Kerik's missteps may trip Giuliani


WASHINGTON - The promotional material for Rudolph W. Giuliani's consulting firm includes inspirational sayings from the Rev. Martin Luther King Jr., Winston Churchill, Gen. George S. Patton and Edward R. Murrow. The musings of only one living public figure are quoted high up there with those legends - those from Giuliani himself.

"Nothing builds confidence in a leader more than a willingness to take responsibility for what happens during his watch," Giuliani's quote reads, under the banner "Accountability." Watchwords such as these have helped sustain the heroic Giuliani image long after 9/11, bringing his firm colossal business contracts and fueling speculation that New York's former mayor could become the country's next president.

But lately that "accountability" quote may seem more ironic than iconic. The scandal surrounding Giuliani ally Bernard Kerik - the former New York City police commissioner whose nomination to lead the Department of Homeland Security imploded this month - has put the first bit of tarnish on Giuliani's post-9/11 image.

The question remains whether the Giuliani imprimatur will retain its value. Giuliani Partners, the security consulting business Giuliani opened in 2002 after leaving the mayor's office, got hot in part because Giuliani emphasized the expertise of its executives - a team that included Kerik and several other public safety officials who helped oversee the recovery efforts after the World Trade Center attacks.

The former mayor has traded heavily on his connection to Ground Zero, with clients that include insurance and risk-management company Aon; Nextel Communications, whose cellular systems are used by many first responders; and Strohl Systems, which sells business recovery software for responding to attacks.

But more recently, Giuliani has been expanding his empire. Two days before President Bush named Kerik as his pick for the top job at Homeland Security, Giuliani announced that he had bought Ernst & Young Corporate Finance to start an investment banking firm called Giuliani Capital Advisors. In a press release, he cited the experience of his team of senior executives - including Kerik - as turning the city into a "worldwide example of good government and effective management."

That sound bite doesn't go down so well with Kerik's lapses and Giuliani's reported failure to have the city conduct a background check on him before he became commissioner of the largest police force in the world. Over the past week, Kerik has been accused of using an apartment intended for exhausted 9/11 rescuers to meet two mistresses, getting entangled with a construction company under investigation for alleged Mafia ties, hiding a third marriage from his much-publicized life story and other unsavory conduct.

"What the Kerik affair did more than anything else is cast doubt on Giuliani's judgment," said Marshall Wittmann, a former Republican staffer and now a senior fellow at the Democratic Leadership Council. "He recommended an associate who clearly had a questionable past. Prior to Kerik, Rudy was the closest you could get in politics to sainthood. Now, Kerik has put in stark relief all of Rudy's political baggage."

Giuliani has survived bad PR before. Though 9/11 turned him into "America's mayor," before the attacks Giuliani was getting kicked out of Gracie Mansion because of an adulterous affair. He was known for going after edgy Brooklyn art exhibits that offended his morality or battling charges that he fired police Commissioner William Bratton because some believed the top officer overshadowed him in battling crime.

Though the one-time prosecutor took bold steps to reduce crime in the city, cleaned up the streets and developed a reputation for efficient government, critics attacked Giuliani's inner circle, accusing him of surrounding himself with loyalists ever eager to protect their own.

A reinvention

But the Sept. 11 attacks reinvented Giuliani. His leadership and his public safety team became linked with images of firefighters and police officers running into burning buildings. In the aftermath, Giuliani became a public face of the heroes.

The relationship between Giuliani and Kerik drew admiration in that disaster. But the Kerik debacle opens Giuliani's leadership style to new scrutiny. Critics say that 9/11 immunized Giuliani but that the way he ran his government was suspect.

"Anytime anyone in the city looked to blow the whistle about Giuliani, he looked to demonize them and make them a target - so there were people who were very reluctant to say anything until after Giuliani was gone," said Richard Steier - editor of The Chief Leader, a news weekly aimed at city government employees. Steier added that Giuliani foes had a motto about his administration: "The connected get protected."

Several calls to Giuliani spokeswoman Sunny Mindel were not returned last week. Giuliani has apologized to Bush for the flap that has surrounded Kerik's nomination and has tried to navigate the fallout by criticizing his friend.

"I told him, 'You made some very big mistakes here, and you would have saved yourself and a lot of others some trouble if you had dealt with this earlier,'" the former mayor told New York's Daily News. "I remain his friend, and I remain confident that he will be able to work his way through this. But he has a fair amount of explaining to do."

Such news could detract from the story of Giuliani and his fellow generals after the attacks and threaten Giuliani's political future. Time magazine's former Person of the Year - a star at this year's Republican National Convention, a leader of one of New York's top consulting firms, a Manhattan A-lister who parties with the Yankees - is forced into a position of damage control.

As far as national politics, the Kerik fiasco opens a door for conservative skeptics looking for reasons to oppose the socially liberal Giuliani.

"It's very difficult for a pro-choice, pro-gay rights Republican to win the nomination for president," said John Pitney, a political scientist at Claremont McKenna College. "Giuliani needs to keep the memory of 9/11 alive. That's his hope, and that's the reason why he got such cheers at the Republican convention. That means a lot of his past troubles are behind him, but in politics the past is never really gone."

May not damage Giuliani

But some Republicans say the Kerik affair doesn't necessarily damage Giuliani.

"The worst place you could possibly be four years out from a presidential election is to be the perceived front-runner, because that means you've got four years of everyone else trying to take you down. So, to the degree that this takes some of the pressure off Giuliani this far out, it could end up being fairly beneficial to him," said one Republican strategist who asked not to be named because he intends to work for a GOP candidate in the next presidential campaign. "I don't think the negative of it is enough to kill him."

Last week, though, conservatives were picking at the Giuliani image.

"I don't think this Kerik thing is over," said Mike Long, head of New York's Conservative Party. "Every day there seem to be new revelations. It was on the mayor's watch. It reflects on him. This was his police commissioner. Are you trying to tell me the mayor of the city of New York doesn't know what his police commissioner is doing?"

To friends of Giuliani, Kerik's image problem hurts only Kerik. Giuliani, they argue, lived his three decades in public life guided by what his company's Web site calls "Giuliani leadership principles": integrity, objectivity, loyalty, creativity and accountability.

"I just don't think that this issue that [Giuliani] is dealing with now will really have much of an impact on his future in politics," said Thomas Von Essen, a senior vice president at Giuliani Partners and the former New York City fire commissioner who helped lead the recovery efforts after the World Trade Center attacks. "It would be really shortsighted or unfair to think that the mistakes of one of his associates would have any impact at all on the good that has been accomplished over these last 30 years."

Some clients also reaffirmed their trust in Giuliani last week.

"Nothing has happened to take away the expertise and skill of Mr. Giuliani and his firm," said Jeff Trewhitt, a spokesman for the Pharmaceutical Research and Manufacturers of America. Giuliani Partners prepared a report backing the drug industry trade group's contention that importing drugs from Canada poses health and safety risks.

But public image is at the heart of Giuliani's business. Last year, the data-mining software company Cognos essentially thanked Giuliani for taking it on as a client. Cognos President and CEO Rob Ashe said the association with a firm "as well respected as the Giuliani Group" would "cement Cognos' leadership status."

For Giuliani's clients, the association was supposed to deliver access. Several Giuliani press releases - including one last year about the new partnership with Bear Stearns Merchant Banking, which planned to allocate $300 million for public safety projects - name Kerik as a top expert who will help handle the case.

"We believe the value of Giuliani Partners' access to proprietary opportunities and the expert advice they will bring to our portfolio companies will result in superior returns," John Howard, head of Bear Stearns Merchant Banking, said in a statement.

Von Essen, the Giuliani Partners executive and former city fire chief who lost 343 members of his department in the Sept. 11 attacks, says Giuliani and his firm will retain a commanding reputation despite the Kerik issue. In an interview before Kerik's nomination fell apart, Von Essen described the mission that he believes drives men like him and Kerik and Giuliani.

"We had an unusual group working with Mayor Giuliani and Bernie and myself - maybe it comes from the overwhelming losses that we had of people that we cared about so much that makes us feel like we have an obligation," he said. "You can aggressively pursue business, but what is more important than anything is to do something to make this country safe. It might sound corny, but I know we really believe that."

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