Here is a short list of corruption related stories for the week of January 4th. If you have one you'd like to see highlighted please send us one! jels[at]change-congress[dot]org.
- Michigan lawmakers have been giving away all kinds of candy to special interests in 2008. Free top-of-the-line golf clubs, golf weekends, limo rides, hotel stays, and father-son campaign donations were among some of what was uncovered in financial documents recently.
- NY State Senator Pedro Espada Jr. who represents the Bronx, faces over $61,000 in fines for breaking city campaign finance laws.
- L.A. area city councilman relinquishes his office and pleads guilty to failing to disclose cash campaign contributions and failing to file financial disclosure forms.
- New York Representative Charles Rangel again falls into the corruption conversation, this time for apparently using campaign funds to pay off parking tickets. We're beginning to wonder what campaign finance laws Rangel hasn't broken.
- The Court of Appeals has suspended newly elected NY County Surrogate Court judge Nora Anderson after a Manhattan Grand Jury charged her with falsifying business records. The suspension will stand until the charges are resolved.
- The former accountant for Massachusetts Speaker of the House Salvatore Dimasi, Richard Vitale, was charged with 10 misdemeanor counts relating to alleged secret lobbying on behalf of a state ticket broker. A federal grand jury is also investigating why Vitale and other close friends of Dimasi landed multi-million dollar state contracts. Vitale blew off his arraignment this week because he was on vacation with his family.
- The Obama team now says when pressed for information about the "pay-to-play" federal probe, Richardson failed to be forthcoming.
- A Baltimore County Council member was indicted on theft charges, in addition to a grand jury indictment for allegedly breaking campaign finance laws.
Many campaign finance crimes don't have to happen. There is a solution that that should be our first step in taking care of this "first problem." While we as a nation face many of the most important problems on earth, from global warming to the wars in Iraq, Afghanistan as well as the Middle East, we won't begin to appropriately deal with these issues until we can have some faith in our government's ability to solve them. That faith is centered on trust. When only 11% of the Americans feel that Congress is doing "a good job," the trust has been broken, the faith has been lost. Congress, the one body of our government setup to be closest to the people, is bankrupt.
It's time we took our elections back and removed the backroom deals, secret handshakes and powerful interests ruling the People's House. We can remove the special interests from the equation and add transparency, openness and trust to this broken system.
How do we stop this pay-to-play politics? The first step should be creating a system for citizen-funded elections. Our leaders should only be accountable to us, not to special interests. Checkout Lawrence Lessig's idea for how to do this here.
Current Lt. Governor of Illinois, Pat Quinn, says that Governor Blagojevich will be out of office by February 12th, which happens to be Abraham Lincoln's birthday.
Rasmussen is reporting that trust in both Republican and Democratic parties is at its lowest level since June. The recent scandal surrounding Illinois governor Blagojevich has forced voters to re-evaluate their trust of Democrats. In addition, 30% of voters in November were undecided as to which party could be more trusted, now almost 40% feel that way.
The hidden stat that I don't think many saw or gave much of a thought to was this: nearly 60% of voters said Obama should make government ethics reform a top agenda item when he assumes office in January. An overwhelming majority of the country wants to change this system. More importantly they want to trust this system again. They want to believe that the decisions being made around healthcare, global warming, our tax dollars and corporate bailouts are not being made based around the money. These are public policy decisions. Decisions that affect everyone in this country.
Securing a simple public funding program for all Congressional elections would drastically change the way this system works. It would pull corporate money out of the system, force lobbyists to trade only information (not checks , limit the impact of "bundlers" and stop politicians from using earmarks as bribes for future campaign donations.
This is a first-step in taking on this corruption. Its one we all can make. Cast your vote now and stand up for citizen-funded elections and remove the power of the special interests and lobbyists in Washington.
Naomi Klein, activist and author of No Logo, has a great series of 1 minute videos on BigThink.com. In one she addresses the corrupting influence of corporate money in politics:
"I think there needs to be a citizen’s revolt against the corporate takeover of politics... Americans are in an endless election campaign. It never ends. So the idea that after the election then there will be policy, there is no after the election. There is always another election, another fundraising campaign, and you know it never ends."
Klein also highlights the critical importance of campaign finance reform: "Before this can actually lead to political change, we need to change the rules. We need to get corporate money the hell away from politics; or at least a huge separation. It has to . . . It’s the most pressing issue of our time. It’s the most pressing issue of our time because it’s what needs to happen before anything else can happen."
We're advocating the same thing.
Money is not the only problem but it's the problem that must be fixed first. The time is ripe and with your help we will create the change that we need.
Rasmussen is reporting that 84% of Illinois voters want their Governor, Rod Blagojevich, to resign. And 79% believe he should end up in jail. And almost 40% of Illinois voters believe that his allegations of trading political favors for campaign contributions and personal favors, is the way that most politicians operate.
So, 40% of all voters in America believe that this type of corruption, this level of lowness, is how most of our political leaders operate? Perhaps, not so surprising, but it begs the question: are ALL of our politicians corrupt, or are they a part of a system that is corrupt? I believe that, outside of a few bad-apples, its the system, not the individuals. Blagojevich could be simply playing the game. As outlined in the Boston Globe this morning, many groups, including the Brennan Center for Justice at NYU, have "criticized the state's lack of campaign contribution limits and the weakness of its disclosure system." Indeed, Blago was hustling to get money in the door before a new set of ethics rules became effective on January 1. Those rules would force him to change the way he collected money and financial support. If the game you're being forced to play already thrives on corruption, how do you win the game? You become the most corrupt player. And it seems like Chicago has rewarded the best players for a long time, players like Mayer Daly (both of them). The article goes on to point out that this type of corruption isn't limited to Chicago wards:
Political corruption has many homes. Speaking to The New York Times, one Illinois political scientist likened Blagojevich's style to a "big Chicago ward, where a US Senate seat is like granting a zoning variance or liquor license." But why should even small policy decisions be made for political or personal gain? In Massachusetts, the FBI has accused a former state senator and a Boston City Council member of taking bribes in a liquor licensing case.
The news from Illinois is extraordinary. But other states shouldn't count their blessings just yet.
While Chicago-style politics has a history as being one of the most corrupt in the country, there is a general loyalty to one's own hometown in defending it as being "not as corrupt as Chicago" (or New Jersey, Tallahassee, Virginia...). When, in reality, corruption stories at the state and local level are just as dirty and scandalous as any other. The deeper you dig, the more interesting it gets.
Rep. Charlie Rangel (D-NY) is again under scrutiny as FEC records show that he "steered nearly $80,000 of campaign cash to an internet company run by his son." The cash was payment for creating and managing Rangel's re-election and PAC websites. However, some who viewed the sites say that the poor design was worth no more than $100.
Rangel, who is also undergoing a House Ethics Committee probe into his failure to pay property taxes on his NYC real estate as well as using House stationary to solicit funds for a public policy institute bearing his name, now faces further ethics concerns around whether the work his son did for the website was a payment or a payoff.
This from Meredith McGehee of the Campaign Legal Center:
“You're in a situation where you were given money for a campaign and it's being used to enrich family members,” she added. “The return argument is they're performing legitimate services. The question that needs to be asked in this case is: Was this a legitimate payment or was this a payoff?”
The Politico article compares Rangel's website expenses to other members of Congress over the last few years. He ranks numero uno with fellow big spenders Ralph Regula (R-OH) and former Congressman Chris Shays (R-CT) only spending half as much on website development.
Sunlight Foundation's Paul Blumenthal posted a screenshot of the Congressman's PAC website noting numerous errors. Not what you hope to be getting for an $80,000 fee. Ironically, the payments to Steven Rangel stopped after he became investigative counsel to the House Energy and Commerce Committee in 2007 for a reportedly $80,000-a-year.
Amidst all of the energy and fervor around the 2008 elections, one thing remained the same: money wins elections. Once again, the candidates with the most money were able to take home victory in not just the Presidential race (Obama outspent McCain two-to-one) but in Senate and Congressional races around the country. The Center for Responsible Politics released numbers last week demonstrating that no matter how much enthusiasm a candidate might have, it all comes down to money in the end.
As CRP's Executive Director Sheila Krumholz revealed, in 9 out of 10 contests the best-funded candidates won their races. This matches a trend that is familiar to those tracking the connection between money and politics:
Continuing a trend seen election cycle after election cycle, the biggest spender was victorious in 397 of 426 decided House races and 30 of 32 settled Senate races. On Election Day 2006, top spenders won 94 percent of House races and 73 percent of Senate races. In 2004, 98 percent of House seats went to the biggest spender, as did 88 percent of Senate seats.
Despite Congressional approval ratings dangling in the single digits, 95% of House incumbents won re-election and 93% of Senate incumbents were welcomed back by voters. How did they do it? Money.
These financial shackles that require massive amounts of money just to mount a viable candidacy for the House or Senate are dangerous in two ways:
(1) it keeps out regular Americans from ever being able to run for office because they can't raise enough money to stay competitive.
(2) it in debts winning candidates to their benefactors. As Krumholz says, "The politicians who were just elected potentially owe their campaign contributors billions of dollars for helping them win." How they repay them is part of the problem.
Here are some figures to chew on:
- average cost of winning a House seat in 2008: $1.1 million
- average cost of winning a Senate seat in 2008: $6.5 million.
- 1 in 4: number of House seats where incumbent faced no financial opposition.
- CRP's estimated total cost of U.S. elections this year: $5.3 billion making it the most expensive election in American history.
- 93%: House races where top-spender won.
- 94%: Senate races where top-spender won.
My first reaction to this was, "What could we fund with $5.3 billion?" Healthcare? A more efficient and stringent regulatory system? Education? But then I realized, Johnson & Johnson spent $5.1 billion on selling the world soaps, shampoos and toothpastes in just the third quarter of 2008. McDonald's spent more than $689 million selling the world hamburgers and french fries in 2006. And Proctor and Gamble spent over $7.9 billion selling the world laundry detergent, Pampers, batteries and Pringles. After seeing those numbers, am I really that upset that we spend $5 billion "selling" tomorrow's democracy to the people? I don't know.
Do you feel we spend too much on electing our leaders or not enough?
My interest has been peaked of late. What is the fate of publicly funded campaigns given the "Obama phenomenon?" A recent NPR article Did Obama Kill Public Campaign Finance? asks the question, "Is something rotten in the state of public financing for presidential campaigns?"
The article continues:
Sen. John McCain, one of the most vocal proponents of campaign finance reform, is being hoisted by his own petard by choosing to accept federal funding for his general election campaign. Meanwhile, Sen. Barack Obama, the choice of the Democratic Party — the very party that cried out for finance reform in the wake of the Watergate scandal — has chosen to bypass public funds and, as a result, is pummeling McCain in the fundraising arena.
Irony alert: The Republican standard-bearer is using federal grants, while the Democrat extols the free-market virtues of individual campaign donations.
One could argue that Obama's campaign is 'publicly funded,' after all, he and the DNC have forgone Lobby and PAC money and the majority of his campaign contributions come from small donations made by lots of people. However, the "Obama phenomenon" does not take into account an average person seeking office. This is where public funding would level the playing field so that ordinary citizens could run for office. Obama's 'star quality' and fund raising ability, plus the current political climate, cloud the argument for killing public funding.
McCain opted in to public funds, thus agreeing to cap out at $84 million for his campaign. The RNC supplements his allocated funds by raising money and they do take Lobby and PAC money. Neither candidate, in my opinion, represents 'clean money.'
No matter which candidate wins the White House, both will be faced with determining the fate of public campaign financing, in fact, both have an obligation. At Change Congress, we would also argue that the issue needs to go beyond Presidential and on to Congressional elections -- a more difficult battle.
A smart conversation took place on KQED's Forum with Scott Shafer. I encourage you all to have listen and weigh in on the conversation through our comments section. Sheila Krumholz, executive director of the Center for Responsive Politics is on the panel and directs people to the OpenSecrets site so you can follow the money yourself. You can listen in below:
The largest association in the state of Texas, the Texas Association of Business, pleaded guilty today to a misdemeanor charge, unlawful direct campaign expenditure, and paid $10K in fines to the state. After a six-year investigation into the campaign practices of the TAB's political action committee, this is the last lawsuit they'll have to deal with (unless 2008 turns out to be a especially corrupt election year.)
Apparently, the association's PAC was paying for the salaries of its President Bill Hammond and chief lobbyist Jack Campbell as they traveled around the state convincing voters to support state GOP candidates, attending fundraisers and speaking to the media on behalf of the candidates and their campaigns.
Earlier in 2007 District Judge Mike Lynch dismissed two indictments of TAB after the association spent over $1.7M on mailers and television ads on behalf of state GOP candidates. But now, with Texas redistricting on the table for the 2008 and 2010 state legislatures, the temptation to flood swing districts with political ads is hard to ignore. This latest decision by the district court will (hopefully) keep some of the corporate PAC money out of the airwaves and off voters' front stoops. Let's be honest, however, in today's stock market, paying $10K for pumping over $1.7M into local political races is a steal. Now, these business leaders have a host of state legislators in their back pocket. At least, that is how the public will perceive it. The return on investment is better than owning stock in Google (at least a couple months ago anyway). TAB obviously understood this after they moved their headquarters to the state capitol in 1990.
A closer look at the Texas Association of Business shows, once again, a revolving door between elected officials and lobbyists. Hammond, now President, was formerly a four-term member of the Texas House of Representatives. While there, he authored the Texas Education Agency Sunset Bill that was criticized heavily for opening up failing public schools to control by private entities (corporations, universities, non-profits could all essentially manage a public school under the bill). Two years later, after Hammond had left public office, his old boss, the Speaker of the Texas House, named him to lead the Commission on Higher Education and Global Competitiveness.
This, all while aggressively advocating for specific TAB-endorsed candidates around the state of Texas.
In a rather pathetic show of guilt, TAB lawyer Joe Turner complained that the laws around campaign finance law are just too confusing:
Association attorney Joe Turner called upon the Legislature to clarify "this treacherous area of the law," which he said can be confusing for people like Hammond who must wear multiple hats: salaried employee, representative of a political action committee and citizen.
"This is an accounting nightmare," Turner said.
Ok, i understand that the law might be confusing. But I don't tell the state that the reason I didn't pay any taxes for nine years was because, "Gosh, tax law is just really confusing." It is, but you find someone to guide you through it.
Here's another idea: how about individuals like Hammond and Campbell don't wear four different hats, all of which have severe legal implications if ever worn at the same time. The fact that they knew they had to wear different hats shows they understood the vague, but existent, legal divisions created between each one.
I highly doubt TAB understood that it was breaking the law. Perhaps they thought they were bending it. And ignorance is rarely a ticket out of guilt, which is why TAB agreed to pay the $10K fine and move on. Regardless, they are under the reform microscope for the next few cycles.
As you probably know, the Federal Elections Commission requires political committees to disclose information about all donors who contribute over $200, including their name, address, occupation, and employer. (There are some great sites, like OpenSecrets.org and FundRace.org, that help make sense of this data.) But this is just a minimum -- campaigns can do more. John McCain has been disclosing his sub-$200 donors and he recently criticized Barack Obama for not dong the same.
By looking at the disclosed records, the RNC and other Obama critics have found donations that Obama isn't legally permitted to accept -- contributions from overseas, contributions over the legal limit, contributions under apparently-fictitious names. Presumably, McCain thinks that if Obama opens up the rest of the data, they'll find even more. Obama has received contributions from literally millions of people, so it's a lot of data to look thru.
To put the pressure on, the RNC has released RNCDonors.com, which provides a near-real time search interface to all sub-$200 contributions to the RNC. (Why only sub-$200?) Very little data is disclosed about each contribution, but it's still fun to type in the names of Republican friends and see if they donated. So far Obama and the DNC haven't responded to these tactics.
The good people at CCMC have been working to ensure the passage of AB 583, the California Clean Money and Fair Elections Act (Hancock, D-East Bay.) They had some good news on Friday when the bill was voted out of the State Senate Appropriations Committee on a 9-6 vote. Here are excerpts from a recent Press Release. Congratulations!
AB 583 would establish a voluntary full public financing system for Secretary of State candidates modeled after the systems that have been working in Arizona and Maine for eight years. AB 583 has now been amended to be funded by voluntary contributions designated on state tax returns and by a registration fee of $350 a year on lobbyists, lobbying firms, and lobbyist employers, the same as in Illinois. Currently lobbyists only pay $25 every two years in California, one of the lowest rates in the country.
Connecticut’s legislature passed a Clean Money bill in 2006 that is so popular that 215 out of 225 candidates have indicated they will use it. Arizona and Maine started public-financing state elections 8 years ago. North Carolina, New Mexico, and New Jersey all have Clean Money pilot programs.
Speaking after the Committee vote, Assemblymember Hancock said, “It has been a long and hard road, but I am deeply pleased that AB 583 is now moving to the Senate Floor. This reform is a critical step to helping restore the voters’ confidence in government and I trust that the rest of my colleagues in the Senate will recognize its necessity.”
“Secretary of State candidates, like all other candidates, have to spend huge amounts of time raising money for their campaigns from private contributors,” said Julie Rajan, Executive Director of the California Clean Money Campaign, the sponsor of the bill. “Californians would have more faith in their government if candidates could instead spend more time reaching out to voters and discussing issues that matter to them.”
AB 583 is supported by a wide range of organizations, from good government groups like the League of Women Voters of California, California Common Cause, and CALPIRG to groups representing diverse Californian interests such as Sierra Club California, the Consumer Federation of California, the Equal Justice Society, the California Nurses Association, and Gray Panthers California. Over 80 regular voters from as far as Orange County drove to Sacramento testify at the hearing on Monday.
Saturday was a busy one at Netroots Nation in Austin. After a high-energy morning starting with the anticipated Ask The Speaker event, followed by a surprise visit from Al Gore, Lawrence Lessig took the stage to dynamically discuss the ways in which money erodes trust. He gave examples from pharmaceutical issues to copyright law to environmental policy, showing how money is distorting the decisions our leaders are making. Check out the video:
For the last week we've received some interesting emails and comments from our members about Change Congress's stance on Obama's decision to opt out of public financing. Our basic response is one echoed by some' pundits and those working in the reform movement over the last two decades. It's a tough situation for any candidate to be in. The current public finance system is a mess and desperately needs to be overhauled.
Public financing is only one piece of the overall campaign reform puzzle, yet, a vital one. The recent dancing around public funding by McCain and Obama is a situation that no candidate should have to be in -- choosing between a broken system that could cost them the election while gaining positive press or being called a "flip flopper" for opting out of that same broken system.
The current public financing system fails to address major loopholes abused by both parties over the past twenty years. Until this needed reform happens, we're foolish to think that any candidates able to raise more on their own would ever opt-in to a broken system that could end up costing them a victory down the line.
The Big Loophole - the explosion of 527 groups over the past ten years has given rise to the nastiest negative campaigning we have seen in our time. On both sides of the aisle 527 groups have made it their raison d'etre to challenge and accuse candidates not in line with their political ideals, launching powerful, well-funded attacks that can single-handedly change the outcome of an election. While many of these groups do not (and indeed by law cannot) work with or coordinate with a campaign, they are often ideologically aligned with one candidate and are often staffed with members of the same political party
The Big Flaw - the $84 million that public financing offers is not enough to run a presidential campaign in this economy. The problem is not that there is too much money in politics, rather that there is too much of the wrong kind of money in politics -- money from lobbyists and PAC organizations, people who expect favors later on. If we want a public financing system to be legitimate we have to honestly address the shortfalls that this sum of money leaves in its wake; the cost of national advertising on television, radio and internet being a major one. Or the cost of employing a national grassroots staff working in every state in the country. The public financing offer from the government should be realistic compared with the costs of a presidential campaign. If we want candidates to buy into the system, make them a decent offer. They aren't going to accept a used Chevy Malibu when they can buy a new Ferrari with their own money.
Pundits on the right say Obama is a hypocrite, given his pledge to accept public funding earlier in the campaign and then recently deciding not to. Both candidates could be called as such. McCain gladly accepted public financing during the Republican primaries when he was losing and broke, and then petitioned the Federal Election Commission to opt back out when he was winning and wealthy (and now he's opting back IN). Neither are wrong, they are simply doing the expected political shifting based on our broken system.
I can't wait for the day when a well-crafted, mutually agreed-upon, public financing system is finally ready to be implemented. But that day will come only after enough of us stand up to change that system by making it possible for politicians who fight for issues like public financing to win office and take this change to Washington. Change Congress is about working with you and other organizations dedicated to reforming this system from the inside out. The current system isn't working for the people, so it must be changed by the people from the bottom up. You can help, be a part of our movement, help us re-build this broken system. Join us! Its only our government if we work to reclaim it.
Big news coming from the DNC this evening as Barack Obama, the Democrat's presumed nominee for 2008, made it crystal clear how seriously his party will take addressing corruption inside the beltway.
"We will not take a dime from Washington lobbyists or special interest PACs," he said. "They will not fund our campaign, they will not run our party, they will not drown out the voices of the American people."
Not only has Obama's campaign taken this pledge but now so has the Democratic Party.
This is good news and a big step forward for Change Congress' goals. Having one of this country's two leading parties refuse donations from PACs and registered lobbyists is a defining moment. This is where we should be heading to keep this government free from special interest control and corruption. Whether or not Democratic candidates will follow the lead of the DNC is yet to be seen and is the real test behind this proclamation, where the rubber meets the road.
However, there is still work to be done. We hope that John McCain and the Republican National Committee will respond in similar fashion, but as of yet there is no official word.
We've got a few candidates (four in total) running in Illinois and this little tidbit of news caught my eye today.
After years of languishing in the Illinois legislature, a campaign finance law that would limit pay-to-play politics is moving rapidly. The Senate could vote this week on House Bill 824. Its key provision bans people or businesses that do $50,000 or more in business with the state from donating to the campaign of the official who controls the contract. In other words, it's designed to stop the kind of influence peddling that allegedly has occurred in Gov. Rod Blagojeivich's administration.
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These are baby steps. We need giant leaps forward. Even Governor Blagojevich has hinted at vetoing the bill, saying it doesn't go far enough in instituting real reform. This is ironic coming from the elected official who's "pay-to-play" allegations are what triggered the bill initially. Whether its a stalling tactic to "protect a practice at the core of [his] unprecedented fundraising success," is debatable.
Hopefully, this will lead to more action on campaign finance reform within Illinois and will trickle up. If it doesn't, this type of legislation won't keep people from finding loopholes in the near future. Illinois has to build off of this, as we all do.
Democrat Darcy Burner is causing a ruckus out in Washington state. She has raised over $516K in the first quarter this year, dramatically out pacing the Republican incumbent Dave Reichert for what looks to be a fourth consecutive quarter. Here's the kicker: more than 88% of her donations are from individuals, not from PACs or political parties. She has over 8,800 donors who have only given an average of $156, which means the room for growth within her existing donor pool is (probably) much deeper than Reichert's.
This is exactly the type of change that Change Congress is talking about. Its already happening. People are standing behind, supporting and giving money to candidates who recognize that Washington is broken and needs to be fixed. Darcy is proof of the tidal wave of change that is sweeping this country be it at the national level or at the district level. Those of you in the Washington 8th let us know how things are going.
