The way his associates told it, Michael K. Deaver was embarrassed by the checks that Trans World Airlines kept sending each month.
It wasn't that the former White House aide didn't try to earn the money the airline had agreed to pay his newly formed lobbying firm. It was just that TWA had nothing for Deaver to do.
As a result, Michael K. Deaver & Associates received $250,000 for making three telephone calls, sending staff members to several planning sessions with TWA officials and attempting to help free the airline's hijacked Boeing 737 jetliner from the Beirut airport.
That was the sum of the firm's work for TWA, according to testimony at Deaver's six-week trial on perjury charges. Were TWA executives shocked or troubled? Not according to their testimony. Deaver, they said, had earned his pay.
Deaver's dealings with TWA, perhaps more than any of his contracts described at the trial, provide a rare view of how high-priced lobbying works in Washington. It also illustrates how some of the nation's largest corporations willingly -- sometimes desperately -- pump millions of dollars into costly lobbying campaigns, often with little hope of more than bending the ear of a key government executive.
"I'll call Elizabeth," Deaver was quoted at the trial as saying. For TWA executives frantically seeking to thwart a takeover by investor Carl C. Icahn, that promise -- to contact then-Secretary of Transportation Elizabeth Hanford Dole -- appeared to have been all the assurance they needed that Deaver would give them their money's worth in Washington.
"We did everything we could here . . . everything," recalled TWA president and chief executive officer C. Edward Meyer during the Deaver trial. Deaver, it turned out, was just one player in a costly "team" that the airline assembled in late May and early June 1985 in its unsuccessful efforts to derail Icahn.
In all, TWA hired six Washington firms, including the law firm of former transportation secretary Brock Adams, a Democrat, in their bid to block Icahn. What the overall effort cost the company's stockholders and what the other firms did was not disclosed in the court.
Even so, the TWA lobbying blitz shows how specialized, defensive and extremely expensive Washington lobbying has become in recent years, according to several Washington lobbyists. It also illustrates, they say, that many times the price tag exceeds the payoff.
Whitney North Seymour Jr., the former U.S. attorney from Manhattan who prosecuted Deaver, has described the new lobbying as a problem of "too much 'loose' money and too little concern in Washington about ethics in government."
Lobbyists counter that with the growth of the federal government as a major purchaser of goods and supplies, the subdivision of congressional power in more than 160 committees and subcommittees and the seemingly constant efforts to rewrite tax legislation, lobbying has become a game few corporations can afford to ignore.
Deaver's clientele were drawn from the Fortune 500's corporate cream, companies such as Boeing Co. and Rockwell International Corp., which had big stakes in federal spending, and from some of the strongest U.S. allies, among them South Korea and Canada.
All were clamoring for more of what lobbyists call "coverage" in the capital, and almost all sought Deaver out and readily signed up for his standard $250,000-a-year-plus-expenses contract. If the testimony disclosed few complaints about Deaver's work, it also revealed few outright successes.
The trial scorecard:South Korea: Hired Deaver for $475,000, the highest any client paid, to help improve Korea's image. Deaver's coup, according to prosecutors, was getting a Korean trade envoy into the Oval Office to present a special letter from Korean President Chun Doo Hwan that his firm had helped draft. Philip Morris International Inc.: Hired Deaver to help crack into the South Korean tobacco market, currently closed to U.S. cigarettes. Deaver met with top Korean leaders, but at the end of his contract, the country had not budged from its prohibition on U.S. brands. Boeing Co.: Hired Deaver to help sell two of its 747 jets to the Air Force as new presidential jets. Deaver talked to two White House officials about playing a bigger role in the airplane competition. Boeing won the contract after McDonnell-Douglas dropped out of the competition. Rockwell International Corp.: Hired Deaver to help secure funding for the space station proposed by the National Aeronautics and Space Administration and the B1 bomber project. The space project was approved but whether Deaver contacted the president over the issue, as the prosecution hinted, is unclear. Canada: Hired at the urging of Canada's U.S. ambassador, Allan E. Gotlieb, Deaver was accused of working while still at the White House to gain appointment of a special envoy to resolve the acid rain pollution issue. He was cleared of that count and there was no testimony on what his firm did for Canada. Puerto Rico: Hired by the Wall Street investment firm of Smith Barney, Harris Upham & Co., which wanted to sell bonds for the island's government, Deaver's firm lobbied to retain a special tax benefit. After Deaver talked to Treasury Secretary James A. Baker III and others, the administration dropped its request to change the provision.
There were other clients, among them CBS, Korea's huge Daewoo Corp., the Home Group, a New York-based insurance company, a group of Caribbean countries with sugar import quotas. But there were no allegations of improprieties about his work and no testimony on what his firm did for them.
Deaver did not work alone. He had assembled a staff of about eight associates, many of whom had worked with him at the White House and none of whom were lawyers.
Some were specialists in trade and health issues, and they prepared reports and "talking points" on the lobbying issues that Deaver was to address, according to trial testimony. Deaver's principal job was to deal with the clients and shape the overall "strategic planning."
"When I came to town there were 10,000 lawyers here," said Lloyd N. Cutler, one of the city's premier lawyer-lobbyists who established his practice here in 1946. "Now there are 40,000 to 50,000."
What are they doing? Lobbyists talk of their clients' needs to "cover" different agencies and congressional committees, each requiring still more lobbyists and still larger lobbying budgets. "On some issues, you don't need a person, you need armies," said Cutler.
Deaver, the lobbyists say, was merely one of thousands of former government workers who realized that he, too, could make a lot more money by joining what lobbyist Robert G. Beckel calls Washington's "unbelievable growth industry."
"It grows when the government gets bigger because everyone wants a bigger piece of the pie and it grows when the government gets small because everyone wants to protect their piece of the pie," said Beckel, a former aide in Jimmy Carter's White House. He is president of a firm called National Strategies, which specializes in building grass-roots support for various issues.
When Deaver left his $75,100-a-year White House job May 10, 1985, he was known as the man who had helped Ronald Reagan use television to craft a favorable image, the "vicar of visuals" as Time magazine once dubbed Deaver. He had been offered an annual salary of $500,000 by Burston-Marsteller, a large Washington public relations firm, but others had told him he could make more by forming his own firm.
"He didn't realize how valuable he was," said Kenneth A. Lazarus, a lawyer who suggested Deaver set up a business. Deaver's plan was to use the same skills he had used with Reagan for 20 years to help corporations and foreign governments polish their images with the American public. His goal was long-range "strategic planning," not "quick-fix" solutions.
Based on testimony at his trial, however, Deaver was able to count few successes in his firm's first year.
Since Deaver didn't take the stand and most of his clients abandoned him after only a year, the full story on how much work he performed and his long-range goals may never be known. The firm, which now operates out of a townhouse in Old Town Alexandria, has been "destroyed" by investigations of its lobbying, Deaver's lawyers said.
At the trial, Deaver was portrayed as operating in a world of working breakfasts at Georgetown's exclusive Four Seasons Hotel, being whisked through Seoul in one of the South Korean government's Mercedes, having a client use Nancy Reagan's Secret Service code name (Foxtrot) to call him on her Air Force plane and being important enough for Secretary of State George P. Shultz to give him 10 to 12 minutes the day of a crisis in the Mediterrean.
That image troubles many lobbyists in Washington and it may, as Cutler put it, come to haunt them next year when the Senate Judiciary Committee resumes consideration of new legal restrictions on lobbying by former government workers and individuals representing foreign governments. Cutler called the bill, sponsored by Sen. Strom Thurmond (R-S.C.) "never-again Mike Deaver legislation."
Anne Wexler, a Democrat who left the Carter administration to form a successful firm with Republican Nancy Reynolds, called Deaver's lobbying efforts "very atypical," an assessment shared by Cutler and others. "What he was doing was not the grueling day-to-day stuff of lobbying," said Frank F. Mankiewicz, vice president of Hill and Knowlton, a major public relations and lobbying firm.
"What a good lobbyist can do is present your facts to the government and get you time," said Mankiewicz. "That's what they call access."
Deaver seemed to have little trouble with that. He told Shultz of a tax benefit for Puerto Rico, a client. He mentioned to national security adviser John M. Poindexter that a South Korean envoy wanted to see the president. And he called on a senior military officer at the White House to press concerns of the Boeing Co. about a new presidential jet.
His initial effort to reach Dole on behalf of TWA came when the transportation secretary was traveling in Eastern Europe, but aides in her office deemed the call so important that James Burnley, then the No. 2 official in the department, was told to call Deaver to discover what he wanted.
Deaver wanted to know if TWA's request for an administrative hearing on whether Icahn was competent to run the airline had any chance of gaining Dole's approval. It didn't, but TWA officials were delighted that Deaver was able to provide them early intelligence on the likely outcome of their request, part of their efforts to "buy time" and stall Icahn.
After the Transportation Department rejected the TWA petition, Deaver's firm tried to develop other Washington strategies to help the airline. It made inquiries at the State Department on how to get the corporation's hijacked jetliner out of Beirut.
Jon F. Ash, TWA's former Washington vice president, ruefully recalled a Deaver employe reporting to him that "you've got a tough problem" with the airplane. "I knew that," Ash said.
The 737 left Beirut a few months later, but not through any efforts of the Deaver firm.
The new management that Icahn installed at the airline's Manhattan headquarters decided to let the contract lapse and made no requests for additional work by the firm, a decision that troubled Deaver, according to the testimony.
To several Washington lobbyists, perhaps the highest tribute the Deaver firm won during the trial was the hazy memory that many senior administration officials had of Deaver's calls to them.
A good Washington lobbyist "never, never" asks for anything and never leaves the impression with any official that he had been lobbied, Mankiewicz said. By that standard, the failure of most witnesses to believe they were being pressured was a compliment.
But Deaver's biggest mistake -- one he acknowledges in excerpts from his upcoming book -- was that in an industry that loves working in the shadows, he was too often in the spotlight.
Deaver was too visible for a Washington lobbyist. His image was reinforced by his decision to pose for a Time magazine cover in a rented limousine with the Capitol in full view.
That, said Beckel, "broke the cardinal rule: 'If you want to be influential, be quiet.' "