Give him the keys to the henhouse.
A senior lobbyist at the National Association of Manufacturers nominated by President Bush to lead the Consumer Product Safety Commission will receive a $150,000 departing payment from the association when he takes his new government job, which involves enforcing consumer laws against members of the association.
The lobbyist, Michael E. Baroody, wrote recently to the commission’s general counsel that the severance was an “extraordinary payment” under a federal ethics rule, requiring him to remove himself from agency matters involving the association for two years. Under the rule, a payment is “extraordinary” if an employer grants it after learning that the employee is being considered for a government position and it is not part of an established compensation or benefits program.
Mr. Baroody said in the letter that the payment would not prevent him from considering matters involving individual companies that are members of the manufacturers’ association, many of whom are defendants in agency proceedings over defective products or have other business before the commission. Nor would it preclude him from involvement with smaller trade groups like those representing makers of home appliances and children’s products that have alliances with the association.
The nomination of Mr. Baroody, executive vice president at the association, has provoked heavy criticism from Democrats and consumer groups. He is the latest in a line of industry officials and lobbyists to be given senior jobs by Mr. Bush at federal safety agencies that oversee matters like workplace and mine safety and transportation as the administration has sought to roll back hundreds of regulations that businesses viewed as excessive.
The White House, Mr. Baroody and the commission would not make available the letter that Mr. Baroody wrote describing the $150,000 payment. A copy was provided by a Democratic Congressional aide who found it in Mr. Baroody’s nomination file in the Senate.
A spokeswoman for the White House, Emily Lawrimore, said the administration was satisfied that Mr. Baroody “has taken the steps necessary to avoid any conflict of interest in the event he is confirmed.”
Experts in executive compensation said it was unusual for someone to be paid under a severance agreement for voluntarily leaving to take a top position at another organization.
“Severance agreements are usually a safety net for the employee,” said Don B. Lindner, head of the executive compensation practice at WorldatWork, a professional organization previously known as the American Compensation Association that provides training and certification for compensation and benefits professionals. “It would be unusual to have a severance agreement triggered by a person leaving on a voluntary and positive basis. It’s usually used for a job that has been eliminated or cut back, or a person that’s been asked to leave.”
Mr. Baroody’s nomination will be before the Senate Commerce Committee next week. He is opposed not only by consumer groups but also by trial lawyers, firefighters and pediatricians. They have highlighted what they say are repeated actions taken by Mr. Baroody and the association on behalf of companies that have made consumer products less safe.