Tag: campaign financing
The New Holy Grail Of Republican Primaries

The New Holy Grail Of Republican Primaries

[This originally appeared in The Washington Spectator.]

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Silicon Valley Emerges As A Political Force

Silicon Valley Emerges As A Political Force

When Jeb Bush visited Silicon Valley this week, the Republican candidate was visiting the heart of a Democratic state that few expect to be contested in the 2016 presidential election. But when it comes to the political money chase, the Northern California home of the world’s technology giants spreads the wealth to both parties — positioning the tech industry as one of the most powerful forces in American politics.

Since 2008, the Internet firms, software companies, computer manufacturers and data processors that comprise Silicon Valley have delivered more than $172 million worth of campaign contributions in federal elections, according to data compiled by the Center for Responsive Politics. That’s a nearly 40 percent increase over the prior 8 years. Counting only presidential election years, the increase is even more dramatic: The $109 million of Silicon Valley money pumped into the 2008 and 2012 elections represents a 61 percent increase from 2004 and 2000.

Out of the money given directly to candidates (as opposed to third party groups) since 2008, Democrats have received 62 percent of the contributions. But Republicans’ 37 percent in that same time was hardly pocket change — it translated into a whopping $55 million.

In a vacuum, these figures may seem unimportant. But in context, they are astounding. All of a sudden, Silicon Valley has surpassed many traditional political powerhouses as a source of campaign cash. Specifically, in the last election cycle, technology firms delivered more money to candidates for president and Congress than defense contractors, pharmaceutical manufacturers, the automotive industry and Hollywood.

“Silicon Valley woke up to the importance of influencing public policy,” said Stanford University’s Vivek Wadhwa.

In 2012, that influence was on display when Internet firms notched an unexpected victory over the Hollywood studios that were pushing legislation to hold Internet companies responsible for the illegal transmission of pirated movies and television shows. Despite the so-called Stop Online Piracy Act being backed by the powerful Motion Picture Association of America, the bill was defeated by tech firms’ furious lobbying campaign against the measure.

Of Silicon Valley’s ability to defeat Hollywood-backed legislation, MPAA chairman Chris Dodd said at the time: “It’s a watershed event, what happened.”

Of course, as Wadhwa notes, there is no single Silicon Valley public policy agenda. Tech firms, he asserts want “freedom from regulation and immigration,” but, he says, “there is no single ideology.”

That said, technology firms have forged a unified front on some hot-button issues, moving beyond immigration reform, corporate regulation and the online piracy bill.

In 2013, Silicon Valley giants such as Facebook, Apple, Google, and Mozilla pressed for limits on National Security Agency surveillance after disclosures by whistleblower Edward Snowden. A few years later, Congress reformed the Patriot Act to add restrictions on such surveillance.

Similarly, in March of this year, Silicon Valley won a victory when the Federal Communications Commission passed so-called “net neutrality” rules designed to prevent cable companies from charging different transmission rates to Internet content providers. Most recently, Apple, Google and Facebook wrote a letter to President Barack Obama declaring their opposition to any efforts to weaken encryption standards.

While the power shift toward Silicon Valley is significant, it should not be altogether surprising. Information technology is becoming ever more integral to American society. And the tech industry’s millionaires and billionaires are ready to take their place as political powerbrokers, in much the same way oil and railroad barons represented new political power more than a century ago.

The implications of that revolution are profound not just for campaign fundraising, but ultimately for a whole new generation of public policy.

David Sirota is a senior writer at the International Business Times and the best-selling author of the books Hostile Takeover, The Uprising, and Back to Our Future. Email him at ds@davidsirota.com, follow him on Twitter @davidsirota or visit his website at www.davidsirota.com.

Photo: Patrick Nouhailler via Flickr

Democrats Embrace ‘Citizens United’ In Defense Of Clinton

Democrats Embrace ‘Citizens United’ In Defense Of Clinton

Less than three weeks into her presidential campaign, Hillary Clinton has already accomplished a stunning feat: She appears to have unified large swaths of the Democratic Party and its activist base to support the core tenets of the Citizens United decision — the one that effectively allowed unlimited money into politics.

That 2010 Supreme Court ruling declared that, unless there is an explicit quid pro quo, the fact that major campaign donors “may have influence over or access to elected officials does not mean that these officials are corrupt.” The theory is that as long as a donor and a politician do not agree to an overt bribe, everything is A-OK.

When the ruling was handed down, Democrats were outraged, and Hillary Clinton herself has recently suggested she wants it overturned. Yet with revelations that firms with business before Clinton’s State Department donated to her foundation and paid her husband, Clinton’s campaign and rank-and-file Democratic activists are suddenly championing the Citizens United theory.

In campaign statements and talking points — and in activists’ tweets and Facebook comments — the party seems to be collectively saying that without evidence of any explicit quid pro quo, all the Clinton cash is acceptable. Moreover, the inference seems to be that the revelations aren’t even newsworthy because, in the words of Clinton campaign chairman John Podesta, “there’s nothing new” here.

To advocates for limiting the influence of money in politics, this pushback from Democrats is particularly rich (pun intended) coming from a party that spent a decade asserting that Republicans raking in cash from Big Oil and pushing oil-friendly policies was rank corruption. The Democratic defense of their presumptive presidential nominee registers as especially disturbing to campaign finance reform advocates considering the mighty efficiency of the Clinton fundraising machine.

Consider a few undisputed facts that we surfaced in our reporting at the International Business Times:

  • While Hillary Clinton was Secretary of State, Bill Clinton was paid $2.5 million by 13 corporations that lobbied the State Department. Ten of the firms paid him in the same three-month reporting period that they were lobbying Hillary Clinton’s agency. Several of them received State Department contracts, worth a total of almost $40 million.
  • Hillary Clinton switched her position to back a controversial U.S.-Colombia free trade agreement as millions of dollars flowed into her foundation from an oil company operating in Colombia, and from that company’s founder. Amid reports of violence against Colombian unionists, she also certified Colombia’s human rights record, thereby releasing U.S. aid to the Colombian military.
  • Hillary Clinton’s State Department delivered contracts and a prestigious human rights award to a technology firm that donated to the Clinton Foundation — despite allegations from human rights groups that the firm sold technology to the Chinese government that helped the regime commit human rights violations.

The same Democratic Party that slammed the Bush-Halliburton relationship now suggests that this type of behavior is fine and dandy, as long as there wasn’t, say, an email detailing an explicit cash-for-policy trade. The insinuation also seems to be that journalists shouldn’t even be reporting on any of it, if there is no such email.

Is it morally acceptable for firms to pay a public official’s spouse while those firms are getting government contracts from the agency headed by that same public official? That’s a matter of opinion, and if the Democrats want to now champion the ideology behind Citizens United, that’s their right.

What is not up for debate, though, is whether the transactions are significant and newsworthy absent some sort of explicit quid pro quo. Even if there isn’t an email explicitly sketching out an exchange of money for policy, campaign finance reform advocates are taking notice and the public needs to know the details of these transactions.

After all, if money is going to so thoroughly dominate politics, Americans at least should be informed about who is paying whom when they cast their vote for president.

David Sirota is a senior editor for investigations at the International Business Times and the best-selling author of the books Hostile Takeover, The Uprising, and Back to Our Future. Email him at ds@davidsirota.com, follow him on Twitter @davidsirota or visit his website at www.davidsirota.com. 

Image: DonkeyHotey via Flickr

Will Ted Cruz Super PACs Usher In New Frontier Of Donor Influence?

Will Ted Cruz Super PACs Usher In New Frontier Of Donor Influence?

By Julie Bykowicz and Heidi Przybyla, Bloomberg News (TNS)

The four super PACs preparing to give a $31 million boost to the presidential hopes of Texas Sen. Ted Cruz represent the latest twist in the infiltration of big money in politics — and a way for wealthy donors to have an even more direct say in how their money is spent.

One of the constellation of committees first reported Wednesday by Bloomberg appears to be underwritten by Republican mega-donor Robert Mercer and his family. Campaign lawyers said the arrangement is unlike anything they’ve ever seen before.

“It’s something to watch,” said Jason Abel of Steptoe & Johnson, who is not involved with the super PACs. Abel and other lawyers speculated that multiple committees, all of which are named some form of “Keep the Promise,” were created to satisfy the whims of individual donors.

“It appears that setting up multiple super PACs would allow maximum flexibility for certain donors to push their issues,” Abel said. The Campaign Legal Center’s Paul Ryan suggested that the arrangement creates “different pots of money for donors to fund different things.”

A strategist involved with the committees, who asked not to be named because he’s not authorized to speak publicly, corroborated those theories. Each of the super PACs — Keep the Promise and three “sub-super PACs” dubbed Keep the Promise I, Keep the Promise II and Keep the Promise III — will be controlled by a different donor family, and will likely develop different specialities, such as data mining, television advertising and polling, the strategist said.

In statement Wednesday, Dathan Voelter, a Cruz friend who is serving as treasurer for three of the committees, said donors would not be revealed until July, when the committees are required to file with the Federal Election Commission. But a source connected to the Mercer family told Bloomberg that Mercer and his daughter, Rebekah, are the monied force behind Keep the Promise I. The National Review also reported the Mercers’ involvement. While an aide to Mercer, the co-chief executive officer of Renaissance Technologies, declined to comment, there are strong indications that the money trail leads back to the wealthy and ardently Republican family.

Keep the Promise I, at the donors’ request, uses a different accounting firm than the other three. That firm is based in Port Jefferson Station on Long Island, N.Y., two miles from East Setauket, where Mercer lives.

Hours after Cruz announced his presidential bid last month, he and his wife, Heidi, courted donors at Rebekah Mercer’s Manhattan apartment, according to the New York Post. Rebekah Mercer, who owned a Manhattan pastry shop with her sisters, has a fondness for Cruz: Since 2012, she has given him more than $28,000. In 2012, the year Cruz was first elected to the Senate, Federal Election Commission records show that she wrote a $15,000 check to Club for Growth, one of the biggest spenders in the race.

Rebekah Mercer’s father’s involvement means Cruz has tapped the vein of the upper echelons of Republican benefactors. The reclusive Robert Mercer was the fourth-most generous donor to outside groups in the 2014 elections, spending $9.2 million on conservative causes and candidates, according to the Center for Responsive Politics.

At the other end of the spectrum, Cruz has been heralding his small-dollar online support. Last week, he boasted to Iowa Republicans that he’d raised $4 million in the eight days since announcing his presidential campaign, 95 percent of which, he said, was in the form of $100-or-less donations.

The idea for the Keep the Promise PACs came together quickly — all of the super PACs filed paperwork with the FEC in the past several days. None of the PACs have held fundraisers, the unnamed strategist for the group said, adding that it will be up to the founding donors as to whether they want to raise money from anyone else.

The Keep the Promise enterprise appears to represent an entirely new level of donor involvement in campaign finance, with donors now directly calling the shots on how their money is to be spent and organizing with each other as never before.

The Citizens United decision by the Supreme Court in 2010, and subsequent court rulings and federal regulations, opened a pathway for multimillion dollar donations from individuals, companies and unions to flow into politics. In the 2012 presidential election, President Barack Obama, Republican nominee Mitt Romney and others embraced super PACs, appearing at a handful of their fundraisers.

More recently, some donors have begun not just writing big checks, but starting their own super-PACs. John Jordan, a California winery owner, spent about $1.5 million on his own super PAC in 2013 to help Republican Massachusetts Senate candidate and fellow Naval officer Gabriel Gomez. Democrat Ed Markey prevailed.

Jordan, who is not involved in any 2016 fundraising efforts, predicted that the Cruz committees mark the beginning of a trend. “It’s more fun to play kingmaker than to give your money to some consultant and let them take all the credit,” he said in an interview Wednesday. “This is an upending of traditional roles in Republican politics. Donors used to be in the category of ‘write a check and go away’ while the operatives called all of the shots. Donors don’t want to play second fiddle anymore.”

(c)2015 Bloomberg News, Distributed by Tribune Content Agency, LLC

Photo: U.S. Sen. Ted Cruz (R-Texas) speaks at the 42nd annual Conservative Political Action Conference (CPAC) on Thursday, Feb. 26, 2015, in National Harbor, Md. Cruz announced his presidential bid Monday. (Olivier Douliery/Abaca Press/TNS)