Janine Wedel - Unaccountable - How Elite Power Brokers Corrupt Our Finances, Freedom, and Security

There is no dearth of such power brokers. Some are household names like Summers, Rubin, and Daschle. But others that you may never have heard of are equally unaccountable, as are many whose names you know but whose machinations you may not be aware of. The front pages routinely offer up so many examples that in our featured column in The Huffington Post, co-author Linda Keenan and I have had a wealth of instances from which to draw (see, for example, our article profiling ten players from the last decade, including General Barry McCaffrey, Richard Perle of the “Neocon Core,” and former German Chancellor Gerhard Schroeder). 19These unaccountable players have shaped public policy, ranging from the decision to go to war in Iraq to the decision to run a direct gas pipeline from Russia to Germany.

To see just how this happens, let’s first take a look at how such players—whom I call “shadow lobbyists” and “shadow elites”—evade accountability. The way they organize their roles, work in and around entities, and enlist sponsors—in short, their MO—enables them to accomplish this. The players themselves are the centerpiece of this chapter.

Whether the focus is the players themselves, or the entities and sponsors they engage with (the subject of Part II), today’s dominant methods of wielding influence are less visible and more difficult to detect than, say, in the last half century. And this puts accountability on the line.

LOBBYING BY ANOTHER NAME

Shadow lobbyists, the simplest in terms of the modus operandi of the new breed of influencers, are a big part of the new corruption scene in the United States, Europe, and, by many accounts, beyond. 20The enterprise of influencing appears to be getting increasingly informal.

In the United States, where a power broker once might have sought the title “lobbyist” to display his influence, today he is likely to take on an executive role with a title like “strategist” or “adviser” or “government affairs specialist.” As a former president of the American League of Lobbyists (ALL), Paul A. Miller, observed, “‘. . . there’s a new way to lobby . . . and that includes PR consultants, grassroots consultants,’ and many others working outside the disclosure rules.” 21

The enterprise of lobbying has changed so much that the ALL decided to drop the word “Lobbyist” from its name in favor of the more innocuous “Association of Government Relations Professionals.” 22“We suggest ‘Congress Plus’,” quipped the editorial board of the New York Times in response, citing the employment in the lobbying industry of “more than 400 former members of the Senate and House, plus former congressional staff members estimated in one study to total 5,400 people over a recent 10-year period.” 23The lobbyists themselves said that the term was too narrow to encompass their current activities. As ALL (or AGRP) president Monte Ward said in a letter to members: 24

Through surveys and research, we discovered that a majority of our membership no longer identified themselves as only “lobbyists.” In fact, most of those surveyed stated that their responsibilities as a lobbyist encompassed just a fraction of their duties. While our organization was founded in 1979 to support the lobbying community, this industry has evolved dramatically over the years and now includes a variety of disciplines.

So what is the matter with lobbyists entering other arenas, or with changing the name of the association, as ALL did? Aren’t these smart players, skilled as they are at claiming and gaming the system, just helping to evolve an up-to-the-minute way of doing business?

Yes, they are. And that up-to-the-minute way is designed to avoid accountability. Indeed, many top power brokers eschew the term “lobbyist” because it allows them to evade regulations that were put in place to prevent conflicts of loyalty and interest. Individuals who are paid to lobby the federal government are required, under a 2007 law (which strengthened and amended parts of a 1995 act), to register and file regular reports of their activities and funding. Like regular lobbyists who abide by the legal requirements of the venues in which they operate, shadow lobbyists are (generally paid) advocates who try to persuade legislators or relevant government officials to enact policies that will benefit a particular industry or group.

When shadow lobbyists don’t register, they don’t have to disclose their true agendas or sponsors. 25Because we, the public, are in the dark, they can be much more effective. We didn’t know, for instance, that O’Bagy might have had her own agenda while pronouncing on potential U.S. airstrikes in Syria. And these influencers often have more access to the citadels of power than those whose titles are clearly “lobbyist.”

Shadow lobbyists are frequently former high government officials now connected to consulting firms, academia, the media, or think tanks; others might be one-timers, the way O’Bagy appears to have been. Still others are key players in corporate America or Wall Street. They peddle a policy, using the legitimacy or credibility gained in a current or former official role or affiliation. This aids the impression that the policy is in the public interest, even in situations where that case would be difficult to make.

As the New York Times , one of the few entities that has picked up on the ways of these influencers, writes: “They develop strategy and use their contacts to open doors and then leave the appointment-making to more junior people who are registered as lobbyists.” 26Jack Abramoff, who published a book about how the Big Boys operate, described the rules of the game thusly: 27

. . . they’ll pick the phone up and they’ll call their buddy, the senator, their old buddies, and they’ll say, “Listen, I’m here at this law firm now. I can’t lobby you, but my new partner, Jack, can lobby you. Can he come up and meet with you?”

While Abramoff himself went to prison for blatant acts of fraud, this kind of corruption, he underscores, remains fully legal and widely accepted.

It’s so accepted, in fact, that shadow lobbyists may be overtaking registered ones, at least in the United States. Registered lobbyists are on the decline. Their number peaked in 2007 at 14,845 and fell to 9,434 in 2013. 28In 2013, the New York Times reported “dramatic” drops at some of Washington’s top lobbying firms. The well-known firm Barbour, Griffith and Rogers (also known as BGR Group) saw a thirty-eight-percent revenue falloff from 2007 to 2012; the firm QGA had a fifty-eight-percent decline over a similar time period. 29The business of influence, though, is far from dead.

Shadow lobbyists also come from places that might seem far removed from political power centers: top universities. High-profile academics are particularly insidious. They are attractive to those who buy their services precisely because, ironically, it’s the image of the neutral, incorruptible scholar that these academics sell to the public. But sometimes they are hardly so.

As we shall see in Chapter 8, economists have been especially active shadow lobbyists—and not only in America. 30German economist and former European Central Bank official Otmar Issing penned an op-ed in the Financial Times to argue against a rescue package for Greece, while failing to mention that he was a Goldman Sachs adviser. This was flagged by a fellow economist, Simon Johnson, who questioned whether Issing might be “talking Goldman’s book, whether he realizes it or not.” He was suggesting the very real possibility that Goldman might indeed profit from Greece’s failure, and that readers should at the very least know Issing’s affiliation. Johnson also notes that globalization means there is no clear jurisdiction or body to investigate potential impropriety in a situation like this. “Welcome to the scary and essentially unsupervised world of international banking,” he writes. 31