March 17, 2006
Same Washington, Different Office
By LESLIE WAYNE, NY TIMES
LINKWASHINGTON As attorney general, John Ashcroft was a model of moral rectitude to his conservative supporters. To his liberal detractors, he was overly self-righteous. Mr. Ashcroft sees himself simply as a man of integrity, and to him that is worth a lot.
So in the era of the Jack Abramoff scandal, Mr. Ashcroft has become a Washington lobbyist, setting himself up as something of an anti-Abramoff and marketing his insider's knowledge of how Washington works.
To do so, he has amassed a staff of Republican insiders and rented fancy offices. For corporations seeking contracts from the growing homeland security budget, Mr. Ashcroft promises to draw on his central role in the war on terror and in helping set up the Department of Homeland Security. For companies in trouble with regulators, he says his experience in cracking down on corporate corruption can provide valuable insights.
"Clients would call in an individual who has a reputation for the highest level of integrity," he said in an interview in his office. "Those who have been in government should not be forbidden from helping people deal with government, which is what I see myself doing." In the hourlong interview, Mr. Ashcroft used the word "integrity" scores of times.
Since opening his office in September, he has lined up 21 clients, turning down two for every one accepted, he said.
Still, some critics find his move from the nation's chief law enforcement officer to K Street, the heart of the lobbying world, to be as undignified as it is unusual.
Danielle Brian, executive director of the Project on Government Oversight, said that because Mr. Ashcroft had worked only in government, "he cannot claim to have any business expertise."
"What is he selling," Ms. Brian asked, "other than connections and knowledge of how to game the system from being attorney general?"
One of Mr. Ashcroft's newest clients is
ChoicePoint, a broker of consumer data that is increasingly being used by the government to keep tabs on people within the United States. The company received millions of dollars in contracts from the Justice Department under Mr. Ashcroft as part of the war on terror and has now hired him to find more.
"The Ashcroft Group contacted us and we initiated a relationship," said Chuck Jones, a ChoicePoint spokesman. "He's got a lot of knowledge that could benefit ChoicePoint."
Before the 9/11 attacks, there were few commercial opportunities at the Justice Department. Since then, the department has become a major clearinghouse for large contracts related to homeland security.
Mr. Ashcroft promises to guide companies through the maze, saying, "I have been at the heart of the war on terror."
In 2001, only 15 companies lobbied officials regarding domestic security. By 2004, that number had grown to 861, according to the Center for Public Integrity, a nonpartisan watchdog group in Washington. Total federal spending aimed at preventing terrorism and other risks, including Homeland Security and other agencies, is $54.8 billion and is expected to rise to $58 billion in 2007.
"You want someone who knows the inner workings of homeland security because it's such a tangled mess," said Brian W. Ruttenbur, an industry analyst with Morgan Keegan, a brokerage firm. "Knowing somebody who understands the structure and can make introductions is invaluable. When you are a company you're focusing on making a product, and marketing it to government is very different."
After helping prosecute executives at Enron and WorldCom, Mr. Ashcroft also says he can counsel troubled companies on how to deal with government regulators and avoid the fate of Arthur Andersen, the accounting firm that collapsed after it was indicted in the Enron scandal.
"They need someone who can take threatening circumstances and neutralize them," Mr. Ashcroft said. "I'll be a lightning rod for people facing serious challenges."
Mr. Ashcroft is the only former Bush cabinet member and, by anyone's reckoning, the only former attorney general to have registered as a lobbyist. Many former attorneys general have had lucrative careers as political fixers without calling themselves lobbyists; in that sense, Mr. Ashcroft is being more transparent than his predecessors.
In a mission statement to prospective clients, he boasts of his connections. Mr. Ashcroft and "his talented team," the statement says, "have developed and cultivated close relationships with leaders in the corporate world as well as with officials in the top levels of the U.S. Government."
His staff includes David T. Ayres, his former chief of staff; Juleanna Glover Weiss, a Republican lobbyist and a former press secretary to Vice President Dick Cheney; and a Republican fund-raiser, William C. T. Gaynor II, who helped raise more than $300 million in the 2004 election. He opened his office 10 months after leaving the Justice Department.
Fellow Republicans praise his venture. "To have someone around to guide you to protect the assets of the corporation, it would be John Ashcroft who you would want at the table," said Donald L. Evans, the former commerce secretary. "Any C.E.O. in the 21st century would want him."
After three decades in public office in Missouri and Washington, Mr. Ashcroft, 63, says he has decided to make up for lost time financially. Before joining the Bush administration, Mr. Ashcroft was a United States senator, and the governor and attorney general in Missouri.
His most recent federal financial disclosure statement showed Mr. Ashcroft to be comfortable but not particularly wealthy, with a portfolio valued at $500,000 to $1.5 million and a state of Missouri pension. He is also eligible for a federal pension.
So after having a salary that topped out at $175,700 as attorney general, Mr. Ashcroft is running his firm and hitting the speakers' circuit, speaking nearly once a week for a $75,000 fee. In addition, Mr. Ashcroft has been given equity stakes in private companies that have hired him, betting on a future gain should they go public. The firm did not disclose the companies.
To maintain his conservative ties, Mr. Ashcroft signed up as a visiting law professor at Regent University, a Christian graduate school founded by Pat Robertson, the political evangelical broadcaster. And he is writing a book about his years in the Bush cabinet, to be published by Center Street, an imprint of Time Warner Books.
One of his first clients was the software giant Oracle, which was seeking Justice Department approval for a $5.8 billion takeover of Siebel Systems, its largest competitor. Oracle hired Mr. Ashcroft, although as attorney general he opposed a $10 billion Oracle-PeopleSoft merger.
Just a month after the Ashcroft Group came on the scene, the Siebel takeover sailed through. Oracle declined to comment, as did the Justice Department.
While Mr. Ashcroft is prohibited by law from contacting the department directly, he was able to weigh in with strategic advice for Oracle from the sidelines, although he would not say what that advice was. Mr. Ashcroft said his only direct contact with the Justice Department was to attend its Christmas party last year.
Other clients include eBay, Israel Aircraft Industries International, LTU Technologies and the American Institute of Certified Public Accountants. For eBay, the Ashcroft group will provide public relations advice for a patent infringement case to come before the Supreme Court. The Israeli aerospace company hired Mr. Ashcroft as it seeks $2 billion in military contracts from South Korea in competition with Boeing.
LTU Technologies, a software company, hired Mr. Ashcroft to find more customers for its visual imaging technology, which it already sells to the F.B.I. and customs officials.
Mr. Ashcroft declined to identify his other clients except to say, "It's not Billy Bob's car wash in Peoria."
Mr. Ashcroft first dealt with ChoicePoint after 9/11, when the Justice Department began to press for increased funds for the products that ChoicePoint sells; databanks full of details about the financial and personal lives of Americans.
In the war on terror, the government is increasingly turning to these private intelligence companies. Software from a ChoicePoint subsidiary was used by the military to help track down Saddam Hussein.
Today, government contracts represent about 14 percent of ChoicePoint's $1 billion in annual revenue. A further opportunity for Mr. Ashcroft arises from an investigation by the Securities and Exchange Commission into insider trading by the company's chief executive and chief operating officer.
Chris Jay Hoofnagle, senior counsel at the Electronic Privacy Information Center, a Washington digital rights group, said Mr. Ashcroft had the inside edge.
"As attorney general, Ashcroft created the conditions that allow companies like ChoicePoint to flourish," Mr. Hoofnagle said. "Ashcroft can open doors that others can't."
In counseling troubled companies, Mr. Ashcroft is entering a crowded field where fees can go as high as $900 an hour and where prominent former government officials, among them Richard L. Thornburgh, a former attorney general, and Richard C. Breeden, a former S.E.C. chairman, dominate the business.
"Every major law firm is trying to do special investigations," said Joseph A. Grundfest, a former S.E.C. commissioner.
But Mr. Ashcroft brushes away any doubters. "I've been stunned at how good people have been to me," he said. "And that kindness has been reflected in business opportunities. It's been gratifying, and I'm earning significant multiples of what I've ever earned before."
Official With No Campaign Is Still Spending Campaign Cash By MICHAEL COOPER, NY TIMES
LINKALBANY, March 16 Howard D. Mills, New York State's superintendent of insurance, accepted $15,000 in campaign contributions last year even though he is not running for office, campaign filings show.
Mr. Mills, a former Republican state assemblyman from Orange County, continues to use his old Assembly campaign account to pay for meals, cellphone bills, flowers, purchases from Restoration Hardware and Borders Books, and to make the monthly $588.55 car payments on a Chrysler 300, the filings show.
Mr. Mills left the Assembly in 2004 after mounting an unsuccessful campaign to unseat Senator Charles E. Schumer. After Mr. Mills lost in a landslide, Gov. George E. Pataki appointed him to the $127,000-a-year insurance post, where he is responsible for regulating about a thousand firms that hold more than $2 trillion in assets.
In an interview on Thursday, Mr. Mills said that while he was not running for any office this year, and did not expect to seek office before 2008, he had kept his campaign account active because he planned to be a candidate again someday.
"It is absolutely necessary that I maintain my profile," he said, adding that all the expenditures were made legally for political, not personal, purposes. He said he uses the Chrysler only to drive to political events that he would not feel comfortable driving his state-issued Dodge Durango to. He also said that the purchases his campaign account made from well-known chain stores were for gifts that he gave to his political volunteers.
Mr. Mills said none of the contributors who included four people from Brooklyn who gave $2,500 apiece had business pending before the Insurance Department.
Such fund-raising by an appointed official would be illegal in New York City, where department heads are not allowed to solicit campaign contributions even if they are running for office.
Federal employees face even tougher laws devised to insulate them from politics: under the Hatch Act, federal employees are not allowed to run for office in partisan elections, or to solicit or receive political contributions.
But Albany has much less stringent laws governing campaign finance. Its ethics rules allow state employees to raise campaign contributions as long as the donors do not have business before their department.
And while state election law does not allow campaign funds to be spent on personal uses "unrelated to a political campaign or the holding of a public office," candidates have interpreted the law loosely. Officials have spent campaign funds on everything from trips to tropical vacation spots to a swimming pool cover to criminal defense lawyers.
Blair Horner, the legislative director for the New York Public Interest Research Group, which is urging the state to strengthen its campaign finance laws, questioned how Mr. Mills's expenses could be related to a campaign if he is not running for office.
"I think that the governor should prohibit the practice," Mr. Horner said. "I don't think that agency heads with vast regulatory authority should be out shaking the fund-raising tree under the theory that they might, someday, run for office."
The campaign filings show that on Aug. 24, Mr. Mills's campaign account received $2,500 donations from Abraham Rubin, Lipa Rubin and Malky Landau, all of Brooklyn. A month later it received a fourth $2,500 donation, from Joshua Steinberg, also of Brooklyn. None had contributed to his Assembly campaign before.
The Brooklyn donors did not return repeated calls seeking comment.
Rabbi Jacob Freund, a village trustee from Kiryas Joel, in Orange County, said in an interview that he solicited the donations for Mr. Mills. He said the Brooklyn donors all had ties to Kiryas Joel, a booming village of Hasidic Jews 45 miles north of New York City.
Throughout the 1990's, Kiryas Joel sought Albany's help to create a school district for its disabled students. After several courts, including the United States Supreme Court, struck down early versions of state laws that had authorized the creation of the district on the ground that they violated the separation of church and state, Albany passed a revised law and the village got its district.
Rabbi Freund said that Mr. Mills had not asked him to solicit the funds, but that he had wanted to do so to thank him for his service as an assemblyman, and because he thinks Mr. Mills will be a rising political star. He said he would only solicit donors who do not have business before the Insurance Department.
"He's not 100 percent kosher; he has to be 110 percent," Rabbi Freund said.
Mr. Mills also received a $5,000 donation in September from Devon Management, a corporation that has donated to him several times in the past.
Mr. Mills noted that he had used his campaign account to make several political contributions, including a $5,000 donation to the New York State Senate Republican Campaign Committee. He has often been mentioned as a potential candidate for the State Senate seat now held by William J. Larkin Jr., who joined the Legislature in 1979. But Mr. Mills said that Senator Larkin was running for re-election this year, so he would not challenge him.
March 11, 2006
Push to Tighten Lobbying Rules Loses Strength By SHERYL GAY STOLBERG, NY TIMES
WASHINGTON, March 10 The drive for a tighter lobbying law, just two months ago a major priority on Capitol Hill, is losing momentum, a victim of shifting political interests, infighting among House Republicans and a growing sense among lawmakers of both parties that wholesale change may not be needed after all.
In the Senate, debate on a lobbying bill was derailed this week by the fracas over port security, and it is unclear when the measure will return. A chief architect of the legislation, Senator Susan Collins, Republican of Maine, said Friday that the bill was "way off track" and that she feared its chances had been jeopardized.
"People have turned to other issues," Ms. Collins said in a telephone interview from Maine. "This was our window, and I'm afraid it will be slammed shut."
In the House, Representative David Dreier of California, the Republicans' point man on lobbying legislation, said reaching consensus on what the bill should include had been more difficult than he had expected.
In January, shortly after the lobbyist Jack Abramoff pleaded guilty to corruption charges, Mr. Dreier and Speaker J. Dennis Hastert called for tough restrictions, including a ban on gifts, meals and privately financed travel. They said their aim was to have legislation drafted by February. But the new majority leader, Representative John A. Boehner of Ohio, is not keen on the travel ban, and there is still no legislation.
"We have not moved as expeditiously as we would have liked," Mr. Dreier said in an interview. "There is a wide range of views. There are still people who feel very strongly about the need to make some changes, and there are people who are not as enthused."
Members of both parties said that they still expected some kind of lobbying legislation to be passed this year but that it might be narrower than many advocates of tighter rules first called for.
The initial fervor for legislation was fueled by the Abramoff scandal, coupled with the resignation of Representative Randy Cunningham, Republican of California, after he pleaded guilty in another corruption case. With the midterm elections on the horizon, lawmakers seemed in a big hurry for reform. Republicans in particular worried that the ethics issue would turn on them the way it did on Democrats in 1994, when Republicans took control of the House.
"Comprehensive lobbying reform is the right thing to do," Mr. Hastert said in January, adding, "I believe that to regain the trust of the American people in this institution, we must go further than prosecuting the bad actors."
But the next shoe in the Abramoff scandal has yet to drop, and lawmakers say their constituents are far more concerned with issues like health care and the Iraq war. Many express a view offered by Senator Mel Martinez, Republican of Florida, who said the Abramoff and Cunningham cases showed that the current laws worked.
"I do sense that there's a little less of a furor about it," Mr. Martinez said. "The people responsible seem to be being dealt with in the justice system, as they should. A lot of this is politically reacting to a situation, and when you get down to it, you realize that there's an awful lot of rules already on the books, and what we need to do is apply them."
Ms. Collins said she sensed reluctance to take bold action.
"People have mixed feelings," she said. "On the one hand, they do recognize that we need to boost public confidence in the integrity of our decision-making. On the other hand, members regard themselves as ethical, and some question whether we should be moving to fix the laws, when it was the laws that were broken."
The initial votes on the Senate bill have shown the limits of the appetite for change. Already a Senate committee has rejected a plan, advanced by Ms. Collins and Senator Joseph I. Lieberman, Democrat of Connecticut, to create an independent office to investigate ethics abuses. And while the Senate did vote this week in favor of a ban on gifts and meals from lobbyists, the real fight will be over whether to limit a much more lucrative perk: private travel, and lawmakers' use of corporate jets.
There has been little political fallout from the Abramoff case, according to the Pew Research Center for the People and the Press. A survey by the center in January, the week after Mr. Abramoff's guilty plea, found that just 18 percent of Americans had closely followed the case; by comparison, 32 percent had closely followed President Bush's acknowledgment that he had authorized the National Security Agency to conduct some domestic wiretapping without warrants.
Further, Congress tends to have a short attention span. Without a grass-roots hue and cry of the sort that pushed lawmakers to block the Dubai port deal this week, it was perhaps inevitable that the push for lobbying law changes would diminish.
"Abramoff made it topical and personal," said Senator Richard J. Durbin of Illinois, the No. 2 Democrat in the Senate, "and as time passes people start thinking about Dubai port deals and the future of the war in Iraq."
Outside observers say it will now take another eruption the indictment of a member of Congress in the Abramoff inquiry, or a similar scandalous event to put the issue front and center again.
One expert on money in politics, Prof. James A. Thurber of American University, predicted that any legislation would amount to "lobby lite" unless more lawmakers were prosecuted. And Norman J. Ornstein, a scholar at the American Enterprise Institute who has testified frequently on lobbying law changes, said: "The fervor for reform in this case was driven by a fear that a match was about to be lit to dry tinder. They were scared to death they would go back home and people would be waiting as they got off the plane with buckets of tar and bales of feathers."
Representative Adam H. Putnam, Republican of Florida, said lawmakers' interest in tough restrictions was directly related to vulnerability at the polls. "I think this entire Congress is schizophrenic on this right now," said Mr. Putnam, a member of the House Rules Committee, which is charged with drafting lobbying legislation.
Mr. Dreier and Mr. Hastert both said in January that they wanted bipartisan support for legislation. But that could prove difficult in the House, where Democrats are hammering an election-year theme of a Republican "culture of corruption" and are using the lobbying issue to demand more influence within the chamber. Asked if she would be willing to work with Republicans, the senior Democrat on the Rules Committee, Representative Louise M. Slaughter of New York, said, "I have misgivings about that."
Some in the House are waiting to see what the Senate will do. But when Senator Charles E. Schumer, Democrat of New York, tried to attach a port security measure to the Senate's lobbying bill this week, the lobbying debate came to a halt. Unless the two parties can reach an agreement to dispatch the legislation quickly, the bill may not come back to the Senate floor until April.
"It did lose momentum," said Senator Trent Lott of Mississippi, the chairman of the Rules and Administration Committee, who is managing the Senate floor debate. But "I think it will come back again," he said, "because we need to do it, we can do it."
ChoicePoint
