Archive for the ‘Congress’ Category

As a candidate, Trump’s claim to legitimacy and mass support was built on a rejection of insider politics and pledges to “drain the swamp” in Washington. However, in the lead up to his inauguration, he and congressional Republicans have shown multiple signs that they intend to do just the opposite, one of which is their unprecedented barrage of attacks on ethical protections.

The most discussed ethical issue is of course Trump’s unwillingness to tackle his own personal conflicts of interest and interconnected assets. But beyond that problem, there have been three other obvious affronts. First was the considered lack of focus from Trump’s Cabinet appointees on completely disclosing and dealing with their own conflicts as required by law. Second was an ignoring (and disdaining of) the Office of Governmental Ethics (OGE) as it tries to administer both Trump and his appointee’s transition process, and third was an unexpected attack on the Office of Congressional Ethics—the independent House ethics watchdog.

At his press conference last week, Trump announced a new arrangement for his business holdings, which will do little to curb his conflicts of interest. Trump declined to divest himself of his holdings, instead only transferring control of them to his two sons. Without full divestment, Trump will still have a financial interest in his global company when he takes office later this week. Scarily, that means that Trump soon will be making regulatory decisions impacting businesses (such as banks, insurance companies, and more) that are entangled with his own. He also will be deciding American foreign policy in countries where he still has holdings and where his businesses could directly profit.

Office of Governmental Ethics Director Walter Shaub has correctly described President-elect Trump’s announced plan as “wholly inadequate.” Since stating his opinion on the Trump plan, Shaub has faced several attacks. First, from U.S. Rep. Jason Chaffetz (R-UT), chairman of the House Oversight and Government Reform Committee, when he made threats in a letter to investigate and potentially eliminate the OGE. The second came from Reince Priebus, the incoming White House chief of staff, when he said that Shaub should “be careful” about criticizing Trump’s handling of his business conflicts. This kind of veiled threat as Shaub tries to critique Trump’s inadequate ethics plan is thuggish and unwarranted.

On the second battle ground, OGE also has made important comments about the slow pace of Trump’s nominees to submit their ethics forms, which typically are cleared before their nominations are even announced. With so many extraordinarily rich appointees (the Cabinet will include three billionaires and is set to become the wealthiest in U.S. history), the problem of their interconnected finances is even more acute. To figure out their plans for recusal from ethical conflicts, nominees must do more than just fill out a form.

The OGE should be free to comment—both with critique and praise, as the Cabinet nominees and others move through the appointment paperwork process.

On the third ethics front, two weeks ago, as Congress started up, House Republicans tried to quietly change House rules and undermine the independent ethics watchdog, the Office of Congressional Ethics. The immediate public outrage led to congressional chaos and forced the Republicans to withdraw their plan.

The blatant attacks on the institutions charged with upholding ethical standards – the OCE and the OGE – coupled with the obvious disregard from incoming President Trump and some of his Cabinet members for resolving their own conflicts, leaves us deeply concerned about the state of ethics in the new administration.

There is no way to reject insider politics without keeping an ethically clean house, but the incoming Trump White House seems to need a new cleaning service.

This article originally appeared on The Huffington Post.

Last week, Public Citizen’s Chamber Watch project began a series exposing the U.S. Chamber of Commerce as one of the central actors pushing the modern day Republican Party’s extremist agenda. This week, we dive into the Chamber’s dark money spending during the 2016 election cycle. As discussed in last week’s blog, under Tom Donohue’s leadership, the U.S. Chamber of Commerce has gone from a rather staid business advocacy organization with ties to both political parties to one that has become rabidly partisan.

In the 2016 election cycle, however, the Chamber took partisanship to even greater heights. For the first time ever, 100% of the Chamber’s elections spending benefited Republicans. What’s more, the Chamber formed an explicit alliance with leading Republicans (enter Mitt Romney, Jeb Bush, Carly Fiorina) whose goal was to “Save the Senate” for the GOP and prevent a Democratic takeover of the closely-divided body.  The Chamber was so determined to preserve a Republican majority in the Senate that it even spent big against Democrat Evan Bayh, a man it used to employ, and top Chamber officials often disparaged and mocked Bayh and other Democratic candidates on social media.

The Chamber, like other groups organized under section 501(c) of the tax code, is not legally required to disclose the sources of the money it independently spends on elections. It and other dark money groups can serve as conduits for anonymous donations from corporations and other wealthy special interests to flood elections, making it particularly dangerous to democracy. In a recently released report, “The Republican Party and the Chamber of Secrets,” Chamber Watch analyzed campaign spending data from the Center for Responsive Politics to get a fuller picture of the Chamber’s election spending.

The Chamber was the second largest non-disclosing outside spender in the 2016 cycle, after the National Rifle Association, and was the largest non-disclosing outside spender on congressional races. It spent nearly $30 million, all to benefit Republican candidates. [Table 1]

TABLE 1: SPENDING BY TOP 10 NON-DISCLOSING OUTSIDE GROUPS IN 2016 FEDERAL ELECTIONS
RANK GROUP TOTAL VIEW*
1 NATIONAL RIFLE ASSOCIATION $33,585,089 C
2 U.S. CHAMBER OF COMMERCE $29,771,619 C
3 45 COMMITTEE $21,339,017 C
4 AMERICANS FOR PROSPERITY $14,022,484 C
5 AMERICAN FUTURE FUND $12, 735,724 C
6 MAJORITY FORWARD $10,127,545 L
7 LEAGUE OF CONSERVATION VOTERS $7, 292,098 L
8 AMERICAN ACTION NETWORK $5,559,198 C
9 ENVIRONMENTAL DEFENSE ACTION FUND $4,341,655 L
10 CLUB FOR GROWTH $4, 061, 723 C

Source: Center for Responsive Politics (www.opensecrets.org)

*View: C = Conservative, L = Liberal, as determined by the Center for Responsive Politics

The Chamber spent most heavily on races for the U.S. Senate, spending a total of $25.8 million in 10 Senate races. Nine Senate races saw at least $25 million in outside spending – political expenditures from outside groups that are independent of a candidates’ committee. The Chamber reported expenditures in eight of these nine races and in eight of the 10 congressional races that drew the most outside spending in 2016. [Table 2]

TABLE 2: TOP 10 OUTSIDE SPENDING CONGRESSIONAL RACES IN 2016 ELECTION

RACE (DISTRICT FOR HOUSE CONTESTS)

CANDIDATES

U.S. CHAMBER SPENDING

TOTAL

OUTSIDE SPENDING

1 PA. SENATE KATIE MCGINTY (D) V. PAT TOOMEY (R) $6,106,150 $117,863,823
2 N.H. SENATE MAGGIE HASSAN (D) V. KELLY AYOTTE (R) $3,010,600 $90,754,788
3 NEV. SENATE CATHERINE CORTEZ MASTO (D) V. JOE HECK (R) $4,215,961 $90,654, 145
4 N.C. SENATE DEBORAH ROSS (D) V. RICHARD BURR (R) $0 $59,088,388
5 OHIO SENATE TED STRICKLAND (D) V. ROB PORTMAN (R) $4,606,324 $51,567,703
6 FLA. SENATE PATRICK MURPHY (D) V. MARCO RUBIO (R) $1,500,150 $49,646,281
7 IND. SENATE EVAN BAYH (D) V. TODD YOUNG (R) $2,749,450 $45,681, 549
8 MO. SENATE JASON KANDER (D) V. ROY BLUNT (R) $1,000,150 $44,742,539
9 WIS. SENATE RUSS FEINGOLD (D) V. RON JOHNSON (R) $1,350,450 $26,448,808
10 NEV. HOUSE 3 DANNY TARKANIAN (D) V. JACKY ROSEN (R) $0 $16,886,961

Source: Center for Responsive Politics (www.opensecrets.org

Both the Pennsylvania race, and the New Hampshire Senate contest broke spending records, with campaigns and outside groups spending $164 million and $121 million, respectively. In the Pennsylvania race between Pat Toomey (R) and Katie McGinty (D), the Chamber was the largest non-disclosing outside spender out of 27 groups, spending more than $6.1 million. In the New Hampshire race between Maggie Hassan (D) and Kelly Ayotte (R) the Chamber was also the largest non-disclosing spender out of 14 groups, spending more than $3 million, while the next largest non-discloser spent just over $700,000. The Nevada Senate race saw the third highest level of outside spending, with the Chamber spending more than $4.2 million, more than any of the other 26 dark money spenders. Out of the top ten races with the most outside spending, the Chamber was the highest spender among non-disclosing groups in five races. [Table 3]

TABLE 3: CHAMBER SPENDING IN 2016 CONGRESSIONAL CONTESTS

RACE (DISTRICT FOR HOUSE CONTESTS)

CANDIDATES

U.S. CHAMBER SPENDING

U.S. CHAMBER RANKING AMONG NONDISCLOSING GROUPS

OUTCOME FOR CHAMBER-BACKED CANDIDATE

1 PA. SENATE KATIE MCGINTY (D) V. PAT TOOMEY (R) $6,106,150 1 OF 27 W
2 OHIO SENATE TED STRICKLAND (D) V. ROB PORTMAN (R) $4,606,324 1 OF 13 W
3 NEV. SENATE CATHERINE CORTEZ MASTO (D) V. JOE HECK (R) $4,215,961 1 OF 27 L
4 N.H. SENATE MAGGIE HASSAN (D) V. KELLY AYOTTE (R) $3,010,600 1 OF 14 L
5 IND. SENATE EVAN BAYH (D) V. TODD YOUNG (R) $2,749,450 1 OF 8 W
6 ALA HOUSE 2* ROBY MARTHA (R) V. BECKY GERRITSON (R) $1,750,150 1 OF 2 W
7 FLA SENATE PATRICK MURPHY (D) V. MARCO RUBIO (R) $1,500,150 4 OF 18 W
8 WIS. SENATE RUSS FEINGOLD (D) V. RON JOHNSON (R) $1,350,450 2 OF 15 W
9 ARIZ. SENATE ANN KIRKPATRICK (D) V. JOHN MCCAIN (R) $1,250,150 1 OF 6 W
10 MO. SENATE JASON KANDER (D) V. ROY BLUNT (R) $1,000,150 4 OF 15 W
11 GA. HOUSE 3* MIKE CRANE (R) V. DREW FERGUSON (R) $650,150 1 OF 1 W
12 ILL. SENATE TAMMY DUCKWORTH (D) V. MARK KIRK (R) $550,150 2 OF 4 L
13 KAN. HOUSE 01* TIM HUELSKAMP (R) V. ROGER MARSHALL (R) $401,907 1 OF 2 W
14 N.Y. HOUSE 11 RICHARD REICHARD (D) V. DAN DONOVAN (R) $129,427 1 OF 1 W
15 KY. HOUSE 01* JAMES COMER (R)  V. MICHAEL PAPE (R) V. JASON BATTS (R) $100,150 1 OF 2 W
16 ILL. HOUSE 18* DARIN LAHOOD (R) V. MIKE FLYNN (R) $100,150 1 OF 2 W
TOTAL $29,471,469

Source: Center for Responsive Politics (www.opensecrets.org) *Primary Election

Of the ten marquee Senate races in 2016, the Chamber spent in 9 of them.  The Republican candidates it supported won 7 of those 9, guaranteeing that the Senate would in fact be “saved” for the GOP. While it’s of course impossible to say that the Chamber’s dark money deluge in these races accounted for the slew of GOP victories, it certainly may have helped tip the balance in the closer races.

The Chamber’s deluge of dark money in congressional races should alarm all those concerned about the health of our democracy. When the nation’s leading business group can form an explicit alliance with one of our two major parties and solicit unlimited donations from anonymous donors, individual voters and small businesses should be worried that their voices will be shut out.

The Chamber’s 2016 election spending makes it abundantly clear that rather than being a voice for American business, the Chamber has become a very loud, very powerful voice for the Republican Party.

Last week, the Consumer Financial Protection Bureau (CFPB) fined Wells Fargo $185 million for the astounding abuse of opening more than two million unauthorized deposit and credit card accounts.

Now, Senate Majority Leader Mitch McConnell (R-Ky.) is employing a rarely used procedure to force a rushed vote on a bill to defang the CFPB.

Ok, now here’s a quiz. Can you guess which member of Congress with his wife holds more Wells Fargo stock than any other, at least according to the most recently available financial disclosure forms?

You guessed right! Mitch McConnell.

Let’s walk this through in more detail.

On Friday, the CFPB announced $185 million in fines and penalties against Wells Fargo for the jaw-dropping, illegal practice of opening deposit and credit card accounts for consumers who did not request them and did not know they existed. Not just a few such accounts — 2 million of them. According to Wells Fargo, more than 5,000 employees were involved in setting up the sham accounts.

One hundred million of that total penalty was imposed by the CFPB; $35 million goes to the Office of the Comptroller of the Currency, and $50 million to Los Angeles. The $100 million fine is the largest ever imposed by the CFPB.

2016-09-15-1473948463-9494296-ScreenShot20160915at10.06.23AM.png

Enter Mitch McConnell.

This week, he announced plans to rush to the Senate floor S. 3318, “A bill to amend the Consumer Financial Protection Act of 2010 to subject the Bureau of Consumer Financial Protection to the regular appropriations process, and for other purposes,” introduced by Georgia Republican Senator David Perdue.

You might be curious to read the bill.

Too bad.

It was just introduced on Monday, and the text does not yet appear oncongress.gov, the website where proposed bills are posted.

2016-09-15-1473949249-707470-ScreenShot20160915at10.20.05AM.png

But the title tells you what you need to know. When the CFPB was created, Congress gave it budget autonomy — it is funded by transfers from the Federal Reserve system, and its budget is set at 12 percent of Federal Reserve operating expenses. The CFPB creators built in this feature because they knew that otherwise the Big Banks could destroy the consumer bureau by stripping its funding. This isn’t unique among banking regulators — the Fed, the OCC, the FDIC and others all share this autonomy, as it has long been recognized that our cops on the financial beat should not be subject to appropriations while policing Wall Street. Since then, the Big Banks have lobbied hard to subject the CFPB to congressional appropriations, almost explicitly for the purpose of slashing its funding and stopping it from doing its job.

S. 3318 is not following the traditional pathway to the floor of the Senate. It has not yet been debated and voted on in committee. Instead, using a special procedure, Majority Leader McConnell is taking it straight the Senate floor.

Which raises the question: Senator, what’s the rush?

Well, it just may be that Mitch McConnell brings a special passion to the issue, in the wake of the CFPB penalty on Wells Fargo.

In his 2015 financial disclosure form, McConnell reports between $1,000,001 and $5,000,000 in deferred compensation for his wife, Elaine Chao, from Wells Fargo. Chao, the former Secretary of Labor, serves on Wells Fargo’s board of directors.

2016-09-15-1473951317-1602265-ScreenShot20160915at10.54.46AM.png

The bank paid her a not inconsiderable $291,027 in 2015 for her board service.

2016-09-15-1473949439-8003426-ScreenShot20160915at10.23.27AM.png

Quite something, right?

We cannot assume that McConnell is acting just to punish the CFPB for imposing a modest fine on Wells Fargo for its systematic misdeeds.

It’s entirely possible — arguably more likely — that McConnell is acting to please his Wall Street paymasters, more than out of pique in response to the CFPB penalizing a megabank to which he’s unusually close.

It’s true that that can pass as a kind of ethics defense in Washington, D.C. (see theongoing case of Rep. Roger Williams, R-Texas, also an auto dealer, who is defending himself against charges of wrongdoing related to the introduction of an amendment to benefit auto dealers on the grounds that he was not trying to benefit himself but was instead doing a favor for a lobbyist for the National Automobile Dealers Association). But it doesn’t wash among Americans uncontaminated by Washington corruption.

It’s clear that Americans want transparency when it comes to how companies spend in politics.

Courtesy Flickr/Almond Butterscotch.

Courtesy Flickr/Almond Butterscotch.

The next administration and the U.S. Securities and Exchange Commission (SEC) must address secret corporate political spending because it poses a great threat to democracy and investor confidence, says a new report by Public Citizen. The report, highlighting the historic campaign for an SEC rule requiring publicly held corporations to disclose their political spending, comes in advance of a Sept. 20 event on the state of corporate disclosure and as Public Citizen and its partners in the Corporate Reform Coalition (CRC) review and plan ahead for a new administration and new SEC priorities.

The Sept. 20 event is organized by Public Citizen, the AFL-CIO, Americans for Financial Reform, Ceres the Financial Accountability & Corporate Transparency (FACT) Coalition, the International Corporate Accountability Roundtable (ICAR), Patriotic Millionaires and SIF: The Forum for Sustainable and Responsible Investment, and hosted by the Center for American Progress. It will explore the SEC’s recent “Disclosure Effectiveness” review, which is evaluating corporate disclosure requirements, and the role of environmental, social and governance disclosures in promoting a sustainable economy.

The report details how a five-year campaign has driven 1.2 million comments to the SEC in support of a disclosure rule – the most in the agency’s history. The campaign also has garnered more than 500 stories in local and national press, and brought together powerful champions on Capitol Hill who are working to ensure that an SEC rulemaking on disclosure is not obstructed by congressional Republicans’ insertion of a harmful policy rider into the appropriations process that would stop the SEC from finalizing the rule. In addition, another 20,000 comments supporting political spending disclosure have come into the agency as comments to its “Disclosure Effectiveness” review process and to the agency’s Regulation S-K concept release, which solicited comments on proposed changes to corporate financial statement requirements.

The campaign began in response to the disastrous 2010 U.S. Supreme Court decision in Citizens United v. FEC, which opened the floodgates for corporations to spend unlimited and undisclosed amounts to influence American politics. In 2011, a bipartisan committee of leading corporate and securities law professors filed the first petition requesting a rulemaking at the SEC requiring all public companies to disclose their political expenditures. In response, the agency began a rulemaking, then halted it.

In this election cycle, secret outside spending is the highest it has ever been, clocking in at a whopping $660 million. Americans know that corporate influences lurk behind most campaign ads. Polls show they remain frustrated by the lack of transparency around corporate political spending.

Disclosure is material to investors as they consider the risk of their investment and important to the American voters who want to know who is bankrolling their elections. The SEC needs to take a stand and move forward with this rulemaking.

village-1357192_640At a time when public approval of Congress remains near all-time lows, revisiting campaign finance laws is critical. Party officials have recommended members spend roughly twice as much time fundraising as they do on the floor or in committee. U.S. House members raise on average $2,400 every single day of their term. U.S. Senators will raise roughly twice that.

These campaign spending increases are reflected at the state and local level as well. For example, a single local school board race in California resulted in over $3.5 million in inside and outside spending. The tides may be shifting, however.

California is now poised to enact a law which would lift the state’s ban on publicly financed campaigns. SB 1107 passed with bipartisan backing last week. It gives local and state government to option stick with the current system or switch to public financing. The bill requires public financing laws have a dedicated funding source and that funds be “available to all qualified, voluntarily participating candidates for the same office without regard to incumbency or political party preference.”

Public Citizen’s members in California sent over 1,200 letters to their assembly members in the days leading up to the vote. All that’s left is for Gov. Jerry Brown to sign the bill.  You can contact his office at (916) 445-2841 and ask him to sign SB 1107.

Voters in California will have further opportunity to express their frustration with the current system when Proposition 59 appears on their ballots this November. It is a resolution that calls on California legislators to do everything they can to overturn Citizens United v. Federal Election Commission. Yesterday, the Sacramento Bee endorsed the measure, which is backed by groups such as California Common Cause, calPIRG, Courage Campaign and others.

© Copyright . All Rights Reserved.