FSM hires Capitol Hill powerhouse Arnold and Porter

By Bill Jaynes
The Kaselehlie Press
November 11, 2016
Palikir, Pohnpei—It has already been widely reported both in Washington D.C. and in some Pacific islands regional publications that the FSM has hired Capitol Hill law firm Arnold and Porter (A&P) LLC with a congressionally approved budget of $1 million of locally held funds for two years of service.
It is true that it is the most money the FSM has ever spent for a law firm to represent them on Compact and international issues. It’s also an unusual amount on Capitol Hill where $500,000 a year would be considered to be a small fee for the type of arrangement the FSM has made with A&P.
The firm submitted a Legal and Public Policy proposal to then FSM Ambassador Asterio Takesy on December 16, 2015. The proposal was not unsolicited. It offers to assist the FSM with its “legal and public policy goals in relation to the Compact of Free Association as amended in 2003, positioning the FSM for future negotiations with the US Government, and assisting the FSM in other international efforts.”

FSM Chief of Staff Leo Falcam, Jr. said that the FSM Embassy in Washington D.C. had for several years been looking at firms to help the FSM with issues surrounding the Compact of Free Association between the United States and the FSM. A long winnowing process took place over those years and “A&P sort of ‘rose to the top as cream’,” Falcam said.
And for good reason.
Established in 1946, A&P currently has nearly 700 lawyers in nine offices including Brussels, Denver, Houston, London, Los Angeles, New York, San Francisco, Silicon Valley and Washington DC. More than 75 of its attorneys have held senior positions in U.S. and European Governments and International Organizations. They provide legal services to corporations and governments around the world and their practice covers 30 distinct areas of law. A&P is outside counsel to 10 of the Fortune 25 corporations and 43 of the Fortune 100 companies.
A&P LLC has been described in US news stories as a “powerhouse firm” with strong ties in the halls of the US Government.
During one of his travels to the US, FSM’s President Peter Christian visited A&P’s corporate office in Washington DC and was impressed with the “homework” that the firm had done on the FSM and on the Compact. He invited FSM Congress Speaker Wesley Simina, who is also an attorney to visit the firm. Falcam said that Simina was equally impressed. Simina is currently off island and was not available for comment on that assessment. However, Congress did approve the million dollar budget and just a few weeks ago the FSM signed a contract with A&P.
Though they have registered as lobbyists for the FSM, “they are far more than lobbyists”, Falcam said.
Answering the question of why the FSM would hire a lobbyist when they knew a major election was coming, Falcam said that A&P’s first deliverable to the FSM is an in depth analysis of the impact of the “Trump election” on foreign policy, immigration and many other matters that the FSM will need to think about.
None of the attorneys and advisers at A&P would be affected by President Elect Trump’s stated plan for a five year-ban on White House and Congressional officials becoming lobbyists after they leave government service, or a lifetime ban on White House officials lobbying on behalf of a foreign government.
Members of the firm visited Pohnpei two weeks after FSM signed the contract. The purpose was for an orientation visit during which they visited Congress and spoke with many different agencies and departments. They are not newcomers to the region. One of their team members, Samuel M. Witten served as Counsel and Legal Adviser at the US State Department. Witten wrote President Ronald Reagan’s 1986 proclamation announcing the ratification of the Compact of Free Association between the United States and the FSM.
A bill to establish a Joint Committee on Compact Review and Planning (JCRP) was introduced to the FSM Congress in May of 2015 and became law in June of this year (PL 19-85). The JCRP has not yet been constituted. The stated purpose of the Committee is to “set goals and objectives in anticipation of the termination of the Amended Compact of Free Association.”
The Compact does not actually expire in 2023. However, the annual contributions do expire at that time. Then the FSM can access the Compact Trust fund but that fund has performed horribly.
FSM Secretary of the Department of Foreign Affairs, Lorin Robert said that if nothing changes between now and then, the Trust fund is on track for a $600 million shortfall from the amount anticipated when the Compact was amended in 2003. Clearly something needs to be done.
Falcam says that the function of the JCRP as stated in the law is to evaluate where the FSM is, where it wants to go and what resources it should utilize in order to achieve that goal. The stated purposes of the JCRP which has yet to be established do not mention the United States other than to say that the financial provisions of the Compact will expire by 2023 and the FSM needs a plan to deal with that fact.
He said that Arnold and Porter can certainly serve as a resource to JCRP but that the FSM needed to get A&P to work quickly and couldn’t wait for the eventual day when the JCRP will be constituted.
Under the Compact the US has committed to treating any attack on the COFA nations as an attack on its own soil and has agreed to respond as if it were an attack on Hawaii, California, or New York or any one of its territories. Falcam said it is the strongest military defense agreement the US has with any nation. The US still has strong strategic reasons for an exclusive military agreement with the US, reasons that might be motivation enough for the US to potentially consider the possibility of renegotiating the Compact yet a third time, but it has not said so. In fact, high US officials have said the opposite for several years.
Falcam said that the Compact allows for re-negotiation but that requires that either side notify the other through official channels that they want to do so. Neither side has done so. Three FSM Senators did introduce a measure to repeal the Compact by 2018 but other than making headlines, that measure has seen no official action of any kind in Congress since its introduction.
A&P’s proposal says:
“The FSM’s overarching objective, through support from the United States, internal development efforts, and otherwise, is to develop and achieve economic self-sufficiency. Our team at Arnold & Porter understands that to realize this overarching goal, the FSM must address various issues both domestically and internationally, including:
• Maximizing its support from the United States under the current Compact and any other sources of funding;
• Looking ahead to possible Compact negotiations when funding under the current Compact is expected to expire in 2023;
• Developing a more robust economic base and physical infrastructure with support from other countries, international organizations, and non-governmental organizations;
• Attracting foreign investment;
• Addressing energy and environmental concerns, including climate change; and
• Providing advice on improving governance at the local and national levels.
“With the ultimate goal of economic self-sufficiency in mind, we will provide the FSM with legal advice, assistance, and representation in the FSM’s relationship with the United States under the Compact and these additional areas of concern.”