Wall Street’s New Propaganda Czar is the Man Who Sold the Iraq War
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Guess Who’s Selling Wall Street’s Bull?
Hint: He was a Bush aide who cooked up a phony pitch for the Iraq War.
The strategic communications specialist advising a financial industry effort to enhance Wall Street’s image has plenty of experience in spinning the American public: In the Bush White House, he was one of the aides in charge of the administration’s fact-bending campaign to sell the Iraq War.
Bloomberg reported on Thursday that Jim Wilkinson, a one-time senior aide to former Treasury Secretary Henry Paulson, is part of a campaign, spearheaded by the Securities Industry and Financial Markets Association (SIFMA), to quell the upsurge of “populist” anger directed at the financial sector. But the story leaves out an important part of his résumé: He’s a GOP PR operative with a history of disseminating misleading information and once served as the deputy communications director in the Bush White House.
In the run-up to the Iraq War, Wilkinson was a member of the White House Iraq Group, which devised the administration’s information offensive making the case for deposing Saddam Hussein. He played a key role in drafting “A Decade of Deception and Defiance,” a white paper circulated in September 2002. The report outlined the myriad ways in which Saddam’s regime had flouted international sanctions, along with its alleged pursuit of weapons of mass destruction and supposed links to terrorism. The paper, riddled with information that has since been debunked, relied in part on the claims of an Iraqi defector, Adnan Ihsan Saeed al Haideri, who had previously been deemed unreliable by intelligence officials. Nevertheless, the document was released to back up Bush’s speech to the UN General Assembly on September 12, in which the president laid out a host of allegations against the Iraqi dictator. Among other things, Bush claimed, “Iraq has made several attempts to buy high-strength aluminum tubes used to enrich uranium for a nuclear weapon. Should Iraq acquire fissile material, it would be able to build a nuclear weapon within a year.”
By November 2002 Wilkinson had been installed as Central Command’s (CENTCOM) director of strategic communications, where he coordinated the administration’s information campaigns on Afghanistan and Iraq. As the military’s “Shock and Awe” campaign commenced in March, Wilkinson presided over press conferences at the military’s forward base in Doha, Qatar, where reporters were fed a daily dose of spin and misinformation.
In an updated version of The First Casualty, a comprehensive account of journalism during wartime, Phillip Knightley writes that in Doha:
stories were floated, picked up, exaggerated, confirmed and then turned out to be wrong. Basra was secured—it fell seventeen days later. Um Quasa fell daily. Saddam Hussein had been killed; Tariq Assiz had defected—both stories were wrong. There was an uprising in Basra that never happened even though Central Command announced at a briefing that it had. Was this deliberate strategic disinformation?
At one point, Wilkinson claimed that Saddam’s forces were seeking uniforms “identical down to the last detail” as those worn by US and British troops. He said Saddam’s Fedayeen intended to “wear them when conducting reprisals against the Iraqi people so that they could pass the atrocities off as the work of the United States and the United Kingdom.” His claim was never corroborated. Wilkinson was in also in charge of CENTCOM briefings when the phony story about Private Jessica Lynch’s dramatic capture and rescue was floated, though, when this incident was later probed [PDF] by a congressional panel, he claimed he was unaware of the source of the false information provided to the press.
Wilkinson (who’s also credited with promoting the 2000 campaign meme that Al Gore said he created the Internet) later moved on to the Treasury Department. There he served as Paulson’s senior strategist and adviser, counseling the treasury secretary and former Goldman Sachs CEO on crisis management and other matters. At the close of the Bush administration, he joined the powerhouse international PR and communications firm of Brunswick Group. In March, Michele Davis, who’d served as Paulson’s public affairs director, signed on with the firm as well.
Along with Davis, Wilkinson is now fighting a new information war, on behalf of embattled finance firms yearning for the days when million-dollar bonuses and luxury retreats were none of the public’s business. The pair are part of a Brunswick team that’s devising SIFMA’s PR campaign, which earns the company a retainer of $70,000 a month. The strategy, according to documents obtained by Bloomberg, calls for a “city-by-city, grass roots” effort targeting such international hubs as New York, London, Washington, and Brussels. The goal: to convince the public that Wall Street is open to reform, and is part of the solution, not the problem. But what does it say about Wall Street’s commitment to change that it turned to a man notorious for misleading PR campaigns to sell the US public on its transformation?
Wall Street Sets Campaign on ‘Populist Overreaction’
By Robert Schmidt, Bloomberg
Wall Street’s largest trade group has started a campaign to counter the “populist” backlash against bankers, enlisting two former aides to Treasury Secretary Henry Paulson to spearhead the effort.
In memos of confidential meetings with top financial executives, the Securities Industry and Financial Markets Association said it began this month the “execution phase” of the operation, which pledges to “embrace change” and accountability. The plan targets policy makers and the media in New York, London, Washington and Brussels and calls for a “city-by-city, grass roots” approach.
The securities industry “must be perceived as part of the solution, which will allow it to better defend against populist overreaction,” the documents, prepared for a June 17 meeting of SIFMA’s board, said.
The board meeting minutes and staff-written papers, obtained by Bloomberg News, outline the program crafted by polling, lobbying and public relations companies paid at least $85,000 a month. The memos provide a glimpse, in often candid language, into how Wall Street is grappling with its pariah status.
“It is imperative that in this historic period of reform, the industry be recognized as playing a positive role in seeking change and providing solutions to the problems we face,” one of the documents said. “There is currently widespread skepticism about the industry’s commitment to this needed change.”
The internal papers call for using regional securities firms, many of which have escaped notoriety in the financial crisis, to push the industry’s message with their local members of Congress. The plan notes that brokers across the country can also be used.
“The foot power of the private client group has proven to be effective in blunting populist messages in the past,” said board member Paul Purcell, chief executive officer of Milwaukee investment firm Robert W. Baird & Co., according to the minutes of one meeting.
To advise on the strategy, the trade group turned to a bipartisan roster of consultants. Such advice doesn’t come cheap and SIFMA is discussing dipping into its reserves to cover some of the costs, according to one memo.
Michele Davis, Paulson’s former spokeswoman, and Jim Wilkinson, his former chief of staff, are among those leading the effort. SIFMA is paying their firm, Brunswick Group LLC, a monthly retainer of $70,000, the documents show. Both Davis and Wilkinson declined to comment. Paulson left office in January.
Assisting them is a Democratic polling company, Brilliant Corners Research and Strategies, which is paid $5,000 a month. It is run by pollster Cornell Belcher, who worked on President Barack Obama’s campaign. BKSH & Associates Worldwide, a lobbying firm chaired by Republican strategist Charlie Black, signed on for $10,000.
In response to questions about the push for an image makeover, SIFMA President Timothy Ryan said the organization has taken a lead advocating for a federal systemic risk regulator and has pushed for increased government power to wind down financial firms that don’t own banks. He also touted the group’s recently issued recommendations on executive compensation.
“This effort, which is not uncommon for a trade association, is designed to ensure our ideas for improved accountability, oversight and transparency are heard by the widest possible audience,” Ryan said.
The industry has “a duty to help craft a solution, so we’ll continue leading by example in our efforts to properly safeguard our financial system and serve the needs of the overall economy, local communities and individual investors,” he added.
SIFMA represents about 600 securities firms, brokerages and asset-management companies. It counts among its members the biggest U.S. banks, including Goldman Sachs Group Inc., Citigroup Inc. and JPMorgan Chase & Co., which have received capital injections from the $700 billion Troubled Asset Relief Program. Bloomberg Tradebook, a broker-dealer subsidiary of Bloomberg News’s parent Bloomberg LP, also belongs.
While financial companies’ lobbying clout has been reduced in the crisis, SIFMA’s memos said that Wall Street can’t afford to be left out as the Obama administration and Congress push for increased oversight, executive-pay limits and other restrictions likely to affect the industry for decades.
“The mess is so big that we all have to work together,” minutes from one meeting said.
‘Lot of Anger’
The group’s polling “indicated that there is a lot of anger out there and feelings that the industry is not focused,” the minutes said. While “Wall Street and CEOs” received low scores, local banks and brokers got better marks.
That tracks with a new poll by ShareOwners.org, an Internet site backed by investor advocates.
The survey of 1,256 U.S. investors through Opinion Research Corp. found 34 percent are “angry” about “the debacle on Wall Street and the related failure of regulatory oversight,” ShareOwners.org said. It found 58 percent are “less confident in the fairness of the financial markets” today than a year ago, the company said.
The outside consultants join SIFMA staff for a daily 10:00 a.m. conference call, “given the importance, complexity and real-time nature of the campaign style-implementation,” according to one of the memos.
Still, that kind of approach may not be enough for Wall Street to lift its reputation, said Bill Brown, a visiting professor at Duke University School of Law in Durham, North Carolina.
“It’s right for them to try to come back from this, but they have to realize that they are not going to be reborn into what they were,” said Brown, who was global co-head of listed derivatives at Morgan Stanley. “The best P.R. comes from doing good, not from having to manage your image.”
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