In January the powerful Alexander Strategy Group shut down its public operations faster than merchants peddling pirated DVDs on Canal Street who hear the cops are on the way. The well-connected Republican lobbying firm, founded and run by former senior staffers of embattled ex-House majority leader Tom DeLay, explained that the publicity from the Jack Abramoff mega-scandal had fatally damaged its business. On the surface, it appears to be the fall of a major player in the GOP’s K Street Project, which has made lobbying a highly partisan industry. But don’t count out ASG: Already, according to the Washington Post, most of its lobbyists are setting up a “successor firm.”
While ASG spins its problems as collateral damage from the Abramoff affair, it’s hardly the victim of an errant public relations bomb. In fact, the firm was deeply entangled in several of the Washington scandals. Its swift shutdown offers a rare X-ray of the elaborate lobbying shell game that trades access to lucrative government contracts for funds to fill the campaign war chests keeping Republicans in power. Founded by DeLay’s former chief of staff, Ed Buckham, ASG was a centerpiece of this game. In a recent report, Public Citizen lays out the rules: “In this partnership, corporations, trade associations and lobbying firms are pressured to hire only Republicans…. Those lobbyists then help the Republican leadership to ‘whip on the outside’–to get Republican members of the House to vote for the leadership’s legislative agenda. The lobbyists also raise enormous sums of money from their clients to ensure that Republicans remain the majority in Congress. For this fealty, the leadership grants the lobbyists access to the decision-makers and provides legislative favors for their clients.” ASG had close ties to Abramoff, shared clients with him and had an overlap with some staff. The firm offered what few lobbying houses could: instant standing with the most powerful Republicans and a shortcut to the most lucrative contracts in Congress.
ASG was organized out of the same Washington townhouse as another DeLay-connected operation, the US Family Network, established in 1996 as a secret mini-war room for attacking Democratic candidates. In 1999 Buckham–then operating on behalf of USFN–funneled some $300,000 in soft-money contributions from the National Republican Congressional Committee (NRCC) through USFN to an organization called Americans for Economic Growth, which in turn used the funds to run attack ads against Democratic candidates. Buckham ran the townhouse operation with longtime DeLay crony Jim Ellis. USFN was established almost entirely with money from Abramoff’s clients, according to a report in the Washington Post. Eventually, in 2004, the FEC fined the NRCC in connection with the scandal. The townhouse was also used at various points by DeLay’s Americans for a Republican Majority (ARMPAC), headed by Ellis, as well as a PAC run by DeLay’s handpicked successor, Roy Blunt of Missouri. As it happens, when Blunt arrived in Washington and needed someone to run his PAC, DeLay sent Ellis. Shortly after Ellis was indicted in Texas in connection with another DeLay PAC, Texans for a Republican Majority, Blunt’s PAC increased its payment to Ellis to $4,000 a month, up from $3,000. Among the other tidbits in this incestuous affair: ASG employed Tom DeLay’s wife, Christine, for four years.
While Abramoff, DeLay and Randy “Duke” Cunningham dominate the headlines in the current “lobbying scandal” media reports, ASG deserves to be heavily scrutinized for its role in each of those scandals and others not yet on the mainstream radar.
Just a few months ago it would have been difficult to predict ASG’s downfall. The firm was enjoying a prosperous 2005, ranked as a top 25 lobbyist by National Journal, with revenues on a serious rise–up 34 percent in one year, to $8 million. In addition to powerhouses like PhRMA, Enron, TimeWarner, Microsoft and Eli Lilly, ASG counted among its clients over the years several evangelical Christian causes and organizations–among them, right-wing media operations like Salem Com munications, the National Religious Broadcasters and Grace News. ASG was also a quiet workhorse in procuring lucrative military contracts for some of its clients. Recently, ASG was on the cutting edge of one of the fastest-growing industries within the military world–private security. With the occupations of Iraq and Afghanistan, mercenaries have found themselves in high demand, scooping up lucrative contracts from the occupation forces, local politicians and foreign corporations. After Blackwater USA had four of its operatives killed in Falluja, in March 2004, it hired ASG to manage its newfound fame. This past September Blackwater forces were among the first to arrive in New Orleans after Hurricane Katrina, snagging profitable federal security contracts. Blackwater’s press contact for its New Orleans operations was none other than Anne Duke, one of ASG’s fourteen lobbyists. In other news stories it was Paul Behrends, a partner at ASG and a friend of Blackwater found er Erik Prince. Behrends, as it happens, was a longtime national security adviser to Representative Dana Rohrabacher of California, who incidentally has emerged as one of Abramoff’s biggest defenders. A few months after hiring ASG in 2004, Black water’s Prince and the company’s president, Gary Jackson, both longtime GOP donors, made their first-ever contributions to DeLay. They also began contributing to several other ASG-favored lawmakers.
In November a coalition of security firms, Blackwater among them, began a push to recast their mercenary image under the banner of the International Peace Operations Association. And it was ASG they enlisted to help them do it. Among those registered by ASG as lobbyists for IPOA were several former DeLay staffers, including Buckham and Karl Gallant, former head of DeLay’s ARMPAC, and Tony Rudy, DeLay’s former counsel, who is deeply implicated in the Abramoff investigation. Despite the scandal, the head of IPOA, Doug Brooks, recently told Roll Call that the association with its ASG lobbyist would continue, saying, “We found them helpful in terms of what we were working on.”
Of all ASG’s activities, its military contracting work could bring it the closest to the recent spate of lobbying scandals. Among ASG’s select group of military-oriented clients is major GOP fundraiser Brent Wilkes. Wilkes was a “Bush Pioneer” who raised more than $100,000 for the President and served as the finance co-chair for the Bush campaign in California. More recently he won himself a new title–“Co-conspirator No. 1” in the Cunningham criminal investigation. He gave more than $630,000 in contributions and favors to the disgraced legislator, who pleaded guilty in November to taking $2.4 million in bribes in return for steering military contracts toward select companies. For years Wilkes has raked in tens of millions in taxpayer dollars doing what could arguably be done at Kinko’s–digitally scanning old paper documents for the military. Of course, it is presented in more sophisticated phrases, like “automated document conversion.” In addition to flights on his plane, Wilkes doled out more than $840,000 in contributions to over thirty Congress members and candidates. In turn, over the past decade Wilkes’s companies, including Automated Document Conversion Systems (ADCS), were awarded some $90 million in military contracts.
There are several tales, told by Pentagon insiders, of Wilkes becoming outraged at the suggestion that another company would be awarded a contract for document conversion. In 1999 Wilkes’s possessiveness caught the eye of the Pentagon Inspector General, who, according to the Washington Post, concluded that the contracts were granted through “irregular procedures.” Assistant Deputy Under Secretary of Defense Louis Kratz told the paper that he had requested the probe after both Cunningham and Wilkes had called him pressing for the release of funds for ADCS. “Kratz said he had never before experienced anything close to their ‘meddling’ and ‘arrogance.’ ” According to Kratz, Wilkes “implied that it was his money.”
A Nation investigation has revealed that, before Wilkes hired ASG to help him grease the Congressional wheels, he enlisted the services in September 1999 of a rookie lobbyist named Patrick McSwain. It was an interesting choice. Until August 1999 McSwain was Duke Cunningham’s trusted chief of staff. It is a federal crime for a departed senior Congressional staffer to lobby his former boss for one year after leaving. A review of Congressional lobbying records indicates that the day after leaving Cunningham’s staff, on August 9, 1999, McSwain registered as a lobbyist for defense giant General Dynamics, which received $33.2 billion in contracts from 1998 to 2003–mostly no bid contracts. On the registration form, McSwain specifically indicates his intent to lobby on the Defense Appropriations Bill of 2000. Cunningham had enormous control over that bill, serving not only on the Defense and Appropriations committees but also on the conference committee reviewing the bill. Alex Knott, head of the Center for Public Integrity’s LobbyWatch, says, “There’s a strong chance” McSwain violated federal law. “It would have been extremely hard to lobby on a bill that went before Representative Cunningham in so many areas and not have any correspondence with him or his staff,” he says. A month after his departure from Cunningham’s office, McSwain signed up, as his second client ever, Wilkes’s ADCS. And it was that same year, 1999, that Wilkes, flush with contracts won largely through his greasing of Cunningham, came into serious money, buying two new homes, one for $1.5 million. Did his new lobbyist–former chief of staff to his sugar daddy–have anything to do with this? It is hard to imagine that he didn’t. On his personal web page, McSwain boasts of his deep connections in Congress, “the personal and professional relationships with senior staff members that are a necessary part of any successful government affairs effort.”
McSwain went on to found the high-powered GOP lobbying firm Northpoint Strategies, along with his successor at Cunningham’s office, Trey Hardin. According to the Center for Public Integrity, from 2002 to 2004, Northpoint’s revenues made a whopping jump from $160,000 to $2.4 million. Its number-one client? The heavily Bush-connected Carlyle Group-United Defense, which paid the firm more than $1 million in 2003-04. Number two: the Titan Corporation (of Abu Ghraib fame).
If McSwain’s exploits are not on the radar of those investigating the broad network of individuals connected to Cunningham and Wilkes, they should be.
While McSwain turned his energies to Northpoint, Wilkes amped up his lobbying expenditures, using his firm Group W Advisors to funnel funds through ASG–some $620,000 since 2002. Group W itself was a registered lobbyist hired almost exclusively by other Wilkes-run or -affiliated companies. Group W in turn contracted with ASG. “It’s just creating another layer of difficulty for people to figure out who’s doing what for how much on what issues,” says Roberta Baskin of the Center for Public Integrity. Under ASG direction, Wilkes homed in on key legislators who, if greased properly, could make the contract-procurement process run smoothly. Former ARMPAC head Karl Gallant personally worked the Group W account for ASG, as did Tony Rudy.
Like Cunningham, DeLay flew three times on Wilkes’s private plane, operated by Group W Transportation. In late 2005 Texas prosecutor Ronnie Earle subpoenaed records from three of Wilkes’s companies that had given sizable contributions to DeLay’s Texans for a Republican Majority. The PAC was key in DeLay’s redistricting plan, which resulted in Republican victories in twenty-one of the state’s thirty-two Congressional districts in 2004. Among the contributions: $15,000 from Wilkes’s PerfectWave Technologies. According to the Houston Chronicle, Wilkes, his companies and his wife gave about $70,000 to DeLay’s PACs. And it paid off. Shortly after Wilkes hired ASG, PerfectWave racked up $40 million in federal contracts (from 2003 to 2005). In late January Earle subpoenaed four people affiliated with the company as part of his investigation of DeLay.
Tracing the reach of Wilkes’s political giving tree is no easy task. That’s because a fair portion of Wilkes’s donations are done through family members, employees and his shady network of what could only loosely be called “companies.” Many perform no identifiable service other than giving the impression of being separate corporate entities. The websites are flimsy and amateurish, many of them sharing the same office address as the Wilkes Corporation. They have almost no presence on the Internet other than campaign finance records indicating serious donations to GOP candidates and causes. In addition to PerfectWave Technologies, the Wilkes empire includes: Pure Aqua Technologies, Acoustical Communication Systems, Mirror Labs, Optimum Composite Design, MailSafe and other “companies.” Overwhelmingly, Wilkes’s lobbying money went to one place–military contract lobbying. As veteran Washington reporter/blogger Josh Marshall put it, “Wilkes specialized in finding companies or products for which the DoD had little or no use and then lathering up a few members of Congress so they’d force the Pentagon to buy his junk.”
While Cunningham has borne the brunt of this scandal, there are other prominent Republicans who deserve to be investigated–among them, DeLay’s protégé Roy Blunt. According to Public Citizen, “Ten of Blunt’s biggest contributors have hired [ASG] as their lobbying firm. The firm has been close to Blunt, as Blunt’s committees have paid ASG $485,485 from 1999 to 2002 for fundraising and consulting services. ASG’s clients, meanwhile, have funneled $581,866 into Blunt’s committees since 1999.” According to the group, Wilkes “has provided four subsidized trips to Blunt’s PACs.”
Another powerful Republican who has had questionable dealings with Wilkes is Duncan Hunter, chair of the House Armed Services Committee. He is from Wilkes’s home base of San Diego and has admitted that he, along with Cunningham, pressed Pentagon officials in 1999 to redirect a $10 million contract to Wilkes’s ADCS. Over the past decade, Wilkes, his associates and his company have given more than $40,000 to Hunter’s campaign coffers. Meanwhile, another member of the House Republican leadership, John Doolittle of California, “helped steer defense funding” to PerfectWave, according to the Washington Post. The paper notes that the company’s “officials and lobbyists helped raise at least $85,000” for Doolittle and his Leadership PAC from 2002 to 2005. Moreover, Doolittle’s wife was employed by an organization set up by ASG founder Ed Buckham. According to the San Diego Union-Tribune,
Wilkes “befriended other legislators, too. He ran a hospitality suite, with several bedrooms, in Washington–first in the Watergate Hotel and then in the Westin Grand near Capitol Hill.”
Among those who have taken serious money from Wilkes and his companies are Representative Jerry Lewis, head of the Appropriations Committee; Representative Jerry Weller and his PAC; and Senator Lindsey Graham. Since the Cunningham scandal broke, many Congress members have quietly given up Wilkes’s money, some of them donating it to charities. So bold was Wilkes about his paymasters that, according to the Copley News Service, he had a vanity plate on his jet-black Hummer that read MIPR ME–“a reference to Military Interdepartmental Purchase Requests, which authorize funds in the Pentagon.”
Like Abramoff, Wilkes and ASG are not anomalies in Washington. If anything, they are the prototypes for business as usual in the “revolutionary” years of the GOP-dominated Congress. It is of extraordinary significance that Wilkes was a major figure in George W. Bush’s fundraising efforts and that ASG was founded and staffed by the inner circle of one of the most powerful politicians in recent history. It speaks volumes to how far and wide these investigations should extend. The new lobbying reform bandwagon circling Washington is like those rubber bracelets made popular by Lance Armstrong–soon everybody made one with their own meaning and by the end none of them meant anything. The recent “lobbying scandals” could spark the beginning of real reform, but that’s highly unlikely. That would require tracing the vast network of conspirators to their new offices and titles, which would ultimately lead full circle, back to many of those responsible for heading the investigations–and their former chiefs of staff or their major campaign fundraisers.