Gingrich’s Path From ‘Flameout’ To D.C. Entrepreneur

A new poll released Wednesday by Time magazine and CNN finds Newt Gingrich staying ahead of Mitt Romney in three out of the four states with January primaries or caucuses.

Gingrich’s lead in the key primary states has sparked private discussions among President Obama’s advisers about the former Speaker of the House’s “realistic chance” of winning the Republican presidential nomination, CBS News reported.

Though Gingrich’s campaign is currently in debt, Gingrich himself has made a fortune. Over the past decade, Gingrich has “transfigured himself from a political flameout into a thriving business conglomerate,” writes Washington Post national political correspondent Karen Tumulty.

On Thursday’s Fresh Air, Tumulty — who has covered Gingrich for decades — talks about his quick rise in the 2012 presidential race and his appeal to Tea Party members, who see him as a “Washington outsider.” She also details how he became a wealthy man after leaving Congress, by what she describes as “playing the Washington system in an entrepreneurial way.”

Gingrich has generated millions of dollars in revenue over the past decade through his consulting practice, his lecture fees, an in-house literary agency and his for-profit think tank, which businesses join by paying annual membership fees ranging from $20,000 to $200,000, says Tumulty.

When he decided to run for president, Gingrich “disentangled himself from most of the firms,” she writes. But some of his business dealings continue to raise eyebrows in Washington, she says, including up to $1.8 million Gingrich received as a consulting fee from the mortgage giant Freddie Mac. Gingrich said he was acting as an “historian” for Freddie Mac — not a lobbyist.

“He argues that what he did was give them advice,” she tells Fresh Air‘s Terry Gross. “He also says he warned them that their business model was flawed. There is no secondary source that has been willing to confirm that. But the fact is, he was hired to help them promote their agenda. So I think this has become a big problem for him out on the campaign trail. And his opponents are going to say, ‘How are we supposed to press the arguments about Fannie and Freddie in next fall’s election if our standard-bearer was on their payroll?'”

Gingrich also received money from his nonprofit political advocacy group, American Solutions for Winning the Future. Before it closed last summer, the group generated more than $50 million in revenue. Some former officials of the organization have told Tumulty that the organization also provided money for Gingrich to travel by private jet and limousine to nonprofit events that coincided with his for-profit operations.

“Some of the former officials of American Solutions — [Gingrich] denies it — say that sometimes the bookkeeping was set up so that American Solutions would pay his travel expenses,” she says. “His own lawyers say they were very, very careful about the use of private aircraft … and that everything was properly billed. But former officials of his two enterprises — American Solutions and his for-profit enterprises — say that was not their impression.”

Karen Tumulty is a national political correspondent for The Washington Post. She has also written for Time magazine and The Los Angeles Times. She was awarded the Gerald Loeb Award for distinguished business and financial journalism in 1982 and the National Press Foundation Edwin Hood Award for diplomatic correspondence in 1993. She was previously on Fresh Air to discuss her brother Patrick’s health problems.


Interview Highlights

On what has been the most interesting part of covering the 2012 presidential primary

“I think everything we thought we could assume at the beginning has turned out to be so wrong, and Newt Gingrich’s resurrection is probably the very best case of that. Given where he was in June, I would have never thought he would even still be in the race at this point, much less leading it. And the stumbles — Republican races have generally been more like coronations. They figure out their front-runner usually in February of the year before the election and that person usually has a pretty straight-shot to the nomination. What we’ve seen this year has just been so remarkable.”

On the future of Gingrich’s candidacy

“Two big questions about Newt Gingrich I think right now are: whether he can maintain the type of discipline people expect of a presidential candidate [and whether] he can marshal the resources and organization that will carry him forward in this campaign beyond Iowa and New Hampshire and South Carolina. Because if this becomes a long, drawn-out primary — the kind we usually see in the Democrats — organization and money are going to matter a lot. We know that Mitt Romney has both of these things and it is yet to be seen whether Newt Gingrich can pull all of that together, especially because his surge has come so late.”

On the lack of support for Gingrich among Representatives who served in Congress with him

“I have found so many people who were in Congress at the time [Newt Gingrich was in Congress] who are very uneasy about this surge that they are seeing on Newt Gingrich’s part. One of his closest friends in the House was Minnesota Congressman Vin Weber. He’s now supporting Mitt Romney. I think that people in Washington who saw him in action are generally pretty uneasy. They’re worried about his lack of discipline in the past. They’re worried about his penchant for doing things that hurt the party. So you are not seeing very many of his former congressional allies supporting him.”

On Gingrich’s for-profit think tank

“He would not actually … pick up the phone and say, ‘Congressman X, would you agree to meet with Corporation Y.’ But he would arrange things like conferences where businesses would have a chance to rub elbows with policy makers. And another thing he would do, he would become a very public advocate for some of the causes … that were also good for these companies’ bottom lines.”

On Gingrich’s power in Washington in the mid-1990s

“For a while there, the House of Representatives was so powerful in Washington, that the then-president of the United States — Bill Clinton — actually had to assert one time, during a news conference, that he was still relevant. … [In 1994,] [Gingrich] brought into office, with his new majority, a new kind of politician — one who did not feel particularly beholden to the party structure. … People who didn’t have as much regard or respect for the structures of the institution. And I do think that the culture of the House has never been the same. And to some degree, the culture of the Senate hasn’t either.”

On Tea Party support for Gingrich

“A lot of Newt Gingrich’s support is coming from Tea Party members, from the grassroots. They see in Newt Gingrich a voice for their own frustrations with Washington and they also believe … that next fall, Newt Gingrich would be the man they’d want to see on a debate stage against Barack Obama. … They remember Newt Gingrich as very much a force for change in the party.”

On the government shutdown in 1995

“In 1995, [Gingrich] decided that he was going to get through a very large tax cut that was going to be paid for by reductions in Medicare spending. And that was actually the issue that led to the now-infamous government shutdown at the end of 1995. That was the point where the Democrats and Bill Clinton basically found his voice again. And Gingrich said, ‘I am going to push this, and if necessary I am going to shut down the government.’ And he did. And this shutdown went on for weeks, but ultimately the public saw this, it disapproved of this, and it very much blamed the Republicans for it. And I think in many ways, that laid the premise for Bill Clinton’s re-election in 1996. And after that, interestingly enough, we also saw a very productive period in the Congress.”

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