FEMA. So every time a governor submits a request for assistance — and there were a record 99 disaster declarations in 2011 — they have to declare they are incapable of handling the situation on their own.
And Romney does know, firsthand. For example, there was a November 2006 chemical plant explosion in Danvers, Mass. “You know, we’ll be looking at what the requirements are from a, from a national standpoint. We do have FEMA here now … The needs of the state or it should be the needs here, if they can be met by the state, they will be. If it’s beyond the needs or the capability of the state, then we’ll go to the federal government,” he said at a press conference.
Several months before that, in May, Romney requested additional money from FEMA to deal with flooding in Lowell, Mass. Before that, in October 2005, Romney requested FEMA help for several counties affected by flooding. Etc. etc.
But perhaps it isn’t fair to criticize Romney over these instances, since he was merely operating under the existing system and naturally wanted to do everything he could do to help his state.
But the idea of sending things back to the state makes little sense if you think about it for even a second. Natural disasters frequently transcend political borders, affecting multiple states simultaneously. Absent a unified chain of command coordinating the response in affected areas, you’d get a patchwork of different responses and approaches, which may be very difficult to coordinate. Poorer states with a weaker tax base may be less able to respond adequately. A national agency can pool and transfer resources across the entire county in a way that states can’t — individual state may go years without a major disaster, whereas FEMA is always busy. There are plenty of legitimate criticisms of FEMA, especially after Hurricane Katrina, but they all relate to how it needs to be more effective, not less so.
In a nutshell, disaster preparedness hits at the whole point of having a federal government and federalism. It’s a pretty good illustration of how far to the right the GOP has shifted that Romney wants to send disaster relief to states despite that being an obviously terrible idea. And privatizing disaster relief is even scarier. Who will pay for that? How will contractors be held accountable? Other cases of largely privatized disaster relief have raised serious red flags.
By: Alex Seitz-Wald, Salon, October 29, 2012
“I Love Vetoes”: Mitt Romney’s False Claims Of Bipartisanship In Massachusetts
In Tuesday night’s presidential debate at Hofstra University on Long Island, Mitt Romney said, “We haven’t had the leadership in Washington to work on a bipartisan basis. I was able to do that in my state.” This repeats a claim he made repeatedly in the first debate that he worked successfully in with the Democratic state legislature in Massachusetts. “Republicans and Democrats both love America,” said Romney. “But we need to have leadership—leadership in Washington that will actually bring people together and get the job done and could not care less if—if it’s a Republican or a Democrat. I’ve done it before. I’ll do it again.”
Romney also argues that an ability to work across the aisle is essential for any president, and that it is a quality he has and Obama lacks. At the first debate, Romney said, regarding a deficit reduction deal, “I think something this big, this important has to be done on a bipartisan basis. And we have to have a president who can reach across the aisle and fashion important legislation with the input from both parties.”
Romney’s surrogates have even gone so far as to offer his bipartisanship approach as the reason he will not specify what tax expenditures he will eliminate to offset the cost of his tax cuts, arguing that he should work with Congress to identify them, rather than dictating his own preferences.
During the primaries, when Romney claimed to have been “a severely conservative governor,” he never boasted of working with Democrats.
In truth, his approach in Massachusetts was neither severely conservative nor bipartisan. Democrats in the legislature held a veto-proof super-majority. That meant Romney had no choice but to play ball with them or else he would get nothing done. Sometimes he opted for the former, as in the case of healthcare reform. Often, he opted for the latter.
Looking at Romney’s record in Massachusetts one does not see bipartisanship as an operating principle. Rather than it is a tool he uses when it is convenient. Romney was not particularly good at cultivating relationships with the Democratic legislature. Former Massachusetts House Speaker Tom Finneran told the Associated Press, “Initially [Romney’s] sense was, ‘I have been elected governor, I am the CEO here and you guys are the board of directors and you monitor the implementation of what I say.’ That ruffled the feathers of legislators who see themselves as an equal branch (of government).”
Romney’s approach to the legislature remained mostly hostile, rather than conciliatory. As NPR reports:
Romney clearly did not relish having to work with a Legislature that was 85 percent Democratic. He pushed hard during his first two years as governor to boost the number of Republicans on Beacon Hill. But that effort was a failure; Republicans ended up losing seats in the midterm elections…. Apart from health care, Romney defined success not with big-picture legislative accomplishments but with confrontation. In a 2008 campaign ad, Romney actually bragged about taking on his Legislature: “I like vetoes; I vetoed hundreds of spending appropriations as governor,” he said.
Romney issued some 800 vetoes, and the Legislature overrode nearly all of them, sometimes unanimously.
In 2005 and 2006, after Romney decided not to run for re-election but instead to seek the Republican presidential nomination, he abandoned much of his erstwhile moderation. Massachusetts pulled out the Regional Greenhouse Gas Initiative, abandoned his smart growth policies, and reversed his prior support for abortion rights and stem cell research. Refusing to make investments in stem cell research and renewable energy—two important sectors of Massachusetts’s economy—contributed to his abysmal record on job creation.
It is also hard to reach across the aisle when you aren’t even in town. Towards the end of Romney’s tenure, he was out of the state more than he was in it. In 2006, Romney’s last year in office, he was traveling out of state for all or part more than 200 days. During his total four years he was out of the state more than 400 days. While on the road, speaking to Republican audiences, he would frequently mock Massachusetts for its liberal politics. By the time he left office, his approval ratings back home were 34 percent.
If anything, Romney’s approach in the White House would be even more partisan and polarizing. In Massachusetts, Romney was not only governing with Democratic legislature but with a liberal electorate. What he did under those circumstances could be quite different from what he would do with a Republican Congress and a national Republican constituency.
By: Ben Adler, The Nation, October 17, 2012
“Pilfering The Federal Treasury”: Mitt Romney’s Medicaid Shell Game
Mitt Romney is lambasting federal aid in his campaign for the presidency, including derisive comments against those who receive government assistance. But he pulled all the stops to pursue federal aid as governor of Massachusetts, even hiring “revenue maximization” contractors to scour federal programs for every possible penny — and using financial schemes to maximize and then divert the aid from his needy constituents.
In his first budget proposal, Romney promised balancing the budget without tapping reserves, and “without the use of fiscal gimmicks.” However, buried in the details, he suggested tapping reserves such as taking $4 million from the Catastrophic Illness in Children Relief Fund, and he included fiscal gimmicks to maximize and divert federal aid into his general state coffers.
His strategies are akin to tax schemes using offshore bank accounts — but instead of avoiding federal taxes, seeking to pilfer the federal treasury. The Wall Street Journal labeled such financing mechanisms “Medicaid Money Laundering” and a “swindle.”
Medicaid is a matching grant program. If a state with a 50 percent match rate like Massachusetts spends $50 on qualifying services, the federal government will provide an additional $50 so there is $100 total for Medicaid services. The federal match payment is much higher in some states, such as Mississippi where its almost 75 percent.
Unfortunately, some states concocted budget shell games, often with private consultants, providing an illusion of state spending to claim federal matching funds, when no state spending has occurred. As governor of New Hampshire, Judd Gregg developed such a practice labeled “Mediscam.” Gregg taxed hospitals serving the poor, routed the money into an “uncompensated care fund” which he sent right back to the hospitals, and used the round-trip of money to claim federal matching funds. Then, the swindle gets worse, because he routed the federal Medicaid funds into his general coffers rather than for Medicaid services.
Romney’s schemes were similar to Gregg’s. Buried in his 2004 budget, Romney proposed maximizing federal aid by taxing hospitals, shifting the resulting tax payments in and out of an uncompensated care fund, back to hospitals as adjustment payments, and diverting resulting federal Medicaid funds to state general revenue. He also proposed using taxes on nursing homes and pharmacies in his efforts to maximize and divert federal aid.
In such strategies, health care facilities serving the poor are used to claim federal funds to help the poor. But the health care facilities and the poor may get nothing, as the state diverts the federal aid to general coffers — and revenue maximization contractors reap millions in contingency fees. Romney used such private companies to help carryout his strategies.
After a US General Accounting Office report responding to concerns of Republican Senator Charles Grassley, the Romney administration vigorously defended using contingency-fee revenue maximization consultants and revenue practices – that the GAO labeled illusory. The GAO responded that “hospitals should benefit from increased federal reimbursements and Massachusetts’s arrangement appeared to result in lower payments to hospitals, despite increased claims for federal reimbursement.” The Romney administration even defended double (if not quadruple) billing practices “of allowing multiple agencies to bill Medicaid” for “services for the same beneficiary.” The GAO concluded that the Romney administration “did not provide convincing evidence that the [Medicaid] services provided by the four state agencies were unique,” and the Bush administration agreed with the GAO’s conclusions.
The Bush administration implemented regulations trying to reduce such practices, and the Obama administration continues efforts to improve fiscal integrity in the Medicaid program. However, Romney would virtually end federal oversight by block-granting federal Medicaid funds to states.
It’s not hard to imagine how a governor — one that employs complex shell games to find loopholes in federal rules in order to maximize and divert federal aid — would use the federal funds if handed to the state without any federal oversight. The answer to state misuse of federal aid is not to give those states even more discretion to do whatever they wish – but to simplify the claiming process, reduce loopholes allowing the revenue schemes, and improve oversight to ensure Medicaid funds are used as intended.
Romney has undergone dramatic and hard to follow shifts in his apparent views of government aid. Romney2004 proposed cutting healthcare while simultaneously proposing illusory schemes to maximize and divert federal Medicaid funds. Romney2006 changed course with the first nearly universal healthcare plan. Now Romney2012 is turning back to cuts, denouncing federal aid he once schemed to maximize and divert, condemning those who need government aid, and seeking repeal of national health care reform that is nearly identical to the plan he signed into law. And now he proposes giving all the federal money from the Medicaid program to states without federal control.
Romney2004 would have a field day with Romney2012’s plan.
By: Daniel L. Hatcher, Law Professor, University of Baltimore, Published in The Boston Globe, October 12, 2012
“Walking Back Another Lie”: Romney Health Care Debate Claim Gets Corrected By His Own Staff
Independent fact checkers have not been particularly kind to Mitt Romney since Wednesday’s first presidential debate in Denver. But one of the candidate’s claims turned out to be so far off the mark that he had to be corrected by his own aides — a fact not unnoticed by the Obama campaign.
Romney’s claim was this, part of what turned out to be a highly detailed discussion of health care: “No. 1, pre-existing conditions are covered under my plan.”
By pre-existing conditions, Romney was talking about the ability for people who already have medical problems — diabetes, for example, or even things like allergies — to buy health insurance. Starting in 2014, the federal Affordable Care Act says insurance companies can no longer reject people with bad health histories — nor can they charge them more.
That’s already true in Massachusetts under the law Romney signed as governor. But Romney’s current plan for the nation, should he be elected president, wouldn’t necessarily guarantee that same protection.
“Actually, governor, that isn’t what your plan does,” President Obama told Romney at the debate Wednesday. “What your plan does is to duplicate what’s already the law.”
The president was referring to the Health Insurance Portability and Accountability Act, or HIPAA. It’s a 1996 law that says, among other things, that once you have health insurance you can continue to purchase it, as long as there’s no interruption in your coverage of more than 63 days.
But Romney’s plan wouldn’t guarantee that people who don’t have coverage now will be able to buy it. Top Romney adviser Eric Fehrnstrom said as much in the so-called spin room to several reporters right after the debate, and again on Thursday on CNN.
“The governor will repeal Obamacare and he will return to the states the power to control their own health care futures,” Fehrnstrom told Wolf Blitzer. “Look, what works in Massachusetts may not work in Texas. It was wrong for the president to take the broad outlines of the Massachusetts plan and impose it as a dictate from Washington on every state in the nation.”
That correction was gladly picked up by the Obama forces. At a rally Friday in Northern Virginia, Obama took credit for one of the few times he actually called Romney out during the debate.
“Gov. Romney was fact checked by his own campaign. That’s rough,” the president told a cheering crowd at George Mason University. “Even they know his plan would take away coverage for tens of millions of Americans.”
This isn’t the first time a Romney statement has had to be walked back by his staff when it comes to health care. In recent weeks he’s misstated or switched positions on abortion and on Medicaid. But at 67 million viewers, this was by far the largest audience that’s heard something different from what the candidate’s position actually is.
By: Julie Rovner, NPR, October 6, 2012
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