The Buying of the President 2000

Introduction

WASHINGTON, D.C. January 5, 2000 — Each of the leading presidential candidates for the 2000 election has done public- policy favors for his campaign contributors, according to a new Center for Public Integrity book, The Buying of the President 2000 (Avon). Every major White House contender who has held past elective office has “career patrons,” or longtime financial sponsors, who have underwritten his political career. And every major aspirant has used his government position to help his patrons.

This mutually beneficial relationship between a politician and his patrons is seldom acknowledged or discussed publicly. Indeed, none of the current presidential candidates would agree to be interviewed for The Buying of the President 2000 (Read Vice President Gore correspondence). Yet these relationships between candidates and their sponsors can reveal a more accurate picture of the practical logistics and accommodations, beyond common political rhetoric, of achieving power in today’s electoral process.

For example, in the Democratic Party, Vice President Al Gore has had a longtime relationship with Occidental Petroleum that has been enormously beneficial to the company. Occidental’s late chairman, the controversial Armand Hammer, liked to say that he had Gore’s father, Sen. Albert Gore Sr., “in my back pocket.” When the elder Gore left the Senate in 1970, Hammer hired him for $500,000 a year. Personally and professionally, the vice president has profited from Occidental largesse. To this day, he still draws $20,000 a year from a land deal in Tennessee brokered between his father and Hammer, which cumulatively has amounted to more than $300,000. The personal relationship between young Gore and Hammer was very close throughout the 1980s, including trips on Hammer’s private jet and constant campaign contributions.

For most of the 20th century, oil companies have tried unsuccessfully to obtain control of two oil fields owned and operated by the federal government – the Teapot Dome field in Casper, Wyo., and the Elk Hills field in Bakersfield, Calif. Despite his public reputation as a staunch environmentalist and his authorship of Earth in the Balance, Gore recommended that the president approve giving oil companies access to this publicly owned land that the U.S. Navy had held as emergency reserves since 1912. In October 1997, the Energy Department announced that the government would sell 47,000 acres of the Elk Hills reserve to Occidental.

It was the largest privatization of federal property in U.S. history, one that tripled Occidental’s U.S. oil reserves overnight. Although the Energy Department was required to assess the likely environmental consequences of the proposed sale, it didn’t. Instead it hired a private company, ICF Kaiser International, Inc., to complete the assessment. The general chairman of Gore’s presidential campaign, Tony Coelho, sat on the board of directors.

The very same day the Elk Hills sale was announced, Gore delivered a speech to the White House Conference on Climate Change on the “terrifying prospect” of global warming, a problem he blamed on the unchecked use of fossil fuels such as oil. “If we ignore the scientific warnings and continue stubbornly on our current course, we’d better begin to prepare what we would like to say to our children and grandchildren. . . . they might fairly ask, ‘If you knew all that, why didn’t you do something about it?’ “

According to The Buying of the President 2000, Gore’s top career patron is the international accounting firm Ernst & Young, whose partners and spouses have given Gore $125,200 over the years. The company’s top in-house lobbyist, Jeffrey Hirschberg, is now one of the vice president’s top fund-raisers. Ernst & Young’s clients have gotten access and a sympathetic reception from Gore and others in the Clinton administration for some of its tax-lobbying clients, such as the National Association of Independent Colleges and Universities.

George W. Bush

Texas Governor George W. Bush, of course, has shattered all previous fund-raising standards for presidential candidates. In the first four months of his campaign, he took in $37 million, or $310,748 a day. He was able to accomplish this in part by inheriting his father’s national network of financial supporters going back more than a quarter century.

According to The Buying of the President 2000, “Throughout his long business career and in his six years as governor of Texas, Bush has relied on family connections, sweetheart deals, and the inside track to build a fortune. And Bush . . . has always been willing to return the favors.”

The new investigative book details Bush’s close ties to the oil industry, and documents how he has taken care of his supporters over the years as governor, by giving them choice political jobs, pushing pro-industry legislation, or literally letting major, multibillion-dollar corporate polluters such as Exxon and Marathon Oil write their own emissions regulations in Texas.

Bush’s top career patron is Enron, whose officers, directors and employees have contributed $550,025. Enron is one of the more than two dozen corporations to benefit from Bush’s voluntary emissions compliance program.

But no personal relationship of Bush’s is more interesting than that with Fort Worth financier Richard Rainwater. He orchestrated the Texas Rangers stadium deal, which cost at least $200 million in taxpayer subsidies and personally netted Bush a profit of more than $15 million. Without that business success, Bush has said he would not have entered politics.

With Bush in Austin, Rainwater soon found himself awash in potential windfalls. While some never materialized, many did. Rainwater is a founder of Columbia/HCA, the nation’s largest for-profit hospital chain. In 1995, Bush vetoed a Patient Protection Act, arguing that the bill “unfairly impacts some health care providers while exempting others.” Columbia/HCA had forcefully opposed the legislation.

In 1997, Bush proposed that the state look into privatizing Texas’s mental-health hospitals, at the same time that Rainwater was in the midst of building a private mental health care chain, and at one point, his company, Crescent, became the nation’s largest provider of private mental health care services. Ultimately, the governor’s privatization proposal was never enacted.

However, also in 1997, Governor Bush signed into law legislation allowing Texas cities to raise taxes to finance a new sports arena for the Dallas Mavericks professional basketball team. Rainwater, through one of his companies, had recently become a part-owner of the team, and will receive $10 million when the arena is completed late next year.

Bill Bradley

The Buying of the President 2000 also discloses that from 1986 to 1996, former New Jersey Senator Bill Bradley introduced at least 45 bills on behalf of chemical companies seeking a reduction or suspension of the taxes they pay on imported chemicals used in a variety of products, from pesticides and drugs to dyes and resins. He repeatedly sought tariff exemptions for the highly toxic pesticides ethyl parathion, methyl parathion, and malathion. All three belong to a class of chemicals known as organophosphates that were originally developed during World War II by the Nazis for use in chemical warfare. Meanwhile, Bradley has benefited handsomely from industry contributions to his campaigns.

Although sometimes perceived as ideologically to the left of Vice President Gore on some issues, no presidential candidate actually is closer to Wall Street today than Bill Bradley, according to The Buying of the President 2000. Five of his top 10 career patrons are Wall Street firms: Citigroup, $454,065; Merrill Lynch & Co., $169,500; Goldman Sachs, $148,800; Morgan Stanley Dean Witter & Co., $129,675; and Lehman Brothers Holdings, $91,250.

More specifically, over the course of his political career, Senate Finance Committee member Bradley raised hundreds of thousands of dollars in campaign contributions from officers and executives of firms in the corporate-takeover business. For example, he received $50,000 from Wesray Capital Corporation; $65,000 from Hambrecht and Quist; $84,250 from Skadden, Arps, Meagher and Flom, a New York law firm that made millions of dollars advising corporate raiders; more than $100,000 from Prudential Securities; $148,000 from Goldman Sachs; and $228,000 from Solomon Smith Barney. At the same time, Bradley opposed any attempt to use the U.S. tax code to rein in hostile takeovers.

Before the company collapsed in 1990, Bradley took in $20,000 from the notorious Drexel Burnham Lambert, Inc. In 1986, Bradley even attended Drexel’s Predator’s Ball, a lavish party at which Carl Icahn, Victor Posner and Nelson Peltz could rub elbows with junk-bond king Michael Milken, savings and loan operators and favored politicians.

Just a month after his retirement from the Senate in 1997, Bradley was pulling in $300,000 in consulting fees from one of the same Wall Street brokerages (J.P. Morgan Services, Inc., and its subsidiary Morgan Guaranty Trust Company of New York) whose practices he had defended in the Senate. It is unclear what exactly he did for the money; neither he nor the companies will say.

Finally, Center for Public Integrity researchers found that during his three terms in the Senate, political reformer Bradley went on one junket after another – more than 160 in all. In 1996, his last year in Congress, he took more all-expenses-paid trips than any other U.S. senator, 29—including jaunts to Switzerland and San Francisco.

John McCain

Arizona Senator John McCain’s most generous career patron is notorious savings-and-loan operator Charles Keating and his business and family associates, who contributed $112,000. McCain’s entire political career almost ended over the “Keating Five” scandal (McCain was one of five senators who met with federal bank regulators on Keating’s behalf. When the S&L failed, it cost taxpayers $2 billion. Besides the contributions, Keating’s corporate aircraft flew McCain and his family to vacation spots; McCain only belatedly repaid the cost of the transportation). The disgraced senator later wrote a check to the U.S. Treasury for $112,000, in the wake of the highly publicized Senate investigation that concluded he had “exercised poor judgment” but that his actions had not been “improper nor attended with gross negligence.” The two-year Senate ethics investigation ended with a mild rebuke for McCain and Sen. John Glenn of Ohio. The other three members of the were judged more severely.

Because of McCain’s check to the Treasury, Center for Public Integrity researchers did not count the Keating largesse in its “Top Ten Career Patrons” list.

Despite portraying himself as a plain-talking crusader who’s bucking the system, The Buying of the President 2000 reveals a politician who rarely breaks ranks with the special interests who finance his campaigns. Throughout his 18 years in the Senate, McCain has been an effective advocate for telephone carriers, railroads, real-estate developers and mining companies, among other interests.

McCain’s wife is a vice president of Hensley & Company, her father’s beer distributorship, one of the largest in the U.S. The company has given $80,300 to McCain throughout his political career – his No. 2 career patron – and the beer industry has given him much more. Although he has pledged to recuse himself from voting on legislation that affects the beer industry, as chairman of the Senate Commerce Committee, it is almost unavoidable. In 1998, many of the legislative priorities of the National Beer Wholesalers Association involved bills passing through his committee. In his nearly two decades in Congress, McCain has rarely opposed their interests.

McCain’s committee is a pivotal battleground, setting telecommunications policies for the next century. He appears to have taken legislative steps to protect some of his largest patrons. For example, he introduced the Internet Regulatory Freedom Act of 1999. US West, McCain’s actual top patron (excluding Keating), has contributed $107,520, and is just one company that stands to make millions if his bill becomes law. The company’s chairman, Solomon Trujillo, declared the day McCain introduced his bill that, “US West will be able to provide high-speed Internet service to an additional two million households and businesses throughout our region during the first year alone.”

Steve Forbes

Multimillionaire Malcolm “Steve” Forbes, who has never held elective office, has spent more money on his own presidential ambitions than any other candidate in U.S. history. But it is not well-known that Forbes gets state and federal tax breaks for raising cattle on his posh New Jersey farm. Without the cows, according to The Buying of the President 2000, this unlikely farmer’s land would be valued for tax purposes at $9 million, according to a local land assessor. With the cows, the land is assessed at only $160,531.

The Buying of the President 2000 also provides new information about the “Top 50 Patrons” of the two major political parties, which illuminates the relationships between the presidential candidates and their respective parties. For example, the top “soft money” (large, unlimited contributions) donor to the Republican Party since 1991 has been Philip Morris, contributing $6.2 million. Four of the GOP’s top 12 party patrons are tobacco companies, which in recent years have been repeatedly protected from federal government regulation by Republican lawmakers.

The top “soft money” donor to the Democratic Party since 1991 has been the American Federation of State, County, and Municipal Employees (AFSCME), contributing $3.67 million. Six of the top 10 party patrons are labor unions, and many of them, including AFSCME, have been beset by high-level corruption. Long considered one of the “clean” unions, in recent years no fewer than six AFSCME international vice presidents have been forced to resign. According to The Buying of the President 2000, “The White House and the Democratic Party have coddled and collaborated politically with union leaders who are well known to be corrupt.” The Center for Public Integrity was unable to find a single utterance by President Clinton or Vice President Gore about the serious, very real problem of union corruption.

For more than a year, roughly 24 researchers, writers and editors at the Center for Public Integrity gathered and analyzed tens of thousands of pages of government data and interviewed hundreds of people. The Buying of the President in 1996 was the first authoritative book identifying the special interests behind the major presidential contenders, issued a month before the first caucuses and primaries. It became a finalist for the Investigative Reporters and Editors (IRE) annual book award. Months after the book’s release, the Center broke the “Lincoln Bedroom” campaign finance scandal including the Clinton White House; its Public i report won the Society of Professional Journalists “Public Service” newsletter award. The Buying of the President 2000 is 30,000 words longer than the 1996 book, and contains lengthy chapters about the Democratic, Republican and Reform parties, as well as a list of the 50 most generous “Top Party Patrons” in the 1990s.