The White House’s newest staffer is John Podesta, the 64-year-old founder of the Center for American Progress (CAP), the head of President Obama’s 2008 transition team, a former chief of staff to President Clinton, and a former lobbyist and co-founder, with his brother Tony, of the Podesta Group. You know: an outsider.
Podesta is joining the administration for one year as a White House counselor specializing in energy policy. And despite the fact that he has done more than any other unelected official to shape the policies of cap-and-trade and green-energy subsidies, and to employ and place the talent that has attempted to implement those policies during the Obama presidency, the White House assures us that he will never, never have any say in whether the Keystone pipeline, slow-walked by this president for years, is approved or denied.
“John suggested that he not work on the Keystone Pipeline issue,” a White House aide e-mailed Ryan Lizza of The New Yorker, “in review at the State Department, given that the review is far along in the process and John’s views on this are well known.” Podesta opposes the pipeline vociferously, because he says it will exacerbate global warming. But if his opposition to Keystone disqualifies him from working on the issue in the West Wing, wouldn’t that also be a problem for his seat on the Foreign Affairs Policy Board at the State Department, where the pipeline issue is “in review”? Or for his seat on the Secretary of Energy Advisory Board, which must have discussed the pipeline at some point? And does anyone besides the gullible greens at Credo Action, the political arm of a cell-phone company that provides its customers feelings of moral superiority, really believe Podesta will be “silenced” when it comes to “what may be the single most closely watched decision of the Obama presidency”? Does anyone who has ever interacted with Podesta or his brother believe either man is capable of silence?
#ad#The recusal controversy is a joke. There isn’t any need for Podesta to “work” on the “Keystone Pipeline issue” because everyone in the White House, which he has visited some 130 times since 2009, knows where he stands on it. His work is already done. And it was good work — if you are part of the 30 percent minority that disapproves of laying the pipe. Fearing his wealthy environmentalist donors, President Obama has consigned Keystone to bureaucratic purgatory. This is one decision point he is unlikely to reach, allowing Podesta to spend more time on his pet cause of declassifying files of UFO sightings.
Engrossed in a technical and superfluous discussion of the meaning of “recusal,” the press, as usual, has missed the real story. It is this: Podesta is the vehicle through which a radical billionaire’s energy policies are about to enter the Oval Office. I am speaking of Tom Steyer, the incredibly wealthy hedge-fund manager who retired from his firm, Farallon Capital Management, in the fall of 2012 for a second career in political activism. Long a donor to Democratic campaigns, like many liberals Steyer has become obsessed by global warming, and sees the Keystone pipeline as a metaphor for whether Americans are serious about, and are committed to stopping, the rise in global temperatures. (Temperatures that have been flat for the past 15 years.)
Steyer is also a pioneer in the dark-money universe of post-Citizens United campaign finance. He is one reason Democratic super PACs outspent Republican ones two-to-one in 2013. He has bankrolled ballot initiatives in California, helped defeat the pro-Keystone and pro-labor Democrat Stephen Lynch in the Massachusetts Democratic Senate primary, and most recently spent $8 million in the Virginia governor’s race electing Terry McAuliffe. That, according to Politico, is “more money, on a per-vote basis, than the famously prolific conservative donors Sheldon and Miriam Adelson spent in the 2012 presidential election.” But it is also a pittance of Steyer’s $1.5 billion fortune.
The relationship between Tom Steyer and John Podesta is longstanding. Steyer is on the board of the Center for American Progress, and in the early months of 2012 he and Podesta co-signed a Wall Street Journal op-ed, “We Don’t Need More Foreign Oil and Gas,” arguing against Keystone and for subsidies such as the Production Tax Credit, increasing the value of the green-energy companies in which Steyer invested and on whose boards Podesta sat. Farallon also had a major stake in Kinder Morgan, whose pipeline business would be hit if Keystone were ever approved. In July of this year, months after he “retired” from his fund, and under criticism from Senator David Vitter (R., La.), Steyer directed Farallon to sell his Kinder Morgan investments and pledged that he would donate his gains to charity. Meanwhile he was putting the rest of his money to work, investing in candidates and independent expenditures directed toward defeating Keystone once and for all. But it’s not like he can do all of this alone. A September New Yorker profile mentioned Podesta, “who is now an adviser to Steyer.” Paid or unpaid, the article did not say.
In my imaginary world the Washington press corps would find it provocative and worthy of investigation that an adviser, colleague, intellectual guru, and fixer for one of the country’s most powerful men had landed a job within earshot of the president of the United States. But one has to face the reality that John Podesta has transcended the day-to-day understanding of the phrase “conflict of interest,” and so embodies the contradictions and self-dealing and ambition of the nation’s capital that the normal journalistic reflexes of curiosity and skepticism are rather sublimated. His position at the apex of the D.C. nonprofit heap insulates him from scrutiny because the knee-jerk literalism of political enthusiasts often equates “nonprofit” with a lack of profit motive or avarice. Not so.
“Podesta has no financial interest in the Keystone XL decision,” says Credo Action. Is that truly the case? I am not saying that John Podesta is directly invested in companies that will profit if Keystone is defeated. What I am saying is that the connections between VIPs and think-tank donors and corporate boards and lobbying clients are hard to disentangle. It is so easy for a reporter to lose the thread, especially when that reporter is already inclined to think that the motives of his subject are pure. Podesta’s fame and power have certainly helped line the pockets of his brother, for example. The Washington Times reports that the Podesta Group’s income grew from $10 million in 2007 to as much as $30 million in 2010, with 2013 revenue “estimated to be around $20 million.”#page#
John’s compensation is a trickier matter. His business relationships are not as formalized or as regulated as his sibling’s. His various postings and seats and memberships and appointments are hard to pin down. An article in Friday’s New York Times cites a Podesta aide “working with him on the disclosure report he is preparing.” That report soon will be the hottest read in Washington. Podesta’s not a monk. In addition to his role advising Steyer, and the $200,000 he receives in compensation from CAP, he sits on the board of Portland-based Equilibrium Capital — in which he also had “a small ownership stake” — advises government contractor Gryphon Technologies for $100,000 a year, and was paid $90,000 this year consulting for the HJW Foundation, which also gives money to CAP. And he is a member of the board of directors of Joule, a Massachusetts-based energy company that is “developing a revolutionary platform for renewable fuel and chemical production that is expected to eclipse the scalability, productivities, and cost efficiency of any known alternative to fossil fuel today.” John Kerry appears in a photo on the “about us” section of the company’s website. Joule knows who powers its batteries.#ad#
Podesta has revolutionized the influence game by giving it the patina of intellectual respectability. Traditional lobbying has become blasé; it’s much better, much nobler, to enlist corporate “partnerships” in the progressive cause. As first reported by The Nation, the Center for American Progress has a number of corporate sponsors that pay hundreds of thousands of dollars to join its “Business Alliance.” In return for payment these corporations gain access to the center’s scholars, its leadership, and its events with major Democratic officials. On Friday CAP released a list of its 2013 “corporate supporters,” including multinationals such as Citigroup and Coca-Cola and Daimler and Samsung; firms such as Albright Stonebridge and McLarty Associates and the Livingston Group that represent foreign interests; and affiliates of foreign governments such as the Taipei Economic and Cultural Representative in the United States and the Japan Bank for International Cooperation.
“I don’t think he even knows who our corporate supporters are,” CAP president Neera Tanden laughably told Politico. Would she have told her corporate supporters that prior to this week? A June 2012 document leaked to The Nation revealed that, in the energy sector alone, Podesta’s think tank took money from, in alphabetical order, American Electric Power, the American Wind Energy Association, Anglo-American, Constellation, Covanta, Dow Corning (Silicone Manufacturing/Solar), Duke Energy, Enel Green Power, First Solar (Solar Manufacturing), First Wind, PG&E, Talisman, Westport Power, and Xcel Energy. All of them must feel pretty lucky that Podesta will be specializing in their field during his upcoming White House tour.
In 2012, Business Alliance members from the health-care sector — another item in Podesta’s White House portfolio — included Blue Shield of California, CareFirst Blue Cross/Blue Shield, Castlight Health, Eli Lilly, Heath Care Service Corporation, Novo Nordisk, Quest Diagnostics, and United Healthcare Group. Let’s play a game: How many major corporations do you believe will join the Center for American Progress Business Alliance in the coming months? I’m putting the over-under at a baker’s dozen.
In its announcement of Podesta’s job at the White House the New York Times described CAP as “a center-left public policy research group that has provided personnel and policy ideas to the administration.” That’s selling it short. CAP is also a revenue machine, a $39 million ATM into which corporations and lobbying firms and foreign governments deposit funds and withdraw influence and alliances. John Podesta has a financial interest in building and maintaining that machine, in fine-tuning it, in expanding the list of depositors and the value of their withdrawals. And his depositors in the world of alternative energy, the dreamers as much as the investors and manufacturers, have a financial interest in limiting the market share of carbon-heavy extractive industries.
What the hiring of Podesta reveals is the triumph of one class of capitalists over another, the capture of political office by the post-material green investors in solar, wind, natural gas, and switch-grass, and the weakening of the captains of coal and oil. In the case of coal the blow may be devastating. Thanks to Harry Reid’s ending the filibuster for judicial appointments, the D.C. Circuit Court of Appeals is tilted toward Democratic judges likely to uphold carbon regulations issued by the Environmental Protection Agency in the coming year, regulations that will knock King Coal off his throne. Podesta will direct the regicide from the Old Executive Office Building.
Teeming with guile and energy, Podesta’s life story is an impressive one. His career, and the career of Tom Steyer, demonstrates the upsides of investing in the political market. The rewards there are just as great as in the private sector. And as long as you drape your self-interest in the finery of bourgeois liberalism, no one will question your motives. And no one will question your money.
— Matthew Continetti is the editor-in-chief of the Washington Free Beacon, where a version of this column first appeared. © the Washington Free Beacon. All rights reserved.