Money and Politics This Week

Crossposted on ReformNY.

Every Friday, the Brennan Center will be compiling the latest news concerning the corrosive nature of money in New York State politics — and the ongoing need for public financing and robust campaign finance reform. We’ll also be linking to dispatches from around the country highlighting the national scope of this crisis. This week’s links were contributed by Matthew Ladd and Dan Rockoff.

For more stories on an ongoing basis, follow the Twitter hashtag #moNeYpolitics

NY Campaign Finance

1. A new report issued by NYPIRG identifies a “core group” of 127 donors who each gave $50,000 or more to state candidates and party committees in 2011, for a grand total of $16.8 million. Of the 127 deep-pocketed donors, the largest — a New York City property development group — contributed nearly $700,000 in total, and several organizations made single contributions in excess of $100,000. The report highlights New York’s chronically lax laws governing “housekeeping” and soft money accounts, which allows individual donors to skirt the $150,000 ceiling on individual giving. The full report can be seen here.

2. A coalition of more than 100 organizations, including policy institutes, community groups, and labor and religious organizations, delivered a letter to Gov. Cuomo expressing their strong support for public financing in New York state elections, and calling on the governor to “press hard for the creation of a robust public financing program” during the upcoming year.

3. The Wall Street Journal finds that Gov. Cuomo has built strong relationships with public interest groups committed to campaign finance, ethics, and disclosure reform, citing his hiring of Jeremy Creelan, a former deputy director at the Brennan Center, as special counsel for public integrity and ethics issues. The liaison was instrumental in the governor’s overhaul of state ethics laws last year, and reformers hope it will continue to bear fruit in upcoming legislative campaigns.

4. State Senator Liz Krueger is publicly calling for an end to political spending by “ghost campaigns,” which allow Albany’s lawmakers to spend campaign funds long after they’ve retired from office — and, in at least one case, after they’ve passed away. The article highlights continued spending by the campaign committees of former Rep. Eric Massa, who resigned in 2010, as well as the re-election committee of former State Sen. Ron Stafford, who passed away in 2005. “Politicians shouldn’t be able to keep hundreds of thousands of dollars of campaign money hoarded years after their own careers end,” Sen. Krueger said. “It’s an invitation to corruption.”

5. US Congressman Joe Crowley (D–NY) was singled out this week as a top Democratic beneficiary of a private equity PAC with a history of spending on behalf of Republicans. The PAC, formed in 2007 by some of the country’s biggest private equity firms, has drawn unwelcome media attention since it emerged that Bain Capital, where Mitt Romney made his fortune, was one of its founding members.

6. Pay-to-play politics is alive and well in New York, as the Daily News reports that freshman US Congressman Michael Grimm (R–NY), seven months after sponsoring a bill to permit a natural gas pipeline under Jacob Riis Park in Queens, has received contributions from the pipeline’s developers. Two weeks ago, the New York Times also reported that Rep. Grimm was drawing scrutiny for allegedly soliciting campaign donations above the legal limit, and for enlisting the help of a fundraiser now under federal investigation for embezzlement.

Campaign Finance News Nationwide

1. On Tuesday, President Obama signaled that he would not oppose spending on his campaign’s behalf by Priorities USA Action, the super PAC that backs his re-election bid. Aides to the President confirmed that he planned to allow cabinet members, senior advisors and top campaign staff to speak at fundraising events led by Priorities USA. The decision was condemned by many as an about-face by an administration that has criticized the use of super PACs — but has also prompted at least one writer to observe that the decision presents a unique opportunity for Obama to make campaign finance reform a centerpiece of his election campaign.

2. Media mogul and philanthropist Leo Hindery, Jr., argues for a strong link between campaign finance reform and renewed corporate responsibility, proposing that national reform efforts should include not only stronger disclosure rules for corporate contributions and lobbyists, but also voluntary efforts by business leaders not to use corporate funds to influence elections. Such an approach, Hindery writes, would help to reclaim corporate responsibility as a duty extending to “employees, shareholders, customers, communities and the nation.

3. A new poll released Wednesday by Greenberg Quinlan Rosner finds strong support — by a 2-to-1 margin — for the Fair Elections Now Act, which would allow federal candidates who agree to contribution limits to receive public matching funds for donations from residents of their home states. The poll also finds that voters would be more likely to re-elect representatives who voted in favor of a campaign finance reform package that included the Fair Elections Now Act.

4. Politico reports that two PACs have used shell corporations to circumvent existing laws on fundraising and spending, making campaign committees into “black boxes” for anonymous contributions. According to the report, the Alliance for New America, which raised money for John Edwards in 2008 and now plays a supporting role in his trial, created an LLC through which it funneled much of its spending, while Restore Our Future, the super PAC supporting Mitt Romney, accepted donations through shell corporations, allowing the names of donors to remain hidden.

5. Two recent reports highlight the corrosive potential of so-called “c4s” (after their 501(c)4 tax code designation), the “social welfare” arms of super PACs, to raise and spend money without disclosing their donors to the FEC. Based on their IRS filings, such groups have begun to play a bigger role in direct independent spending than supporters of campaign finance reform had expected, and their ability to filter money from contributors to their associated super PACs means that some super PAC spending is virtually untraceable. A report recently issued by Demos and the US PIRG Education Fund found that out of 10 super PACs active in the 2012 elections, 6 had received money from untraceable sources.