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Monday, December 09, 2019

Clinton’s Ties To Corning Turn Republican Stronghold Into Cash Cow

By Zachary Mider, Bloomberg News (TNS)

NEW YORK — Republicans outnumber Democrats two to one in rural Steuben County, N.Y., the home of the glassmaker-turned-tech-company Corning Inc. The company’s leaders have been enmeshed in Republican politics ever since they backed James Garfield for president in 1880. Two different sons of the founding Houghton family have gone to Congress on the GOP ticket after running the company.

But in July, the current CEO, a registered Republican named Wendell Weeks, gathered some 150 friends and employees in a hotel ballroom in the tiny company town of Corning to welcome the firm’s clear favorite for president of the United States: Hillary Clinton.

Clinton’s relationship with Corning, a major employer in upstate New York, dates to when she served as the state’s junior U.S. senator, but they seem only to have strengthened since she left that role almost seven years ago. Over 100 Corning employees have given her campaign a combined $196,700 so far this year, her second-biggest source of contributions by any employer, and ahead of the Wall Street investment banks and Washington lobbying firms that usually give the most in presidential contests. Only three employees gave to other candidates.

Her ability to sustain her ties to Corning points to one of the strengths of her campaign for the presidency: a Rolodex built over decades in public life and painstakingly maintained, offering her a formidable list of allies and more campaign contributions — $77 million — than anyone in either party in the 2016 race. (Jeb Bush is ahead only if independent super PAC funds are included.)

It also points to a potential weakness: She’s been criticized for blurring lines between her official duties, fundraising and personal finances, such as with the corporations that have bankrolled her family foundation and supported her and her husband’s lucrative speaking business.

Corning has done both, but James Flaws, the chief financial officer and a co-host of the July fundraiser, said the company doesn’t stand to gain more than anyone else if she becomes president. “We’re voting for someone who we think is an effective leader for the country,” he said.

The Clinton campaign didn’t respond to a request for comment.

In interviews, some of Clinton’s advocates at the company and in the region said they didn’t expect special attention of the kind they enjoyed when she was in the Senate, nor could they point to any of her campaign pledges that would particularly benefit them. They said they just got to know her when she was their senator, and thought she did a good job. They recalled times when she remembered a name, found money to fix a road, or cut short a nap on the campaign trail to meet with a local official.

“She’s been a friend to us in Corning, and you support your friends,” said Thomas Blumer, 65, a retired supply-chain executive at the company and a lifelong Republican who contributed $2,000.

Amory Houghton Jr., 89, is a scion of the company’s founding family who served as company chairman through the 1980s, and later as a Republican congressman. After his wife died in 2012, he recalls getting a call from Clinton, who was serving as secretary of state at the time.

“She was in Uzbekistan or something like that. She called up and said how sorry she was,” he said. “You could say that was political. I don’t think it was. I thought it was wonderful. Those human touches really made a tremendous difference here.”

One sunny spring day in 2003, Clinton stood outside Corning’s headquarters in a bright orange pants suit, gazing at the back end of an idling school bus. She was there for a demonstration of a ceramic filter the company had invented to reduce diesel pollution. An official held a white cloth over the tailpipe, then handed it, still immaculate, to the senator. She sniffed it. “It’s like a magic trick,” she remarked to a local newspaper, the Star-Gazette. Not long after, Clinton helped direct hundreds of millions of dollars in federal funding to equip buses and trucks across the country with Corning’s technology.

At the time, the 164-year-old company’s shares were near their lowest point in decades, and it needed the help. A firm that crafted some of Thomas Edison’s first light bulbs had, by the end of the 1990s, shifted focused from glassmaking to fiber optics. When the telecommunications boom went bust just after Clinton joined the Senate, Corning nearly went out of business. It recovered by boosting sales of a broader group of products, including the emissions filters, liquid-crystal displays for TV’s and computer screens, and the high-tech glass in smartphones. It now has about 35,000 employees around the world, including about 5,000 in the Corning area, nearly half the population of the town.

Sen. Clinton helped in other ways, such as intervening in a trade dispute with China over fiber-optics tariffs, and upgrading a key highway. The company reciprocated, directing thousands to her Senate re-election campaign from top executives and through its political action committee.

The support continued after Clinton left the Senate for the State Department in 2009. When she sought to raise $60 million in corporate funding to pay for an American pavilion at a world expo in China the following year, Corning kicked in $500,000. Corning also cut a check of at least $100,000 to her family’s foundation, and paid her $225,000 last year to give a speech to about 200 top executives.

Corning spokesman Daniel Collins said the company’s contribution to the Clinton’s foundation was to support an initiative to promote the advancement of women into senior corporate positions. As for the expo in China, he noted that the company employs more than 5,000 people in the country and an additional 10,000 in the Asia-Pacific region.

Clinton continued to be helpful to the company while at the State Department, according to Blumer, the former supply-chain executive. “If we needed to know who to deal with somewhere around the world, she could help with names,” he said.

Flaws, the CFO, said he scrawled personalized notes to so many hundreds of his friends and colleagues, asking them to come to the $1,000-a-seat July fundraiser, that his hand got sore. As he remarked to the Star-Gazette in 2003, “The Clinton-Corning partnership is very rewarding for both of us.”

Photo: The company that makes intricate and beautiful glassware, Corning, has donated plenty of money to Hillary Clinton’s campaign. Brian Holland/Flickr

Another Way To Mask Super Rich Donors

By Zachary Mider, Bloomberg News (TNS)

WASHINGTON — In January, Ted Cruz’s quest for the presidency got help from a limited liability company called V3 231. The LLC was listed as the source of a $250,000 donation to a super PAC supporting the conservative Republican senator from Texas. For anyone wondering what V3 231 is, or who controls it, there were few clues. A lawsuit filed in federal court mentions the company once owned a hotel in Brooklyn, N.Y. A search on the Internet reveals the name of the hotel’s now defunct developer. One of the developer’s former executives, reached on his mobile phone, says another man controls the LLC. That guy’s name, the former executive says, is Ben Nash.

Nash was a 17-year-old yeshiva student from Brooklyn when he discovered a knack for selling cellphones. He dropped out of school and eventually made a fortune reselling used or surplus phones. His company, PCS Wireless, is targeting $1 billion in sales this year, according to Business Insider. Now 32, Nash has grown wealthy enough to dabble in Brooklyn real estate and philanthropy. He picks up the phone right away when reached at his headquarters in suburban New Jersey. He allows that he had dinner with Cruz a few months back, but he says he doesn’t think he gave the candidate as much as $250,000. “We give to a lot of charity over here,” he says. He ends the call promising to investigate. “I do want to check, for my own personal interest.”

The next day, Nash’s spokesman, Robert Barletta, confirms that Nash was behind the $250,000 donation. In an email, Barletta calls the donation “transparent and fully within federal campaign finance laws” and motivated by Cruz’s support for Israel.

When the Supreme Court ruled in 2010 to end a ban on corporate spending to influence elections, detractors envisioned an era when huge companies like Wal-Mart Stores or ExxonMobil would dominate politics in pursuit of profits. The reality is proving far different. Most business donations are coming from little-known LLCs whose founders and officers often don’t have to be disclosed anywhere. In a few cases, it’s so difficult to identify the source that the donations might as well be anonymous.

That alarms groups worried about the influence of money in politics. “When we’re talking about these huge contributions, it’s a way to buy corrupting influence without any public accountability at all,” says Fred Wertheimer of Democracy 21, a Washington nonprofit.

Since 2012, Democracy 21 and the Campaign Legal Center have filed four complaints with the Federal Election Commission challenging big donations through LLCs. The commission is deadlocked along party lines and has yet to take any action.

Some lawyers say closing the LLC loophole would require legislation. “I would advise a donor that you have every right to do everything you want with your money,” says Dan Backer of DB Capitol Strategies in Alexandria, Va. “If that LLC chooses to make a contribution, that is the right of that LLC.”

Donors seeking anonymity can also give to nonprofit advocacy groups — known as 501(c)4s, after the section of the tax code that defines them — which don’t have to disclose the source of their funding at all. But, unlike super PACs, these groups aren’t supposed to spend all their money influencing elections.

The biggest LLC donation of the presidential race has been a $1 million check to Right to Rise, a super PAC aligned with Jeb Bush, from Jasper Reserves. A Florida billionaire named Christopher Cline identified himself to Bloomberg as the source of the money. Cline is a coal baron whose 164-foot yacht, Mine Games, has its own two-person submarine.

Then there’s MMWP12, one of the biggest donors to an independent advocacy group supporting John Kasich’s presidential run. In early August, the Center for Public Integrity traced the LLC’s $500,000 donation to Mark Kvamme, a venture capitalist and off-road-truck enthusiast who used to work in the Ohio governor’s administration. Reached by phone, Kvamme is happy to share his opinion of Kasich. “I worked for the guy,” he says. “I saw him do what he did in Ohio. The guy is spectacular.” But Kvamme won’t talk about any connection to MMWP12. “Let them report whatever they want to report,” he says. “I’m not confirming or denying. It is what it is.”

Photo: Light Brigading via Flickr

Hillary Clinton Emails Show A Friendly Face To Wall Street

By Zachary Mider, Bloomberg News (TNS)

Hillary Clinton tried to help one private-equity boss with a visa problem and encouraged another on a project in China. She apologized to the chairman of a big corporation for failing to commit to an event right away.

“So sorry I haven’t responded before but I’ve been hip deep in the rollout of the Afghanistan strategy,” Clinton wrote to Terrence Duffy, executive chairman of futures market operator CME Group and a supporter of her 2008 presidential campaign. “I hope you, your family, and the futures markets are all well!”

The 3,000 pages of emails that the State Department released this week, dating from Clinton’s time as secretary of state, show another side of Clinton from the one that was on display last month in New York.

There, the Democrat kicked off her campaign for the presidency with a swipe against overpaid CEOs and hedge-fund managers, saying “democracy can’t just be for billionaires and corporations.” She also said the nation’s 25 highest-paid hedge-fund managers make more than all of American kindergarten teachers combined.

The emails, which mostly date from 2009, Clinton’s first year running the State Department, show more willingness to work with big business and financiers, perhaps not surprising given that, in her previous job as a senator from New York, Clinton represented Wall Street and had financial firms among her top campaign donors, according to data compiled by the nonpartisan Center for Responsive Politics.

Even Stephen Schwarzman, the billionaire leveraged-buyout CEO who was a key fundraiser for George W. Bush, got a favor. After an event at the New York Stock Exchange in 2009, where she rang the opening bell, she emailed her staff to follow up on Schwarzman’s request for help with a visa for a person whose name is redacted in the State Department release.

The Blackstone Group chairman is an outspoken defender of the preferential tax treatment that applies to some private-equity managers’ pay known as carried interest, once likening a proposal to end it to Hitler’s invasion of Poland. (He later apologized for that analogy.) Clinton is among those who have called for the carried interest treatment to be changed.

Still, Blackstone has given at least $250,000 to the Clinton Foundation and related charities over the years. And although Schwarzman gives mostly to Republicans, according to Sunlight Foundation data, he gave $500 to Bill Clinton’s presidential campaign in 1992. (On Wednesday, Clinton reported raising a record-breaking $45 million for the first quarter of her presidential campaign. Names of donors won’t be revealed until later this month.)

Another private-equity executive who appears in the emails is Admiral William Owens, who was appointed vice chairman of the Joint Chiefs of Staff by Bill Clinton. By 2009, he was a top executive in the Asian arm of AEA Investors, a private-equity firm founded by the Rockefeller, Mellon and Harriman family interests. He was working on a project to encourage dialogue between retired senior military leaders in the United States and China, and wanted Clinton to attend some meetings.

“Thanks for continuing this important project which I heartily support,” Clinton replied. It’s not clear from the emails if she took him up on his request.

Clinton had warm exchanges with Stephen Roach, a Morgan Stanley economist, and passed along a concern about a trade issue voiced by David Cote, the chief executive officer of Honeywell International.

Another pen pal was CME’s Duffy, who made $6.7 million last year, and whose endorsement in her 2008 run came despite his being a registered Republican.

“We need a president like Hillary Clinton who understands the important role that financial markets play in our global economy,” he said in a statement then.

Clinton knows more than a little about the futures markets in particular. Her series of well-timed trades in cattle futures became a topic of controversy during her husband’s first term in the White House.

Duffy kept in touch after the 2008 campaign. “You’re doing an incredible job,” he wrote in May 2009, asking for her presence at a company event. “Once again,” he said in September, inviting her to another event, “you’re doing an amazing job.”

“I am trying hard to accept this invite,” she replied, “We will let you know one way or the other by the end of the week. Is that OK?”

It was OK with Terrence Duffy.

Photo: U.S. Embassy via Flickr