The DISCLOSE Act- Antidote to the SuperPACs?

                                                            Robert A. Levine   2-17-12

Most citizens paying attention to the current Republican presidential primaries would agree that the new power of the SuperPACs following the Citizens United decision by the Supreme Court two years ago is undermining the democratic process. By allowing unlimited contributions to these organizations by individuals, corporations, unions and other entities, the voices of ordinary Americans have been drowned out by advertising spawned by special interests.

 Though the Citizens United ruling by a 5-4 decision of the Court was purportedly to enhance freedom of speech, it has greatly tilted the political playing field in favor of the wealthy. And Republican candidates have benefited disproportionately. The pro-Romney SuperPAC, Restore Our Future, collected $18 million from two hundred donors in the second half of last year, with 10% of America’s billionaires contributing. Newt Gingrich’s SuperPAC, Winning The Future, received $10 million from hotel and gambling magnate Sheldon Adelson and his wife. Foster Freiss, a wealthy investor, is the main backer of Rick Santorum’s SuperPAC, the Red, White and Blue Fund. With no financial or other restrictions, the SuperPACs have concentrated on negative advertising, using attack ads that bend the truth to tear down opponents. Obama recently reversed his stand on SuperPAC funds to try and bolster his own fundraising to compete with the Republican organizations.

The advent of the SuperPACs promises to make the 2012 election the most expensive and most negative in history, notwithstanding the electorate’s disdain for these ads. Political strategists employ them because they work. And since the SuperPACs are supposed to be independent of the campaigns, it allows the candidates deniability for the mudslinging.

How can America control the growth and power of these SuperPACs that allow the most affluent individuals and corporations to dominate the political dialogue? Though Citizens United could be overturned by a constitutional amendment or a change in the composition of the Supreme Court, neither of these is very likely. However, increasing the transparency of the SuperPACs could have a significant effect. Donors might be more reluctant to contribute knowing that they and their businesses would be open to scrutiny if their names were promptly revealed. It would also show voters where the candidates were generating support and stockholders where their money was going.

The DISCLOSE Act (Democracy is Strengthened by Casting Light on Spending in Elections) was originally introduced in 2010. It was passed by the House and blocked by Republicans in the Senate on a party-line vote. Though most of its provisions appear to be common sense in a democratic system, the problem with the bill is that it was formulated by Democrats; Schumer, Leahy and Whitehouse in the Senate and Van Hollen in the House. It has been recently reintroduced, but without any bipartisan support, it is virtually dead on arrival in both Houses of Congress.

Among the important provisions of the DISCLOSE Act-

Would require explicit disclaimers for political ads- the top fund raiser would have to issue a disclaimer standing by the information given, similar to what candidates currently must do. And the five top donors to the organization would be listed on the screen at the end of the ad.

Corporations receiving federal contracts worth more than $50,000, foreign corporations, and companies that have not paid back their TARP money would be banned from spending money on federal elections.

The act would also require that donors of $10,000 or more be revealed within twenty-four hours, which would go a long way towards transparency.

Though the DISCLOSE Act has been opposed by the ACLU as well as Republicans as an infringement on free speech and privacy, it seems reasonable to have people and organizations who sponsor political advertisements stand behind their messages. It’s merely truth in advertising and anonymous negative ads have no place in our democracy.

In terms of political advertising in America (and everywhere else), it’s obvious that- money talks; always has and always will.

Resurrecting Democracy
www.robertlevinebooks.com

Weakening the STOCK Act- Stock and Trade of the House Republicans

                           Robert A. Levine

Once again, House Republicans have been unwilling to take a strong stand against insider trading. Though a revised version of the STOCK Act (Stop Trading On Congressional Knowledge) was passed yesterday by the House by an overwhelming margin, it was only after Republicans had weakened the bill. In December, Republican Spencer Bachus from Alabama, Chairman of the House Financial Services Committee postponed voting on a bill that would have prohibited insider trading by members of Congress. This was despite the fact that the bill had over a hundred co-sponsors and overwhelming public support. Today the Washington Post reported today that Bacchus is under investigation by the Office of Congressional Ethics for possible insider-trading violations. How’s that for having the fox in the henhouse?

 In the current bill, Republican Representative Eric Cantor of Virginia and the House Republican leadership eliminated a provision  that would have regulated the collection of intelligence gleaned from political insiders; ie members of Congress, senators and other federal officials. This valuable knowledge can be passed on to hedge funds, mutual funds and other financial industry personnel who use it to determine investment strategies. The Senate had previously approved the bill with a provision that required “political intelligence consultants” to register as lobbyists and divulge their activities. Republican Senator Grassley of Iowa, who had crafted the amendment on political intelligence, was quite angry over the House Republicans’ actions, saying- “It’s astonishing and extremely disappointing that the House would fulfill Wall Street’s wishes by killing this provision.” But Congressman Cantor wanted further study of the issue by the Government Accountability Office which could delay action for up to a year.

 According to Democratic Representative Louise Slaughter of New York, one of the originators of the STOCK Act, Wall Street and those involved in the political intelligence industry had been lobbying against the Grassley measure. They were concerned that the required registration would have compelled transparency from investment advisors regarding clients to whom they transmitted political intelligence. And Wall Street and their lobbyists were successful in their efforts to gut the bill of the troublesome provision.
 Once again, ethics has taken a back seat to Wall Street’s needs and political expediency. What’s new?

 Resurrecting Democracy
www.robertlevinebooks.com

Amnesia or Forgiveness? American Voters Disregard of Ethics Violations

Amnesia or Forgiveness? America Voters’ Disregard of Ethic Violations
                                    Robert A. Levine    1-11-12
In the current Republican presidential primaries, Newt Gingrich has garnered significant levels of support despite past ethical “missteps.” He was involved in the House banking scandal with bad checks in the late 80s and early 90s. The House Ethics Committee levied a $300,000 fine on him in 1997 for using non-profit organizations for partisan political purposes. He excoriated President Clinton for sexual improprieties while he himself was married and having an affair with a much younger woman. There was also a sweetheart deal Gingrich made with a publisher in 1994 that gave him a $4.5 million advance. The pattern of unethical behavior is clear, yet has been disregarded by many voters.

By voting for them again, Americans repeatedly seem willing to forgive politicians’ ethical lapses, questionable conduct and frank hypocrisy, or are citizens simply amnesic?    
      
Almost daily, there are revelations about elected officials at municipal, state and federal levels who are guilty of ethical transgressions or frank felonies. Democracy is supposed to act as a check on officeholders who utilize their positions for venal purposes. Periodically, the voters sit in judgment of those they have elected and are able to dismiss them. And those who have committed egregious offenses can be recalled through petitions and special elections. But that rarely happens.

The electorate is far too lenient in the way it indulges ethically-challenged politicians. Sitting officeholders have been re-elected by their constituents while criminal charges were pending and the evidence of guilt was overwhelming. And ethics violations often seem to mean nothing to the voters, even when affirmed by established ethics committees or independent watchdog groups.

In addition to Gingrich, examples abound. Mary Jo Kopechne drowned at Chappaquidick when Democratic Senator Ted Kennedy was apparently driving drunk and went off a bridge into the water. He left the scene of the accident without reporting it and did not go to the police to try and rescue the woman. Yet in spite of his conduct, his constituents in Massachusetts saw fit to send him back to Washington repeatedly.

Republican David Vitter, a family values religious conservative from Louisiana was involved with prostitutes both before and after his election to the Senate in 2004 and was re-elected in 2010 after all the information regarding this became public.

Republican Senator John McCain of Arizona was rebuked by the Senate Ethics Committee for his actions as one of the Keating Five in the late 1980s. McCain and the others interceded with federal regulators of the banking industry on behalf of Charles Keating and the Lincoln Savings Bank after having received hundreds of thousands of dollars from Keating. The senators were able to block the closing of the corrupt bank, costing taxpayers billions of dollars. Yet McCain was successfully re-elected four times afterwards and secured the Republican nomination for president in 2008.

Democratic Congressman William Jefferson was returned to Congress in 2006 by his constituents in Louisiana after $90,000 in unexplained bills were found wrapped in aluminum foil in his freezer and he was accused of various criminal schemes. He was subsequently found guilty of multiple counts and sentenced to thirteen years in prison.
         
In the House Banking Scandal from 1988 to 1991, hundreds of Congressmen wrote overdrafts on their House bank accounts. No penalties or fees were assessed and many of those involved were subsequently re-elected.

There were also dozens of Senators and members of Congress who took money from Jack Abramoff to vote certain ways, or to help Abramoff’s clients deal with federal agencies. Both Republicans and Democrats participated in these schemes, among them Senators Harry Reid, Conrad Burns and Byron Dorgan. Congressmen included Tom DeLay, Denis Hastert, J.D. Hayworth, Roy Blount and Patrick Kennedy.

These are only a small fraction of federal legislators involved in unethical activities over the years. Executive branch members have also been compromised, as well as numerous officials at lower levels. But this problem of corruption is not being addressed by voters. They do not hold elected officials to high standards, perhaps reinforcing perverse conduct.  It is time that Americans became more discerning when they vote and less forgiving of corrupt behavior by officeholders. Character is far more important than a candidate’s ideology. Past actions usually predict politicians’ future performance.

Resurrecting Democracy
www.robertlevinebooks.com

More Congressional “Chutzpah”
                        Robert A. Levine  12-26-11
Congress has done it again, giving their members special consideration other Americans can only dream of. For some time now, Congressional insiders have been able to enrich themselves on the basis of knowledge not available to the public. (Washington officeholders have access to a treasure trove of economic data not available to ordinary citizens.)
 After prime time exposure of Congressional insider trading depicted on CBS’s 60 Minutes recently, there was a sudden moment of understanding by many members of Congress and Senators that public anger demanded a change in standard Washington behavior. It was assumed that legislation would be passed to prohibit Congressional members and staffers from using privileged information to engage in stock trading as is the law of the land for the general population.
 Actually, a bill to ban insider trading by office holders in Washington was introduced seven years ago called Stop Trading on Congressional Knowledge (STOCK) Act by Representatives Louise Slaughter and Brian Baird, both Democrats. However, since it was introduced, this measure has languished in Congress irrespective of whether Republicans or Democrats had majorities, with members of neither party apparently wanting to terminate a potentially lucrative practice. Then, Congressmen and Congresswomen suddenly “got religion” when their insider trading was prominently disclosed, with the story kept alive by the media amid a public outcry.
Unfortunately, Congressional shame and remorse has evidently been short-lived. The House Financial Services Committee Chairman, Alabama Republican Spencer Bachus, on December 7 postponed a vote on legislation that would have proscribed insider trading. After meeting with other House Republicans, he claimed that “a significant number of members of the committee on both sides of the aisle have indicated a desire for additional time to study the issue.” This ignored the fact that the bill to end insider trading had over a hundred co-sponsors and overwhelming public support. Why should we not be surprised by this action? Over the years, it has been shown that Congressional insiders who trade in stocks outperform the market by about 12% annually, a better result than most hedge fund managers. Obviously, the access to privileged information that members of Congress and their staffers are able to acquire has been very profitable for some of them and it is easy to comprehend their reluctance to give it up. And Chairman Bachus was identified as someone who traded in stock options, having done so after having received a Treasury report in 2008 focusing on problems with the economy.
Is it any wonder that Congressional approval ratings are currently in single digits and that the public views politicians with such disdain? Their personal goals and ethics are not aligned with those of other citizens, and they can enact legislation (such as banning insider trading by ordinary Americans) that does not necessarily apply to them.
Chutzpah is a bipartisan characteristic. It is a Yiddish term that denotes acts or conduct of unusual effrontery, arrogance, brazenness, or hypocrisy in disregard of normal standards of behavior and other people’s sensitivities. Members of Congress certainly are imbued with an inordinate amount of chutzpah. On the other hand, the American electorate lets them get away with it.
 Resurrecting Democracy
www.robertlevinebooks.com