A chef prepares a meal in the White House kitchen. W.H. makes CEOs pay for lunch

Four of the most powerful business leaders in America arrived at the White House one day last month for lunch with President Barack Obama, sitting down in his private dining room just steps from the Oval Office.

But even for powerful CEOs, there’s no such thing as a free lunch: White House staffers collected credit card numbers for each executive and carefully billed them for the cost of the meal with the president.


The White House defended the unusual move as a way to avoid conflicts of interest. But the Bush administration didn’t charge presidential guests for meals, one former official said, and at least one etiquette expert found the whole thing unseemly – suggesting it was a serious breach of protocol.

“I’m sure they have their political reasons for doing that, but I think it’s not what quote, hospitality, unquote is all about,” said Letitia Baldrige, who headed Jacqueline Kennedy’s White House staff in the early 1960s. “We’ve got to relax about this. To have people to the White House and worry about the price of things is laughable.”

“I don’t know what the menu was, but I’m sure it wasn’t braised pheasant,” she said.

The White House did not say what was served for lunch or how much the attendees were charged. A spokeswoman said White House staff collected the credit card numbers separately from the event.

Around the table with Barack Obama that afternoon were Ursula Burns, CEO of Xerox Corporation; Muhtar Kent, CEO of The Coca-Cola Company; AT&T CEO Randall Stephenson; and Honeywell International CEO Dave Cote.

“From time to time, White House guests are asked to reimburse for their meals, the reasons include ensuring there is no conflict or appearance of a conflict,” said White House spokeswoman Jen Psaki. “That is consistent with our tough ethics rules and we will continue the practice when appropriate.”

The former senior Bush administration official said meals with the president were covered by official entertainment expenses that fall under the Executive Residence budget or the White House’s annual account. But the Bush administration was so sensitive about appearing cozy with corporate America that another former high-ranking official cannot recall a single instance of President Bush lunching with CEOs in the White House.

For Obama, the politics of dining with CEOs is much different: In the midst of the greatest economic collapse since the Great Depression, most Americans would likely approve of the president sitting down with the leading figures of the private sector to develop strategies to fight the recession.

Still, the decision to bill the CEOs for their meal shows the political sensitivity of relations between the commander in chief and corporate chieftains. The lunch meeting did not show up on Obama’s public schedule and was largely overlooked by the press.

The low-visibility session was part of an ongoing and concerted White House effort to maintain constant contact with the nation’s top business leaders. The corporate outreach effort, spearheaded by Obama senior adviser Valerie Jarrett, gives the president the opportunity to hear private first-hand accounts from the executives who are fighting their way through the global economic recession.

“This is something that happens on an ongoing basis,” Jarrett told POLITICO. “A lot of CEOs have now had the opportunity to sit around the table with the president.” Jarrett said some meetings include a meal, some are held in the Roosevelt room, and others are held outside the White House, at restaurants across Washington, DC. The offsite dinners include Jarrett and White House chief of staff Rahm Emanuel but are not attended by the president.

Jarrett said the dinners with Emanuel aren’t free, either: Attendees split the tab.

The sessions, Jarrett said, are held “to make sure we are creating the kind of environment where CEOs are creating jobs. It’s to make sure we have the best information to turn the economy around.”

The discussion at the June 25 lunch was open ended, with no set agenda item, and touched on health care, education and the economic recovery. Jarrett said the four companies were chosen because they are each dominant global corporations. “The president had recently returned from a trip overseas and he was eager to talk to these four huge global corporations about how they see the world economic situation.”

In a statement to POLITICO, Xerox CEO Burns offered some insight into the lunch: “The exchanges were very open and candid and touched on issues from health care reform and corporate governance to foreign tax deferral and investments in education for math and science,” Burns said. “The president was receptive – and set the tone that he was using these discussions to help inform the administration’s views on policy reform.”

Rob Ferris, a spokesman for Honeywell, offered a brief statement: “Mr. Cote was honored to participate in the lunch with President Obama at the White House and appreciated the opportunity to share his thoughts on the state of the global economy and other issues,” Ferris said. “He was grateful for the president’s engagement and interest in the dialogue.”

Said AT&T spokesperson Claudia Jones: “We certainly appreciate that the president is reaching out and engaging the business community. He’s personally involved and is listening to our viewpoints in ways that are very constructive.”

A spokesman for Coca-Cola confirmed the company’s CEO’s attendance at the meeting but declined to comment on what was discussed.

Some of the CEO outreach events have been on the White House public schedule, while others have not. They sometimes focus on specific business constituencies: The sessions have included face time, for example, with high tech companies, manufacturing companies, small businesses, hospitality executives and minority automobile dealers.

In addition to the four attendees at the June lunch, other CEOs invited to the White House or to the dinners – or both – so far this year include: Jeff Immelt of General Electric, Ken Chenault of American Express, Robert Wolf of UBS, Jim Owens of Caterpillar, Ivan Seidenberg of Verizon, Paul Otellini of Intel and Eric Schmidt of Google, says the White House.

The meetings often result in a specific follow up from the administration. At the June lunch, for example, AT&T CEO Randall Stephenson caught the president’s attention when he brought up the AT&T Foundation’s $100 million Aspire program, which focuses on preventing high school dropouts. Obama asked Secretary of Education Arne Duncan to follow up the next day to see how the government can learn from the company’s success.

“Part of what we want to do is match up best practices we find in the private sector to make sure we include those best practices here,” Jarrett said.