Spinning Hillary Centrist

Editor' s Note: This is an excerpt of a longer article about Hillary Clinton's circle of advisers, which will appear in May 16 in the print version of The Nation.

As Hillary Clinton charges toward the Democratic nomination for President, her campaign has a coterie of influential advisers. There's her husband, of course, widely regarded as one of the sharpest political strategists in the business. There's uber-Washington insider and former head of the Democratic National Committee Terry McAuliffe. There are A-list policy wonks like former Treasury Secretary Bob Rubin. But perhaps the most important figure in the campaign is her pollster and chief strategist, Mark Penn, a combative workaholic. Penn is not yet a household name, but perhaps he should be. Inside Hillaryland, he has elaborately managed the centrist image Hillary has cultivated in the Senate. The campaign is polling constantly, and Penn's interpretation of the numbers will in large part decide her political direction.

Yet Penn is no ordinary pollster. Beyond his connections to the Clintons, he not only polls for America's biggest companies but also runs one of the world's premier PR agencies. This creates a dilemma for Hillary: Penn represents many of the interests whose influence candidate Clinton--in an attempt to appeal to an increasingly populist Democratic electorate--has vowed to curtail. Is what's good for Penn and his business good for Hillary's political career? And furthermore, can she convincingly claim to fight for the average American with Penn guiding strategy in her corner?

Despite the risks he poses, it's easy to figure out why Hillary clings to Penn. The Clintons (like the Bushes) put a premium on loyalty, and they credit Penn with saving Bill's presidency. After the 1994 election, Democrats had just lost both houses of Congress and Clinton was floundering in the polls. At the urging of his wife, Bill turned to Dick Morris, a controversial friend from their time in Arkansas. Morris knew Penn from his days as a pollster in New York and brought him into the White House. Morris decided what to poll and Penn polled it. They immediately pushed Clinton to the right, enacting the now-infamous strategy of "triangulation," which co-opted Republican policies like welfare reform and tax cuts and emphasized small-bore issues that supposedly cut across the ideological divide. "They were the ones who said 'Make the '96 election about nothing except V-Chips and school uniforms,'" says a former Clinton adviser. When Morris got caught with a call girl, Penn became the most important adviser in Clinton's second term. "In a White House where polling is virtually a religion," the Washington Post reported in 1996, "Penn is the high priest." He became known as the "most powerful man in Washington you've never heard of."

Penn, who had previously worked in the business world for companies like Texaco and Eli Lilly, brought his corporate ideology to the White House. After moving to Washington he aggressively expanded his polling firm, Penn, Schoen & Berland (PSB). It was said that Penn was the only person who could get Bill Clinton and Bill Gates on the same phone line. Penn's largest client was Microsoft, and he saw no contradiction between working for both the plaintiff and the defense in what was at the time the country's largest antitrust case. A variety of controversial clients enlisted PSB. The firm defended Procter and Gamble's Olestra drug from charges that it caused anal leakage, blamed Texaco's bankruptcy on greedy jurors and market-tested genetically modified foods for Monsanto. Penn invented the concept of "inoculation," in which corporations are shielded from scandal through clever advertising and marketing. Selling an image, companies realized, was as important as winning a legislative favor.

Penn kept his foot in the political world through the Clintons. In 2000 he became the chief architect of Hillary's Senate victory in New York, persuading her, in a rerun of '96, to eschew big themes and relentlessly focus on poll-tested pothole politics, such as suburban transit lines and dairy farming upstate. Following that election, Penn became a very rich man--and an even more valued commodity in the business world (Hillary paid him $1 million for her re-election campaign in '06 and $277,000 in the first quarter of this year). The massive PR empire WPP Group acquired Penn's polling firm for an undisclosed sum in 2001 and four years later named him worldwide CEO of one of its most prized properties, the PR firm Burson-Marsteller (B-M). A key player in the decision to hire Penn was Howard Paster, President Clinton's chief lobbyist to Capitol Hill and a top executive in the WPP firmament. "Clients of stature come to Mark constantly for counsel," says Paster, who informally advises Hillary, explaining the hire. The press release announcing Penn's promotion noted his work "developing and implementing deregulation informational programs for the electric utilities industry and in the financial services sector." The release blithely ignored how utility deregulation contributed to the California electricity crisis manipulated by Enron and the blackout of 2003, which darkened much of the Northeast and upper Midwest.

Burson-Marsteller is hardly a natural fit for a prominent Democrat. The firm has represented everyone from the Argentine military junta to Union Carbide after the 1984 Bhopal disaster in India, in which thousands were killed when toxic fumes were released by one of its plants, to Royal Dutch Shell, which has been accused of massive human rights violations in Nigeria. B-M pioneered the use of pseudo-grassroots front groups, known as "astroturfing," to wage stealth corporate attacks against environmental and consumer organizations. It set up the National Smokers Alliance on behalf of Philip Morris to fight tobacco regulation in the early 1990s. Its current clients include major players in the finance, pharmaceutical and energy industries. In 2006, with Penn at the helm, the company gave 57 percent of its campaign contributions to Republican candidates.

A host of prominent Republicans fall under Penn's purview. B-M's Washington lobbying arm, BKSH & Associates, is run by Charlie Black, a leading GOP operative who maintains close ties to the White House, including Karl Rove, and was former partners with Lee Atwater, the political consultant who crafted the Willie Horton smear campaign used by George H.W. Bush against Michael Dukakis in 1988. Black regularly disparages the Clintons; he has called Hillary a "martyr figure" and said Bill "tearfully embraced...government preferences for [a] homosexual lifestyle." In recent years Black's clients have included the likes of Iraq's Ahmad Chalabi, the darling of the neocon right in the run-up to the war; Lockheed Martin; and Occidental Petroleum. In the summer of 2005 he landed a contract with the Lincoln Group, the disgraced PR firm that covertly placed US military propaganda in Iraqi news outlets. The agreement, according to Intelligence Online, allowed the Lincoln Group to "tap into BKSH's extensive contacts in the Republican administration." When asked by The New Yorker if there was too much cronyism in Iraq, Black responded, "I just wish I could find the cronies."

Black is only one cannon in B-M's Republican arsenal. Its "grassroots" lobbying branch, Direct Impact--which specializes in corporate-funded astroturfing--is run by Dennis Whitfield, a former Reagan Cabinet official, and Dave DenHerder, the political director of the Bush-Cheney '04 campaign in Ohio. That's not all. B-M recently partnered with lobbyist Ed Gillespie, the former head of the Republican National Committee, in creating the new ad firm 360Advantage, which is run by two ad men for the Bush-Cheney campaigns and which includes a few prominent Democrats. Its first project was a campaign for the neoconservative Weekly Standard magazine against "liberal bias" in the media. There's more than a little irony that some Democrats would assist a conservative media machine that so regularly smears the Clintons. Yet the so-called "bipartisan" firm is hardly objective--of its thirteen principals, ten are Republicans.

As expected with such a lineup, B-M has a highly confrontational relationship with organized labor. "Companies cannot be caught unprepared by Organized Labor's coordinated campaigns," read the "Labor Relations" section of its website (until it was scrubbed after Mark Schmitt of The American Prospectquoted the language in March). It consults frequently with George Washington University professor Jarol Manheim, author of The Death of a Thousand Cuts: Corporate Campaigns and the Attack on the Corporation and Biz-War and the Out-of-Power Elite: The Progressive-Left Attack on the Corporation. And it lends help to some of the most controversial union-busting efforts in America.

Back in 2003 two large unions, UNITE (which later merged with HERE, the hotel and restaurant union) and the Teamsters, launched a major drive to organize 32,000 garment workers and truck drivers at Cintas, the country's largest and most profitable uniform and laundry supply company. Its longtime CEO, Richard Farmer, was a mega-fundraising "pioneer" for George W. Bush. Despite posting $3.4 billion in sales and $327 million in profits last year, the company had a record of overcharging consumers, denying workers overtime pay, keeping unsafe working conditions (an employee in Tulsa died recently when caught in a 300-degree drier) and using any means necessary to block the union drive. Management fired employees under false pretenses, according to worker complaints documented by the unions; vowed to close plants; and screened anti-union videos. A plant manager in Vista, California, threatened to "kick driver-employees with his steel-toed boots," according to a complaint UNITE HERE filed with the National Labor Relations Board (NLRB). To put a soft face on its harsh tactics, Cintas hired Wade Gates, a top employee in B-M's Dallas office, as its chief spokesman. Gates coined Cintas's shrewd response to labor: "the right to say yes, the freedom to say no," which has been repeated endlessly in the press. In a speech at the USC Gould School of Law last year, Gates outlined Cintas's strategy, calling for an "aggressive defense against union tactics." Says Ahmer Qadeer, an organizer for UNITE HERE: "It's the Burson influence that's made Cintas much, much slicker than they were." The unions have won two NLRB rulings against Cintas, but for four years the company has continued to resist the organizing campaign.

In 2004 Hillary Clinton asked for an investigation into whether Cintas received preferential regulatory treatment from the Environmental Protection Agency in return for giving large political donations to President Bush. Union officials say she's been supportive of their organizing drive. She's a co-sponsor of the Employee Free Choice Act, which would allow workers to form unions if a majority sign cards authorizing representation, thus avoiding the coercion and intimidation commonly practiced by companies like Cintas during union election campaigns (Cintas bitterly opposes the EFCA). She told the International Association of Firefighters recently, "I believe that it is absolutely essential to the way America works that people be given the right to organize and bargain collectively." Penn has portrayed Clinton as a hero to America's underdogs. "She has a very, very strong base among the Democratic primary voters--first and foremost among voters who have real needs, people who may not have healthcare, people worried about losing a job, people who know someone serving in the war, people in the working and middle class, people whose lives really depend upon having the kind of champion and advocate that Hillary represents," Penn said to the Washington Post.

Yet Hillary apparently sees no contradiction between her own advocacy, as painted by Penn, and the anti-union, pro-corporate work of her chief strategist's company. "Clearly not," says spokesman Howard Wolfson. "I don't think it reflects on her at all. Mark's work away from the campaign is Mark's work, and his campaign work is separate from that." (Wolfson told me to talk to Penn for additional information, but when I contacted Penn he referred all questions to Wolfson.)

Penn recently told the Washington Post, in a largely flattering profile, that he'd been "cleared of all client responsibilities, except for Microsoft, for the duration of the campaign." Microsoft is a strange exception, given that it was the corporate entity the Clinton Administration challenged most directly. Moreover, Penn has no plans to take a formal leave from B-M. (Because B-M is a subsidiary of the WPP Group, which is a UK-based company, it doesn't have to report its CEO's salary or ownership stake in the company.) President Bush forced Karl Rove to sell his direct-mail business in 1999, but don't expect a similar move from Hillary. "Senator Clinton is no different, frankly, from Mark's other clients," Howard Paster says. "Burson-Marsteller is a lot bigger firm than Senator Clinton. There's a whole 'nother life we live." Adds Doug Schoen, when asked if his former partner's arrangement represents a conflict of interest: "I only see that if there are particular interests we are advocating using our contacts. Mark doesn't lobby. I don't lobby. We retain a strict differentiation between the corporate world and the political world."

But it's difficult to tell where Penn's corporate life ends and his political one begins. Most Democratic consultants do some business work--it's the easiest way to pay the bills. Yet nobody wears as many hats--and advises as many corporations--as Penn does. "Penn and Schoen have displayed a thirst for corporate work, often in conflict with the policy agendas of their political clients, that has long set the bar among Democratic pollsters," wrote Democratic pollster Mark Blumenthal on his blog recently. "My employers and partners over the years had corporate lines they (variously) refused to cross--tobacco, pharma, big oil, aggressively anti-union--both out of ideological principle and to avoid putting their valued political clients in a tough spot. A quick glance at the Penn, Schoen, Berland client list shows they not only crossed some of those lines, but did so with enthusiasm."

Furthermore, few Democratic consultants so consistently and publicly advocate an ideology that perfectly complements their corporate clients. Every election cycle Penn discovers a new group of swing voters--"soccer moms," "wired workers," "office park dads"--who happen to be the key to the election and believe the same thing: "Outdated appeals to class grievances and attacks upon corporate perfidy only alienate new consistencies and ring increasingly hollow," Penn has written. Through his longtime association with the Democratic Leadership Council, Penn has been pushing pro-corporate centrism for years. Many of the same companies that underwrite the DLC, such as Eli Lilly, AT&T, Texaco and Microsoft, also happen to be clients of Penn's.

Yet despite occupying such a divisive place in the Democratic Party and outsized role in the corporate world--and despite his company's close ties to Republican political operatives and the Bush White House--Penn remains a leading figure in Hillary's campaign, pitching the inevitability of her nomination to donors and party bigwigs. According to the New York Times, "[Hillary] Clinton responds to Penn's points with exclamations like, Oh, Mark, what a smart thing to say!" Politically, his presence means that triangulation is alive and well inside the campaign and that despite her populist forays, Hillary won't stray too far from the center. "Penn has a lot of influence on her, no doubt about it," says New York political consultant Hank Sheinkopf, who worked with Penn in '96. "He's not going to let her drift too far left."

Ari Berman, based in Washington, DC, is a contributing writer for The Nation, a contributor to The Notion and a Puffin Foundation writing fellow at The Nation Institute.

(c) 2007 The Nation

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