Photograph of Stock Exchange by Spencer Platt/Getty Images.
Janet Yellen is not. Washington’s legal community is. Some say that his recent slide into a job at the private-equity firm Warburg Pincus proves Timothy Geithner always was.
What’s the charge? With the Volcker Rule—which purports to make banks’ trading less risky—gaining final approval just before the new year and Yellen’s confirmation as Federal Reserve chair just after, the phrase “captured by Wall Street” has gained a currency it hasn’t had since the days of the Troubled Asset Relief Program. Dividing the captured from the rest has become the new parlor game for pundits.
What makes it an interesting pastime is that the once-natural categories of pro-market Republicans and pro-regulation Democrats no longer apply. Last year, when Columbia law professor John Coffee quit a task force on financial regulation at the Bipartisan Policy Center, he explained in a parting shot how Wall Street’s influence was changing our politics. Although the major parties were equally represented on the panel, Coffee told the Washington Post in August, “it was not bipartisan in terms of the critical division in Washington: the financial services party and the reform party.”
Coffee’s insight echoes a similar one about how campaign finance is deforming our usual notions of partisanship. “ ‘Republican’ doesn’t mean anything. ‘Democrat’ doesn’t mean anything,” a candidate vanquished by undisclosed corporate cash in Michigan told NPR in November. “It’s the huge money and everybody else.”
The constant press for contributions is a true bipartisan effort. “When it comes to fundraising, they all understand each other,” says Viveca Novak of the Center for Responsive Politics.
But Wall Street’s capture of the capital is more complex. Washington lawyers are hired less for their advice than for doing their clients’ bidding. On the Hill, many would-be reformers have one eye on the revolving door. “Most Senate Banking Committee staffers are in their early thirties,” says former Joe Biden aide Jeff Connaughton, author of The Payoff: Why Wall Street Always Wins. “I can’t tell them, ‘Don’t worry about making money.’ ”
More than that, the big bankers constitute a powerful club. “There’s a social glue,” says Connaughton. “If you play ball with establishment forces, you’ll do well.”
Then there’s the simple fear of wrecking the economy. Even if last-minute changes put teeth into the Volcker Rule, some veteran observers still take the overall timidity of the Dodd-Frank reforms as a sign that Wall Street’s warnings against meddling with the market have paralyzed lawmakers. “So much more could have been asked for by someone with a vision of where to go,” says Donald Langevoort, a securities expert at Georgetown Law.
No one expects a formal realignment of the parties—paralysis only heightens the partisan rancor. But when serious legislating gets done—as when the establishment circled its wagons to pass December’s budget deal, with the House speaker blasting away to his right—expect it to come not by traditional bipartisanism but by a coalition of the captured, or the not.
This article appears in the February 2014 issue of Washingtonian.
If Congressman Peter King gets his way, Hollywood filmmakers will have a harder time making movies about events that relate to national security. He’s asked the Pentagon and the CIA to come up with a stricter method of dealing with the entertainment industry.
What prompted the New York Republican’s concern is a film in production by Oscar-winning director Kathryn Bigelow about the killing of Osama bin Laden. King says he heard the Obama administration was giving Bigelow access to sensitive information about the raid, leading him to demand an investigation by the Department of Defense and the CIA.
King says the preliminary investigation must have found something relevant, because the DOD inspector general decided to move forward with a formal investigation, which, according to King, is underway now. Neither Bigelow nor her screenwriting partner, Mark Boal, has commented publicly, but it’s well known that they were working on the bin Laden film even before the Al Qaeda leader was killed by a team of Navy SEALs in May 2011.
Minnesota representative and presidential candidate Michele Bachmann at the Ames, Iowa, Straw Poll. Photograph by Gage Skidmore
Republican presidential candidate Michele Bachmann touts her experience as a federal tax lawyer with the IRS, a job she says gave her the insights she needs to simplify the US tax code. But Bachmann is curiously silent about another part of her legal career—perhaps because it didn’t amount to much.
In the mid-’90s, five years before she entered a career in politics, Bachmann hung out a shingle as a legal mediator, a specialist who helps parties settle conflicts out of court. The company, Michele Bachmann Mediation LLC, “was formed to offer a service to people seeking mediation tax services,” said Bachmann’s congressional spokesperson, Becky Rogness. But it’s unclear what clients—if any—Bachmann had.
Bachmann took all the steps one would expect from an aspiring small-business owner. She incorporated the company with the state of Minnesota, listing her then-home address in Stillwater. She took a series of state-sanctioned courses in order to have her name placed on a state roster of qualified mediators. Bachmann even advertised—in 1995, she adopted a stretch of highway in her company’s name, which was printed on a road sign.
But four other mediators in Stillwater said they never saw Bachmann in professional circles or heard of her taking clients. Most were surprised to learn she’d had a mediation business at all. There is no official account of any work Bachmann may have done—mediation proceedings are confidential and Minnesota doesn’t keep records of them, a state official said. Bachmann also didn’t disclose any income from the business on her financial disclosure forms after she was elected to the state senate in 2000.
Kurt Bardella, left, with Republican California Representative Darrell Issa. Photograph courtesy Kurt Bardella
Just six months after being tossed from Capitol Hill in disgrace, controversial GOP press operative Kurt Bardella has been rehired by the very congressional committee that fired him.
The news that the House Commmittee on Oversight and Government Reform rehired Bardella was first reported by FishbowlDC’s Betsy Rothstein early Wednesday morning.
Photograph by Scott Gries (PictureGroup)
In our July issue—on stands now—we told you about Washington lawyer Trevor Potter, who has been shepherding Comedy Central star Stephen Colbert through the process of forming a super PAC. Check out our piece below on how Potter, a longtime counsel to clients such as Sen. John McCain, became Colbert’s lawyer.
Potter has earned those legal fees. As of Thursday, he, along with the help of Matthew Sanderson, an associate at his law firm, achieved success when the Federal Election Commission approved Colbert’s Super PAC. For the second time, Colbert visited the FEC, bringing throngs of screaming fans and reporters to the typically quiet agency.
During remarks to the crowd, Colbert thanked his legal team: “We owe a debt to my lawyers Trevor Potter and Matt Sanderson of the heroic law firm Caplin & Drysdale. Two names that will go down with the great American duos—Lewis and Clark, Sacco and Vanzetti, Harold and Kumar.”
It’s a safe bet that two DC lawyers have never before been compared to Harold and Kumar.
-----
What do Republican senator John McCain and Comedy Central’s faux pundit Stephen Colbert have in common? Their lawyer, Trevor Potter.
Fans of The Colbert Report have seen Potter—head of Caplin & Drysdale’s political-law practice and a lawyer in its Washington office—make four appearances on the show as he counsels Colbert on how to set up his super PAC, a new type of political-fundraising apparatus that can raise and spend unlimited amounts of money.
Though the legal work is playing out before a TV audience and, in usual Colbert fashion, is meant to highlight the absurdities of campaign-finance rules, it’s not just entertainment. Colbert is a real client; Potter says he got the legal work the same way lawyers get much of their work—by referral. When Colbert decided to tackle federal-election-law issues, the show asked a New York attorney and former guest for recommendations. The attorney suggested Potter.
Every summer thousands of interns arrive on Capitol Hill. For those bright-eyed and ambitious college students and recent graduates hoping to live out their West Wing fantasies, FamousDC bloggers Josh Shultz and Amos Snead created this career chart laying out what the future holds.
Click the image to view the chart at full size.
This article appears in the June 2011 issue of The Washingtonian.
Subscribe to Washingtonian
Follow Washingtonian on Twitter
More>> Capital Comment Blog | News & Politics | Party Photos
First, the conservative superlawyer became an unlikely gay-rights advocate when he agreed to represent couples challenging California’s same-sex marriage ban. Now the man who won George W. Bush the presidency is a Barack Obama appointee.
The girls were trying to control nervous giggles—no small task with DC mayor Adrian Fenty greeting them onstage and 150 child-welfare advocates, a US senator, and BET in the audience. But when Stacie Scott Turner announced that Dell was giving laptops to the youngsters—they’re girls in DC foster care whom she’s taking to South Africa for a service, education, and World Cup-watching trip as part of her Extra-Ordinary Life charity—their composure vanished into a flood of hugs and exclamations. Oprah never had a more appreciative audience for a giveaway. And Turner proved that there’s at least one Real Housewife of DC who can create a spectacle and draw a crowd of influential Washingtonians without crashing a party.
“We consider you our family,” she told the crowd, praising DC Child and Family Services Agency staffers and family-court judges, many of whom were in the audience. Turner herself was born into the city’s foster-care system and adopted as a child. “Family isn’t just the people who had you,” she said. “It’s the people who care about you.”
It appears there’s not one piece of news these days that our leaders can agree on. Job numbers are up . . . but so is unemployment. Elena Kagan is a fountain of wisdom . . . and an empty, inexperienced judicial vessel. Any minute now Rush Limbaugh will be lambasting about how the disastrous Gulf Coast oil spill is as natural as ocean water . . . Oh, yeah.
In other news, bless Mary Fallin and her Oklahoma jokes. And double bless Leonard Boswell for wearing wooden shoes at a tulip festival, which is really something people should do more often. Does Lisa Murkowski really need to win a gun? Don’t they give them away free in Alaska along with the annual $1,000 tax credits you get just for living in a giant national park? Kirsten Gillibrand is hanging out with Rachael Ray, Bob Inglis wants the US to be more like Southwest Airlines (does that include charging overweight people double?), Jason Chaffetz is Team Coco, and Mike Pence now officially speaks for the American people. All of them.
Perks come with being a member of Congress—among them, a million-dollar office budget for each member. As part of Speaker Nancy Pelosi’s push for transparency, the House for the first time has published its spending online—data that was then made searchable by the Sunlight Foundation. It’s now easy to know how Congress is spending the nearly $5 billion it allocates itself annually. The Senate is expected to follow suit next year. Here are the top congressional budgets for staff salaries for the second half of 2009, not counting additional staff working for various committees:
