Checkbook Diplomacy - Part Two (cont.)
Lawrence ultimately won confirmation, and he served almost two years abroad. After he died in Switzerland from complications of leukemia and a blood disorder, he was buried — at his earlier request to the State Department — in Arlington Cemetery, with Bill Clinton delivering the eulogy. But Republican researchers later discovered that he had never served in the Merchant Marine, as he had claimed, during the war. His body was disinterred and, at his wife’s request, moved to a California cemetery.
Not to be outdone by his predecessors, George W. Bush appointed Richard Egan, the billionaire founder of the EMC computer company, to be ambassador to Ireland. The appointment was made shortly before Egan invested $62 million in a sham tax shelter set up by the accounting firm KPMG, which was using Irish shell companies to help rich Americans avoid paying taxes. Egan left his post after only 15 months. He was never charged with a crime and has sued seeking the return of the $62 million, which was seized by the IRS.
And then there’s Roland Arnall, the founder of Ameriquest Mortgage Company, who, along with his family members, has raised and donated millions of dollars for Bush and his fellow Republicans — so much money, in fact, that he and his wife rank as the president’s biggest fundraisers. Bush sent Arnall to the Netherlands in 2005, around the time his company was facing investigations in 30 states of predatory mortgage lending practices that were forcing homeowners into foreclosure. On the very day Bush nominated Arnall as an ambassador, Ameriquest’s parent company announced it was setting aside $325 million for a settlement, finalized in 2006, of those claims.
Melvin Sembler founded a controversial juvenile drug rehabilitation program, raised big money for the Republican Party, and was appointed to ambassadorships by both Presidents Bush. (Department of State)Most of Bush’s ambassador appointments have stayed out of the news, despite, in many cases, their lack of credentials for the job. One exception is Melvin Sembler, a major Republican fundraiser who was appointed to ambassadorships by both Presidents Bush. The younger Bush initially picked him to head the Export-Import Bank, but he ran into financial conflicts and had to turn down the job. As a consolation, Bush sent him to Rome, a job as often as not given to Italian-Americans in recent decades.
Sembler, a Florida shopping center developer, began supporting the elder Bush for president in 1979 after meeting him in Tampa. Sembler worked on Bush’s ’88 campaign, was the finance co-chair for his inaugural, and, in ’89, was appointed ambassador to Australia. Since then, Sembler has been a major fundraising force in GOP political circles, serving as the finance chair of the Republican National Committee and raising money for the second Bush’s 2000 campaign.
Sembler’s appointment as ambassador to Italy was controversial and not just because of his political contributions. In the 1970s, he and his wife, Betty, had founded a chain of juvenile drug rehabilitation programs called Straight Inc. The “tough love” program, with clinics across the country, collapsed after 15 years amid lawsuits and run-ins with state regulators, thanks to allegations that kids in the program were being sexually abused, beaten, and illegally restrained. The program has been the source of TV and newspaper investigations, yet Sembler has pointed to the program with pride during confirmation hearings, frequently asserting that 12,000 kids were successfully treated.
Sembler said in an interview that the allegations about mistreatment at Straight Inc. are the product of a few disgruntled participants, and that he never would have been involved with a program that abused children. He also believes that the bad publicity has been ginned up by the drug legalization movement, which doesn’t like his continued anti-drug crusade.
Despite the bad publicity during Sembler’s second tour through the State Department, he won accolades from the embassy staff for his energetic and effective leadership. And his political connections — the source of much criticism leveled against him — have helped him succeed. In fact, Sembler’s experience shows why efforts to abolish politically appointed ambassadors have usually failed: They can sometimes get things done that the Foreign Service can’t.
Before being posted to Rome, for example, Sembler read an inspector general’s report that urged that three buildings on the property were vulnerable to car bombs and should be shut down.
Upon arriving in Rome, Sembler inspected the buildings and discovered that, in the event of a problem, there was only one way out. One building, which the State Department had been renting for 15 years, had no fire escape; in case of emergency, employees would go out a window, where the government had installed a platform with stairs that led into a tiny courtyard completely enclosed by other buildings. If you were trapped there, Sembler says: “The State Department had an answer to that. You had a box. Inside was a sledgehammer, a hard hat, and asbestos gloves. So if you get trapped you take the sledgehammer and you try to go through someone else’s building.”
Sembler says the security concerns about these satellite buildings prompted the State Department to draw up plans to relocate 200 staffers into the main embassy. But after a year of study, the architect couldn’t figure out how to make all those people fit into a building that was already “packed to the gills,” Sembler says. So he started negotiating to buy the building adjacent to the embassy, and was finally able to knock the price down by $25 million. Sembler brought congressional appropriators to Rome to look at the security concerns and to persuade them to allocate money to buy the building.
“A Foreign Service officer would probably have been run out of the service if he had done what I did,” Sembler says, explaining that new ambassadors are given specific instructions not to approach Congress about their problems. Ambassadors are supposed to work through the chain of command at the State Department. “I tried that,” he says, and it didn’t work, so being a seasoned real estate developer, he started negotiating with the building owner on his own. “When we got the new building,” he says, “we were able to cancel the leases on three other buildings, at no cost to the government.” Even so, the $83.5 million acquisition was not without controversy: A friendly member of Congress from Florida amended an appropriations bill to name the annex “the Mel Sembler Building,” an unprecedented — and some said, unseemly — honor for a sitting ambassador.
Ambassadorships offer all the perks of public service without most of the headaches that come with actually running the government. “Would you rather be an ambassador or would you rather be a [Cabinet] secretary?” Sembler asked, noting that the reward these days for public service is often a subpoena or criminal investigation.
“It’s a great title,” says Sembler, who points out that “ambassador” is one of the few titles that protocol allows people to keep using even after they’re done serving. “It’s a wonderful job. You’re the president’s personal representative. You’re away from the United States, so you have the authority of the president …. You’re running something.”
Part One: The Buying of Ambassadorships
Part Two: Big egos, big donations, big status
Part Three: Part Three: The system resists fixing
Listen to the BBC Radio World Service documentary The Billion Dollar Election: Part Two - Ambassadors
Stephanie Mencimer covers legal affairs and domestic policy in the Washington bureau of Mother Jones magazine and is a contributing editor at Washington Monthly. Previously, she was a senior writer at Washington City Paper, an investigative reporter for The Washington Post, and a staff writer for Legal Times. Mencimer is the author of Blocking the Courthouse Door: How the Republican Party and Its Corporate Allies Are Taking Away Your Right to Sue.
SOURCES: Marc Lacey and Raymond Bonner, “A Mad Scramble for Plum Posts,” The New York Times, March 18, 2001; Interview with Chuck Mannatt; “Overview of a U.S. Mission,” U.S. Department of State; “Key U.S. Diplomats Derided by Toon,” The New York Times, April 1, 1982; Transcript, Lawrence F. O’Brien Oral History Interview II, by Michael L. Gillette, Lyndon N. Johnson Library, October 29, 1985; John Vinocur, “Ambassador Galbraith: Adeiu to all That,” The New York Times, February 13, 1985; Don Van Natta Jr. and Elaine Sciolino, “Body, and Tombstone of Lies, Are Removed,” The New York Times, December 12, 1997; “Ambassador Is Fined for Excess Donations,” The New York Times, March 8, 1994; Michael Kilian, “Lord Fat Cat,” Chicago Tribune, December 8, 1993; “U.S. Taxmen Look to Ireland as Alleged Scams Are Revealed,” The Irish Times, March 27, 2006; Kirstin Downey, “Bush Picks Ameriquest Owner as Ambassador,” The Washington Post, July 29, 2005; John Gorenfeld, “Ambassador de Sade,” Alternet, November 8, 2005.