Old-Fashioned Scandal in the Era of Dark Money and the Trump International Hotel

If Sen. Robert Menendez is convicted, it could mean the end of Obamacare. But the case also reveals the subtle layers of what constitutes modern-day corruption.

September 9, 2017
Robert Menendez

Cross-posted on The Daily Beast

“Corruption Trial in New Jersey.” Not exactly earthshaking news. Perhaps not up there with the legendary “Worthwhile Canadian Initiative,” but close. So readers will be forgiven for not paying attention to the ongoing trial of Sen. Robert Menendez, charged with bribery and other alleged misdeeds in federal court in Newark.

In fact, the last time a sitting U.S. Senator was convicted for bribery was in 1981: Harrison Williams of, yes, New Jersey. That was the Abscam case, in which FBI agents dressed up as Arab sheiks, the sting dramatized inAmerican Hustle. The Senate eventually expelled Williams.

A Menendez verdict is expected sometime in October. The result will matter, of course, because it affects the Senate’s partisan balance and thus the fate of Obamacare, among other things. The governor of New Jersey appoints the successor if a Senate seat becomes open. Until Jan. 1, Republican Chris Christie would make the pick. But Christie is leaving office, and there’s an election this fall. In the new year, odds are the new governor will be Democrat Phil Murphy.

If Menendez is convicted, we can expect a partisan brawl over what happens next. Republicans will righteously demand a quick resignation so Christie gets to choose. Democrats will furrow their brows, murmur about due process, wait for Menendez to appeal, and watch the clock. Under the Constitution, it takes 67 votes to expel a senator (meaning 16 Democrats would have to agree). The disgraced Sen. Williams held on to his seat for nearly a year. So a new appointment is not likely to happen before New Year’s Day.

At stake is a lot more than red versus blue bragging rights. One senator’s vote saved the Affordable Care Act. If a fresh-scrubbed Republican unexpectedly shows up in town, it could mean that Obamacare repeal and replace suddenly has a majority. That would be a political cliffhanger worthy of House of Cards.

But in some ways the drama obscures what has already been revealed. The Menendez scandal shines a harsh and grimy light on the ways corruption is evolving in the era that combines Donald Trump’s gilded excesses and the new world of dark money.

Menendez was elected in 2006. Almost immediately, according to prosecutors, he became the eager recipient of gifts, favors, and significant campaign contributions from a physician, Dr. Salomon Melgen. Menendez took 19 free rides on Melgen’s private planes, stayed at luxury resorts around the world, and saw over $600,000 flow from Melgen’s bank account into Super PACs that helped get him re-elected. In exchange, he allegedly helped three of Melgen’s foreign-born girlfriends get visas, tried to help the doctor get out of a multimillion-dollar Medicare payment dispute, and even asked then-Senate Majority Leader Harry M. Reid (D-NV) to step in.

A grand jury first indicted Menendez two full years ago. Now that a jury has finally been seated, the courtroom drama has been less than edifying. On alternate days the judge yells first at the defense lawyers and the prosecutors. It could drag on for a month.

The charges themselves evoke a quaint bygone era. Long ago, political corruption routinely involved bribes paid, pockets lined, kickbacks for overpriced cement. Politicians mysteriously became wealthy without ever leaving the public payroll. As George Washington Plunkitt of New York’s Tammany Hall political machine famously said over a century ago, “I seen my opportunities and I took ’em.” Plunkitt proudly called the system “honest graft.”

In the modern campaign finance era, corruption grew more subtle. Lawmakers themselves were less personally corrupt. Influence flowed instead from campaign contributions and other funds for political activities. The risk of misconduct can be just as great, but indirect influence is harder to prove. Actual bribes? Now that’s downright artisanal corruption.

It’s also one of the first big corruption trials after a 2015 U.S. Supreme Court ruling that overturned the conviction of Virginia Gov. Bob McDonnell. His corruption was just as venal as Menendez’s, if a bit more picturesque: He let a supplicant pay for his daughter’s wedding reception, all in exchange for helping promote a dietary supplement. The Court held that was not an “official action” (PDF). The justices narrowed prosecutors’ ability to bring charges against sleazy officeholders. (For example, former New York State assembly speaker Sheldon Silver now must be retried.) Many worried that corruption cases would be hamstrung. Thus far, though, the high court ruling seems to have had little impact on the Menendez case, given the plainly public acts alleged.

But if the corruption has a retro feel, in another way it’s all too modern. The Supreme Court also ruled in Citizens United there can be no corrupting impact from a campaign gift if it is given to an independent committee. Reformers have responded that elected officials can be swayed by a gift to a Super PAC just as surely to a direct campaign account. One of the charges here makes that point directly: Menendez’s benefactor ladled funds to PACs, not to the senator directly. It turns out you can have corruption even without grainy videotapes of money changing hands.

Menendez’s trial is an early omen of what the corruption will look like in the era of dark money and effectively unlimited spending by the Koch brothers, the Mercer family, and others whose names we don’t even know yet—but the politicians undoubtedly do.

If he’s guilty, he will be punished. If he’s found innocent, no doubt there are lobbyists who would toast him at the Trump International Hotel two blocks from the White House.

That’s where subtle 20th century notions of corruption are being overwhelmed in the riot of self-dealing now unfolding in the capital. As has been widely documented, the hotel is jammed with foreign governments wishing to curry favor, lobbying groups gathering, politicians raising money, hangers-on wishing to see and be seen—and cabinet secretaries and presidential family members preening for selfies. It’s a scene that would make the boodlers and “honest graft” artists of an earlier era feel right at home.

Trump claimed to be an unconventional candidate in 2016, raising less than most and insisting he could not be bought. Now he is enthusiastically enmeshed in a political system driven by deregulated campaign fundraising. Thanks to misguided court rulings and near-defunct enforcement agencies, voters will have less ability than ever to know who is paying and what they are getting.

A stray prosecution of a senator here and a mayor there is hardly the answer to what ails American politics. By all means, when politicians are convicted of crimes, throw the book at them. But then let’s look around at the everyday rot that is eroding our institutions. The fate of Obamacare may be at stake—but the state of our democracy most surely is.