Hal Rogers Again Spares Legal Services Corporation; Controversial Program Must Be Completely Defunded

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LSC logoIn response to criticism that his first round of cuts did not go far enough, House Appropriations Committee Hal Rogers (R-KY) has now produced a continuing resolution with $100 billion in cuts. Amazingly, the Legal Services Corporation (LSC) again survived relatively intact.

Instead of a modest $75 million cut, Rogers has now increased the cut to a modest $85 million. Even the size of these cuts is illusory because they are off of President Obama's fiscal year 2011 budget figure of $435 million. When applied against the $420 million that LSC actually received in 2010, the latest cut is only $70 million.

If ever a program deserves to be zeroed out, it is LSC. Hal Rogers is well aware of LSC's history of controversy and corruption because he has chaired the appropriations subcommittee that has LSC oversight. He has offered a drumbeat of criticism, at times expressing exasperation with LSC leadership. But it is now clear that he is ultimately a protector of the program.

This is called playing both sides against the middle. For Rogers at least, it is business as usual on Capitol Hill. This is not acceptable. The Republican Study Committee budget proposal nixes any funding for LSC, a position that must be adopted by the leadership.

Meanwhile, LSC is using tax money to lobby for a continuation of its tax money. On Wednesday, LSC put out a statement claiming that the $75 million cut "would decimate civil legal aid to low-income Americans at a time when it is most needed by the tens of millions suffering economic hardship."

In the same statement, LSC Board Chairman John G. Levi said:

Justice is a hollow promise without LSC. The Corporation and its national legal services network turn the abstraction of equal access to justice into a living, everyday reality for millions of low-income Americans. They are the most vulnerable in our society, and it is our responsibility as a country to make sure that our justice system works for them irrespective of the state of the national economy.

These are pretty high-minded comments from a political appointee who is more likely breathing a sigh of relief that his fat per diems to attend LSC board meetings may well continue.

It is also ridiculous. LSC did not exist until 1974, so I doubt the promise of justice was hollow before then. It also assumes that the only way a poor person can get a lawyer is thorough LSC. In fact, the majority of pro bono legal work for the poor takes place outside of LSC.

And in recent years, non-LSC funding for grantees has grown to about 65% of their support.

The real LSC beneficiaries are lawyers. With a federal program whose purported mission is to help poor people with their legal problems, attorneys are relieved of the social obligation of performing pro bono work. Fortunately, many lawyers take this responsibility seriously anyway.

It is not known to what extent LSC grantees have joined to lobbying to preserve their federal subsidy. If the past is any guide, it could be substantial. In my 1996 biography of Hillary Rodham Clinton titled The First Lady, I detailed the LSC's illegal "survival campaign" of the early eighties. Here are some excerpts:

Meeting only days after the 1980 election, over 100 key LSC officials and staffers met at a luxury beach hotel in San Juan, Puerto Rico to map plans for survival. Air fare alone cost taxpayers over $100,000. The campaign eventually included everything from political training sessions to the transfer of hundreds of thousands of LSC dollars to sympathetic outside organizations. Eight regional training sessions took place around the country...The Denver session was captured on videotape. Alan Rader of the Western Center for Law & Poverty...stated that the legal services program had always been implicitly political, and that it was time the participants became explicitly political. He asserted that the campaign "puts our attention where it ought to be: which is on the central arena in which the critical issues confronting our clients can be decided over the years-- and that's the political arena, not the legal arena."

During this period, local LSC offices were advised to have their receptionists respond to poor people who called their offices with problems in this fashion, "I'm sorry but at this time we are unable to handle this kind of case. Due to the recent proposed federal cutbacks, we have had to reduce our caseload drastically. It would be unethical for us to take any cases."

The survival campaign continued unabated until early 1982 when the Reagan Administration belatedly got around to replacing the Carter board. During the last days of the Rodham regime, millions of dollars were essentially looted from LSC coffers to continue the survival campaign. This frenzied giveaway was a part of the campaign known as "saving the rubies," a reference to Czar Nicholas sending the Russian Crown Jewels to Switzerland for safekeeping during the 1917 Bolshevik revolution.

An LSC grantee, the National Legal Aid and Defenders Association (NLADA) became the "corporation in exile." A yearly recipient of no more than $100,000 in LSC support, NLADA received $2.2 million in late 1981. The grant contracts were most curious documents, waiving many of LSC's standard rights and NLADA's obligations. For instance, the requirements that NLADA abide by LSC guidelines and audit procedures were deleted. There were other things even more curious. Thousands of dollars in audio-visual equipment was simply moved from LSC offices to NLADA. LSC staff members responsible for awarding the grants went on the NLADA payroll upon leaving LSC.

During Senate hearings in 1983, LSC President Dan Bradley admitted that Chair Hillary Rodham and the other LSC board members were repeatedly advised of, and updated on, the illegal survival campaign carried out by himself, Alan Houseman, and other LSC officials. For example, a 1981 Houseman memo detailing the campaign had been provided to the board. The board also asked for and received weekly updates on the "progress" of the effort. Thus, Hillary knew about the lobbying activities as a result of communications from the LSC staff. As Chair she had a binding legal duty to stop this illegal activity, yet did nothing about it.

When the Reagan-appointed board finally gained control of LSC, many of the files from the 1980-82 period were missing, particularly those pertaining to the survival campaign. Documents had to be pieced together from copies obtained from LSC regional offices and individual programs.

It was these documents that led to explosive oversight hearings conducted by the Senate Labor and Human Resources Committee chaired by Sen. Orrin Hatch (R-UT) in 1983. For the first time, the massive and unlawful scope of the survival campaign was exposed. Longtime legal services supporters were so defensive that Senator Edward Kennedy (D-MA) stalked out of the hearing rather than sit through a viewing of a videotape of Rader's infamous Denver presentation.

Sen. Jeremiah Denton (R-AL), a Committee member, noted, "The political abuses by LSC and many of its grant recipients were not simply isolated anomalies. They were the business of Legal Services. They were committed on a national scale and were planned by key members of the LSC's national leadership."

He went on, "The diversion of those funds meant that individual poor people were denied direct legal assistance which taxpayers assumed they were funding. These poor people with very real legal problems were turned away because their attorneys were too busy. Too busy doing what? Saving their own jobs. In refusing to perform their duty while performing illegal or improper acts, Legal Services lawyers have, in effect, robbed the poor."

Committee Chairman Hatch concluded, "Their method was clandestine; their objective was secret; and their actions were repugnant. And yet they fully expected the federal government to finance their cabal."

A 1983 General Accounting Office investigation likewise concluded that the LSC survival campaign had violated the law, prompting a criminal investigation by the Justice Department. In July of 1984, a frustrated Assistant Attorney General Stephen S. Trott announced,

...the unauthorized activities of the Corporation, and many people associated with it, are uniquely reprehensible and beyond the scope of LSC's original mission...not withstanding these inappropriate, misguided, and abusive activities, 18 U.S.C. Sec. 1913 as well as the federal theft and fraud laws- for technical reasons- were not violated by the lobbying activities involved here."

The "technical reasons" resulted from the way the Legal Services Act was written. It provides no recourse against those who violate the prohibitions on the use of legal services funds. The Justice Department simply had no course of action to prosecute.

Republicans (and Democrats) who wish to actually reduce spending in the face of a $1.267 trillion deficit must be aware that a government program, no matter how troubled or discredited, will fight tooth and nail for its own survival. LSC funds a grass-roots network that can be put to the purpose of lobbying. Congress must resist this campaign and put taxpayers' interests first.

Related:

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Ex-Maryland Legal Aid Group CFO, Businessman Sentenced for $1 Million-Plus Fraud

Taxpayers Fund Cronyism, High Living at Louisiana Legal Services Grantee

Federal Audits Reveal Further Legal Services Abuses

Legal Services IG Criticizes Italian Marble at Anti-Poverty Office