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THE LOBBYING GAME: INFLUENCE-BROKERS IN D.C.
HOW REPRESENTATIVES OF FOREIGN INTERESTS PUSH
THEIR AGENDAS AMONG WASHINGTON'S DECISION-MAKERS.
By Donald L. Barlett and James B. Steele, INQUIRER STAFF WRITERS
The Chinese may be having difficulty moving to a market economy, letting political prisoners out of jail, embracing Western-style ideas of democracy, and tolerating free expression.
But in one important area, China has made the transition from the old communist state to a sophisticated modern power in record time:
Influence-peddling in Washington.
Look no further than China's handling of its most important bread-and-butter trade issue - preservation of its preferential trading status with the United States. While the issue comes up every year, the 1994 fight was a watershed event in Washington power-brokering.
At stake were billions of dollars in trade benefits from the United States. The year before, a newly elected President Clinton had extended Most Favored Nation (MFN) trading status to China, but conditioned it on substantial human-rights progress by Beijing.
He gave the Chinese one year - until the spring of 1994 - to show improvement.
It soon became clear that Beijing intended to ignore the threat. As winter set in, it seemed Clinton would have little choice but to revoke MFN status.
And then the China lobby went to work.
What happened next was a textbook lesson in how lobbyists sway decision-makers in Washington - with severe consequences for American workers.
After corporate executives and Washington policymakers, no group has played so large a role in eliminating jobs in America as trade lobbyists.
These lobbyists are the people who in many cases help to shape federal policies on international trade. They represent U.S. multinational corporations, foreign-owned companies, foreign governments and other special interests.
Lobbying, to be sure, is hardly new to Washington. Efforts to influence American policy are as old as the republic.
What is different today is the extent of those efforts, the increase in the number of lobbyists, and the impact they are having on American workers.
As the number of trade lobbyists has gone up, the U.S. trade deficit has ballooned and the economic well-being of middle-class America has gone down.
Take the 10 biggest foreign exporters to the United States in 1995: Canada, China, France, Germany, Japan, Mexico, Singapore, South Korea, Taiwan and the United Kingdom.
In 1970, the United States had a trade surplus with five of them. There was no trade with China, the deficit with Taiwan was small ($22 million), and the only serious deficits were with Canada ($2 billion), Japan ($1.2 billion) and Germany ($386 million). That year, 157 foreign agents were registered to lobby the U.S. government on behalf of those 10 countries.
By 1995, the number had jumped to 554 - an increase of 253 percent. And the U.S. merchandise trade deficit with the 10 countries had shot up 7,950 percent - from $2 billion in 1970 to $161 billion in 1995.
To put that in perspective: If the minimum wage had risen at the same rate, a beginning hamburger flipper at McDonald's would earn $129 an hour - a quarter-million dollars a year.
But let's return to the real world, where there is a correlation between the successes of lobbyists for foreign producers and the falling standard of living of American workers.
As the trade deficit soared during those years, the average annual wage of workers in American manufacturing, calculated in 1995 dollars, fell from $27,230 in 1970 to $26,650 in 1995.
Even worse than the drop in wages was the job loss, as imported products replaced American-made goods in the marketplace and millions of factory jobs were snuffed out.
What has been bad for American workers has been very good for foreign producers and U.S. multinational companies. They have profited handsomely by convincing Washington policymakers to trim tariffs and ease other trade barriers on imported goods.
To gain access to the people who write the trade regulations, foreign interests buy the services of insiders who once did those jobs themselves: former government officials turned lobbyists.
JAPAN SETS THE COURSE
The Japanese, of course, wrote the book on lobbying in Washington a generation ago. When Japan began exporting to the United States in large quantities, Japanese corporations, trade associations and government agencies hired powerful Washington law firms and consultants to represent them.
Even today, Japan dominates the Justice Department's list of registered foreign agents. They range from large trade groups, such as the Japan Automobile Manufacturers Association and the Japan Iron and Steel Exporters Association, to huge corporations, such as Mitsubishi and Hitachi.
In 1991, the most recent year for which figures are available, the Japanese spent $83.9 million in consulting, public relations and legal fees for lobbying and related activities. That was up 577 percent from 1980, when Japan spent $12.4 million.
Today, what the Japanese perfected is being replicated by others.
Officially, the Department of Justice says 1,111 foreign principals - these are foreign governments, corporations, trade associations and others with foreign ties - have registered agents in the United States. No one knows precisely how many lobbyists actually work for them. The number ranges from as few as one to more than 50 lobbyists per foreign principal.
Which means that upward of 10,000 lobbyists are working the nation's capitol on behalf of foreign-owned corporations, foreign governments, and U.S. multinational corporations with a stake in foreign countries.
One of the extraordinary success stories of the lobbying game is China.
How did the Chinese achieve such a favorable trade position in so short a time? They began the same way Japan did - hiring lobbyists and channeling American decision-making.
But there was one big difference.
When the Japanese began exporting in volume, they had few allies here. The Chinese already have powerful corporate advocates in Washington.
General Motors and Ford, which fought imports of Japanese autos and auto parts for years, are among China's most ardent supporters. Like many American multinationals, they see China as both an expanding market for U.S. goods and as a potential manufacturing site - one where U.S. labor costs could be replaced by low-cost Chinese labor. Multinationals have operations around the world and export goods from those overseas facilities back to the United States.
So it's in their interest that Chinese-made goods be allowed entry with low tariffs. Indeed, because of low duties, imports from China have soared in the last decade, rising from $3.8 billion in 1985 to $45.5 billion in 1995.
Proponents of trade with China are fond of saying that China, with its 1.2 billion people, will need many goods as it develops, meaning an expanding market for American companies.
So far, though, the U.S.-China trade has been decidedly one-sided. The Chinese are selling to us, but buying much less in return.
Cheaper Chinese-made products may give consumers a price break. But the ongoing erosion of better-paying manufacturing jobs, aggravated by imports, is having a ripple effect, driving down wages and the standard of living of middle-class Americans.
To understand just how powerful the China lobby has become, let's go back to the 1994 campaign over Most Favored Nation status.
The coalition of Fortune 500 companies that teamed up with agents of the People's Republic of China to preserve MFN was as influential a lobby as Washington ever sees.
In addition to the efforts of individual multinationals, such as AT&T, Motorola, General Electric, TRW Inc., Honeywell, Chrysler, Digital Equipment, Kodak and Boeing, powerful business consortiums raised large sums of money to underwrite the lobbying assault.
Typical of the amounts raised: The United States-China Business Council, made up largely of some of America's biggest multinational corporations, took in $1.4 million in 1994 alone.
Another pro-China business lobby, the Emergency Committee for American Trade, built a war chest from cash contributions by some of America's most highly compensated executives. Tapping corporate chieftains for personal donations of $11,000 on average, the Emergency Committee raised $612,500 in 1994. Donors included:
- John J. Murphy, chairman and CEO, Dresser Industries, whose 1994 salary and bonus totaled $1.7 million.
- Duane L. Burnham, chairman and CEO, Abbott Laboratories, 1994 salary and bonus, $1.6 million.
- Leslie H. Wexner, chairman of the board and CEO, The Limited, 1994 salary and bonus of $2 million.
- David W. Johnson, president and CEO, Campbell Soup Co., 1994 salary and bonus, $1.8 million.
- Edwin L. Artzt, chairman of the board and CEO of Procter & Gamble, 1994 salary and bonus, $3.2 million.
Beginning in the winter of 1993-1994, lobbyists swarmed over Washington. They conducted briefing sessions at the Capitol. They brought corporate executives to Capitol Hill to personally lobby lawmakers about the stakes. And they distributed studies that purported to show the high cost to the American economy of revoking MFN status.
At a House Ways and Means subcommittee hearing on Feb. 24, 1994, one corporate speaker after another warned of the "devastating" consequences if MFN were revoked.
Fermin Cuza, a vice-president of Mattel Inc., the toymaker, said higher import duties would have a "severe impact" on American importers, some of whom "would be quickly forced out of business." Higher tariffs, he added, would "raise retail prices by approximately 25 percent, at a minimum, [and] also put at risk many of the 32,000 U.S. jobs in the U.S. toy industry."
Alongside the U.S. multinationals, the People's Republic fielded its own impressive team.
The Washington office of Cleveland's Jones, Day, Reavis & Pogue, the nation's third-largest law firm, represented the Embassy of the People's Republic. The Washington office of Mudge Rose Guthrie Alexander & Ferdon, the New York law firm of former President Richard M. Nixon, represented the China National Import/Export Corp.
Confronted by this powerful lobby, President Clinton backed away from his ultimatum.
On May 26, 1994, the President announced: "I have decided that the United States should renew Most Favored Nation trading status toward China."
While acknowledging "continuing human rights abuses," the President said that trade benefits represented the "best opportunity" to solve the human rights questions and advance the U.S.'s "other interests with China."
Bejing not only had triumphed; it got more than it had bargained for.
In extending MFN, Clinton said that, in the future, renewing China's trade status would not be contingent on progress on human rights.
With that major stumbling block out of the way, it has been renewed ever since.
Oh, there are occasional rumblings from Congress about how Beijing must clean up its act. But little comes of such threats.
The truth is, for all the sound and fury coming out of Washington, China's trade privileges have never been at risk. Not in 1996. Not in 1995. Not in any year before that.
What are the consequences of all those China lobby victories?
- Between 1986 and 1995, the U.S. trade deficit with China exploded from $1.6 billion to $33.8 billion - a 2,019 percent increase.
- The imports that caused those deficits eliminated an estimated 680,000 American jobs, based on the estimate that at least 20,000 jobs are lost for every $1 billion in imports. Picture two states, Vermont and North Dakota; now picture every working man and woman in those states - 630,000 - suddenly unemployed. Cancel all their wages, more than $11 billion a year, and taxes paid on that income. Forever.
- Chinese shipments to the United States are not primarily raw materials, but finished goods. At the top of the list of products sold to the United States in 1995: radios, television sets, records and related items, $2.8 billion; games, toys and children's vehicles, $2.7 billion; rubber and plastic shoes, boots and sandals, $2.2 billion. These products used to be made in America by American workers.
- The Chinese export an even greater volume of certain high-tech products to us than we sell to them. In 1995, $1 billion worth of computers were exported to the United States from China. U.S. companies exported a mere $267 million in computers to China.
- While Washington talks about high-paying jobs created by high-tech goods, our exports to China resemble those of a Third World country. Of the top 20 products exported in 1995, ranked by their value, four were agricultural: cotton, ranked No. 3, at $829 million; corn, No. 4, at $629 million; wheat, No. 5, at $506 million, and soybean oil, No. 7, at $299 million. They accounted for 30 percent of the top 20. Or one-fifth of all exports to China. The only sizable export of a manufactured product: aircraft worth $891 million.
- The United States exported only one commodity to China with a value exceeding $1 billion: phosphatic fertilizers. Among the few U.S. businesses benefiting from this trade is a Tampa, Fla.-based company called U.S. Chem Resources. Formerly known as U.S. Agri-Chemicals Corp., the company has, since 1989, been a subsidiary of a global corporation called Sinochem International Petroleum Co. With annual sales of more than $122 billion, Sinochem is in the same league as Exxon Corp.
And where is Sinochem headquartered?
Beijing, China.
In short, one of the largest U.S. exporters to China is a Chinese-owned company.
BUYING KNOW-HOW AND ACCESS
For most foreign interests, the way to succeed in Washington is to look to the revolving door - to people who have rotated out of the executive branch or Congress into the lobbying or consulting game.
Someone like William H. Houston 3d.
Houston was the chief textile negotiator for the U.S. Trade Representative's office in 1987. He negotiated agreements with foreign nations that set limits on the volume of apparel they could export to the United States.
The next year, Houston became a private consultant, and afterward helped offshore clients negotiate agreements with the U.S. government on the volume of apparel they could export to the United States.
The company he works for, Sandler & Travis Trade Advisory Services, secured a $25,000-a-month contract from an exporters group in the Dominican Republic to represent them in 1993 negotiations with the United States on a new textile agreement, stressing the "extensive experience" of the firm's members, including Houston, in international textile negotiations.
The agreement was renegotiated, and the Dominican Republic's quota of apparel imports to the United States was increased.
There are thousands of people like William Houston 3d in Washington, using their government-gained know-how for private clients.
Brenda Jacobs was a lawyer for the International Trade Commission in the 1980s, then moved to the Commerce Department's Committee for the Implementation of Textile Agreements. In 1989, she entered private practice.
In 1990, she registered to lobby Congress for the Toy Manufacturers of America on behalf of retaining China's Most Favored Nation status. The lobbying campaign succeeded, and since then toymakers have closed plants in the United States and shifted more production to China.
According to the Toy Manufacturers of America, at least 75 percent of the toys sold in the United States are made wholly, or in part, overseas.
Check the resume of many Washington trade lobbyists and you likely will find that they served an apprenticeship with one or more government agencies - the Office of the United States Trade Representative, the International Trade Administration, the Export-Import Bank, the Antitrust Division of the Justice Department, the National Security Council, State Department, White House or Congress, to name only a few.
Foreign interests recruit these government alumni not only for their experience in Washington, but for their contacts in Congress or the bureaucracy. And they pay handsomely for that access.
Early in 1994, the Embassy of India, eager to improve relations on Capitol Hill, retained the Washington law firm of Raffaelli, Spees, Springer & Smith to arrange a series of meetings for the Indian ambassador, Siddartha Shankar Ray, with members of Congress. The purpose, according to an embassy spokesman, was to discuss matters of mutual interest, including "trade and foreign policy."
The lead partner, John Raffaelli, was an aide to Sen. Lloyd M. Bentsen from 1980 to 1984, when the Texas Democrat was a power on the Senate Finance Committee, which oversees tax and trade legislation.
For the Indian Embassy, Raffaelli, Spees arranged 141 meetings with lawmakers or their staffs, including face-to-face meetings with 69 members of Congress and senators during a six-month period.
The firm is on a retainer from the Indian government, according to reports on file with the Clerk of the House. The fee: $57,500 a month, or $690,000 a year.
When asked why a lobbyist had been hired, the embassy spokesman said: "This is the way things are done in Washington. . . . The feeling was, everybody is doing it, there is a case to be made for it, and let's use some professional help to gain a better knowledge of legislative procedures."
The files of the Justice Department's Foreign Agents Registration Office bulge with details about how foreign agents earn their retainers. It's not a bad life. They lunch at stylish Washington restaurants, attend meetings with members of Congress and senators, and travel to foreign countries.
Take Ruth M. Kurtz, who represents a consortium of Mexican businesses.
As with most Washington lobbyists, Kurtz received her early training courtesy of U.S. taxpayers. She worked at the Department of Commerce from 1970 to 1980 as an economist and trade negotiator. Then she was a trade adviser at the International Trade Commission, put in five years on Capitol Hill as a trade specialist for Sen. William V. Roth, Republican from Delaware, and helped draft the Omnibus Trade and Competitiveness Act of 1988, one of the most comprehensive trade bills in recent years.
In 1989, she left government and became a private consultant. She works for COECE, an organization of influential Mexican business groups that was formed to lobby for congressional approval of the North American Free Trade Agreement (NAFTA).
COECE has pumped thousands of dollars into lobbying - most of it on behalf of NAFTA, which lowered tariffs among the United States, Mexico and Canada.
Kurtz's reports filed with the Department of Justice provide a window on the Washington world of power-lunching and how lobbyists seek to influence U.S. policy:
August 13, 1992: "Alice Block, USTR [Trade Representative's office], Discussion re NAFTA."
August 14, 1992: "Rebecca Bannister, U.S. Department of Commerce meeting re NAFTA."
May 24-27, 1992: "Organized and participated in fact-finding trip to Mexico for congressional staff."
May 10, 1993: "La Colline. Lunch meeting with Thelma Askey [House Ways and Means Committee] re NAFTA."
May 25, 1993: "Le Mistral. Lunch mtng. with Diane Sullivan [tax and trade counsel for Rep. Robert Matsui, a Democratic congressman from California] re NAFTA."
June 8, 1993: "Cafe Berlin. Lunch mtng. with Mary Foley [legislative assistant, Sen. Max Baucus, a Democratic senator from Montana] re NAFTA."
August 9, 1993: "La Brasserie. Lunch mtng. with Meredith Broadbent [minority professional assistant, House Ways and Means Committee]."
Nov. 18, 1993: "La Belle Florist. Gift to Tana Rosenblatt. Legislative assistant, Office of Cong. [Jim] Kolbe" (R., Ariz).
Nov. 20, 1993: "Everlasting Harvest Herb and Dried Flower Farm. Five Gifts. Four for Sen. Roth staff. One for Cong. Matsui staff."
April 22, 1994: "Sfuzzi. Lunch with Jim Jones, legislative assistant, Office of Sen. [Patty] Murray" (D., Wash.).
June 7, 1994: "Le Mistral. Lunch with Brian Bieron, legislative assistant, Office of Cong. [David] Dreier" (R., Calif.).
The COECE campaign, of course, was but one of many lobbying offensives by Mexican commercial interests and U.S. multinationals to swing votes in Congress for NAFTA.
The trade agreement with Mexico and Canada was ultimately adopted by Congress in November 1993. Kurtz continues to represent COECE in Washington at a salary of $120,000 a year.
Oh, yes. Congressmen Kolbe, Matsui and Dreier and Senators Baucus, Murray and Roth all voted in favor of NAFTA.
THE FRUIT OF THE LOOM AMENDMENT
What difference does it make if former government officials go to work for private interests?
A lot. Meet Doral Cooper and Ronald Holley, two people from very different worlds.
She lives in Washington and is a former trade official in the Reagan administration who used that experience to become a high-powered lobbyist.
He lives in Batesville, Miss., a community of 6,400 in the northwest corner of the nation's poorest state, where he grew up, graduated from high school and went to work cutting cloth for the area's largest employer.
In 1994, the worlds of Cooper and Holley collided.
At the time, she represented an alliance of big-name retailers who wanted to block efforts by a few members of Congress to limit certain kinds of cheap imports.
He wasn't represented by anybody.
In the end, Cooper didn't get everything her clients wanted. But Holley lost everything.
His employer of 20 years, Fruit of the Loom, closed its Batesville plant, laid off all 850 workers, and moved production offshore.
At the time, Holley earned $10.25 an hour, a little more than $21,000 a year.
On this point, Holley poses a question that's on the minds of many working Americans: "How can someone who makes $10.25 an hour compete with somebody making 30 cents an hour? We can't live on that. How can you call that equal?"
The battle that Doral Cooper fought on Capitol Hill revolved around an obscure trade provision.
For years, American retailers have imported apparel that is labeled "Made in Hong Kong" but which actually is sewn in mainland China. The practice grew out of U.S. customs regulations that restricted the volume of apparel that could be imported from any one nation. When mainland China reached the maximum, American importers and Hong Kong businessmen found a way to circumvent the limit.
By having the fabric cut in Hong Kong, then shipped to mainland China for sewing and assembly - the bulk of the work - and sent back to Hong Kong for export, a garment could have a Hong Kong label and come in under Hong Kong's unused quotas, even though it was largely made in China. It was all perfectly legal.
This worked fine for retailers such as The Gap, The Limited, J.C. Penney and Wal-Mart, which were always pressuring suppliers for the lowest prices. But it wasn't good for domestic producers such as Fruit of the Loom, whose production workers typically earned $7-to-$10 an hour, competing with 30-cent-an-hour Chinese seamstresses.
In the summer of 1994, Fruit of the Loom and other U.S. producers asked Congress to end the practice that allowed goods made in one country to come in under the quota limits of another.
Retailers, importers and foreign producers weren't about to sit still for that.
The fight over the "Fruit of the Loom Amendment," as it became known, swirled around the Senate Finance Committee, which had to OK the provision before it could go to the full Senate.
Among those lobbying the committee that summer, Doral Cooper was to play a pivotal role.
An assistant trade representative for Asia, Africa and the Pacific during President Reagan's first term, Cooper had left the office in 1985 to become a trade consultant.
She eventually joined C&M International, a consulting company affiliated with the Washington law firm of Crowell & Moring, and built up a successful trade practice. Her foreign clients included the Korea Foreign Trade Association, the Board of Foreign Trade on Taiwan and the Indonesian Ministry of Trade.
It was her role as a lobbyist for The Limited, a major importer of men's and women's wear under such well-known brand names as Victoria's Secret, Structure and Abercrombie & Fitch, that brought her into the Fruit of the Loom fight.
The strategy of Cooper and her allies was simple: Swamp the Senate Finance Committee members with calls, letters and personal visits from corporate leaders warning that clothing prices would shoot up, hurting American consumers and the retail industry, if the committee members approved the amendment.
Of the full-scale campaign, Cooper later told the Legal Times: "This was a must-win for us."
The upshot: On Aug. 2, 1994, the Finance Committee deadlocked, thus killing the Fruit of the Loom measure.
Afterward, Fruit of the Loom officials went back to lawmakers again. That time the company prevailed, and late in 1994 secured language in trade law similar to what had been rejected earlier.
But retailers and foreign interests succeeded in modifying the new law to cushion the impact. Rather than taking effect on Jan. 1, 1995, as the original Fruit of the Loom proposal had called for, the law did not take effect until 18 months later: July 1, 1996.
That was too late for Ronald Holley and his co-workers.
In May 1995, Chairman William Farley said the company was committed to a "gradual migration" of its sewing facilities to the Caribbean and Central America.
The company was moving production offshore aggressively. From producing 30 million dozen garments offshore in 1995, the company said it would produce 50 million dozen in 1996, and 70 million dozen offshore by 1998.
Six months later, on Oct. 30, 1995, the company announced it was eliminating the jobs of 3,200 of its U.S. employees because of the "difficult retail environment for apparel and increasingly competitive nature of the business."
Fruit of the Loom closed six U.S. plants - in Batesville; Florence, Ala.; Franklin, Ky.; Acadia Parish, La.; and Albemarle and Kings Mountain, N.C. - and scaled back employment at two others.
All told, the company cut back its domestic workforce by 12 percent.
In Batesville, Ronald Holley, who had cut cloth that seamstresses sewed into men's briefs and undershirts, was out of a job for five weeks. He found work as a shipping clerk for a local furniture maker, at 30 percent less pay. Even so, he considers himself lucky.
"Every time I go to the grocery store with my wife, I run into somebody I worked with for years," he said. "The ones I've been running into lately have not found work."
As it turned out, the impact of the Fruit of the Loom shutdown in Batesville went far beyond the 850 people who lost their jobs. Batesville learned what cities and towns all over America have been finding out:
When a large employer, especially a manufacturing plant, closes, it has a ripple effect, spreading outward to those who supplied goods and services to the company and its employees.
When the mill closed, a local vending company that furnished snacks to the plant lost its largest account. The company had to lay off several longtime employees. One of them was Holley's wife, Vickie. She still has not found work.
For many Fruit of the Loom employees, Holley said, jobs have been scarce and many are about to exhaust their unemployment benefits. "I don't think this town has seen the full effect of this yet," he said.
Holley can't understand why policymakers, through free-trade agreements, are sacrificing the nation's manufacturing base.
"What are the young people going to do? When I was 19 I got a job at this plant," he said. "Where are the new jobs going to be? We can't all be lawyers or computer experts. And some choose not to go that way anyway. So what will people do?
"What it looks like to me is that our government or our Congress - whoever it is - is taking some of the jobs away that they seem to think are not important."
Americans employed in manufacturing now represent 15.8 percent of all jobs. In 1960, the percentage was 26.1.
None of the United States' leading trading partners has experienced anything approaching this loss in manufacturing jobs. Indeed, some have actually increased the percentage.
Germany had 34.4 percent of its workforce employed in manufacturing in 1960; 33 years later, in 1993, the number had declined slightly, to 29.1 percent. In Italy, the percentage has remained virtually unchanged - 24 percent in 1960 versus 23.2 percent in 1993. In Japan, the share of the workforce employed in manufacturing went up, growing from 21.7 in 1960 to 23.9 percent in 1993.
GRAD SCHOOL FOR LOBBYISTS
Doral Cooper came out of what has become Washington's premier graduate school for trade lobbyists - the Office of the United States Trade Representative.
It is the nation's most important agency dealing with trade. It coordinates and directs trade policy and is supposed to be a watchdog for business, negotiating with other governments when a U.S. industry is jeopardized by international trade practices or when American exports are blocked by foreign trade barriers.
Anyone in that office for even a short time learns how Washington operates and gains insights into the workings of many domestic industries and their foreign competitors - invaluable information for a later career as a lobbyist or consultant.
The files of registered foreign agents kept by the U.S. government are full of alumni from the Trade Representative's office.
Alexander Platt was associate general counsel of the office from 1983 to 1985. He then became a partner with the Washington law firm of Akin, Gump, Strauss, Hauer & Feld, whose clients included the Japanese External Trade Organization, Colombia Flower Council, Fujitsu America Inc., Matsushita Electric Industrial Co. Ltd., Mazda Motor Corp., and COECE, the Mexican business consortium.
Jeanne S. Archibald was associate general counsel of the Trade Representative's office from 1980 to 1986 and worked at the Treasury Department from 1986 to 1993, rising to the position of general counsel. Then she became a partner with Hogan & Hartson, a Washington law firm whose foreign clients included the Embassy of Japan, the China External Trade Development Council, Nippon Telegraph & Telephone Corp., and the Korean Foreign Trade Association.
Lest you think the revolving door only turns out from the Trade Representative's office, then consider the case of the nation's top trade negotiator - Charlene Barshefsky.
As acting trade representative, Barshefsky is, next to the President, the most powerful person in government on trade matters. Her job is to represent America's interests in global trade.
But for most of her career, Barshefsky has been on the other side - representing foreign interests.
Before she entered government in 1993, Barshefsky was a partner at the Washington law firm of Steptoe & Johnson, where she specialized in international trade law and co-chaired the firm's 35-lawyer International Practice Group.
On Jan. 8, 1992, for example, she filed a registration form with the Department of Justice - as required of lobbyists under the Foreign Agents Registration Act - in which she described her work as providing "legal advice and representation and trade counseling to clients in the firm."
The Steptoe foreign principals listed on Barshefsky's form were "COECE [the consortium of Mexican business groups], Hercules General Cement Co., Embassy of Canada, Turkish Republic of North Cyprus, Canadian Sugar Institute, Nippon Steel Corp., Canadian Forest Industries Council, Canadian Wheat Board."
She would later tell senators during her confirmation hearing that she did no "lobbying of any kind," but had simply registered as a precaution. "There are many gray areas under the act," she testified.
Nevertheless, the fact remains: Barshefsky, before becoming the nation's highest trade official, was indeed registered to represent foreign interests.
REVOLVING DOOR KEEPS SPINNING
Occasionally, a president or Congress purports to strike a blow at lobbying by onetime government officials. But these efforts invariably fall short.
In 1978, Congress enacted the Ethics in Government Act, which banned high officials in the Executive Branch from lobbying their former agencies for a year after leaving office.
In 1989, Congress enacted new restrictions on lobbying by former executive branch officials and, for the first time, placed limits on lobbying by former members of Congress and key staffers.
After President Clinton took office in 1993, he signed an executive order extending the ban on top Executive Branch officials to five years, and prohibited such officials from ever representing foreign governments or foreign political parties. In December 1995, Congress codified Clinton's lifetime ban on lobbying by top trade negotiators on behalf of foreign interests.
But these measures, as ambitious as they might sound, have not gone very far. None bars former legislative aides from lobbying the Executive Branch. Senior staff members of the House Ways and Means Committee and Senate Finance Committee, which oversee trade legislation, are free to start lobbying the Commerce Department or the Trade Representative's office the day they leave the government payroll.
Nor do the restrictions affect the vast bulk of the federal trade bureaucracy, such as assistant trade representatives. They, too, are free to lobby on trade-related matters after they leave government.
When Clinton campaigned in 1992, he singled out Washington lobbyists and influence-peddlers for special scorn and vowed that his administration would be different. And after his executive order concerning lobbying by top Executive Branch officials, Mickey Kantor, then Clinton's trade representative, told reporters:
"I think we've locked the revolving door."
Really? Take a look at the Trade Representative's office under Clinton.
In addition to Barshefsky, there are other appointments worth noting.
The office's senior counselor and negotiator, Ira S. Shapiro, was a partner specializing in international trade for the Washington office of Winthrop, Stimson, Putnam & Roberts. Jeffrey M. Lang, the new deputy trade representative, came out of the same law firm, where he, too, specialized in international trade.
Both previously worked on Capitol Hill, Shapiro as a staff member of the Senate Governmental Affairs Committee and Lang as chief international trade counsel for the Senate Finance Committee. Today, after stints in the private sector, they are back in government.
But Winthrop, Stimson, Putnam & Roberts doesn't have to worry about losing too many lawyers to government service. The revolving door continues to turn.
After Shapiro and Lang left to join the Trade Representative's staff, an assistant trade representative, C. Christopher Parlin, resigned late in 1995 and headed to - you guessed it - Winthrop, Stimson.
On Feb. 14, 1996, Winthrop, Stimson filed papers with the Clerk of the House of Representatives reporting the name and title of each employee "who has acted or is expected to act as a lobbyist" for the firm's clients.
Parlin was listed as a lobbyist for two influential foreign groups: the Korea Semiconductor Industry Association and Korea Automobile Manufacturers Association.
Which means that nothing much really has changed since June 21, 1992, when candidate Bill Clinton had this to say in a position paper on the revolving door:
"It's long past time to clean up Washington. The last twelve years were nothing less than an extended hunting season for high-priced lobbyists and Washington influence peddlers. On streets where statesmen once strolled, a never-ending stream of money now changes hands - tying the hands of those elected to lead. . . . This betrayal of democracy must stop."
Research help was provided by Bill Allison. Also contributing to the research were John Brumfield, Harold Brubaker and Tirdad Derakhshani, as well as Inquirer library staffers Denise Boal, Frank Donahue, Joe Daley, Alletta Bowers, Sandra Simmons and Ed Voves.
Copyright 1996 PHILADELPHIA NEWSPAPERS INC.
May not be reprinted without permission.
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