Texan's lobbying success becomes liability for McCainEx-Congressman Loeffler among staffers who resign over conflicts of interest
By BENNETT ROTH
Copyright 2008 Houston Chronicle Washington Bureau
May 20, 2008
WASHINGTON — In the years since George W. Bush moved into the White House, former Texas Congressman Tom Loeffler has parlayed top-drawer political ties into a lucrative lobbying practice that has reaped more than $32 million in business.
But in the past few days Loeffler, a fundraiser for the presumptive Republican nominee, John McCain, has learned that a lucrative lobbying career can be a double-edged sword.
Spokesmen for McCain said the Arizona senator moved to purge his campaign organization of lobbyists who presented potential conflicts of interest. Loeffler resigned as McCain's national finance co-chairman.
Haunted by success
Loeffler, a longtime friend of the candidate, became the fifth campaign official to lose his job in the past week after McCain implemented a policy that bars full-time staffers from lobbying. The new policy also requires volunteers such as Loeffler to disclose whether they are registered lobbyists or lobby on behalf of foreign entities.
For Loeffler, whose firm represented such high profile clients as the government of Saudi Arabia, the appearance of such conflicts proved politically radioactive for McCain, who has championed lobbying reform and campaign-finance reform.
"I think it is ironic that his success has come back to haunt (Loeffler)," said Craig McDonald, the director of Texans for Public Justice, a liberal group that tracks political money in the state. But while Loeffler has been deprived of an official campaign role, McDonald said, the Texan could continue to help his friend. "Taking his title away doesn't mean he still can't work the phones," he said.
In explaining Loeffler's departure, McCain campaign spokesman Jeff Sadosky said the campaign "put forward a very strict policy and all personnel are required to be in compliance with it."
"Many fine people may have a conflict that is not reconcilable," said Sadosky in an email statement. He did not specify what, if any, conflict of interest that Loeffler had, adding, "We will have no further comment on staff."
Loeffler, who did not respond to e-mail or phone calls to his San Antonio office seeking comment, served in Congress from 1978 to 1986. He served as Bush's national finance co-chairman during the 2000 campaign and set up his lobbying operation in Washington the next year.
Loeffler's lobbying business grew rapidly from $2.8 million in fees in 2001 to $5.8 million in 2003, according to lobbying disclosure records analyzed by the Center for Responsive Politics. Last year, the Loeffler Group reported $4.8 million in federal lobbying business.
His clients have included such local entities as the Port of Houston, which paid the firm $120,000 in 2006.
The Loeffler Group faced scrutiny early this year because it had lobbied for European Aeronautic Defence and Space Co., which was part of a consortium awarded a contract to provide air-refueling tankers for the Air Force. The contract caused an uproar because it was awarded to a foreign company over domestically based Boeing Co. McCain helped kill a tanker contract to Boeing in 2004 and uncover criminal wrongdoing by senior Boeing executives and Air Force officials.
Must 'fall on his sword'
Last week, Loeffler faced renewed criticism after Newsweek reported that the lobbyist admitted meeting with McCain and the Saudi ambassador to "discuss U.S.-Kingdom of Saudi Arabia relations." Saudi Arabia paid Loeffler's firm $15 million, the magazine said.
McCain's friendship with Loeffler dates back to when they both served in Congress in the early 1980s. The two men also were strong supporters of former Texas GOP Sen. Phil Gramm when he ran unsuccessfully for president in 1996. Loeffler served as the national finance chairman for Gramm's presidential effort.
When the issue of Loeffler's lobbying came up last year, McCain brushed aside those concerns and told reporters the Texan was "very highly regarded. I don't have to recite his credentials."
Bruce Buchanan, a government professor at the University of Texas, said McCain can't afford to tarnish his reputation.
"It is difficult for him to hang onto what makes him attractive, which is his reputation for integrity and non-lobbyist operations, while constantly having to field questions about these ties to lobbyists," he said. "The bottom line here is (McCain) has to pay a price, and Mr. Loeffler has to fall on his sword."