Case in Point – A Really BIG Revolving Door!

McCain seems to be delivering a promise of more of the same.

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Brokering Power In Business and Politics
Buyout Firm Founder Fred Malek's Career Spans Nixon to McCain
By Michael S. Rosenwald
Washington Post Staff Writer
Monday, April 21, 2008; D01
Three guys in suits came strolling down the hallway. Fred Malek, chairman and senior adviser of a District buyout group, waited for them in his corner office. One of the men was Scott Rued, a managing partner at Malek's firm. He was with an investment banker, who was representing the third man, an owner of a logistics company that Rued coveted.
The company's owner looked tense. Perhaps he should have been. He had started his firm in his living room, and now he was wrestling with giving it up to some men he barely knew. A few of months ago, Rued asked Malek to have breakfast with the owner to smooth the way for the man to attend the meeting that was about to happen: the initial negotiations to merge the company into one of Malek's.
Malek, by his admission, is not entirely warm and fuzzy, but he is likable and has a knack for winning people's trust. He could relax a mouse who was about to be eaten by a cat. In this case, he created a clubby, insider atmosphere, showing off photos from a lifetime of moving in and out of power. There's Malek with his former executive assistant, Gen. Colin Powell. There's Malek with his ex-boss, President Richard Nixon. There's Malek with former president Bush, after parachuting out a plane to celebrate Bush's 80th birthday. "Did Bush jump, too?" Rued asked. "Hell yeah," Malek said.
More small talk ensued. Then Rued and the banker went off to another room to start their talks, which was emblematic of a reality that Malek seems perfectly comfortable with these days: He is no longer the man making the deals. At 71, he is the elder statesman -- elder capitalist -- of Thayer Hidden Creek. Following the restructuring of the firm several years ago after some costly missteps, Malek has firmly stepped away from the day-to-day operations, functioning as an adviser, a listening post, an emissary of deals.
"He opens doors, and he knows which ones should be opened," said Norman Augustine, a former chief executive of Lockheed Martin who sits on Thayer's board.
In the weeks ahead, Malek will temporarily retreat further from Thayer. He is slipping back into the political world, where he was once, in Powell's words, Nixon's disciplinarian and later the campaign chairman for President George H.W. Bush. He has been drawn back by an affection for Sen. John McCain (Ariz.), a fellow Vietnam War veteran with unpopular positions in the Republican party who Malek says reminds him of one of his favorite credos, which he learned at West Point: Have the courage to choose the harder right vs. the easier wrong.
Malek is a co-chairman of McCain's campaign finance committee, an unusual position for him because he previously has served in more strategic roles. But it's a job that fits Malek at this time in his life, in that he has come to know a lot of people with a lot of money. Asked why he thought Malek will be successful raising money, Bill Marriott, Malek's boss when he oversaw Marriott's hotels, said: "He has an amazing Rolodex. And when he calls people, they pick up the phone."
After all these years, and despite some embarrassing controversies and a disheartening end in his bid to buy the Washington Nationals, Malek remains one of Washington's ultimate insiders. The other night he had President Bush -- the one living in the White House -- over for a fundraising dinner at his palatial home overlooking the Potomac River in McLean, where he lives with his wife of 46 years, Marlene Malek. He is not a billionaire, but he has his own plane and a house in Aspen. He has certainly come a long way from growing up the son of a Chicago beer delivery man -- a Democrat, no less.
"My parents taught me to achieve," Malek said, sitting on the couch in his living room. "And I found the wonderful gratification that comes from achievement. The motivation to achieve and the fulfillment of achievement gives me great satisfaction." His philosophy on work brings to mind his other favorite credo, from Bill Marriott: Success is never final.
Malek, who is wiry, fit and always well put together, graduated from West Point in 1959 and later was an airborne Army Ranger in Vietnam, completing a tour deep in the jungles. (His buyout firm and his hotel company are named after Brig. Gen. Sylvanus Thayer, known as the father of West Point.) After Vietnam, Malek got his MBA from Harvard Business School and eventually found his way into the Nixon administration, where he was a special assistant to the president and then deputy director of the Office of Management and Budget. One of Malek's key hires was Colin Powell.
"He had a reputation of -- I'll let you characterize it -- but within the bureaucracy he was the guy who the president looked to put discipline in the system," Powell said in an interview. "Fred was a disciplinarian. He was also seen as a political operative. That's a negative term nowadays. But it's a positive term. The president had an agenda and wanted to make sure it was being followed. OMB is the turnstile of government. Fred was very influential."
Malek was exceedingly loyal to Nixon. "I believed he was telling the truth until the very end," Malek said. And it was under Nixon that Malek made what he terms the biggest mistake of his life. At the president's order, he counted how many Jews worked in the Bureau of Labor Statistics. (Nixon was convinced that some Jewish employees of the agency weren't loyal.) Controversy surrounding his actions forced him to resign from Bush's campaign in 1988. Malek is remorseful about the episode and adamant that he is not an anti-Semite, just a guy who made a dumb mistake -- a very big dumb mistake. He sought counsel from -- and was later forgiven by -- some of the world's Jewish leaders, including Abraham Foxman, the director of the Anti-Defamation League.
"He has been very remorseful ever since," Powell said. "But it did make it difficult for him to get back into government."
Malek's private sector positions and the number of deals he has made in business are almost too long to list. He worked for McKinsey & Co. He led a buyout of Northwest Airlines and CB Richard Ellis. His longest stint at any company was 14 years at Marriott International starting in the 1970s, where he rose to become president of the company's hotel division. At Marriott, he became close with a junior executive named Lee Pillsbury, and the two later became partners in Thayer Lodging Group, an Annapolis company that owns more than a dozen hotels. Malek is still active in its day-to-day operations.
Pillsbury said that during their time at Marriott, Malek "had the most discipline of anyone I had ever met. His time management was legendary. He walked in to the office at 5 minutes to 8 and left at 5 minutes after 5, and everything was done and finished on time the way it was supposed to be."
Nearly everyone who has worked with Malek said the precision of his actions are legendary and border on the bizarre. "When Fred tells you that he will go to the bathroom at 10, it's not going to be 9:59 or 10:01. There is nothing too trivial for Fred to keep his word on," Pillsbury said.
That reputation seemed to connect the owner of the logistics company to Malek. After Rued and the investment banker chatted privately, the group made its way to a conference room not far from Malek's office. They sat at a long, shiny wooden table. Rued, the investment banker and the company's owner took off their jackets and loosened their ties. Malek stayed buttoned up, jacket on.
Rued made a presentation about how he saw the man's firm fitting into theirs. But the owner had questions. He had lots of questions. And he seemed hesitant, particularly about giving up total control. Malek said he understood how he felt: "It's like jumping out of an airplane." At one point, the man looked at Malek and said, "I want to do this with you." Malek asked what he meant. The man said he wanted to go around the country and make nice-nice with potential customers with Malek at his side. "I want you to be you, to do your thing" the man said. Again, he repeated, "I want to do this with you."
Malek said yes, he would help the owner build relationships with customers. "I do what I say I'm going to do," Malek added. "That's why I've been around so long."

Committee Probes Industry Influence on EPA Panels
By Suemedha Sood
The Washington Independent
Thursday 17 April 2008

Chemical trade investigation carries implications for children's health.
A congressional investigation is trying to determine whether ties between the chemical industry and the Environmental Protection Agency put children' health at risk. The House Energy and Commerce Committee is examining whether chemical companies influence EPA panels that review chemicals for safety. The committee's concern is that panels may be stacked with industry scientists who downplay the real risks of toxic substances.
The House committee is focusing on the American Chemistry Council, the main lobbying group for the chemical industry. This is a landmark investigation, says the Environmental Working Group, a non-partisan policy organization, because Congress doesn't usually put trade groups under the microscope.
(Matt Mahurin) But influence from industry could have significant consequences for children's health. Some chemicals under review have added risks for children and infants and, according to lawmakers and environmental advocates, industry scientists deny the need to regulate use of those chemicals. Recent EPA actions to weaken safety standards for children have left the relationship between industry and the government agency open to scrutiny.
The Energy and Commerce Committee's investigation is looking at several panels to find out whether industry bias played a role in weakening standards - especially dangerous to children, who are more vulnerable to toxic exposure. In the wake of this investigation, the EPA has convened yet another panel with scientists who have industry ties - a panel that is considering easing safeguards that protect children from carcinogens.
The congressional committee's investigation was triggered by an EPA review panel on the fire retardant decabromodiphenyl ether, or deca, used in television casings, computer monitors and other electronics, which can be particularly harmful to children and infants. Reps. John D. Dingell (D-Mich.), chairman of the Energy and Commerce Committee, and Bart Stupak (D-Mich.), chairman of the Oversight and Investigations Subcommittee first took action on the Chemistry Council when a toxicologist, Dr. Deborah Rice, was removed from the deca review panel at the council's request. The EPA removed Rice as panel chairwoman after receiving a letter from the chemical industry group saying she had the "appearance of bias."
The EPA removed Rice as panel chairwoman after receiving a letter from the chemical industry group saying she had the 'appearance of bias.'
The industry group had insisted Rice was biased because she had expressed concerns about the health risks of deca in the past. A toxicologist for the Maine Dept. of Health and Human Services, Rice had testified before Maine's state Legislature on the dangers of the chemical. In a letter to EPA Administrator Stephen Johnson, Dingell and Stupak wrote, "The ACC…seems to argue that scientific expertise with regard to a particular chemical and its health effects is a basis for disqualification from a peer review board. This does not seem sensible on its face."
It especially doesn't seem sensible when those same peer review boards include scientists with ties to the Chemistry Council. Three panels included people who received funding from the council to research the chemical they reviewed; another panel was chaired by an individual whose employer was under contract by the council to question a key children's health study that found problems with the chemical being reviewed.
When Rice was removed, and the industry scientists were allowed to remain, red flags went up.
The American Chemistry Council did not respond to repeated questions.
Rice's research shows that deca can affect brain development and interfere with thyroid hormones, causing problems in the learning and motor skills of young animals, including humans. Deca has also been found to contaminate breast milk, which could put nursing babies at risk.
The chemical's risk to children is one concern of the Energy and Commerce Committee. "[S]ome scientists have raised concerns that deca has been linked to learning disabilities in children," said Alex Haurek, spokesman for the committee. "Some research suggests that younger children have higher levels of deca in their bloodstream than older children."
The manufacturers of the flame retardant found safe levels of exposure to be 57 times higher than the levels the EPA proposed. But, according to Rice, safe levels are 10 to 100 times lower than what the EPA suggested. In her testimony to the Maine legislature, Rice recommended banning deca altogether - which the state ultimately did.
The chemical industry has admitted an information gap regarding safe exposure levels for children, but left it at that, says Sonya Lunder, senior analyst for the Environmental Working Group.
"We know that kids could be exposed to [deca] many days of their lives," said Lunder. "[The Chemistry Council] has said, we don't know what safe levels for kids are. But there wasn't any step to say, 'Let's fill that data gap.'"
Deca isn't the only chemical being investigated that could be harmful to children. The Energy and Commerce Committee actually discovered Rice's removal while looking into another chemical, Bisphenol A, and its use in products for infants and children. BPA is used to make plastic products, including baby bottles and the metal cans that hold baby formula.
Dingell says there is reason to believe that BPA presents risks to young children. "There is concern in the scientific community that this chemical, Bisphenol A, may be harmful, both to adults and children," said Dingell, "Some retail stores in Canada have pulled products from their shelves because it may harm adults. It would seem obvious that we would try to protect babies and infants from chemicals that may be considered dangerous to adults."
Dibutyl phthalate (DBP) is another such chemical, also used in plastics. As part of their investigation into the American Chemistry Council, Dingell and Stupak are looking at an EPA review panel that supported weakening regulations on DBP by a factor of three. The panel's chair, Dr. Betty Anderson, is a chemical industry consultant whose employer, Exponent, was under contract by the American Chemistry Council to question a study finding health risks of DBP to baby boys. Exponent has defended the use of phthalates in children's toys, backed by the Toy Industry Assn., according to the Environmental Working Group.
There have been other recent actions by the EPA to lower standards for child safety standards that could be cause for concern. Just after Dingell and Stupak launched their investigation, the EPA convened another panel with scientists who have industry ties. This panel is to review a controversial proposal that could weaken safeguards protecting children from carcinogens.
To protect children, EPA guidelines require the agency to strengthen health standards by a factor of 10 for chemicals likely to cause genetic mutations that can result in cancer. Now, an EPA panel is considering changing the rule so it applies only to chemicals that existing studies prove can cause cancer through genetic mutation. However, chemical manufacturers are not required to conduct such studies, so relatively few exist.
The panel's chair, Bette Meek, works for the International Life Sciences Institute (ILSI), a lobby group funded by chemical, drug and food companies. At ILSI, Meek sits on the same committee as several chemical companies - including Dow Chemical, ExxonMobil, Bayer and CropScience - who could benefit from weaker carcinogen standards. The EPA panel also includes Jerry Rice (not related to Deborah Rice), a former consultant for the American Petroleum Institute on benzene - a carcinogen that can cause genetic mutations. Rice is currently a consultant for a law firm that represents chemical companies that would benefit from weaker carcinogen standards.
The EPA's own spokeswoman, Suzanne Ackerman, sounded surprised to hear that a panel would consider weakening safety standards meant to protect children from getting cancer. "This is news to me," Ackerman said. "EPA has always been ahead on carcinogenicity [and kids]."
The Children's Health Protection Advisory Committee, which advises the EPA on regulations relevant to children, has already advised the agency not to support weaker standards. "We had written a letter to Administrator Johnson," said the committee's chair, Dr. Melanie Marty, "and felt it was not scientifically justifiable and going the wrong direction from a public health policy standpoint for protecting people from exposure to carcinogens early in life."
If the Energy and Commerce Committee finds that ties between the EPA and chemical companies are affecting health standards, parents may indeed have something to worry about.
"Chairman Dingell believes that if industry has undue influence over the safety evaluation of chemicals, then the public safety is endangered," said committee spokesman Haurek.
The Environmental Working Group says that government agencies endanger child safety by rolling back safeguards at the request of chemical companies. "The EPA must make decisions and implement policies without undue influence or pressure from the chemical industry by removing panelists with conflicts of interest from all advisory panels," Lunder said in a statement. "Until this is done, the external peer review of EPA's decisions cannot be considered a valid process."
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By Paul Kane
The Washington Post
Thursday 17 April 2008

The Senate moved yesterday toward asking the Justice Department for a criminal investigation of a $10 million legislative earmark whose provisions were mysteriously altered after Congress gave final approval to a huge 2005 highway funding bill.
In what may become the first formal request from Congress for a criminal inquiry into one of its own special projects, top Senate Democrats and Republicans have endorsed taking action in connection with the earmark that Rep. Don Young (R-Alaska), former chairman of the House Transportation and Infrastructure Committee, inserted into the legislation.
"It's very possible people ought to go to jail," said Sen. Barbara Boxer (D-Calif.), chairman of the Environment and Public Works Committee, which oversees highway funding.
Young's staff acknowledged yesterday that aides "corrected" the earmark just before it went to the White House for President Bush's signature, specifying that the money would go to a proposed highway interchange project on Interstate 75 near Naples, Fla. Young says the project was entirely worthy of an earmark and he welcomes any inquiry, a spokeswoman said.
"Congressman Young has always supported and welcomed an open earmark process. If Congress decides to take up the matter of this particular project, there will be no objection from Mr. Young," said Meredith Kenny, his spokeswoman. Young also sponsored a $223 million measure to build the fabled "Bridge to Nowhere" in Alaska, a project that was killed in 2005 after it sparked widespread outrage.
Young's critics suggest that the motive for the I-75 provision was campaign contributions from real estate developers who own 4,000 acres of land near the proposed interchange. In February 2005, developer Daniel Aronoff hosted Young and Rep. Connie Mack (R-Fla.) at a highway safety event at Florida Gulf Coast University, followed by a fundraiser that brought in about $40,000 for Young's campaign.
The developers have been trying for several years to build on the land, whose value would increase if there were a nearby interchange for I-75, which runs east-west between the Naples area and Fort Lauderdale.
Reports about the Aronoff fundraiser for Young in the Naples News prompted inquiries from a local FBI office in 2006.
Local planning officials, who never requested money for the interchange, were outraged to learn after the highway bill became law that they were required to spend $10 million on a project they did not want. The Lee County Metropolitan Planning Organization, the recipient of the money, has rejected it three times in the past year.
Earmarks are requests to fund special projects, usually in a lawmaker's home state or congressional district. They often are used for libraries, sewers and other infrastructure, and every five years a new highway bill brings with it billions of dollars in new earmarks.
The total number and dollar value of earmarks rose sharply in the final six years of Republican rule on Capitol Hill, becoming increasingly controversial as law enforcement authorities pursued several corruption cases centered on their use. Even as their numbers shrank last year, congressional earmarks accounted for $18 billion in the federal budget.
But lawmakers and aides on both sides of the aisle could not recall Congress ever asking for a criminal investigation of an earmark.
The version of the highway bill approved by the House and Senate in the summer of 2005 mentioned only "widening and improvements" for I-75 in Collier and Lee counties in South Florida. After final passage of the measure, but before it was sent to the White House, that line item was altered to specify that the money would go to "Coconut Rd. Interchange/Lee County."
For months, no lawmaker stepped forward to say who had made the change.
"Somewhere along the way, something changed. Nobody knows for sure who did what," Sen. Tom Coburn (R-Okla.), who fought Young's bridge project three years ago, said during yesterday's debate.
Young's office accepted responsibility yesterday for the change, insisting that campaign contributions were not the motive. Rather, presentations made by Florida Gulf Coast University officials and the developers proved the case for the project, aides said.
Kenny, Young's spokeswoman, said the lawmaker always intended for the earmark to designate money to the interchange project, not generic highway improvements. So committee aides altered the bill to reflect that after the House and Senate had approved it.
"There was an error in the bill and so it was corrected," she said.
Young, who is facing his most difficult reelection campaign since he first won office in 1972, has seen his name surface in connection with other investigations. One of his former aides at the transportation committee has pleaded guilty to accepting gifts from disgraced lobbyist Jack Abramoff. And a former Alaska energy services corporate executive, who pleaded guilty last year to bribery, testified in criminal trials that part of his job was to hold annual fundraisers for Young.
Mack has disavowed any association with the earmark request, and the Florida congressional delegation has worked to place language in "technical corrections" to the highway bill that would allow Lee County to spend the $10 million on general improvements.
The corrections bill is moving through the Senate this week, but Coburn said that is not enough. He is asking for a special House-Senate task force to investigate the origin of the earmark and how it was altered without congressional approval, which could lead to a criminal referral to the Justice Department.
"We ought to be able to investigate ourselves," he said.
However, Boxer and Senate Majority Leader Harry M. Reid (D-Nev.) have suggested that constitutional separation-of-powers issues would make it difficult for a Senate investigation of an action in the House. Instead, they have pushed for a resolution asking the Justice Department to investigate.
A Justice Department spokesman declined to comment.

Whose Privilege?
The New York Times | Editorial
Friday 18 April 2008
In the name of fighting terrorism - and with a clear goal of avoiding accountability - the Bush administration has imposed a level of secrecy on its operations that has no place in a democracy.
One of its most disturbing tactics has been seeking early dismissal of lawsuits alleging serious government misconduct, claiming they would reveal national security secrets. The Senate is now considering a good bill that would rein in this misuse of the state secrets privilege and give victims fair access to the courts and the public a fuller understanding of their government's actions.
In recent years, a number of important lawsuits have raised credible allegations of government abuses including torture, kidnapping, rendition and domestic eavesdropping. All too often, judges have blocked these suits without examining how and why going forward would compromise the nation's security.
Congress has also been far too acquiescent, standing aside as the administration undermined individual rights and the constitutional system of checks and balances. It may finally be ready to act.
Next week, the Senate Judiciary Committee is scheduled to vote on the State Secrets Protection Act. Introduced by Senators Edward Kennedy, Democrat of Massachusetts, and Arlen Specter, Republican of Pennsylvania, it would make it harder for this or future administrations to use a flimsy state secrets claim to avoid exposure of illegal or embarrassing conduct.
Legitimate secrets need to be protected, and the bill includes important safeguards. But before judges rule on a state secrets claim, the bill would require them to first review the documents or evidence for which the privilege is invoked - rather than rely on government affidavits asserting that the evidence is too sensitive to be disclosed.
To allow cases to go forward, judges would also be given authority to order the government to produce unclassified or redacted versions of the evidence.
Not surprisingly, the administration is trying to defeat this essential reform. In a recent letter to the Senate, Attorney General Michael Mukasey raised the prospect of a veto and insisted that the president - and not the courts - must have the final say over when and whether the privilege applies. Incredibly, and with no legal basis, he also expressed doubt that Congress has the power to mandate closer review of state secrets claims.
Senator Jon Kyl, Republican of Arizona, is also trying to undermine the act with a damaging amendment that would require judges reviewing state secrets claims to give "utmost deference" to the government, a standard intended to thwart meaningful judicial review.
That, of course, is the problem. The courts have deferred far too often to the president. Passing the Kennedy-Specter bill, without Mr. Kyl's amendment, would go a long way toward restoring the balance and the accountability and openness that are essential for a democracy.
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House Committee Asks Rove to Testify About Ex-Alabama Governor
The Associated Press
Thursday 17 April 2008

Washington - The House Judiciary Committee on Thursday asked former White House adviser Karl Rove to testify about claims that he influenced a federal corruption case against former Democratic Gov. Don Siegelman of Alabama.
The panel also called on the Justice Department's inspector general to investigate allegations that political motivations drove the Siegelman case and several other federal prosecutions during the Bush administration.
Issuing a lengthy report on possible "selective prosecution," the committee cited cases against Pennsylvania coroner Cyril Wecht and Wisconsin state procurement official Georgia Thompson as other examples that are ripe for review.
Like the Siegelman prosecution, both cases had political undercurrents, with critics saying they were engineered by White House-appointed prosecutors to hurt Democrats during election season. A judge recently declared a mistrial in the Wecht case, and a conviction against Thompson was overturned last year.
Judiciary Committee Chairman John Conyers, D-Mich., accused Attorney General Michael Mukasey of not taking the allegations seriously and of blocking congressional requests for documents. Conyers said the evidence presented thus far threatens to undermine public faith in the judicial system.
"The Justice Department has simply not been forthcoming, and I feel the only way to move this investigation forward is to seek further independent investigation and testimony from Karl Rove, who appears to be the missing link in a chain from the White House to the Justice Department," Conyers said in a statement.
Peter Carr, a Justice spokesman, said the department was reviewing the report.
"The attorney general, however, has made clear that the department has and carries out a duty to ensure that its investigations of public corruption are conducted without fear or favor, and utterly without regard to the political affiliation of a particular public official," Carr said.
Rove, who was heavily involved in Alabama politics before directing President Bush's White House campaigns, has denied any involvement in the Siegelman case. But calls for his testimony have grown louder since a Republican lawyer and campaign volunteer in Alabama said last year that she overheard conversations among top Republicans suggesting that Rove was pushing Justice officials in Washington to go after Siegelman.
Rove's attorney, Robert Luskin, told MSNBC earlier this month that Rove would testify on the matter. But Luskin said in an interview Thursday that his comments were taken out of context and that the decision was the White House's call, not Rove's, because it involved questions of executive privilege and separation of powers.
The White House had no immediate comment. But administration lawyers so far have refused to allow such testimony - even under subpoena - in a related congressional investigation into whether Bush administration officials fired federal prosecutors who weren't loyal Republicans.
A Judiciary Committee aide said Conyers "reserves the right" to subpoena if Rove denies the request to appear voluntarily.
Vince Kilborn, a Siegelman attorney, called Luskin's argument a "smoke screen."
"Executive privilege does not apply to political activity," he said. "It's not a White House decision. It's his own decision."
Siegelman served one term as governor but was later convicted in 2006 on bribery-related and obstruction of justice charges and sentenced to more than seven years in prison. Last month, a federal appeals court approved Siegelman's release from prison while he appeals, saying the former governor had raised "substantial questions of fact and law."
The prosecution stemmed from his appointment of former HealthSouth CEO Richard Scrushy to an influential hospital regulatory board in exchange for Scrushy arranging contributions to Siegelman's campaign for a state lottery.
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