IN EARLY 1997, it was time for Jack Quinn, Mikva’s replacement as counsel to the president, to leave the White House. He turned to his colleague Sheri Sweitzer, asking who should join him to start a law practice at his old firm, Arnold & Porter. “I need someone who really knows how to make his boss look good,” Sheri said, “How about Jeff?”
After leaving the White House, I’d joined Covington & Burling, a top DC law firm, ostensibly to practice appellate litigation but actually, or so it seemed to me, to rack up as many billable hours as possible for the firm. I was miserable. Jack’s call was a godsend. It started a new and very different chapter of my Washington life.
In my new career as a lobbyist, I dropped Biden’s name shamelessly. Perpetuating the myth that I was close to him enhanced my cachet and standing in Washington. It was like a political version of codependency. Biden’s slights could be painful, but it seemed too late to break ranks, even though the relationship never actually helped me when I went to work with Jack. Biden never lifted a finger for me or for one of my clients. Every evening after work, he rode a train back to his home in Wilmington. He’s a family man and indeed an ordinary Joe. Unlike most of Congress, he hardly ever schmoozed with the Permanent Class. He did the best he could to stay as far away from it as possible.
Not me. When I started lobbying, I was thirty-eight years old and had few assets: no house, a cheap car, and a four-figure bank account. I’d made modest salaries in government and spent all my Wall Street savings on law school. I’d stayed in Washington for reasons that had little to do with issues or ideology; for me, it was now mainly about establishing a DC profile, making money, and helping Democrats beat Republicans.
My timing was great—that is, if I wanted to make a lot of money in DC’s private sector. The money spent by corporations to influence Washington at least tripled in my twelve years as a lobbyist. In 1997, when I started, politically active organizations reported $1.26 billion in direct lobbying expenses. When I left to rejoin government in 2009, that figure had increased to $3.47 billion. Controlling for inflation, that’s almost seven times the estimated $200 million in lobbying expenses reported in 1983. Approximately fourteen thousand organizations are now listed in the directory of Washington representatives, double the roughly seven thousand listed organizations in 1981.
These figures don’t capture how much Corporate America spends on public affairs and public relations, which don’t require public reporting. Hybrid firms often take a fee from clients and decide that half was for lobbying and that half was for public relations like communications and media strategy (which isn’t subject to reporting requirements). And there are other ways a corporation or trade association can spend money in Washington to affect government outcomes, such as hiring law, analytical, grassroots, and third-party-outreach firms (which also isn’t subject to disclosure). In other words, the total amount of money being showered on former (and future) public servants is vast and unknowable.
Washington makes decisions that have an economic impact worth millions of dollars to individual companies, billions to sectors of the economy, and trillions to the economy as a whole. That’s why it makes sense for big business to flood Washington with cash (and do the same thing on a smaller scale in state capitals across the country).
The problem isn’t new. In 1913, Woodrow Wilson wrote: “If the government is to tell big business men how to run their business, then don’t you see that big business men have to get closer to the government even than they are now? Don’t you see they must capture the government, in order not to be restrained too much by it? Must capture the government? They have already captured it.”
When the corporate pie tripled in just over a decade, so much money was being spent in Washington that it completely changed the culture. Just like on Wall Street, when the benefits available to professionals skyrocketed, and the costs of certain behaviors or norms diminished, people rationally started making different choices. The ranks of lobbyists swelled (as did the potential wealth available to former public servants), and the sophistication of corporate campaigns intensified.
At Arnold & Porter, Jack charged clients a flat retainer with a minimum one-year contract. The monthly fee, which ranged from $20,000 to $40,000 (but sometimes higher), depended on the complexity and intensity of the assignment. Jack was an entrepreneurial lawyer who had no interest in methodically keeping timesheets and billing on an hourly basis.
Jack saw the enormous value of Washington counsel, particularly for companies engaged in transactions that required regulatory approval. Investment bankers charged huge fees, often earning a percentage of the successful deals they advised or underwrote. So why, Jack wondered, shouldn’t Washington lawyers, who had as much or more to do with a deal’s ultimate success, be paid just as handsomely? It took chutzpah, which Jack had. Soon, a wave of mergers came along that permitted us to test his theory.
One of them was SBC’s first attempt to acquire AT&T. It had been less than a decade since the Justice Department had forced “Ma Bell” to spin off seven regional Bell operating companies, one of which was Southwestern Bell Company, which had shortened its name to SBC. Headquartered in San Antonio, Texas, SBC was a longtime client of Arnold & Porter. When SBC began thinking about acquiring AT&T, it knew the bold, audacious move probably would strike the public and Washington regulators as difficult to swallow. So SBC assembled a team, including Jack, to devise a government- and public-relations strategy.
SBC’s general counsel offered Jack a fee of $100,000 for one month’s work, knowing that the deal would require an immense effort on our part with key decision makers. Even though my salary was determined by Arnold & Porter’s rigid pay structure for associates and not by Jack’s success, it was obvious I’d joined a lucrative practice.
Our first Arnold & Porter team meeting revealed the difference between the flat-retainer and hourly billing mindsets. The first instinct of the firm partners who were paid hourly was to make a long list of every possible task that the firm’s lawyers would need to perform. Jack and I, in contrast, had only one thought: to meet immediately with Fritz Hollings (chairman of the Senate Commerce Committee) and Reed Hundt (chairman of the Federal Communications Commission). Why? Because either of them could pronounce the deal stillborn on the day of its announcement. Billing on retainer gave us the incentive to devote our efforts to those strategies and contacts that would maximize the likelihood of success, not to maximize the legion of lawyers whose hours we could bill.
Sure enough, word of the possible deal leaked out before SBC could announce it (or unleash us to make contacts). The press reaction was overwhelmingly negative, and Reed Hundt was almost instantly quoted as saying such a merger would be “unthinkable.” SBC’s growth ambitions suffered a temporary setback. But Jack’s model of high-dollar retainer fees had been vindicated. The hourly lawyers barely did any billable work, while Jack pocketed a $100,000 fee.
In the early months of our new practice, Bell Atlantic was trying to acquire Nynex. Like SBC, Bell Atlantic and Nynex were Baby Bells created when the Justice Department broke apart the original AT&T monopoly. Combining Baby Bells would therefore be viewed skeptically by the department. About this time, I happened to have lunch with Aubrey Sarvis, an old friend and fellow Southerner who was then head of government relations for Bell Atlantic. More than an hour of chitchat passed before we began discussing the Bell Atlantic–Nynex deal, in which Aubrey was immersed. Soon, our talk turned to Joel Klein, who had been Mikva’s deputy in the White House counsel’s office before becoming principal deputy assistant attorney general of the Antitrust Division and then assistant attorney general, the top man for antitrust review in the Clinton administration.
I mentioned that I’d worked closely with Joel in the White House and thought he was very smart and a good guy. My words were guileless. I hadn’t yet become a voracious new-business seeker who tried to turn every friend into a client. That would come later. On that day, Aubrey was just a friend, and I was happy to talk. Aubrey leaned forward and probed me for more information about Joel. I told him all I knew: the work Joel and I had done together, how Joel thinks, how he analyzes issues. To be honest, I didn’t have any earth-shattering insights into the mind of Joel Klein. But for Aubrey, whose company had a multi-million-dollar deal before Joel, any intel was worth knowing. He interrupted me only to call Bell Atlantic’s general counsel and explain my relationship with Joel. A few minutes later, we were in a cab to go meet with the general counsel at his office in Arlington, Virginia. And the general counsel had soon heard enough to want to hire Jack and me to help with the Nynex deal. I’d brought in my first client. Jack was pleased.
My first assignment was to call Joel, let him know I was working on the Bell Atlantic team, and ask him for a status update. He was amused: “I suppose it’s good that several of my friends are going to make some money off this deal, but Bell Atlantic could hire my mother, and it wouldn’t make a difference in how we analyze it.” I hadn’t thought it would make a difference. But at least Joel had taken my call. What’s more, he gave me a carefully worded status update that I could take back to my new client. In Washington, that’s worth something. Bell Atlantic was paying Arnold & Porter $25,000 a month for a minimum of a year for Jack and me to make such calls. And do meetings. At some point, the Bell Atlantic lawyers had their opportunity to present their case directly to Joel and the other top Antitrust Division lawyers. Bell Atlantic dragged me along to the meeting, even though I didn’t have a speaking role.
After the meeting, Joel pulled me aside to say hello. “These guys weren’t going to let you say anything?” That was a hard but good lesson. If you go to a meeting as an ornament, but don’t argue the substance of your client’s position, you lose credibility with the government official you asked for the meeting.
In those early months I worked with Jack, I began to think that his advice and counsel were exceptional. And from where the client was sitting, oftentimes clueless about the inner workings of government, worth the extravagant sums he was being paid. For two-and-a-half years, Jack had been the vice president’s chief of staff and, for almost two years after that, the then-current president’s counsel. Clinton had seen a late-night rerun of Jack testifying before the Whitewater Committee chaired by Senator Alfonse D’Amato. The next morning when jogging, Clinton reportedly asked an advisor, “Did you see Jack Quinn before the D’Amato Committee?” Clinton thought Jack was tough (what he wanted in his next counsel), and so he hired Jack away from Gore (who was none too pleased).
On Jack’s office wall, he kept a picture of Clinton and Gore, with Jack walking between the two of them in the hallway of the Old Executive Office Building. Clinton was leaning his head over to say something funny in Jack’s ear, Gore was leaning across Jack to hear what Clinton was saying, and all three were smiling and laughing like middle-aged college chums. It was a priceless picture, and one that every client and potential client gazed at with awe, as did I. Few if any people for hire in Washington had Jack’s experience at the highest levels of our government.
In meeting after meeting with clients and potential clients, Jack held them (and me) in rapt attention. Time once referred to him as “the savvy Jack Quinn,” and savvy he was. He had an uncanny ability to listen to a client’s description of a challenge, absorb it, think about it for a few minutes, and then lay out in clear and concise prose the parameters of the key issues—and the beginnings of how to assess it in a tailored, strategic framework.
Then, inevitably, Jack would turn the problem around or inside out and look at it from a different perspective. He rarely followed the conventional path. He liked to reverse assumptions, challenging the CEO to try thinking about a matter from the exact opposite approach. Oftentimes that led either to key insights or to a strategic or tactical idea that no one in the room had thought of previously. I was becoming a huge fan. I genuinely believed: This is valuable Washington counsel. We can sell this and make a lot of money.
Jack was particularly valuable in a crisis, when the situation was chaotic and uncertain. For years, the Clinton White House had careened from one crisis to the next, and Jack had excelled in that White House. His credibility on crisis management issues was therefore extremely high. This is, obviously, useful. At times of stress, the CEO and other top officers of a company living through a crisis could say to the Board of Directors: “We hired Jack Quinn, and he’s the best, and he says we should do X, Y, and Z.” It’s the analogous reason companies hire the most prestigious law firms: Regardless of what advice one gets, if things turn out badly, the company executive can always say “We hired the best firm in DC.”
At Covington & Burling, I had drifted into the realm of issues involving Silicon Valley. I had worked on a brief arguing that the export controls on encryption (which scrambles data and turns it into unintelligible code) raised First Amendment issues, as encryption essentially is commercial speech. Furthermore, as a former math minor in college, I innately grasped the Silicon Valley argument that encryption is mathematics—even if sophisticated math used to write computer code—and that any attempt to stop math from spreading beyond our national borders was futile. The Swiss and Japanese were already selling sophisticated encryption beyond the levels permitted by U.S. export controls, and so the U.S. government (the argument went) was needlessly hamstringing the leadership of U.S. information technology industries and products.
I told Jack I believed this was the leading issue for Silicon Valley, and that we should go to Northern California and target Silicon Valley companies as clients, to help them devise a strategy for addressing the legitimate national security concerns at issue. Our timing was perfect, as the normally fierce Silicon Valley competitors (Microsoft, Oracle, Intel, Sun Microsystems, and others) were for the first time talking amongst themselves about organizing an encryption-export reform coalition to lobby Washington and shape the media debate. Jack and I did a round of meetings with all of these companies and were close to being hired.
The Business Software Alliance—the trade group in Washington—was taking the lead in forming the coalition and hiring consultants. Eventually, after we made another round of pitches to BSA executives, the coalition hired Jack to be the lead Democratic consultant and a guy named Ed Gillespie to be the lead Republican.
I had never heard of Ed. It was 1999, and I soon learned that he had been a longtime aide to former House Majority Leader Dick Armey. As policy and communications director for the House Republican Conference, Ed was among those who had drafted the Contract with America, the 1994 campaign platform which (at least in hindsight) was given credit for the Republican gain of fifty-four seats and, for the first time in forty years, control of the House of Representatives. Ed had also worked for Haley Barbour at the Republican National Committee, and after leaving Armey’s staff, had opened Policy Impact Communications, a public relations firm that was a subsidiary of Barbour’s lobbying firm.
Ed is a typical blue-collar Irishman, even given to calling his male friends “laddie.” His father had been wounded in World War II and awarded a silver star, and he then went on to run a bar in New Jersey for many years. Ed was no Country Club Republican. His first job on Capitol Hill was as a Senate parking-lot attendant. Ed was easy to like and had an extremely affable manner.
Jack, Ed, and I were Irish and had been raised from modest upbringings. Jack’s father had worked for the power company in New York City for forty years, and my father had never made more than $50,000 a year while working as a chemical engineer for the Army Missile Command. Over the next decade, Jack, Ed, and I went on to make many millions of dollars together. I’m convinced the success of our partnership and friendship was rooted in our shared Irish ethic of hard work and common decency toward one another. Plus Jack and Eddie liked to laugh.
It didn’t start smoothly, however. At one of the first organizational meetings, with representatives from each of the major Silicon Valley firms, I made a point and Ed tried to silence me. I stood up to him and made my point again, and we had a brief argument in front of all the clients. Because this was a Republican and a Democratic consultant clashing on the first day, it began to look as if a bipartisan approach to working together was going to be rocky. At the next meeting, however, to my great surprise, Ed publicly apologized to me and granted that the central point I was making had been correct. I don’t even know if I had been right, but Ed’s willingness to be humble and conciliatory in front of the group spoke volumes about him.
The Jack-and-Ed strategy for encryption reform was that, to accomplish a complex objective in Washington, one needs a multifaceted campaign. In the old days, lobbying had been about getting to the right decision-maker. By 1999 (and even more so today), power in Washington had become far more diffuse. The key to success, Jack and Ed explained, was an effective and sustained communications strategy built on a winning message—backed by well-marshaled substantive advocacy—and delivered through multiple channels targeted at multiple audiences.
Lobbying of Congress—done effectively by both Democrats and Republicans, at the committee and leadership level—is just one channel for delivering the message. Working to shape the media’s view of the issue is another, critically important component. Decision-makers read and are greatly affected by news reports, columns, and editorials. Moreover, an aggressive grassroots campaign to pressure targeted members of Congress in their home districts was part of our strategy and is now commonplace. A campaign needs a Web-based presence and online communications strategy. Finally, especially on a matter as complex as encryption export controls, one must devise and coordinate an effective approach to shaping the views of the multiple agencies inside the administration, which each have a stake in the issue.
As one can tell, all this can add up to a complicated and expensive affair. It makes great sense to hire strategic masterminds with great contacts in government and the media and long experience in Washington (like Jack and Ed) to coordinate a years-long, multi-million dollar effort.
Once immersed in the issues, Jack, Ed, and I agreed fairly quickly on what would be the tipping point. We’d never win until a critical mass of the national security “community”—writ large, including outside experts and former government officials—adopted the view that attempts to control encryption were futile. The government’s emphasis should be on gaining the industry’s help to increase the sophistication inside our national security agencies at countering the uses of strong encryption, so the U.S. government can still spy effectively on America’s enemies. We could lobby and “spin” until we were blue in the face, but if the national security community was against us, we’d remain stymied. The high-tech industry needed to be a responsible partner and help the government to develop cutting-edge solutions to address an important national security challenge.
That’s what we communicated all over Washington for the next two years. It was an intense effort on many fronts, but it led to a complete success. The Clinton administration issued liberalized rules for export controls, and Silicon Valley was happy with us. I had become a successful lobbyist, the junior partner to one of DC’s most respected wise men.