Isn't this a conflict of interest? Government Motors hiring lobbyists to use taxpayers money to influence government at the top? Sort of like government bribing government?
GM rehires lobbyists -- and taxpayers foot the bill By: Timothy P. Carney Examiner Columnist December 30, 2009
If you've flown into Ronald Reagan Washington National Airport and your plane took the northern approach coming down the Potomac, you may have looked out the window at the five-, six- or seven-bedroom homes on both the Maryland and Virginia sides of the river, with three-car garages and swimming pools. Thanks to the Obama administration and General Motors, your tax dollars are now subsidizing the millionaire lobbyists who live in these neighborhoods.
GM, the failed carmaker whose $400 million in monthly losses is borne mostly by U.S. taxpayers, has in recent months hired high-priced K Street lobbyists to petition Washington for subsidies, special tax breaks and other government favors on top of the $52 billion in aid the Treasury has already provided.
In June, GM began firing its outside lobbyists as part of downsizing its entire $10 million-a-year lobbying operation. As company spokesman Greg Martin told Roll Call, "We have begun notifying our outside consultants that we will be terminating their contracts." But GM has since rehired two of its old K Street firms, the Duberstein Group and Greenberg Traurig, and picked up new representation in the firm GrayLoeffler.
Rounding out GM's K Street quartet is the well-connected Washington Tax Group, which began representing the company in 2007 and kept its affiliation with GM over the summer, according to a search of the House and Senate lobbying databases. GM's Martin told me Monday that these were GM's only outside lobbying firms.
Among the four firms, 18 lobbyists are registered to represent GM, including many wealthy and well-connected revolving-door players from both parties.
Former Reps. William Gray III, D-Pa., and Jim Bacchus, R-Fla., are both on GM retainer, as are fabled Republican and Democratic operatives Ken Duberstein (White House chief of staff under Ronald Reagan) and Michael Berman (counsel to Vice President Walter Mondale and campaign aide to every Democratic presidential nominee since LBJ).
Heading GM's lobbying push for expanded R&D tax credits is the Washington Tax Group's Gregory Nickerson, formerly the top lawyer at the tax-writing House Ways and Means Committee and the staff director of the Subcommittee on Select Revenue Measures. Nickerson's partner is Mary Ellen McCarthy, formerly the top lawyer at the Senate's tax-writing Finance Committee.
Such well-connected hired guns don't come cheap. Martin wouldn't tell me what rates his bailed-out employer is paying the newly hired or rehired firms (the information will be public by the end of January), but Duberstein Group's average quarterly fee last quarter was $94,000, while Greenberg Traurig's was $40,000 and GrayLoeffler's was $28,000. In the third quarter, GM paid the Washington Tax Group $25,000.
GM, of course, is still owned mostly by the federal government and is still losing money -- $1.2 billion in the third quarter. That means the company's expenses are the taxpayer's expenses. That means you are paying these lobbying fees. Put another way, the Obama administration, through GM, is transferring wealth from average Americans to millionaire former public officials.
The home values of 13 of GM's 18 lobbyists can be found in public records. The mean assessed value of those homes was $1.13 million. Three of GM's lobbyists have homes valued at more than $1.5 million, including one whose home is worth $2.97 million. Your taxes are paying to shine the chandeliers in these posh palaces.
I contacted the White House and the Treasury Department to ask whether the administration found this arrangement appropriate, but neither returned my calls and e-mails. None of the lobbying firms returned calls or e-mails, either.
GM's Martin, however, called me back despite the holiday and referred me to a statement GM issued back in June, which read, in part: "We believe we have an obligation to remain engaged at the federal and state levels and to have our voice heard in the policymaking process."
Why did GM fire its lobbyists and then hire them again? Martin explained that it got rid of its outside lobbyists while it was bankrupt, but now that the company has emerged from bankruptcy, although it is still under government ownership, GM is lobbying again.
The auto bailouts of Presidents Bush and Obama teach us once again that when government gets bigger, it's the well-off who fare the best.
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