One year ago, a House subcommittee investigating wrongdoing at the Department of Housing and Urban Development stumbled onto the dealings of Paul Manafort, a well-known Republican lobbyist who candidly admitted he engaged in "influence-peddling" while pursuing HUD contracts for clients.
The admission by a senior partner was a potentially damaging blow to the prosperous firm of Black, Manafort, Stone & Kelly. But as members of Congress and an army of reporters clamored for more information, another senior partner, Charles R. Black, took to the phones to calm the public relations waters. Manafort, and the firm, weathered the storm.
Now Black, the veteran political operative who ran HUD Secretary Jack Kemp's unsuccessful 1988 campaign for the Republican presidential nomination, has been called on again at a time of trouble for another friend and political associate. He has assumed the high-profile job of chief spokesman for the Republican National Committee, acting as a stand-in for his friend, RNC Chairman Lee Atwater, who is battling a brain tumor. GOP officials said they will rely on Black's connections and political instincts to lead the party as it prepares for the fall congressional elections.
In his first weeks at the RNC, Black has stepped up the party's rhetoric and encouraged President Bush to launch the anti-Democratic budget offensive earlier this week that some Republicans considered ill-timed and Democratic leaders said they found astonishing. Under Black, the RNC has also gone on the offensive on the savings and loan issue, buying ads in Mobile and Nashville newspapers during meetings of governors and state legislators in those cities to blame Democrats for the thrift mess.
Black's political instincts have been honed in years of dealing with the Reagan and Bush White Houses, running key state campaigns and lobbying intensively on Capitol Hill on behalf of a growing list of private clients, many of them foreign nations. But the breadth of that lobbying for Black, Manafort, Stone & Kelly's extensive client list has also raised questions about the potential for conflicts-of-interest as Black assumes his most visible role yet as a spokesman for the Bush administration and the Republican Party.
Democrats have been reluctant to highlight this issue, in part because of sensitivity about similar questions raised about Democratic National Committee Chairman Ronald H. Brown, whose law firm, Patton, Boggs and Blow, also does extensive lobbying work. While at the law firm, for example, Brown represented the government of Haiti under the dictatorship of Jean Claude Duvalier.
According to lobbying disclosure forms filed with Congress, Black, Manafort, Stone & Kelly represents clients as diverse as Jonas Savimbi and the UNITA rebels in Angola, the troubled government of Kenyan President Daniel arap Moi, Donald Trump, Johnson & Johnson, the Tobacco Institute and, until recently, the government of Zaire.
Several of these clients have interests that could become of special concern to the White House. A spokesman for the Tobacco Institute, for example, said the trade association is watching the budget negotiations closely and is prepared to object if increased cigarette taxes become part of a deficit reduction package negotiated between Congress and the White House.
The Bush administration supports the anti-government UNITA rebels in Angola who, according to U.S. government sources, receive about $50 million annually in covert U.S. aid. Last year, Black, Manafort, Stone & Kelly stirred controversy by drafting a letter to Attorney General Dick Thornburgh, later sent and signed by Sen. Orrin G. Hatch (R-Utah), that asked for an investigation into the activities of the TransAfrica lobbying group and its chief spokesman, Randall Robinson, for their support of "the Marxist regime in Angola."
Hatch later repudiated the letter, but not before both TransAfrica and the Congressional Black Caucus protested an activity by the lobbying firm that appeared to run counter to Atwater's aggressive efforts to recruit more blacks to the GOP.
Black said there will be no conflict on these and other issues between his business and political interests because he has promised White House Chief of Staff John H. Sununu that he will not personally lobby on behalf of any of the firm's clients while he acts as official party spokesman.
This promise, however, does not extend to other members of his firm, including Manafort, Roger Stone and former Democratic National Committee finance chairman Peter Kelly.
"I'm not working for the White House," Black said in an interview. "There's a big difference between being Lee's spokesman and being a spokesman for the White House." Atwater, who is also a member of the political arm of Black's firm, became a "passive partner" when he took the RNC post early last year. He is listed in corporate documents as a partner but receives none of the firm's earnings. Black remains an active partner with a full financial stake in the firm. A DNC spokesman described Brown as an "inactive" partner in his law firm.
Black said he is unperturbed about the activities of HUD special prosecutor Arlin M. Adams, who has issued a blizzard of document subpoenas to lawyers and other persons who were named in the HUD inquiry. Sources said a document subpoena was delivered to Black's firm, but Black declined to discuss details of the inquiry.
To a large extent, Manafort's testimony describing how he and other members of the firm persuaded New Jersey officials to apply for HUD funding for a project local residents did not want provided a neat framework for the subcommittee's investigations, which were uncovering more evidence of government manipulation than of outright illegality.
But Black said his firm has been largely unaffected by any fallout from the HUD scandals and has not lost a single client because of it.
If the HUD scandal's worst times have passed, it will not be the first time Black's fortunes have rebounded from adversity. In 1986, four of the candidates whose campaigns he ran -- including former senator Paula Hawkins (R-Fla.) -- were defeated in general election contests. In 1988, he took over the Kemp presidential campaign, which ended after Bush trounced Kemp on Super Tuesday.
Black said yesterday that his business interests would keep him from formally assuming the RNC chairmanship. But with what he describes as his personal "access to just about anybody in the government," Black is expected to guide the GOP through the political shoals at least through the November elections.
"He's doing this to help Lee, first and foremost," said RNC chief of staff Mary Matalin. "If there was anything counterproductive in it, he would not have done it. He really is the smartest guy of all of us."
Staff researcher Bruce Brown contributed to this report.