Why doesn’t William Daley violate Obama’s lobbyist ban?


Why doesn’t the appointment of William Daley violate the Obama administration’s ban on lobbyists in the administration? Even though Daley was never registered as a lobbyist, his past work suggests that much of what he did involved lobbying or overseeing lobbying.

James Downie, writing at The New Republic, points to what he terms William Daley’s “seediest exploit.” When SBC hired Daley they were facing a wall of regulations and opposition from Democratic pols from the federal to the state level. The Daley hire was meant to alleviate some of this pressure by using his knowledge of government, and government officials, to help push their legislative and regulatory agenda. According to Downie:

In Daley, SBC got the political clout it were looking for. Daley’s first assignment was to lobby Capitol Hill to pass the Tauzin-Dingell bill, which would have strengthened local phone companies’ monopolies. His biggest victory, not surprisingly, came in Illinois, where, according to Crain’s Chicago Business, Daley was SBC’s “chief lobbyist” on a bill that would let the company “start charging its rivals nearly twice as much” for using its network. (Daley has long maintained that he’s never been a lobbyist.) The measure was opposed by Democratic politicians locally (including the Democratic lieutenant governor and attorney general) and nationally: John Conyers labeled the bill “a national embarrassment. The Democratic Party is supposed to stand for consumers.” Yet SBC’s Daley-led lobbying, which included $200,000 in contributions to then-governor Rod Blagojevich’s campaign and inauguration committees, led to Blagojevich signing the bill into law just four days after it was first introduced in the state legislature. Crain’s called the speed “unheard of for non-emergency legislation. … Illinois consumers and small businesses will again be at the mercy of a local phone service monopoly.”

Bill Daley has repeatedly stated that he has never been a lobbyist. While he may never have registered under the Lobbying Disclosure Act–Daley was registered as a foreign lobbyist under the Foreign Agents Registration Act–his private sector roles have almost certainly involved the direction of lobbying efforts.

Downie’s piece shows how Daley was involved in lobbying efforts at SBC Communications and a New York Times article out today indicates that Daley had a hand in crafting JPMorgan Chase’s lobbying team in Washington. According to the Times:

Mr. Daley was never registered as a lobbyist for Chase, but he played a role in hiring and was the direct supervisor of Peter L. Scher, another former Clinton administration official, who runs the bank’s lobbying shop in Washington. Mr. Daley also served as the bank’s chief liaison with the White House, frequently consulting with Valerie Jarrett, a senior adviser to Mr. Obama, and Rahm Emanuel, whom he is replacing.

Daley hired and was the direct supervisor of the man who ran the bank’s lobbying shop. He also was in frequent contact with the President’s lead on outreach to the business community, Jarrett, and the former chief of staff. How many congressional offices was he in contact with as well?

This marks the absurdity of the current lobbying disclosure regime: those who spend less than 20 percent of their professional time lobbying do not have to register. (See Lisa Rosenberg’s post on this very subject.) A contact from Bill Daley about a policy is a lobbying contact and likely carries a lot of weight in certain offices across Washington. These contacts do not, allegedly, amount to enough for him to register as a lobbyist. However, his role at JPMorgan Chase was to supervise the lobbying team in Washington. It seems contradictory that the man in charge of the lobbying operation could not be a lobbyist too.

One of President Obama’s first actions upon taking office was to ban lobbyists from his administration, with some exceptions. Waivers have been granted for a few individuals, although not too many. The ban was seemingly applied arbitrarily. A particular galling example was the rejection of Tom Malinowski, the Washington director for Human Rights Watch, a public interest group opposing human rights violations, for a position at the State Department because he was a registered lobbyist. Malinowski, however, was lobbying against human rights violations, not for a company’s bottom line or an individual’s claims.

This instance is both another example of the arbitrary application of this supposed lobbying ban and another example of the need to regulate non-lobbyist lobbyists. While Daley may not be a registered lobbyist, an important part of his work in the private sector was indistinguishable from the work of a Washington lobbyist.