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Banned
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Thread starter (continued - part 2 of 3)
Quote:
http://www.google.com/search?hl=en&l...04&btnG=Search
Published on Sunday, May 23, 2004 by the Denver Post
When Advocates Become Regulators
President Bush has installed more than 100 top officials who were once lobbyists, attorneys or spokespeople for the
industries they oversee.
by Anne C. Mulkern
WASHINGTON -- In a New York City ballroom days before Christmas, a powerful Bush administration lawyer made an unprecedented
offer to drug companies, one likely to protect their profits and potentially hurt consumers.
Daniel E. Troy, lead counsel for the U.S. Food and Drug Administration, extended the government's help in torpedoing certain
lawsuits. Among Troy's targets: claims that medications caused devastating and unexpected side effects.
Pitch us lawsuits that we might get involved in, Troy told several hundred pharmaceutical attorneys, some of them old friends
and acquaintances from his previous role representing major U.S. pharmaceutical firms.
The offer by the FDA's top attorney, made Dec. 15 at the Plaza Hotel, took the agency responsible for food and drug safety
into new territory.
"The FDA is now in the business of helping lawsuit defendants, specifically the pharmaceutical companies," said James
O'Reilly, University of Cincinnati law professor and author of a book on the history of the FDA. "It's a dramatic change in
what the FDA has done in the past."
Troy's switch from industry advocate to industry regulator overseeing his former clients is a hallmark of President Bush's
administration.
Troy is one of more than 100 high-level officials under Bush who helped govern industries they once represented as lobbyists,
lawyers or company advocates, a Denver Post analysis shows.
In at least 20 cases, those former industry advocates have helped their agencies write, shape or push for policy shifts that
benefit their former industries. They knew which changes to make because they had pushed for them as industry advocates.
The president's political appointees are making or overseeing profound changes affecting drug laws, food policies, land use,
clean-air regulations and other key issues.
Government watchdogs call it a disturbing trend, not adequately restrained by existing ethics laws.
Among the advocates-turned-regulators are a former meat-industry lobbyist who helps decide how meat is labeled; a former
drug-company lobbyist who influences prescription-drug policies; a former energy lobbyist who, while still accepting payments
for bringing clients into his old lobbying firm, helps determine how much of the West those former clients can use for oil
and gas drilling.
"When you go to work in lobbying, it is clearly understood and accepted that your job is to advocate for the interests of
those who hired you," said Terry L. Cooper, a University of Southern California ethics and government professor. "When you go
to work in government, you are supposed to be responsible for upholding and maintaining whatever you can identify as the
public interest."
The Bush administration says the regulators were chosen for their abilities.
"The president appoints highly qualified individuals who make their decisions based on the best interests of the American
people," said White House spokesman Jim Morrell. "Any individual serving in the administration must abide by strict legal and
ethical guidelines, including full disclosure of past lobbying activities."
Six of the former industry advocates have faced ethics investigations or resigned amid conflict-of-interest charges. Those
and at least 14 others have been lambasted by public-interest groups.
Government ethics standards are part of the problem because they don't fully address the kind of issues that now permeate
Washington, Cooper and some inside government say. The rules focus mainly on direct financial conflicts. Other, more nuanced
conflicts aren't addressed
"There are so many ways around, over and under these (ethics) bans ... they almost never work," said Paul Light, who for
decades has studied the appointment process for the Brookings Institution, a think tank in Washington. "There're more screen
doors than steel doors."
A March 16 report from the Interior Department's inspector general, for example, concluded that department's "byzantine"
conflict-of-interest rules were "wholly incapable" of addressing ethical questions involving a former energy lobbyist, J.
Steven Griles, as the department's No. 2 official.
The report called the department's ethics system "a train wreck waiting to happen."
Bringing bias to a federal job isn't new. Presidents of all political persuasions have appointed people who shared their
party's values.
As president, Bill Clinton peppered the federal bureaucracy with Democratic state officials, lawyers and advocates from
various environmental or public-interest groups.
Only a handful of registered lobbyists worked for Clinton, however.
Bush's embrace of lobbyists marks a key difference because it allows "those who are affected by the regulations to determine
what the ground rules should be," said David Cohen, co-director of the Advocacy Institute, which helps teach nonprofits how
to lobby in Washington.
While previous Republican presidents hired lobbyists, "the Bush administration has made it rise in geometric proportions,"
Cohen said, meaning Bush is "capturing the instruments of government and using them for the ends" that favor Bush's political
supporters.
"In the Bush administration," said U.S. Sen. Joe Lieberman, D-Conn., "the foxes are guarding the foxes, and the middle-class
hens are getting plucked."
Republicans and their lobbying allies reject the idea that industry is embedded in the administration.
"Foxes? No," Vice President Dick Cheney told The Denver Post. "I think we have a good track record."
The clout of industry is balanced by the power of labor unions, trial lawyers and public-interest groups, said Jerry
Jasinowski, chairman of the National Association of Manufacturers.
"The notion that somehow business gets everything and we've gotten a free ride is absurd," he said.
Still, the lobbyists-turned-policymakers control or influence health care, food safety, land use, the environment and other
issues touched by government.
HEALTH CARE
Ann-Marie Lynch
The drug-industry lobbyist who fought price controls joined the Health and Human Services Department and has helped drug
companies avoid the limits.
Top aides in the Department of Health and Human Services provide analysis and advice to the president on key consumer issues,
including prescription-drug policies. In doing so, they consider the needs of pharmaceutical companies seeking revenue for
future research, and consumers struggling to afford increasingly costly medications.
In June 2001 Bush installed Ann- Marie Lynch, a lobbyist for the drug- company trade group Pharmaceutical Research and
Manufacturers of America, to help set those policies.
As a lobbyist, Lynch fought congressional attempts to cap prices for drugs. Price controls, she argued, would hamper medical
innovation.
Thirteen months after Lynch became deputy assistant secretary in the office of policy, her division issued a report that
praised brand- name drugs. It warned that "government-controlled restrictions on the coverage of new drugs could put the
future of medical innovation at risk and may retard advances in treatment."
Consumer advocates say that's nonsense. Other countries innovate despite price controls, said Gail Shearer, director of
health policy analysis for Consumers Union, nonprofit publisher of Consumer Reports.
"They haven't taken as seriously their job of making medicines affordable to all Americans," Shearer said. "When you talk
about the need for (drug) innovation, you have to put it in the context of, will people get the wonder drugs?"
Critics say the report influenced congressional debate over a Medicare drug policy that, among other things, banned
government from using Medicare's buying power to cut drug prices. The legislation will mean an extra $139 billion in profit
over eight years to drug companies, Boston University researchers said.
Republicans in Congress used arguments that came "directly out of Ann-Marie Lynch's mouth" and from the trade group she
previously worked for, said Rep. Sherrod Brown of Ohio, lead Democrat on the Energy and Commerce Committee's health
subcommittee.
Lynch declined to talk to a reporter. HHS spokesman Bill Pierce said the report was not intended to sway Congress. Provisions
banning Medicare from negotiating drug prices date to 2000, he said.
Lynch also blocked the release of about a dozen completed research reports that challenge drug-company claims, three former
employees said. Pierce said Lynch decides research topics and which reports are released.
One 2001 report, for example, criticizes Medicare plus Choice (now known as Medicare Advantage). Its findings suggested that
running the Medicare prescription-drug benefit through private health companies - the method the administration ultimately
chose - would be more expensive and would not serve rural areas well.
"Very few of (the private companies) manage to bring in the benefit cost effectively," said Mark Merlis, the private health
policy consultant who wrote the report.
Thomas A. Scully
The former hospital lobbyist presided over an agency that helped a chain he once represented win a favorable settlement in a
Medicare fraud case.
Thomas A. Scully represented the nation's for-profit hospitals as a lobbyist before being hired by the Bush administration in
June 2001 to head the federal Centers for Medicare & Medicaid Services.
Eight months after Scully arrived at the Medicare and Medicaid agency, it moved to settle final claims involving HCA Inc., a
hospital chain that was the biggest member of Scully's former employer, the Federation of American Hospitals. HCA Inc. faced
allegations it fraudulently overbilled the government for Medicare cases.
Under the terms agreed to in June 2002 by Scully's agency, HCA would have settled for $250 million. Medicare fraud cases
typically are ironed out with Justice Department participation, but Scully agreed to those terms on his own, said John R.
Phillips, an attorney who represented whistle-blowers in the case.
"The $250 million was a total sellout by Scully, who totally negotiated it behind Justice's back," Phillips said.
It also was handled in a way that protected the company from a full review of its cost reports and the triple- damage civil
fines that can be imposed in fraud cases, he said.
Sen. Charles Grassley, R-Iowa, asked Justice in October 2002 if that deal was "too lenient."
Justice delayed the settlement until June 2003.
HCA, the nation's biggest for-profit hospital company, eventually paid that $250 million, plus $631 million in civil
penalties and damages and $17.5 million to states.
Scully's ethics agreement did not require him to officially avoid cases involving HCA. But Scully said he steered clear.
"I recused myself from everything involving HCA-specific issues or policy and was not involved in any way, shape or form,"
Scully said. "Every time anything came up (regarding) HCA, I left it to my deputies."
But Grassley in a June 25, 2002, letter to a Justice Department lawyer said comments by Scully "have given me great concern
that there is an active, ongoing effort underway to change or modify enforcement (on Medicare fraud) policy that in my view
could significantly undermine the (law)."
Scully has since left the administration for consulting jobs with a lobbying firm and an investment company that represent
Medicare providers.
Daniel E. Troy
The lawyer who represented major drug companies still fights for causes that benefit them as chief counsel at the Food and
Drug Administration.
Daniel E. Troy was well-known at the FDA before he arrived in summer 2001 to work as chief counsel, the top legal position in
the department.
As a lawyer in private practice, Troy repeatedly sued the FDA, arguing that it had only limited ability to regulate drug
companies. He filed those suits through the Washington Legal Foundation, a group funded by businesses, including drug
companies. Donors include charitable foundations run by Pfizer Inc., Procter & Gamble Co. and Eli Lilly & Co.
Troy also represented Pfizer through his firm, Wiley, Rein & Fielding. Troy said in an e-mail to a reporter that his Pfizer
work was mainly communications and insurance law, and averaged only 80 hours a year.
At the FDA, Troy still is fighting for causes that benefit drug companies.
It's unclear whether any of pharmaceutical firms responded to his December request for lawsuits the FDA might get involved
in.
By the time Troy made that offer, he had already intervened in three drug-company cases as FDA chief counsel. One involved
Pfizer.
In court briefs, the FDA argued that it determines which warnings a drug company must give consumers. Lawsuits filed in state
courts arguing that drug-company warnings are inadequate therefore were invalid, the FDA says. One of the cases Troy
challenged involves thousands of consumers who say they were harmed by painful withdrawal from an antidepressant.
Lawsuits accusing drug companies of telling consumers too little about side effects constitute the largest category of cases
against drug companies, law professor O'Reilly said.
If Troy's legal position prevails, O'Reilly said, it would be catastrophic for consumers hurt by drugs. He said it would bar
cases like the one filed against the makers of fen-phen, the combination of diet medications tied to heart problems. The
makers of those drugs are settling with consumers for $14 billion. That case predates Troy's policy.
Troy, who declined to be interviewed, said in a written statement that the FDA is intervening in the lawsuits to protect "the
safety, effectiveness and availability of important medical products."
He said that would be "adversely affected if judges and juries acting under state law had the power to substitute their
judgment for the expert determinations made by FDA scientists."
Clinton's Justice Department, he added, took the same legal position, arguing that federal law pre-empts state law.
But prior to Troy, professor O'Reilly and one FDA official said, the government got involved only when a judge asked. Troy,
in contrast, is seeking cases in which to intervene.
And the FDA now is staking a new legal claim, experts say: that its authority to determine drug labeling always trumps any
claims made in state court.
The FDA is "taking sides in private litigation," said Thomas McGarity, a University of Texas Law School professor and
president of the Center for Progressive Regulation, which supports government regulation on health and safety issues.
The FDA asks drug-company attorneys to alert the agency to cases because otherwise "our rules might be undermined by contrary
state findings" the agency is unaware of, said Peter Pitts, an FDA spokesman.
He added: "For people to infer that (FDA) decisions are made with anything but the public health as our focus is untrue,
unfair and very ill-considered."
FDA officials also say they want to discourage frivolous lawsuits, which drive up costs.
A former FDA chief counsel in the Nixon administration, Peter Barton Hutt, said he supported the FDA's legal position but
added, "I probably wouldn't be out there encouraging" lawsuits.
Troy oversees other FDA changes that provoked accusations that he is siding with drug companies.
In October 2001, the Health and Human Services Department gave Troy's office final approval over warnings telling companies
they could be in violation of FDA rules. Those had previously been sent out by the FDA's drug-marketing division and district
offices.
After that change, the number of warnings of questionable claims by pharmaceutical companies quickly dropped from an average
of seven a month to two.
FDA spokesman Pitts said fewer letters were sent because the process was centralized.
"If you torture statistics long enough," Pitts said, "they confess to anything."
Others see this as dangerous to the public.
"This ... may be a welcome development for the drug industry, but it poses serious dangers to public health," Rep. Henry
Waxman of California, the top Democrat on the House Committee on Government Reform, said in an Oct. 1, 2002, letter to HHS
Secretary Tommy Thompson.
Waxman said the bad policy decision was "exacerbated by the appointment of Daniel Troy."
The investigative arm of Congress, the General Accounting Office, in October 2002 also found that, under the new system,
warning notices "have taken so long that misleading advertisements may have completed their broadcast life cycle before FDA
issued the letters."
Waxman described the delays as "a development that benefits the powerful pharmaceutical industry at the expense of
consumers."
FOOD SAFETY
Charles Lambert
As a USDA official, the former lobbyist for the meat industry who opposed labeling told a hearing that mad cow disease was
not a threat.
Mad cow disease had yet to surface in the United States last June when a U.S. Department of Agriculture official - a
meat-industry lobbyist only eight months earlier - bet his job on the promise that the ailment couldn't sneak into the
country through imports.
Congress had just passed a law requiring meat labels to state which country a cow lived in before slaughter. Food safety
groups say those labels could, among other things, help consumers avoid buying beef from countries with mad cow disease.
The USDA opposed such labeling. The person making the agency's case, Deputy Undersecretary Charles Lambert, knew the
arguments against such labels. He'd made them as a lobbyist for the National Cattlemen's Beef Association.
Lambert spent 15 years at the Cattlemen's Association working in Denver before coming to Washington, D.C., where he worked as
lobbyist and chief economist. He left in December 2002 to join the USDA as undersecretary for marketing and regulatory
programs.
When asked about mad cow and the labels, Lambert said mad cow disease wasn't a threat.
"Is there a possibility that it could get through?" Rep. Joe Baca, a California Democrat, asked Lambert at a hearing last
June.
Lambert answered, "No, sir."
"None at all?" Baca asked.
"No," Lambert replied.
"You would bet your life on it - your job on it, right?"
Lambert answered, "Yes, sir."
The disease was discovered in the U.S. six months later - apparently brought here by a cow from Canada.
Lambert now says, "I overstated my case."
More than a dozen other high-ranking USDA officials appointed under Bush also have ties to the meat industry.
"Whether it's intentional or not, USDA gives the impression of being a wholly owned subsidiary of America's cattlemen," said
Carol Tucker Foreman, director of the Consumer Federation of America's Food Policy Institute. She served as a USDA assistant
secretary in the Carter White House. "Their interests rather than the public interests predominate in USDA policy."
When he came to the USDA, Lambert signed an agreement stating that in his first year he would "not participate personally and
substantially in any particular matter involving specific parties in which (Cattlemen's) is a party or represents a party,
unless I am authorized to participate."
During that period he met at least 12 times with current or former members of Cattlemen's and its affiliates, an office
calendar obtained by The Denver Post shows.
Lambert said that at any meeting where policy was discussed, he acted only as a facilitator and that another USDA person was
present. The calendar shows meetings where other USDA people were present, although it is not always clear what was
discussed.
The rest of those meetings were at social settings, he said.
"You're not required to sever all personal and past relationships ... when you come to federal employment," Lambert said in
an interview.
ENVIRONMENT
Jeffrey Holmstead
The EPA official, a lawyer, formerly worked for a firm that represents utility companies, which are among the biggest air
polluters.
When the Environmental Protection Agency issued proposed changes to air pollution rules Jan. 30, the wording troubled Martha
Keating, a scientist with environmental advocacy group Clear the Air.
"It struck me that I had seen this before," Keating said.
At least 12 paragraphs were identical to or closely resembled a Sept. 4, 2003, proposal given to the Bush administration by
Latham & Watkins, a law firm that represents utility companies.
The EPA official overseeing the proposed changes is Jeffrey Holmstead, who until he joined the EPA in October 2001 had worked
as a lawyer at Latham & Watkins. His clients included a chemical company and a trade group for utility companies. Power
plants are among the biggest air polluters.
Holmstead oversees the EPA division that governs air pollution.
Environmental groups say the rewrite poses a health threat because it slows the reduction of mercury emissions by as much as
11 years. Those emissions can end up in water where they contaminate fish. Forty-three states have issued advisories about
fish consumption because of mercury pollution, the U.S. Public Interest Research Group said.
One effect of the proposal would be that 168 of 236 Western-based plants, including those in Colorado, would not be required
to reduce those emissions at all, Keating said.
Lobbyists commonly suggest wording for legislation. But even EPA Administrator Mike Leavitt objects to how this language was
lifted.
"To take something from a source without noting it doesn't seem to be the normal course of business, and it shouldn't have
been done," EPA spokeswoman Cynthia Bergman said, speaking for Leavitt.
Holmstead declined to comment.
Six Democratic senators are asking for an investigation. Ten attorneys general and 45 senators - including three Republicans
- have asked Leavitt to void the proposed rule because of undue industry influence.
The inspector general hasn't decided whether to investigate. Bergman said the final pollution rule is still under
development.
LAND USE
J. Steven Griles
The tenure of the veteran energy lobbyist at the Interior Department was labeled an "ethical quagmire" by the agency's
inspector general.
At the U.S. Department of the Interior, which oversees some 507 million acres of national parks, refuges and rangeland, top
officials weigh the competing merits of resource conservation and development.
Bush named J. Steven Griles, a veteran energy industry lobbyist, as the department's second-highest official in June 2001.
Griles earned $585,000 a year as a lobbyist, representing an array of oil, gas and other energy interests. As Interior's
deputy secretary, he continues to receive $284,000 a year for four years to pay him for the value he had created for the firm
by bringing in clients.
Upon entering the government, Griles had pledged to remove himself from deliberations that affected his former clients.
This year, the department's inspector general called Griles' tenure an "ethical quagmire."
"Mr. Griles' lax understanding of his ethics agreement and attendant recusals, combined with the lax dispensation of ethics
advice given to him, resulted in lax constraint over matters in which the deputy secretary involved himself," the inspector
general concluded.
That report or a subsequent review by the U.S. Office of Government Ethics found other issues:
A former business partner of Griles' hosted a party for Griles and top Interior officials for land and mining.
Also, a former Griles client, Advanced Power Technologies Inc., won some $2 million in no-bid contracts from his department
after two people Griles supervised pressed APTI's case.
And Griles urged the EPA not to press concerns over a plan to open 8 million acres in Wyoming and Montana to gas drilling by
companies including six of his former clients. The project is proceeding while a task force studies the matter.
The investigations of Griles found no illegalities. Secretary of the Interior Gale Norton announced that her right-hand man
had been "cleared."
Review of ethics guidelines
Neither the Bush administration nor Congress has called for a systematic review of government's ethics guidelines.
They should, says Stuart Gilman, president of the Ethics Resource Center, a nonprofit group in Washington that works with
companies and government groups.
"The question is, are we dealing with the problems we're currently confronting in government?" Gilman said.
Complaints about ethical breaches within government in some cases can be politically motivated, said Gilman, who also worked
in the Office of Government Ethics under Presidents George H.W. Bush and Clinton.
At the same time, Gilman said, governmental leaders have a responsibility to eliminate both real and perceived conflicts of
interest.
"For government to function, government must have the confidence of people," Gilman said. "If people don't believe the
government is acting fairly, it encourages everyone to cheat."
Denver Post staff writers John Aloysius Farrell and Mike Soraghan and researchers Tamania Davis, Barbara Hudson and Regina
Avila contributed to this report.
© Copyright 2004 The Denver Post
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Speaking of J. Stephen Griles......
Quote:
http://www.indiancountry.com/content.cfm?id=1096411513
Interior official implicated in Abramoff dealings
Posted: September 02, 2005
by: Gale Courey Toensing / Indian Country Today
WASHINGTON - A federal task force is investigating indicted lobbyist Jack Abramoff's claims that he offered a job to a deputy
secretary of the Interior Department who had promised to stop an Indian casino that would compete with one of the lobbyist's
tribal clients.
Abramoff sent e-mails in 2002 to Italia Federici, the head of a Washington conservative group, urging her to convince her
friend J. Steven Griles, then the Interior deputy secretary, to stop the Gun Lake Tribe of Pottawatomi Indians' plans to open
a casino near Grand Rapids, Mich., according to a report in The Washington Post.
Abramoff claimed that Griles was ''committed'' to blocking the Gun Lake tribe's casino efforts.
He later told two associates that he was trying to hire Griles to work for his firm, Greenberg Traurig, LLP. The associates
spoke on condition of anonymity because they are being investigated, the Post reported.
The task force is determining whether conflict of interest laws were violated. Government officials in decision-making
positions are prohibiting from considering job offers from potential employers who may be impacted by the officials'
decisions.
The Gun Lake casino was given the go-ahead by Interior in May after months of unexpected delays.
Tribal Chairman D.K. Sprague has called for a ''thorough investigation of these serious allegations. We have been denied our
federal rights, economic self-sufficiency and jobs that will benefit our community,'' Sprague said.......
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Quote:
http://www.washingtonpost.com/wp-dyn...2004Sep27.html
Foundation's Funds Diverted From Mission
Records Detail Spending By GOP Lobbyist Abramoff
By R. Jeffrey Smith
Washington Post Staff Writer
Tuesday, September 28, 2004; Page A01
The Capital Athletic Foundation's Web site portrays youths at play: shaking hands over a tennis net, learning how to hold a
bat, straining for a jump ball. Its text solicits donations for what it describes as "needy and deserving" sportsmanship
programs.
In its first four years of operation, the charity has collected nearly $6 million. A gala fundraiser last year at the
International Spy Museum at one point attracted the Washington Redskins' owner as its chairman and was to honor the
co-founder of America Online...............
......... Instead, the documents show that Jack Abramoff, one of Washington's high-powered Republican lobbyists, has
repeatedly channeled money from corporate clients into the foundation and spent the overwhelming portion of its money on pet
projects having little to do with the advertised sportsmanship programs, including political causes, a short-lived religious
school and an overseas golf trip.
The foundation's brief history -- now the subject of a federal investigation -- charts how Abramoff attached himself to House
Majority Leader Tom DeLay (R-Tex.) and, in so doing, became a magnet for large sums of money from business interests. It also
demonstrates how easily large amounts of such cash flowed through a nonprofit advocacy group to support the interests of a
director. ...........
............. Other recorded expenditures include $500 to help finance a memorial dinner two years ago in honor of the
Angolan rebel Jonas Savimbi, and $150,225 for a golf trip to Scotland aboard a private jet. Abramoff's guests on the August
2002 trip included two fellow lobbyists, the Republican chairman of the House Administration Committee and a senior official
at the General Services Administration.
Those and other expenditures by the foundation have sparked wide-ranging investigations by the Justice Department, the
Internal Revenue Service and two congressional committees............
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Quote:
http://www.texasobserver.org/showArt...p?ArticleID=13
The Pimping of the President
Jack Abramoff and Grover Norquist Billing Clients for Face Time with G.W. Bush
BY LOU DUBOSE
our months after he took the oath of office in 2001, President George W. Bush was the attraction, and the White House the
venue, for a fundraiser organized by the alleged perpetrator of the largest billing fraud in the history of corporate
lobbying. In May 2001, Jack Abramoff’s lobbying client book was worth $4.1 million in annual billing for the Greenberg
Traurig law firm. He was a friend of Bush advisor Karl Rove. He was a Bush “Pioneer,” delivering at least $100,000 in bundled
contributions to the 2000 campaign. He had just concluded his work on the Bush Transition Team as an advisor to the
Department of the Interior. He had sent his personal assistant Susan Ralston to the White House to work as Rove’s personal
assistant. He was a close friend, advisor, and high-dollar fundraiser for the most powerful man in Congress, Tom DeLay.
Abramoff was so closely tied to the Bush Administration that he could, and did, charge two of his clients $25,000 for a White
House lunch date and a meeting with the President. From the same two clients he took to the White House in May 2001, Abramoff
also obtained $2.5 million in contributions for a non-profit foundation he and his wife operated.
Abramoff’s White House guests were the chiefs of two of the six casino-rich Indian tribes he and his partner Mike Scanlon
ultimately billed $82 million for services tribal leaders now claim were never performed or were improperly performed.
Together the six tribes would make $10 million in political contributions, at Abramoff’s direction, almost all of it to
Republican campaigns of his choosing. On May 9, 2001, when he ushered the two tribal chiefs into the White House to meet the
President, The Washington Post story that would end his lobbying career and begin two Senate Committee investigations was
three years away. (When the Post story broke in February 2004, however, Abramoff and Scanlon, a former Tom DeLay press aide,
were already targets of a U.S. Attorney’s investigation in Washington.)
Abramoff brought the Coushatta and Choctaw chiefs to Washington at the request of Grover Norquist. Norquist is founder and
director of Americans for Tax Reform, the advocacy group committed to slashing taxes until the federal government is so small
you “can drown it in the bathtub.” Norquist started ATR in 1985. His power increased exponentially in 1994, when Republicans
took control of the House of Representatives and he collaborated with then-Majority Whip Tom DeLay to launch the “K Street
Project”—a coordinated campaign to compel lobbyists to contribute only to Republican candidates and ultimately to hire only
Republicans. Like Abramoff and Rove, Norquist considered George Bush’s victory over Al Gore the culmination of a project the
three Washington insiders started 30 years ago as national leaders of the College Republicans.
Since the Post’s Susan Schmidt broke the Jack Abramoff story, the media has focused on the stunning $82 million Abramoff and
Scanlon billed six tribes for lobbying and public relations work. Far less attention has been paid to the political
contributions, by Abramoff’s account $10 million, made by the six tribes. That piece of the story involves the K Street
Project, which moves the money of corporate lobbyists and their clients into the accounts of Republican candidates, PACs, and
issue advocacy groups.
Republican Campaign Accounts
Abramoff advised tribal leaders that the contributions were the cost of doing business in Washington, where he could protect
them from other tribes trying to open casinos to compete with those that already had them. He sent orders for the checks to
be cut, designating each recipient. On March 6, 2002, for example, Coushatta Tribal Council Chair Lovelin Poncho followed
Abramoff’s orders and disbursed $336,300 in tribal funds, according to tribal accounting ledgers obtained by the Observer.
The Coushattas, a southwest Louisiana tribe of 837 members, operate a casino that does an estimated $300 million in annual
business. The $32 million they paid Abramoff and Scanlon makes the tribe the largest victim of the fraud their lawyers now
allege in a lawsuit filed by Texas plaintiff’s firm Provost Umphrey. The tribe also contributed what tribal council member
David Sickey said was probably “many millions” of dollars to political causes and charities designated by Abramoff.
Since we first reported the White House ATR fundraiser and the $1 million contribution to the Capital Athletic Foundation
(see “K Street Croupiers,” November 19, 2004), the Coushattas, speaking through Austin attorneys at Hance, Scarborough,
Wright, Ginsburg & Brusilow, and through Louisiana political consultant Roy Fletcher, have vociferously denied that tribal
Chairman Poncho visited the White House after contributing $25,000 to ATR. They also denied the $1 million contribution to
Abramoff’s foundation. Recently the story has changed. Or at least the version told by the majority that controls the council
has begun to change. Two minority members of the five-seat council have pointed to the pay-to-play meeting with President
Bush and the $1 million contribution to Abramoff as examples of the council’s financial mismanagement. One of the two members
of the minority faction, David Sickey, has regularly made himself available to the press. Normally, press inquiries to the
council majority are answered by Hance Scarborough, by Roy Fletcher, or occasionally by sources close to the council
majority.
According to a source close to the tribal majority, Chairman Poncho recently “revisited that issue” of his visit to the White
House. He had previously denied it because he thought he was responding to press inquiries that implied he had a one-on-one
meeting with Bush. He now recalls that he in fact did go to the White House on May 9, 2001. Tribal attorney Kathryn Fowler
Van Hoof went with him, although she did not get into the meeting with the President. That meeting lasted for about 15
minutes and was not a one-on-one meeting. At the meeting, Bush made some general comments about Indian policy but did not
discuss Indian gaming. Abramoff was at the meeting—for which he charged the Coushatta Tribe $25,000. The change in Poncho’s
position is odd in light of the fact that he and his spokespersons have maintained for more than a year that he did not meet
with President Bush in May 2001.
Norquist has not responded to inquiries about using the White House as a fundraiser. It is, however, a regular ATR practice
to invite state legislators and tribal leaders who have supported ATR anti-tax initiatives to the White House for a personal
thank-you from the President. A source at ATR said no money is ever accepted from participants in these events. The $25,000
check from the Coushattas suggests that, at least in this instance, Norquist’s organization made an exception. The $75,000
collected from the Mississippi Choctaws and two corporate sponsors mentioned in Abramoff’s e-mail suggests there were other
exceptions. Norquist recently wrote to the tribes who paid to attend White House meetings. His story regarding that event is
also evolving. The contributions, he told tribal leaders in letters that went out in May, were in no way related to any White
House event. That doesn’t square with the paper trail Abramoff and Norquist left behind, which makes it evident that they
were selling access to the President.
The Coushatta Tribal Council majority has also revised its response to questions about the $1 million contribution, which
critics in the tribe have insisted was made to Abramoff’s Capital Athletic Foundation in 2001. The foundation funded
Abramoff’s Jewish prep school in Bethesda, MD, which closed soon after his lobbying scheme unraveled. When the Observer
inquired in November 2004 about the $1 million contribution, we had obtained a copy of the Capital Athletic Foundation’s tax
filing, but the contributor’s name was redacted. Following the lead of Lake Charles, Louisiana, American Press reporter Shawn
Martin, the Observer last week obtained an un-redacted copy. The $1 million contribution, roughly 95 percent of what the
foundation raised in 2001, was attributed to the Coushatta Tribe. A source working with the Coushatta Tribal Council majority
said it now appears that the contribution was made in response to a bill sent by Mike Scanlon. Accountants working under the
direction of Hance Scarborough found a $1-million Greenberg Traurig invoice that Scanlon sent the tribe. Scanlon routinely
sent un-itemized bills for larger sums, which the tribe routinely paid. But as he was not a Greenberg Traurig employee, he
billed on his own Capitol Campaign Strategies invoices. On the $1 million Greenberg Traurig invoice Scanlon sent the tribe in
2001, the company name was misspelled.
There will need to be more accounting, probably by different accountants. And perhaps by different legal representation, or
at least under a different understanding between the tribe and its lawyers. In the May 28 tribal election on the Elton, LA
reservation, a reform slate won a majority on the five-member council. Sickey, who five days before the election maintained
that the $1 million contribution was made and that tribal chair Poncho indeed went to the White House in 2001, predicted the
new majority will hire forensic accountants to determine where all the money went. (A week before the election he was looking
for a tribal newsletter in which, he said, Poncho described his 2001 White House visit.) The shift on the council does not
bode well for its Austin law firm. Hance Scarborough had gone to tribal court and successfully blocked a recall election that
would have forced the council majority to stand for election a year ago, and David Sickey was a proponent of the recall.
“Kent Hance doesn’t represent me or [the other minority dissident] Harold John,” said Sickey. “He represents Lovelin Poncho.”
The White House press office has not responded to our questions about other visits Jack Abramoff might have made to the White
House or about Norquist using the official residence of the President to raise funds for Americans for Tax Reform. None of
the political contributions Abramoff insisted the tribes make as yet have been returned.
Lou Dubose is a former Observer editor and co-author of The Hammer: Tom DeLay, God, Money and the Rise of the Republican
Congress. This story was written with support from the Fund for Constitutional Government.
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