Breaking the Law: Newt’s Other Contract With America

Tuesday, January 24, 2012

Well, Newt has released his January 1, 2006 contract with Freddie Mac which pays his company, The Gingrich Group, $25,000 per month for 12 months, a total of $300,000. (The full text of the contract can be seen at The Washington Post’s “The Fix,” in an article by Rachel Weiner posted yesterday evening. There were other contracts covering 1999 through 2008 that, including this 2006 contract, paid Newt’s firm in excess of $1.6 million, but this 2006 contract is the only one the Gingrich campaign has released so far.

According to the contract, Newt’s company was hired by Freddie Mac’s Director of Public Policy, Craig Thomas, a registered lobbyist. By “hired,” I mean that Mr. Thomas represented Freddie Mac and executed the contract on Freddie Mac’s behalf.

The contract consists of a form with information about the parties to the contract and compensation, followed by exhibits. Exhibit 1 is called “Terms and Conditions” and is, for all intents and purposes, the body of the agreement. Exhibit 2 is called “Scope of Services and Fees.”

The Gingrich Group is known in the contract as “Consultant.”

In Exhibit 1, Section 1 (“Scope and Standard of Services”), the contract says the following:

In general, the services to be provided by Consultant hereunder consist of consulting services and Consultant will provide the services as described in Exhibit 2 (“Services”).

Okay, fair enough. Let’s see what the contract says in Exhibit 2 which I will copy here in its entirety:

Consultant will provide consulting and related service as proposed by Freddie Mac’s Director, Public Policy in exchange for which Freddie Mac will pay Consultant $25,000 per each full calendar month during which Consultant provides Services.

That’s it. That’s the entire description of what Mr. Thomas was hiring The Gingrich Group, primarily Newt Gingrich, to do for Freddie Mac. We can only imagine what chores Mr. Thomas had in mind.

Okay, do you know why Freddie Mac wasn’t more specific about what The Gingrich Group was being hired to do? ..other than a vague reference to whatever is “proposed by..” Mr. Thomas? ..even though being specific would, ordinarily, protect the interests of both the employer and employee? The simple answer is that neither party wanted to put it in writing. ..Bingo.

The next steps include getting a look at Newt’s other contracts with Freddie Mac but, more importantly, finding out exactly what The Gingrich Group did for it’s $1.6+ million.

Oh, and if you’re waiting for the Obama Administration’s Justice Department to look into this, because federal law requires lobbyists to register, don’t hold your breath. It might be the right thing for them to do, but it’s bad politics not to wait at least until after Newt, heaven forbid, gets the nomination.



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