Democratic News

May 18 2017

Cantwell Calls On David Bernhardt To Permanently Recuse Himself From His Corporate Clients

In Nomination Hearing, Bernhardt Declines to Commit to Permanent Recusal

Watch video of Sen. Cantwell’s opening statement and questions to David Bernhardt here.  

Washington, D.C. – Today, Ranking Member of the U.S. Senate Energy and Natural Resources Committee Maria Cantwell (D-Wash.) questioned the Trump Administration's nominee for the Deputy Secretary of the Department of the Interior, David Bernhardt. 

The Interior Deputy Secretary is responsible for stewardship of public lands and natural resources, in addition to making sure the interests of all American consumers and tribes are protected. Sen. Cantwell demanded answers regarding Bernhardt’s plans to assure the American people that his previous or future financial interests will not affect his role in relevant decisions he will potentially have authority over in his new role. 

In her opening statement Sen. Cantwell said, “Since leaving the Department in January 2009, Mr. Bernhardt has returned to a very successful and lucrative lobbying practice. He has represented a wide range of clients: oil and gas companies, mining companies, and water supply interests in California, to name just a few.  Mr. Bernhardt was previously tasked with helping to oversee these same companies while at the Department of Interior. Now, Mr. Bernhardt is asking us for permission to walk back through that revolving door once again.”

Watch the video of Sen. Cantwell’s opening statement and Q&A here.

Below are Sen. Cantwell’s full opening remarks as submitted for the record

Opening Statement

David Bernhardt Nomination Hearing

Thursday, May 18, 2017

The confirmation of the Deputy Secretary of the Interior is every bit as important as the confirmation of the Secretary himself.

The Deputy assists the Secretary in supervising and administering the Department. He performs all the functions of the Secretary in the Secretary’s absence. 

In virtually all matters, the Deputy has the full authority of the Secretary.

That’s why it is critical that this Committee do its job in fully reviewing any nomination for this important post.

But I have to say at the outset that I have grave concerns about this nomination.

Conflicts of Interest

Mr. Bernhardt is no stranger to the Department of the Interior, or to this Committee. 

He held a number of senior political positions in the Department during the scandal-plagued Bush Administration, including as the Department’s Solicitor beginning in 2006. 

Since leaving the Department in January 2009, Mr. Bernhardt has returned to a very successful and lucrative lobbying practice.

He has represented a wide range of clients: oil and gas companies, mining companies, and water supply interests in California, to name just a few. 

Mr. Bernhardt was previously tasked with helping to oversee these same companies while at the Department of Interior. Now, Mr. Bernhardt is asking us for permission to walk back through that revolving door once again. 

To be clear: I am not suggesting that working for private industry alone disqualifies someone from public service. Not at all. But I am reminded of the positions some of my colleagues took during the Obama Administration.

Certain nominees before this Committee were rejected for supposedly outrageous offenses ranging from:

• working for a national environmental group; to

• serving on an advisory board; to

• Simply admitting to being mostly a vegetarian.

Those objections for disqualifying a nominee were patently absurd then, and they remain so to this day. 

Because of his extensive background as a lobbyist, Mr. Bernhardt has so many conflicts of interest, or the appearance of conflicts, that there will be one of two outcomes.

One, he will simply be unable to perform his duties as deputy secretary.

That’s because he will need to be recused from such a broad swath of the Department’s issues. Today, we do not even understand the full scope of those issues. 

His ethics agreement says he will not participate in “particular matters involving specific parties” in which his “firm is a party or represents a party.” But which matters?  Which parties?

Or two, he will manage the Interior Department despite his clear conflicts of interest, and he will end up participating in matters involving his former firm or his former clients.

Neither option is acceptable.

Moreover, the ethics rules only require him to recuse himself for two years, not the full length of his service.

Mr. Bernhardt has considerable experience with the work of the Department both from his service during the Bush Administration—

• as Counselor to the Secretary;

• as Director of Congressional and Legislative Affairs;

• as Deputy Chief of Staff;

• as Deputy Solicitor

• and as Solicitor—

and from his private practice as a lawyer and lobbyist for energy, mining, and water clients.

But his work for his clients also poses a serious problem.  It creates an inherent tension—or in the very least, an appearance of conflict— between the interests of his clients and the public interest the Department must serve and protect.

In the Reagan and Bush Administrations--James Watt, Gale Norton (who was investigated for allegedly giving preferential treatment to Shell and later taking a job with Shell), and Steve Griles (who was investigated for conflicts of interest and went to prison for obstructing a Senate investigation)—all came to the Department of the Interior after representing energy and natural resource clients. 

In their confirmation hearings they came before this Committee and assured us they could successfully “switch sides” and disassociate from their former clients. 

But their outlook, their frame of reference, the policies they pursued remained the same as those they had advocated on behalf of their clients.

These were policies aimed at monetizing the value of America’s natural resources and public lands—for the benefit of corporate profits, and at the expense of today’s taxpayers and future generations of Americans.

Already we have seen Secretary Zinke promise at his confirmation hearing to manage the Department in the model of Teddy Roosevelt.

Once confirmed, we’ve watched him launch an unprecedented war on our public lands and national monuments. What’s happened already during the Trump Administration likely has Teddy rolling over in his grave.

It took fewer than 100 days of Trump to attack almost 111 years of land conservation.

So, asking us now not to worry--to simply trust that recusal and conflict issues will be resolved--is not going to cut it. We need answers and additional specificity on how these policy and client matters will be handled.

The Bush-Norton Era

Mr. Bernhardt’s nomination raises the further concern that his prior service at Interior came during an era that was far from the Department’s finest hour.

He was the Department’s top legal officer at the time the Department’s Inspector General described it as having a [QUOTE] “culture of ethical failure.”

In September 2006, just before the Senate confirmed Mr. Bernhardt as the Solicitor, but after he had been serving 5 years in senior positions, including as Deputy Solicitor, the Inspector General testified before a House committee that—

 [QUOTE] “Simply stated, short of a crime, anything goes at the highest levels of the Department of the Interior.

“Ethics failures on the part of senior department officials — taking the form of appearances of impropriety, favoritism and bias — have been routinely dismissed with a promise 'not to do it again.'” [END QUOTE]

Both Secretary Norton and Deputy Secretary Griles were investigated for conflicts of interest.  

Deputy Secretary Griles was ultimately convicted and went to prison for obstructing the Senate Indian Affairs Committee’s investigation of the Jack Abramoff scandal.

Julie MacDonald, an Assistant Secretary in the Department, was forced to resign. 

She was found to have given internal agency documents to industry lobbyists, pressured agency scientists to withhold information, and improperly modified scientific data to further her agenda against the Endangered Species Act.

Drug use and misconduct between agency and industry staff, and rampant conflicts of interest were prevalent in the Mineral Management Service. 

The lax enforcement and oversight attitudes ultimately led to the complete restructuring of the agency. 

Mr. Bernhardt was in senior political leadership positions at the Interior Department for many of these events. 

He counseled the Secretary or served as her Deputy Chief of Staff or as the Department’s top legal officer throughout this period. 

Given his role in senior leadership throughout this time, I hope Mr. Bernhardt will be able to shed some light on the extent of his role in some of these matters—how much he knew about them at the time and what, if anything, he did about them.       

In light of all these concerns, I would hope Mr. Bernhardt appreciates the need for a higher degree of transparency. 

This is especially the case when it comes to managing the many conflicts of interest that arise from his large book of lobbying clients.

For example, Mr. Bernhardt has represented the Cadiz (pronounced (Ka-DEEZ) company, which is seeking to pump groundwater near the Mojave National Preserve in Southern California, to sell it elsewhere. 

His law firm has a unique compensation arrangement where the firm owns 200,000 shares of Cadiz stock and stands to realize additional compensation if certain milestones are met. 

Upon taking office, the Trump Administration quickly reversed the previous administration’s opposition to the project. At this time, we do not know whether this has anything to do with Mr. Bernhardt’s lobbying for the project.

We do not know if it has anything to do with the role he played on the Trump Transition Team—or possibly both.

But we do know Mr. Bernhardt’s clients and partners will receive major financial benefits if the Interior Department continues to green light this very controversial project. And we do know that the LA Business Journal reported earlier this month that Cadiz was able to raise $255 million in private equity investment, premised on Trump Administration approval.

Again, as Deputy Secretary, Mr. Bernhardt will likely supervise Interior’s role in this project in a day-to-day capacity.

There are many, many, other examples.

These examples include his work on behalf of the Westlands Irrigation District.

Westlands has been involved in very contentious litigation and lobbying against the Department’s policies in the ongoing California water wars.

 It includes serving as the lead attorney for the State of Alaska’s lawsuit, challenging the Department of Interior over its management of the Arctic National Wildlife Refuge.

It includes litigation and lobbying on behalf of Taylor Energy.

Taylor operates a well that has been leaking oil into the Gulf of Mexico since 2004—and has tried to avoid clean-up obligations.

So today, I will be very interested to hear Mr. Bernhardt’s explanation of his previous tenure at the Interior Department and how he intends to avoid the conflicts of interest--or appearance of conflicts--from his many clients with business before the agency.

The Department of Interior is the guardian of the public interest when it comes to stewardship of our public lands and natural resources.

The American public deserves sufficient information and transparency in the dealings of the Department’s leadership, to have confidence that taxpayers’ interests will be protected—rather than monetized for the benefit of a revolving door cast of polluters and corporate interests. Thank you.

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