Getting Out and Staying Out

Honey won’t you open that door.”

-Ricky Skaggs

I’ve devoted several columns to Rudolph Giuliani’s legal representation of the company that makes OxyContin.

Rudolph’s drug-maker clients benefited from his great connections and knowledge of the Justice Department. Knowledge he gained on the government payroll.

I’m not upset that Rudolph took the information he gained in public life and turned it to private gain. People come out of government with expertise that is valued in the private sector.

I have a problem with politicians who take a “break” from government service, load up some clients and jump back into government. It seems to happen all the time in Washington. Since Rudolph is running for President, he is playing the game at a higher level.

A potential President should not have represented the company that made OxyContin. The company made need future influence with the Justice Department and will certainly need help with the Food and Drug Administration. It is worth big money for the company to have a potential buddy in the White House.

A recent issue of Vanity Fair did a terrific job in exposing Guiliani’s clients since he left public office. Both Vanity Fair and the NBC Nightly News discussed Guiliani’s OxyContin ties but talked about a number of his questionable clients.

Guiliani’s situation is unique. He left politics but trying to get back in at the ultimate level. He left politics completely broke. He told his second wife in a 2001 divorce that he only had $7000. Five years later, it is estimated that he is worth $70 million.

If Rudolph’s company were on the stock market, it would have gained 364% EACH YEAR.

What makes Rudolph valuable to clients is that he wants to come back in as President. If he flames out in his bid for the White House, he won’t maintain that 364% rate of return.

There is a cry from “good government” people that former politicians and regulators should not go into lobbying. Some entities make ex officials wait a year or won’t let them lobby at a place they used to work for.

I’m not as concerned about the ex government people turned lobbyists. I’m worried about the system that makes those lobbyists so effective.

I just finished reading Robert Reich’s book, Supercapitalism. Reich was former Labor Secretary for President Clinton and like many around Clinton, does not speak in clear and direct language. If you hang with it, the book offers some fascinating insights.

Reich said that in the 1970’s, only 3% of retiring Congressmen became lobbyists. Now nearly 30% do. The amount of money spent on government influence is huge. Banning Congressmen from would not change the dollar amount spent on influence, it would just change who delivers the message.

Influence peddling has become a big business and one not going to be legislated away. There has to be a uprising from voters to protest the effects of big money. It won’t happen soon. People are focused on getting through their daily lives. Politicians can distract attention with social issues and it is more fun for the media to cover the exploits of Britney Spears.

Since big interest groups have influence peddling culpability and no one seems to care, you can’t pick on retired lawmakers for getting their part of the pie. If you are going to fix the system, it needs to be overhauled completely.

Giuliani’s supporters claim that I am hypocritical since I don’t have a problem with retired Congressmen turning lobbyist but I have a problem with Rudolph. They point out that many of my criminal lawyer friends represent clients who are just as scummy as the ones that Giuliani represents.

The Congressmen are retired and generally don’t plan to come back. My lawyer friends aren’t running for President of the United States. Their clients aren’t looking for long term political influence. They are looking to avoid making license plates.

Rudolph is running for President of the United States of America. A person who has their finger on the nuclear button and who can influence the world economy should have a private life that is expleary.

There is a simple solution. Tell politicians that once you are out of government and start lobbying, you are barred from coming back. That would have changed the dynamic of Giuliani’s situation. He could have stayed poor and ran for President or been a super rich lobbyist.

He couldn’t have it both ways like he has it right now.

Don McNay is the author of Son of Son of a Gambler: Winners, Losers and What to do when you win the lottery. You can write to him at don@donmcnay.com or read his award winning syndicated column at www.donmcnay.com