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Backstage @ Our Dog & Pony Show

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  • Backstage @ Our Dog & Pony Show

    Selling out pays. If you’re a corporation or lobbyist, what’s the best way to “buy” a member of Congress? Secretly promise them a million dollars or more in pay if they come to work for you after they leave office. Once a public official makes a deal to go to work for a lobbying firm or corporation after leaving office, he or she becomes loyal to the future employer. And since those deals are done in secret, legislators are largely free to pass laws, special tax cuts, or earmarks that benefit their future employer with little or no accountability to the public. While campaign contributions and super PACS are a big problem, the every day bribery of the revolving door may be the most pernicious form of corruption today. (See our post on Monday about current members of Congress already negotiating for jobs on K Street)

    Unlike some other forms of money in politics, politicians never have to disclose job negotiations while in office, and never have to disclose how much they’re paid after leaving office. In many cases, these types of revolving door arrangements drastically shape the laws we all live under. For example, former Senator Judd Gregg (R-NH) spent his last year in office fighting reforms to bring greater transparency to the derivatives marketplace. Almost as soon as he left office, he joined the board of a derivatives trading company and became an “advisor” to Goldman Sachs. Risky derivative trading exacerbated the financial crisis of 2008, yet we’re stuck under the laws written in part by Gregg. How much has he made from the deal? Were his actions in office influenced by relationships with his future employers?

    Republic Report combed through the few disclosures that are out there to find out how much lawmakers make when they sell out and lobby for interests they once oversaw as public officials. To be sure, this list only shows the tip of the iceberg (out of the 44 lawmakers who left office in 2010 for a lobbying-related career, only one is at an organization that discloses his salary).

    Our research effort uncovered the partial salaries of twelve lawmakers-turned-lobbyists. Republic Report’s investigation found that lawmakers increased their salary by 1452% on average from the last year they were in office to the latest publicly available disclosure:



    Former Congressman Billy Tauzin (R-LA) made $19,359,927 as a lobbyist for pharmaceutical companies between 2006 and 2010
    . Tauzin retired from Congress in 2005, shortly after leading the passage of President Bush’s prescription drug expansion. He was recruited to lead PhRMA, a lobbying association for Pfizer, Bayer, and other top drug companies. During the health reform debate, the former congressman helped his association block a proposal to allow Medicare to negotiate for drug prices, a major concession that extended the policies enacted in Tauzin’s original Medicare drug-purchasing scheme. Tauzin left PhRMA in late 2010. He was paid over $11 million in his last year at the trade group. Comparing Tauzin’s salary during his last year as congressman and his last year as head of PhRMA, his salary went up 7110%.




    Former Congressman Cal Dooley (D-CA) has made at least $4,719,093 as a lobbyist for food manufacturers and the chemical industry from 2005 to 2009.
    Republic Report analyzed disclosures from the Grocery Manufacturers Association (GMA), an industry lobby — for companies like Kellogg — where Dooley worked following his retirement from Congress. We also added in Dooley’s salary from the American Chemistry Council, where Dooley now works as the president. The Chemistry Council represents Dow Chemical, DuPont, and other chemical interests. Dooley’s salary jumped 1357% between his last year in the House and his last reported salary for the Chemistry Council in 2009.




    Former Senator Chris Dodd (D-CT) makes approximately $1.5 million a year as the chief lobbyist for the movie industry
    . Dodd, who retired from the Senate after 2010, was hired by the Motion Picture Association of America, the lobbying association that represents major studios like Warner Bros. and Universal Studios. Although the MPAA would not confirm with Republic Report Dodd’s exact salary, media accounts point to $1.5 million, a slightly higher figure than the previous MPAA head, former Secretary of Agriculture Dan Glickman. Dodd received about a 762% raise after moving from public office to lobbying.




    Former Congressman Steve Largent (R-OK) has made at least $8,815,741 over the years as a lobbyist for a coalition of cell phone companies and related wireless industry interests
    . Republic Report analyzed disclosures from CTIA-The Wireless Association, the trade group Largent leads. CTIA counts wireless companies like AT&T, HTC, and Motorola as members. Largent left Congress in 2002, when his pay was about $150,000 as a public official. His move to the CTIA trade association, where he earns slightly more than $1.5 million a year according to the latest disclosure form, raised his salary by 912%.




    Former Senator Tom Daschle (D-SD) makes well over $2.1 million as an unregistered lobbyist in addition to earning several hundred thousand a year in speaking fees and consulting gigs
    . When Daschle lost his seat in the Senate, he went work for the lobbying/law firm Alston & Bird, while also providing advice to lobbying firms like the Glover Park Group, AHIP, the health insurance lobbying association, and several well-connected private equity and medical device companies. Although Daschle never registered to lobby, his sky-high income became public when President Obama unsuccessfully nominated the former Democratic majority leader to be Secretary of Health and Human Services. Daschle now works at DLA Piper, another major law/lobbying firm, where he likely makes far more than his Alston & Bird salary of $2.1 million given Daschle’s significant role in crafting President Obama’s health reform proposals. Not counting the speaking fees, Daschle achieved a 1228% salary increase by moving through the revolving door.




    Former Congressman Richard Baker (R-LA) made $3,219,255 between 2008 and 2009 as head of a hedge fund lobbying association
    . Republic Report reviewed disclosures from the Managed Funds Association, a group that represents hedge funds including Caxton Associations, Magnetar Capital, and Third Point LLC. In Congress, as a member of the influential House Financial Services Committee, Baker oversaw efforts to relax regulations governing Wall Street. Baker’s salary went up 956% after he left office.




    Former Congressman Jim Slattery (D-OK) makes around $585,000 a year as a lobbyist for Wiley Rein
    . Slattery left Congress in 1994 to run for higher office. He didn’t win. Instead, he went to work for the law/lobbying firm Wiley Rein. When Slattery again ran for statewide office in 2008 against Senator Pat Roberts (R-KS), his mandatory financial disclosure revealed that he earned $585,000 in 2007, representing clients like Verizon Communications and Nucor Corp. Comparing his 1994 House salary with his 2007 income from Wiley Rein, Slattery’s pay jumped 337%.




    Former Congressman James Greenwood (R-PA) made $6,679,935 between 2005 and 2010 as the head of the Biotechnology Industry Organization
    . Greenwood took the job with BIO in 2004, and still leads the association, which lobbies on a wide variety of issues on behalf of industry, including genetically modified foods and biofuels. BIO members include Amgen, MedImmune, Novo Nordisk, Genentech, and Human Genone Sciences. Greenwood’s salary shot up 671% between his last year in office and his BIO salary in 2009.




    Former Congressman Glenn English (D-OK) made $9,294,207 between 2004 and 2010 as the head of the National Rural Electric Cooperative Association
    . English, who represents many coal-dependent electric cooperatives, played a significant role in weakening climate reform legislation in 2009. Although English became head of the NREOA after 1994, Republic Report only had access to disclosures for a six year period. Comparing his congressional salary in 1994 and his last reported lobbying salary in 2009, English’s pay went up 1504%.




    Former Congressman Steve Bartlett (R-TX) has made at least $9,192,761 as the chief lobbyist for an association of investment banks, including Goldman Sachs, Citigroup, and JP Morgan Chase
    . Bartlett has worked as the head of the Financial Services Roundtable, a trade association he joined in 1999. Republic Report could only obtain disclosures from recent years, providing us an incomplete picture of his salary. Bartlett’s salary at the Financial Services Roundtable is 1770% higher than his last year in Congress.




    Former Congressman Matt Salmon (R-AZ) makes around $247,523 a year as a registered lobbyist
    . Salmon, who retired from Congress in 2001, has represented corporate clients like General Motors and Grand Canyon University (a for-profit college) through a lobbying firm he founded, Upstream Consulting Inc. (Although his income boost was lower than most of his fellow Members-turned-lobbyists, Salmon does get props for the witty firm name.) Salmon announced his intention to run again for Congress, so Republic Report reviewed mandatory candidate disclosures filed by the candidate. The forms reveal that Salmon also receives consulting fees from Policy Impact Strategic Communicators, another lobbying company, as well as nearly $50,000 a year from a company called Solid Ground Solutions. At Policy Impact Strategic Communications, Salmon represented the Republic of Kazahkstan. Salmon enjoyed a 75% salary boost by moving from Congress to K Street.




    Former Senator Gordon Smith (R-OR) has made at least $1,650,005 as a media broadcasting industry lobbyist since 2009
    . Smith is president of the National Association of Broadcasters, a trade group for companies like News Corp and Time Warner. Republic Report has not reviewed NAB disclosures from 2011. Smith’s last reported broadcasting lobby salary is 742% higher than his Senate salary in 2008.

    http://www.republicreport.org/2012/m...evolving-door/

  • #2
    Re: Backstage @ Our Dog & Pony Show

    Originally posted by don View Post
    Selling out pays. If you’re a corporation or lobbyist, what’s the best way to “buy” a member of Congress? Secretly promise them a million dollars or more in pay if they come to work for you after they leave office..... Republic Report’s investigation found that lawmakers increased their salary by 1452% on average from the last year they were in office to the latest publicly available disclosure

    http://www.republicreport.org/2012/m...evolving-door/

    i propose an IMMEDIATE surtax on all income derived from these activities of 90%

    and if obama&co are really serious about 'raising taxes on the rich' ?
    he do this RIGHT NOW by executive order!
    (of course we have about as much chance of that happening as congress balancing the budget, but we can dream.... on)

    Comment


    • #3
      Re: Backstage @ Our Dog & Pony Show

      Why not just make corporate lobbying where $$ payments to congressmen & senators is involved illegal all together? Why can't the USA just have congress & senators receive an honest paycheque for their work instead of aiming for those positions so they can profit massively from corporate lobbiests or promises of high paying jobs rife in conflict of interest? And as the article suggests, why not SHUT the revolving door all together. While we're at it, make it apply to the Treasury and Federal Reserve as well.

      Oh right, I forgot. The people empowered to make those changes are the ones profiting from it not happening. Even Ron Paul isn't a proponent of not changing this for some reason. I'm not sure I understand why, given his apparent altruism.

      "Congress is bought" is one of the major problems I see with the USA. Coporatism is far from democracy, and a large risk to free market capitalism. Greed is only good from the perspective of those getting fed, everybody else suffers.
      Last edited by Adeptus; March 16, 2012, 02:55 PM.
      Warning: Network Engineer talking economics!

      Comment


      • #4
        Re: Backstage @ Our Dog & Pony Show

        Originally posted by Adeptus View Post
        Why not just make corporate lobbying where $$ payments to congressmen & senators is involved illegal all together? Why can't the USA just have congress & senators receive an honest paycheque for their work instead of..... .

        ...
        why oh why is that so tough to comprehend?

        the answer is the LIFETIME BENEFITS associated with elevation to the 'beltway lifestyle' = pure corruption of the highest order... it is a system that they themselves have created to benefit only themselves

        why i say that NH is The Gold Standard on how the .gov ought to be run.

        NH legislators clearly are NOT in it for the money, not when they get paid 100bux a year...
        and manage to keep NH in the top 10 in per capita income, bottom 10 in total taxation, along with upper quintile results in education, infrastructure, best roads in the northeast, relatively low crime and a small welfare class that no doubt finds it VERY difficult to survive (never mind breed/out produce the working class)

        and the best part of NO SALES TAXES AND NO INCOME TAXES?

        there aint NO money for the political class to play their usual games with and even less to create/grow a HUGE buracracy, staffed with directors, deputy directors, assistant deputy directors, secrataries to the assistant deputy directors, ad nauseum that serves no function other than to make life as complicated, difficult and expensive fo The Rest Of US as they can make it...

        and i've had first hand experience over the past 22 years of exactly how this occurs and works out.
        (and its not pretty...)

        and say/think what you will of her, but ole sarah makes the point MUCH better than i ever could:

        http://online.wsj.com/article/SB1000...463191222.html

        Originally posted by wsj/palin

        • November 18, 2011

        How Congress Occupied Wall Street

        Politicians who arrive in Washington as men and women of modest means leave as millionaires. Why?

        By SARAH PALIN

        Mark Twain famously wrote, "There is no distinctly native American criminal class except Congress." Peter Schweizer's new book, "Throw Them All Out," reveals this permanent political class in all its arrogant glory. (Full disclosure: Mr. Schweizer is employed by my political action committee as a foreign-policy adviser.)
        Mr. Schweizer answers the questions so many of us have asked. I addressed this in a speech in Iowa last Labor Day weekend. How do politicians who arrive in Washington, D.C. as men and women of modest means leave as millionaires? How do they miraculously accumulate wealth at a rate faster than the rest of us? How do politicians' stock portfolios outperform even the best hedge-fund managers'? I answered the question in that speech: Politicians derive power from the authority of their office and their access to our tax dollars, and they use that power to enrich and shield themselves.
        Enlarge Image


        Close



        Associated Press


        The money-making opportunities for politicians are myriad, and Mr. Schweizer details the most lucrative methods: accepting sweetheart gifts of IPO stock from companies seeking to influence legislation, practicing insider trading with nonpublic government information, earmarking projects that benefit personal real estate holdings, and even subtly extorting campaign donations through the threat of legislation unfavorable to an industry. The list goes on and on, and it's sickening.
        Astonishingly, none of this is technically illegal, at least not for Congress. Members of Congress exempt themselves from the laws they apply to the rest of us. That includes laws that protect whistleblowers (nothing prevents members of Congress from retaliating against staffers who shine light on corruption) and Freedom of Information Act requests (it's easier to get classified documents from the CIA than from a congressional office).
        The corruption isn't confined to one political party or just a few bad apples. It's an endemic problem encompassing leadership on both sides of the aisle. It's an entire system of public servants feathering their own nests.
        None of this surprises me. I've been fighting this type of corruption and cronyism my entire political career. For years Alaskans suspected that our lawmakers and state administrators were in the pockets of the big oil companies to the detriment of ordinary Alaskans. We knew we were being taken for a ride, but it took FBI wiretaps to finally capture lawmakers in the act of selling their votes. In the wake of politicos being carted off to prison, my administration enacted reforms based on transparency and accountability to prevent this from happening again.
        We were successful because we had the righteous indignation of Alaskan citizens on our side. Our good ol' boy political class in Juneau was definitely not with us. Business was good for them, so why would they want to end "business as usual"?
        The moment you threaten to strip politicians of their legal graft, they'll moan that they can't govern effectively without it. Perhaps they'll gravitate toward reform, but often their idea of reform is to limit the right of "We the people" to exercise our freedom of speech in the political process.
        I've learned from local, state and national political experience that the only solution to entrenched corruption is sudden and relentless reform. Sudden because our permanent political class is adept at changing the subject to divert the public's attention—and we can no longer afford to be indifferent to this system of graft when our country is going bankrupt. Reform must be relentless because fighting corruption is like a game of whack-a-mole. You knock it down in one area only to see it pop up in another.
        What are the solutions? We need reform that provides real transparency. Congress should be subject to the Freedom of Information Act like everyone else. We need more detailed financial disclosure reports, and members should submit reports much more often than once a year. All stock transactions above $5,000 should be disclosed within five days.
        We need equality under the law. From now on, laws that apply to the private sector must apply to Congress, including whistleblower, conflict-of-interest and insider-trading laws. Trading on nonpublic government information should be illegal both for those who pass on the information and those who trade on it. (This should close the loophole of the blind trusts that aren't really blind because they're managed by family members or friends.)
        No more sweetheart land deals with campaign contributors. No gifts of IPO shares. No trading of stocks related to committee assignments. No earmarks where the congressman receives a direct benefit. No accepting campaign contributions while Congress is in session. No lobbyists as family members, and no transitioning into a lobbying career after leaving office. No more revolving door, ever.
        This call for real reform must transcend political parties. The grass-roots movements of the right and the left should embrace this. The tea party's mission has always been opposition to waste and crony capitalism, and the Occupy protesters must realize that Washington politicians have been "Occupying Wall Street" long before anyone pitched a tent in Zuccotti Park.


        Ms. Palin, a former governor of Alaska, was the Republican nominee for vice president in 2008.


        Last edited by lektrode; March 16, 2012, 05:29 PM.

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        • #5
          Re: Backstage @ Our Dog & Pony Show

          Under Pressure, New York Moves to Soften Tough Medicaid Audits

          By NINA BERNSTEIN

          New York State was paying for the medical care of dead people when Gov. George E. Pataki and the State Legislature created the Office of the Medicaid Inspector General to curb billions of dollars in fraud and misspending by health care providers.

          The turnaround was startling. Within four years the state had recouped $1.5 billion in Medicaid overpayments, the highest recovery rate in the nation. Other states rushed to create inspectors general like New York’s.

          But a backlash from the politically powerful health care industry has erased broad support for the crackdown. Last year, amid a crescendo of provider complaints of overzealous, nitpicking audits and unfair tactics, Gov. Andrew M. Cuomo quietly dismissed the state’s first Medicaid inspector general, James G. Sheehan, and directed Mr. Sheehan’s successor, James C. Cox, to collaborate with providers on changes to the agency’s policies and auditing methods.

          In an interview, James Introne, Mr. Cuomo’s deputy secretary for health, expressed the state’s new view.

          “An audit need not be an adversarial enterprise,” Mr. Introne said. “To the extent that an audit turns into an adversarial affair, it may not be conducted properly. An audit is successful when people agree.”

          The Cuomo administration said that enforcement was as vigorous as ever, and that Mr. Cox was on target to avoid $1.1 billion in improper Medicaid spending this year, even more than his predecessor. But veterans of Medicaid policing pointed to important audits that were started by Mr. Sheehan but have not been released, and said the inspector general’s office was at a difficult crossroads, caught between the Legislature’s allegiances to campaign contributors from the health care field and the governor’s plans to cut Medicaid costs, which depend on the goodwill of nursing homes, hospitals and home health agencies.

          “An industry that’s regulated doesn’t love the regulator unless the regulator isn’t doing much,” said Arthur A. Levin, the longtime director of the Center for Medical Consumers, a nonprofit advocacy organization, who admired Mr. Sheehan. “Asking the regulator and the regulated party to sit down and come to some sort of consensus on how the regulation should be — to me, it makes no sense.”

          Michael A. Zegarelli, a past president of the national association of Medicaid oversight officials and a senior regulator in New York until 2003, said that by definition, an audit that found overbilling, fraud or waste was “going to be adversarial.”

          “Sheehan’s successor will have a short leash,” Mr. Zegarelli said. “Will that be for the benefit of the program, or to keep Cuomo’s constituency happy?”

          New York’s Medicaid program, jointly financed by federal, state and local taxpayers, is the nation’s largest, at $53 billion. In 2005, an investigation by The New York Times found that Health Department regulators had uncovered only 37 cases of suspected fraud in 400 million annual claims, overlooking red flags like a storefront dentist whose billings spiked to 991 procedures daily and a nursing-home operator who took in $1.5 million in salary and profit the same year he was fined for neglecting the home’s residents.

          The 2006 overhaul spurred by that investigation was financed by a $1.5 billion payment from the federal government with tough terms: the state had to recoup the money by September 2011 or pay back the shortfall. To take charge, Gov. Eliot Spitzer in 2007 appointed Mr. Sheehan, who had prosecuted health care fraud for 20 years as an assistant United States attorney in Philadelphia.

          Mr. Sheehan exceeded recovery targets. Over all, the state reclaimed 1.2 percent of its total Medicaid spending, the nation’s highest rate.

          But complaints from providers mounted, and were taken up by legislators. The providers charged that under pressure to meet the federal target, Mr. Sheehan treated paperwork errors like fraud. At one legislative hearing, he was accused of “gangster tactics” for demanding that providers settle with the state or risk having to pay more based on findings extrapolated from statistical samples.

          “Jim Sheehan was able to make up his own rules,” said Richard J. Herrick, president of the New York State Health Facilities Association, a nursing-home trade group. “It wasn’t for purity, it was where can we find money to recoup.”

          In June, Mr. Sheehan was dismissed with a month’s notice in a phone call from Mr. Cuomo’s director of operations.

          “He said, ‘We’ve decided to go in a different direction,’ ” recalled Mr. Sheehan, who has since been hired as the chief integrity officer and executive deputy commissioner for the Human Resources Administration, which oversees Medicaid in New York City.

          A spokesman for the Cuomo administration would not specify the reasons for the decision, and Mr. Sheehan said that as a political appointee, he had no problem with it. But he disputed providers’ accusations, saying that the real issue was his challenge to a powerful industry that is a large employment engine.

          “Medicaid is to New York what corn is to Iowa,” he said. “It’s a heavy lift.”

          He said that audits of nursing homes, for example, found that some had inflated their profits by needlessly sending every patient to physical therapy during the month when annual reimbursement rates were calculated.

          The nursing-home trade group sought an injunction to stop the audits. A court dismissed the association’s argument that Mr. Sheehan had exceeded his jurisdiction.

          Mr. Herrick said that the decision was on appeal, and that his association was revising audit protocols with Mr. Cox, the new inspector general. “I have no personal knowledge that facilities followed the practice alleged,” he said, “and as a practical matter find it highly unlikely.”

          In home health care agencies, Mr. Sheehan said auditors found widespread patterns that violated Medicaid requirements linked to quality of care.

          “Nurses are supposed to review the work and design the plan of the home health aides, but there were cookie-cutter plans,” he said, citing one plan that failed to mention that the patient was an amputee or to explain how the aide was to care for the stump.

          “Home health aides would not show up, or would be in two places at once,” he added. “One entity billed us 500 times for home health care while patients were in the hospital.”

          Mr. Sheehan would not name audited agencies, but two of his former managers said the largest audit was of Visiting Nurse Service of New York, a $1 billion nonprofit group. That audit gained attention a year ago, when an internal report citing tens of millions of dollars in overpayments was leaked to The Wall Street Journal. At the time, the agency’s chief executive was on a task force advising the new governor on how to redesign Medicaid to trim costs.

          Richard Rothstein, a spokesman for Visiting Nurse Service, said that under an agreement with the inspector general’s office, he could not talk about the audit, which started in 2008 and has not been released. But he added, “There is absolutely no discussion about fraud,” only “errors in paperwork.”

          One example cited in the preliminary report was a bill for an eight-hour-long sponge bath. Mr. Rothstein said that there had been no intent to cheat Medicaid and that the aide who started the sponge bath had forgotten to report that a nursing crisis had intervened before she finished it hours later.

          Many providers welcomed Mr. Sheehan’s exit, but Richard J. Mollot, executive director of the Long Term Care Community Coalition, which advocates for nursing-home residents, did not.

          “It was politics at its worst to see him leave,” Mr. Mollot said. “They put enormous pressure on that office to sustain their budget, so to then turn around and say they were too aggressive is the height of hypocrisy.”

          After Mr. Sheehan’s dismissal, lawmakers unanimously passed a bill curbing the office’s authority. It cut the government’s time to reclaim overpayments to three years from six and let providers submit corrected bills rather than repay.

          Mr. Cuomo, an aggressive prosecutor of Medicaid fraud as attorney general, vetoed the bill. “The provider community, as a whole, plays a critical role,” his veto message said, “and many of their concerns reflected in this bill are legitimate.” But, he added, the bill “would potentially allow fraudulent and abusive activity to go undetected or unprosecuted.”

          Instead, he ordered Mr. Cox to review policies with “a working group comprised of representatives of provider associations and others.”

          Mr. Cox’s confirmation last week, after a nine-month wait, underscored the change in climate. At genial committee hearings, state senators said they were receiving positive feedback from providers, but one warned that the vetoed bill would be resubmitted “if we hear otherwise.”

          Mr. Introne, the deputy health secretary, said that Medicaid providers followed rules better now than they did five years ago. Mr. Sheehan agreed, and said his successor was well-qualified. But he noted that dozens of city audits he had asked to start or to release in his new job were still awaiting Mr. Cox’s approval.

          Audit figures released by the state show that Mr. Cox’s findings of overpayments have fallen steeply since Sept. 30, when the state met the deadline for the $1.5 billion federal target.

          Mr. Cox, a 23-year veteran of audits for the Health and Human Services inspector general, said he involved government lawyers and providers at the outset of an audit and examined every audit himself to make sure its findings could withstand a court challenge. That has held up some audits, he acknowledged, including that of Visiting Nurse Service, which is “still being reviewed and discussed with the entity and its lawyers to see what areas we agree on or disagree on.”

          “We’re all about fighting fraud,” he said, and “also about improving program integrity, quality of care, and saving taxpayer dollars. That’s our mission, and we’re sticking with it.”


          http://www.nytimes.com/2012/03/19/ny...ef=todayspaper

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