In February of this year, news broke that Treasury Secretary Jack Lew received an exit package worth over $1 million from Citigroup shortly before joining the Obama administration in 2009. In fact Lew’s contract with Citigroup made explicitly clear that the banker’s eligibility for a special bonus was contingent on his securing a “full time high level position with the U.S. government or regulatory body.”
Critics like Bloomberg News columnist Jonathan Weil were astounded by what appeared to be “some sort of a bounty” paid by Citigroup to burrow their executives deep within government. But far from an aberration, such bonuses appear to be fairly common on Capitol Hill.
Recent disclosures and employment agreements reviewed by The Nation show that current leadership staff to both Democratic and Republican lawmakers have received six-figure bonuses and other incentive pay from corporate firms shortly before taking jobs in Congress. In many cases, these staffers are well positioned to influence multibillion-dollar legislation on issues ranging from tax policy to defense, and which impact their previous employers. If government officials turned lobbyists reflect a well-known “revolving door,” paying corporate employees big bucks to leave lucrative posts to take jobs in government reflect a “reverse revolving door.”
Robert Walker, an attorney and former chief counsel to both the House and Senate ethics committees, told The Nation that ethics rules authorize congressional staffers to receive bonuses from prior employers as long as the money is being paid for work previously performed. Such bonuses and other financial awards are ostensibly allowed so long as they have “not been enhanced because of the individual’s congressional employment.”
But it is almost impossible to discern the circumstances under which a lobbying firm or corporation gives bonuses to departing employees who take powerful political positions. Such information is closely guarded, and none of the employers The Nation spoke to were willing to share this type of information.
Congressional staffers can earn as much as $170,000 as a federal employee, but such pay pales in comparison to what many have come to expect on K Street, where top lobbyists earn several million a year. The bonuses, which cut across industries, from defense contracting to broadcasting, and which can amount to several hundred thousand, help staffers to maintain the fixed costs associated with a lobbyist lifestyle.
This is emblematic of the cash culture of K Street, where salaries continue to climb as special interests seek power in Washington, says Jeff Connaughton, a former lobbyist and senior congressional staffer. To Connaughton, who chronicles the influence of big money in Congress in his 2012 book, The Payoff: Why Wall Street Always Wins, bonuses paid to reverse revolving-door lobbyists must be judged on a case-by-case basis. Some, he said, are simply a share of profits earned during the previous year. But in some cases, bonuses are part of an effort by special interests to maintain influence on Capitol Hill.