After prodding from independent ethics officials, the Trump administration has released a list of the waiver certifications it granted to White House employees. These waivers allow personnel to participate in matters they were personally involved with as lobbyists, or to interact with colleagues at their former places of employment.
The 17 waivers granted in just the past four months demolish President Trump’s ethics pledges and his vows to drain the swamp. They enable Steve Bannon to talk to his friends at Breitbart and let Kellyanne Conway work with her former polling and consulting clients. They give former corporate lobbyists a prime perch inside the corridors of power.
But one particular pledge stands out, because the recipient appears to be engaged in direct assistance to his former client.
Andrew Olmem was a partner at the white-shoe Washington law firm Venable. Olmem, Republican chief counsel for the Senate Banking Committee during the passage of the Dodd-Frank financial reform, now serves as a special assistant to the president for financial policy, as part of the lobbyist-heavy team led by National Economic Council Director (and former Goldman Sachs president) Gary Cohn.
While at Venable, Olmem lobbied the government for a host of financial-industry clients, but the key one to consider is the insurance giant MetLife. His waiver enables him to participate in meetings and communications with former clients on six separate issues, among them “reforming the Financial Stability Oversight Council’s (FSOC) treatment of insurers.”
FSOC, a panel of banking regulators, must determine which financial institutions, whether they are banks or not, are so big and interconnected that their failure could pose risks to the country’s economic stability. Designated firms are subsequently subject to higher capital requirements and more stringent supervision from the Federal Reserve. So far, FSOC has only designated three non-banks, all insurance companies: AIG, Prudential, and MetLife.
So Olmem, a former MetLife lobbyist, can work directly on the biggest issue affecting MetLife, getting them out from under significant regulatory scrutiny. But it’s worse than that, because we actually know the lengths to which the Trump White House has gone to assist Olmem’s former client.
MetLife is currently fighting FSOC designation in federal court. Last year, Judge Rosemary Collyer, a George W. Bush appointee, overturned the designation on three grounds: that the FSOC never assessed the likelihood of MetLife experiencing financial distress, that it failed to include specific projections of the losses that would arise as a result, and that never considered the costs of the designation on MetLife’s business.
FSOC appealed Judge Collyer’s ruling, and the DC Circuit Court heard arguments last October. They were about to rule in the case, and given the makeup of the three-judge panel and the tenor of the arguments, it looked like Collyer would be overturned, allowing the FSOC to designate MetLife.
But on April 21, President Trump issued a memorandum to Treasury Secretary Steven Mnuchin, asking him to take 180 days to review the FSOC designation process. The memorandum asked the Treasury to analyze the same three points in Judge Collyer’s ruling in the MetLife case: whether the FSOC should assess the likelihood of financial distress, whether it should include specific loss projections, and whether it should incorporate costs to the designated companies in its analysis.
In other words, this was a custom-made presidential decree, written to assist a insurance company’s litigation with the government—-the same insurance company whose former lobbyist is now allowed to work in the White House on the specific issue at hand. There was no real reason to issue the memorandum: under a previous executive order, the Treasury Department was already reviewing all financial regulations. The only way this memorandum makes sense is as a tool to block an adverse ruling against MetLife.
By the way, the gambit worked. MetLife immediately filed a motion with the appeals court, asking it in light of the memorandum to delay its ruling for 180 days, until the Treasury finished its review. The FSOC’s counsel, the Justice Department—whose leadership was also chosen by Trump!—asked for 60 days to come up with a response to MetLife, effectively consenting to one-third of the delay. With the two sides in agreement, the court allowed the 60-day delay, with no action until July 11.
If nothing else, this gives MetLife a temporary reprieve from Federal Reserve scrutiny and capital rules, which will save the company millions in compliance costs. So the memorandum provided direct material aid to a corporation. Under the ethics waiver, MetLife’s former lobbyist could have written that benefit. It’s almost unquestionable that Olmem at least played a role in drafting it.
Olmem’s waiver says that “the need for your services outweighs the concern that a reasonable person may question the integrity of the White House Office’s programs and operations.” Reasonable people are indeed questioning! “What special attributes does Olmem bring to the job, other than a deep appreciation of the views of the corporations he will now help regulate?” asked Robert Weissman, president of the watchdog group Public Citizen. “For the Trump White House, even its own, highly touted ethics rules are no more than an inconvenience to be waved aside if they interfere with corporate business as usual.”
This sorry display shows the deep entanglement between Trump’s White House and corporate interests. It doesn’t end there: Energy lobbyist Michael Catanzaro is helping to set energy policy. Retirement-account- company lobbyist Shahira Knight is helping to set retirement policy. Olmem himself can work on policy affecting Puerto Rico’s fiscal crisis, despite having as former clients six former hedge funds that hold Puerto Rican debt and are fighting the commonwealth for full payment in court.
The MetLife situation is just the cleanest example of direct aid to an individual corporation, with its former lobbyist as facilitator. If that can get a waiver from ethics rules, the rules as a practical matter don’t exist.