Political Clout Earns Place on Brown’s Trade Missions : Government: Business leaders who join commerce secretary on trips are often well-connected party backers.

Among the business executives who accompanied Commerce Secretary Ronald H. Brown on a trade mission to South America last year, E. Glenn Biggs seemed out of place.

Biggs was not the chief executive officer of a major U.S. corporation, like so many members of the delegation. Nor was he one of the minority delegates who were chosen for racial and ethnic diversity.

Rather, the 60-year-old Texas businessman had another qualification that made him a prime candidate for the honor of accompanying the secretary of commerce on the overseas trip: political influence.

In a letter Biggs wrote to Brown on May 31, 1994, asking to be chosen for the trip, he mentioned pointedly that he was a longtime friend of then-Treasury Secretary Lloyd Bentsen, as well as of former Democratic Party Chairman and Ambassador Robert S. Strauss. In passing, he also noted that he recently had lunch with the current treasury secretary of Mexico.

“As I understand, you have proposed a trip to Argentina, Chile and Brazil, which I desire to be a part of,” Biggs wrote in his letter, which also listed his business credentials. “In speaking with the secretary of the Treasury, it was suggested that I provide this information to you and your kind office.”

In an interview last week, Biggs acknowledged that he had mentioned both Bentsen and Strauss, who served in Moscow during the George Bush Administration, but said the name-dropping was not intended to bring political pressure to bear on the department.

Biggs is by no means the only person who appears to have used political ties to get a coveted seat on the plane that carries Brown and his handpicked entourage on official trade missions to South America, Russia, the Middle East, China and India. Recently released internal Commerce Department documents show that many well-connected Democrats exerted influence on the selection process.

These documents have served to reinforce the growing complaints among members of the business community that Brown, the former chairman of the Democratic Party, plays favorites in deciding which companies will get his valuable help in overseas markets.

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“By and large, some companies are having their bread buttered for them,” said Larry Klayman, an international trade lawyer and head of the privately funded group Judicial Watch, whose lawsuit resulted in the release of 30,000 Commerce Department documents on the trade missions. “What they are doing is a real perversion of our free-market economic system.”

Of course, it is not unusual for government officials to make choices based on friendships or political connections. Many of Brown’s predecessors at the Commerce Department--most recently President George Bush’s appointee, Robert A. Mossbacher--were accused of using their office to butter up influential political supporters and contributors.

But Brown’s activities have come under special scrutiny because he, unlike his recent predecessors, has been such a high-profile and activist commerce secretary, intervening personally on behalf of numerous U.S. business interests abroad.

The very strategy that has caused Brown to be so widely hailed by many corporate executives as the most effective commerce secretary of recent times has also infuriated free-market purists such as Klayman, who feel that U.S. business should compete in the world market without government help or interference.

“Whenever you help company A, you also--by definition--hurt company B,” Klayman said. “The Commerce Department, under President Clinton, is spending hundreds of millions of dollars to distort the market. This type of corporate welfare is inexcusable.”

That is precisely the view that led many Republicans recently to endorse the idea of abolishing the Commerce Department. Thus, even though Brown’s activities have a pro-business tilt generally favored by the GOP, his success could very well help endanger his agency.

The story of how Biggs and other politically well-connected people were chosen for Brown’s trip is significant because it dramatizes one factor in the increasing skepticism about the aggressive style of this Commerce Department.

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By the official criteria established by the Commerce Department, Biggs did not seem to qualify to be a top candidate for Brown’s trade delegation.

Records show that the two essential qualifications set for the entourage were the two “D’s”--”deliverables,” such as a pending business deal that could be announced at the end of the trip, and diversity. In addition, Brown usually demanded that his traveling companions be the highest-ranking executives of their companies.

Nevertheless, Brown had no shortage of eager applicants. His files contain hundreds of letters from business people seeking to travel with him.

What attracted these applicants was the opportunity to gain stature in the eyes of foreign officials by being introduced by Brown. As these executives see it, it is easier for them to negotiate deals overseas if they have the implied imprimatur of the U.S. government.

A Brown trip also was seen by some executives as a good way to hasten the closure of pending business deals. “It’s like a summit meeting--it speeds things along,” said Daniel P. Burnham, president of AlliedSignal Aerospace, who concluded a $150-million contract to provide helicopter engines to an Indian manufacturer during his visit with Brown to Bangalore.

Why certain applicants were accepted and others rejected was never explicitly stated in the decision-making memos. But the documents indicate that politics was always a consideration.

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One official confided in a memo that Jude Kearney, deputy assistant secretary for trade development at the Commerce Department, had told him “that the politics of the situation were important and he, as a political appointee, would push those that were politically connected.” Kearney, an Arkansan and ex-Clinton aide, played a role in the process.

But the person who appears to have exerted the most influence on Brown’s decision was Melissa Moss, the Democratic National Committee’s former principal fund-raiser who now runs the department’s advocacy center, to assist U.S. firms in competing in global markets. GOP critics often have complained that Moss’ appointment provided a convenient nexus between political influence and export promotion.

In addition to Bentsen, the many Democrats who contacted Brown and Moss, seeking to influence their choice of people to accompany the secretary, included Democratic powerbroker and former Rep. Tony Coelho, Sens. John B. Breaux (D-La.) and Ernest F. Hollings (D-S.C.), Los Angeles attorney Johnnie L. Cochran Jr. and then-White House Deputy Chief of Staff Phil Lader.

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Their appeals often had an ingratiating tone. For example, R.J. Bartnik, a lobbyist for Raytheon, told Brown: “It was really great seeing you this past weekend. It certainly was like ‘old home week’ with yourself and Alma [Brown’s wife] and the DNC Business Leadership Forum Conference.”

Coelho, an expert Democratic fund-raiser, told Moss that “your help means a great deal to me, personally,” in obtaining a seat for his boss, James A. Harmon, chairman of Wertheim Schroder & Co. in New York.

From the right people, such entreaties were sometimes all it took to put a name on a trip list. Like Biggs, Coelho’s boss was instantly added.

Biggs was not even mentioned in any of the early planning documents for the South American trip. But by May 31, even before his own letter arrived at the department, his name was on a confidential list of people whose credentials were being researched as possible traveling companions for Brown--apparently as a result of a fax sent by the Treasury Department.

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Signed by Jim Fall, the Treasury fax stated simply: “Secretary Bentsen would be greatly appreciative of any assistance you could offer in Mr. Biggs’ joining Secretary Brown on the trip to Latin America in June.”

Biggs said his ties to Bentsen are purely personal, even though he was a frequent contributor to Bentsen’s Senate campaigns.

The Treasury Department’s fax arrived about the same time Brown received a similar letter from Ronald L. Platt, a former Bentsen aide who now works as a Washington lobbyist. Until Brown was appointed as commerce secretary in 1993, he and Platt were both partners at the Washington lobbying firm of Patton, Boggs & Blow. Platt said he intervened at the request of Diamond Shamrock, a refiner and marketer of petroleum products, which is represented by his current lobbying firm, McDermott, Will & Emery.

By June 3, three days after Bentsen intervened, Brown sent a letter of invitation to Biggs. During the same period, the names of other people with equal, if not better, credentials were trimmed from the list.

While Biggs was chosen for the delegation as a representative of Diamond Shamrock, he is not even a full-time employee of the company. Instead, he serves on the board of directors of many organizations, including Diamond Shamrock.

“Although I’m not in the management of the company,” Biggs explained, “I am very, very close to it.” He said he was chosen because Diamond Shamrock CEO Roger Hemminghaus was unable to go.

Nor did Diamond Shamrock have any new business deals pending in South America. Instead, the Texas petroleum company was seeking Brown’s discreet help in settling a tax dispute with Argentina.

There is no evidence in the internal memos that Democratic contributors were always favored over non-contributors in the selection process, although many of those chosen were big donors. Biggs has given $8,500 since 1985; Diamond Shamrock executives gave $38,500 in the same period.

Before each of Brown’s trips, the business participants were asked to specify the names of the officials they desired to meet in each country. In Buenos Aires, Biggs listed officials who could help solve Diamond Shamrock’s tax dispute with the government of Argentina.

As a result, when Brown met separately with Argentine President Carlos Menem and Economy Minister Domingo Cavallo, he was accompanied by Biggs. The so-called “talking points” that Brown’s staff provided him for the meeting said, in part: “I hope the [government of Argentina] will make every effort to resolve the current export tax credit problem with Diamond Shamrock.”

Kathy Hughes, spokeswoman for Diamond Shamrock, said Brown persuaded the government of Argentina to issue a ruling favoring the firm’s subsidiary, Sol Petroleum, saving the company between $20 million and $30 million.

At the end of each trip, Brown presides at the announcement of many successful business deals concluded in each country. By his own estimate, his efforts on behalf of American exporters have produced $25 billion in business revenues for the United States.

As the South American trip drew to a close, however, Brown made no public announcement that he had resolved a tax dispute for Glenn Biggs and Diamond Shamrock.