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Dark money trail reveals significant influence in Colorado elections

Open Secrets - Thu, 07/27/2017 - 06:35

The dome of the Colorado Statehouse is framed between trees. (AP Photo/David Zalubowski)

It’s no surprise money can play an important role in winning elections, but where that money comes from is often difficult to ascertain.

One example of this “dark money” influence can be found in the results of the Colorado state House of Representatives election last year. All 65 district spots were up for grabs and in the end the Democrats remained in the majority, securing three additional seats.

Eighteen Democratic candidates in the Colorado elections received monetary support from Common Sense Values, an independent expenditure committee that can raise and spend unlimited amounts of money in elections. Of the candidates who were favored by this IE committee, nearly three-fourths of them won their respective elections.

The Democratic candidates who received the most support were Rep. Jeff Bridges (more than $202,000); Rep. Thomas “Tony” Exum, Sr. (nearly $190,000); and Rep. Barbara Hall McLachlan (almost $160,000). They represent Colorado’s third, 17th and 59th districts, respectively.

According to the Colorado state campaign finance disclosure website, the Common Sense Values IE committee was started in August 2016 and then terminated the following December after the election was over. In just a few short months, it raised nearly $2.6 million and spent the vast majority of that supporting or opposing candidates in the Colorado House elections, with the remainder going toward “consultant and professional services,” among other items.

So how did the Common Sense Values IE committee raise more than $2.5 million in five months? Almost all of the money — $2,558,968.03 to be exact — came from its partner organization with the same name: Common Sense Values. But since the other group is a 527 “issue advocacy” organization it needed an IE committee to be able to advocate for or against political candidates. The two groups also used each other to pass funds back and forth.

Although both the 527 organization and the IE committee were primarily state-focused during the 2016 election cycle, the IE committee did engage in limited federal activity. As a result, the IE committee did report some electioneering communications to the FEC.

Brendan Fischer, director of federal and FEC reform for the Campaign Legal Center, said it looks like the Common Sense Values 527 organization set up the IE committee as an entity it could route its electioneering communications through. He added that although the Common Sense Values IE committee may sound like a super PAC, it did not appear to register with the FEC as such.

Similar to its IE committee, the Common Sense Values 527 organization also terminated shortly after the 2016 election, although it was originally started in November 2014.

Both the 527 organization and the IE committee had the same two registered agents: Ashley Stevens and Julie Wells. According to the Colorado registered agent search, Stevens is tied to a total of 18 different independent expenditure committees and 527 committees. Of these committees, only five remain active with Stevens as the registered agent. Wells has her name associated with more than 60 committees — all of them terminated, except one of which she is no longer the active agent.

The same email and phone number are listed for both Stevens and Wells on federal and state documents for their committees. Neither Stevens nor Wells responded to requests for comment on their work as registered agents for the two Common Sense Values groups.

Continuing down the money trail, it is not as clear-cut where the Common Sense Values 527 organization received its funds during the 2016 election cycle. Almost 180 different groups contributed to the organization, giving it a fundraising total of more than $3.1 million. The top five donors were Education Reform Now Advocacy ($455,000); the National Education Association (NEA) Advocacy Fund ($255,000); the Democratic Legislative Campaign Committee ($200,000); the Service Employees International Union ($150,000); and America Votes ($138,750).

Two of these top contributors — Education Reform Now Advocacy and America Votes — are nonprofit 501(c) social welfare organizations, which means they do not have to disclose their donors to the public. These groups are not supposed to have politics as their primary purpose, but quite often spend heavily in elections at both the state and federal level. And because they do not have to disclose their donors, the money trail often dead ends here. There is very little way of knowing the identities of these donors, who — at least partially — supported the campaigns of several Democratic candidates running for seats in the Colorado House of Representatives.

The identities of the original donors — whether they be individuals or corporations — are almost impossible to uncover. However, research conducted by the Center for Responsive Politics has added some clarity as to where organizations like America Votes receive their money. For example, a CRP analysis of tax filings from 2014, show that two of America Votes’ largest donors were the League of Conservation Voters and Patriot Majority USA, a non-disclosing group run by Democratic operatives that has spent millions in federal elections.

Data from the Department of Labor also indicates unions heavily supported America Votes. In 2016, the nonprofit organization received almost $2.6 million from 13 different unions.

The 990 form for America Votes for the 2015-16 fiscal year was the first piece to this dark money puzzle. The tax document showed America Votes gave grants to four different Colorado-based organizations, including Common Sense Values (the 527 organization). The $138,750 Common Sense Values reported it received from America Votes was through one of these grants. America Votes’ super PAC also gave Common Sense Values an additional $46,250.

While America Votes is a national organization, it does have state-based affiliates across the country. Although Colorado is one of America Votes’ “core states,” it is still noteworthy that the national organization decided to devote so much attention to this one state, rather than any of their other 20 state affiliates. Following the money trail ultimately revealed the elections in Colorado as the likely reason committees based in the state were receiving extra attention from America Votes.

In the 2015-16 fiscal year, America Votes spent more than $8.4 million. As a 501 (c)(4) organization, America Votes is not supposed to dedicate more than 49 percent of its expenditures to political spending. Sometimes these groups can get around this requirement by reporting certain spending as “educational.” The grants given to the four Colorado-based organizations were all marked as “general support” and also reported as political spending in the Schedule C of America First’s 990. In all, America Votes gave $333,750 in grants for the 2015-16 fiscal year, bringing its political expenditure total to $1,308,352 — well under the 49 percent limit for political spending.

Put simply, the money funding these Colorado elections came from secret sources and changed hands many times before actually reaching the candidates. Nevertheless, the support seemed to help as 13 out of the 18 candidates who received money won their respective elections and now hold seats in Colorado’s House of Representatives. As for the true origins of this dark money, unless regulations around 501(c) groups change, we may never solve the donor mystery.

The post Dark money trail reveals significant influence in Colorado elections appeared first on OpenSecrets Blog.

Categories: Further Reading

Internet of Things

Lloyd G Carter Blog - Tue, 07/25/2017 - 11:15

 

The IoT and Energy Conservation

By Emma Bailey

From ancient Roman aqueducts delivering fresh water to advanced clean energy generation easing the burden of fossil fuels, technology has long been used to address the great problems facing humanity. The Internet of Things (IoT) may well represent the next evolution of this trend, leveraging the power of modern computing and connectivity to tackle some of our most difficult and pressing problems. In particular, the IoT has already demonstrated great usefulness in energy conservation and environmental protection efforts. To learn more, let's dig into how this fledgling technology may play a key role in reducing waste and promoting a more sustainable future.

Assembling an Internet of Things  READ MORE »

Categories: Further Reading

How wealthy donors fund the national party by giving to the states

Open Secrets - Mon, 07/24/2017 - 15:38

On September 30, 2016, Barry and Trudy Silverstein each gave $416,100 to the Hillary Victory Fund, a joint fundraising committee. The Victory Fund was a federal committee — so contribution limits supposedly apply — raising money for the Democratic National Committee, the Clinton campaign, and 38 state Democratic party committees. Each donor could write one check that included the maximum contribution to each of the participants: $5,400 directly to the Clinton campaign — $2,700 each for the primary and the general — $33,400 to the DNC and $10,000 to each of the state parties for a total of $418,800. (The Silversteins had already given to Clinton during the primary, which is why they gave less than the maximum.)

Clearly the Silversteins felt very strongly about supporting Hillary Clinton, and they weren’t alone. At least 40 individuals made single contributions of $400,000 or more, and 125 people made a donation of at least $300,000 to Hillary Victory. It may be a surprise, though, that some of this support trickled down to Democratic party committees in states where Clinton was never expected to be competitive. That included Kentucky, Oklahoma, South Dakota, Wyoming and West Virginia – states in which President Trump received more than 60 percent of the popular vote.

Why would the largest donors be willing to invest in states that were generally thought to be hopeless? The answer lies in the fact that party committees are permitted to make unlimited transfers of funds among themselves. That means that a state party committee in, say, Wyoming is free to transfer unlimited sums to the DNC, so long as the original source of the funds complied with federal contribution limits.

The vast majority of the money these donors gave to state parties through Hillary Victory was never intended to be spent in the states. Rather, much of it spent very little time in the state party accounts before being transferred back to the DNC. Of the $112.4 million that Hillary Victory transferred to state parties, $88.3 million–or 78.5 percent–was sent back to the DNC.

This sleight of hand to provide bigger donations to the national party has been used by Democratic presidential nominees since at least the Kerry campaign in 2004. 2016, however, was the first presidential election since the Supreme Court decision in McCutcheon v. FEC, which declared unconstitutional the two-year cycle limit on total contributions from a single individual. Prior to that ruling, an individual could not contribute more than a set amount to all candidates, parties and PACs combined. In 2014, that limit was set at $123,200 (which was never actually enforced because McCutcheon was handed down in April of that year). Because of additional sub-limits, it would not have been possible to give the maximum contribution to the DNC and more than four state parties during the cycle.

So while some money could flow from a single individual through state parties back to the DNC in past cycles, these amounts were generally relatively small and roughly in line with the limits on giving directly to the national committee. After McCutcheon, however, the ability of an individual to circumvent the contribution limit to a national party committee was limited only by the ingenuity of fundraisers and lawyers and the willingness of other groups — in this case, state parties — to participate by giving the proceeds back to the national party.

What was the impact of the McCutcheon decision on the DNC in 2016? The details get a little complicated here because the money is moving through several accounts and committees filing separate FEC reports, and some are better at reporting than others. The Hillary Victory Fund reports how much it received from each individual donor and how much it transferred to each recipient, including the 38 state parties. We can also see how much each state party reported receiving from Hillary Victory — though it doesn’t always match what Hillary Victory says they transferred — and which specific individual donations were the source of those transfers. Then we can see how much the DNC reported receiving in lump sums from each of the state parties.

Some states transferred every dollar back to the DNC, but many kept some portion of the Victory funds, ranging from very little to as much as one third. This means we can’t say with precision how much of each individual donor’s contributions to state committees ended up in the DNC account, but we can make a back of the envelope estimate.

If the overall cycle contribution limit had not been struck down by the Supreme Court, it would have been about $126,000 in 2016. We know that 430 individuals gave more than that total directly to Hillary Victory, combining for a total of $126.7 million. This means that $72.5 million went to the joint fundraising committee in excess of the old limits. That’s about 14% of the total receipts of the Hillary Victory Fund. (Actually, this assumes that all of these folks would have given the full cycle limit to this committee and therefore been unable to give to other federal candidates or PACs, so this is a conservative estimate. It’s likely that the “loss” to the Victory fund would have been much larger.)

The impact on the DNC, though, was even greater. We know that all of these big donors gave the maximum contribution ($33,400) directly to the DNC through the joint committee. We also know that about 78 percent of the money given to state parties ended up back in the DNC coffers. We can use a little more arithmetic here to estimate how much each donor was therefore able to give to the DNC in excess of the $33,400 limit by passing the money through states.

If we look at every donor who gave Hillary Victory more than they could have given directly to the Clinton campaign and the DNC — meaning that the excess went to state committees — and take 78 percent of that excess amount (the fraction that went back to the DNC), we find that the DNC received $82.7 million over the direct contribution limits by way of this (completely legal) circumvention. That comes to 24 percent of the total receipts of the DNC during 2015-2016.

There is nothing inherently partisan about this approach, of course. These tactics are available to both parties, and the Trump campaign joined with the RNC and twenty-one state Republican committees in 2016. The number of very large donors was much smaller in this case, however. Only 122 individuals gave more than $126,000 directly to Trump Victory and they gave only $20 million more than would have been permissible before McCutcheon. While nearly all of the $29.7 million transferred to states went back to the RNC, this represents only about 9% or the RNC revenue total for the 2016 cycle.

Changes to the campaign finance system in the last several years have focused the attention of the media, academic researchers and political operatives on the free-for-all nature of outside groups raising and spending unlimited sums. Many have concluded that one consequence of this change has been the decline of parties in the electoral process. Since parties must comply with old contribution limits and prohibitions, it is assumed that outside groups with no such barriers have become more important, and that their influence contributes to polarization.

There are, however, reasons to wonder if the actual effects are as dramatic as they seem. The Campaign Finance Institute has shown that some of the most important outside groups are really creations of party leaders in Congress and former party officials who saw an opportunity to “spin off” new organizations with the same goals and approaches. The actual separation between these groups and the party organizations and leaders who formed them may not be very large. In addition, we have seen that the parties were able to take advantage of other rules changes to accept big donations to their own accounts. (We’re not even looking at the three “special” accounts that Congress created for the national parties to use for headquarters, legal expenses and presidential conventions which together brought an additional $40 million to the DNC in 2016.)

So, parties have become important players in the big dollar fundraising system as it has evolved in the last few years.

Even in the regulated world, a few hundred donors now account for far more of the DNC’s resources than the millions of small donors who gave less than $200 each in 2016.

So what happened to the Silversteins’ money? We know from FEC reports that $356,100 each from Barry and Trudy went to the Clinton campaign, the DNC, and thirty-two state parties. This is actually $60,000 less than they gave to Hillary Victory, and we know that at least five other state committees received transfers from Hillary Victory that were not fully documented in their FEC filings. We also know that all but three of those thirty-two state committees gave all of their Victory funds to the DNC around the time that the Silversteins donated. Thus, we can be pretty confident that the Silversteins were able to legally circumvent contribution limits that still exist, at least on paper. As a result, the gap between regulated parties and unregulated outside groups is, for better or worse, far smaller than some would have us believe.

The post How wealthy donors fund the national party by giving to the states appeared first on OpenSecrets Blog.

Categories: Further Reading

Lobbying in high gear with prospect of regulatory reform in Congress

Open Secrets - Mon, 07/24/2017 - 12:33

Sen. Rob Portman, R-Ohio, listens during a roundtable discussion in Cincinnati. (AP Photo/John Minchillo)

As part of President Trump’s promise to dismantle the regulatory state, his administration has cancelled or delayed Obama-era protections for workers and the environment. It has installed agency heads unlikely to pursue strict enforcement of existing rules. And it has allowed political appointees to oversee the rollback of rules affecting their previous employers.

Now industry groups see another opening: procedural reform in Congress that would complicate and likely hinder the rulemaking process. Two such bills have generated a flurry of lobbying activity this year.

The Regulatory Accountability Act (RAA) is the sixth-most lobbied bill in the current Congress, with at least 109 clients: 23 from agribusiness, 10 from the energy sector, 9 from construction, and 7 from transportation, among others. The extent of lobbying activity is likely greater, as lobbyists’ disclosure forms often avoid disclosing specific legislation.

Ronald Levin, a law professor at Washington University in St. Louis, described the bill as containing many provisions—some desirable, some innocuous, and some very troubling. “It’s the troubling ones that are really driving it,” he added, with political muscle coming from the Chamber of Commerce and various industries. “They want these measures that would complicate the rulemaking process.”

The RAA passed the House during the Obama administration but died in the Senate. In January, Senators Rob Portman (R-Ohio) and Heidi Heitkamp (D-N.D.) introduced a modified version of the House bill. Few doubt that President Trump would sign it if given the chance.

Under current law, independent regulatory agencies (think the Federal Reserve or the Consumer Financial Protection Bureau) and those under White House control follow different rulemaking requirements. The latter group must submit a cost-benefit analysis to a White House agency known as the Office of Information and Regulatory Affairs, or OIRA, before any major rule can take effect. That review process acts as a check on poorly planned regulation. But some liberals have called OIRA the place where “regulations go to die” for the slow pace at which it makes determinations. Independent agencies can issue rules without first getting White House approval.

The RAA would change that. Independent regulatory agencies would have to submit a cost-benefit analysis and seek approval from OIRA before issuing significant rules.

The independent agencies value their autonomy. When the RAA was percolating in Congress in 2012, heads of six independent agencies sent a letter to senators arguing that the power of executive review would give the president “unprecedented authority” to influence their rulemaking ability. Opponents of the RAA contend that Congress made these agencies independent precisely to avoid any interference or influence from the White House.

Last week, the Senate confirmed Neomi Rao to lead OIRA. As a law professor at George Mason University, she made the case that independent agency heads should be subject to removal by the president. She also founded a center on regulatory affairs at the university that benefitted from a $10 million donation by the Charles Koch Foundation last year. Americans for Prosperity, the Koch-backed advocacy group, has lobbied for the RAA.

The RAA would also mandate trial-like hearings for economically significant rules. Agency experts would have to sit for cross-examination in what would likely be drawn-out and adversarial proceedings. The outcome would be fewer rules in areas with uncertainty, as there often is with regulation. “The concern is that uncertainty would be pounced upon at these hearings and add time and expense and delay,” said Cary Coglianese, director of the University of Pennsylvania’s Program on Regulation.

Industry representatives have long argued that many federal rules lack proper evaluation and are too stringent. The Chamber of Commerce has said that more transparency and accountability are needed in the rulemaking process. But Lisa Gilbert of Public Citizen, a liberal group that has lobbied against the RAA, called it “paralysis by analysis.” She added that its introduction as a bipartisan bill and its support from some moderate Democrats, like Senators Heitkamp and Joe Manchin (D-W.Va.), might win it enough votes to pass.

Even more worrisome to consumer and environmental advocates is the REINS Act. Introduced by Senator Rand Paul (R-Ky.), it’s the fifteenth-most lobbied bill with at least 71 clients. REINS would subject every new regulation with an expected impact over $100 million to congressional approval. Experts predict that this would inject partisan politics into the bureaucratic process.

Coglianese suggested that REINS would impact administrators’ approach to regulation in more subtle ways as well. Already administrators weigh the possibility of judicial review when formulating rules so that they hold up in court. REINS would force administrators to not only evaluate fidelity to any given statute, but to also consider how rules will play in Congress.

That would put politics front and center in ways that could be “undesirable and even irresponsible,” he added.

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Categories: Further Reading

Dark money and potential foreign influence

Open Secrets - Wed, 07/19/2017 - 06:34
Testimony by Sheila Krumholz, Executive Director of the Center for Responsive Politics before the Senate Democratic Policy And Communications Committee
July 19, 2017

 

Chairwoman Stabenow, Senator Whitehouse and other Senators:

Thank you for this opportunity to submit testimony for today’s hearing regarding politically active nondisclosing nonprofits (“dark money organizations”) and the possibility of foreign funding of those activities.

The Center for Responsive Politics has been “following the money” and its effects on U.S. politics and policy for 34 years. I, myself, have been doing this work at the Center for most of those years, and I can attest to the fact that the work of unveiling the sources of money spent to shape U.S. elections has now become extremely challenging. As always, it comes down to transparency. When our laws have required transparency in campaign finance – for example, requiring disclosure of soft money to the parties in 1991 – the press, the public and groups like ours have been able to effectively investigate and track money in U.S. politics. During the late 1990s, having disclosure of this information was critical to congressional investigations, which concluded that foreigners had indeed contributed to U.S. political committees, in violation of the law. Today, the laws governing transparency of money in politics have not kept pace with other changes to our campaign finance system. In particular, the Citizens United decision threw the door wide open to unlimited contributions from unlimited and secret sources giving to supposedly independent outside groups interested in shaping electoral outcomes. We already know from past campaign finance scandals that foreign corporations, individuals and governments had the wherewithal and the willingness to try to shape U.S. elections in the past. Given this, it defies logic to think that those motivations or opportunities no longer exist – particularly since foreign donations can be given easily, legally and secretly to nonprofits that are now allowed to be highly politically active.

 

Particularly given apparent foreign interference in last year’s elections, and the wideranging and serious ramifications of such interference, Congress must act, and act quickly, to defend our democracy.

For our part, CRP’s researchers have spent countless hours delving into 990 tax forms filed by nonprofits over the past decade, trying to disentangle networks of dark money organizations, and to the degree possible, tease out the identity of their hidden funders. CRP investigators work to analyze the meager information provided in public IRS forms along with other public information about the financial activities of politically active organizations reported to the Federal Election Commission and other government entities.

It is painstaking work, given the massive number of nonprofits in the U.S., so we partner with GuideStar to make sifting through the data more efficient. Unfortunately, by necessity, it is also largely forensic work, given that tax forms are filed anywhere from five to 10 and a half months after an organization’s fiscal year ends, and in some cases the filings aren’t submitted until we come looking.(1) What this means, depending on an individual group’s fiscal year, is that even if an organization is filing on time, it can be revealing financial information about its election activities that is already almost two years old. (2)

We also use, and offer on our OpenSecrets.org website, FCC records on political ad buys to examine data on broadcast ads by nonprofits, whether that spending is reported to the FEC or not. In contrast, information about spending on highly targeted political messaging on social media platforms such as Facebook remains largely secret, limiting what we can know about funders of the online political messaging that was reputed to be so highly influential in the 2016 elections. (3)

In report after report, CRP Political Nonprofits Investigator Robert Maguire and our team of researchers and reporters have documented the byzantine process and exorbitant fees demanded by politically active nonprofits claiming tax-exempt status to obtain their application materials and tax forms, and the virtual stakeouts we have had to arrange in order to do so.(4) On top of that, we’ve spent thousands of dollars and countless hours monitoring IRS documents for these groups, trying to piece together what activities they are actually engaged in when their tax forms lead to dead ends. The IRS, in contrast, may take months or years to approve an organization’s status, yet never ask the group any questions at all.(5)

If “this” is due diligence, it is neither efficient nor effective, and the IRS should be called upon to use all of the information available to it – including reports filed with the FEC – to corroborate information reported to it by nonprofits seeking tax-exempt status. The IRS should also be required to provide free, electronic information to the public on groups seeking tax breaks. Until then, if due diligence requires no stone unturned, one sometimes has to be willing to fork over $428 for a Form 1024 application(6), only to see that it contains a print out of every single page of a group’s website, along with their lease, as was the case with the 501(c)(4) nonprofit, American Bridge 21st Century, one of a number of nonprofits about which we have written that have posed challenges to gathering what is supposed to be public information on their tax-exempt financial activity.

From this work we have identified patterns that ought to be concerning to policymakers who believe that the public should be an active participant in their democracy, and that they need and deserve effective and meaningful disclosure of money in politics in order to be able to do so. We have found:

  • Politically active nonprofits that report to the IRS political spending that contradicts their FEC reports covering the same period;
  •  Entities that raise and spend tens of millions of dollars but have no employees, no volunteers, nor even a bricks-and-mortar presence, but exist only as a UPS box – raising the specter of money laundering organizations whose sole function is to act as intermediaries, obscuring money’s source and pathways;
  • Purported “social welfare” and “business league” nonprofits whose financial activity spikes in election years and then plummets in non-election years to far lower levels reflecting their pre-Citizens United activity – a pattern more typical of political campaign committees than organizations devoted to social uplift.

Why does this matter? Because if it’s difficult for an organization like the Center for Responsive Politics to follow the money, it will be unlikely that American voters will fare any better. And the identity of the messenger behind political advertising is clearly fundamental to understanding the credibility of their message.

Does knowing whether an ad on indoor clean-air rules is funded by a tobacco company change the way we absorb the message? Or whether a pro-gun rights ad is paid for by a gun manufacturer? Of course it does. Voters quite logically evaluate campaign communications differently when they have information about who is promoting the message, which is why political operatives and donors seek anonymity – to take away the ability of people to think critically about and possibly discount their message.

Unfamiliar and innocuous-sounding names used by politically active nondisclosing nonprofits may actually lead voters to find their claims to be more credible than those from organizations with which they are already familiar.(7) Studies suggest that when voters are exposed to ads from unfamiliar groups they “lean in” to listen more carefully, giving their messages more attention and value than they would if they knew who was behind the message. When voters are being bombarded with political messages but cannot accurately judge their credibility because essential information is being withheld from them, they are far more likely to make judgements based on incomplete, misleading or false information and therefore are prevented from making decisions in their own best interest. When such a situation is allowed to exist, the integrity of our democracy is in danger.

But voters are not the only ones being short changed by this system of readily available loopholes for disclosure. Other government regulators, such as those at the FEC, do not have access to important financial information in real time that would help them to investigate groups in a timely manner.(8)

At a time when there are daily headlines about foreign interference in the 2016 elections, concerns about foreign governments tampering with state-based election systems, and fake news emanating from foreign countries that microtarget American social media users, it is no longer sufficient to rely on historical norms or societal pressure to deter misbehavior in political finance.

There is evident need to better monitor foreign involvement in U.S. politics, including oversight of the paid campaigns by foreign governments to influence U.S. policies. The Foreign Agents Registration Act’s weak disclosure rules allowed Trump advisers Mike Flynn and Paul Manafort to lobby on behalf of foreign governments without disclosing that they had done so until months after the fact. One tool that can facilitate this oversight is Foreign Lobby Watch, a free, user-friendly database that CRP launched on OpenSecrets.org earlier this year, allowing people to more easily delve into these reports and to know who is selling their services to foreign governments and corporations who seek to shape U.S. policies.

President Reagan said, “Trust, but verify.” Given foreign meddling in U.S. elections, lax enforcement, the rise of megadonors and secret channels through which to fund politics, it is urgent for public officials to provide the American people with a comprehensive and trustworthy means by which to verify who is bankrolling politically active nonprofits and how they shape our elections and policies.

Justice Kennedy, in writing to uphold disclosure laws as an important basis upon which Citizens United was decided, wrote, “…transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.”

Unfortunately, the Court’s decision was based on incomplete information. We do not have and are not guaranteed a transparent campaign finance system. We must clearly communicate this fact and rectify it, because allowing the current façade of transparency to continue will only worsen cynicism and distrust and is deeply damaging to our common goal of protecting the integrity of our democracy.

Thank you.

____________________________________________________________________________

Citations

  1. For example, when we requested returns from the Government Integrity Fund seven months after the group should have filed them, we were told that the group would file them the following week (but they took more than a month to file): https://www.opensecrets.org/news/2016/06/group-that-backed-tom-cotton-in-14-got-a-bigboost-from-club-for-growth/
  2.  For example, if a politically active nonprofit runs on a July to June fiscal year, it can spend heavily on political ads in July. Then, once it’s fiscal year ends, the following June, it has 10 and a half months to file its 990, which in most case means the group will wait until May of subsequent year (i.e. 22 months after the spending took place) to file.
  3. For example, one of the largest most politically active nonprofits in the last cycle was One Nation, run by the same political operatives that run Crossroads GPS. In October 2016, Citizens for Responsibility and Ethics in Washington noted that One Nation had been posting ads on its Youtube page that did not correspond with filings that would have had to have been submitted to the FEC if they were run on television, suggesting that they were using a web-ad loophole: https://www.citizensforethics.org/big-spending-non-profit-one-nation-exploiting-onlinead-loophole/
  4. CRP’s 2015 report detailing what we had to go through to get tax documents for Rosebush Corp—a pass-through nonprofit that funded super PACs and other politically active nonprofits—details the unnecessary complexity: https://www.opensecrets.org/news/2015/01/14-months-of-runaround-more-on-how-to-obtain-or-not-publicdocuments-from-the-irs/
  5. And in some cases, when they do ask questions, they seem willing to accept almost any response. For example, a politically active nonprofit called the American Future Fund, which pursues no demonstrable social welfare beyond political activity and funding other groups that do, applied for recognition as tax exempt in 2012. Upon being asked by the IRS about reports of its possible involvement in a campaign money laundering scheme in California and millions of dollars-worth of direct candidate advocacy in federal elections, American Future Fund not only affirmed that the information the IRS was presenting was accurate but also that it did not “anticipate that its future activities will differ substantially from those it has carried on to date.” Still, the IRS approved the group’s application: https://www.opensecrets.org/news/2014/04/nonprofits-exemption-was-granted-despite-record-finebig-political-spending/
  6. “This 2,143-Page IRS Document Could Be Yours for Just $428.60 (Plus Shipping)” https://www.opensecrets.org/news/2014/07/this-2143-page-irs-document-could-be-yours-for-just-428-60-plusshipping/
  7. “Why We Should Care About Dark Money Ads.” http://mediaproject.wesleyan.edu/blog/why-we-should-careabout-dark-money-ads/
  8. The case of Carolina Rising is perhaps one of the best examples of this. Not only did the group spend virtually all of its money running positive ads about a single Senate candidate, Thom Tillis, who won his election, but the head of the nonprofit was on live TV from the Tillis victory party saying “$4.7 million. We did it.” However, the FEC deadlocked on whether to proceed with an investigation of the group partly because of the fact that the Office of General Council did not have access to Carolina Rising’s tax return, which hadn’t been filed yet, and therefore, the OGC could not have known that the group’s overall spending was barely more than what they had spent supporting Tillis: https://www.opensecrets.org/news/2016/11/fec-deadlocks-wont-investigate-dark-money-groupthat-spent-all-its-funds-on-an-election/

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Categories: Further Reading

Dan Bacher to appear on my radio show

Lloyd G Carter Blog - Tue, 07/11/2017 - 19:38

Attention Website Visitors:

 

 Sacramento Environmental Reporter Dan Bacher will appear on my radio show "Down in the Valley" this Thursday (July 13) at 1 p.m. on KFCF, 88.1 FM radio. Radio range is limited to about 100 miles from Fresno but internet users worldwide can listen to the show live streaming at www.kfcf.org.

 

      Lloyd

Categories: Further Reading

Amid antitrust talk, Amazon and Google flex lobbying muscle

Open Secrets - Fri, 07/07/2017 - 09:05

Amazon CEO Jeff Bezos at a product launch in June 2014. (AP Photo/Ted S. Warren, File)

In May, at a conference for investors in New York, venture capitalist Chamath Palihapitiya raised eyebrows by calling Amazon a “multi-trillion dollar monopoly hiding in plain sight.” Amazon’s current market cap is $461 billion; getting to a market cap of $3 trillion, as Palihapitiya suggested it would, will require a nearly seven-fold increase in value. Just as noteworthy was his assertion that Amazon would get there through market control. That gets to why investors are so bullish and what’s at stake for the company as it navigates antitrust concerns in Washington.

Amazon’s strategy is to keep prices low, woo customers, and win market share in retail: grow now and profit later. (Already Amazon accounts for 43 percent of online retail in the U.S.) That explains why Amazon makes very little profit relative to its market cap. Investors pile in, accepting low returns in the short term in anticipation of a future windfall. It’s a phenomenon seen across digital platforms: Network effects, combined with the value of the data platforms collect from customers, easily make for winner-take-all markets.

In calling Amazon a monopoly in plain sight, Palihapitiya was banking on the assumption that antitrust enforcers won’t catch on and disrupt that growth. But some antitrust scholars think it’s time to intervene. “Investors and markets are predicting a reality about Amazon’s dominance that our laws are really not registering right now,” said Lina Khan, author of “Amazon’s Antitrust Paradox” and a fellow at New America. She has suggested that by competing with sellers on its platform, Amazon wields extraordinary power as a gatekeeper and has an incentive to discriminate. She has urged antitrust enforcers to step up enforcement and consider Amazon’s market power.

No one could say regulators across the Atlantic are lagging. Last week, the E.U. hit Google with a record $2.7 billion fine for favoring its own shopping service over those of competitors. The European Commission traced Google’s dominant position to network effects and data. “The more consumers use a search engine,” read the Commission’s announcement of the fine, “the more attractive it becomes to advertisers. The profits generated can then be used to attract even more consumers. Similarly, the data a search engine gathers about consumers can in turn be used to improve results.” Google has 90 days to stop favoring its own shopping service or face further penalties.

It’s unlikely that digital platforms like Google or Amazon will face real scrutiny in the U.S. under the current regulatory framework, where consumer welfare (as measured by price) has been the standard used to assess anticompetitive behavior since the Reagan administration. Tech companies are taking no chances, however. The top three digital platform companies by market cap—Alphabet (Google’s parent company), Facebook and Amazon—spend the most on lobbying among internet firms.

Even before the European Commission announced its fine, Google lobbyists were soliciting signatures from U.S. lawmakers for a letter criticizing E.U. antitrust regulation. The E.U. has a history of unfairly targeting American tech firms and stifling innovation, the letter alleges.

Google has 25 lobbying firms on retainer and spends the most lobbying Congress among internet companies. So far this year it has spent $3.5 million. Last year its lobbying outlays totaled $15.4 million. Google lobbies on a range of issues, including consumer privacy, cybersecurity, taxes, immigration, and transportation. Antitrust concerns are also high on the list. In 2012, it spent $18.2 million—a record for the company. That year, staffers at the Federal Trade Commission recommended filing a lawsuit against the company for anticompetitive behavior. The Obama administration demurred, and Google made tweaks to its search function instead.

Critics accused the Obama administration of getting too cozy with Google. The Campaign for Accountability, a government watchdog group, examined White House visitor logs and found that between January 2009 and October 2015, employees of Google met with White House officials 363 times. It also tallied revolving door activity: By its count, 22 former White House officials moved into jobs at Google, while 31 Google executives took government jobs. Early signs from the Trump administration suggest a similar coziness. Joshua Wright, a law professor at George Mason University, led transition efforts at the FTC, which has three open commissioner slots. Wright received Google funding for at least four academic papers that all supported the company’s contention that its behavior in search was not anticompetitive.

With 12 firms on retainer, Amazon has spent just under $3 million lobbying Congress so far this year. Its lobbying history mirrors its rapid growth: Three years ago it spent $4.9 million, which rose to $11.4 million in 2016. Amazon has two former senators and two former representatives on its lobbying payroll.

Will Amazon face greater scrutiny under the Trump administration? It’s hard to envision regulators blocking Amazon’s purchase of Whole Foods. Amazon currently controls 0.2 percent of the U.S. grocery market, while Whole Foods claims 1.2 percent. But President Trump has publicly sparred with Amazon founder Jeff Bezos, who also owns The Washington Post. In an appearance on Fox News last year, Trump attacked the Post’s coverage of his campaign and suggested that Amazon has a “huge antitrust problem” by “controlling so much of what they are doing.”

Tech firms have long painted antitrust action by European regulators as protectionist and anti-innovation. They would like President Trump to take that attitude, too. They’re hoping that his pro-business and “America First” agenda will ultimately matter most. In the meantime, they’re lobbying.

The post Amid antitrust talk, Amazon and Google flex lobbying muscle appeared first on OpenSecrets Blog.

Categories: Further Reading

Healthcare lobbyists are no strangers on the Hill

Open Secrets - Fri, 07/07/2017 - 06:36

UNITED STATES – JUNE 26: The U.S. Capitol is seen in a reflection on the side of an ambulance in Washington on Monday, June 26, 2017, as the Senate grapples with health care legislation. (Photo By Bill Clark/CQ Roll Call) (CQ Roll Call via AP Images)

267 former aides who worked for four congressional committees pivotal in approving new healthcare legislation are registered lobbyists for clients from the health sector or health insurance industry, according to the Center for Responsive Politics’ analysis of Senate lobbying data.

(See all the data here)

In addition, 18 former lawmakers also swung through the revolving door and now serve health care clients as lobbyists, partners or counsel at well-known firms such as Arent Fox LLP, Alston & Bird or Greenberg Traurig LLP.

113 of the total 285 lobbyists specifically lobbied on the American Health Care Act, the health care bill passed by the House.  Our lobbying data only goes through March 31st, so it is likely that all of these numbers will increase on July 21st when we collect lobbying information for the period from April 1st through June 30th. Unfortunately, very few clients discuss their position on legislation when disclosing their lobbying activities, so we cannot say which position these lobbyists were taking.

Some lobbyists and lobbying clients disclose their positions voluntarily. One such lobbyist, Mary Tirrell, was formerly an aide to Sen. Pat Toomey (R-Penn.) and now lobbies on health care issues as vice president of government and legislative affairs for Lehigh Valley Hospital and Health Network. Tirrell’s most recent lobbying report from the first quarter of 2017 shows she advocated for repealing the Affordable Care Act and replacing it with the House of Representatives’ American Health Care Act. Her past lobbying reports show a history of involvement with various health care issues. Previously, Tirrell served as director of community and economic development for Rick Santorum when he was a senator for Pennsylvania.

Another revolver also worked for one of the Senate’s “swing votes.” Amanda Makki was a legislative aide to Sen. Lisa Murkowski (R-Alaska) for almost eight years, and eventually became her top healthcare adviser. Before that she was a health policy adviser to Rep. Jeff Fortenberry (R-Neb.). In 2014, she left her work in Congress to become a lobbyist. Now, she is director of external affairs and FDA for Novo Nordisk, a global diabetes care company. Her most recent lobbying report from the first quarter of 2017 shows her involvement in issues such as prescription drug use and diabetes prevention. She also lobbied on the House of Representatives’ American Health Care Act.

Some organizations have taken public positions on the AHCA and the Senate’s still-under debate Better Healthcare Reconciliation Act. The American Medical Association, which represents doctors, opposes both the House and Senate healthcare packages. Three of its lobbyists have insider connections.  Sage Eastman and Lauren Aronson both used to work for the House Ways and Means Committee and now lobby for Mehlman, Castagnetti et al. Andrew Wankum, one of the AMA’s staff lobbyists, worked for Rep. Kevin Brady (R-Texas) prior to lobbying.  

The largest trade association for the insurance industry, America’s Health Insurance Plans (AHIP) issued a more measured response to the AHCA, supporting some revisions in the House plan but expressing concern about others. AHIP had three revolving door connections to the health care committees or members.  Blue Cross/Blue Shield, the largest insurance company in the US, issued a similar statement, and has 15 connections.

The client with the most revolving door connections is the Pharmaceutical Research & Manufacturers of America.  PhRMA, the largest trade association representing the pharmaceutical industry, has not yet taken a position on the healthcare bills

These 285 revolving door lobbyists and their spouses have donated $3.8 million since 2008 to members of Congress serving on these committees — including $1.3 million during the 2016 cycle. Jeffrey MacKinnon, who represents 12 health care clients through his firm Farragut Partners, donated $191,450 since 2016 to mostly Republicans. MacKinnon was Rep. Joe Barton’s (R-Texas) Legislative Director in the early 1990s.

Partisan Donations by Revolving Door Lobbyists

 

 

 

 

 

 

 

 

 

These revolving door lobbyists have donated much more money to Republican members of the five healthcare-focused committees than to Democrats, particularly in 2016, which is unsurprising given that there are more Republicans in Congress.  Although many of these lobbyists have diverse client rosters, with clients from other sectors besides health care, the spike in donations to Republicans in 2016 is striking.  

Partisan Donations by non-Revolving Door Lobbyists

 

 

 

 

 

 

 

 

 

While the partisan breakdown of giving during the past few cycles by health care lobbyists who are not revolvers is similar to that for revolvers, the likelihood of giving is much lower. Of the 1,121 healthcare lobbyists who have not been through the revolving door just 262, or less than a quarter, have given a total of $2.4 million to members of the relevant congressional committees since 2007. By contrast, almost two-thirds of revolvers made contributions to committee members. Another notable difference – prior to 2014 non-revolvers gave considerably more of their money to Democrats, while revolvers gave equally to both major parties, even slightly favoring Republicans.

See more data on the healthcare debate here.

Dan Auble provided the data for this story, Sara Swann and Ashley Balcerzak contributed reporting.

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Categories: Further Reading

The politics behind your Fourth of July celebrations

Open Secrets - Thu, 07/06/2017 - 11:51

Fireworks explode over the Lincoln Memorial, left, Washington Monument, center, and U.S. Capitol, at the National Mall in Washington, Tuesday, July 4, 2017, during the Fourth of July celebration. (AP Photo/Jose Luis Magana)

Fourth of July weekend is all about the red, white and blue. But some of the industries behind the festivities for America’s birthday show more loyalty toward red than blue.

Hamburgers and hotdogs are the go-to food choices for many Americans on the Fourth of July. It’s a big day for the livestock industry, which last year made more than $10 million in campaign contributions. The 2016 total was just shy of beating its all-time high of $10.2 million from 2012.

Last cycle, the livestock industry overwhelmingly gave to Republicans with 81 percent of its contributions to political parties and candidates going to the right. The top contributor in the industry was the National Cattlemen’s Beef Association, which gave 92.3 percent of its 2016 contributions to Republicans. This is in line with the industry’s past partisan splits; since at least 1990 the livestock industry has always given more to Republicans than Democrats. Three-quarters of its overall contributions have gone to red parties and candidates. Donald Trump was the politician who received the most from the livestock industry during the 2016 election (roughly $472,000). Hillary Clinton received almost half of that amount with about $233,000.

As for lobbying in 2016, the livestock industry spent more than $3.3 million — almost as much as its highest lobbying total of nearly $3.5 million in 2006. The biggest lobbying client within the industry was the National Pork Producers Council. Among issues related to the food industry, the council focused its lobbying efforts on legislation that would require disclosure of bioengineered plants and animals used in food products, also known as genetically modified organisms (GMOs).

Hot dogs and burgers wouldn’t make it to the Independence Day festivities without the food processing & sales industry, which has also been loyal to the Republican party. In 2016, this industry made almost $21 million in contributions, its second highest year after 2012. Two-thirds of its contributions to parties and candidates of went to Republicans. Similar to the livestock industry, groups within the food processing & sales industry have consistently given more money to Republicans than Democrats since the 1990 election cycle.

In 2016, Reyes Holdings, one of the largest beer distribution companies in the country, gave the most among organizations in this industry with a total of more than $2.1 million. Nearly all of the group’s political contributions went to Republicans last year (only 1.6 percent went to Democrats). In addition to beer, Reyes Holdings also handles distribution for Coca-Cola brands and McDonald’s restaurants.

Last year the food processing & sales industry reported its lowest lobbying total since 2007 with just over $26.7 million. The biggest lobbying client for the industry, the Grocery Manufacturers Association, mainly focused on issues regarding food safety and the accurate labeling of products.

Celebrating America’s birthday wouldn’t be complete without alcohol, and lots of it. Every year, millions of Americans crack open a cold one to celebrate, making the Fourth of July the top holiday for beer drinking. According to a WalletHub study, more than $1 billion was spent on beer for the holiday in 2016. On top of that, about $568 million was estimated to be spent on wine last year.

The beer, wine & liquor industry saw a record-high contribution total of more than $23.4 million in 2016. This industry distributed its money more evenly; of its contributions to parties and candidates, 54 percent went to Republicans and 46 percent to Democrats.

The top contributors from the beer, wine & liquor industry were the National Beer Wholesalers Association, a membership group for beer distributors, and Anheuser-Busch InBev, which owns a host of beer brands including Budweiser and Stella Artois. In 2016, the two companies’ PACs and employees gave about $3.5 million and $3.2 million, respectively. A majority of both amounts went to Republicans over Democrats.

Last year was also huge for beer, wine & liquor lobbying as the industry reported its highest spending ever with a total of almost $26.9 million. The top lobbying groups for the industry were the Distilled Spirits Council and Anheuser-Busch InBev with about $6 million and $5.7 million, respectively. Some of the issues the groups lobbied on were efforts to prevent underage drinking and various taxes on alcohol production and distribution.

Of course, it wouldn’t be the Fourth of July without fireworks. While fireworks manufacturers are not a big enough player to have their own page on our site, a couple names have been lighting up the political realm. The Consumer Fireworks Safety Association, formerly known as the Washington Independence Day Association, has a modestly sized PAC that has donated $79,750 to candidates since 1994, split almost evenly between Democrats and Republicans. Another trade group, the National Fireworks Association, has spent $120,000 to lobby on “general education of firework operational safety” so far in 2017, according to the latest lobbying disclosure from May 16.

The post The politics behind your Fourth of July celebrations appeared first on OpenSecrets Blog.

Categories: Further Reading

Happy 4th of July!

Open Secrets - Fri, 06/30/2017 - 13:57

The Statue of Liberty in New York. Alexey Filippov/Sputnik via AP

We will be closed until July 5th.
If you are a reporter with an urgent press question, please email press@crp.org. Happy Independence Day from OpenSecrets.org!

The post Happy 4th of July! appeared first on OpenSecrets Blog.

Categories: Further Reading

GOP senators opposing the BCRA don’t have many friends in the health care industry

Open Secrets - Fri, 06/30/2017 - 09:43

President Donald Trump speaks as he meets with Republican senators on health care in the East Room of the White House in Washington, Tuesday, June 27, 2017. Seated with him, from left, are Sen. Dean Heller, R-Nev., Sen. Susan Collins, R-Maine, Sen. Lisa Murkowski, R-Alaska, and Sen. Orrin Hatch, R-Utah. (AP Photo/Susan Walsh)

The list of GOP senators unhappy with the initial draft of the Republican health care bill continues to grow. Before Senate Majority Leader Mitch McConnell (R-Ky.) decided to postpone the vote, six GOP senators announced they would vote against it. Since then, that number has doubled.

Due to McConnell’s pushback, the Senate will not vote on the bill until after the July 4 recess. With the GOP’s slight 52-person majority in the Senate, and no Democrats expected to vote in favor, only three Republicans have to be against the bill for it to fail. As of June 30, the following Republican senators have expressed concerns with the first draft of the bill:

Data from the Center for Responsive Politics shows that from 2012 to 2016, a majority of these names were not very popular among donors within the health care industries. These industries include health insurance and HMOs; health professionals; hospitals and nursing homes; health services; and pharmaceuticals and health products. Eight of the 12 senators received less than $1 million. However, donors did give more than $2.1 million each to Portman and Cassidy, putting them both in the top 10. As for the other senators on this list, their average donation total over the four-year span was just under $693,000.

In comparison, McConnell, who has been leading the charge on the Senate health care bill, topped the 2012-16 list with almost $3.7 million in donations.

While the data is not yet available to see what these senators may have received in donations from the health care industries since the bill was released, in April and May of this year very little money was given to these senators, including McConnell. Heller received the most from the health care industries with $26,500. Trailing him were Cassidy with $8,500; Sasse with $7,500; Portman with $3,000; Moran with $2,500; and Capito with $1,500. The rest reported either zero money or, in Collins’ case, a net return of $2,500.

Although many of these senators were critical of the health care bill, not all of them were solid “no” votes before McConnell’s delay. Capito, for example, had concerns about the bill, but until the vote was pushed back, she hadn’t expressed an explicit decision. Almost immediately after McConnell’s announcement, though, Capito sent out a series of tweets about the health care plan, saying she couldn’t support it. Capito and Portman issued a joint statement explaining why they did not back this draft of the Senate health care bill.

When the health care draft was first released, Cruz, Johnson, Lee and Paul gave a joint statement against the legislation. In his own individual statement, Cruz cited the bill’s not-low-enough premiums as one of the reasons he would vote no. Additionally, the Medicaid cuts in the Senate’s plan were big concerns for Collins and Heller. Heller’s state of Nevada is one of the states that has benefited significantly from the Medicaid expansion under the Affordable Care Act.

Heller in particular was targeted by America First Policies–a 501(c)(4) social welfare organization run by allies of the administration–for his opposition to the health care bill. The group — which is run by several people who were on Donald Trump’s 2016 presidential campaign team — called out Heller on Twitter and planned a series of attack ads against the Nevada senator and his decision to oppose the legislation.

Dan Lee, an assistant professor of political science at the University of Nevada, Las Vegas, said he’s not sure why America First Policies chose to do this because “in a lot of ways Heller is the kind of Republican you wouldn’t want to attack.”

After being scolded by Republican politicians, like McConnell, for the blitz, America First Policies quickly retracted the ad, which ran for about half a day in Nevada. After the organization pulled their ad, their spokesperson, Erin Montgomery, said in a statement they were glad to see Heller was open to negotiations on the bill.

Lee said the group most likely saw Heller’s “no” as more firm than the other senators and chose to focus on him in order to get the bill passed. He added that this tactic fits with the more aggressive posturing Trump himself has shown.

No matter the reasoning for the attack ads, this series of events highlights the trouble Heller is in, Lee said. As one of the most vulnerable incumbents in the 2018 congressional election, Heller has a difficult road ahead. For his reelection, does he appeal to Republican voters or try to sway independents and moderates? For the health care bill, does he vote against it to protect his constituents and their reliance on Medicaid or does he vote “yes” to give Senate Republicans the win they need?

“If he wavers in between, everyone will have an excuse not to like him,” Lee said. “Heller needs to pick a side and go with it.”

In addition to the ad against Heller, America First Policies has also produced several ads attacking Democratic senators for being against the health care bill. All of these Democrats, except for Sen. Tim Kaine (Va.), are from states Trump won in 2016. The ads were almost the same for each senator, with the only change being the name and photo of the politician.

Only time will tell how much this political attack will hurt Heller or the health care bill, said David Damore, a professor of political science at the University of Nevada, Las Vegas. No matter what, he added, it’s going to be hard for the Nevada senator to vote “yes” on this bill.

“The problem for him will be if it still passes, even with his ‘no’ vote,” Damore said. “He could be blamed for not doing enough to stop it. Heller can only hope it all falls apart.”

The post GOP senators opposing the BCRA don’t have many friends in the health care industry appeared first on OpenSecrets Blog.

Categories: Further Reading

Despite its controversies, Uber was more popular than taxis during the 2016 election

Open Secrets - Fri, 06/23/2017 - 11:41

Ride-hailing giant Uber has reported another multimillion dollar loss even as its revenues grow. The San Francisco-based company said on June 1 that its losses in the first quarter narrowed to $708 million from $991 million in the previous three-month period. (AP Photo/Seth Wenig, File)

Travis Kalanick officially announced his resignation as Uber CEO Wednesday morning after taking a leave of absence from the company the week before. Now the ride-hailing service is looking to recover from criticism surrounding sexual harassment and workplace discrimination within the company.

Johan Chu, an assistant professor of organizations and strategy at the University of Chicago, said he’s not sure if the resignation means that much, especially since Kalanick will remain on Uber’s board of directors, but it looks good for the company.

In regards to the next CEO of Uber, Chu said “he or she is going to inherit a hugely ingrained dysfunctional culture.” In order to actually make fundamental changes to improve the company, he added that it will take a lot of “fresh blood.”

“(Uber) does not need people who are used to this kind of culture, who can’t change their way of thinking,” Chu said. “You need an infusion of new people with different viewpoints.”

Despite its controversies, the eight-year-old company has quickly become king of the ride-hailing service industry, making it a huge competitor to taxi companies. In addition to Uber’s popularity with the general public, campaigns and PACs often rely on it for transportation.

During the 2016 election cycle, at least 528 different PACs and candidate committees used Uber, according to FEC expenditure data analyzed by the Center for Responsive Politics. Overall, these committees spent more than $1.03 million on Uber rides. The Democratic Party of Pennsylvania spent the most overall on Uber rides last year (nearly $43,500). Other frequent users of the app were the Republican National Committee, Bernie 2016, Hillary for America and American Bridge 21st Century.

In comparison, about 45 separate committees combined to spend less than $33,500 on Lyft. NextGen Climate Action was Lyft’s biggest customer in 2016, spending just under $6,000 on rides. Jill Stein for President, Bernie 2016, Moveon.org and EMILY’s List also spent significant amounts on the ride-hailing service.

Finally, Lyft and Uber haven’t managed to drive old-fashioned taxis out of business just yet. PACs and candidate committees spent at least $261,500 on cab fare during the 2016 election cycle. Russ Feingold’s campaign, the biggest taxi user, spent over $27,000 on taxis and next to nothing with Lyft or Uber.

More than 300 PACs and candidate committees used Uber exclusively, almost 100 took only taxis and nine were loyal to Lyft.

Last year’s election showed a drastic increase in Uber’s political involvement. Like many young tech companies, Uber doesn’t have a PAC, and before 2016, Uber affiliates had barely made any political donations at the federal level. During the last election year, however, the company saw a huge spike in contributions; the company and its employees gave about $331,000. Although this is not a large total for a major corporation, it is still significant considering the company’s age and the fact that it made virtually no contributions before 2016. $200,000 came directly from the company’s treasury to committees that can accept corporate contributions, including a $190,000 donation to the host committee for the Democratic convention in Philadelphia; the rest was donated by the company’s employees. More than $309,000 of this overall total was given to Democratic party committees and candidates and about $9,000 was given to Republicans.

A big chunk of Uber’s time and money has been spent on lobbying — $1.36 million in 2016 to be exact. This total is nearly triple what was spent the year before and a huge leap from the mere $50,000 that was spent in 2013 (the first year Uber reported lobbying data).

Last year, Uber was the second biggest lobbyist for the miscellaneous transport industry, spending $60,000 less than the top lobbyist, the American Public Transport Association.

As far as issues go, Uber lobbied on matters related to improving transportation and mobility for the elderly, veterans and people with disabilities. The start-up also lobbied on issues related to the sharing economy and the impact of federal taxes on transportation costs.

So far this year Uber has spent $370,000 on lobbying, according to the latest report from April 24. If it keeps up the same pace throughout the rest of the year, the 2017 lobbying total will be about $1.11 million. A new issue Uber started to lobby on this year is self-driving vehicles for commercial purposes.

Before his resignation, Kalanick had been spearheading the company’s expansion into self-driving cars. In addition, prior to the CEO’s departure, Uber announced it would start allowing riders to tip their drivers.

Chu said this kind of change to the company looks like “window-dressing.” He added that tipping drivers is not really a big change to make, and it will do more to pacify Uber’s critics than anything else.

Kalanick’s resignation — or more realistically, his firing — is more symbolic than anything else, said Mark Mizruchi, a professor of sociology at the University of Michigan. “It strikes me that this was done because Uber investors felt something had to be done regarding the recent controversy,” he said.

The post Despite its controversies, Uber was more popular than taxis during the 2016 election appeared first on OpenSecrets Blog.

Categories: Further Reading

Fearing border tax, retailers boost lobbying 31 percent

Open Secrets - Fri, 06/23/2017 - 07:50

President Donald Trump at a listening session with CEOs from the retail industry in February. Seated from left to right are Marvin Ellison of J.C. Penney, Jill Soltau of Jo-Ann Stores LLC, and Art Peck of Gap Inc. (Rex Features via AP Images)

It’s been a remarkably tough year for the retail sector. So far in 2017, retailers have set a record pace for bankruptcies and store closings. Household names are faring no better than small shops: J.C. Penney said it would shutter 138 locations in July; Macy’s expects 68 locations to close this year; and Sears Holdings will turn off the lights at over 170 Kmart and Sears stores. Since January, 50,000 retail jobs have been cut.

Credit ratings agency Moody’s added to an already-grim outlook when, earlier this month, its list of U.S. retailers at risk of bankruptcy rose to 22. That’s higher than the 19 at-risk retailers singled out during the financial crisis.

Amid this gloomy picture, retailers are lobbying more than ever. Lobbying expenditures rose by 31 percent in the first quarter of 2017 compared with the same period last year. So far in 2017, retailers have spent $16.4 million lobbying Congress. They spent $45.8 million last year.

Retailers are pushing for “anything that puts money in the consumer’s pocket,” says Howard Davidowitz, an independent retail consultant. That means tax cuts are a top priority.

It’s little surprise that lobbying spiked as Republican leadership in the House has called for a border adjustment tax. To encourage domestic production, the controversial tax arrangement would tax exporters at a lower rate than importers by allowing companies to deduct the cost of American-made goods from taxable revenue. Retailers, whose products are mostly imported, would be hard hit under the proposal. They argue that consumers would ultimately bear the cost of such a tax—to the tune of $1,700 each year—through higher prices.

Retailers jumped into action to oppose the bill. CEOs of Target, Best Buy, and J.C. Penney, among others, met with President Trump in February. Retailers joined oil refiners and automakers to launch Americans for Affordable Products, an advocacy group that has aired ads criticizing the tax proposal. (Companies that primarily export, like Boeing and Dow Chemical, formed their own group—the American Made Coalition—in opposition.)

Testifying before the House Ways and Means Committee, Target CEO Brian Cornell estimated that Target’s tax rate would increase by 40 percent with a border tax. He added that Target’s customers—“middle-class working families whose budgets are already stretched”—would bear the brunt through price hikes. Cornell got a sympathetic response from Rep. Erik Paulsen (R-Minn.), who once worked for Target and now represents a district in the company’s home state. Paulsen said he could not support border adjustment in its current form. Behind the scenes, Target has spent $1.3 million lobbying just this year—jumping from number ten to number four in lobbying outlays among retailers since 2016, when it spent $1.7 million.

Those efforts have kept border adjustment at bay. In an interview with CNBC last month, Treasury Secretary Steven Mnuchin criticized the scheme for creating an uneven playing field with “different impacts on different companies.” In private he has signaled to lawmakers that the tax proposal does not have White House backing.

But retailers will not rest easy until they’ve killed off talk of border adjustment for good. That hasn’t happened yet: Border adjustment is tied to corporate tax reform, a centerpiece of the Republican agenda. (Authors of the Republican tax blueprint claim that border adjustment will raise $1 trillion in tax revenue over a decade, which will be necessary to offset revenue losses from their goal of a significantly lower headline corporate tax rate.) On Tuesday Speaker Paul Ryan (R-Wis.) made clear that he plans to push ahead with a tax overhaul in 2017. Earlier this month, House Ways and Means Committee Chairman Kevin Brady (R-Texas) said he wants to see border adjustment phased in over five years.

Another lobbying issue for retailers is a digital sales tax. Here retailers are divided: On one side are remote sellers that have no obligation under federal law to collect and remit tax on Internet sales. On the other side are big-box retailers and Amazon, which do charge sales tax. In April, senators reintroduced a bill known as the Marketplace Fairness Act to address the discrepancy. (It passed the Senate in 2013 but never made it to the House.) The National Retail Federation, a trade group that has spent $2.3 million lobbying this year, backs the bill.

A digital sales tax seems low on the list of lawmaker priorities. Mired in debates over healthcare and corporate tax reform, “Congress has bigger fish to fry,” says Richard Pomp, a law professor at the University of Connecticut.

Part of the retail lobbying frenzy this year is due simply to the fact that there’s a new administration, adds Davidowitz, the consultant. “There’s a tremendous amount of change being talked about. It would be understandable that you want to get the word in as quickly as you can to the new people.”

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Categories: Further Reading

Outside groups kick into high gear post-primary in Georgia, South Carolina

Open Secrets - Mon, 06/19/2017 - 08:29

The special election in Georgia’s 6th District is already the most expensive House race ever. (Branden Camp/Atlanta Journal-Constitution via AP)

On Tuesday, voters in Georgia’s 6th Congressional District will vote in the most expensive House election ever. A staggering $56.7 million (at least) has been spent on the special election, including $51.9 million on the two candidates left standing after the primary. The race between Democrat Jon Ossoff and Republican Karen Handel is the most expensive House race in history, easily overtaking Florida 18’s 2012 election, which cost $29.5 million.

The money supporting Ossoff and Handel comes from different sources. Ossoff’s campaign has a massive war chest thanks to his popularity with small donors, whereas Handel has had to rely on the aid of super PACs and other outside groups. 

Ossoff’s immense success in raising money from individuals, especially small donors, started before the primary. He received about $8.3 million by April 18, and reported raising nearly double that again on his most recent FEC report. Through May 31, he has received about $23.6 million, with almost 65 percent of those funds coming from donations of $200 or less. He raised an additional $400,000 in the first week of June, bringing his total to at least $24 million. Although Handel also saw a significant increase in donations after the primary, her total of $4.5 million through May 31, with 35 percent coming from small donors, is dwarfed by Ossoff’s fundraising. Handel raised an additional $173,000 in the first two weeks of June.

Where Handel has Ossoff beat, however, is in outside spending totals. Super PACs have not been shy about showing their support for either candidate, but Handel has been the beneficiary of twice as much outside money as Ossoff. Outside spending boosting her campaign or attacking Ossoff totaled $18.2 million as of June 19, against just under $8 million by groups backing Ossoff or opposing Handel. 

Including only expenditures since the April 18 primary, groups on Handel’s side spent $12.2 million, versus $7 million for Ossoff.

The biggest outside players on Handel’s team were the Congressional Leadership Fund, a super PAC closely tied to the House GOP, which spent more than $6.5 million, and the National Republican Congressional Committee at about $6.7 million. The top two groups backing Ossoff are the Democratic Congressional Campaign Committee with about $5 million in independent expenditures and Planned Parenthood Action Fund at about $820,000.

Why are both parties so heavily invested in one special election? Ryan Bakker, an associate professor of political science at the University of Georgia, said it comes down to a reaction to President Trump. The Republicans have held this seat since 1979, so losing this election would be a “really hard hit,” Bakker said. It would also reveal fractures between Republicans who align themselves with Trump and those who don’t, he added. (Handel so far has not made any indications on how she feels about the president.)

For Democrats, Georgia’s 6th district is appealing because it is a chance to flip a Republican seat. Recently, the north side of Atlanta (which is part of the district) has seen huge growth in its population of minorities and more liberal young people, Bakker said. This explains why Ossoff, a young (30), charismatic and moderate Democratic candidate, has a shot in a typically red district.

“If Ossoff had not come so close to winning the district in the primary, you wouldn’t see this kind of money being spent on the election,” Bakker said. “Democrats know the importance of flipping a historically red district so their thought process is: ‘If they can flip Georgia 6, they can flip anything.’” He added that winning this district would give Democrats momentum for the 2018 elections.

In the April 18 primary, in which both Republicans and Democrats competed on the same ballot, Ossoff won the most votes — 48.1 percent — but came up just short of the 50 percent necessary to win the seat without a runoff election. With the Republican vote divided between several candidates, Handel came in second place at 19.8 percent. The winner of the runoff will replace Republican Tom Price, who vacated his seat after being appointed President Donald Trump’s Secretary of Health and Human Services in February.

So how have Ossoff and Handel spent all of this money? Ads, ads and more ads.

The two candidates together have spent about $25.6 million, according to their combined disbursement totals for the pre-special and pre-runoff FEC filings. Most of this money has been dedicated to TV ads.

“Handel has really been on the attack (with the ads), putting Ossoff on the defensive,” Bakker said. Ossoff has made ads attacking Handel as well, although not as many. In one ad, breast cancer survivors criticize Handel for cutting grants to Planned Parenthood (which helps women get referrals for mammograms) while she was at the Susan G. Komen Foundation.

The vast majority of outside spending has also been on media, primarily TV ads. The Congressional Leadership Fund alone has produced at least 15 ads attacking Ossoff, according to their YouTube account. The videos criticize Ossoff’s ties to Minority Leader Nancy Pelosi (D-Calif.) and call him dishonest.

Fewer attack ads have been made about Handel, but the DCCC has produced several, including ones that criticized Handel’s budget cuts and called her a “self-serving politician.”

Over in South Carolina’s solidly red 5th congressional district, the race to replace Trump’s budget chief Mick Mulvaney in the House has attracted far fewer dollars. Republican Ralph Norman, a former state representative and real estate developer, faces off against Democrat Archie Parnell, a tax attorney whose resume includes Goldman Sachs.

Through May 31, FEC reports showed that Norman’s campaign had raised almost $1.3 million and Parnell’s just over $763,000. A good chunk of this comes from the candidates’ own wallets: The May filings show that Norman loaned his campaign $495,000, or close to 40 percent of his total. Parnell also pitched in almost 40 percent of his total fundraising, by donating $100,000 of his own money and giving a $205,000 loan to his campaign. 

Some may recognize the 5th district of South Carolina as Frank Underwood’s district in the hit Netflix series House of Cards. Parnell has taken advantage of this connection by mimicking the fictional character in his campaign ads.

Spending by super PACs and political nonprofits in both the primaries and general election has totaled just over $2 million, nearly all directed toward Republican candidates. Since Norman eked out a victory over the more moderate Republican Tommy Pope in a primary runoff, outside spending has totaled just $85,000. The biggest spender during the primaries was an organization called CLA Inc. Newly registered with the FEC, it spent nearly $400,000 backing Pope, who also got help from the U.S. Chamber of Commerce, among other groups. Support for Norman came primarily from the conservative Club for Growth and the Senate Conservatives Fund, a super PAC founded by former South Carolina Republican Senator Jim DeMint.

Democrats — light spenders in South Carolina’s 5th — view that money as better spent elsewhere, like in neighboring Georgia. Jamie Carson, a political science professor at the University of Georgia, said Democrats see Georgia as more winnable. “Certain races become high profile,” Carson said. “If people see a race as competitive, they are more likely to spend money on it.”

Reporting intern Kennett Werner contributed to this post.

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Categories: Further Reading

Trump earned at least $1.3 billion in the last two and a half years

Open Secrets - Fri, 06/16/2017 - 18:23

In the last year, Trump has made $37 million from the Mar-A-Lago club, which has served as his second White House. (AP Photo/Alex Brandon)

The Trump presidency is less than five months old, but has been a quick study at one longstanding D.C. tradition: the Friday-night dump. Administrations often release promised documents once journalists have left the office for the weekend, hoping that any damaging info would get lost in the news cycle turnover. Today, the U.S. Office of Government Ethics has followed suit and released a 98-page document detailing the president’s financial holdings, income and liabilities from the preceding 16 months.

The filing is not required by law, but has traditionally been released by presidents after assuming office. It is our first real insight into how the president has been disentangling himself from his business interests, and shows how the valuation of the Trump brand has changed. So far, Trump has released three personal financial disclosure statements which collectively cover January 1st, 2014 to April 25th, 2017.

The newest form lays out the steps Trump took after November’s victory to shift his assets around to avoid conflicts of interest. In the days leading up to and following the election, Trump dissolved 28 of his business entities and transferred his stake in his remaining companies to his children and a revocable trust from which he continues to draw income. Among the companies dissolved were a number of entities which appear to have been managing Trump’s global business ventures in Saudi Arabia, Qatar, Puerto Rico and Argentina.  

Trump also seems to have divested from a majority of his stock holdings. Among the stocks that Trump has sold are his shares of Energy Transfer Partners, the company building the controversial Dakota Access pipeline. ETP, whose CEO Kelcy Warren is a Trump donor, is facing new challenges in court to the pipeline, which the Trump administration approved by executive order shortly after taking office.  

Despite having sold off the majority of his stocks, Trump’s trust continues to hold on to at least $1.4 billion worth of other real estate and business assets. In addition to various checking and savings accounts, Trump has between $100,001 and $250,000 invested in gold, and between $1,000,001 and $5,000,000 in a private equity fund called the MidOcean Credit Opportunity Fund, which invests primarily in bank debt.

The form only requires assets held at the end of the reporting period to be disclosed and doesn’t require documentation of any transactions, so we have no way of telling how much income Trump generated by divesting. We do know that Trump reported making at least $597 million during 2016 and the first part of 2017 off the at least $1.4 billion worth of assets that he has retained. For comparison in 2014 and the first part of 2015 Trump made an estimated $429 million off what was then nearly $1.5 billion in assets. Because the law only requires the filer to disclose their income and asset values in ranges, we can’t get a perfectly accurate picture. The top income range is $5,000,000 or more; Trump had nine assets that generated at least that much income.   

As for Trump’s income for the last year, the standout is the $37 million he made off the Mar-A-Lago Club, which has also served as a second White House. Over a similar 16 month period covered by Trump’s first financial disclosure (January 2014 to April 2015) the club only brought in $15.5 million. That’s a 139 percent increase in income, part of which may have to do with the doubling of membership fees at Mar-A-Lago earlier this year.

Another one of Trump’s more controversial business ventures, the Old Post Office Building, earned him $19 million during the reporting period. The building is owned by the federal government, and elected officials were specifically excluded from the leaseAfter much back and forth with Trump’s lawyers, the General Services Administration decided that Trump’s financial rearrangement was sufficient and allowed him to keep his lease on the building, which has been converted into a hotel.

The graph below shows the the breakdown of the monthly income that Trump has listed on his three financial disclosure forms.

Since announcing his run for office in June of 2015, Trump has made at least $1.3 billion off his various business ventures and investments.  

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Categories: Further Reading

Some lawmakers owe their dads a big thank you this Father’s Day

Open Secrets - Thu, 06/15/2017 - 07:46

Republican Trey Hollingsworth got a boost in his congressional race from his father, who gave $1.5 million to a super PAC backing his son. (New and Tribune/Josh Hicks via AP)

There isn’t much that fathers wouldn’t do for their kids, especially in politics.

Take this famous quote from former President John F. Kennedy: “I just received the following wire from my generous Daddy; ‘Dear Jack, Don’t buy a single vote more than is necessary. I’ll be damned if I’m going to pay for a landslide.'”

That’s right, ‘rents bankrolling your future extends past writing the hefty tuition check to helping sway the electorate. In Indiana this past election, winner Rep. Trey Hollingsworth (R) also got a helpful boost from his old man. His father Joe gave almost $1.5 million to a super PAC called Indiana Jobs Now, which cannot legally coordinate with Trey’s campaign. Joe was the sole funder. The group spent $860,000 attacking three of Trey’s rivals, and $400,000 to help his campaign.

We’ve even seen a dad go to jail for his lawmaker son. The father of Rep. Ami Bera (D-Calif.) was sentenced to a year of jail time last year for organizing a straw donor scheme to fund his son’s first two congressional runs in 2010 and 2012. Prosecutors found Babulal Bera solicited at least $260,000 worth of donations from family and friends that were within the campaign finance limits, but then reimbursed these donations, which is illegal.

Their financial support doesn’t always pay off. Democrat Patrick Murphy, who ran for the Florida Senate and lost to Sen. Marco Rubio (R), also had help from his pops. His father Thomas Murphy gave $450,000 to a pro-Murphy super PAC called Floridians for a Strong Middle Class, while his construction company, Coastal Construction Group, donated $300,000. Their donations made up about a quarter of the super PAC’s donations.

Karl Fetterman gave $100,000 to The 15104, a super PAC backing his son, John Fetterman, a Democrat and mayor of Braddock who ran in the Pennsylvania Senate primary last year. The group only raised $136,000, and $126,000 came from Karl and Gregg Fetterman, both working for Kling Brothers Insurance Agency.

And Paul G. Sittenfield gave $100,000 to New Leadership For Ohio, a super PAC supporting his son, Democrat P.G. Sittenfield, who lost in the 2016 Ohio Senate primary. But what about the other way around? It is almost Father’s Day, after all. All four of Sen. Richard Blumenthal‘s (D-Conn.) children gave the maximum allowed to his campaign last cycle, and at least three out of four of Rep. John Fleming‘s (R-La.) kids did the same for their father. Some fathers aren’t so lucky: Neither Ivanka, Eric, Donald Jr., Tiffany nor Barron donated to their dad’s presidential campaign. Besides cold hard cash, a father’s advice and example can be quite the help when running for office. We can’t forget the political dynasties, like Florida Gov. Jeb Bush and former President George W. Bush following in their father’s footsteps, or Rep. Rodney P. Frelinghuysen (R-N.J.), a sixth generation Frelinghuysen to serve in Congress, stretching all the way back to 1794Sen. Lisa Murkowski‘s (R) father, Frank Murkowski, appointed her to fill his Alaska Senate seat, after he stepped down to become governor in 2002. She won a full term in 2004 and again in 2010 and 2016.

Researchers Douglas Weber and Andrew Mayersohn contributed to this post. 

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Categories: Further Reading

Among NBA owners, Betsy DeVos’s father-in-law tops donors

Open Secrets - Thu, 06/08/2017 - 13:21

If political giving by their owners was the deciding factor in who wins the NBA finals, the Cleveland Cavaliers ($5 million since 1989) would trounce the Golden State Warriors ($124,000.) (AP Photo/Tony Dejak)

There’s big money to be made—for players, agents, and networks—in the NBA Finals currently underway. But while the Golden State Warriors battle the Cleveland Cavaliers on the court, off court, NBA team owners have been making some sizable political contributions.

In fact, the generous and deep-pocketed NBA owners gave just under $12 million in 2016, with Democrat Hillary Clinton the favored presidential candidate. She drew nearly $77,000 in direct contributions, while her joint fundraising committees secured $1.2 million from at least 22 individuals, including owners and their spouses. By contrast, just three owner pairs gave a total of $10,800 to President Donald Trump directly; his joint fundraising committee drew just over $869,000. That bucks a general historical trend—since 1989, NBA owners have donated just under $21.6 million to Republicans and $10.4 million to Democrats in congressional and presidential elections.

It was Richard DeVos, founder of Amway and owner of the Orlando Magic, who led the pack in spending among NBA owners in 2016. He and his wife, Helen, donated $3.9 million to Republican election efforts. They skirted Trump in the primary, giving $250,000 each to super PACs supporting Ted Cruz, Jeb Bush, and Carly Fiorina. (They also donated directly to Cruz, Bush and Scott Walker.) DeVos added another $750,000 to a super PAC started by the Trump-averse conservative Koch network, Freedom Partners Action Fund. But DeVos came around to Trump in the general election with a $70,000 check to his joint fundraising committee, Trump Victory. His daughter-in-law, Betsy DeVos, now serves as Trump’s education secretary.

DeVos and his wife have been the biggest spenders among NBA owners for years. Since 1989, they’ve doled out $7.3 million to federal candidates, party committees, and outside spending groups.

Cavs majority owner Dan Gilbert and his wife, Jennifer, came in second of the lot in 2016. They shelled out $2.1 million that cycle, with just over half of that landing in the coffers of a super PAC backing GOP candidate Chris Christie, America Leads ($1.3 million.) Another $350,000 went to a super PAC behind Republican John Kasich, New Day for America. In the general election, Gilbert veered left, donating $150,000 to Clinton’s joint fundraising committee, Hillary Victory Fund.

Cavs minority owner Gordon Gund and his wife Llura claimed the number three spot among NBA owner-donors. Of their $1.4 million in campaign contributions in 2016, $750,000 went to super PACs affiliated with Kasich. But the Gunds went for Clinton in the general election, giving $30,000 to her joint fundraising committee.

Contributions to Trump’s election effort came from just three team owner pairs: Peter and Julianna Holt of the San Antonio Spurs, James Dolan of the New York Knicks, and DeVos. Holt was the biggest Trump booster; he and his wife donated just under $500,000 to Trump’s joint fundraising committee, of which Trump received $5,400; the rest went to GOP party committees. Not far behind was Dolan, who gave $300,000, $2,700 going into Trump’s coffers.

Among Clinton’s top donors was Marc and Cathy Lasry of the Philadelphia 76ers, who gave just under $178,000 to her joint fundraising committee. Trailing behind were Ted and Lynn Leonsis of the Washington Wizards (just over $158,000), Will and Jada Pinkett Smith, who are minority stakeholders of the 76ers ($150,000), Stan Kroenke of the Denver Nuggets ($100,000) and Herbert and Bui Simon of the Pacers ($100,000.)

While owners contributed generously in 2016, players and coaches tend to sit on the sidelines when it comes to political giving. Of those competing in the finals, neither Warriors nor Cavs players donated.

Whether 2018 will have owners opening their wallets as wide remains to be seen. So far, they’ve put just over $142,000 into the midterms.

Researcher Alex Baumgart contributed to this post.

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Categories: Further Reading

Your summer vacation: Democratic or Republican?

Open Secrets - Thu, 06/08/2017 - 06:07

Think a little vacation would get your mind off politics for awhile? (AP Photo/Alex Menendez)

The Trump International Hotel in Washington may have raked in the profits during the inauguration festivities — and ever since, come to think of it. But for most in the lodging and tourism industry, high season is just gearing up.

It’s a set of interests that was exceptionally involved in politics during the past two years, investing more in political candidates, parties and outside spending groups during the 2016 election cycle than ever before. The industry broke spending records with its contributions of nearly $24 million. Its lobbying outlays, too, topped previous levels in 2016 at about $12.4 million.

Not only that, but these hotels, resorts and travel companies shifted to the left in the last cycle: 62 percent of the funds it gave to politicians and parties went to Democrats. The last time the industry was this partisan was in 2002 when it gave 64 percent of its candidate and party donations to Republicans. Most of the contributions were from individuals, rather than company or trade group PACs.

A couple of new donors emerged to become top contributors. The Philadelphia Convention & Visitors Bureau gave the most with about $4.8 million — all of which went to the Democratic Party, which held its presidential nominating convention in that city last year. And American Pacific International Capital, an international holding company that owns boutique hotels in the U.S. and large luxury hotels in China, came in third with $1.3 million; it had never before made the industry’s top 20.

Others in the 2016 top five — Diamond Resorts, which specializes in timeshares ($2.1 million), the American Hotel & Lodging Association ($965,000) and TRT Holdings, which owns Omni Hotels ($890,000) — were more familiar contributors from the industry. While Diamond Resorts kept with the group’s overall liberal leanings, AHLA and TRT Holdings both favored Republicans.

Vanessa Sinders, senior vice president for government affairs at the AHLA, said the organization has become more proactive in telling the tourism industry’s narrative by communicating with politicians and advocating on the issues it cares about.

“We have been and continue to be a very bipartisan organization,” Sinders said. “We work with both sides of the aisle to get things done.”

Marriott International, one of the lodging and tourism industry’s top five contributors for the past two decades, was pushed down to No. 6 on the list with $811,000. Historically, Marriott has been among the industry’s biggest GOP supporters, but in 2016 both its PAC and its employees favored Democrats, following the industry-wide trend.

Marriott also sat in the industry’s No. 6 spot in spending to lobby the government last year, with outlays of $670,000. Ahead of it in the rankings was the Dorchester Group, an offshoot of a company owned by the government of Brunei, which spent $1.1 million. Dorchester Group is relatively new to the lobbying scene and reported record expenditures for this activity in 2016.

The other top lobbying clients for the lodging and tourism industry in 2016 were the AHLA ($2.4million), the U.S. Travel Association ($2.3 million), the International Association of Amusement Parks & Attractions ($1.2 million) and Blackstone Group , which has big investments in Hilton Hotels, La Quinta Inns & Suites, Motel 6 and Wyndham.

What do hotels and similar companies care about in D.C.? Many issues, it turns out. A few from last year included:

  • Opposing any cut in the per diem for government employees (or how much they’re allowed to spend on lodging, meals and the like when they travel for government business)
  • Stopping online booking scams, where customers book hotels through third-party websites that often are not legitimate
  • Supporting free travel to Cuba (the Trump administration is reportedly considering reinstating travel restrictions that were liberalized by former President Barack Obama)
  • Encouraging more rules and regulations to be applied to Airbnb rentals, a chief source of competition for hotels in recent years

For issues like online booking scams, Sinders said the tourism industry has seen an drastic increase in the number of people concerned about them. In 2015, about 6 percent of hotel-goers were were worried about online booking scams. But, Sinders said, this number jumped up to 22 percent in 2016, which is partly why AHLA has more actively lobbied on the subject.

“We are working with Congress and the Federal Trade Commission on ways to fix this issue,” Sinders said. She added that legislation with bipartisan support has been introduced to Congress that would require third-party websites to explicitly state they are not affiliated with a hotel.

Other ways to get out of town

Much like the lodging and tourism industry, the cruise industry also topped its personal best in contributions to candidates, parties and outside spending groups in the 2016 election. Its nearly $2 million in contributions almost doubled its previous record of about $1 million.

Cruise lines tend to have a more conservative bend than hotel companies, though: The industry gave 57 percent of its donations to candidates and party committees to Republicans. Its top contributors were Carnival Corp. and Norwegian Cruise Line with $940,000 and $320,000, respectively.

The 2016 lobbying total for cruise ships and lines was consistent with the past few years, although not the highest in its history. Last year the industry spent about $3.2 million on lobbying, with fully half of that coming from the Cruise Lines International Association with $1.6 million. Its top issues were taxes and a measure having to do with payments to stewards on the industry’s ships.

Airlines — that increasingly unpopular element of tourism — pumped big money into the 2016 election: $7.5 million in contributions, its largest sum since 1990. About 52 percent of the funds these companies gave to candidates and party committees went to Democrats this time around, up from their average of 45 percent. The airlines industry’s turn to the left parallels that of the lodging and tourism industry, although the switch is not as sharp.

The top contributors in the industry were American Airlines Group with $2.4 million; Delta Air Lines with $1.8 million; and United Continental Holdings (which owns United Airlines) with about $1 million. American Airlines Group and Delta Air Lines both favored Democrats with their contributions, while United gave slightly more to Republicans.

All three top contributors were big in the lobbying arena as well. American Airlines Group topped the list with $7.9 million spent, edging out No. 2 Airlines for America‘s $6.4 million and more than double the $3.5 million spent by United Continental Holdings, which came in at No. 3. Delta Air Lines followed, spending $2.5 million. Issues? You name it, but the long laundry list includes such things as transportation security, passengers’ rights and aircraft noise and emissions.

And to circle back to Donald Trump’s hotels: Astonishingly, the Trump Organization contributed only $51,463 in the 2016 cycle — less than it has given in any election cycle since 1992. Not as surprisingly, more than 95 percent of that went to Republicans.

The sum doesn’t include donations Trump made to his own presidential campaign, though, totaling almost $66 million, or close to 20 percent of the funds he raised.

And you thought a nice vacation would be a break from nasty partisan politics…

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Categories: Further Reading

Turkey lobbying Texas legislature to go after Gulen-connected schools

Open Secrets - Tue, 06/06/2017 - 12:17

Turkey’s President Recep Tayyip Erdogan blames cleric Fethullah Gulen for a failed coup attempt in 2016. (Kayhan Ozer/Presidential Press Service, Pool Photo via AP)

There isn’t much Turkey wouldn’t do to go after Fethullah Gulen, the controversial cleric Turkish leader Recep Tayyip Erdogan blames for a failed coup in 2016.

Last fall, former National Security Adviser Michael Flynn and Turkish officials reportedly considered going beyond trying to convince the U.S. to extradite Gulen, who lives in exile in Pennsylvania: They discussed “a covert step in the dead of night to whisk this guy away,” James Woolsey, a Flynn Intel Group board member and former CIA director, told the Wall Street Journal.

But the plot gets as granular as agents lobbying Texas legislators to pass bills forcing charter schools in the state to be more transparent, according to a Justice Department filing from the end of May.

Why Texas? That’s where Harmony Public Schools is headquartered, a charter school system that Turkey alleges is a cog in a vast network tied to the controversial cleric Fethullah Gulen.

Harmony has denied the claim, but a number of individuals associated with the schools are followers of Gulen. And they’re quite active in politics: A CRP analysis found that 20 Harmony employees or vendors donated more than $350,000 at the federal level in the last three elections, $255,000 of which went to liberals. This group gave more than $110,000 to the Democratic Congressional Campaign Committee, $50,000 to former President Obama’s joint fundraising committee and $42,000 to Rep. Sheila Jackson Lee (D-Texas). They also contributed to state politicians.

Last July, the Turkish government filed a complaint with the Texas Education Agency, alleging Harmony abused public money, used discriminatory hiring practices and favored certain vendors in violation of competitive bidding rules. The agency dismissed the complaint in October, saying it didn’t warrant an investigation.

Reports indicate that some Gulen-connected schools, including some in Ohio, are under FBI investigation, though the scope of the investigation is unclear.

Amsterdam & Partners, which was hired to file the complaint, subcontracted the legislative angle to Arnold Public Affairs, the firm listed on the Justice Department’s Foreign Agents Registration Act filing. Arnold Public Affairs was hired last April on a $20,000 monthly contract, which dropped to $15,000 in January.

According to principal Jim Arnold, his firm is promoting legislation that would require charter school meetings to be streamed and posted online, as well as to disclose additional information about their business transactions in their annual financial reports. The firm met with lawmakers, widely circulated a derogatory media story to them and their staffs and filed cards of support, meaning they publicly endorsed the legislation.

“Transparency is good, whether for public schools and charter schools, and there isn’t much transparency in the business that Harmony conducts,” Arnold said. “That was the purpose of these bills. Anything we can do to shed some light on the interconnected network and transactions… Harmony is the largest charter school network in Texas and is connected to Gulen.”

Harmony Public Schools did not return multiple calls seeking comment.

Neither bill made it to Republican Gov. Greg Abbott’s desk. Texas’ legislative session is over, but the firm is working with legislators to try to tack some parts of the bills onto other measures as amendments before June 18, the deadline for the governor to sign or veto a bill.

But the association representing 90 percent of Texas charter schools, including Harmony, says reporting requirements are already stringent.

“We are subject to the same open meetings act and public information act requirements as public schools,” said Christine Isett, director of communications for the Texas Charter School Association. “All of our information is transparent.” Currently schools with more than 10,000 students are required to post videos of their meetings online seven days after the event takes place, but most schools are much smaller than that.

The Turkish government has mentioned Gulen in almost 20 FARA filings in the past two years, according to a CRP analysisAmsterdam & Partners contacted the press, state legislators and the Texas attorney general about Harmony and Gulen’s alleged role in the attempted coup.

Flynn’s firm, Flynn Intel Group, had been working on convincing the U.S. government to extradite Gulen. The firm closed last November. Flynn Intel Group also earned more than $500,000 to create an anti-Gulen documentary, according to The Wall Street Journal. A reporter working on the film said he was told to hide the Flynn firm’s involvement in the project.

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Categories: Further Reading

Release of ethics waivers still problematic

Open Secrets - Mon, 06/05/2017 - 13:58

Walter M. Shaub Jr., director of the U.S. Office of Government Ethics, has some problems with the ethics waivers granted by the White House. (AP Photo/J. Scott Applewhite)

After a standoff with the Office of Government Ethics over whether the White House had to disclose ethics waivers given to White House staff members, the Trump administration blinked first. On May 31st, the administration disclosed that it has issued 14 waivers — more than four times the amount Barack Obama granted during his first four months and almost as many as he granted during his entire time in the Oval Office. These waivers are exceptions to an executive order Trump passed during his first week in office, preventing White House staff members from being involved in past lobbying issues or matters related to their previous work.

But the clash isn’t over. If the waivers indicate how often Trump is willing to put aside his own rules for favored staffers, they’re also incomplete, says OGE. Only four of the 14 have dates indicating when they were approved. Three of the four are initialed and just one is signed. The other 10 are undated and without signatures. A White House spokesperson did not answer questions from The New York Times as to why some of the ethics waivers had no dates, and OGE is pressing the same questions.

Among those receiving waivers were Trump’s Senior White House Adviser Kellyanne Conway and Chief of Staff Reince Priebus. They were both granted permission to continue communication with organizations they had previous ties to before joining the Trump administration.

The president’s chief strategist, Steven Bannon, benefits from a blanket waiver allowing him to communicate with Breitbart News, where he was formerly an executive. Citizens for Responsibility and Ethics in Washington filed a complaint against Bannon for communicating with Breitbart despite it being prohibited. But the waiver was described as “retroactive” — something that doesn’t sit well with ethics watchdogs.

“There’s no such thing as a retroactive waiver,” OGE Chief Walter M. Shaub Jr. told the New York Times. “If you need a retroactive waiver, you have violated a rule.”

Trump himself has said he wants less lobbyist influence in Washington, but he also has signed off on a number of waivers for former lobbyists who now advise him in areas they previously lobbied. They include Michael Catanzaro and Andrew Olmem, who are both special assistants to the president, among others. Catanzaro’s waiver grants him permission to participate in matters related to energy and the environment — issues he previously lobbied on for Devon Energy, an oil and gas company. Similarly, Olmem is allowed to communicate with former clients from his lobbying days about Puerto Rico’s financial issues.

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Categories: Further Reading

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