Last week the left-wing, anti-fossil fuel DeSmogBlog produced a story based on open records requests which was critical of North Dakota Treasurer Kelly Schmidt for hosting former CIA Director David Petraeus during a visit in North Dakota. The story alleges cronyism, stage-management of the visit by Petraeus’ current employer Kohlberg Kravis Roberts (a private equity firm), and a conflict of interest when Schmidt took a flight in a plane rented by KKR.
I wrote about the story here.
On Friday I had Treasurer Schmidt on the Jay Thomas Show, which I was guest hosting, on WDAY AM970 in Fargo. Schmidt addressed the criticism, noting that she had first invited Petraeus to North Dakota after meeting him at a conference.
“Not believing or thinking anything would come to fruition,” Schmidt said of the invitation, “a month or two later I get a phone call saying he would like to come and visit. So we worked collaboratively with KKR to set things up.”
One of the complaints in the DeSmogBlog posting was that KKR had produced a press release for Schmidt’s office to use to announce Petraeus’ visit, but Schmidt said that isn’t unusual. “When you’re working with someone who has the caliber and in some cases security issues that I may not be aware of or my staff, we always work together with the staff of someone who is coming to visit or someone of his caliber.”
DeSmogBlog also claimed that Petraeus was kept from the media during his visit. That’s a little hard to believe – Petraeus did a one hour open phones interview on KFYR during his visit and spoke with numerous other reporters – Schmidt did say that they tried to keep a lid on the visit prior to Petraeus arriving. “We didn’t want it to become something it was never intended to be,” Schmidt said. “That being said, most people are familiar with the indiscretion that the General had and its relationship to North Dakota. I was concerned that this would take on legs and it would end up being something that none of us wanted to see happen.”
In 2011 Petraeus began an extra-marital affair with Paula Broadwell, a woman who is originally from Bismarck, North Dakota. The affair is what ended Petraeus’ time as CIA Director under President Obama.
Responding to criticism of her decision to ride in KKR’s airplane, Schmidt said it was just pragmatic logistics. “I know the ethics policy of both the State Investment Board and the Land Board and I follow it very, very carefully,” Schmidt said. “And because I felt there would probably be an extra level of scrutiny relating to this event I made sure I something in writing, and also KKR requested that we have something in writing.”
State legal counsel signed off on Schmidt riding in the airplane, noting no conflict of interest.
Schmidt said there were four seats in the airplane, and she took one of them so she could return to Bismarck from western North Dakota to attend another event there with Petraeus. Schmidt said that had she not ridden in the airplane she would have had to drive a state vehicle to Bismarck, missing the event and charging the taxpayers for additional travel.
As to the supposedly nefarious meetings between state investment officials and KKR, Schmidt said it’s “not unusual.”
The state has major funds – including pension funds for state workers – invested and speaks to companies all the time about handling those investments.
You can listen to the full interview with Schmidt above.