As the Republican gubernatorial nominee in Virginia, Ed Gillespie has vowed to make health care more affordable and accessible, pledging at a recent debate to “incentivize greater competition in the insurance marketplace.”
But as a private consultant, Gillespie advised Anthem, the nation’s second-largest insurance company, as it pursued a merger last year with Cigna, the No. 3 insurer. Virginia insurance regulators said the merger would raise costs and reduce competition, and a federal judge cited the same concerns when she later blocked the deal.
Anthem is among four companies with extensive interests in Virginia that paid Gillespie between $50,000 and $250,000 last year for consulting services. Anthem, AT&T, Bank of America and Microsoft contract directly with the state government, do millions of dollars of business in Virginia, and lobby to influence state laws and policies. All but Anthem have hired Gillespie on and off for more than a decade, dating to his time as co-founder of one of the most successful lobbying firms in Washington.
If he is elected governor, Gillespie would face decisions in which the public’s interests may conflict with the interests of companies that have paid his firms millions of dollars collectively for lobbying and consulting services — and that could hire him again.
“That’s an issue for him to overcome, and it’s a nonpartisan concern for both liberals and conservatives,” said Tom Fitton, president of Judicial Watch, a conservative government watchdog group. “The concern is that politicians are more concerned about the payout on K Street that they may get when they leave office as opposed to the public’s interest when they are in office.”
Gillespie’s opponent in the race, Lt. Gov. Ralph Northam, also has financial ties to several companies active in the state, through his stock portfolio. Virginia’s conflict-of-interest laws generally allow lawmakers and state officials to act on bills affecting companies in which they own stock.
Gillespie, who declined an interview with The Washington Post, closed his consulting firm, Ed Gillespie Strategies, shortly before launching his campaign in January. The Republican nominee has no current financial interests in the companies, such as stock holdings, and he and his wife would put their personal investments in a blind trust if elected, campaign spokesman David Abrams said.
“As governor, Ed will be an honest, ethical, principled, hard-working, faithful servant-leader worthy of Virginia,” Abrams said, repeating a phrase that Gillespie and his staff have used repeatedly throughout the campaign.
Abrams noted that Gillespie voluntarily released the names of the clients he advised last year. Virginia’s financial disclosure form requires only that candidates list the types of businesses and the range of compensation. “Ed went above and beyond,” Abrams said.
One year after President Trump won election, in part by railing against influence peddlers and vowing to upend the status quo, Gillespie is trying to ride the anti-establishment tide as well as a former Republican National Committee chairman can. His campaign biography omits his lobbying work and tells the up-from-the-bootstraps story of the son of an Irish immigrant grocery store owner who rose to become a top adviser to President George W. Bush.
When Gillespie was tapped to serve in the White House in 2007, his lobbying firm, Quinn Gillespie & Associates, represented more than 100 clients, including some of the nation’s biggest companies and trade groups, according to a financial disclosure form. The firm reported $17.2 million in revenue from federal lobbying in 2016, according to public records.
It was paid more than $3.2 million from 2001 to 2007 by three of the companies he consulted for last year — AT&T, Bank of America and Microsoft — according to public records. Gillespie also consulted for those companies before his 2014 Senate campaign, according to his federal candidate disclosure form.
A gubernatorial bid by a former lobbyist is not without precedent. Virginia’s current governor, Terry McAuliffe (D), was previously the managing partner of a law firm with a lobbying practice, although he did not personally lobby. Haley Barbour, a Republican who founded a major lobbying firm that employed Gillespie early in his lobbying career, served as governor of Mississippi from 2004 to 2012.
Gillespie, whose reputation as a Washington insider could be a liability in this election cycle, has proposed an ethics and campaign finance platform that includes provisions opposed by lawmakers in his own party. His plan would ban personal use of campaign funds, slow the “revolving door” by prohibiting former state employees from lobbying their prior agencies for two years, and require more frequent disclosures of conflicts of interest.
Critics, however, pointed to Gillespie’s own experience with the revolving door — he worked for then-Rep. Dick Armey (R-Tex.) from 1985 to 1996 and did three stints in the Bush administration, and advised private clients as a lobbyist or consultant in between those jobs and after leaving the White House. Part of his firm’s pitch was that he could leverage his relationships with those in power.
In 2002, Quinn Gillespie posted notable press clippings on its website, including one that said Gillespie “advises the White House, which puts him in a perfect position to help his clients.” Also cited was this quote from a Washington Post story: “Ed Gillespie has emerged as a one-stop power broker. He advises top White House officials, works for GOP campaigns, lobbies for major corporations and opines on political talk shows.”
Gillespie’s private-sector work has fueled frequent Democratic attacks since early 2014, when he first sought to make the leap from political operative to elected official. Gillespie came close to unseating Sen. Mark R. Warner (D-Va.) that year.
“I served eight years in the U.S. Army, I showed up for this country,” Northam said at a debate Oct. 10. “You’ve been a K Street lobbyist in Washington. The only time you show up is when you get paid.”
Gillespie didn’t flinch. “I did show up for my clients, and I was effective,” he said.
In a reprise of a Warner attack ad, Northam dubs Gillespie “Enron Ed” in a television spot that tries to yoke him to the energy company that went bankrupt in 2001 amid a massive accounting fraud. Gillespie was among four lobbyists registered to represent the company that year, and he cut ties before the bankruptcy filing. He has said he had no knowledge of Enron’s accounting tactics.
Northam has stock holdings of between $5,001 and $50,000 each in AT&T, Bank of America and Dominion Energy, all of which do business in the state, according to his candidate financial disclosure form. Environmentalists have accused Northam of putting Domion’s interests ahead of those of his constituents. Northam has denied the claim and has pledged to put his investments in a blind trust if he is elected.
Gillespie also has faced criticism from a government watchdog group for declining to elaborate on the consulting work he did in 2016 with two conglomerates, DCI Group and Brunswick Group. Brunswick works in 14 countries and employs “experts in every industry,” according to its website, while DCI claims to be “widely acknowledged as the deepest and most sophisticated political network in the public affairs industry.” State law does not require Gillespie to disclose clients unless they do business in Virginia.
“What Gillespie has disclosed only takes you part of the way, even though it satisfies the law,” said Dale Eisman, a senior writer for the government watchdog group Common Cause who lives in Springfield, Va. “We still don’t know everyone whom he might be beholden to and what their connections are to Virginia.”
In voluntarily disclosing his clients from last year, Gillespie said he advised Anthem and AT&T on proposed mergers and helped Microsoft and Bank of America with “reputation management and communications strategy.”
All four companies or their top executives have contributed to the Gillespie campaign or to a committee he controls, according to the Virginia Public Access Project (VPAP), and they have ongoing interests in the state. The governor can directly affect those vast interests when making policy, signing legislation and recruiting businesses to the state.
The proposed $54 billion merger last year of Anthem, the state’s largest insurer, and Cigna would have created the nation’s largest insurance company. Virginia insurance regulators opposed the merger, citing “the potential of harm to policyholders as well as the general public.”
Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia blocked the deal in February, saying that “it is likely to result in higher prices and that it will have other anticompetitive effects.”
In August, Anthem announced it would pull out of the Affordable Care Act’s exchange in Virginia amid uncertainty over the future of such marketplaces and pronouncements by President Trump that they were about to fail.
McAuliffe was involved in an effort to persuade Anthem to stay. When the company reversed its decision, he tweeted: “Just got a call from @AnthemInc. They are staying in Virginia!” Anthem said its decision to remain in parts of the state preserved insurance for up to 70,000 Virginians.
AT&T lobbied on six 2016 bills in Virginia — legislation related to cellular use while driving, telecommunications towers, taxes and workplace safety, according to VPAP. In July, Virginia became the first state to announce participation in a nationwide public safety broadband network, created by AT&T with partners, to allow public safety officials to communicate more reliably in a crisis.
Last month, McAuliffe attended an event celebrating an underwater data cable built in part by Microsoft that stretches from Virginia to Spain. Microsoft also operates a data center in Mecklenburg County that employs more than 250 people. The data center’s latest expansion received a $500,000 grant from a state business incentive program, McAuliffe announced.
Microsoft lobbied on Virginia bills related to tax breaks and high school graduation requirements last year, according to VPAP.
Bank of America also has a large presence in Virginia, with about 133 branches. It bills in Richmond last year that dealt with mortgage applications and credit unions, records show. Bank of America was one of the biggest beneficiaries of the Troubled Asset Relief Program, the government bailout that Gillespie helped push when he was in the White House after previously working as a lobbyist for the bank.
Given the myriad ways a governor can affect the fortunes of large companies doing business in the state, voters should consider Gillespie’s ties with his former clients, said Eisman of Common Cause.
“The candidate knows who helped him get there and helped him make his fortune,” he said. “Voters need to ask what steps the candidate would take to ensure his decisions in public office are based on the merits and not those past relationships.”
This is the second of two stories examining how Virginia’s gubernatorial candidates could face challenges leading the state because of their financial dealings with companies that have extensive interests there. Yesterday: Ralph Northam’s stock holdings.
Andrew Ba Tran and Alice Crites contributed to this report.