Manchin, whose vote is crucial to passage of President Joe Biden’s domestic policy priorities in an evenly divided 50-50 Senate, has holdings valued at between $1 million and $5 million in Enersystems, Inc., the coal brokerage business he founded, according to his most recent financial disclosure form that covers 2020 activity.
And last year, he made more than $491,000 from his Enersystems holdings, the filings show. That’s more than twice his $174,000 annual Senate salary.
“Manchin is a walking conflict of interest,” said Craig Holman, a lobbyist for the liberal watchdog group Public Citizen. “And what makes it all the more troubling is that he’s the 50th Democratic senator, which gives him enormous sway over climate change policy.”
But the debate over Manchin’s coal interests also highlights what critics say are lax congressional ethics rules that give federal lawmakers broad leeway to regulate industries in which they have financial interests. In addition to his pivotal role on the sweeping domestic policy bill, Manchin helps set US energy policy as chairman of the Senate’s Energy and Natural Resources Committee. He has served on the panel since entering the Senate in November 2010, after he won a special election to replace the late West Virginia Sen. Robert Byrd.
Congressional rules also permit federal lawmakers to trade individual stocks — as long as they disclose the transactions and do not financially benefit from insider information.
“We have a system where a member of Congress can be invested heavily in, for example, the coal industry and then be responsible for overseeing climate policy,” said Delaney Marsco, senior legal counsel for ethics at the nonprofit Campaign Legal Center. “It doesn’t make sense.”
In a written statement, a Manchin spokesperson said the senator “is and has been in full compliance with Senate ethics and financial disclosure rules.”
“He continues to work to find a path forward on important climate legislation that maintains American leadership in energy innovation and critical energy reliability,” the statement added.
The fresh attention to Manchin’s energy interests comes as Biden and Democrats are racing this week to complete a framework for a domestic policy bill that includes many of the President’s priorities on the economy and climate. To avoid a filibuster by Senate Republicans, Democrats are relying on a budget process that requires the support of all 50 senators who caucus with them. That gives Manchin, a moderate member of the caucus, enormous sway over the negotiations.
Manchin consistently opposed the program for months, saying he didn’t support a program that would push utilities to move to clean energy faster than they were already doing. Manchin had also cited concerns that switching to clean sources of energy could mean energy would be more unreliable than continued use of fossil fuel.
The clean electricity program was Manchin’s biggest climate hang-up in the bill. But the West Virginia senator has also been pushing back on other provisions, including a methane fee that would be levied on oil and gas companies who let methane leaks escape into the atmosphere.
Manchin still is negotiating the proposed methane fee with his fellow Democratic lawmakers.
Manchin has never made any secret of his ties to coal. He’s a former governor of the country’s second-biggest coal-producing state, and he founded Enersystems before entering politics.
The organization also estimates Manchin’s net worth at anywhere from $4.3 million to $12.8 million. Lawmakers are only required to disclose their assets and liabilities in broad ranges, making it impossible to determine precise values.
Manchin’s Senate campaign also benefited from of a flood of political contributions from the energy industry in recent months. He took more than $400,000 from energy interests during the July-to-September fundraising quarter, according to a CNN review of his recent filing with the Federal Election Commission.
Donors in that period included billionaire oil tycoons Harold Hamm, the chairman of Continental Resources; Richard Kinder, the executive chairman of energy infrastructure company, Kinder Morgan; and Trevor Rees-Jones, who founded Chief Oil and Gas.
He also received donations from an array of energy-related political action committees in those months, including those affiliated with ConocoPhillips; utility companies such as Exelon and Dominion Energy; and Texas oil producer Pioneer Natural Resources.
Manchin, who isn’t up for reelection until 2024, raked in nearly $1.6 million in the third quarter — as he and another centrist Democrat, Arizona Sen. Kyrsten Simena, emerged as key players in the negotiations over their party’s sweeping domestic policy proposals.
Patchwork of ethics laws
Manchin’s energy holdings — and his actions that benefit the coal industry — are legal under rules that police potential conflicts of interest in the Senate.
The rules differ dramatically, depending on the branch of government.
Executive branch employees, for instance, are generally required to recuse themselves from decision making when their financial interests conflict with their official duties. They face potential criminal and civil charges for failing to do so. Those appointees also must abide by additional ethics rules established by the President — such as not engaging in decisions involving their former employers. Appointees in the executive branch can and do seek and receive waivers of ethics rules in limited circumstances.
It is against the law for federal judges to hear cases in which they have any legal or financial interests, but the law doesn’t impose penalties for violations.
In Congress, meanwhile, lawmakers only must recuse themselves from taking official actions in a narrow set of circumstances: If they or their immediate family members are in a small group that would benefit from the legislative action.
But a lawmaker who owns a dairy farm, for instance, can still make policy decisions that affect the entire dairy industry because those actions “also have a broad, general impact on his state or the nation,” according to the Senate’s ethics manual.
And requiring lawmakers to recuse themselves from decisions that benefit certain industries could end up hurting their constituents “who are entitled to have their elected representatives represent them by voting and fully participating in all aspects of the legislative process,” the manual adds.
Watchdog groups are urging Congress to revisit its conflict-of-interest standards.
“The rules are currently insufficient to meet the challenges, particularly if you take into consideration that the American people really view corruption as a huge problem,” said Dylan Hedtler-Gaudette of the Project on Government Oversight. His group supports the blind trust bill.
“The appearance of impropriety is just as bad as the real thing,” he added, “because that drives the way people feel about politics and government.”
CNN’s Ella Nilsen contributed to this story.