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The Corporate Cabinet: Secretary of Agriculture Sonny Perdue

Corporate Connection: Big Agriculture

George Earvin “Sonny” Perdue, the secretary of agriculture, was governor of Georgia from 2003 to 2011, after a career as a farmer, veterinarian, agribusinessman and state legislator. Before taking office, he held ositions at eight different companies, including Perdue Partners, an export consulting company that Perdue founded along with his first cousin David Perdue, now a U.S. senator. Perdue’s time as governor was marked by many ethics controversies involving his private businesses.

  • Over the course of his career, Perdue has collected donations totaling over $950,000 from the agricultural sector.
  • Perdue collected at least $25,000 worth of gifts, including ones from tobacco company Altria and railroad company CSX, despite an executive order signed by Perdue requiring state employees to work for the benefit of the public rather than for financial or personal benefit.
  • Perdue had a net worth of $6 million and his businesses were worth $2.8 million in 2006 when he ran for governor of Georgia.
  • When elected governor, Perdue refused to put his businesses in a blind trust.
  • As governor, Perdue met with state employees in the Georgia Ports Authority in Savannah to discuss the growth of Perdue’s private business. Perdue’s spokesman said that the governor was merely obtaining information that was available to any business, but state ethics law says a government official cannot engage in business with the government.
  • In 2005, the Georgia Government Transparency and Campaign Finance Commission, then called the State Ethics Commission, fined Perdue after he used an airplane owned by his family business for campaign purposes and failed to report it.

After becoming secretary of agriculture, Perdue has filled the office with staff members who have ties to agribusiness and taken actions that support agribusiness and harm small farmers. They include:

  • Kailee Tkacz, an advisor to Perdue and other U.S. Department of Agriculture (USDA) officials, is a former lobbyist for the Corn Refiners Association, a trade group that consists of the four biggest corn syrup producers in the United States.
  • Rebeckah Adcock, who leads the deregulation team at the USDA, is a former pesticide industry lobbyist. While in office, she met with her former employer, CropLife America, the pesticide industry’s trade group.
  • Under Perdue, the USDA has rolled back regulations on school lunches, exempting some processed foods from meeting whole grain standards, delaying a low-sodium limit and allowing schools to serve low-fat flavored milk. These new measures are less healthy for school children but more beneficial for the processed food industry.
  • Perdue proposed the “America’s Harvest Box” of prepackaged food to reduce the cost and number of people on food stamps. The program would make it harder for recipients to obtain fresh food and would hurt food suppliers economically.

 

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Petty Corruption at Large: The Many Scandals of Scott Pruitt

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“You are unfit to hold public office and undeserving of the public trust,” Representative Frank Pallone Jr. of New Jersey told Scott Pruitt, the current Environmental Protection Agency chief, when Pruitt testified before the House Energy and Commerce Committee on April 25th of this year.

Pruitt is indeed unfit. If his business ties to the energy and coal companies that the EPA is intended to regulate didn’t disqualify him heading the agency in the first place, then his use of taxpayer dollars to fund his own lavish lifestyle certainly does.

Pruitt currently faces 13 federal inquiries into his spending and management practices as EPA chief. Here is a summary of current investigations into his spending:

Two investigations pending for a steeply discounted $50 a night condo rented from an energy lobbyist

Last year, Pruitt paid $50 a night to live in a Capitol Hill condo co-owned by the wife of J. Steven Hart, a lobbyist for the fossil fuel industry who has made business requests to the EPA. Pruitt’s rent sat far below far market prices. Federal lobbying disclosures reveal that during the period that Pruitt was renting from Hart’s wife, several of Hart’s clients awaited the results of pending matters with the EPA.

One active investigation and one completed investigation into a $43,000 phone booth

The Government Accountability Office ruled that Pruitt broke the law when he failed to notify Congress of his purchase of a $43,000 soundproof phone booth. The Financial Services and General Government Appropriations Act requires agencies to notify Congress of spending on office refurnishing exceeding the $5,000 limit. A second investigation into whether Pruitt was allowed to purchase the phone booth in the first place continues.

Four investigations into security spending  

During his first year in office,  Pruitt spent nearly twice as much on security as his predecessors spent each year on average: the EPA spent $3.5 million taxpayer dollars on salary, overtime, and travel expenses for Pruitt’s 20-person security team in 2017. Investigators recently took up allegations that Pruitt improperly used his team for personal travel to Disneyland, a Rose Bowl game, and other leisure destinations.

Two investigations into travel expenses

The EPA Inspector General is taking a closer look at Pruitt’s use of public revenue to fund frequent visits to his home in Oklahoma, his flights on first-class private aircraft and military jets, and his trips to Italy and Morocco. Also under investigation is two weeks of travel in Italy for Pruitt and his aides last June that cost American taxpayers more than $120,000 and a 40-minute flight from Denver to Silverton, Colorado that cost $5,719.

Two investigations into pay raises for Pruitt Aides

Two aides received large raises in a process that failed to comply with usual procedures. After the White House did not approve raises for two Pruitt aides, Sarah Greenwalt and Millan Hupp, Pruitt used a provision of the Safe Water Drinking Act to raise Ms. Greenwalt’s annual salary from $107,435 to $164,200 and Ms. Hupp’s salary from $86,460 to $114,590. Ms. Hupp likely violated federal ethics standards prohibiting personal assistance from a subordinate when she helped Pruitt search for a summer apartment, obtain tickets to the Rose Bowl game, and hunt down a used mattress from the Trump International hotel.

Pruitt has made other outrageous spending decisions not specifically targeted in these investigations. Fox News Research recently tweeted a breakdown of “(E)xpensive (P)ruitt (A)gency” spending, highlighting the purchase of two desks for $70K, 12 customized fountain pens for $1,560, and journals for $1,670.

Interestingly, Pruitt’s scandals sound a lot like petty graft by high-level officials in other countries. In an event hosted by the Open Government Hub in June — “When Heads of State are embroiled in Cases of Serious Crime and Corruption”—panelist David Lewis, executive director of Corruption Watch South Africa, likened the crooked practices of Jacob Zuma, former president of South Africa, to those of Scott Pruitt. Zuma resigned as president in February of 2018 after South Africa’s National Prosecuting Authority reinstated charges of racketeering, fraud, money-laundering, and corruption. Two years prior to his resignation, South Africa’s top court ruled he had violated the constitution by buying a private rural estate with public dollars. Sounds familiar, doesn’t it?

This sort of petty corruption is arguably less harmful than the sort of corruption that allowed Zuma’s business associates to influence the allocation of government contracts, and allowed Pruitt to repeal climate laws at the behest of corporate energy lobbyists. However, petty graft is perhaps more effective at generating the public outrage that David Lewis identified as key to sustaining support for investigations into government officials. Lewis suggested that public opinion is more likely to be influenced by stories about $43,000 phone-booths—by a sense that “grubby hustlers are squeezing private gain from what is meant to be public service”—than it is to be influenced by systemic corruption. Going after frivolous theft at high-levels, he argued, could engage the public by illustrating, in tangible terms, the greed and entitlement of the state.

Environmental organizations, journalists, watchdog groups and congressional Democrats have certainly done much to bring Pruitt’s scandals to public light. How, then, does Pruitt survive?

For one, Pruitt’s ethical transgressions, though well-documented and well-publicized, may not be well-known. A May 2018 poll commissioned by Axios and conducted by HarrisX finds that 48 percent of Americans are not familiar with the scandals surrounding Pruitt and the EPA. Only 16 percent of 2000 survey respondents reported they were “very familiar” and 36 percent were “somewhat” familiar. 17 percent view Pruitt favorably, 22 percent unfavorably. However, 30 percent hold neither view, and 32 percent have never heard of him.

Another reason may be that Pruitt has yet to fall from Trump’s good graces. Politico reporter Jack Shafer writes that the EPA chief “perseveres mostly because the president admires his swagger.” Pursuing personal enrichment at public expense and deflecting outrage, unabashed are two moves out of Trump’s own playbook.

Mounting frustration from Republicans, however, could threaten their cozy relationship. Since the beginning of June, several Republican Senators have publicly voiced concerns about Pruitt’s management of the EPA, but stopped short of demanding he resign. Meanwhile, four House Republicans—Rep. Frank LoBiondo (N.J.), Carlos Curbelo (Fla.), Ileana Ros-lehtinen (Fla.), and Elise Stefanik (N.Y.) —have gone so far as to advocate for Pruitt’s firing. In addition to congressional pressure, it seems pressure from Trump loyalists is needed to sway the president’s opinion on Pruitt. Outrage from the president’s base would likely be decisive in a decision to fire the EPA chief—a decision which Republican Senators have left up to the administration (at least for now).

Your advocacy is critical in spreading information about Pruitt’s ethical scandals to those who are unaware, and in pressuring congressional Republicans to pressure Trump (ideally, before they retire from political office). Sign the Boot Pruitt petition. Share this blog, and other articles about EPA corruption, on your social media accounts and call your Republican representatives to demand they speak out now.

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The Corporate Cabinet: Director of National Intelligence Dan Coats

Corporate Connections: Cooper Industries, DaVita Inc.

Director of National Intelligence Dan Coats served as a Republican senator from Indiana from 1989 to 1999, and again from 2011 to 2017. Between his Senate stints, he was U.S. ambassador to Germany under President George W. Bush, and then a lobbyist with the firm King & Spalding.

  • In 2015, Coats was the 20th wealthiest senator with a net worth of $12 million.
  • As a registered lobbyist, Coats represented clients including Google, Festo and Lockheed Martin, and earned more than $600k in this role at King & Spalding, a lobbying organization that took in $8 million in fees in 2008.
  • Coats was co-chairman of a team of lobbyists at King & Spalding that worked with electrical products manufacturer Cooper Industries to oppose Senate legislation that would have closed a lucrative offshore tax loophole.
  • Coats served as a lobbyist for DaVita Inc., one of the largest kidney care providers in the United States.
  • During Coats’ time as lobbyist, two whistleblower lawsuits were filed against DaVita. One claimed the company was paying kickbacks to physicians in exchange for patient referrals, and the other accused DaVita of defrauding Medicare and Medicaid to increase profits.
  • Coats used his Washington connections as a lobbyist to introduce executives from companies like DaVita and Google to members of Congress.
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The Corporate Cabinet: Secretary of State Mike Pompeo

Corporate Connections: Koch Industries

Former CIA Director Mike Pompeo became Secretary of State after President Donald Trump fired Rex Tillerson. A former member of the House of Representatives from Kansas, Pompeo has been described as “the congressman from Koch” for his close ties to Koch Industries, the conglomerate based in Pompeo’s former congressional district.

  • In 1998, Pompeo founded Thayer Aerospace, an aircraft part maker, with fellow West Point alumni. The company was founded in Wichita, Kan., headquarters of Koch Industries. Wichita’s Koch Venture Capital provided some of the capital for Thayer Industries.
  • After selling Thayer Aerospace, Pompeo became president of oil rig firm Sentry International, a partner to Koch Industries.
  • When Pompeo ran for Congress in 2010, his campaign received $80,000 from Koch Industries’ PAC and employees, more than any candidate had ever received in a single election cycle. In 2012, Koch contributions to Pompeo’s campaign totaled $110,000. Over the course of his four congressional campaigns, Pompeo received $400,500 from Koch Industries’ corporate PAC and individual employees.
  • In a 2012 op-ed for Politico, entitled “Stop harassing the Koch Brothers,” Pompeo praised the billionaire brothers Charles and David Koch as “U.S. citizens, taxpayers, entrepreneurs and employers” and said Koch Industries and its employees “are among the most hardworking and generous in our community.”
  • As a congressman, Pompeo’s chief of staff was Mark Chenoweth, who previously worked in Koch Industries’ general counsel’s office. Pompeo also proposed legislation defunding a federal database of complaints about consumer products and an Environmental Protection Agency (EPA) registry of greenhouse-gas polluters. This legislative agenda mirrored that of Koch Industries.
  • Pompeo is a frequent guest at the Koch brothers’ gatherings and has called Democrats’ criticism of Koch officials a “public flogging.”
  • In a 2013 C-SPAN interview, Pompeo cast doubt on the veracity of climate change, saying, “There are scientists that think lots of different things about climate change. There’s some who think we’re warming, there’s some who think we’re cooling, there’s some who think that the last 16 years have shown a pretty stable climate environment.” At his Senate confirmation hearing in March 2018, he changed his stance, saying that “the climate is changing, there’s a warming taking place” and that he was “happy to concede that there is likely a human component to that.”
  • Koch Industries has 120,000 employees in 60 countries worldwide, giving the company a major interest in foreign affairs.

 

 

 

mulvaneycorp

The Corporate Cabinet: Office of Management and Budget Director Mick Mulvaney

Corporate Connections: Koch Industries, World Acceptance, Paulson & Co.

John Michael “Mick” Mulvaney is the Director of the Office of Management and Budget (OMB). In late 2017, he also was named acting director of the Consumer Financial Protection Bureau (CFPB), a move that is being challenged in court.

Mulvaney represented South Carolina in the U.S. House of Representatives from 2011 until 2017. He was confirmed as a member of President Donald Trump’s cabinet in February 2017.  A former member and current ally of the ultra-conservative House Freedom Caucus, Mulvaney has boasted: “I don’t think anyone in this administration is more of a right-wing conservative than I am.”

Koch Industries was the fourth-largest contributor to Mulvaney’s campaigns, with a total of $35,000 in donations. While in Congress, Mulvaney introduced two bills to remove tariffs on chemicals, legislation that would benefit one of Koch Industries’ subsidiaries.  As OMB director, Mulvaney met with two Koch lobbyists. Mulvaney has been open about the connection between campaign donations and access to elected officials. Speaking to a conference of bankers Mulvaney said, “We had a hierarchy in my office in Congress. If you’re a lobbyist who never gave us money, I didn’t talk to you. If you’re a lobbyist who gave us money, I might talk to you.”

Mulvaney introduced legislation to release government-controlled mortgage finance companies Fannie Mae and Freddie Mac from government control. This move likely would cause their stock prices to soar, bringing a windfall for investors speculating on their stock, including hedge fund billionaire John Paulson. A Trump donor with whom Trump personally has invested money, Paulson has been aggressively advocating for returning Fannie and Freddie to the private sector. Paulson’s hedge fund, Paulson & Co. has made bets that would pay off if the companies were privatized.

As a candidate and member of Congress, Mulvaney  received nearly $63,000 from payday lenders. As acting director of the CFPB, Mulvaney has consistently worked for corporate interests. Mulvaney has said the agency may reconsider a rule that puts restrictions on payday loans. He has ended multiple investigations into high-cost lenders, including one involving World Acceptance Corp., a lender from which Mulvaney had received campaign donations.

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