The Audacity of Axelrod

By mw | Related entries in Barack, Chicago, Ethics, Health Care

Chicago Style.

The mainstream media is starting to take a closer look at this guy. So it begins…

Timothy Burger – Bloomberg:

“Two firms that received $343.3 million to handle advertising for Barack Obama’s White House run last year have profited from his top priority as president by taking on his push for health-care overhaul. One is AKPD Message and Media, the Chicago-based firm headed by David Axelrod until he left last Dec. 31 to serve as a senior adviser to the president. Axelrod was Obama’s top campaign strategist and is now helping sell the health-care plan.”

Ken Vogel – Politico:

“Critics of President Obama’s health-care overhaul are zeroing in on his senior adviser David Axelrod, whose former partners at a Chicago-based firm are the beneficiaries of huge ad buys—now at $24 million and counting—by White House allies in the reform fight. The unwelcome scrutiny, largely from Republicans, comes at an inopportune time as Obama seeks to shore up support for health care reform. It revolves around two separate $12 million ad campaigns advocating Obama’s health care plan that were produced and placed partly by AKPD Message and Media, a firm founded by Axelrod that employs his son and still owes Axelrod $2 million.”

Stephanie Condon – CBS

“The White House and the pharmaceutical industry are pushing back against allegations that one of President Obama’s senior advisers is personally benefiting from industry cooperation on health care reform. On Tuesday, the House Republican Conference published a one-page talking points memo that says, “Even as President Obama campaigned on a platform of change and transparency, recent dealings between the pharmaceutical industry and the administration raise serious questions as to whether the drug lobby is helping to bankroll a multimillion dollar severance package for one of the president’s senior advisors.”

If there is one lesson that any adviser to a sitting president should have learned by now it is this: It is not necessarily actual conflict of interest or impropriety that bites you in the ass. It is the appearance of conflict of interest and impropriety that is political poison. While not always fatal to a political career, it is always very damaging to a presidency. This was true for Bert Lance. True for Michael Deaver. True for the hordes associated with Iran-Contra. True for the legions touched by Whitewater. True for Dick Cheney. True for Karl Rove. And it will be true for David Axelrod.

As Hugh Hewitt points out, there is a direct comparison to the Dick Cheney/Halliburton deferred compensation connection that had the left foaming at the mouth:

“It should take about ten minutes this morning for Robert Gibbs to provide details of Axelrod’s “retained interest” in his old firm –the term used by Democratic Senator Frank Lautenberg when he was blasting Dick Cheney vis-a-vis Halliburton– and Axelrod’s participation in negotiations with any interest that is providing money to any group providing money to his old firm. With those facts in hand there are scores of D.C. lawyers who can comment on whether any of the many ethics laws governing the financial interests of senior advisors to the president have been violated.”

Predictably, the right-o-sphere jumped on the story, precipitating a minor memeorandum blogstorm (ok – more like a heavy blog-drizzle) including Hot Air, protein wisdom and RedState. Their “enthusiasm” will give the left an opportunity to dismiss this story as right wing hyperbole. That would be a mistake. There has been too much smoke around David Axelrod for too long. Too many “appearances of impropriety” are piling up for an administration that ran on transparency and “change we can believe in”.

As with Jimmy Carter, the press is eager to reverse perceptions of favorable treatment to this president. It is easier to target someone close to Obama rather than the popular president himself. This is the role that Bert Lance played in the Jimmy Carter administration. It may be the role played by David Axelrod in this one. Even if this story does not have legs, it tarnishes the administration halo. How Obama handles the accumulating Axelrod “appearances of impropriety” may very well turn into a bigger test of his presidency than than the health care debate. This is the lesson of the Jimmy Carter Presidency.

Axelrod is a very smart guy. He knows how to cover his tracks. He knows how to walk the line. This is why I am surprised he chooses to walk so very very close to the ethical edge. Maybe it’s a Chicago thing. I’ve been following him for some time and think he has crossed that line more than once:

October 28, 2008 – Barack buying the election?:

“One wonders how Axelrod takes a leave from a co-located consulting firm with only three partners and where he is the “A” in ASK Public Strategies. Did they divide the office with blue tape on the floor and keep Axelrod on one side? Does he wear blinders and earplugs when in the office? But I digress… Also among ASK’s clients? You guessed it. From Business Week:

“Among ASK’s other clients: AT&T. The telecom company, formerly known as SBC Communications, had been a customer, Sedler confirms, when it requested ASK’s help to defeat a broadband referendum..”

And why shouldn’t AT&T hire Axelrod’s firm? After all, the “S” in ASK is David Axelrod’s partner Eric Sedler:

“Prior to joining ASK Public Strategies, Sedler served as a Public Relations Director for AT&T Corporation, managing the company’s offices in Chicago, Atlanta and Miami. In that position, he was responsible for directing the company’s corporate public affairs campaigns in the central and southeastern United States.”

So AT&T gives a lot of money to ASK. Some of that money is in David Axelrod’s pocket, as one of three partners in ASK. But David Axelrod is on “leave” from ASK. Nothing to see here. Move along.”

November 6, 2008 – Comment on Donklephant:

“He is twice as good Rove or if you prefer, twice as bad as Rove. Same difference. Definitely this is “Barack’s Brian” like Rove was to Bush… It would be real interesting to know who ASK’s clients are now, but the client list on their web page came down when Axelrod went to work on the Obama campaign. Axelrod said he was on leave from ASK, but this organization shares office space and has the same partners as the political consulting firm where he was still working. How does that work? In this new role shouldn’t we know who the ASK clients are? Shouldn’t we know the exact nature of his financial relationship with ASK both now and during the campaign? Where is the transparency?”

Last week - The Audacity of Astroturfing:

“The MSM mostly gave him a pass during the campaign as he claimed he was on leave from ASK (while working in the same office for the co-located political consulting firm AKPD) and said he had no intention of being part of the administration. I highlighted this relationship during the campaign, when I though it a little too cozy that ATT was a big client of ASK, and Senator Obama conveniently flip-flopped on Telecom Immunity… Per the Sun-Times, when he accepted the position with the administration in January, he “sold” his stake for $3M to be paid out out over 5 years. It was also disclosed that he received a partnership check of $151,914 from ASK in 2008. That was in 2008, when he was on “leave” from ASK. I guess it was a paid leave. So in 2008, ATT money went to ASK and ASK money went to Axelrod.

Let’s walk through this buyout again. ASK Public strategies is a going concern, and will continue to have funds flow from their corporate “astroturf” clients into their coffers. Then money from the ASK coffers will flow into “Astroturf King” David Axelrod’s pockets to compensate him for the buyout over the next five years, – coincidentally – exactly enough time to get past Obama’s first term and election campaign. Of course, by then, he may get tired of politics, and ASK may want sell his share of the partnership right back to him.”

Yes, I am stealing this post title from myself. I think I can make a legitimate claim to being “patient zero” of a hot new blogospheric pandemic infection – ADS (Axelrod Derangement Syndrome). Does anyone really believe that this will be end of the revelations about David Axelrod? Barack Obama would be well advised to put some distance between himself and his favorite political adviser. There may not be enough spark in this story to light the fuse, but when the Axelrod time bomb goes off as it inevitably will, there will be collateral damage.

X-Posted from Divided We Stand United We Fall


This entry was posted on Thursday, August 20th, 2009 and is filed under Barack, Chicago, Ethics, Health Care. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

7 Responses to “The Audacity of Axelrod”

  1. Nick Benjamin Says:

    Question:
    Does Axelrod’s buyout become more valuable if the firm does well?

    As far as I can tell it doesn’t. He gets a flat $3 million.

    Does Axelrod have a way to buy back in? As far as I can tell he doesn’t have a guaranteed deal.

    Which means is only interest remaining in the firm in that it survives long enough to pay out that $3 million.

    Which begs the question:
    What do you think he should have done? Written off his share in the firm completely?

  2. mw Says:

    Nick,
    I don’t know the details of the buyout agreement, as to my knowledge the contract has not been made public. From what I have been able to determine on-line, all that is known is his representation of the agreement when he formally joined the administration in January. This would be one thing he could do in the spirit of “transparency”. Make the agreement public.

    I don’t think anything illegal is going on. Probably just your usual run of the mill every day Chicago-style graft.

    This is all about context and appearance of conflict.

    The context is that Axelrod is the President’s closest adviser in an administration that represents itself as the most ethically stringent and transparent in history. In that context, it is incumbent on Axelrod to avoid the appearance of conflict of interest. In that context I can think of another thing he could do – How about this – As a key administration official involved in secret negotiations with big Pharma over the Health Care Bill, where he is demanding tens of of millions of dollars of advertising in support of the administration position as quid pro quo for concessions on the bill, how about – I dunno – he make sure that money is not directed to a firm with his name on the masthead and his son on the payroll? Just a thought.

    Bill Allison of The Sunlight Foundation puts it in context:

    “… the selection of Axelrod’s former firm to push the president’s top initiative raises appearance questions, particularly since Axelrod’s son Michael still works there, said Bill Allison of the Sunlight Foundation, which advocates for stricter government disclosure and ethics rules.

    “The big issue seems to me whether there is a quid pro quo with PhRMA,” said Allison, adding “there’s no evidence that Axelrod steered the business to the firm. But the fact that special interests like PhRMA and the American Medical Association working hand in glove with the White House picked a firm that is so close to the White House shows how incestuous Washington can be.”

  3. superdestroyer Says:

    David Axelrod is smarter and more capable than Karl Rove while being as controlling and power hungry. Yet, the media has given him a pass. Everything that Axelrod does is attributed to President Obama instead of to the real brains of the organization.

  4. mw Says:

    @supe
    I think most people do recognize him for what he is, but there is a weird dynamic on the left regarding Axelrod. The best I can describe it is an attitude of…

    “Yes he is probably corrupt as hell and a lying ball-busting SOB that is politicizing everything just like Rove did, but he’s our lying ball-busting SOB, so it’s all good. Just don’t rub my nose in it. I don’t really want to know what he is doing, and would prefer to pretend he doesn’t exist.”

    Hence, not that much coverage, and little interest when there is.

    This is the change I do believe has taken place – we’ve changed the party, changed the players, and changed the rhetoric – but the ethics and the game is identical. Maybe even worse, since fewer believe it and with Single Party Rule, Congress has abrogated their oversight role. No one is watching the store.

  5. Nick Benjamin Says:

    He’s a ball-buster, and he’s in politics (and thus inherently untrustworthy), but until he orders US Attorneys to indict opponents for political reasons he’s not as bad as Rove.

    Or manipulates terror alert levels to convince people to vote for his guy.

    You don’t have to like Axelrod. But you do have to admit that if this is the worst he can do in 10 years nobody will be accusing a political operative of “being as bad as Axelrod.” They’ll still be saying “As bad as Rove.”

  6. superdestroyer Says:

    Nick,

    They have already manipulate the state of the economy to have veto power on the automobile industry and to give the UAW whatever it wants. In addition, the stimulus money is flowing into the pockets of the core Democrats groups such as big city political machines.

    President Obama did fire all of the U.S. attorneys. Who knows if they have all been replaced yet. Who knows if all of the political appointee positions have been filled.

  7. Nick Benjamin Says:

    Every President fires all the US Attorneys. What was different about Dubya was that he ordered his appointees to prosecute democrats, and then fired those who didn’t comply.

    Your economic points are simply bizarre. Name one President, in the entire history of these United States, that has NOT used the budget process to benefit his ideological allies. Besides Washington.

    I’m not claiming Obama is squeaky clean. I’m claiming they’re normal, so far, and that Rove was much worse than normal.

    You got something better than that?

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