Over the past three years, as Airbus and Boeing have been locked in a bitter fight over each other’s government subsidies, an obscure nonprofit has sponsored at least 10 trips for congressional officials to Toulouse, France, where Airbus is headquartered.
The Washington-based European Institute, whose board includes executives from dozens of the world’s most prominent companies, aims to facilitate communication among government and industry leaders in Europe and the United States.
The institute’s spokeswoman, Maria Papathanassiou, acknowledged that some congressional officials were taken to an Airbus operation in France. “We were trying to show the relationships between European companies and American companies,” she said. “We just happened to be able to go to the Airbus facility.”But at least 38 of its trips in recent years — virtually all of the $370,000 it spent on international travel — have included stops in France and often involved aviation issues. Although its largesse could have influenced lawmakers, the institute is not registered to lobby.
A Center for Public Integrity analysis of travel disclosure and lobbying documents found that the institute is one of about 200 organizations that paid for congressional trips during a 5½-year period beginning in January 2000, but did not register — even though some behave like lobbying groups.
Some of these unregistered groups write letters petitioning the U.S. government on issues and testify before Congress on proposed legislation. A few also receive government contracts and grants, giving them incentive to sponsor travel and lobby on issues relevant to them.
In all, these unregistered groups paid for more than 6,500 trips during the period reviewed by the Center, spending at least $20 million. This represents more than 40 percent of all the money spent on privately financed trips.
“The wide majority of these groups that are paying for these trips are not following the lobbying laws,” said Craig Holman, who analyzes special interests for the political advocacy group Public Citizen. “This is not carelessness — this is just breaking the law and these trips are nothing but an extension of lobbying activities.”
The European Institute’s influence extends beyond Congress. Since 2000, the nonprofit has brought together corporate and government officials, including a State Department undersecretary, a Defense Department deputy secretary and a Federal Reserve Board vice chairman
If the institute had registered to lobby, records would shed more light on the underlying reasons for its actions. It would have to reveal legislation it was advocating, list those involved in influencing government officials and quantify the amount spent on these activities.
Institute founder Jacqueline Grapin disputes characterizing the group’s activities as lobbying. “We are not a lobbying organization,” she said.
Grapin, whose online biography lists her as a counselor to the French government on foreign trade, said that the nonprofit does not have a specific agenda.
“Sometimes we take these conversations and put them forward as recommendations,” she said, “but we do not try to sell these recommendations.”
The Center’s overall study of more than 23,000 privately funded congressional trips identified 14 organizations that each spent at least $500,000 sponsoring travel. Ten of those were groups that had not filed lobbying forms, including the Aspen Institute ($3.5 million) and the Congressional Institute ($830,000).
Some unregistered organizations also have been criticized by congressional watchdog groups such as Public Citizen for acting on behalf of corporate entities.
Both the Ripon Educational Fund and the Ripon Society, for example, had at least one lobbyist serving on their boards during the study period. The Educational Fund was founded by lobbyist Richard Kessler, the society’s current president. The fund’s board has included at least three other lobbyists, among them former Rep. Susan Molinari, R-N.Y. The two groups split in 2003; the fund alone spent more than $830,000 on travel during the 5½-year study period.
A staff member has had more than one contact with a covered official (including any member of Congress and nearly all paid congressional staff)The Lobbying Disclosure Act of 1995 states that an organization must register to lobby if, during a six-month period:
- A staff member has spent at least 20 percent of his or her time on lobbying activities
- The organization has spent more than $24,500 between salaries and related costs to influence the government.
Experts say the amount of time an individual or group spends trying to influence policy is impossible for an outside party to measure.
“Even if someone is a lawyer/lobbyist, to identify and keep track of how much time you are spending on lobbying versus legal becomes a gray area,” said Paul Miller, president of the American League of Lobbyists. “To have someone in the House or Senate try to identify and calculate that percentage too is probably unreasonable to do.”
Nonetheless, the Center found that a sizable number of unregistered groups sponsoring travel that either spent more than $24,500 or had multiple contacts with a congressional official.
Another group that was not registered to lobby but spent significant resources to work side-by-side with Congress is the Mercatus Center, a policy research-based organization located on the campus of George Mason University in Arlington, Va. While it regularly petitions the White House Office of Management and Budget for changes to federal regulations, it is classified as a charitable organization.
Mercatus, which espouses the philosophy of less government regulation, has been successful in the regulatory and legislative arenas.
In 2001 alone, when the OMB sent a report to Congress suggesting sweeping changes to federal rules, almost two out of three were based on recommendations by the group, according to a Center analysis. Mercatus called for scaling back many proposed and longstanding regulations, including the Clean Air Act and the National Forest Management Act. The group also helped coax the Bush administration into delaying reductions in the level of arsenic allowed in drinking water.
Mercatus also testified in favor of the Central American Free Trade Agreement before its passage in 2005.
Mercatus’ philosophy is one embraced by Charles Koch, chairman and chief executive officer of Koch Industries Inc., who is on the group’s board of directors. (Koch Industries is an energy corporation that has paid at least $50 million for Clean Air Act and Clean Water Act violations since 2000.) In addition to serving on Mercatus’ board, his Charles G. Koch Charitable Foundation donated more than $17 million to the Mercatus Center and the George Mason University Foundation between September 1989 and January 2004, according to an analysis by the organization Media Transparency.
In 2005, Rep. Bob Ney, R-Ohio, whose office has accepted 19 trips from Mercatus — more than any other — introduced a bill to amend the Clean Air Act and require the secretary of energy to construct 15 new gasoline refineries and sell them to private businesses. Mercatus has sought to weaken the act and spoken of the need for more refineries — both scenarios that could benefit Koch Industries.
“Neither the congressman nor his staff has ever had a single conversation with anyone from Mercatus about that bill,” said Brian Walsh, communications director for Ney. “He introduced that bill to reduce America’s dependence on foreign countries for oil. We have not had a new refinery built in this country in over 20 years.”
While Congress is in session Mercatus also conducts regular seminars in congressional office buildings, where staffers are offered free meals and given lectures on issues such as health care, telecommunications regulation and tort reform.Mercatus spent at least $227,000 on more than 400 trips for lawmakers and their aides from 2000 through mid-2005. Most of this money appears to have been spent on the group’s annual retreat for congressional chiefs of staff, who are often put up in posh hotels near Washington and attend seminars on public policy.
“There is no conceivable argument of why this group has not registered to lobby. They have met the threshold that makes them a lobbying group,” said Holman of Public Citizen, whose group investigated Mercatus and reported that the OMB’s Office of Information and Regulatory Affairs was headed by a former Mercatus advisory board member, John Graham.
Lobbying rules stipulate that groups have to register after spending more than $24,500 during a six-month period to influence the government. Mercatus exceeded these thresholds in 2004 and 2005, spending more than $55,000 each year on congressional travel.
“The Mercatus Center does not engage in lobbying,” Carrie Conko, the organization’s communications director, said in a written statement for this story. “The Mercatus Center and the university faculty members who teach our programs do not take positions on specific legislation.”
Conko declined to explain how Mercatus is different from the more than 400 universities and related organizations that have registered and spent more than $179 million lobbying the federal government from 1998 through 2004.
International business coalitions and nonprofits that don’t register to lobby collectively spent millions on congressional travel during the 5½-year study period.
Any foreign government-related entity working in a lobbying or public relations capacity in America is required to register under the Foreign Agents Registration Act (FARA), rather than the Lobbying Disclosure Act (LDA). A FARA violation is a criminal offense rather than a civil matter.
Some organizations that have sponsored “fact-finding” missions to the countries they are promoting but are not registered under FARA are the American Israel Education Foundation ($950,000 spent during the study period); the Japan Center for International Exchange ($283,000); and the American-Turkish Council ($140,000).
The Japan Center for International Exchange, which has the mission of building understanding between Japan and other countries, does not lobby, says the group’s executive director James Gannon.
“We are not a lobbyist … we are not pushing a standpoint,” Gannon said.
The American Israel Education Foundation and the American-Turkish Council did not return phone calls from the Center seeking comment for this report.
The Department of Justice’s FARA office refused to comment on these groups, referring only to its Web site, which uses ambiguous language. For example, the term “person” is defined as “an individual, partnership, association, corporation, organization, or any other combination of individuals.”
Certain nonprofits operating in foreign countries or receiving funds from foreign governments fall under FARA. Unless they qualify for an exemption, such groups are required to register if they engage in political activities, public relations or represent a foreign organization before the U.S. government.FARA itself is vague, giving organizations many ways to avoid having to register as lobbying groups. It is unclear whether the European Institute would have to register under FARA, the LDA or neither.
One international group that has been extremely active in congressional travel but was not included in the 200 unregistered groups identified for this report is the Confederation of Indian Industry (CII). After spending more than a half-million dollars on congressional travel from January 2000 through mid-April 2005, the business consortium filed its first lobbying forms.
The group registered to lobby for only a five-month period, from April 15 through Sept. 30, 2005 — coinciding with a major international energy initiative. CII acted as a catalyst for a deal that would allow the United States to sell nuclear reactors to India. The Bush administration’s proposal was sharply criticized by some in Congress.
CII spent $520,000 lobbying six federal agencies, Congress and the Executive Office of the President during the five-month period, records show. Heading up the team of CII lobbyists was the former U.S. ambassador to India, Robert D. Blackwill, who also served as Bush’s deputy assistant and as deputy national security adviser.
The confederation backed the nuclear initiative and partnered with a group that also hired a Washington lobbying firm “to help push through the U.S.-India civilian nuclear agreement in the U.S. Congress,” according to the CII Web site.
CII’s spending on travel was eclipsed by that of two closely connected Taiwanese groups that collectively have spent almost $3 million since 2000 — and that are not registered to lobby.
The groups — the Chinese International Economic Cooperation Association (CIECA) and the Chinese National Association of Industry and Commerce (CNAIC) — have sent officials from more than 300 congressional offices halfway around the world. Both seek support for Taiwan’s quest for self-determination.
A recently introduced House resolution supporting a “free trade agreement between the United States and Taiwan” has been endorsed by a number of lawmakers whose offices took CIECA- or CNAIC-sponsored trips. The Center found that members or staffers from the offices of 29 of the 46 co-sponsors of the resolution traveled at the expense of one of the groups; collectively, more than $400,000 was spent on those offices.
Neither CIECA nor CNAIC responded to phone calls and e-mails from the Center seeking comment for this report.
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