Meet John McCain's Pals

Menachem Rosensaft. Posted October 20, 2008 | 08:33 AM (EST)
Ok, who would you like to see alongside the next President of the United States in a crisis, Warren Buffett or Phil Gramm? General Colin Powell or Randy Scheunemann? Paul Volcker or Nancy Pfotenhauer? We know a great deal about Powell (Republican former Secretary of State, former National Security Advisor and former Chairman of the Joint Chiefs of Staff), Buffett (CEO of Berkshire Hathaway, one of the richest and most successful influential businessmen in the world), and Volcker (former Chairman of the Federal Reserve), all prominent Obama supporters, but what do we know about some of the luminaries who have John McCain's ear?

First and foremost, there is Phil Gramm, the former Chairman of the Senate Banking Committee, whom Nobel Economics Laureate Paul Krugman has called "McCain's guru on economics," and whose deregulation of the banking industry not only enabled banks to go into the subprime mortgage business in the first place, but made possible the "gimmicks" - hybrid instruments, credit swaps and the like - that McCain now rails against. Krugman famously described Gramm in his New York Times column as "the arch-deregulator, who took special care in his Senate days to prevent oversight of financial derivatives -- the very instruments that sank Lehman and A.I.G., and brought the credit markets to the edge of collapse." Gramm, we should all remember, was McCain's most prominent and influential economic adviser until earlier this summer when he dismissed the state of the economy as a "mental recession" and called Americans a "nation of whiners."

McCain has been "palling around" with Phil Gramm for decades. The two are close personal friends, and McCain was national chairman of Gramm's short-lived 1996 bid for the Republican presidential nomination.

And then there are the lobbyists. The neo-con Randy Scheunemann, McCain's chief foreign policy adviser, was a registered foreign agent for the Republic of Georgia and several other countries while simultaneously serving as McCain's senior foreign policy advisor. (Scheunemann also has close ties to the discredited Iraqi politician, Ahmad Chalabi.) In November 2007, Scheunemann discussed Georgia with an aide in McCain's Senate office. And according to the Washington Post, on the same day that Scheunemann was prepping McCain for a telephone call with Georgia's president in April of this year, Scheunemann's lobbying firm signed "signed a $200,000 contract to continue providing strategic advice to the Georgian government in Washington." Both McCain and Sarah Palin have made American support for Georgia a cornerstone of their foreign policy. Palin told Charles Gibson in her ABC News interview that she considered the Russian invasion of Georgia to have been "unprovoked," and that the United States might have to go to war against Russia to protect Georgia. Not surprisingly, Scheunemann was one of the McCain advisers who prepped Palin for the Gibson interview. As Kelley Beaucar Vlahos recently asked in The American Conservative (hardly a left-wing publication), "When McCain suggests there will be 'severe, long-term negative consequences' for Russia if it doesn't leave Georgia alone, how do Americans know that isn't the $800,000 Scheunemann's lobbying shop has gotten from Georgia since 2004 talking?"

Charlie Black, McCain's chief campaign adviser, is a long-time lobbyist for Colombian interests, as are numerous major contributors to the McCain campaign. The lobbying firm Black headed until earlier this year earned more than $1.8 million from Occidental Petroleum Company, Colombia's largest oil and gas producer, and has represented numerous other Colombian businesses and individuals. According to the New York Times, Black

"lobbied Congress, the State Department and the White House on Occidental's behalf regarding 'general energy issues' and 'general trade issues' involving Colombia. His list of activities also included winning 'foreign assistance for Colombia' and efforts to block an economic embargo against the country, which has a questionable human rights record."
Small wonder, then, that McCain considers the Colombian Free Trade Agreement "something that's a no-brainer." McCain's instinctive position appears to be that what's good for his lobbyist pals must be good for the United States. This is the same Charlie Black, incidentally, who told Fortune Magazine in June that another terrorist attack on U.S. soil "would be a big advantage" to McCain, and who masterminded Jesse Helms' racist 1990 North Carolina senatorial campaign against Harvey Gantt.

Still others in the McCain entourage have close ties to the mortgage industry. Campaign Manager Rick Davis used to head the Homeownership Alliance, an advocacy group on the behalf of Fannie Mae and Freddy Mac, and Davis Manafort, the lobbying firm that still bears Davis' name, received monthly $15,000 payments from Freddie Mac until August of this year. And Kurt Pfotenhauer, the husband of McCain's senior policy adviser Nancy Pfotenhauer, was the top lobbyist for the Mortgage Bankers Association. The telegenic Nancy Pfotenhauer is also a former Washington lobbyist for Koch Industries whose Koch Oil subsidiary was once cited by a Senate Committee as "the most dramatic example of an oil company stealing by deliberate mismeasurement and fraudulent reporting." Only a few days ago, Ms. Pfotenhauer said that while the Obama-Biden ticket was doing well in Northern Virginia, "the rest of the state, real Virginia, if you will, I think will be very responsive to Senator McCain's message." She apparently believes that the upstate part of the Commonwealth of Washington, Jefferson, Madison and Monroe has somehow turned into a "fake" Virginia.

Davis has another questionable accomplishment to his credit. According to the Washington Post, he "helped arrange an introduction in 2006 between McCain and a Russian billionaire whose suspected links to anti-democratic and organized-crime figures are so controversial that the U.S. government revoked his visa." No one has suggested that McCain ever did any improper favors for Oleg Deripaska, the billionaire in question who just happens to be, again according to the Washington Post, "one of the richest men in Russia and a close ally of President Vladimir Putin." Nevertheless, the very fact that McCain had dinner and drinks, that is, "palled around," with the controversial Deripaska at least once less than three years ago at an exclusive Swiss resort (seven months later, in August 2006, McCain allegedly had dinner again with Deripaska and Davis in Montenegro) is at least as noteworthy as what Colin Powell has called Barack Obama's "very, very limited relationship" with Bill Ayers on the board of a respected Republican-funded educational foundation in Chicago.

At last week's debate, Barack Obama told us that he would look for guidance and advice to individuals like Warren Buffett, Paul Volcker, Joe Biden, and Richard Lugar, the ranking Republican on the Senate Foreign Relations Committee. We must assume that Phil Gramm, Randy Scheunemann, Charlie Black, Rick Davis and Nancy Pfotenhauer would figure prominently in a McCain-Palin administration. Is there anything else anyone needs to know before going into the voting booth?

Menachem Rosensaft is a lawyer in New York City