Monday, February 11, 2013

Life Begins at Incorporation

Legislation for the public financing of presidential candidates in the U.S. was first proposed in 1907. In his State of the Union Address that year, President Theodore Roosevelt recommended public financing of federal elections and a ban on private contributions.

The Federal Election Campaign Act of 1971 increased disclosure of contributions for federal campaigns. It was amended in 1974 to place legal limits on campaign contributions. The amendment also created the Federal Election Commission (FEC). It was amended in 1979 to allow parties to spend unlimited amounts of hard money on activities like increasing voter turnout and registration.

The Federal Election Commission administered the first public funding program in 1976. Eligible Presidential candidates used federal funds in their primary and general election campaigns, and the major parties used public funds to pay for their nominating conventions.

From 1976 through 2004, every major party presidential nominee relied exclusively on public money for the financing of the general election campaign. And from 1976 through 1996, every winner of the major parties’ respective presidential nominations did so with the assistance of public matching funds in the primary elections.

During President Obama's State of the Union Address, soon after the Supreme Court's ruling in January 2010 on Citizens United, the president said the court "reversed a century of law that I believe will open the floodgates for special interests – including foreign corporations – to spend without limit in our elections."

Supreme Court Justice Samuel Alito, sitting with five other justices, was seen to mouth the words, "Not true."

This week Robert Reich wrote about the "rights" of corporations to influence our elections: "The Court's bizarre 2010 decision in Citizens United versus Federal Election Commission -- deeming corporations people under the First Amendment, with unlimited rights to spend money on elections -- didn't consider the question of corporate citizenship as such.

But it's likely to become a big issue in the future as large American companies that pour lots of money into our elections morph into global corporations without any particular national identity.

Most of Chrysler is owned by Fiat, and most of Fiat is owned by non-Americans. Both IBM and GE have more non-American employees and customers than American, and foreign ownership of both continues to increase. At what point do these global entities forfeit their right to influence U.S. elections?"

The total amount spent on the last election cycle, according to an estimate by the non-partisan Center for Responsive Politics, was $6 billion. That's $700 million more than the previous "most expensive election" in history— in 2008—and includes money spent by the campaigns, outside groups, and independent organizations.

The amount of money spent on the presidential race alone was $2.4 billion. The partial breakdown includes:

  • $970 million-The estimated amount spent by outside groups during the 2012 cycle
  • $874.6 million - The amount that went toward Obama's re-election this election cycle
  • $844.6 million - The amount that went toward Romney's candidacy this cycle
  • $265 million - The gap between the amount President Obama and Mitt Romney spent on TV ads
  • $123 million - The amount of "dark money" or anonymous cash spent to influence the elections
  • $78 million - The amount the two campaigns spent on online advertising throughout the race

Comparable numbers can be found at the New York Times

Supreme Court Justice Samuel Alito is defending the court's 2010 decision in the Citizens United case that helped fuel hundreds of millions of dollars of spending by independent groups in the just-concluded 2012 campaign cycle, saying that the First Amendment protects political speech, whether from an individual or a corporation.

But Justice Alito ignores the fact that whoever has the most money, also has the biggest megaphone (and the loudest voice), and they can talk over someone else's right to be heard. Below are just a few examples of those individuals (which also includes their corporations) with really SUPER BIG megaphones. They all gave money to candidates that would primarily reduce their tax taxes, while at the same time, cutting Social Security and Medicare for everybody else.

Sheldon Adelson* and his wife Miriam held the #1 spot among super PAC donors, and they have the biggest megaphone. They gave:

  • $20 million to Restore Our Future (supporting Romney)
  • $15 million to Winning Our Future
  • $5 million to Congressional Leadership Fund
  • $5 million to YG Action Fund
  • $2 million to Freedom PAC
  • $1.5 million to Independence Virginia PAC
  • $1 million to Ending Spending Action Fund,
  • $1 million to Treasure Coast Jobs Coalition
  • $1 million to Patriot Prosperity PAC
  • $250,000 to Conservative Renewal PAC,
  • $250,000 to Texas Conservatives Fund
  • $190,000 to Hispanic Leadership Fund.

Sheldon Adelson has allegedly given in excess of $70 million when contributions to non-profit groups like Americans for Prosperity and the Republican Jewish Coalition are included. His involvement in politics revolves around his support for the state of Israel, in particular the policies of Prime Minister Benjamin Netanyahu. His business, along with that of other super PAC donors, is also under investigation for violations of the Foreign Corrupt Practices Act.

PICTURED BELOW: Sheldon Adelson's influence on elections compared to yours.

After Sheldon Adelson, Harold Simmons, the octogenarian Dallas businessman, was in second place among the super PAC donors. He, with his wife Annette and his company Contran Corp., donated $26,765,000 to super PACs. Simmons is listed in Forbes magazine as the 33rd richest person in America with a net worth of $9.3 billion. Simmons said he was contributing money to super PACs to stop "that socialist," President Barack Obama.

Next is Texas homebuilder Bob Perry, who contributed $21,465,000 to super PACs. Perry is one of the most prolific donors in contemporary political history. He was a major backer of Swift Boat Veterans for Truth, the outside group that helped torpedo Democratic Senator John Kerry's presidential campaign in 2004. Perry's net worth has been estimated at around $650 million.

Then there is Robert Rowling, the Texas billionaire who runs the business holding company TRT Holdings, who has contributed $5.135 million to super PACs in the 2012 election cycle. Rowling ranks 66 on Forbes list of richest Americans, with a net worth of $4.7 billion. He gave $5 million to American Crossroads, $100,000 to Restore Our Future (supporting Romney) and $35,000 to Texas Conservatives.

Peter Thiel, the hedge fund manager, venture capitalist and early Facebook investor, has contributed $4.73 million to super PACs -- the majority, $2.73 million, has gone to Endorse Liberty, a super PAC supporting Ron Paul in the Republican presidential race. A radical libertarian, Thiel ranks 293 on the Forbes list of richest Americans, with a net worth of $1.5 billion.

William Koch, the lesser-known Koch brother, and two of his petroleum, energy and minerals companies Oxbow Carbon and Huron Carbon, gave $4 million to Restore Our Future (backing Romney) and $500,000 to America 360 Committee.

Besides just individual ultra-rich campaign donors and corporations, there was also a counter-balance...the labor groups, who represent millions of ordinary American workers, those who are the backbone of America's middle-class.

  • The United Auto Workers union has contributed $10,707,000 to super PACs in 2012.
  • The National Education Association, the largest U.S. labor union representing teachers, contributed $9,707,000 to super PACs.
  • The Service Employees International Union, the nation's fastest growing labor union representing close to 2 million people, contributed $9,435,907 to super PACs.
  • The AFL-CIO, the nation's largest federation of unions, contributed $6,123,437 to super PACs. The federation has 12.2 million members and is made up of 57 national and international labor unions.
  • The American Federation of State, County and Municipal Employees (AFSCME) is the nation's largest public employee union with 1.6 million members, and contributed $4,174,085 to super PACs.
  • The American Federation of Teachers, the second-largest union in the nation with 1.5 million members, gave $3,866,558 to super PACs.

The Obama campaign said that it had reached a grass-roots milestone, surpassing over 4 million individual donors --- raising more than half its money from donations under $200.

But wouldn't the labor union's money have been better spent by decreasing member's monthly union dues and/or in financing healthcare insurance and other worker's benefits? And wouldn't the corporate money have been better spent by properly taxing the multi-national corporations and hiring more IRS tax auditors to catch super-wealthy income tax evaders?

The 2012 election saw more meddling by wealthy individual and corporate interests than any since the Gilded Age. In the final month of his last campaign, the President made clear his opposition to unlimited campaign cash, saying, "This is an issue that, in a second term, I'll raise."

The upcoming State of the Union Address is when the President Obama will outline his priorities for the entire country. And the best way to make sure election spending is among them is for him to hear from us -- the people he represents. (Here is the petition)

I propose publicly funded elections for both presidential and congressional elections, with a cap on what each viable political party can spend, and what each individual donor can contribute, and excludes unions and corporations altogether.

Maybe then, and only can, the politicians will be more beholden to The People's voice -- and they will stop catering to special interests, such as the corporate lobbyists on K Street, who are paid like the CEOs on Wall Street.

Update: Florida Republican Governor Rick Scott (who defrauded Medicare) is planning to spend $100 million on his re-election.

Joke of the Day: Deadbeat dad and former Republican Representative Joe Walsh says he is starting a super PAC to support " freedom-loving conservative alternatives to Karl Rove on FOX NEWS."

* Here are the ten largest institutional shareholders in Sheldon Adelson's Las Vegas Sands Corporation (as of September 30th, 2012) AKA "The CEOs on Wall Street".
  • Price T. Rowe Associates Inc. /MD/ held 26,855,384 shares on 09/30/2012 worth $1,245,284,127. This brought the portfolio total to 0.37%.
  • Capital World Investors held 24,858,776 shares on 09/30/2012 worth $1,152,701,417. This brought the portfolio total to 0.43%.
  • Sands Capital Management LLC. held 16,634,796 shares on 09/30/2012 worth $771,355,473. This brought the portfolio total to 3.17%.
  • Vanguard Group Inc. held 11,843,050 shares on 09/30/2012 worth $549,162,216. This brought the portfolio total to 0.07%.
  • FMR LLC. (Fidelity Investments) held 10,024,844 shares on 09/30/2012 worth $464,852,006. This brought the portfolio total to 0.08%.
  • Blackrock Institutional Trust Company N.A. held 8,599,533 shares on 09/30/2012 worth $398,760,336. This brought the portfolio total to 0.09%.\
  • Winslow Capital Management LLC. held 7,658,345 shares on 09/30/2012 worth $355,117,449. This brought the portfolio total to 1.1%.
  • UBS Global Asset Management Americas Inc. held 7,058,779 shares on 09/30/2012 worth $327,315,575. This brought the portfolio total to 0.47%.
  • State Street Corp. held 6,068,093 shares on 09/30/2012 worth $281,377,466. This brought the portfolio total to 0.04%.
  • Capital Research Global Investors held 5,270,000 shares on 09/30/2012 worth $244,369,894. This brought the portfolio total to 0.11%.

1 comment:

  1. * * * Private equity firms (such as Bain Capital), are unlike publicly traded U.S. corporations, in that they don't have to publicly disclose as much information about their company and investors (such as CEO salaries, etc.). So with Sheldon Adelson's Las Vegas Sands Corporation, as an American company, it could still have the majority of its shareholders as foreign investors in private equity firms holding Las Vegas Sands company stock.

    Remember, Supreme Court Justice Samuel Alito was seen to mouth the words, "Not true."

    He either lied, or he was ignorant on the matter, and President Obama was right. I report, you decide.

    ReplyDelete