Commerce, Treasury funds helped boost GOP campaigns

McClatchy NewspapersAugust 17, 2007 

US NEWS NEWBILL 2 KRT

CHUCK KENNEDY — Chuck Kennedy/MCT

WASHINGTON — Top Commerce and Treasury Departments officials appeared with Republican candidates and doled out millions in federal money in battleground congressional districts and states after receiving White House political briefings detailing GOP election strategy.

Political appointees in the Treasury Department received at least 10 political briefings from July 2001 to August 2006, officials familiar with the meetings said. Their counterparts at the Commerce Department received at least four briefings — all in the election years of 2002, 2004 and 2006.

The House Oversight Committee is investigating whether the White House's political briefings to at least 15 agencies, including to the Justice Department, the General Services Administration and the State Department, violated a ban on the use of government resources for campaign activities.

Under the Hatch Act, Cabinet members are permitted to attend political briefings and appear with members of Congress. But Cabinet members and other political appointees aren't permitted to spend taxpayer money with the aim of benefiting candidates.

During the briefings at Treasury and Commerce, then-Bush administration political director Ken Mehlman and other White House aides detailed competitive congressional districts, battleground election states and key media markets and outlined GOP strategy for getting out the vote.

Commerce and Treasury political appointees later made numerous public appearances and grant announcements that often correlated with GOP interests, according to a review of the events by McClatchy Newspapers. The pattern raises the possibility that the events were arranged with the White House's political guidance in mind.

The briefings are part of the legacy of White House political adviser Karl Rove, who announced this week that he's stepping down at the end of the month to spend more time with his family. Despite Rove's departure, investigations into the briefings are expected to continue.

One congressional aide, who asked to remain anonymous, said the investigation was revealing "a number of remarkable coincidences" similar to how Treasury and Commerce events appeared to coincide with the strategy in the political briefings. However, it remains to be seen whether the subsequent department actions were intentional, said the aide, who asked not to be named because the investigation is ongoing.

As part of the probe, committee investigators found that White House drug czar John Walters took 20 trips at taxpayers' expense in 2006 to appear with Republican congressional candidates.

In a separate investigation, the independent Office of Special Counsel concluded that GSA Administrator Lurita Alexis Doan violated the Hatch Act, which limits the political activities of government employees. Witnesses told investigators that Doan asked at the end of one political briefing in January 2007 what her agency could do to help GOP candidates. Doan has said she doesn't recall that remark.

Violations of the Hatch Act are treated as administrative, not criminal, matters, and punishment for violations ranges from suspension to termination. The administration has not taken any action against Doan.

Even so, the Hatch Act "is an important statute and it needs to be enforced," said James Mitchell, spokesman for the Office of Special Counsel. "One of the effects we hope our investigations will have is to deter violations during the upcoming election cycle."

In the months leading up to the 2002 election, then-Commerce Secretary Don Evans, Bush's former campaign finance chairman, made eight appearances or announcements with Republican incumbents in districts deemed by White House aides either as competitive districts or battleground presidential states.

During the stops, he doled out millions of dollars in grants, including in two public announcements with Rep. Heather Wilson, a New Mexico Republican in a competitive district.

Republicans ultimately regained control of the Senate and expanded their majority in the House of Representatives in the 2002 elections.

In 2004, Evans and his aides significantly scaled back appearances with candidates, but an assistant treasury secretary returned to New Mexico to announce with Republicans Sen. Pete Domenici and Rep. Steve Pierce the release of $2.5 million in economic development funds.

Evans, who now heads the Financial Services Forum, a trade association for financiers, declined comment, a Forum spokesman said.

In 2006, Evans' successor, Carlos Gutierrez, and his aides also made public announcements with several Republican congressional incumbents, including in the battleground states of Missouri, Pennsylvania and New Mexico. Weeks before the 2006 election, Gutierrez and Congresswoman Wilson announced $3.45 million in grants for Albuquerque organizations. Also in the weeks before the election, a deputy secretary and Republican Sen. Rick Santorum announced that the department would be investing $2.25 million in Philadelphia.

The same year, then-Treasury Secretary John Snow and Santorum announced an award of millions in tax credits to Pennsylvania organizations. Santorum later lost his seat.

Snow and his aides also made appearances in 2006 with Republican incumbents or doled out grants in Virginia, Iowa and Ohio, states seen as crucial to the GOP retaining control of Congress.

Bush's first treasury secretary, Paul O'Neill, stuck mainly to giving speeches praising President Bush's economic policies rather than appearing with candidates. O'Neill was unceremoniously dumped after disagreeing repeatedly with the White House.

Current Treasury Secretary Henry Paulson Jr. was sworn in shortly before the 2006 elections. He and his aides have made few grant announcements.

Administration officials denied that any Treasury and Commerce events were orchestrated to help the Republican Party win elections. The officials said White House aides who briefed the departments were careful not to encourage the appointees to act on behalf of the Republican Party on government time.

Commerce Department spokesman Dan Nelson described the meetings as merely "informational."

"They were not a call to action," he said.

Nelson said grants are awarded after a competitive process and aren't selected based on political considerations.

Ted Kassinger, the Commerce Department's former general counsel and a deputy secretary in the Bush administration, said the department was especially careful about avoiding the appearance of political favoritism during Evans' tenure because of the former secretary's close ties to President Bush.

Kassinger, who left in 2005, said the department turned down several requests from political candidates to make appearances because they seemed to be campaign events.

"It was certainly a concern of mine that the work in the department be separated from campaign activities," he said. "At the top level there was never a discussion of 'What can you do to help these guys?'"

One former political appointee who attended a briefing said for all the hoopla over the briefings, he wasn't impressed with them at the time.

"It wasn't rocket science," said the appointee, who asked to remain anonymous because he didn't want to be publicly linked to the controversy. "It's like, 'Yeah, no kidding. We know.'

But John D. "Jerry" Hawke, who served as Treasury undersecretary for domestic finance in the Clinton administration, said the campaign-style briefings for Treasury appointees were unusual.

"Nothing remotely like that happened," during the Clinton administration, Hawke said. "I never experienced anything like that. The notion that the White House would be holding meetings with Treasury appointees just didn't fit."

McClatchy Newspapers 2007

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