Opinion: All About the Lobby — Linking the Mueller Indictments to a Tax Overhaul

Desperate for a win, the GOP is not sweating the small — or big — stuff

Republican presidential nominee Donald Trump, with campaign manager Paul Manafort and daughter Ivanka Trump at the Republican National Convention in Cleveland in July 2016. (Bill Clark/CQ Roll Call file photo)
Republican presidential nominee Donald Trump, with campaign manager Paul Manafort and daughter Ivanka Trump at the Republican National Convention in Cleveland in July 2016. (Bill Clark/CQ Roll Call file photo)
Posted October 31, 2017 at 5:03am

There’s something ironic about President Donald Trump promising to “drain the swamp,” three of his campaign aides getting indicted, two of those aids facing federal charges related to their work as lobbyists for a foreign government, and Congress barreling ahead to pass tax reform all in the same week.

If the events seem unrelated, they’re really not, because the entire illegal scheme that special prosecutor Robert Muller described in the indictments of Paul Manafort and Rick Gates on Monday had one ultimate goal — to influence members of Congress, in this case on matters related to the government of Ukraine.

The breadth of the efforts that Manafort and Gates allegedly went to in order to sway opinions in Congress is stunning. They created shell companies and offshore accounts to hide their work and lobbying income, did extensive lobbying themselves, spent millions of dollars paying other lobbyists, and failed to disclose any of their work on the federal reports required for anyone acting as an agent of a foreign government. Manafort and Gates also allegedly hired Democratic super lobbyist Tony Podesta to meet with members of Congress on behalf of a Brussels-based non-profit that seemed unrelated to Ukraine but advocated the same positions as the Ukrainian government in front of Congress under the concealed direction of Manafort and Gates.

The indictment is specific and damning for everyone involved, including a Congress that Ukraine believed could be so easily manipulated it would be worth the tens of millions of dollars to pay Manafort and Gates and others to do it. There is no mention of which members of Congress and their staffs were targeted, but it’s clear from the language that many were.

“At the direction of MANAFORT and GATES, Company A and Company B engaged in extensive lobbying,” the indictment says. “Among other things, they lobbied multiple Members of Congress and their staffs about Ukraine sanctions, the validity of Ukraine elections,” and several other issues. The indictment also says Manafort and Gates both lobbied in connection with the rollout of a report commissioned by Ukraine and secretly paid for by Manafort and Gates.”

The tax connection

Just as the indictments were being finalized last week at the Justice Department, the House was busy passing next year’s budget, a key step toward moving on to tax reform. Of all pieces of legislation this year, the chance to overhaul the tax code is the most anticipated by Republicans, who have made careers out of cutting taxes and, in theory, balancing budgets.

That the House-passed budget allows for adding up to $1.5 trillion to the deficit over the next ten years is an early tell that this bill is not only something Republicans want to pass, it’s something they’re so desperate to pass they’re not going to sweat the small stuff — or the big stuff — to get it done, and fast. Because next year is a key mid-term election year, Senior Republicans acknowledge they could be facing a bloodbath without at least one accomplishment like tax reform to take to voters. So the goal is to get tax reform done by the end of the year.

The must-pass nature of tax reform, along with the velocity GOP leaders want, as well as the complexity of any bill that seeks to change even a small piece of the tax code, have combined to create a frenzy among Washington lobbyists looking to get something in, on, or out of the bill.

The National Association of Homebuilders told Bloomberg News it’s “at DEFCON ONE” in its efforts to get language into the bill related to a tax deduction for mortgage interest and state property taxes. They’ve already spent $3 million this year alone to lobby on tax reform and it’s safe to say they’re not done yet.

Other intense lobbying efforts have changed the bill even before it’s to be released on Wednesday — state and local taxes were set to be taken away as deductions, but now property taxes, at least, are back in. Likewise, 401(k) contributions were on the outs for special treatment, but a tweet from Trump changed that math quickly.

Overhaul redux

It’s all familiar to anyone who was around the last time Congress tried to really reform the tax code. Lobbying leading up to tax reform in 1986 tax reform was so intense that the iconic book about how it all went down was appropriately titled “Showdown at Gucci Gulch,” describing the bill at its heart as ultimately a battle between literally well-heeled lobbyists and the clients who were paying them.

Then, like now, every change for one special interest triggered lobbying from a half dozen more in the opposite direction, with companies and individuals spending millions all to influence one vote, or a handful, of members of Congress on a single piece of legislation.

The reality is very little in Washington has changed since 1986 or 1886. All roads still lead to the Capitol, literally. The center of the city, the only space without a quadrant, is the exact middle of the Capitol Dome, where the rest of the city radiates from. The geography of the city surrounds it. The economy of Washington is built on it. Changing a mind or influencing a vote is worth whatever a person or a company has to pay to get it done. For men like Paul Manafort and Rick Gates, it seemed to be worth even more than that.

This week proves that, at least from the outside, Washington is still the bipartisan swamp the president had wanted to drain and may even be a more fertile habitat with a new president in the White House and legislation that needs to move. The only people who can change that are members of Congress, who are at the center of every conceivable attempt in the country, and now even the world, to get them to vote according to someone else’s best interest when they’ve taken an oath to act in the best interests of the country. If they could do that one job, the swamp will eventually drain itself.

Roll Call columnist Patricia Murphy covers national politics for The Daily Beast. Previously, she was the Capitol Hill bureau chief for Politics Daily and founder and editor of Citizen Jane Politics. Follow her on Twitter @1PatriciaMurphy.