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Money in Politics This Week: Six Mind-Blowing Statistics About the 1 Percent of the 1 Percent

A roundup with the latest news highlighting the corrosive nature of money in New York State politics — and the need for public financing and robust campaign finance reform.

  • Syed Zaidi
June 28, 2013

Crossposted at 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 Syed Zaidi.

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


Poughkeepsie Journal Laments Senate Action on Public Financing

During this legislative session, four state lawmakers faced new corruption charges, while another, Assemblymen Vito Lopez (D-Brooklyn) resigned due to allegations of sexual harassment. Two more state legislators were revealed to be wearing wires for federal investigators. On Tuesday, the Poughkeepsie Journal lamented the Senate’s inaction on addressing corruption. According to the editorial, state officials had plenty of options. Foremost among these was reforming the state’s porous campaign finance laws. “More light must be shed on any outside business dealings of elected officials as well as any use of campaign money for personal purposes.” The newspaper also touted proper enforcement and reporting requirements as important steps to take. Unfortunately, as Assemblyman Bill Nojay (R-Pittsford/Monroe County) put it, the “2013 session is [now] going to be remembered for corruption, investigations, pay to play, sexual harassment and cover-ups.”

NYS Attorney General Schneiderman Describes New Regulations on Outside Spending

The New York State Attorney General Eric Schneiderman had a great column in the Albany Times-Union addressing the role of dark money in our elections. The current scandal embroiling the Internal Revenue Service involving the targeting of conservative-leaning groups is the product of unclear regulations on political contributions. After the Supreme Court struck down restrictions on outside spending in elections with the Citizens United decision the IRS issued regulations that created confusion for the IRS staff. The Internal Revenue Code requires 501(c)(4) non-profits to operate “exclusively” for the promotion of social welfare. The IRS, however, issued regulations that misinterpreted “exclusively” to mean “primarily,” an unclear standard. Consequently IRS staff potentially carried out discriminatory word searches and intrusive requests for detailed information from groups seeking to identify if these “non-profits” were indeed social welfare organizations. Simply following the Tax Code by requiring 501(c)(4)s to operate solely for social welfare purposes would remedy this problem. In the mean time, given the regulatory gap, state attorney generals can take action. Many states are empowered to regulate charities and non-profits operating in the state. Attorney General Scheniderman has already announced new regulations requiring 501(c)(4) organizations that spend more than $10,000 on state and local elections to disclose their donations and expenditures. “While we cannot control spending in federal campaigns we can, for example, ensure that New Yorkers will know who is paying for attack ads in this year’s mayoral campaign and next year’s race for governor.”

Sierra Club Contends Lawmaking Influenced by Political Donors

In the Buffalo News, Pamela Hughes, vice chairman of the Sierra Club Niagara Group, and Sara Schultz, the group’s secretary, write that our elected officials should be held responsible to their constituents not their corporate donors. “In Albany, if you want to figure out how a legislator will vote, the best place to look isn’t at what their constituents believe, but at what their campaign donors want.” In 2012, pro-fracking interests dumped $400,000 in the campaign coffers of Southern Tier politicians. Subsequently a bill to protect New Yorkers from toxic fracking waste was stopped by the same state senators whose campaign chests were expanding. Worse, year after year politicians have side-stepped important reforms that would reduce the influence of money in our elections. Publicly financing our elections by matching small donations from in-district residents is a good remedy to the disproportionate influence of wealthy corporations over our legislative process. New Yorkers must ask themselves whether they want our politicians to answer to taxpayers or campaign donors.

Rochester Democrat and Chronicle Editorial Criticizes Self-Praise by Lawmakers

Despite self-praise by lawmakers for this year’s legislative session, major regional newspapers have been highly critical of their job performance. The Rochester Democrat and Chronicle remarked that “despite more sex scandals and the indictment of lawmakers on bribery charges, there was no meaningful legislation that pushed back against Albany’s culture of corruption.” The legislature failed to pass any anti-corruption proposals. Campaign finance reform is an idea that is supported by a vast majority of New Yorkers and even a majority of legislators. However, election reform went nowhere; the Senate leadership refused to bring it up for a vote. Ultimately until “New Yorkers can trust their government and its leaders, it’s hard to believe that real progress toward Cuomo’s new New York is being made.”

Buffalo News Editorial: Accountability Still Missing From Electoral Process

The Buffalo News was also disappointed in Albany’s inability to meet the needs of constituents. Nefarious activities by legislators were too frequent in Albany. Accountability has been missing from our election and policy process for quite some time. Public financing of elections is a necessary remedy. It would open more incumbents to the threat of challenge. The refusal by Senators Dean Skelos and Jeffrey to address basic concerns about trust in our representatives Klein is truly appalling. The Buffalo News calls for Albany to get “serious about official malfeasance.”



Sunlight Foundation: Shocking Facts About the 1 Percent of the 1 Percent

The Sunlight Foundation has come out with a shocking analysis of campaign contributions during the 2012 election cycle. Entitled the Political 1% of the 1%, the report notes that 28 percent of all disclosed political contributions came from just 31,385 people in the U.S., out of more than 300 million citizens. No member of the House or Senate elected last year won without financial assistance from these individuals. And 84 percent of those elected in 2012 took more money from the top 1 percent of the 1 percent of donors than they did from all of their small donors (individuals who gave $200 or less) combined. For a quick summary, Mother Jones does a great job of boiling down six of the most noteworthy takeaways from this study. This tiny moneyed elite donated $1.62 billion in the 2012 election cycle, including $500.4 million to Super PACs and $670.5 million to political parties. This total does not even count the nearly $305 million that was funneled by donors that remain unknown. The median contribution from the 1 percent of the 1 percent was $26,584 – a little more than half the median annual family income in the country.

Seattle City Council Passes Measure for Residents to Vote on Public Financing

On Monday, the Seattle City Council passed a bill allowing voters the option to approve a measure for publicly funded local elections come November. To qualify, candidates will have to collect contributions of $10 or more from at least 600 Seattle residents. Donations up to $50 would be matched at a six-to-one ratio but only for the first $35,000 raised. Candidates who choose to participate voluntarily may receive up to $210,000 in public funds for the primary and general election. To fund the program, a tax levy, which still needs approval from residents, would collect about $5.76 per year for a home valued at $350,000. Former Mayor Norm Rice, who won both City Council races and the Mayor’s race when a different local public financing regime was in place – before a state initiative prohibited the practice – praised the system, stating that “everybody’s dollars really counted, not just rich ones.”

U.S. Court of Appeals for the Tenth Circuit Upholds District Court Decision in Free Speech v. FEC

On Tuesday, the U.S. Court of Appeals for the Tenth Circuit upheld an earlier ruling by the U.S. District Court for the District of Wyoming in Free Speech v. FEC. Free Speech is a Wyoming-based, 501(c)(4) tax-exempt organization with the goal of promoting and protecting “free speech, limited government, and constitutional accountability.” Free Speech challenged the constitutionality of the FEC’s regulations concerning federal disclosure laws that require non-profit “social welfare” organizations to disclose their expenditures and the sources of their donations. The trial court had upheld the rules regulating nonprofits’ outside spending, and the appeals court affirmed the decision. Tara Malloy, senior counsel at the Campaign Legal Center, which submitted in amici brief in the case, stated that “This suit, like a flurry of similar suits nationwide, asked the court to ignore precedent and reject the public’s right to know who or what group is spending large amounts of money to determine the winners and losers on Election Day.”