James Baker III, President Bush's special envoy on Iraq, has coaxed France and Germany into forgiving part of Baghdad's $120 billion debt. Do Baker and other special envoys get paid for their diplomatic efforts?
No, for the most part, though the malleability of the "special envoy" title allows for the occasional sweetheart deal. According to the White House, Baker's post is both unpaid and temporary—he cannot legally hold it for more than 130 days in a calendar year, per the Code of Federal Regulation's guidelines on "special government employees." Other high-profile diplomats who've worked under similar non-remunerative arrangements include the Rev. Jesse Jackson, who was named "special envoy to promote democracy in Africa" in 1997, and current Defense Secretary Donald Rumsfeld, who infamously shook Saddam Hussein's hand while serving as Ronald Reagan's special envoy to Iraq in 1983. Special envoys are essentially quasi-ambassadors, empowered to conduct negotiations that other diplomats may not have the time, expertise, or clout to push forward. The envoy tradition dates back to the earliest years of the American republic; James Monroe, for example, served as special envoy to France in 1803 where he helped negotiate the Louisiana Purchase at President Thomas Jefferson's behest.
Though he technically remains a private citizen, Baker is still expected to comply with government ethics rules that preclude him from using his special envoy status to further his business objectives. Richard Holbrooke, for example, got in hot water during his mid-1990s tenure as special envoy to the Balkans for improperly contacting U.S. embassy officials to further a Korean banking project. (He eventually paid a $5,000 civil fine to settle the matter, prior to becoming the American ambassador to the United Nations.) To avoid the appearance of impropriety, Baker has resigned from the board of the consulting firm EDS, and his law firm, Baker Botts, OK'd the appointment after a "thorough review" of potential conflicts of interest. Baker also remains senior counselor of the secretive Carlyle Group, a powerful investment firm that counts former President Bush as an adviser.
Not every special envoy has to work entirely without perks. When Thomas "Mack" McLarty resigned as President Clinton's chief of staff, the president begged him to stay on in some capacity. The two eventually settled on the title of "special envoy to Latin America," a post that hadn't been filled since the 1960s. A multimillionaire car-sales tycoon, McLarty declined any salary for himself but did hammer out an agreement to use those savings to increase his staff from three people to nine people.
In November of last year, Otto J. Reich was named special envoy to the Western hemisphere, a State Department post created especially for him—and one that didn't exactly jibe with the traditional spirit of the "special envoy" title. The appointment came after Reich failed to gain Senate confirmation for the job of assistant secretary of state, thanks to Democrats who raised a stink over his role in the Iran-Contra affair. (Fortunately for Reich, special envoys do not require the Senate's OK.) Unlike Baker, Jackson, and others, however, Reich was paid a salary by the State Department during his brief tenure, before landing job as "special envoy for Western Hemisphere initiatives" in January. The new post is under the aegis of the National Security Council, rather than the State Department, but it's also a paid position.