Putting McCain to the Ethics Test

By Michael Scherer

The U.S. Senate is a lousy launching pad for sainthood, a place of compromise and backslaps, of hidden doors that lead to gilded rooms where the real work gets done. To succeed is to succumb, often to the courtship of big-ticket donors.

And yet for more than a decade,John McCain has claimed to truck with angels. He condemns his colleagues who earmark bridges or bike trails, often at the request of contributors. When a powerful trade group is arrayed against him, he bellows, "The fix is in." He exploded with contempt for the corrupting ways of Washington at one hearing in 1999. "This is Congress," McCain declared, "where telecommunications-industry lobbying is no-holds-barred."

Such displays of outrage have fueled the G.O.P. nominee's political success, earning him a reputation as a reformer with higher nationwide favorability ratings than either Barack Obama or Hillary Clinton. It's because of that reputation, which particularly appeals to independent voters, that Democrats have started targeting McCain's reformer cred.

In recent weeks Democratic leader Howard Dean has called McCain a "situation ethicist" who "runs on his integrity, but he doesn't seem to have any." Obama has alleged that McCain puts lobbyists "in charge of his campaign," even though the Democratic candidates are also advised by current and former influence brokers. The Democratic National Committee regularly blasts out statements tagging McCain with ominous phrases like special-interest cronyism.

The McCain campaign has publicly welcomed the questioning. "We're happy to debate ethical standards and commitment to reform and ethics all day long," says Rick Davis, McCain's campaign manager, pointing to the Senator's record of reform in the Senate. But Davis' own resume, as a former telecommunications lobbyist who twice switched sides to work for McCain, illustrates the clouds circling the candidate's blue-sky reputation.

No longtime Senate leader can escape charges of favoritism, even a crusader against improper influence like McCain. This is especially true for a former chairman of the powerful Commerce Committee. "The issues before the committee often pit industry against industry," explains Ivan Schlager, who served as the committee's Democratic chief counsel, "so you are always appearing to favor somebody."

Take that 1999 outburst about no-holds-barred lobbying, for example. The subject of the hearing was legislation to allow satellite companies to relay local network signals to viewers, an idea promoted by McCain but opposed by the broadcast and cable industries. A major proponent of the bill happened to be a McCain supporter, Charles Ergen, head of the Dish Network. Less than a month after the hearing, Ergen held a fund raiser at his Denver home for McCain, reportedly raising more than $40,000. A few years later, Ergen's company gave more than $50,000 to a nonprofit institute that employed Davis and was chaired by McCain himself. No-holds-barred, indeed.

McCain's defense of such incidents is invariably twofold. First, he declares categorically that he has not betrayed the public trust. "I have never done any favors for anybody -- lobbyist or special-interest group," he said last December. But he complicates matters by also admitting what other politicians rarely do: the system itself is corrupted and corrupting. "All of us are tainted," McCain said in 2002. "And I am one of them."

The self-image of McCain as a saint operating in a sinner's world has been carefully crafted over the years and embraces the contradictions of his job. He is both a vigorous fund raiser -- collecting more than $135 million over his career -- and the nation's leading G.O.P. campaign-finance reformer. His inner circle includes current and former lobbyists, but he has sponsored bills limiting their influence. He has begged discount private-jet flights from companies seeking his favor but also led an effort to end the discount lending practice. McCain is, in other words, not an easy man to judge.

The Problem of Appearance McCain's trouble with influence-peddling dates to 1987, when he found himself ensnared in the Keating Five scandal. He had met with federal regulators on behalf of banker Charles Keating Jr., a wealthy fund raiser and friend who had flown the McCain family on private jets to vacations in the Bahamas. A Senate ethics panel found that McCain had exercised "poor judgment" but had broken no rules. The honor-bound Senator was nonetheless rattled. "Appearance in politics," McCain said years later, "is reality."

The episode inspired McCain's rebirth as a reformer concerned above all with appearance. He successfully worked to outlaw unregulated, six-figure "soft-money" donations to political parties. That was followed by crusades against lobbying access and an extensive corruption investigation against the Republican lobbyist Jack Abramoff.

But high standards are a double-edged sword. Even as McCain railed against the system, he worked it, sometimes creating unseemly appearances of his own. As with many other Senators, some of McCain's biggest corporate donors were invariably the companies that sought his favor -- firms like FedEx, AT&T and Qwest Communications. At one point, he even allowed Fred Smith, a friend who ran FedEx, to sponsor a book party for McCain's memoir Worth the Fighting For.

In the Senate, McCain has been remarkably open about the pressures that other members of the Commerce Committee felt from such donors. He claimed that the 1996 Telecommunications Act, which he opposed, had been "hijacked" by campaign donors and lobbyists. But when it came to his own decisions, which often favored those same donors, McCain maintained there was no impropriety. Following his small-government philosophy, he argued for further deregulation of telecommunications and a ban on Internet taxation, positions that happened to benefit his donors.

In some cases, McCain's intervention on causes that favored donors appeared to be exceptional. Consider the committee meeting that McCain led on June 23, 1999. The topic of the day was a proposal to require access to 911 emergency services for cellular phones. But McCain scrambled the script with just a few hours' notice. He introduced an unrelated amendment that would force the Federal Communications Commission (FCC) to allow companies to own two television stations in the same market. Democrats were outraged by the move, since it violated McCain's own rule requiring Senators to give a full day's notice before introducing amendments, a practice he put in place to prevent under-the-radar legislative tampering.

"We do not ambush the committee," objected South Carolina Democrat Fritz Hollings at the hearing, accusing McCain of trying to squeeze through the amendment "in the dark of night." Hollings was also upset that McCain's proposal would upend a rulemaking process at the FCC.

Hearing the objection, McCain dropped his amendment, but the incident left a bad taste with several of the committee's Democrats. They knew that smaller television companies were pushing hard to loosen the FCC rules. Two of those companies were Glencairn and Paxson Communications, which had hired Hector Alcalde to represent them before McCain, with apparently good results. One month after the hearing, McCain met with the head of Glencairn, Eddie Edwards. Nine days later, at least three members of the Edwards family gave McCain maximum donations of $1,000 each.

Three Democratic staffers present at the markup that day say they were convinced that McCain had proposed the last-minute amendment because of pressure from Alcalde, whom they remember as being seated near the front of the room. "At any given time, there are 100 different amendments to the Communications Act that John McCain believes in," noted a staffer. "He happened to do the one that was being pushed by the people who were raising money for him and whose representative was sitting in the third row." (Through a spokesman, McCain says he never expected the amendment to be accepted and only introduced it to "send a message" to the FCC. Alcalde says he did not request the amendment and does not recall attending the hearing.)

The entanglement between McCain's office and Alcalde's firm went further. In December 1999, FCC chairman William Kennard chastised McCain for writing a letter encouraging the resolution to a licensing matter involving Paxson Communications. The letter was written one day after McCain had been flown on a Paxson jet to a fund raiser on a yacht in West Palm Beach, Fla., and just weeks before Paxson's owner was scheduled to hold a fund raiser for McCain. The appearance problem was so severe that John Weaver, McCain's political adviser at the time, asked one of Alcalde's lobbyists on the Paxson account to keep a distance from the campaign.

A Reformer's Burden For most other Senators, especially those lacking presidential ambitions, such untoward appearances would not raise much of an eyebrow. On any given day, thousands of lobbyists work their connections on Capitol Hill, hoping to obtain letters on their behalf or legislation in their favor. But for McCain, such questions become an issue of integrity. He is the one, after all, who regularly breaks the Senate's code of silence by alleging corruption by his peers. "Elected officials do act in particular ways in order to assist large soft-money donors," McCain wrote in a sworn statement from the 2002 Supreme Court case over his campaign-finance bill. "This skews and shapes the legislative process."

The McCain campaign answers questions about discrepancies between the candidate's words and actions by asserting that his motivations are different from those of his more crass colleagues. "John McCain takes positions on legislative and regulatory issues based on his perception of the public good," writes Brian Rogers, McCain's campaign spokesman, in an e-mail. His position in favor of Ergen, aides say, was nothing other than an effort to bring more competition to cable providers, to lower prices for consumers. Likewise, his opposition to FCC ownership caps for television stations resulted from a long-standing belief that technological changes had made the old laws obsolete.

On this point, McCain has some surprising character witnesses. "He has always done the right thing, as far as I know, on the legislation I have worked on with him," says Joan Claybrook, president of the liberal group Public Citizen, an organization that disagrees with most of McCain's votes on key issues. "He will listen to the merits and make a decision."

Along the same lines, lobbyists close to McCain wear as badges of honor the times he has tossed them from his office. Charlie Black, a senior McCain adviser who has admitted to making calls to lobbying clients while aboard the McCain campaign bus, represented tobacco giant Philip Morris in 1998 when McCain decided to go to war with the tobacco industry. "He called me up and said, 'Look, I am not talking to you about this tobacco stuff anymore, and don't talk to the staff either,'" Black remembers. He said he called McCain's staff anyway, only to be rebuffed.

In the free-fire information war of a presidential campaign, such nuance can easily get lost in the sound bites. So for McCain, his ability to explain these complex relationships with lobbyists and monied interests is about to be tested. The appearance of impropriety may well be just that -- appearance instead of reality. Nonetheless, McCain is now in the awkward position of hoping voters will give him the benefit of the doubt that he has denied to others.