By Jeffrey H. Birnbaum
Tuesday, July 29, 2008
C harles Steele Jr. is the president of the Southern Christian Leadership Conference and a very prominent fellow. Two of his distinguished predecessors were Martin Luther King Jr. and Ralph David Abernathy, leaders of the civil rights movement of the 1950s and '60s.
This week, the SCLC is celebrating its 50th anniversary at a convention in New Orleans.
Steele is upset about something that happened before the celebration. A handful of Southern newspapers published an op-ed article under Steele's name on July 18 that his lawyer and the SCLC say he did not write or authorize.
The episode opens a small window onto an open secret of lobbying. Public relations firms regularly solicit authors of opinion-page articles, draft the pieces for them and place the articles in publications where they will have the most impact -- all for a fee.
Usually the collaboration comes off without a hitch and no one is the wiser. But apparently that didn't happen here.
The commentary criticized pending federal legislation that would reduce credit card fees and suggested that retailers stand to profit from it. The measure has been the subject of a long-standing feud between retailers, which want to limit the fees, and credit card companies, which don't.
The commentary reads: "The proposed law would boost the profits of Wal-Mart, J.C. Penney and Home Depot, but it would take money out of the pockets of the small businesses and consumers it's supposed to help."
Wal-Mart is listed on the SCLC's Web site as a sponsor of the organization. No one at the SCLC would want to insult a large benefactor.
According to a statement forwarded to The Washington Post by the SCLC's spokeswoman, Steele "is angry over an unauthorized publication of an opinion editorial that recently appeared in several prominent regional newspapers naming Dr. Steele as the author."
In a statement, Steele's attorney, David M. Walker, said the commentary's publication was "reckless" and "irresponsible."
Walker said in an interview last week that he thinks the K Street public relations shop LMG was behind the article in some way, and that he has been in contact with the firm. "I believe LMG played a role in this scenario; I can't say how big a role," he said. "LMG is in that chain somewhere."
LMG is working for a group of lobbyists for banks, credit card companies and others with similar views called the Electronic Payments Coalition. The firm would say only that it was tangentially involved. A spokesman said yesterday that LMG "reached out through its contractors" to provide "advocacy materials" to the SCLC and "urged the group to go public with opposition to the bill."
Dexter M. Wimbish, SCLC general counsel, played down LMG's role in the matter. "Based on our investigation, we don't see a reason to release a statement about LMG at this point," he said an interview yesterday. "LMG at this point has not been determined to be the entity that placed the op-ed."
Clearly, though, an outsider helped produce the article. "We have discovered that the op-ed that ran apparently was a draft . . . that had not been authorized by the president. That draft should not have gone out," Wimbish said. "The draft came from a third-party contractor and never got to the organization, and that's where the breakdown in communication took place. We're trying to determine who gave the authority to publish the draft."
All of this leaves a lot of questions unanswered. What exactly was LMG's role? Who is this mysterious contractor? Who placed the op-eds in the newspapers?
Editors of two Alabama newspapers that carried the article, the Tuscaloosa News and the Montgomery Advertiser, declined to comment.
Late yesterday, Wimbish said the organization was ending its probe into the origins of the problem. "Upon final review, we have discovered that the wrong draft of the op-ed was incorrectly submitted. The correct draft should not have referenced Wal-Mart or Home Depot," he said. "Any previous statements on this matter by SCLC or anyone associated with SCLC or President Steele on this issue are hereby moot," he added.
A Huge Housing Victory
Passage over the weekend of the wide-ranging housing rescue bill was a victory for a coalition of banks and mortgage insurers that has been fighting for nearly a decade to rein in the mortgage finance giants Fannie Mae and Freddie Mac.
FM Policy Focus, which was founded in 1999 as FM Watch, has had to battle uphill for most of its existence. Fannie Mae and Freddie Mac were once considered invincible lobbying machines, and the FM upstarts were nothing more than nippers at their heels.
The nonpartisan Center for Responsive Politics reported that the two companies spent $170 million on lobbying over the past decade. Their executives and allies dumped tens of millions more into the coffers of powerful lawmakers.
When the dissident group started, "no one thought we had a chance," said W. Michael House of the law firm Hogan & Hartson, FM Policy Focus's executive director from Day One of the anti-Fannie-and-Freddie effort.
His group spent $3 million to $3.5 million a year on lobbying and began to give some of its own contributions as well. Eventually, its complaint that the companies were inadequately regulated began to gain traction when both firms faced multibillion-dollar accounting scandals and lawmakers publicly questioned the high pay of their executives.
After years of work, FM Policy Focus's position finally became the capital's consensus. Over the weekend, in fact, Fannie Mae and Freddie Mac endorsed the creation of a tough new regulator, a position that House never thought he would live to see.
Along with House's Hogan & Hartson, other FM lobbyists included Patton Boggs, Akin Gump Strauss Hauer & Feld, BGR Holding and Podesta Group.
FM Policy Focus is chaired by former congressman J.C. Watts Jr. (R-Okla.). Its members, all of which have a beef of one kind of another with Fannie and Freddie, include the Financial Services Roundtable, which represents 100 of the nation's largest financial services companies, and the Mortgage Insurance Companies of America.
So, now that it's won, what's the future of FM Policy Focus? House won't say, but most observers foresee an end to one of Washington's most unlikely lobbying victors.Hire of the Week
The lobbying firm co-founded by former congressman Norman F. Lent (R-N.Y.) -- Lent Scrivner & Roth -- will soon be gone.
Three senior professionals from Lent Scrivner & Roth said last week that they will join Dow Lohnes Government Strategies. Two of them were Michael S. Scriv ner and Norman F. Lent III, son of the former congressman. Their departure follows the announcement in May that Alan J. Roth was heading over to be an executive at the U.S. Telecom Association.
"Lent Scrivner & Roth will be winding down as of July 31, and three of their people will be moving over to Dow Lohnes Government Strategies on Aug. 1," Stephanie Stadler, a spokeswoman for Dow Lohnes, said by e-mail. Former representative Lent, she added, has lately "played a small role in the firm's day-to-day activities and with this announcement he will be completely retired."
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