36 ▶ ▶ FEC. But notasinglemajor FEC. in-house attorney at the it,” says Gross, aformer top how to take advantage of curious, andwant to know interested, “They’re elections. fall’s withthis connection midterm whether—to respond to therulingin Fortuneing wary 500clientsonhow—or well-compensated hours. He’s counsel- FEC. But notasinglemajor FEC. it,” says Gross, aformer top curious, andwant to know interested, “They’re elections. fall’s withthis connection midterm whether—to respond to therulingin ner withthefi rm White House, Kenneth Gross, A. apart- Street from theTreasury and Dept. for means them.”what thedecision player to townfi inthis trying is gure out lobbying fi rm.“Pretty much every acorporate law-and-Patton Boggs, says William J. McGinley, with apartner “Our are phones off ringing thehook,” Washingtonwell-connected lawyers. mediate wake United ofCitizens are toer forinfl businesses uenceelections. sure that legislation could make ittricki- in Congress.They are drafting disclo- provoked abacklash amongDemocrats ads. To thecontrary, has thedecision aside fresh attack money for campaign resulted incorporations rushing to set Day.Election Sofar, though, ithasnot defeat upto offederalright candidates penditures advocating or theelection and unionsmay make unlimited ex- address, that companies established StateoftheUnionBarack Obamainhis nounced aweek later by President mayturning out, have beenhasty. porations andbiglabor. Thehoopla,it’s U.S. from politics theinfl uenceofcor- sive breach protecting of the ramparts sion provoked condemnation asadeci- zens The Supreme Court’s in decision Are HoldingFire Why Companies Politics&Policy likeliest 42 todepart Contents Meagher &Flom,
“Our“Our phonesare phonesare ringingo ringingo says says thehook,” oneWashington thehook,” oneWashington lawyer lawyer rulingoncorporateThe highcourt spendinghasn’t campaign beenagame-changer. Yet From asunny office across 15th The only obvious winnersintheim- Jan. issued The ruling, 21andde- United v. Federal Election Commis-
A Senatepanelvote: Abadsignfor Wall Street lobbyists? is also logging long, long, alsologging is Commentary: Family▶ Commentary: doctorsdeservepay ahefty raise Skadden, Slate, Arps, Citi- groups may spend asmuch asthey like ruledthatandinterest companies jority by ma- thecourt theFirstAmendment, ad speech spendingprotected to political would leadyou to believe.” more thanallthehype complicated for complicated corporations— is This palpable move to take advantage ofit. company, hecontinues, “hasmade a and examples of recipients. the totalamount eachgave in2009, committees. Thetopfive corporate PACs, fashioned way, throughaction political Many companiesalready contribute theold- Corporate Giving republican Whip republican Whip representative Rob Portman Kay Granger Eric Cantor Eric Cantor ForFor paC paC Contributions Contributions in in an an eleCtion eleCtion CyCle CyCle CanDiDatesCanDiDates reCeiVeD reCeiVeD $10,000 $10,000 MaXiMuM MaXiMuM alloWeD alloWeD Data: FeC, Center For responsiVe politiCs. all Mark Kirk Roy Blunt candidate candidate candidate Let’s sort it out. Comparing campaign Let’s campaign Comparing itout. sort (r-ohio) (r-tex.) (r-Mo.) senate senate senate (r-Va.) (r-Va.) house house house house (r-ill.)
38
▶ CharlieRose talks toRahm Emanuel Honeywell $1.6 million $1.7 million Lockheed $1.1 million $1.1 million $958,850 Comcast Boeing AT&T 44 ● Edited by Paula DwyerandBrianBremner Kendrick Meek house speakerhouse representative Majority leader Nancy Pelosi John Adler Steny Hoyer Gillibrand candidate (D-Calif.) senator Kirsten (D-n.J.) (D-n.y.) (D-Fla.) ( senate below) (D-Md.) house house
partner with partner sayspoliticians, DeLacy, Christopher a to beidentifi edas going after particular don’t mostbigcompanies blessing, like diffpractical erence.” for Senator Smith.’ That’s notmuch ofa magic words: ‘and by theway, don’t vote “After stop ruiningAmerica,’ ” Persily explains. for ads that said,‘Tell Senator Smithto United, acompany oraunioncould pay oppose “Sobefore candidates. long asthey didn’t ex plicitly endorseor enjoyed FirstAmendmentprotection as heldthattices corporate andunionads paign fi nance 2007 In regulations. thejus- that have narrowed down orstruck cam- by theRoberts ofdecisions series court Law School.It’sColumbia thefourthina professor oflawat science andpolitical changer , predictsNathaniel Per sily, a up to itsinitial game- billingasapolitical law in2002. enacted McCain-Feingoldthe bipartisan election down opinionsandstruck of part Court overruledThe justices Supreme prior two cacy. abigdeal. is this jurisprudence, As of theirown advo- money onpolitical ber, thenation’s busi- best-funded year,Commerce. This thecham- spending even theU.S. Chamber of Obama andotherDemocrats,out- more than$70 millionto helpelect national Union, allon itsown, laidout Employees theService In 2008, Inter- politics. money permeatesAmerican the extent to which special-interest parties.) orpolitical candidates or coordinated to federal contributions for andunionsto companies make direct candidate.” (Itremains by illegal, theway, move, especiallyifyou pickthewrong arisky is directly campaign into apolitical 41 41 With orwithout theSupreme Court’s United Citizens ,however, may notlive None of this is meant to meant minimize is None ofthis ▶ Exitramps from theWhiteHouse:Who’s , they can add the add Unitedthe Citizens , they can Holland &Knight. Citizens Citizens “To jump
➡
(bottoM) oliVier Douliery abaCa press/MCt/lanDoV April 26 — May 2, 2010 Zynga’s Bloomberg Businessweek Facebook strategy Politics&Policy page 47 ▶
Drawing Board land Representative Chris Van Hollen. “Citizens United is being used as a pre- text to pursue much broader regula- tions of the private sector in the political arena,” Law argues. There are other ways to capitalize on the ruling, says Greg Casey, presi- dent of the Business Industry Political Action Committee, another Washing- ton group. Under Citizens United, com- panies should now feel free to recom- mend that their own employees vote for particular lawmakers, he asserts. “It is fair to assume that [employers] see this as an opportunity for public education, particularly about issues,” Casey says. In late January, BIPAC held a conference call to discuss the ruling with represen- tatives of member companies. One of the participants, Devon Energy, will move cautiously, says Wil- liam F. Whitsitt, senior vice-president of ness lobby, says it plans to spend ties in the Senate and House. Demo- the Oklahoma City-based oil and natural $50 million on political advertising—and crats such as Representatives Dina Titus gas producer. “A lot of us,” he says, “are the White House isn’t even up for grabs. of Nevada and Alan Grayson of Florida, trying to understand what the implica- Under existing law, companies can both from highly contested districts, are tions of the ruling might be for big labor 38 express themselves anonymously via thought to be vulnerable. “A lot of spe- and for corporations like ours.” contributions to the political war chests cial interests are not happy,” says Gray- —— Paul M. Barrett and Jonathan D. Salant of nonprofi t groups such as the Cham- son, a sharp critic of Wall Street. “God The bottom line Companies likely will be wary ber. “The vast majority of corporate only knows what they’ll spend.” about exploiting the recent Supreme Court ruling on money will move through trade associa- William C. Miller Jr., the chamber’s corporate-fi nanced election ads. tions and independent organizations,” senior vice-president for political aff airs, says Michael E. Toner, a former Republi- says it anticipates focus-testing candi- can chairman of the FEC. date-specifi c ads. “But talking about the Citizens United will allow the cham- issues and trying to inform voters are Financial Regulation ber and the SEIU to be more direct in maybe more powerful,” he says. “Dictat- pushing their messages. Regardless ing a vote may be too much.” Time to Go Short on of whether companies or unions chip In the arm wrestling that sometimes Wall Street Lobbyists in new money as a result of Citizens characterizes the relationship between United, election ads likely will begin to Congress and the Supreme Court, com- ▶ The White House wins one in surface in late summer. The business panies’ ability to act incognito under the drive for fi nancial reform and fi nance lobbies are expected to try the auspices of industry groups could to chip away at the Democratic majori- disappear. Democrats are preparing ▶ “If you want to be a bank, then you legislation in response to Citizens United need to be a bank” that would require unions and business groups to identify who pays for ads de- The high-profi le government investiga- signed to sway voter opinion. Charles tion of Goldman Sachs seems to have Quoted E. Schumer of New York, a co-sponsor, defanged Wall Street’s once-formidable “It is not often you come says he already has broad Democratic lobbyists, at least temporarily. On across an issue where people backing in the Senate. He may not have Apr. 21, the Obama Administration of all political stripes come far to look for Republican support: Four moved forward in its campaign to tight- together so stridently.... GOP senators—Susan Collins and Olym- en the rules governing the fi nancial Taxpayer bailouts of CEOs and pia Snowe of Maine, Richard Lugar of industry when a Republican senator, companies is such an issue.” Indiana, and John McCain of Arizona— Charles Grassley of Iowa, broke party —— Gop consultant Frank have criticized Citizens United. ranks to vote with Democrats to impose luntz, in a January memo advising The Chamber of Commerce’s general strict limits on derivatives trading. republicans how counsel, Steven Law, says the Supreme In a 13-8 tally, the Senate Agriculture to talk about Court’s assertion of corporate speech Committee sent the derivatives measure fi nancial reform rights would be turned on its head by to the fl oor. It would require, ➡ the bill Schumer is drafting with Mary- among other things, that 42 iMaGes neWs/Getty Daily braMhall/ny bill by illustration (Cartoon) notiMeX/neWsCoM; by photoGraph (bottoM) April 26 — May 2, 2010 Bloomberg Businessweek Charlie Rose talks to Rahm Emanuel
How would you describe President tensions. And that could be also said Obama’s philosophy about the role about some on the left. of government? Well, he is a pragmatist. He has adopted Would we be better off today, ideas and policies from Republicans with lower unemployment, if the and Democrats. He is not wedded Administration had just focused on to a philosophy or ideology. He sees the economy? government mainly for setting rules and I don’t think the recovery would be in a then letting the private sector operate stronger position. [The President said] within those rules. we can go from every bubble you want to every bust you want, or we can lay a How deep is the anger in America? new [economic] foundation. I think it’s deep, [but] there are a lot of factors that go into that, principally eco- Is the Democratic Party in trouble in nomic anxiety. We’re in the middle of a the election coming up? The President’s Chief of Staff severe economic transition. Yeah, it’s got challenges. talks about the prospects for Can Obama turn around the anger With unemployment at 9.5% or 10%, financial reform and middle- of people who think they haven’t will it lose the Congress? class anger in an edited version been heard? Unemployment is important. But if 41 of an Apr. 19 TV interview There are legitimate reasons for the people think the economy is getting anger out there. The middle class has better, and we make this a choice about seen their incomes lost and cost of living what led us into the recession and the Will you get Republican votes for go up while those at the top acted with set of policy changes we made to help financial reform? a sense of irresponsibility that led to the lead us out, I think we have a chance of Yes. I think it will be bipartisan be- economic crisis. Now the hard-working turning this election around. cause people realize we have a financial middle class is bailing out [the econo- system that over the last 20 years has my]. Anybody who thinks the anger is Is there any other job in government raced ahead of the regulatory system. just being pumped up, doesn’t get it. you’d like to have? We have a multi-trillion-dollar section Let me say it this way: I hope Mayor of the financial marketplace without an You’ve got to listen to the people. [Richard] Daley seeks reelection. I will agency that oversees it. I mean, Warren Yeah. Representative democracy work and support him if he seeks reelec- Buffett … has talked about derivatives as [means those who are angry] have to be tion. But if he doesn’t, one day I would the equivalent of a nuclear bomb in the heard, too. When you have a leadership like to run for mayor of Chicago. That’s financial sector. Take a look at how de- role, you have a responsibility … to let always been an aspiration of mine. What rivatives have exploded in scope, scale, disagreements flourish without letting I miss is being in touch with people. and size. And yet nobody knows what’s those disagreements touch something going on. They happen in the shadows on the darker side. Everybody is ac- When might we have a Supreme of the financial industry. It is unhealthy countable, including the media. Court nominee? to not bring in some standardization The President nominated Sonia Soto- and transparency. Even people in the in- Are you angry about the media? mayor at the end of May [2009], dustry believe that should happen. No. But sometimes the media doesn’t and the Senate confirmed her the first act with the full responsibility that week in August, so that’s kind of your Does the SEC complaint against comes with its position. They play a role time frame. Goldman Sachs make the case for in exacerbating the sense that America’s reform easier? pulled apart, and it’s not as pulled apart Do you expect a confirmation battle Look, the same forces that were op- as is being reported. in the Senate? posed to [reform] are still opposed to it. There will be a huge, huge battle.
➡ House offi andtheirassociates. cials profi le exits by yearend.Belowis ahandicapper’s guide to departures, basedon interviews with top White most comprehensive experience inyour life.” Presidentlikely means Obamais This to seesomehigh- last 18months, ” says Erskine Bowles, aformer chiefofstaff to President Clinton .“It’s themost exhausting, A White House acareerpinnacle,but jobis betoo much itcan sometimes ofagood “Most thing. people Reshu einObamaLand? The Administration Wall Street may not beableto halt Grassley’s support ofabroader bill would leave replace him houses to process deals and collect houses to process andcollect deals Wall Street traders useclearing- Probability Who might by yearend of leaving matters Why he Why he went to press, hewas setto after theficrisis. nancial to theeconomy right playercrucial inhelping Hebrain was trust. a economic leader ofhis himasthe Obama sees Director Jason Furman. Deputy nomic Council Partners; National Eco- ofEvercoreco-chairman Blinder; Roger Altman, Ex-Fed Governor Alan chairmanship . get thecoveted Fed role, andhedidn’t White Househis he’s unhappy about told that friends Summers, 55, has Economic Council Director, National Larry SummersLarry 60 Bloomberg % —— care bills. stimulus andhealth- architect ofthe policy budget andwas akey $3.8 fi trillion 2011 scal He prepared Obama’s Robert Reischauer. Institute President Urban Policy Priorities; onBudgetthe Center & Greenstein, director of hawks:Fiscal Robert hestay.Obama insisted about to leave when salaryjob—and . He was desire aprivate-sector New York; at 41, hemay second wife lives in Orszag’s soon-to-be Much to thehorror ofbank lobbyists, beyond what theWhite House sought. the derivatives measure, which goes summer, this cratic primary sponsored culture atough panelandfaces Demo- Arkansas Democratwho headstheagri- Senator BlancheLincoln,themoderate Democrats andRepublicans.business Washington days these amongpro- ofMaryland SchoolofLaw.ty sion andnow aprofessor at theUniversi- Futures Trading Commis- Commodity Greenberger, aformer offi at the cial derivativesthis proposal,” says Michael bying ofexemption for somesort in ago, AIGwould have beenuphere lob- reform “Threeyears as ithasinthepast. Hans Nichols andJulianna Goldman Management &Budget Director, Office of Wall Street hasfarfewer in friends Peter Orszag 50 % tech toys. speculative, costly high- Pentagon to give up in Iraq, andforced the ledaturnaroundtrust, He Obama’s hasearned Hagel (R-Neb.). former Senator Chuck family reasons, or who could demur for ator Jack Reed (D-R.I.), Obama may turnto Sen- drawals inJuly 2011. fi rst troopAfghan with- but may stay untilthe Seattle homenear his 66, eager is to retreat to wars since2006, Gates, After managingtwo Robert Gates 40 Secretary Secretary Defense % would jumpin. likely will—Emanuel, 50, say friends 2011—and he Daley d oesn’t runin cago Mayor Richard M. until mid-2011. IfChi- stay probably He’ll health-care reform.health-care the stimulus planand toning strategies pass win- Devised decades. ful Presidential in aides One ofthemostpower- visor. ad- national security Tom Donilon,deputy uel aidePhilSchiliro; leader; Eman- majority Tom Daschle,ex-Senate momentum forregulation broader overhaul. derivatives billsuggests President may Obama have The bottom lineAGOP senator’s support for atough its. Goldman, ance Corp. protection ontheirdepos- ing desks orloseFederal DepositInsur- banks to spin off theirderivativestrad- Lincoln’s planwould force commercial America , America —— Phil Mattingly news conference before thevote. a bank,” Lincolnsaidat aWashington want thenyou to beabank, needto be derivativecurrency trading.)“Ifyou posal would letTreasury exempt foreign through theFederal Reserve. (Her pro- fi cheap be ableto tap nancing available tives are amajor profi tcenter would not Rahm Emanuel 30 White House Chief ofStaff andotherbankswhere deriva- % JPMorgan Chase of, Bank cmag strategist. campaign likely willbeatop 2012 ship withObama.He relation- personal savvypolitical and Nobody elsehashis manager David Plouff e. or former campaign RobertSecretary Gibbs insiders such asPress turnto trusted certainly Obama would almost to stay until mid-2011. in Chicago. He likely is wife, Susan, remained little downtime . His the White House with from to thecampaign Axelrod, 55, went right David Axelrod Senior Advisor 20 White House %
(l to r) brenDan sMialoWsKi/blooMberG; ron saChs/polaris; Manuel balCe Ceneta/ap photo; aleX WonG/Getty iMaGes; aleX branDon/ap photo April 26 — May 2, 2010 Bloomberg Businessweek James Warren For Health Care to Work, These Doctors Need a Big Raise
so it was done. Its 2010 recommendation al matter. Some dermatologists just love could have just as much impact: Increase skin diseases. Others may like money. A the number of primary-care physicians— family physician or general internist av- and pay them a whole lot more. erages about $160,000 a year, according To understand why this makes sense, I to the nonprofit Robert Graham Center, followed the council chairman, Dr. Russell which researches primary care. A spe- Robertson, during his volunteer rounds at cialist averages $267,000. That means CommunityHealth, the largest free clinic the general practitioner will earn about in Illinois. It serves a poor, uninsured cli- $3.5 million less over a lifetime. entele of mostly Latinos and Poles—many Medicare determines the baseline for undocumented, nobody asks—in a diverse doctors’ pay, and since most medical stu- working-class section of Chicago. dents elect to train in the non-primary- Robertson, the chairman of family care jobs generating the majority of charg- and community medicine at the Feinberg es, procedure-oriented specialists end up School of Medicine at Northwestern Uni- the winners. Medicare finances the system versity, spent 2½ hours treating five pa- via direct subsidies to pay residents’ sal- 4443 tients with chronic multisystem diseases: aries and indirect payments to hospitals hypertension, diabetes, high cholesterol, for tests and other duties fulfilled by res- obesity, and depression. A rotten econo- idents. There’s no inherent logic to the my spawned a 33% surge in patients last payments. Some New York City hospitals year, for a total of 22,000 visits. The wait get over $200,000 per resident. Robert- Specialists earn $3.5 million for an appointment with one of the clin- son’s gets $60,000. more, on average, than general ic’s 300 volunteer doctors is six weeks. Other factors affect the general prac- One thirtysomething man needed an- titioner shortage, from a med school cul- practitioners over the course of tidepressants and a social worker. An- ture that considers it more glamorous to a career. A federal panel wants other patient was off her medication for be an orthopedic surgeon or anesthesiol- to reduce the discrepancy high blood pressure. A third had constipa- ogist—not to mention more advantageous tion tied to a thyroid condition. A 19-year- to pay back student loans—to the media’s old woman was panicked by a sister with fascination with obscure diseases. (Good- The DoubleTree Hotel in Bethesda, Md., is multiple sclerosis and, after her father’s bye Marcus Welby, M.D., hello House.) The an odd place to get beyond the utter irrel- death from a heart attack, became con- result is a system ill suited to our needs. evance of much of the health-care debate. vinced she also had heart problems and The panel is calling for a 40% hike in Yet on Apr. 22 and 23, as Bloomberg Busi- MS. Robertson gave her an electrocardio- the number of primary-care doctors— nessweek went to press, the Council on gram, antidepressants, and reassurance. and a 40% income increase for those en- Graduate Medical Education, a little- None of these conditions is imminent- tering the field. That should get general known federal panel, was set to recom- ly life-threatening or makes for particu- practitioners to within 70% of the median mend a dramatic change in the doctor larly sexy medicine. Yet when the Obama income of specialty physicians. “Policy workforce that treats Americans of all po- health plan kicks in and a wave of newly changes should be dramatic to remedy litical parties. insured patients goes for treatment, the these legacy biases and have immediate The council was created—and statu- system will be congested with these kinds effect,” states a council draft. torily mandated—in 1981. It’s made up of of rudimentary ailments. Primary-care I talked to Robertson again on a day a cross section of physicians, including doctors comprise 32% of the physician when he saw four more patients. He per- representatives from the private sector, workforce. Factor out pediatricians and sonifies selflessness, yet at the end of the academe, the Veterans Affairs Dept., and just over 23% of doctors deal with adults, day he admitted his frustration. “Primary
Medicare. The council’s reports are taken and that number is shrinking, says the care is the bargain of the century, given bar a seriously by the private sector and gov- Altarum Institute, a nonprofit health-care that prevention and maintenance is a ernment; in 1997 its members suggested consultancy. whole lot cheaper than intervention,” said a cap on the overall number of medical Why doctors choose to practice gen- Robertson. It should be “like motherhood residents as part of federal cost cuts. And eral medicine or specialize is a person- and apple pie.”