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Puzder Owes Millions To Bank Seeking Labor Department Waiver

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Trump’s Watered-Down Ethics Rules Allow Lobbyists To Run The Swamp

Reprinted with permission from ProPublica.

Geoff Burr spent much of the last decade as the chief lobbyist for a powerful construction industry trade group. Burr sought to influence a host of regulations of the Department of Labor, opposing wage standards for federal construction contracts, and working against an effort to limit workers’ exposure to dangerous silica dust.

In the Obama administration, someone like Burr would have been barred by ethics rules from taking a job at an agency that he had lobbied.

In the Trump administration, Burr now has a top job at the Labor Department.

Burr is the first publicly known example of a former lobbyist who was able to take a job in the government as a result of President Donald Trump’s watering down of ethics rules in place during the Obama administration.

As a candidate, Trump regularly railed against lobbyists and led crowds in chants of “Drain the swamp!” But as president, Trump last month signed an executive order that weakened significant aspects of the Obama ethics policy, including scrapping a ban on lobbyists joining agencies they had recently lobbied.

Ethics experts say Burr’s hiring is a troubling example of how the new administration has greased the revolving door.

“A lobbyist like Burr may de-register on Monday and enter the Trump Administration on Tuesday,” said Craig Holman of the watchdog group Public Citizen. “The very same agency Burr has been lobbying as a hired gun is now Burr’s to help run. This is a grave problem for the public because the agency may well represent the special interest rather than the public interest.”

It also raises questions about ambiguous language in the Trump executive order.

Instead of banning lobbyists from working at agencies they lobbied, the Trump pledge, which has to be signed by all executive appointees, imposes restrictions on what such officials can work on. Specifically, it says they cannot “participate in any particular matter on which I lobbied … or participate in the specific issue area in which that particular matter falls.”

Ethics lawyers are now puzzling over what exactly that language means.

That task is made more confusing because of an apparent error in the Trump executive order: It says the phrase “particular matter” has the “same meaning as set forth in section 207 of title 28, United States Code.”

That part of the U.S. code does not exist.

There is a definition for that term in section 207 of title 18. (The error is doubly strange because much of the Trump executive order was copied word for word from an earlier Obama order. The White House didn’t respond to a request for comment.)

While it was cited incorrectly, the phrase “particular matter” does have a clear legal meaning, which has been detailed by the Office of Government Ethics.

Another phrase in the Trump order, “specific issue area,” was also used in the Obama order but its meaning is unclear.

“It is not defined in the Trump pledge. There’s uncertainty within the government and outside the government about what that particular term means,” said Robert Walker, an ethics lawyer at Wiley Rein in Washington. “The same lack of clarity was a problem with the Obama pledge in this area.”

Because the Obama pledge included a blanket ban on lobbyists joining agencies they recently lobbied, the ambiguity of the restrictions on what lobbyists could do was less urgent.

The Obama administration was criticized for issuing a handful of waivers to allow former lobbyists to join the administration, thus skirting its own lobbyist ban. Out of thousands of appointees, there were five such waivers over the course of the Obama administration. None were at the Department of Labor.

Because Trump weakened the Obama rules, he won’t have to issue waivers in such situations. But if Trump issues a waiver allowing, say, a former lobbyist to work directly on issues that he lobbied on, we may not even find out about it: The executive order removed the mechanism for public disclosure of such waivers.

In the case of a former lobbyist like Burr, who worked at the Associated Builders and Contractors, there was a consultation with a Labor Department ethics lawyer. “If recusals were deemed to be necessary, it’s likely that there would be some documentation of the contours of those recusals,” Walker said.

Department of Labor spokeswoman Jillian Rogers declined to detail how Burr will comply with the ethics order. She offered the following statement:

“Mr. Burr has signed the Ethics Pledge and received a full ethics briefing on his first full day at the Department. He has been in frequent consultation with the DOL Ethics officer to ensure he is fully compliant with all ethical obligations in his role at the Department.”

Enforcement of the Trump’s ethics rules will also be at the discretion of the administration, as it was with the Obama order.

Whether Burr’s work at the Labor Department will be significantly limited by the president’s ethics rules depends on how the administration interprets the order.

Burr is now a member of the so-called beachhead team at the agency and is reportedly in line to be chief of staff to Labor Secretary nominee Andrew Puzder.

That role is shaped by each labor secretary’s needs, according to Seema Nanda, who was chief of staff through January 20 of this year.

Under Obama Labor Secretary Tom Perez “anything significant that is happening in the department or anything that is a change in policy you are discussing as chief of staff,” Nanda told ProPublica.

That includes reviewing documents that need the secretary’s signature, such as new regulations, reports to Congress, or letters.

The chief of staff and his or her deputies “regularly meet with the agency heads to see what they’re thinking about. You are really going over in depth what each agency is working on.”

IMAGE: Alex Proimos / Flickr

Senate Panel Finally Receives Ethics Filings For Labor Nominee Puzder

WASHINGTON (Reuters) – The U.S. Senate panel tasked with vetting labor secretary nominee and fast-food executive Andrew Puzder will hold his confirmation hearing on Feb.16, now that his ethics paperwork has been submitted to Congress, a committee spokesman said Wednesday.

Puzder’s certification from the Office of Government Ethics arrived at the Senate Committee on Health, Education, Labor, and Pensions exactly two months after Puzder was nominated to the job by President Donald Trump.

A spokesman for Puzder, George Thompson, said he expects that Puzder will turn in a separate questionnaire to the committee by Thursday morning.

Puzder is the chief executive officer of CKE Restaurants Inc, which owns primarily franchised restaurants including Carl’s Jr. and Hardee’s.

Tentative plans for Puzder’s hearing have been repeatedly postponed amid delays with a review by the Office of Government Ethics.

Those stem from the complexities surrounding how Puzder will divest himself from CKE Restaurants, which is owned by private equity firm Roark Capital Group.

Other companies in Roark Capital’s portfolio include Corner Bakery, Cinnabon, Arby’s, Carvel, and Auntie Anne’s.

Senate Democrats have been highly critical of Puzder, a staunch critic of an overtime rule championed by the former Obama administration.

His nomination has sparked protests around the country by some CKE fast-food workers and the union-backed “Fight for $15” movement to raise the minimum wage to $15 an hour.

Workers from a number of CKE’s franchised locations have also complained of wage and hour concerns and other labor conditions in recent weeks.

In a letter to Puzder sent on Wednesday before the ethics paperwork was sent to the Senate, the committee’s ranking Democrat, Patty Murray, said she wanted to receive a “detailed account” of his plans for recusals, divestments, and resignations in order to avoid potential conflicts of interest stemming from his business relationship with Roark Capital Group.

“The franchise model’s pervasive presence in the fast food industry, the frequency of serious labor violations connected with franchising and your past or present financial interest in Roark raise questions regarding your ability to faithfully carry out the Department of Labor’s mandate,” Murray wrote.

(Reporting by Sarah N. Lynch; editing by Chris Reese, Leslie Adler and David Gregorio)

IMAGE: Andrew Puzder, CEO of CKE Restaurants, takes part in a panel discussion titled “Understanding the Post-Recession Consumer” at the Milken Institute Global Conference in Beverly Hills, California  April 30, 2012.  REUTERS/Fred Prouser

Trump’s Pick For Labor Secretary Wrote A Deregulatory Manifesto

Reprinted with permission from ProPublica.

Since President-elect Donald Trump’s announcement that he has picked fast-food CEO Andrew Puzder to be labor secretary, there’s been lots of speculation that the administration could undo worker protections.

The single best window into Puzder’s thinking may be an obscure book he wrote six years ago. It’s a blistering attack on business regulations, unions, and the Obama administration’s stimulus and health-care policies.

“I think first and foremost, he’ll put in place everything we laid out in the book,” Puzder’s co-author, David Newton, told ProPublica in an interview.

The 160-page bookJob Creation: How It Really Works and Why Government Doesn’t Understand It — centers on a concept Puzder and Newton dub “The Certainty Factor,” which they argue is key to business expansion and job creation.

“Less federal programs, reduced deficit spending, lower taxes, and cutting back on regulations improve The Certainty Factor,” they write.

If confirmed, Puzder will have power to shape a wide range of regulations that govern unions and employers, many of which are designed to protect workers.

Much of the debate in the Obama years has been around whether to push up the federal minimum wage — which since 2009 has been at $7.25 — to $15. Newton, while stressing he was not speaking for Puzder, believes there should be no minimum wage at all, and that pay should be entirely left up to employers.

“When you mandate that anybody coming into your company has to be paid a certain minimum — you’re going to kill jobs,” said Newton, a lecturer at the University of California, San Diego, business school. “It’s one of the classic examples of government overreach with regard to regulation.”

Puzder himself has expressed skepticism about raising the minimum wage, while Trump has been all over the map on the issue, contradicting himself multiple times in the course of the campaign.

Newton still has Puzder’s ear: Newton said they have spoken several times in the past month and had contemplated writing a follow-up book, though Newton now thinks Puzder will be too busy. The two met in 2009 in Southern California, where Puzder’s CKE Restaurants, the parent company of Hardee’s and Carl’s Jr., is based.

Puzder and the Trump transition team declined to comment.

In a statement released Friday about how he views the Cabinet position, Puzder said: “My job as a business person is to maximize profits for my company, employees and shareholders. My job as the Secretary of Labor, if confirmed, is to serve U.S. citizen workers — that is my moral and constitutional duty.”

The Department of Labor doesn’t set the minimum wage, but it can go after employers who, for example, short their workers on pay. Puzder could also advise Trump on wages and other employment standards for federal contractors. President Obama, for example, issued an executive order in 2014 raising the minimum wage from $7.25 to $10.10 for workers on federal construction and service contracts.

Labor advocates are also worried Puzder could roll back a new regulation, currently held up in court, that would expand eligibility for overtime pay.

Puzder’s book proposes a “mutually beneficial relationship between employer and employee” and is sharply critical of labor unions: “As the no longer existent American garment industry or segments of the increasingly non-competitive American automotive industry well demonstrate, empowering unions can increase labor costs to the point of putting employers in or near bankruptcy.” The book includes extensive criticism of the Obama administration’s first-term push — later abandoned — to change the law to make it easier for workers to form unions.

“We recognize all the workers have the right to unionize — they also have the right not to,” Newton told ProPublica. He praised Puzder as a “great guy” with “a tremendous amount of insight.”

“We’re all on the same page — we know what it’s going to take to grow the economy in terms of what business is looking for in terms of freedom to expand and hire people,” he said.

IMAGE: Andrew Puzder speaking at the 2016 FreedomFest at Planet Hollywood in Las Vegas, Nevada. Flickr/ Gage Skidmore