Newt Gingrich's Business Network Getting Second Look
WASHINGTON -- Newt Gingrich calls it giving advice. Most people would call it cashing in on his prominent name.
The former House speaker has raked in millions of dollars since leaving office more than a decade ago. Now as a rising GOP presidential candidate he's facing renewed scrutiny of the intricate network of consulting firms, advocacy organizations and other businesses that, taken together, some have called Newt Inc.
"I do no lobbying of any kind. I never have. A very important point I want to make. I have never done lobbying of any kind," Gingrich told Fox News Channel this week, defending himself over questions about his time since he left the speaker's office under a political cloud in January 1999.
He has said he welcomes the scrutiny and questions over potential conflicts, yet his campaign declined an interview request from The Associated Press.
Gingrich's finances – and the elaborate consulting and communications empire he has built since leaving Congress – are now getting a second look as the man who for years was the ultimate Washington insider campaigns as a reformer who can change Washington.
His presidential campaign imploded earlier this year, but polls show his support has risen just weeks before Iowa's presidential caucuses kick off the GOP nominating contests. Lingering questions about his business associations threaten that standing, which explains why Gingrich has grown increasingly defensive about his businesses as the spotlight grows brighter.
And at times he's tried to have it both ways. Speaking to students at Harvard's Kennedy School Friday night, he criticized the consulting industry he was part of for years: "What's happened is we've grown a consulting industry, so that instead of having the old-time big city machine bosses, we now have these consultants," he said.
He also has described himself as "historian," hired by some firms that sought advice on policy matters.
Gingrich's business network has for years given the Georgia Republican a far-reaching platform for his views.
At times, he has espoused some public policy positions that closely track the financial interests of companies that underwrite a think tank he founded, the Center for Health Transformation. He has, for example, pushed for electronic medical records and government funded medical research while collecting paychecks from pharmaceutical companies and hospital chains that backed the proposals.
Health companies paid as much as $200,000 a year in dues to the think tank, which was created in 2003 to find ways to make health care better, cheaper and more modern. It has been a significant part of Gingrich's empire, with him spending – at one point in recent years – one-third or more of his time on the think tank.
The Washington Post reported that it collected at least $37 million in the last eight years.
"They sold the ability to come and sit down and talk, and I'd listen to people and give them ideas," Gingrich told reporters after the Boston event.
In recent days, Gingrich also has been defending himself amid the disclosure that he brought in more than $1.6 million from 1999 to 2008 to advise Freddie Mac, the federally backed mortgage giant that he routinely criticizes and that some conservatives blame for the housing crisis.
He downplayed any personal benefit Friday night.
They were "Gingrich group's earnings, not my earnings," he said. "Over a period of years, Freddie Mac paid Gingrich group, which has a number of employees and a number of offices, a consulting fee just like you would pay any other consulting firm."
Further, Gingrich has tried to spin his consulting fees into a positive, saying: "It reminds people that I know a great deal about Washington. We just tried four years of amateur ignorance and it didn't work very well. So, having someone who actually knows Washington might be a really good thing."
During the 2008 campaign, Gingrich called on then-Democratic presidential candidate Barack Obama to return campaign contributions from the mortgage company executives; Obama refused.
Yet Gingrich has been compensated for consulting work by the same group, and hasn't shown any indication that he'd return the money.
"There's a huge difference between what you do when you're in public office and you're dealing with the public trust and what you do as a private business person who has no direct power and no direct responsibility and you're sitting there offering advice," Gingrich told Fox, where he was once a paid contributor.
Gingrich is trying to move beyond the questions about Freddie Mac and is acknowledging that he has worked for some of the biggest names in business, including Microsoft, General Electric and PhRMA, a trade group that represents pharmaceutical research and biotechnology companies.
But over the years, he has used frequent opinion columns to promote some of those companies.
For example:
_ Gingrich warned against specialty hospitals allowing doctors to cherry-pick easy cases, echoing concerns of the American Hospital Association and Hospital Corporation of America. The two companies helped fund Gingrich's health care think tank.
_ In The Baltimore Sun and The New York Sun, Gingrich criticized congressional efforts to cut spending for the National Cancer Institute, where research dollars have helped develop drugs that earn millions of dollars for pharmaceutical companies that belong to Gingrich's think tank.
_Gingrich argued in The New York Times, Atlanta Journal-Constitution and Seattle Post-Intelligencer in 2004, and in the Chicago Tribune and again in the Times in 2005, for electronic medical records. Supporter Siemens makes a health records card, and consulting firm Booz Allen Hamilton teamed on a U.S. military contract to develop electronic medical records.
The candidate may call all that old news, but it may be new to voters just tuning into the presidential race.
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Associated Press writer Steve Peoples in Boston contributed to this report.
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By PHILIP ELLIOTT 11/18/11 08:51 PM ET Associated Press