Is Wall Street’s Grip on the Transition Slipping?
Newsletter 46: How corporate America could still come out on top when the dust settles
When it comes to presidential transitions, corporate America is unaccustomed to serious challengers. The transition environment -- out of the spotlight and cloaked in secrecy -- is practically made for their brand of palm greasing and favor trading to thrive. But this time around, a new set of contenders is tearing down the doors to these smoke-filled rooms and demanding a say over the shape and composition of the next administration. At first, the corporate titans brushed them off as a nuisance but, increasingly, they’ve come to see them as a real threat. How worried should they be?
2020 (and potentially 2021):
These challengers are clearly making themselves heard in an unprecedented way. On Wednesday, 48 groups focused on a range of issues including finance, civil rights, monopoly, environment, and national security delivered a letter to the presidential candidates asking that they pledge not to appoint people from regulated industries into positions with power over those sectors. The letter, co-organized by Revolving Door Project and Demand Progress, detailed why such a commitment is necessary following Trump’s particularly breathtaking corruption and the decades of soft corruption that has quietly, but steadily eroded public trust in government.
Many, however, are not just asking nicely for the campaign’s cooperation but making any attempt to ignore them more painful. Over the past few weeks many of the revolving door figures in Biden’s inner circle have come under a rather unflattering spotlight. Ken Salazar, President Obama’s first Interior Secretary and now-Biden adviser, for instance, was the subject of a profile in HuffPost last week. After the Obama-Biden administration, Salazar took up a position at WilmerHale where he was a fossil fuel lobbyist in all but official registration. As our Jeff Hauser noted for the piece, “just because Salazar is powerful enough, and our ethics laws so pathetic, that he has avoided triggering ethics rules and norms around ‘registered lobbyists’ does not mean his access peddling is healthy.” If Salazar is put anywhere near climate policy, activists and members of the public would be right to worry that Biden’s ambitious climate agenda would go nowhere.
Salazar’s not the only one feeling the heat. Biden’s long-time adviser Steve Ricchetti came under the New York Times’ microscope over the weekend. Ricchetti has a long revolving door wrap and an even longer list of troubling lobbying clients, from AT&T and General Motors, to Pfizer and Eli Lilly. As the New York Times notes, “Ricchetti...personifies the prevalence of influence industry veterans in Mr. Biden’s orbit that concerns progressives.”
But just because these and other figures are becoming more controversial does not mean that they will not have a place in a potential Biden administration. Biden’s team may well risk the political consequences to muscle these figures through over public dissent. Or, it may work to keep the most controversial figures out of the public eye for as long as possible, allowing them to skirt public scrutiny.
One can’t help but wonder if Biden’s secretive, sprawling advisory teams are not designed to accomplish the latter. As a piece in Foreign Policy noted over the weekend, around 1000 people are weighing in on Biden’s approach to foreign affairs, with access to the inner policy circle mediated by a handful of working group chairs. Members are busily writing memos, the ultimate destination for which is unclear. With such a nebulous apparatus, it’s hard to tell who holds the real power and influence and who is being brought into the fold to lessen potential dissent.
This arrangement is not unique to the foreign policy advisory structure. A similar arrangement has reportedly developed for economic policy advising (and, one can assume, for other areas as well). In some cases, the different universes are given nominal control over the same turf, like trade policy. As the American Prospect reported yesterday, both a more conservative foreign policy team and a more progressive economic team are advising Biden on trade. But there can be only one trade policy and one set of trade policy officials, so which is it going to be?
All of this underlines the fact that this question will not be settled anytime soon. Progressives and good government groups are going to need to stay on their toes for a long time if they hope to build a new sort of executive branch in Trump’s wake. If they let their guard down, a whole host of traditional, revolving door figures will be waiting to swoop in.
They’re already busy laying the groundwork for their re-emergence by insisting that they are the only figures with the “experience” and knowledge of “the mechanics of Washington” that will be necessary to put the federal government back together again. It’s worth interrogating that claim because it’s likely to surface often in the coming months.
There is no doubt that many of these figures are indeed expert “mechanics,” but their work, sometimes stretching over decades, has been focused on getting the machinery to work for corporate America, not the broader good. This sort of experience - greasing the wheels of official Washington to earn favors for wealthy benefactors - should be looked on with suspicion.
To build a government that works for all people, we need to look to a crop of people with more relevant experience advancing projects that serve the public interest. Beware of those who tell you that this will require a tradeoff when it comes to expertise. Look no further than the likes of Anthony Fauci - a man who has dedicated his life and long career to advancing the public interest - to know that there are lots of people who fit the bill. And for more suggestions you can look at pieces like this one that we published in January, in addition to Data for Progress’ Progressive Cabinet Project.
The good news is, if these figures are successfully sidelined, there is really quite a lot that the Biden administration could do using executive power alone. For the American Prospect last week, our Max Moran catalogued all of the 277 planks from the Biden-Sanders Unity Task Forces that fall under that category.
Congressional Oversight
In the last week, House Democrats have issued not one, not two but five subpoenas to Trump administration officials. The House Foreign Affairs Committee followed through on a threat to subpoena the State Department for documents the Department provided to the Senate Foreign Relations Committee in connection with its probe into Joe Biden. It also joined the Oversight and Government Affairs Committee in issuing subpoenas to four State Department officials relating to the firing of its Inspector General Steve Linick.
Meanwhile, the Oversight Committee has requested testimony from the new Postmaster General, Louis DeJoy. As reports of new directives and severe delays emerge and concerns over the system’s ability to support a huge increase in vote-by-mail rise, this hearing could not be more necessary. And it is imperative that the committee does not abandon its zeal should DeJoy display any of the Trump administration’s usual recalcitrance and refuse to testify. Now that Chairwoman Maloney has gotten a taste for subpoenas, perhaps she’ll be willing to deploy them more liberally?
And, of course, we would be remiss not to note last week’s oversight high note: the House Judiciary Antitrust Subcommittee’s hearing with Big Tech CEOs. As David Dayen wrote in the American Prospect, the whole affair was reminiscent of “a time when Congress had the institutional resources and the personal gumption (in an age before the floodgates of Big Money opened) to challenge power.”
With all of this activity, what is a small project that has spent the last year and a half obsessing over the lack of oversight supposed to do? Why, call for even more, of course! While we’re happy to see this movement, it’s still far from enough (especially when one considers the backlog). Add to the list this week, Trump’s latest “end run” around the Senate’s advice and consent role.
But, as the Tech hearing’s success showed, Congress should not limit itself to challenging the Trump administration. It’s long past time they confronted the titans of corporate America too. As our Eleanor Eagan explains in the Prospect, “Confrontations with the country’s ever more powerful corporate giants not only make for good policy but also good politics. If House Democrats are serious about either, they will fill the coming months with such clashes.”
Independent Agencies
Given Senate Republicans’ lethargy in stimulus negotiations last month, it might come as a surprise that they kept relatively busy advancing nominations to independent agency boards throughout July. Nominees Marvin Kaplan and Lauren McFerran were confirmed to the National Labor Relations Boards (NLRB) late last month (leaving 0 Republican and 1 Democratic vacancies) and those for the Securities and Exchange Commission (SEC) and the National Credit Union Administration (NCUA) appeared for their hearing before the Senate Banking Committee. We can also likely expect Trump’s nominees to the Federal Reserve - Judy Shelton and Christopher Waller - to be confirmed soon.
New confirmations led the number of vacant and expired seats to fall slightly last month, to 74 total (33 expired and 41 vacant). Trump put forward four new nominations, for seats on the Defense Nuclear Facilities Safety Board (DNFSB), the Federal Energy Regulatory Commission (FERC), and the Surface Transportation Board (STB). Total nominations continue to reflect a partisan imbalance with only 8 nominations having been advanced for 28 vacant or expired Democratic seats versus 18 nominations for 32 Republicans ones.
Want more? Check out some of the pieces that we have published or contributed research or thoughts to in the last week:
The Future of Trust-Busting is in Joe Biden’s Hands
The 277 Policies for Which Biden Need Not Ask Permission
Today's Congressional Hearing Will Test Big Tech's Simplest Algorithm: If An Ex-Regulator, Then Hire
The Big Tech Hearings Could Be a Model for Corporate Accountability
Building a Federal Workforce that Works for All
House Must Grill Tech CEOs About Hiring Through The Revolving Door
To Rebuild Public Trust, Close the Revolving Door
Revolving Door Project Comments on OCC's Proposed Rulemaking on Digital Activities
Left wing to Biden: Keep industry captains off transition team
Biden Faces Pressure From Left Over Influence Industry Ties
Wall Street Is Torn on Whether a Biden Win Would Bring Joy or Misery
Biden's Weak Link On Energy And Ethics Is An Ex-Obama Official With Deep Fossil Fuel Ties
Dozens of Groups Urge Biden to Stand Against Corporate Conflicts of Interest
Politico Morning Tech, 7/31/20