How Mitch McConnell and Elaine Chao turned a Kentucky town into their personal swamp

Senate Minority Leader Mitch McConnell of Ky.,  joined by his wife, former Labor Secretary Elaine Chao, celebrates with his supporters at an election night party in Louisville, Ky.,Tuesday, Nov. 4, 2014. (Photo: J. Scott Applewhite/AP)
Then-Senate Minority Leader Mitch McConnell, R-Ky., joined by his wife, former Labor Secretary Elaine Chao, celebrates with his supporters at an election night party in Louisville, Ky., Tuesday, Nov. 4, 2014. (Photo: J. Scott Applewhite/AP)

WASHINGTON — The small western Kentucky town of Paducah loves Mitch McConnell. Even if progressives loathe McConnell for his ruthless effectiveness as master of the Senate, and even if plenty of his fellow Kentuckians disapprove of his performance, he can always find a warm embrace here on the banks of the Ohio River.

McConnell is not a native son of Paducah; he was born in Alabama and moved as a child to Louisville, the state’s biggest city. But he might as well call it home, for while Louisville is one of Kentucky’s few Democratic redoubts, Paducah is as red as blood. When McConnell was running for reelection in 2014, Paducah voted for him over his Democratic opponent, Alison Lundergan Grimes, at twice the rate of the rest of the state.

Analysis of campaign contributions shows that Paducah gave McConnell a total of $331,029.50 in 2013 and 2014. For a town whose population is only about 25,000 people, that averages to more than $13 for every man, woman and child. By contrast, Louisville gave McConnell $4.64 per citizen. Lexington gave $1.62.

Why does Paducah love McConnell so much? Probably because for years, he and his wife, Elaine Chao — currently the transportation secretary and previously, under George W. Bush, the secretary of labor — have carefully cultivated and courted Paducah’s interests in ways that critics charge improperly mix their responsibilities, so that the politics of one can appear indistinguishable from the policy of another.

Over the past decade and a half, Paducah has reaped $509 million in funds from federal departments Chao has been in charge of, according to Restore Public Trust, a progressive group that has tracked the Chao-McConnell relationship. Outwardly, that funding appears to violate no laws, but critics say it is improper all the same.

“The facts are clear — Secretary Elaine Chao helped her husband politically through Department of Transportation grants, through Department of Labor grants, and she used her position to campaign for him,” Lizzy Price, a spokesperson for Restore Public Trust, told Yahoo News. “Taxpayers don’t pay Secretary Chao’s salary so that she can boost her husband’s political career. Chao’s actions are as swampy as Trump’s administration gets and merit a thorough investigation.”

Price and others say that Paducah is a perfect case study of how Washington’s most powerful couple have tended to the very kind of swamp Trump promised to drain. They have done so strategically, consistently and with little notice, according to those making such accusations. And they have done so for years.

Paducah is hardly the only example. Politico recently reported that Chao fast-tracked projects favored by McConnell in Owensboro, another Kentucky town on the Ohio River. There, as in Paducah, Chao pushed for projects that McConnell supported and that appeared to benefit him politically.

A spokesperson for the Department of Transportation, where Chao has served as the secretary since the beginning of the Trump administration — and, until recently, without the kind of controversy that has befallen some of her colleagues — took umbrage at suggestions that she was susceptible to such influence. He said that stories like this one are “political hit jobs filled with innuendoes” being pushed by progressive groups funded by Democrats eager to find any and every way to hobble the Trump administration. The spokesman added that “no state or senator receives special treatment,” adding that career staff evaluate grant proposals in a way that insulates them from influence.

Elaine Chao (2R) is sworn in as US Transportation Secretary by Vice President Mike Pence (R) as her father James Chao (2L) and her husband Senate Majority Leader Mitch McConnell look on in Washington, DC, on January 31, 2017. (Photo: Nicholas Kamm/AFP/Getty Images)
Elaine Chao is sworn in as transportation secretary by Vice President Mike Pence, right, as her father, James Chao, second from left, and her husband, Senate Majority Leader Mitch McConnell, look on in Washington, D.C., on Jan. 31, 2017. (Photo: Nicholas Kamm/AFP/Getty Images)

McConnell’s staffers and supporters say it is absurd for him to face criticism for doing what a politician is supposed to do: agitate with the federal government for what his constituents want or need. They say that he has never exercised improper influence with Chao. In response to questions from Yahoo News, McConnell’s office sent a multipage document celebrating the many projects he has supported in Paducah, including several that Yahoo News had not asked about, making clear that, in the veteran senator’s view, the work that detractors are questioning should, in fact, be praised.

“Kentucky continues to punch above its weight in Washington, and I am proud to be a strong voice for my constituents in the Senate,” McConnell told Yahoo News in a statement, reiterating what he has said earlier in response to similar allegations. “As the only one of the four congressional leaders who isn’t from the coastal states of New York or California, I view it as my job to look out for middle America and of course Kentucky in particular. That means I use my position as Majority Leader to advance Kentucky’s priorities.”

Critics say, however, that McConnell has exerted influence all the same, albeit in ways that are difficult to track. Briefed on the issue, former George W. Bush ethics lawyer Richard Painter said that Chao could have a “Kellyanne Conway problem,” referring to the senior Trump official who was recently criticized for allegedly violating the Hatch Act, which prohibits federal employees from using their office to promote partisan goals. Trump has defended those alleged violations, which include sharply worded attacks on Democrats, as nothing but Conway’s exercise of her First Amendment free-speech rights.

“The House of Representatives should investigate, see what they can find” about Chao’s work intersecting with McConnell’s political prospects, said Painter, a vociferous opponent of the Trump administration. He added that Chao was “a lot shrewder” than Conway and a lot more “subtle.” He also acknowledged that there were ways for Chao to support her husband’s political career without violating the Hatch Act. Indeed, the couple’s supporters say she has done only that, and nothing more.

Chao has been a quietly influential Republican operative for years, showing herself a no-less-shrewd politician than the man she married in 1993. A 2014 profile in the New York Times called her an “unapologetically ambitious operator with an expansive network, a short fuse, and a seemingly inexhaustible drive to get to the top and stay there.” The same profile noted that Chao “can recite the names of people who have donated to her husband — and how much they gave.”

Chao’s interest in Paducah appears to have begun in 2006, about two years before McConnell would have had to defend his Senate seat. That September, she went to Paducah to tout the Department of Labor’s compensation payments to workers at the Paducah Gaseous Diffusion Plant, which enriched uranium during the Cold War. “It’s been a real challenge,” Chao said, noting that she “inherited a backlog of nearly 20,000 cases” of worker illness from the Department of Energy. She noted that her department had paid out $323 million to 3,000 people who had worked at the gaseous plant or to their surviving family members.

Compensating workers who handled radioactive materials for the sake of national security is laudable, but the effort also appeared to disproportionately benefit those in Paducah. A 2009 investigation by McClatchy-Tribune found that Chao’s department paid $500 million to former Paducah Gaseous Diffusion Plant employees, a full eighth of the total funds spent by the Department of Labor at that time to compensate workers who may have been affected, although the location was one of 20 major sites covered by the program. Some of those other sites —such as Hanford in Washington state and Rocky Flats in Colorado — are much bigger than the Paducah Gaseous Diffusion Plant.

A sign warns visitors to keep away from a pile of radioactive debris stored on the grounds of the uranium-enrichment Paducah Gaseous Diffusion Plant on Thursday, August 12, 1999 near Paducah, Ky.  (Photo: Billy Suratt via Getty Images)
A sign warns visitors to keep away from a pile of radioactive debris stored on the grounds of the uranium-enrichment Paducah Gaseous Diffusion Plant on Aug. 12, 1999, near Paducah, Ky. (Photo: Billy Suratt via Getty Images)

A spokesperson for the Department of Labor said that the payments to Paducah were “comparable” to those made to former workers at another gaseous diffusion plant, this one in Portsmouth, Ohio. The payments were lower than those made to workers at the only other gaseous diffusion plant in the United States, at the Oak Ridge facility in Tennessee. The spokesperson’s statement said, in part, “Awards are not made to facilities, but rather benefits are paid to current and former nuclear weapons workers whose illnesses are the result of working in the nuclear weapons industry.”

McConnell’s office, for its part, celebrated his role in “environmental cleanup and health initiatives” at the former nuclear plant, noting that those efforts had netted Paducah a total of $2 billion while creating 1,000 jobs.

In the fall of 2008, Chao’s time in the Bush administration was coming to an end, while McConnell faced a determined opponent in Bruce Lunsford, a wealthy investor from Louisville. Though he’d won four previous elections to the Senate, McConnell couldn’t seem to shake Lunsford.

That’s when Chao stepped in to help.

Chao arrived at the offices of the Paducah Sun, the town’s only newspaper, in October, less than a month before the election. There, she “laid out a compelling case for the senator’s re-election,” the Sun wrote in its Oct. 12 editorial. The editorial acknowledged that “her job” in Paducah “was campaigning for her husband.”

In campaigning for McConnell, Chao could have been in violation of the Hatch Act, according to Painter, the former White House ethics lawyer. Passed in 1939, the Hatch Act curbs federal employees’ political activity while attempting not to infringe on their First Amendment rights.

In this case, a violation would have occurred if Chao presented herself as the federal labor secretary, Painter explained. He said there is “strong” reason to make the inference that she did so, since the editorial did praise Chao for “working to keep America's workforce competitive in a rapidly evolving global economy.” At the same time, it is impossible to say whether that apparent reference was made at Chao’s explicit urging. She cannot be blamed, after all, for the newspaper’s failure to explain to its readers the division between Chao’s duties as a federal employee and her personal political interests.

A spokesperson for the department referred the matter to the Department of Transportation.

“The secretary can and does appear at events with or for her husband in her personal capacity, and had a drop-by with the Paducah Sun, as she has done in the past,” a Transportation Department spokesperson said.

Editors at the Sun did not respond to repeated requests for comment.

At the very least, the editorial was evidence of how easy it was to conflate the work of the duo. It said, for example, that McConnell “has helped secure more than $1 billion for cleanup at the Gaseous Diffusion Plant.” About half of that funding had come from his wife’s department. (The rest came from other federal sources.)

The editorial also praised McConnell for having “secured hundreds of millions in federal grants to Kentucky’s universities.” Some of those grants came from the Labor Department. In 2005, Chao’s department gave $3 million for “technical and safety mining work” in Kentucky. The next year, there was a Department of Labor grant of $2.48 million to the Kentucky Community and Technical College System “for state-of-the-art training in automotive manufacturing,” according to a transcript of Chao’s remarks to the Paducah Chamber of Commerce. In that same speech, she announced another $3 million would be devoted to educational opportunities for miners in the Pennyrile Area Development District, about 80 miles east of Paducah.

The largesse to western Kentucky’s educational sector continued. In 2007, the Department of Labor gave $130,000 to West Kentucky Community and Technical College, which is in Paducah, for “influenza pandemic training”; two years later, the department gave another $1.93 million to West Kentucky, as part of a competitive grant to which 274 institutions applied and which 68 institutions won.

From left, U.S. Rep. Ed. Whitfield, West Kentucky Workforce Investment Board Director Sheila Clark, West Kentucky Community and Technical College President Barbara Veazey, and Gov. Steve Beshear, hold an oversized check for $4,598,681 from the U.S. Department of Labor to the WKWIB on Friday at the WKCTC Emerging Technology Building in Paducah, Ky. The federal grant money will be used to assist workers and families impacted by the closing of the Paducah Gaseous Diffusion Plant. (Photo: John Paul Henry/The Paducah Sun via AP)

McConnell’s staff did not answer questions about how the educational funding had come about. But in his initial response to Yahoo News, McConnell broadly addressed his relationship with Chao, arguing that it was no different than his relationship with Cabinet members who are not his wife. “I regularly advocated for Kentuckians with members of the Cabinet and agencies of the federal government,” he said. “Kentucky continues to punch above its weight in Washington, and I am proud to be a strong voice for my constituents in the Senate.”

McConnell ultimately defeated his Democratic rival Lunsford, but not by much. “Kentucky Republican McConnell Survives Political Battle of His Career,” said a headline in U.S News & World Report. The accompanying article said that McConnell “boasted of the hundreds of millions in federal dollars he’d brought home to Kentucky” and that he “campaigned side by side with his wife, Labor Secretary Elaine Chao, whom Lunsford criticized for leaving her post” in Washington to campaign in Kentucky “as jobless numbers were rising” during the unfolding subprime mortgage crisis.

Chao would remain out of public-sector work during the eight years of President Barack Obama’s administration, while McConnell, as Senate minority leader, set out to make Obama, in his own words, “a one-term president.” Although he failed in that regard, he helped Republicans regain the Senate majority in 2014.

Two years later, he prevented Obama from filling the Supreme Court seat of Antonin Scalia, exciting conservative hopes that a Republican president would fill the seat with a right-leaning justice. Three weeks after his unlikely victory, President-elect Trump announced that Chao would serve as his transportation secretary.

When questions were raised about whether it was proper for McConnell, as the chamber’s leader, to preside over his own wife’s confirmation hearings, McConnell stood firm.

“Let me be quite clear,” he said. “I will not be recusing myself.”

As transportation secretary, Chao is once again in position to help McConnell, who will face a Democratic challenge in 2020 that is expected to be the most ferocious of his career. And once again, Paducah appears to be a focus of Chao’s efforts.

In 2017, National Maintenance and Repair of Kentucky received $377,000 from Chao’s new department to “boost Paducah’s dry dock capabilities,” according to a department briefing the following year. It was the first grant to the dry dock in a decade.

That same year, Trump moved to cut the Essential Air Service program, a subsidy for small, rural airports. Cuts to the program would have dealt a serious blow to Paducah’s own Barkley Regional Airport, which has two flights per day. Chao opposed the cuts and was ultimately successful in preventing the Essential Air Service program from being eliminated.

Although that victory would presumably have been beneficial to 159 regional airports, she made the announcement at a Washington meeting with members of the Paducah Chamber of Commerce. The following year, SkyWest announced a new Chicago-Paducah route, a development that the Paducah Sun said would “not have been possible without the help and cooperation” of Chao.

She was similarly helpful in bolstering Paducah’s maritime industry, establishing a Maritime Administration, or MARAD, “gateway” office in the town, which is on a stretch of the Ohio River busy with industry. According to a local news report, the new MARAD center in Paducah would “provide assistance to public ports by helping with congestion relief and improving freight and passenger movement.”

In her announcement of the new office during a department briefing, Chao reminded that “this is the second government office I have established in Paducah,” a reference to a Department of Labor office she had opened some 12 years before to handle compensation claims from the Gaseous Diffusion Plant.

A report in Politico noted that Paducah was an unusual site for a MARAD office because “nine other such offices are in major cities such as New York, Chicago, and Miami.” A spokesperson for the Transportation Department said the reporting distorted the matter, because the office was small and, by his estimation, provided employment to only one person.

Secretary of Transportation nominee Elaine Chao gives her husband Senate Majority Leader Mitch McConnell, R-Ky., a kiss after introducing her during her Senate Commerce, Science and Transportation Committee confirmation hearing on Wednesday, Jan. 11, 2017. (Photo: Bill Clark/CQ Roll Call via Getty Images)
At her confirmation hearing on Jan. 11, 2017, Secretary of Transportation nominee Chao gives her husband, Senate Majority Leader Mitch McConnell, a kiss after introducing her. (Photo: Bill Clark/CQ Roll Call via Getty Images)

That same month, Chao’s department gave out $4.9 million in maritime highway projects. And once again, Paducah was a winner — one of six — receiving $251,927 for the Paducah-McCracken Riverport Container-on-Barge Service.

A Department of Transportation spokesperson vigorously disputed suggestions of improper coordination. But documents obtained by American Oversight, a progressive watchdog group, through a Freedom of Information Law request, show that Andrew M. Swafford, a director of projects for McConnell’s office, repeatedly emailed Department of Transportation officials about a grant request. Other staffers in McConnell’s office made similarly insistent requests.

The emails could be seen as a determined campaign undertaken by capable staffers, of the kind that any senator can and perhaps should pursue for the sake of his or her constituents. But that’s not how Chao and McConnell’s detractors see things.

“The secretary of transportation works for the whole country, not just one state,” American Oversight’s executive director, Austin Evers, told Yahoo News, “but the documents we uncovered make it clear that Secretary Chao gave special treatment to Kentucky interests and requests from Senator McConnell's office. Given what we've seen so far, the burden is on the Department of Transportation to show that its spending in Kentucky was driven by the public interest rather than politics or personal connections.”

A spokesperson for the Transportation Department strongly disputed these suggestions of favoritism. He pointed to a Daily Beast article that described Restore Public Trust, which has been investigating the particulars of the Chao-McConnell relationship, as a “group designed to make life miserable for Trump Cabinet officials.”

McConnell’s office proudly listed the millions Paducah has received in federal infrastructure funds, in particular relating to the city’s waterways and riverfront.

“Paducah, Kentucky, is the inland waterways capital of the country, and western Kentucky is also home to major civil works projects like Olmsted Locks and Dam and Kentucky Lock. The history of Paducah is a history of life on the river,” McConnell told Yahoo News in the statement sent by his press secretary.

McConnell’s supporters say he should be commended, not criticized, for funneling federal funds to Kentucky. McConnell’s former chief of staff, Janet Mullins Grissom, tweeted the Politico article that called attention to potentially improper coordination between McConnell and Chao, dismissing the assertion that the couple had done anything wrong.

“Try as you might,” she wrote, “you’ll have to look elsewhere for scandal.”


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