No wonder Bill looks so happy…

In the middle of instituting two rounds of major layoffs in 2012,  the non profit Washington Hospital Center gave Bill Clinton a whopping $225,000 speaking fee  to appear at its annual Cardiovascular Research Technologies conference, where Clinton expounded on health care reform and his own battle against heart disease. The hospital didn’t disclose the $225,000 payment on its annual Internal Revenue Service forms, but it surfaced on the list of income sources the ex-President provided on his wife’s required ethics filing as Secretary of State. This waste of precious funds is unconscionable, and it is also all too common.

The story was originally broken by the Washington Times, with its angle being that Clinton was the villain. I will always enjoy a little Clinton-bashing, but that is unfair and ridiculous. No one forced the hospital to pay such an exorbitant fee. No one forces any organization to pay such speaking fees; if organizations wouldn’t pay them, Clinton and other blue chip speakers would charge what the market would bear. Both Clintons charge in this range to speak, and remember, the time they devote to spreading their pearls of wisdom is typically an hour or less. Non profits as well as deep pocket corporations like Goldman Sachs, American Express and Fidelity Investments also pay the fees or similar ones, and it is an abuse of discretion whether the payer is a non profit or not. *

From the Times story:

 “The hospital is hardly the only 501(c)(3) organization to shell out big money to hear Mr. Clinton speak. The Naples Philharmonic Center in Florida paid Mr. Clinton $200,000. Later, the nonprofit filed IRS forms showing that it lost $338,000 in overall revenue of about $24 million that same year. Another organization listed on Mrs. Clinton’s ethics form, the Bushnell Center, shelled out a six-figure check to Mr. Clinton. IRS forms show it reported a $1.8 million deficit during the same tax year it hired the former president.

…Washington Hospital Center officials confirmed their payment to Mr. Clinton… So Young Park, a hospital spokeswoman, said   the meeting generates “net revenue” for the hospital but declined to provide any details about how much money the conference raised or what portion of that revenue officials believed came from people coming to hear Mr. Clinton’s speech.”

That is because the claim that such big ticket speakers draw significant attendees is a convenient myth. I’d be shocked if a more than handful of attendees decided to shell out the  resources it takes to attend a conference—registration fees, hotel, meals, air fare—because Clinton was speaking. The fees can’t be defended in a business context, or any other. So why do organizations do this?

I saw the corrupt and foolish process up close when I oversaw conventions for a major Washington lawyers association in the 1980’s. One year, with the association in a cash crunch and facing falling membership, the organization president and executive director insisted that we hire a pre-Tonight Show Jay Leno for the opening convention dinner at the whopping cost of $75,000 for a 45 minute routine. We couldn’t afford it; he wasn’t going to draw attendees. No, the real reason was clearly that the honchos in charge just liked the idea of bringing in a big name like Jay Leno and wanted to be able to say that they hired him. It was irrational, that’s all. When other organizations do this with political figures like the Clintons, there may also be some vague and foolish hopes that the big check may buy a futile favor, but the basic decision-making process is the same. This is starry-eyed, celebrity-driven, juvenile, managerial recklessness, and any organization that sees such fees paid out, whether the group is flush or swimming in red ink, should punish those responsible, ideally with pink slips. No hour long speech is worth six figures, to its audience or its host. Even elite professional athletes don’t earn $200,000 an hour.

Speaking of the Washington Hospital Center deal, Dan Fields Jr., president of the Service Employees International Union Local 722 representing hospital workers, told the Times, “No disrespect to Bill Clinton, but that money could’ve gone a long way and been put to better use.” $225,000 could hardly be put to worse use. Clinton isn’t hurting for money. The tangible benefits are nil; the likelihood of anything Clinton says being life-changing for an attendee is slim at best. Clinton and any other celebrity speakers have a right to ask for any fees they choose, and responsible organizations, especially non profits,  have an ethical obligation to laugh in their faces, offer 20,000 bucks (or less) plus travel expenses, and say take it or leave it.

By the way: I’ll do an hour on ethics for $5000, and I guarantee the attendees will learn more from me than they do from Bill. They will learn, for example, why it’s unethical for a non profit to waste charitable funds and grants lining the pockets of the likes of William Jefferson Clinton.

* Note: The hypocrisy of conservatives attacking Clinton on this basis is neon bright. They defend outrageous corporate executive salaries and golden parachutes as free market choices, but attack an ex-President for accepting a speaking fee achieved on the open market.

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Pointer: Newsbusters

Source and Graphic: Washington Times