How D.C. lobbyist Daniel Vajdich tried to stop Putin’s pipeline
In December 2019, a 1,200-foot-long, 400-foot-wide ship called Pioneering Spirit muscled through the waters of the Baltic Sea off the Danish island of Bornholm.
The floating behemoth — the biggest construction vessel in the world, according to its owner — is frighteningly fast at doing what it's designed to do: string together huge tubes in deep waters so that fuel can flow from one place to another. The fight over this one ship's journey was costing millions of dollars in Washington lobbying clout. It was a moving part in a global political battle that would ultimately entwine with a devastating war in Europe.
Hour by roiling hour, Pioneering Spirit was speeding toward setting in place some of the final stretches of a 750-mile pipeline, known as Nord Stream 2, that would add a massive new direct connection between Russia's state-controlled gas empire and the lucrative German market, as well as the rest of Western Europe.
Four thousand miles away, in Washington, a tiny lobbying shop called Yorktown Solutions, raced against Pioneering Spirit. The firm's founder, Daniel Vajdich, could be thought of as Ukraine's man in Washington — a lobbyist and overall fixer.
At 37, he emits the polished gloss of a man on the rise in a capital dominated by much-older power brokers: not one strand of his thick, sweptback hair is out of place or gray. He has the fitted suits, the Patek Philippe watch. His arguments, ever at the ready, also come in bespoke tailored dimensions: bite-size for a short-attention-span public and encyclopedic for the congressional staffers who drill down on the fine print.
As the big ship got closer to its goal, Vajdich's clients — an association of energy-related firms led by the state-owned Ukrainian energy company — were getting more worried. Nord Stream 2 was going to allow Russia to bypass the pipelines in Ukraine that it was paying tens of millions of dollars to use. That would deal a savage blow to the former Soviet republic's economy.
But the Ukrainians also worried that rendering their country irrelevant as a gas transit path would leave them in a weakened state, more vulnerable to a Russian invasion. On top of that, they fretted it would make Europeans cozier with — and more beholden to — the autocratic Russian leader Vladimir Putin.
Kyiv wanted its man in Washington to kill Nord Stream 2.
To do that, his four-person firm was going to have to persuade Congress and the Trump administration to come crashing down on Nord Stream 2, which would run alongside the other Russian pipeline bottle-feeding Europe with affordable gas — Nord Stream 1.
Talking about the intricacies of pipelines cries out for the development of a guiding philosophy, or a pitch, if one prefers, to answer a key question that gets asked in the halls of the U.S. Congress a lot: Why should we care?
Vajdich crafted a response, and repeated it over and over. As he sees it, stopping the new pipeline would be in the national security interest of the United States and thwart the Russian president from weaponizing energy on a continent filled with U.S. allies.
"Energy is not about energy," Vajdich said in an interview, as Russia's invasion of Ukraine stretched on. "It's about security. That's why we talked about consequences."
For years, though, the pipeline project's Russian backers have had friends in Washington, too. Some of the best-known lobbyists in town have worked on behalf of Nord Stream 2 AG, a company that is based in Switzerland but owned by the Putin-controlled Russian energy company Gazprom. These marquee names have gravitas, connections and juice: Vin Roberti, a former Connecticut legislator turned mega-lobbyist, and Walker Roberts, a former deputy staff director on the U.S. House International Relations Committee who is now perched at the lobbying powerhouse BGR Group.
Five non-Russian companies involved in financing Nord Stream 2 had considerable capital cachet, hiring lobbyists from the firm co-founded by President Bill Clinton's White House chief of staff, Mack McLarty. Germany, an important U.S. ally, was also exerting heavy pressure to block any moves against the pipeline.
For a long time, said Vadym Glamazdin, the former government relations envoy to the United States of Ukraine's energy company, it has been "like David vs. Goliath." It's Vajdich against the big players.
The kids in Saratoga, an upscale Northern California enclave, were not like the kid with the funny name.
Vajdich, the son of a tech engineer turned entrepreneur, wasn't just different because the spelling of his name made its pronunciation a bit of a riddle — it's VY-ditch and derives from his ancestral roots in Slovenia, Croatia, Serbia, Hungry and Austria. (Given his work for Ukraine, many assume he's Ukrainian, which is fine by him. "Some are Ukrainian by birth and others by choice," he said, using a phrase popular with Ukrainian diplomats.)
Growing up in a land of privileged liberal politics, Vajdich was an outlier because he tilted hard to the right even from childhood. Looking back, he thinks he became even more politically conservative in reaction to the blue landscape.
Since moving east, Vajdich has checked lots of the boxes that can help guide the most industrious Young Future Stars of Washington into places of influence.
Impressive degree, Capitol Hill staffer, national political campaign? He checked them all, including working on the short-lived presidential campaign of Wisconsin's former Republican governor, Scott Walker, and advising the 2016 presidential campaign of Sen. Ted Cruz, the Texas Republican who's a Russia-sanctions hawk. After graduate school, he did a stint at the Carnegie Center in Moscow. In those days, he thought there was a chance of good U.S.-Russia relations. He's now convinced that Russia will be an adversary for decades to come.
When he started his firm in late 2015, Vajdich said, he wouldn't hire former members of Congress or ambassadors, and eventually instituted a ban on campaign contributions by his team — a departure from a Washington ritual in which lobbyists spending several nights a week double- and triple-booked to hand out checks at political fundraisers.
"When I started this, it was just a theory," Vajdich says of his self-imposed bans. The theory became a selling point.
For Vajdich, taking on the Ukrainians as a client in 2017 meant taking on a client with an image that reeked from the excesses of its kleptocratic elite. A former president suspected of plundering government coffers, Viktor Yanukovych, had fled in 2014, leaving behind a gaudy estate that featured a zoo and a private lake with its own galleon.
The endemic corruption — both at the upper echelons of government and in the state-owned energy company, Naftogaz — did not inspire confidence in Europe that the gas flowing from Russia to Ukraine could be counted upon. New leaders in the government and at Naftogaz helped, but the stigma remained. Vajdich says he needed to persuade often-skeptical American policymakers that the Ukrainians could be "reliable partners."
Vajdich and the staffs of sympathetic members of Congress agreed on a plan. It was called an "airdrop," borrowing a military term, and involved parachuting Nord Stream 2 sanctions into a national defense bill. The outside-the-box move would require an almost impossible to imagine bipartisan melding of Democratic and Republican congressional leaders. They called it PEESA, which stands for the Protecting Europe's Energy Security Act.
The proposal focused on a big target: the giant ship, Pioneering Spirit, and others like it.
The idea was given little chance of passing.
Vajdich, who can be witty, charming and self-deprecating when the mood is right, also doesn't shy from confrontation. He adopted what he called a "scorched earth" approach.
"Your boss is protecting Putin's pipeline," Vajdich recalled telling one chief of staff whose office was, unknowingly, creating an impediment with a proposal that had nothing to do with Nord Stream 2. "She's going to be the one to blame if Putin gets this project." The chief of staff did not like being talked to that way, Vajdich said.
The argument that it was in U.S. interests to block Putin's pipeline took hold. Vajdich sensed the resistance beginning to fall away, and Congress came around. In December 2019, President Donald Trump, who had called Germans "captives to Russia," approved sanctions that specifically targeted deep-water pipe-laying ships. The Germans were furious. The following day, AllSeas, Pioneering Spirit's Swiss-based owner, announced it had stopped laying pipe.
The next time Glamazdin, the Ukrainian government-relations envoy, came to Washington, Vajdich took him to a downtown Washington restaurant to celebrate. Glamazdin had the bartender make a drink he’d invented: 1 ounce of dark rum, half an ounce of crème de cassis, a dash of bitters and an ounce of ruby port. Stirred — not shaken.
He called it "Black Poison."
Vajdich and the Ukrainians were on a winning streak. At the beginning of 2021, they got the sanctions expanded to include Nord Stream 2 financing and supply companies.
Still, there were some highly respected voices in Washington urging restraint. An Atlantic Council column co-authored by Daniel Fried, the former U.S. ambassador to Poland, argued that Nord Stream 2 should not be killed. Fried and his co-authors wrote that the United States should instead consider a variety of options that would repair damage to U.S.-German relations left over from the Trump administration.
Around the same time, Vajdich was picking up signals that concerned him. He got a call from a contact on Capitol Hill who said, "You’re never going to believe this." The source was giving him a heads-up that the Biden administration was moving toward waiving sanctions against Nord Stream 2 AG, the company overseeing the pipeline, and its German chief executive, Matthias Warnig, a former East German intelligence officer. In May, President Biden waived the sanctions. This required some Washington spin. Biden's national security adviser, Jake Sullivan, went on CNN and, pressed by the anchor, Dana Bash, did more than spin — he took a pinwheeling leap that might have brought a figure-skating audience to its feet. The sanctions waivers did not apply to Russians, Sullivan said: "It was a German individual and a Swiss company."
That was almost too easy for the CNN fact-checker who called the statement "misleading" after the broadcast, noting that even though Nord Stream 2 is registered in Switzerland, it is owned by the Russians. (The nonpartisan Congressional Research Service has also stated that Nord Stream 2 is a "Russian-owned" company.) Sullivan did not respond to interview requests for this report.
On Capitol Hill, Republicans and Democrats criticized the decision, which was publicly announced by Secretary of State Antony Blinken, who stated that it would help repair U.S. relations with Europe. One Republican senator called it a "gift to Putin." In damage control mode, the administration argued that the completion of the pipeline was inevitable because Russia was now using its own ship to finish the pipeline.
Vajdich was flabbergasted. He "takes it personally," said his wife, Brittany Vajdich. (Vajdich likes to call his wife his "second-grade sweetheart," because they met in elementary school.) At home in Northwest Washington, she heard her husband yelling a lot during phone calls.
That summer, as the threat of a Russian invasion loomed more ominously, the Germans, who had pushed so hard for completion of Nord Stream 2, issued a joint statement with the United States saying they would deploy sanctions and "other tools" against the pipeline if Russia "weaponized" energy or committed acts of aggression against Ukraine.
Vajdich fumed. He felt Russia was already weaponizing energy because its promises of cheap gas through the new pipeline had brought the Germans squarely into the pro-Nord Stream 2 camp.
Within a few months, the pipeline was complete. Putin was massing troops at the border of Ukraine. The Biden administration was trying to persuade the public that the completion of the pipeline might actually play a role in preventing war.
The pipeline "is leverage for the West, because if Vladimir Putin wants to see gas flow through that pipeline, he may not want to take the risk of invading Ukraine," Sullivan told reporters in December.
Just as Glamazdin and Vajdich had been predicting, Putin invaded Ukraine in February.
With the invasion in full swing, Biden began imposing a raft of sanctions against Putin, the Russian financial system, oligarchs and many other entities. Nord Stream 2's high-powered lobbyists began to peel off, ending their contracts. "We terminated our engagement on the Nord Stream 2 gas pipeline project this past February in compliance with U.S. sanctions," said a spokesman for Roberti — who had been paid $10.2 million by Nord Stream 2 AG since 2017.
Vajdich received $2.5 million from 2017 to 2021 from Ukrainian energy producers, according to his foreign agent registration filing — about a fourth of Roberti's haul alone — and has a $960,000 contract for 2022.
Richard Burt, a former U.S. ambassador to Germany who heads a wholly owned subsidiary of the McLarty firm, and another lobbyist at the company have received $3.53 million from five Nord Stream 2 financing companies since 2017, according to data compiled by OpenSecrets. Burt declined to be interviewed for this story; Roberts, the BGR Group lobbyist who has received $3.76 million from Nord Stream 2, according to records compiled by OpenSecrets, did not respond to interview requests.
What's left for Vajdich to navigate is a surreal world. The Germans, who are U.S. allies in supporting Ukraine as it battles Russian forces, continue to pay the Russians for gas. That's because the other big pipeline, Nord Stream 1, continues delivering gas from Russia to Germany. (Germany's ambassador to the United States recently told CNN that the country intends to stop accepting Russian gas as soon as possible. The Russians, just as Vajdich and his clients feared, began squeezing Germany and the rest of Europe in late June by substantially reducing gas shipments via Nord Stream 1.)
Even stranger, Russia has paid Ukraine under its contract to transit gas through the country it is invading — even when it's not using the Ukrainian pipelines. In effect, Russia is helping fund the country against which it is waging war.
In this odd and often misunderstood, geopolitical landscape, Vajdich sees more U.S. congressional fights ahead. He suspects European supporters of Nord Stream 2, particularly in Germany, will take another run at putting the pipeline into service. It currently is just lying there without ever having been used. And he's recently embarked on a new battle with the same adversaries, this time representing Ukrainian titanium industries in their fight against corporate interests who want to block sanctions against Russian titanium interests.
For now, Vajdich is stuck watching a war laying waste to Ukraine — and yelling into the phone at home, where everyone gets an earful.
The other day, his wife was taking their 4-year-old, Dashiell, to school. The little boy turned to her, she says, and asked: "When are we going to Ukraine? Maybe I can roar at the bad guys. That could help, right?"