Making Government Transparent and Accountable
The Sunlight Foundation uses cutting-edge technology and ideas to make government transparent and accountable. Underlying all of our efforts is a fundamental belief that increased transparency will improve the public's confidence in government
The Sunlight Foundation Blog
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Bailout Recipients Lobbying
From October 1, 2008 through the end of the year, eighteen companies that had received, or would receive, bailout funds spent money lobbying the government. As the bailout is set to move onto round two, there have been concerns that recipients of funds are improperly lobbying the government after receiving the funds. In the past week there has been an effort by Treasury Secretary Timothy Geithner to restrict lobbying of his department by bailout recipients and a bill introduced by Sens. Dianne Feinstein and Olympia Snowe to ban the use of bailout funds for political influence. Some good government groups are objecting to bailout recipient Bank of America’s involvement in organizing opposition to the Employee Free Choice Act.
In total, the eighteen bailout recipients that continued to spend money on lobbying spent $14,810,259 over the three month period of October to December. Of course, many of these companies were lobbying on a variety of issues and did not necessarily spend the full amount listed on their disclosure to lobby on the bailout. All but two of the bailout contracts received by these companies came during the period of which this lobbying spending is the subject. Lobbying on the bailout was determined by whether the lobbyist disclosure forms listed one of the following in the Issue Area provided on the form: H.R. 1424, Emergency Economic Stabilization Act, TARP, and Troubled Asset Relief Program. One bailout recipient that continued to list lobbying expenses, American Internation Group (AIG), has publicly stated that they are no longer lobbying government. The report AIG filed indicates that the expenses were for:
In response to requests and to correct misinformation, AIG provided information about AIG to federal officials in connection with government efforts to address instability and liquidity in the financial markets and congressional oversight of federal programs including the Troubled Asset Relief Program.
Topping the list is the General Motors Corporation with lobbying expenses totalling $3,550,000. The financial arm of the General Motors family, GMAC, a bailout recipient, also spent $,1540,000 on lobbying expenses. Both of these bailout recipients obtained funds at the end of the lobbying disclosure quarter, after Congress rejected a bill granting non-TARP funds for them, suggesting that the majority of the lobbying was done in pursuit of the funds themselves. Four more companies also obtained their bailout funds in the waning days of the year (the end of the disclosure quarter) or in the new year. Those companies are American Express, Chrysler, CIT Group, and PNC Financial Services Group.
Below is the full table of bailout recipients, their lobbying expenses for the 4th quarter, and the first date upon which they were issued bailout funds.
Oct.-Dec. 2008 Lobbying by Bailout Recipients Bailout Recipient Lobbying Expenses (Oct.-Dec. 2008) First receipt of bailout funds American Express Company $1,080,000 1/9/09 American International Group $1,080,000 10/28/08 Bank of America $880,000 10/28/08 Chrysler LLC $1,356,589 1/2/09 CIT Group, Inc. $80,000 12/31/08 Citigroup $1,480,000 10/28/08 General Motors Corporation $3,550,000 12/29/08 GMAC LLC $1,540,000 12/29/08 Goldman Sachs & Co. $720,000 10/28/08 Huntington Bancshares, Inc. $43,670 11/14/08 J.P. Morgan Chase Bank $1,100,000 10/28/08 Morgan Stanley $610,000 10/28/08 PNC Financial Services Group $10,000 12/31/08 State Street Corporation $210,000 10/28/08 The Bank of New York Mellon $330,000 10/28/08 U.S. Bancorp $160,000 11/14/08 Wells Fargo & Co. $580,000 10/28/08 
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Statement: Sen. Levin will Release TARP Contracts
I just received a one line statement from Tara Andringa, press officer for Sen. Carl Levin, on the will he or won’t he question of whether the senator will release copies of contracts that companies participating in the Troubled Asset Relief Program signed:
Senator Levin intends to release the documents, consistent with Senate rules, after reviewing them for proprietary information.
Levin had to fight to get the documents from Treasury; it’s good news that he intends to release them to the public. He deserves credit for announcing this. One wrinkle worth noting — Footnoted, a blog devoted to reading company disclosures to the Securities and Exchange Commission, says that these contracts (the same ones Levin got from Treasury) are already filed on EDGAR (the online SEC disclosure site) — they look at one filing here. I pretty quickly managed to find a TARP contract with American International Group here and one with Citigroup here. I also found an agreement between AIG and something called Maiden Lane II LLC for which the Federal Reserve Bank of New York served as controlling party. The New York Fed so far has rebuffed attempts to pry loose information on its own, non-TARP bailout activities (it would appear that this might be one of them).
I think it’s fair to operate under the assumption that Levin will get more information than that disclosed to the public, but I’m not positive about that.
Thanks much to Michelle Leder, editor and founder of Footnoted, for pointing us to the SEC.
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Sen. Levin: Transparency for me, not for thee
Sen. Carl Levin, angered by the lack of transparency in the Troubled Assets Relief Program, vowed to subpoena the Treasury Department last Sunday if they refused to release contracts that Citigroup and other banks signed to receive funds under TARP.
Treasury assured Levin yesterday that there was no need for a subpoena — they would provide him with copies of the contracts as early as today. Lisa Chiu, one of our intrepid researchers on the SubsidyScope project, wanted to know if that meant the public would have the same opportunity as Levin to see how what banks are agreeing to do with TARP funds.
Dave Pollock, Levin’s spokesperson, told Chiu that the Michigan senator has no plans to release the contracts once he gets them, saying that the Senate Homeland Security and Government Affairs Subcommittee on Investigations – which Levin chairs – typically does not release such documents to the public.
Treasury is giving Levin the contracts that financial titans and totterers like American International Group, Bank of America, Bank of New York Mellon Corporation, Citigroup, Goldman Sachs, JPMorgan Chase, Merrill Lynch, Morgan Stanley, State Street Corporation, and Wells Fargo signed to get billions of bailout money — taxpayer money — last year. Did these firms, as Levin wanted to know, agree to aid borrowers who are trying to keep up with their mortgage payments? Did they offer debt relief to cash-strapped customers? Levin will know, the public won’t. (Update: Levin now says his instinct would be to release the documents. Ours too. So let’s have them.)
Pollack suggested that we contact Treasury if we want the information. We’ve asked; if Treasury says no, we’ll file a Freedom of Information Act request. With any luck, and assuming that the FOIA request will be handled with the usual speed, they should have the documents, oh, a year or two from now.
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The Revolving Door, Robert Rubin, and Citigroup
Today, President-Elect Barack Obama named the key members of economic team including Timothy Geithner as Treasury Secretary and Larry Summers as head of the National Economic Council. Notably, many in Obama’s economic circle are acolytes of former Clinton Treasury Secretary Robert Rubin, the subject of much talk in the wake of the bailout of Citigroup. Rubin, a revolving door spinner between Wall Street and Washington, began his career at Goldman Sachs, moved to the National Economic Council, then Treasury, and in 1999, left government and joined Citigroup. Rubin’s story provides a telling story about the conflicts of interest that can occur when a high-ranking official moves so seemlessly between the public and private sector.
In this New York Times article addressing Citigroup’s economic troubles, Rubin appears as a key player, in both the deregulation that allowed the bank to become so large and unwieldy and as an adviser to the bank urging riskier behavior: (Continue reading…)
