Business as Usual? Crossing the Line Between Politics and Policy

NEW YORK —  On a recent day, Speaker Newt Gingrich’s former spokesman, Tony Blankley, served coffee in his Virginia home, along with a dose of his familiar spin. The topic was a controversial political consultant, Joseph R. Gaylord, and his role in the speaker’s day-to-day affairs. Blankley, ever the Gingrich loyalist, downplayed Gaylord’s influence, even insisting he’s rarely in the Capitol. Yet, at that exact moment, across the Potomac, Gaylord was spotted by a Democratic staffer chain-smoking in a House of Representatives bathroom.

Outside Washington, few people have heard of Gaylord. Yet, in the corridors of power, his footsteps echo loudly. “Joe Gaylord is empowered to supervise my activities, set my schedule, advise me on all aspects of my life and career,” Gingrich once instructed in a memo.

“He’s the best inside player in U.S. House politics without being a member himself,” says one GOP operative.

This dealmeister’s behind-the-scenes power violates congressional rules and ethical standards but it also reveals a lot about the culture of Washington now--particularly how life in the Capitol has become one long election campaign. The avalanche of revelations regarding the Clinton campaign’s finance shenanigans has buried a stark reality: Congressional Republicans, led by powerful non-members like Gaylord, have been adept at selling off government to the highest bidder.

Now, the line between winning office and serving in office has become so blurred that strategists and fund-raisers like Gaylord can literally move into the speaker’s office.

Gaylord, who masterminded the “contract with America,” is an independent political consultant. Yet, for years he has effectively run Gingrich’s office--in violation of House rules, since he is not a House employee and, therefore, not subject to provisions governing conflicts of interest and other concerns.

Today, he is a dominant force in the speaker’s legislative business, “the de facto chief of staff,” according to several current and recently departed staffers. One source, currently on staff, says Gaylord has somewhat reduced his physical presence in the office in response to increased scrutiny, but not his place in the decision-making process.

Gaylord mapped the money side of the contract campaign, and figured out how to repackage the GOP’s corporate-friendly agenda to the masses. “Newt raised, under Joe’s guidance, between events and letters, $100 million in the last election cycle, which is more than anyone besides the president has ever raised,” says Blankley. Once the Republicans gained power, Gaylord supervised an effort to use government to pay back those contributors through business-friendly legislation. (Sound familiar?)

The heavily advertised contract with America contained 10 fairly brief items. But the legislation that followed was massively expanded to include many big-donor-friendly provisions unknown to the public. Gaylord was a key participant in both phases--the campaign and the bill writing. When one Gingrich advisor suggested putting education into the contract, Gaylord vetoed the idea.

“The actual day-to-day supervision of the writing of the legislation was done by aides to [Majority Leader Dick] Armey, by a representative of the Republican National Committee and by Joe Gaylord,” reports veteran Washington chronicler Elizabeth Drew in her book, “Showdown.” Under Gaylord, the contract was expanded into a veritable pottage, including such things as a capital-gains tax cut and funding of the Reagan-era’s wacky “Star Wars” missile-defense shield.

Drew also describes a meeting in Gingrich’s office to discuss the Medicare bill, in which those assembled went through the proposal “line by line.” The group included Gaylord. A review of that bill shows a key provision allowing controversial Medical Savings Accounts, trumpeted by Golden Rule Insurance, whose PAC and executives gave a combined $150,000 to GOPAC, $42,500 to Friends of Newt Gingrich and $600,000 in GOP soft money.

The blatancy of the business takeover was especially transparent when telecommunications entrepreneur Donald G. Jones worked as a “volunteer” member of Gingrich’s staff, on a bill of direct importance to his business; the Telecommunications Act of 1995 was arguably the most important bill of the 104th Congress. Jones also used Gingrich’s office to set up congressional trips to New Zealand--where he was bidding for a huge chunk of that country’s telecommunications market. He was such a regular presence that he even had an official congressional identification card.

Gaylord himself benefited handsomely from such goings-on. Though his full income, and its sources, are unknown, Gaylord’s consulting firm, Chesapeake Associates, shows up on reports filed by the National Republican Congressional Committee, Friends of Newt Gingrich and, to a lesser extent, the Republican National Committee. One Gingrich friend estimates Gaylord has been making $350,000 to $500,000 or more annually in recent years from the affiliation.

“Newt did reward Joe,” says Blankley.

Gaylord’s role in Gingrich’s congressional activities is prohibited under House rules, where a strict line is maintained between legislative and political work. One is either an outside political person, or a Hill staffer. Gaylord does not hold a Hill position, and does not comply with the many disclosure requirements imposed upon federal employees.

Back in December, 1995, the Ethics Committee, responding to a complaint by the Nader-affiliated Congressional Accountability Project, warned Gingrich that Gaylord must stop working in his office: “Your use of Mr. Gaylord was in violation of House Rule 45.” The speaker was told that Gaylord’s presence “creates the appearance of the improper commingling of political and official resources. Such activities, if they are continuing, should cease immediately.” They haven’t.

Many of Gingrich’s own repeated ethical whoppers were committed on Gaylord’s advice. There was, for example, his $4.5 million book advance from Rupert Murdoch’s Harper Collins, which even many Gingrich allies opposed, and which the speaker finally returned after much criticism. There was also Gingrich’s dissembling with the Ethics Committee, which resulted in a reprimand from the House and a $300,000 fine.

Gingrich’s ploy was, in fact, remarkably similar to one Gaylord himself had tried several years before. The speaker claimed that his televised college course was a nonpartisan, nonprofit venture, though it was actually designed, in the speaker’s own words, to “build an offense so that Republicans can break through dramatically in 1996.” In 1989, a U.S. tax court revoked the tax-exempt status of Gaylord’s American Campaign Academy, which was improperly claiming to be “purely educational” and “nonpartisan” when it clearly was a GOP ninja campaign training camp.

Gingrich’s and Gaylord’s disrespect for congressional propriety was again apparent in January, when a furious Ethics Committee member, Rep. Benjamin L. Cardin (D-Md.), released a 1995 Gaylord memo urging a Nixon-style counterattack on the committee which was then investigating the speaker. The dirty-tricks plan called for pressure on GOP members of the panel, and “targeting” committee Democrats. It also recommended they “get the Clinton administration under special prosecutor problems, and have the Clinton administration get the House Dems to back down.” It may not be entirely coincidental that, in the ensuing months, the wish list was fulfilled.

The current Gingrich strategy, as outlined in Gaylord’s brazen memo, is to stay out of the limelight while Clinton gets shellacked. Earlier this month, though, Gingrich emerged to bash the president for fund-raising violations. Yet, his own fine made the speaker particularly vulnerable. And with congressional Republicans already thinking about a replacement, Gingrich’s almost suicidal ethical blindness is only more striking. As one Hill Democrat puts it, “one more misstep and Newt’s a goner.”