Original Link: http://www.alternet.org/economy/ten-numbers-rich-would-fudged
By Paul Bucheit
Only THREE PERCENT of the very rich are entrepreneurs.
According to both Marketwatch and economist Edward Wolff, over 90 percent of the assets owned by millionaires are held in a combination of low-risk investments (bonds and cash), personal business accounts, the stock market, and real estate. Only 3.6 percent of taxpayers in the top .1% were
classified as entrepreneurs based on 2004 tax returns. A 2009 Kauffman Foundation study found that the great majority of entrepreneurs come from middle-class backgrounds, with less than 1 percent of all entrepreneurs coming from very rich or very poor backgrounds.
2. Only FOUR OUT OF 150 countries have more wealth inequality than us.
In a world listing compiled by a reputable research team (which nevertheless prompted double-checking), the U.S. has greater wealth inequality than every measured country in the world except for Namibia, Zimbabwe, Denmark, and Switzerland.
3. An amount equal to ONE-HALF the GDP is held untaxed overseas by rich Americans.
The Tax Justice Network estimated that between $21 and $32 trillion is hidden offshore, untaxed. With Americans making up 40% of the world's Ultra High Net Worth Individuals, that's $8 to $12 trillion in U.S. money stashed in far-off hiding places.
Based on a historical stock market return of 6%, up to $750 billion of income is lost to the U.S. every year, resulting in a tax loss of about $260 billion.
4. Corporations stopped paying HALF OF THEIR TAXES after the recession.
After paying an average of 22.5% from 1987 to 2008, corporations have paid an annual rate of 10% since. This represents a sudden $250 billion annual loss in taxes.
U.S. corporations have shown a pattern of tax reluctance for more than 50 years, despite building their businesses with American research and infrastructure. They've passed the responsibility on to their workers. For every dollar of workers' payroll tax paid in the 1950s, corporations paid three dollars. Now it's 22 cents.
5. Just TEN Americans made a total of FIFTY BILLION DOLLARS in one year.
That's enough to pay the salaries of over a million nurses or teachers or emergency responders.
That's enough, according to 2008 estimates by the Food and Agriculture Organization and the UN's World Food Program, to feed the 870 million people in the world who are lacking sufficient food.
For the free-market advocates who say "they've earned it": Point #1 above makes it clear how the wealthy make their money.
6. Tax deductions for the rich could pay off 100 PERCENT of the deficit.
Another stat that required a double-check. Based on research by the Tax Policy Center, tax deferrals and deductions and other forms of tax expenditures (tax subsidies from special deductions, exemptions, exclusions, credits, capital gains, and loopholes), which largely benefit the rich, are worth about 7.4% of the GDP, or about $1.1 trillion.
Other sources have estimated that about two-thirds of the annual $850 billion in tax expenditures goes to the top quintile of taxpayers.
7. The average single black or Hispanic woman has about $100 IN NET WORTH.
The Insight Center for Community Economic Development reported that median wealth for black and Hispanic women is a little over $100. That's much less than one percent of the median wealth for single white women ($41,500).
Other studies confirm the racially-charged economic inequality in our country. For every dollar of NON-HOME wealth owned by white families, people of color have only one cent.
8. Elderly and disabled food stamp recipients get $4.30 A DAY FOR FOOD.
Temporary Assistance for Needy Families (TANF) has dropped significantly over the past 15 years, serving only about a quarter of the families in poverty, and paying less than $400 per month for a family of three for housing and other necessities. Ninety percent of the available benefits go to the elderly, the disabled, or working households.
Food stamp recipients get $4.30 a day.
9. Young adults have lost TWO-THIRDS OF THEIR NET WORTH since 1984.
21- to 35-year-olds: Your median net worth has dropped 68% since 1984. It's now less than $4,000.
That $4,000 has to pay for student loans that average $27,200. Or, if you're still in school, for $12,700 in credit card debt.
With an unemployment rate for 16- to 24-year-olds of almost 50%, two out of every five recent college graduates are living with their parents. But your favorite company may be hiring. Apple, which makes a profit of $420,000 per employee, can pay you about $12 per hour.
10. The American public paid about FOUR TRILLION DOLLARS to bail out the banks.
That's about the same amount of money made by America's richest 10% in one year. But we all paid for the bailout. And because of it, we lost the opportunity for jobs, mortgage relief, and educational funding.
Bonus for the super-rich: A QUADRILLION DOLLARS in securities trading nets ZERO sales tax revenue for the U.S.
The world derivatives market is estimated to be worth over a quadrillion dollars (a thousand trillion). At least $200 trillion of that is in the United States. In 2011 the Chicago Mercantile Exchange reported a trading volume of over $1 quadrillion on 3.4 billion annual contracts.
A quadrillion dollars. A sales tax of ONE-TENTH OF A PENNY on a quadrillion dollars could pay off the deficit. But the total sales tax was ZERO.
It's not surprising that the very rich would like to fudge the numbers, as they have the nation.
Sunday, November 25, 2012
CEO Council Demands Cuts To Poor, Elderly While Reaping Billions In Government Contracts, Tax Breaks
Original Link: http://www.huffingtonpost.com/2012/11/25/deficit-reduction-council-fiscal-cliff_n_2185585.html
By Christina Wilkie, Ryan Grim
The corporate CEOs who have made a high-profile foray into deficit negotiations have themselves been substantially responsible for the size of the deficit they now want closed.
The companies represented by executives working with the Campaign To Fix The Debt have received trillions in federal war contracts, subsidies and bailouts, as well as specialized tax breaks and loopholes that virtually eliminate the companies' tax bills.
The CEOs are part of a campaign run by the Peter Peterson-backed Center for a Responsible Federal Budget, which plans to spend at least $30 million pushing for a deficit reduction deal in the lame-duck session and beyond.
During the past few days, CEOs belonging to what the campaign calls its CEO Fiscal Leadership Council -- most visibly, Goldman Sachs' Lloyd Blankfein and Honeywell's David Cote -- have barnstormed the media, making the case that the only way to cut the deficit is to severely scale back social safety-net programs -- Medicare, Medicaid, and Social Security -- which would disproportionately impact the poor and the elderly.
As part of their push, they are advocating a "territorial tax system" that would exempt their companies' foreign profits from taxation, netting them about $134 billion in tax savings, according to a new report from the Institute for Policy Studies titled "The CEO Campaign to ‘Fix’ the Debt: A Trojan Horse for Massive Corporate Tax Breaks" -- money that could help pay off the federal budget deficit.
Yet the CEOs are not offering to forgo federal money or pay a higher tax rate, on their personal income or corporate profits. Instead, council recommendations include cutting "entitlement" programs, as well as what they call "low-priority spending."
Many of the companies recommending austerity would be out of business without the heavy federal support they get, including Goldman Sachs and JPMorgan Chase, which both received billions in direct bailout cash, plus billions more indirectly through AIG and other companies taxpayers rescued.
Just three of the companies -- GE, Boeing and Honeywell -- were handed nearly $28 billion last year in federal contracts alone. A spokesman for Campaign To Fix The Debt did not respond to an email from The Huffington Post over the weekend.
The CEO council recommends two major avenues that it claims will produce "at least $4 trillion of deficit reduction." The first is to "replace mindless, abrupt deficit reduction with thoughtful changes that reform the tax code and cut low-priority spending." The second is to "keep debt under control over the long-term by focusing on the long-term growth of entitlement programs."
CEOs are encouraged to present a Fix-The-Debt PowerPoint presentation to their "employee town hall [meetings and] company meetings." To further help get the word out, the campaign borrowed a page from the CEOs this fall who wrote letters encouraging their employees to vote for Mitt Romney, or face job cuts. This time, the CFD has created two templates for bosses to use at their companies.
But in the past week, in order to make their case to the millions of Americans who don't work for them, CEOs fanned out into television, to convince the rest of the country that slashing the social safety net is the only way to reduce the deficit.
In an interview aired Monday, Goldman Sachs chairman and CEO Lloyd Blankfein said Social Security "wasn't devised to be a system that supported you for a 30 year retirement after a 25-year career." The key to cutting Social Security, he said, was simply a matter of teaching people to expect less.
"You're going to have to do something, undoubtedly, to lower people's expectations of what they're going to get," Blankfein told CBS, "the entitlements, and what people think they're going to get, because you're not going to get it."
Blankfein and Goldman Sachs don't have to worry about lowering expectations. After receiving a $10 billion federal bailout in 2008, and paying it back a few years later, Goldman Sachs recently exceeded Wall Street analysts' expectations by announcing $8.4 billion in third quarter revenues for 2012. On the heels of a great year, Blankfein is expected to take home an even larger salary than he did in 2011, when he made $16.1 million.
To understand the importance of banking profits to the members of the deficit council, one need look no further than the two top-ranking members of the Campaign To Fix The Debt's steering committee, former New Hampshire Sen. Judd Gregg (R) and former Pennsylvania Gov. Ed Rendell, a Democrat. Gregg is currently employed as an international adviser to Goldman Sachs, while Rendell collects his paycheck from the boutique investment bank Greenhill & Co.
Following Blankfein's evening news appearance on Monday, Cote, the Honeywell CEO, sat down with the same network on Tuesday, and said essentially the same thing that Blankfein did.
Cote ranked 11th on a list compiled in a recent study conducted by the Institute for Policy Studies of executives who have saved the most from the Bush tax cuts. According to the IPS, Cote's taxable compensation for 2011 was a bit more than $55 million, and he did not pay about $2.5 million thanks to the Bush tax cuts.
After mentioning a few scary-sounding deficit statistics, he suggested the government raise revenue by ending individual tax credits and deductions, which he said amounted to a $1 trillion "giveaway" in 2011. It was clear, however, that Cote hadn't come on the show to talk about taxes.
"The big nut is going to have to be [cuts to] Medicare/Medicaid … especially with the baby boomer generation retiring. It's going to literally crush the system."
But while Cote strongly recommends cutting those benefits, when it comes to the tax obligations of corporations, he's clear about what he wants: a corporate tax rate of zero.
"From a fairness perspective, nobody would be able to stand [a zero tax rate on corporate profits]," but if the U.S. really wanted to create jobs, he said this spring, "we would have the lowest rate possible."
At Honeywell, Cote practices what he preaches. Between 2008-2010, the company avoided paying any taxes at all. Instead, the company got taxpayer-funded rebates of $34 million off of profits totaling nearly $5 billion.
Part of what makes the lobbying blitz around the fiscal cliff so complex for CEOs on the Fiscal Leadership Council is that many of them need more than just low tax rates. They also need Congress and the White House to maintain current defense spending levels so they can continue winning enormous contracts.
In 2011, $40 billion of taxpayer money was divided among just nine CFD member companies, led by defense giant Boeing, which raked in $22 billion in federal contracts alone, more than the other eight companies combined. For his efforts as CEO, Boeing's Jim McNerney took home nearly $23 million in compensation last year.
But even as McNerney lends his name to the deficit commission, his company has quietly begun laying off U.S. workers ahead of defense cuts that are expected to be part of a deficit reduction deal. The company denies that federal spending has anything to do with the job cuts, but defense industry analysts aren't convinced.
At least one faction of Boeing's workforce is thriving: Boeing lobbyists in Washington have made $12 million since January fighting proposed cuts to defense and aerospace projects.
By Christina Wilkie, Ryan Grim
The corporate CEOs who have made a high-profile foray into deficit negotiations have themselves been substantially responsible for the size of the deficit they now want closed.
The companies represented by executives working with the Campaign To Fix The Debt have received trillions in federal war contracts, subsidies and bailouts, as well as specialized tax breaks and loopholes that virtually eliminate the companies' tax bills.
The CEOs are part of a campaign run by the Peter Peterson-backed Center for a Responsible Federal Budget, which plans to spend at least $30 million pushing for a deficit reduction deal in the lame-duck session and beyond.
During the past few days, CEOs belonging to what the campaign calls its CEO Fiscal Leadership Council -- most visibly, Goldman Sachs' Lloyd Blankfein and Honeywell's David Cote -- have barnstormed the media, making the case that the only way to cut the deficit is to severely scale back social safety-net programs -- Medicare, Medicaid, and Social Security -- which would disproportionately impact the poor and the elderly.
As part of their push, they are advocating a "territorial tax system" that would exempt their companies' foreign profits from taxation, netting them about $134 billion in tax savings, according to a new report from the Institute for Policy Studies titled "The CEO Campaign to ‘Fix’ the Debt: A Trojan Horse for Massive Corporate Tax Breaks" -- money that could help pay off the federal budget deficit.
Yet the CEOs are not offering to forgo federal money or pay a higher tax rate, on their personal income or corporate profits. Instead, council recommendations include cutting "entitlement" programs, as well as what they call "low-priority spending."
Many of the companies recommending austerity would be out of business without the heavy federal support they get, including Goldman Sachs and JPMorgan Chase, which both received billions in direct bailout cash, plus billions more indirectly through AIG and other companies taxpayers rescued.
The CEO council recommends two major avenues that it claims will produce "at least $4 trillion of deficit reduction." The first is to "replace mindless, abrupt deficit reduction with thoughtful changes that reform the tax code and cut low-priority spending." The second is to "keep debt under control over the long-term by focusing on the long-term growth of entitlement programs."
CEOs are encouraged to present a Fix-The-Debt PowerPoint presentation to their "employee town hall [meetings and] company meetings." To further help get the word out, the campaign borrowed a page from the CEOs this fall who wrote letters encouraging their employees to vote for Mitt Romney, or face job cuts. This time, the CFD has created two templates for bosses to use at their companies.
But in the past week, in order to make their case to the millions of Americans who don't work for them, CEOs fanned out into television, to convince the rest of the country that slashing the social safety net is the only way to reduce the deficit.
In an interview aired Monday, Goldman Sachs chairman and CEO Lloyd Blankfein said Social Security "wasn't devised to be a system that supported you for a 30 year retirement after a 25-year career." The key to cutting Social Security, he said, was simply a matter of teaching people to expect less.
"You're going to have to do something, undoubtedly, to lower people's expectations of what they're going to get," Blankfein told CBS, "the entitlements, and what people think they're going to get, because you're not going to get it."
Blankfein and Goldman Sachs don't have to worry about lowering expectations. After receiving a $10 billion federal bailout in 2008, and paying it back a few years later, Goldman Sachs recently exceeded Wall Street analysts' expectations by announcing $8.4 billion in third quarter revenues for 2012. On the heels of a great year, Blankfein is expected to take home an even larger salary than he did in 2011, when he made $16.1 million.
To understand the importance of banking profits to the members of the deficit council, one need look no further than the two top-ranking members of the Campaign To Fix The Debt's steering committee, former New Hampshire Sen. Judd Gregg (R) and former Pennsylvania Gov. Ed Rendell, a Democrat. Gregg is currently employed as an international adviser to Goldman Sachs, while Rendell collects his paycheck from the boutique investment bank Greenhill & Co.
Following Blankfein's evening news appearance on Monday, Cote, the Honeywell CEO, sat down with the same network on Tuesday, and said essentially the same thing that Blankfein did.
Cote ranked 11th on a list compiled in a recent study conducted by the Institute for Policy Studies of executives who have saved the most from the Bush tax cuts. According to the IPS, Cote's taxable compensation for 2011 was a bit more than $55 million, and he did not pay about $2.5 million thanks to the Bush tax cuts.
After mentioning a few scary-sounding deficit statistics, he suggested the government raise revenue by ending individual tax credits and deductions, which he said amounted to a $1 trillion "giveaway" in 2011. It was clear, however, that Cote hadn't come on the show to talk about taxes.
"The big nut is going to have to be [cuts to] Medicare/Medicaid … especially with the baby boomer generation retiring. It's going to literally crush the system."
But while Cote strongly recommends cutting those benefits, when it comes to the tax obligations of corporations, he's clear about what he wants: a corporate tax rate of zero.
"From a fairness perspective, nobody would be able to stand [a zero tax rate on corporate profits]," but if the U.S. really wanted to create jobs, he said this spring, "we would have the lowest rate possible."
At Honeywell, Cote practices what he preaches. Between 2008-2010, the company avoided paying any taxes at all. Instead, the company got taxpayer-funded rebates of $34 million off of profits totaling nearly $5 billion.
Part of what makes the lobbying blitz around the fiscal cliff so complex for CEOs on the Fiscal Leadership Council is that many of them need more than just low tax rates. They also need Congress and the White House to maintain current defense spending levels so they can continue winning enormous contracts.
In 2011, $40 billion of taxpayer money was divided among just nine CFD member companies, led by defense giant Boeing, which raked in $22 billion in federal contracts alone, more than the other eight companies combined. For his efforts as CEO, Boeing's Jim McNerney took home nearly $23 million in compensation last year.
But even as McNerney lends his name to the deficit commission, his company has quietly begun laying off U.S. workers ahead of defense cuts that are expected to be part of a deficit reduction deal. The company denies that federal spending has anything to do with the job cuts, but defense industry analysts aren't convinced.
At least one faction of Boeing's workforce is thriving: Boeing lobbyists in Washington have made $12 million since January fighting proposed cuts to defense and aerospace projects.
Sunday, November 18, 2012
Five Misconceptions about our Tattered Safety Net
Original Link: http://www.commondreams.org/view/2012/11/12
By Paul Buchheit
Mitt Romney said he wasn't concerned about the very poor, because they have a safety net. This is typical of the widespread ignorance about inequality in our country. Struggling Americans want jobs, not handouts, and for the most part they've paid for their "safety net." The real problem is at the other end of the wealth gap.
How many people know that out of 150 countries, we have the 4th-highest wealth disparity? Only Zimbabwe, Namibia, and Switzerland are worse.
It's not just economic inequality that's plaguing our country. It's lack of opportunity. It's a dismissal of poor people as lazy, or as threats to society. More than any other issue over the next four years, we need to address the growing divide in our nation, to tone down our winner-take-all philosophy, to provide job opportunities for people who want to contribute to society.
Here are some of the common misconceptions:
1. Americans believe that the poorest 40 percent own about 10% of the wealth.
Most people greatly underestimate the level of inequality in our country, guessing that the poorest 40 percent own about 10% of the wealth, when in reality they own much less than 1% of the wealth. Out of every dollar, they own a third of a penny.
Factor in race, and it gets worse. Much of minority wealth exists in home values. But housing crashed, while the financial wealth owned almost entirely (93% of it) by the richest quintile of Americans has rebounded to lofty pre-recession levels.
As a result, for every dollar of NON-HOME wealth owned by white families, people of color have only one cent. Median wealth for a single white woman is over $40,000. For black and Hispanic women it is a little over $100.
2. Entitlements are the problem
No, they're not. The evidence is overwhelming. Social Security is a popular and well-run program. As summarized by Bernie Sanders, "Social Security, which is funded by the payroll tax, has not contributed one nickel to the deficit and, according to its trustees, can pay 100 percent of all benefits owed to every eligible American for the next 21 years." Dean Baker calls it "perhaps the greatest success story of any program in US history."
Medicare, which is largely without the profit motive and the competing sources of billing, is efficiently run, for all eligible Americans. According to the Council for Affordable Health Insurance, medical administrative costs as a percentage of claims are about three times higher for private insurance than for Medicare. And it's just as popular as Social Security.
3. Welfare benefits are a drag on the economy
Critics bemoan the amounts of aid being lavished on lower-income Americans, making dubious claims about thousands of dollars going to every poor family.
But despite an ever-growing need for jobs and basic living necessities, federal spending on poverty programs is a small part of the budget, and it's been that way for almost 50 years, increasing from 0.8 percent of GDP in 1962 to 1.2 percent of GDP in 2007.
Temporary Assistance for Needy Families (TANF) has dropped significantly over the past 15 years, leaving benefit levels far below the poverty line for most families. Ninety percent of the available benefits go to the elderly, the disabled, or working households.
For each family, current federal budgets pay about $400 per month for food, housing, and traditional 'welfare' programs. Food stamp recipients get $4.30 a day.
4. The American Dream is still alive -- if you just work hard
The Horatio Alger tale has been a popular one for conservatives, but the OECD, the Economic Policy Institute, and the National Journal all came to the same conclusion: the future earnings of a child in the U.S. is closely correlated to the earnings of his or her parents. This lack of mobility is more prevalent in the U.S. than in almost all other OECD countries.
Only 4 percent of those raised in the bottom quintile make it to the top quintile as adults. Only about 20 percent even make it to the top half.
A big part of the problem is the severe degree of poverty for our nation's children. According to UNICEF, among industrialized countries only Romania has a higher child poverty rate than the United States. Just in the last ten years the number of impoverished American children increased by 30 percent.
Not unexpectedly, it's much worse for minorities. While 12 percent of white children live in poverty, 35 percent of Hispanic children and 39% of black children start their lives in conditions that make simple survival more important than the American Dream. 80 percent of black children who started in or near the top half of U.S. income levels experienced downward mobility later in life.
5. Prison puts away the bad guys
Despite a falling violent crime rate in the U.S., there are now, as noted by Adam Gopnik, "more people under 'correctional supervision' in America -- more than six million -- than were in the Gulag Archipelago under Stalin at its height."
Incredibly, almost half of the inmates in federal prisons were jailed for drug offenses. Between 1980 and 2003, the number of drug offenders in prison or jail increased by 1100% from 41,100 in 1980 to 493,800 in 2003.
Outrageously, African Americans constituted 53.5 percent of all persons who entered prison because of a drug conviction. In the nation's largest cities, drug arrests for African Americans rose at three times the rate for whites from 1980 to 2003.
In Washington, D.C., it is estimated that three out of four young black men will serve time in prison. In New York, with 50,000 marijuana arrests per year, 90% are black or Latino. In Seattle, the 8% black population accounts for 60 percent of the arrests. Over the last ten years Colorado police have arrested Latinos at 1.5 times the rate of whites, and blacks at over 3 times the rate of whites. Newly passed marijuana laws reflect the beginnings of a backlash.
Perversely, this is all happening as studies by the Substance Abuse and Mental Health Services Administration find that both black and Hispanic adolescents use drugs LESS than the general population, and as a study by the National Institute of Health shows that the prevalence of marijuana use in colleges and universities was highest for white students.
The Greatest Misconception: The rich are being "soaked"
Redistribution has not spread the wealth, it has concentrated the wealth. Conservative estimates say the richest 1% have doubled their share of America's income in 30 years. It's worse. From 1980 to 2006, the richest 1% actually TRIPLED their share of after-tax income.
The real problem is tax avoidance: lost revenue from tax expenditures (deferrals and deductions), corporate tax avoidance, and tax haven losses could pay off the entire deficit. But the very rich refuse to pay. They have their own safety net in the House of Representatives.
By Paul Buchheit
Mitt Romney said he wasn't concerned about the very poor, because they have a safety net. This is typical of the widespread ignorance about inequality in our country. Struggling Americans want jobs, not handouts, and for the most part they've paid for their "safety net." The real problem is at the other end of the wealth gap.
How many people know that out of 150 countries, we have the 4th-highest wealth disparity? Only Zimbabwe, Namibia, and Switzerland are worse.
It's not just economic inequality that's plaguing our country. It's lack of opportunity. It's a dismissal of poor people as lazy, or as threats to society. More than any other issue over the next four years, we need to address the growing divide in our nation, to tone down our winner-take-all philosophy, to provide job opportunities for people who want to contribute to society.
Here are some of the common misconceptions:
1. Americans believe that the poorest 40 percent own about 10% of the wealth.
Most people greatly underestimate the level of inequality in our country, guessing that the poorest 40 percent own about 10% of the wealth, when in reality they own much less than 1% of the wealth. Out of every dollar, they own a third of a penny.
Factor in race, and it gets worse. Much of minority wealth exists in home values. But housing crashed, while the financial wealth owned almost entirely (93% of it) by the richest quintile of Americans has rebounded to lofty pre-recession levels.
As a result, for every dollar of NON-HOME wealth owned by white families, people of color have only one cent. Median wealth for a single white woman is over $40,000. For black and Hispanic women it is a little over $100.
2. Entitlements are the problem
No, they're not. The evidence is overwhelming. Social Security is a popular and well-run program. As summarized by Bernie Sanders, "Social Security, which is funded by the payroll tax, has not contributed one nickel to the deficit and, according to its trustees, can pay 100 percent of all benefits owed to every eligible American for the next 21 years." Dean Baker calls it "perhaps the greatest success story of any program in US history."
Medicare, which is largely without the profit motive and the competing sources of billing, is efficiently run, for all eligible Americans. According to the Council for Affordable Health Insurance, medical administrative costs as a percentage of claims are about three times higher for private insurance than for Medicare. And it's just as popular as Social Security.
3. Welfare benefits are a drag on the economy
Critics bemoan the amounts of aid being lavished on lower-income Americans, making dubious claims about thousands of dollars going to every poor family.
But despite an ever-growing need for jobs and basic living necessities, federal spending on poverty programs is a small part of the budget, and it's been that way for almost 50 years, increasing from 0.8 percent of GDP in 1962 to 1.2 percent of GDP in 2007.
Temporary Assistance for Needy Families (TANF) has dropped significantly over the past 15 years, leaving benefit levels far below the poverty line for most families. Ninety percent of the available benefits go to the elderly, the disabled, or working households.
For each family, current federal budgets pay about $400 per month for food, housing, and traditional 'welfare' programs. Food stamp recipients get $4.30 a day.
4. The American Dream is still alive -- if you just work hard
The Horatio Alger tale has been a popular one for conservatives, but the OECD, the Economic Policy Institute, and the National Journal all came to the same conclusion: the future earnings of a child in the U.S. is closely correlated to the earnings of his or her parents. This lack of mobility is more prevalent in the U.S. than in almost all other OECD countries.
Only 4 percent of those raised in the bottom quintile make it to the top quintile as adults. Only about 20 percent even make it to the top half.
A big part of the problem is the severe degree of poverty for our nation's children. According to UNICEF, among industrialized countries only Romania has a higher child poverty rate than the United States. Just in the last ten years the number of impoverished American children increased by 30 percent.
Not unexpectedly, it's much worse for minorities. While 12 percent of white children live in poverty, 35 percent of Hispanic children and 39% of black children start their lives in conditions that make simple survival more important than the American Dream. 80 percent of black children who started in or near the top half of U.S. income levels experienced downward mobility later in life.
5. Prison puts away the bad guys
Despite a falling violent crime rate in the U.S., there are now, as noted by Adam Gopnik, "more people under 'correctional supervision' in America -- more than six million -- than were in the Gulag Archipelago under Stalin at its height."
Incredibly, almost half of the inmates in federal prisons were jailed for drug offenses. Between 1980 and 2003, the number of drug offenders in prison or jail increased by 1100% from 41,100 in 1980 to 493,800 in 2003.
Outrageously, African Americans constituted 53.5 percent of all persons who entered prison because of a drug conviction. In the nation's largest cities, drug arrests for African Americans rose at three times the rate for whites from 1980 to 2003.
In Washington, D.C., it is estimated that three out of four young black men will serve time in prison. In New York, with 50,000 marijuana arrests per year, 90% are black or Latino. In Seattle, the 8% black population accounts for 60 percent of the arrests. Over the last ten years Colorado police have arrested Latinos at 1.5 times the rate of whites, and blacks at over 3 times the rate of whites. Newly passed marijuana laws reflect the beginnings of a backlash.
Perversely, this is all happening as studies by the Substance Abuse and Mental Health Services Administration find that both black and Hispanic adolescents use drugs LESS than the general population, and as a study by the National Institute of Health shows that the prevalence of marijuana use in colleges and universities was highest for white students.
The Greatest Misconception: The rich are being "soaked"
Redistribution has not spread the wealth, it has concentrated the wealth. Conservative estimates say the richest 1% have doubled their share of America's income in 30 years. It's worse. From 1980 to 2006, the richest 1% actually TRIPLED their share of after-tax income.
The real problem is tax avoidance: lost revenue from tax expenditures (deferrals and deductions), corporate tax avoidance, and tax haven losses could pay off the entire deficit. But the very rich refuse to pay. They have their own safety net in the House of Representatives.
Billionaires Crap Out in 2012 Elections
Original Link: http://www.creators.com/opinion/jim-hightower/billionaires-crap-out-in-2012-elections.html
By Jim Hightower
They came. They spent! Then, they limped home, tails between their legs. (OK, they didn't limp; they were flown home on their private Gulfstream jets. But still, their tails were tucked down in the defeat mode.)
"They" are the far-right corporate billionaire extremists who tried to become America's presidential kingmakers this year. Unleashed by the Supreme Court's Citizens United edict allowing unlimited sums of cash in our elections, they spewed an ocean of money into efforts to enthrone Mitt Romney in the White House and turn the Senate into a GOP rubber stamp for totally corporatizing government.
On election night, they gathered at exclusive Romney victory parties, but the celebratory mood quickly soured, for key states were choosing Democrats. The people were speaking, and (damn them) they seemed to be deliberately voting against the barons.
Take casino baron Sheldon Adelson, for example. He became the 2012 caricature of an obscene billionaire trying to buy democracy. Adelson rolled the political dice on eight candidates, betting more than $60 million — and crapped out on all of them.
Also, the uber-arrogant Koch boys, Charles and David, amassed some $200 million from their corporate vault and from other billionaires to knock out President Obama. But at evening's end, there the president stood, re-elected by a majority of voters and winning with more than 56 percent of the electoral votes.
And Bob Perry, another self-serving, ultra-rightist billionaire dumped $21 million into GOP Super PACs trying to win senate races in Florida and Virginia, as well as the presidency. All for naught.
Democrats not only gained two seats in the Senate, but new senators such as Elizabeth Warren, Tammy Baldwin and Mazie Hirono are expected to make the Senate more populist and much feistier. Heidi Heitkamp, Joe Donnelly, Chris Murphy and Martin Heinrich are expected to make the Senate more progressive than it has been (admittedly a low standard) and less likely to support the kleptocracy the barons so dearly hoped to establish.
Of course, the billionaires aren't through. They reckon that the roughly one billion bucks they put up this year just wasn't enough firepower. So look for even more obscene spending in 2014 and 2016.
Meanwhile, let's check in on the premier political bagman for moneyed corporations: Karl Rove. You know it's been a good election night when he has a hissy fit on national television.
It came at just past 11p.m., after he heard a TV network declare Obama the winner in Ohio.
This was not just any network; it was Fox, the Republican Party's official propaganda machine! Rove, who is a rabidly partisan GOP politico and fundraiser, also doubles as an expert "analyst" for Fox. (Proof again that this network has amputated the word "conflict" from the ethical concept of "conflict of interest." But I digress.)
Rove was sitting just off-camera on the Fox set when the on-air anchor team made the call on Ohio.
In fact, he was on his cellphone at the time with a top Romney staffer who was wailing that Fox was wrong, that Romney was winning Ohio. With his right knee jerking furiously, Rove demanded to be put on the air to rebut the network's own professional vote counters. He got what he wanted, publicly chiding his Fox colleagues for being "premature." This prompted an unusual moment of dead air, after which anchor Megyn Kelly said, "Well, that's awkward." Since every news outlet and even Republican Party officials were by then conceding Ohio (and the presidency) to Obama, Kelly asked whether Rove was using his own math just to "make himself feel better."
Bingo! Karl the Kingmaker was having a really bad night. In the past year, he had talked assorted corporations and fat cats into putting some $256 million into his attack ads against Democrats, assuring the donors that their money and his political genius would put the White House and the Senate in GOP hands. He came up a bit short. For example, American Crossroads, one of Rove's two political funds, spent $103 million to defeat Democratic Senate candidates, but the return on that investment was a pathetic 1 percent. Billionaires expect quite a bit better, so Rove had some explaining to do and some crow to eat.
By the way, in response to this brouhaha, Jon Stewart of Comedy Central's "The Daily Show" said, "'Math You Do As a Republican To Make Yourself Feel Better' is a much better slogan than the one Fox has now." But again, I digress.
To be fair to the Karlmeister, his 1 percent return on the money he handled is not atypical of the secretive Republican political funds in this election. The U.S. Chamber of Commerce laid out $31 million in dark money and got a 5 percent return on their funders' investment. Worse, the National Rifle Association surreptitiously invested $11 million in several Republicans — and got zero return.
As a researcher for the Sunlight Foundation, an independent watchdog group, put it: "It may mean people really don't like big money in politics."
By Jim Hightower
They came. They spent! Then, they limped home, tails between their legs. (OK, they didn't limp; they were flown home on their private Gulfstream jets. But still, their tails were tucked down in the defeat mode.)
"They" are the far-right corporate billionaire extremists who tried to become America's presidential kingmakers this year. Unleashed by the Supreme Court's Citizens United edict allowing unlimited sums of cash in our elections, they spewed an ocean of money into efforts to enthrone Mitt Romney in the White House and turn the Senate into a GOP rubber stamp for totally corporatizing government.
On election night, they gathered at exclusive Romney victory parties, but the celebratory mood quickly soured, for key states were choosing Democrats. The people were speaking, and (damn them) they seemed to be deliberately voting against the barons.
Take casino baron Sheldon Adelson, for example. He became the 2012 caricature of an obscene billionaire trying to buy democracy. Adelson rolled the political dice on eight candidates, betting more than $60 million — and crapped out on all of them.
Also, the uber-arrogant Koch boys, Charles and David, amassed some $200 million from their corporate vault and from other billionaires to knock out President Obama. But at evening's end, there the president stood, re-elected by a majority of voters and winning with more than 56 percent of the electoral votes.
And Bob Perry, another self-serving, ultra-rightist billionaire dumped $21 million into GOP Super PACs trying to win senate races in Florida and Virginia, as well as the presidency. All for naught.
Democrats not only gained two seats in the Senate, but new senators such as Elizabeth Warren, Tammy Baldwin and Mazie Hirono are expected to make the Senate more populist and much feistier. Heidi Heitkamp, Joe Donnelly, Chris Murphy and Martin Heinrich are expected to make the Senate more progressive than it has been (admittedly a low standard) and less likely to support the kleptocracy the barons so dearly hoped to establish.
Of course, the billionaires aren't through. They reckon that the roughly one billion bucks they put up this year just wasn't enough firepower. So look for even more obscene spending in 2014 and 2016.
Meanwhile, let's check in on the premier political bagman for moneyed corporations: Karl Rove. You know it's been a good election night when he has a hissy fit on national television.
It came at just past 11p.m., after he heard a TV network declare Obama the winner in Ohio.
Rove was sitting just off-camera on the Fox set when the on-air anchor team made the call on Ohio.
In fact, he was on his cellphone at the time with a top Romney staffer who was wailing that Fox was wrong, that Romney was winning Ohio. With his right knee jerking furiously, Rove demanded to be put on the air to rebut the network's own professional vote counters. He got what he wanted, publicly chiding his Fox colleagues for being "premature." This prompted an unusual moment of dead air, after which anchor Megyn Kelly said, "Well, that's awkward." Since every news outlet and even Republican Party officials were by then conceding Ohio (and the presidency) to Obama, Kelly asked whether Rove was using his own math just to "make himself feel better."
Bingo! Karl the Kingmaker was having a really bad night. In the past year, he had talked assorted corporations and fat cats into putting some $256 million into his attack ads against Democrats, assuring the donors that their money and his political genius would put the White House and the Senate in GOP hands. He came up a bit short. For example, American Crossroads, one of Rove's two political funds, spent $103 million to defeat Democratic Senate candidates, but the return on that investment was a pathetic 1 percent. Billionaires expect quite a bit better, so Rove had some explaining to do and some crow to eat.
By the way, in response to this brouhaha, Jon Stewart of Comedy Central's "The Daily Show" said, "'Math You Do As a Republican To Make Yourself Feel Better' is a much better slogan than the one Fox has now." But again, I digress.
To be fair to the Karlmeister, his 1 percent return on the money he handled is not atypical of the secretive Republican political funds in this election. The U.S. Chamber of Commerce laid out $31 million in dark money and got a 5 percent return on their funders' investment. Worse, the National Rifle Association surreptitiously invested $11 million in several Republicans — and got zero return.
As a researcher for the Sunlight Foundation, an independent watchdog group, put it: "It may mean people really don't like big money in politics."
Sunday, November 11, 2012
Social Security: It Ain't Broke
Original Link: http://www.otherwords.org/articles/social_security_it_aint_broke
By Elizabeth Rose
It's a basic part of what makes America run, like our national highway system.
Social Security is more popular than sliced bread. And it should be. Our Social Security system is the foundation of our families' security: We work hard and pay into it with every paycheck so each of us can retire with dignity.
Social Security is a basic part of what makes America run, like our national highway system. And with pensions vanishing, it's more important now than ever. Without Social Security, nearly half of elderly Americans would live below the official poverty level.
Social Security doesn't add a single penny to the deficit and never has. And it ain't broke. The good news is that Americans can count on our Social Security system for decades to come. There's already a massive trust fund with a growing $2.7 trillion surplus in the safest investments in the world.
Keeping Social Security strong into the next century is simple: Close the tax loopholes that make middle-class Americans pay at a higher rate than millionaires do. Under current law, workers making a middle-class income pay a portion of their income into Social Security at a much higher rate than the richest of us. Instead, we can have every worker pay the same rate.
Yes, people are living longer. Isn't that good news? Let's make sure that we have decent retirement income. Given the extreme market volatility that's grown routine, Americans clearly can't count on stocks or real estate to guarantee our retirement. Americans should save for retirement, in addition to relying on our Social Security benefits. Average Social Security earnings are only $14,000 per year, which still provides two-thirds of income for a typical senior and more than 90 percent of the income for a third of seniors.
Polls, including surveys dating back six decades, consistently show that an overwhelming majority of Americans strongly supports Social Security. And yes, it's a government program. If you think you don't like the government and you like Social Security, then think again.
By Elizabeth Rose
It's a basic part of what makes America run, like our national highway system.
Social Security is more popular than sliced bread. And it should be. Our Social Security system is the foundation of our families' security: We work hard and pay into it with every paycheck so each of us can retire with dignity.
Social Security is a basic part of what makes America run, like our national highway system. And with pensions vanishing, it's more important now than ever. Without Social Security, nearly half of elderly Americans would live below the official poverty level.
Social Security doesn't add a single penny to the deficit and never has. And it ain't broke. The good news is that Americans can count on our Social Security system for decades to come. There's already a massive trust fund with a growing $2.7 trillion surplus in the safest investments in the world.
Keeping Social Security strong into the next century is simple: Close the tax loopholes that make middle-class Americans pay at a higher rate than millionaires do. Under current law, workers making a middle-class income pay a portion of their income into Social Security at a much higher rate than the richest of us. Instead, we can have every worker pay the same rate.
Yes, people are living longer. Isn't that good news? Let's make sure that we have decent retirement income. Given the extreme market volatility that's grown routine, Americans clearly can't count on stocks or real estate to guarantee our retirement. Americans should save for retirement, in addition to relying on our Social Security benefits. Average Social Security earnings are only $14,000 per year, which still provides two-thirds of income for a typical senior and more than 90 percent of the income for a third of seniors.
Polls, including surveys dating back six decades, consistently show that an overwhelming majority of Americans strongly supports Social Security. And yes, it's a government program. If you think you don't like the government and you like Social Security, then think again.
Did Big Money really lose this election? Hardly
Original Link: http://www.southernstudies.org/2012/11/did-big-money-really-lose-this-election-hardly.html
By Chris Kromm
After the most money-drenched elections in history -- with close to $6 billion spent on the 2012 presidential and Congressional races alone, by one estimate -- big donors and the media alike are now asking: Was it worth it?
It's a fair question, especially for the new breed of super PACs and other outside groups that unleashed $1 billion this cycle on federal races. More than $715 million of that came from conservative groups attacking President Obama, who handily won a second term, and Congressional Democrats, who only strengthened their grip in the Senate.
Democrats are now relishing stories of Republican strategist Karl Rove having to explain to donors how two groups he co-founded, American Crossroads and Crossroads GPS, spent more than $175 million but only won 12 out of the 45 federal races they targeted -- a dismal 27 percent success rate.
They're not alone: FreedomWorks for America, the Tea Party super PAC founded by former House Majority Leader Dick Armey (R-TX) spent $19 million and lost all of its top-tier Congressional races, including a $2.9 million effort to unseat Sen. Bill Nelson (D-FL).
But do these setbacks for the Republican super PACs mean that Big Money didn't have an impact in the 2012 elections? Did all that money just go to waste? Hardly.
WHAT'S THE BANG FOR THE BUCK?
First, let's step back and look at what money can (and can't) do in an election. For example, about $3 billion of election dollars go to air TV ads, which by all accounts are blunt political tools, expensive and inefficient in influencing elections.
As Daniel Adler of Rolling Stone noted in his valuable assessment of political ads earlier this year, TV ads don't seem to have an impact on most people, and whatever effects they do have are usually short-lived. So why do strategists still blow so much money on them? Because, as Adler concludes, "ads actually do work -- or work well enough, enough of the time."
The key is the audience: Ads seem to work best on voters who don't know much about the issues or candidates. This includes undecided voters, that small sliver of the electorate that comedian Steven Colbert joked "don’t think about what they want until they get right up to the register at McDonald’s."
According to Kathleen Hall Jamieson of the Annenberg Public Policy Center, data on TV ads in battleground states going back to 2000 suggests ads have changed the minds of some voters -- at least enough to influence, if not determine, the result.
Or as Joe Heim, political science professor at the University of Wisconsin-La Crosse, says: "[Political advertising] does have an impact, even if it’s a marginal one. And that marginal impact is worth it."
But ads are just one arrow in a political strategist's quiver -- and while they can move the needle of voter opinion, they can't erase other shortcomings. Equally important are the ground game of getting out the vote, the overall message a campaign projects, and, of course, who's running for office: American Crossroads spokesman Jonathan Collegio testily blamed their recent Senate losses on "sub-optimal candidate quality."
MONEY'S STATE-LEVEL INFLUENCE
The fact that TV ads are most effective with less-engaged voters might explain money's continuing influence in state and local races, which receive far less media exposure and voters may know even less about the candidates and issues.
As Facing South and The New Yorker showed, in 2010 an onslaught of outside spending in North Carolina by outside money groups led by Republican donor Art Pope was a key factor in fueling a historic GOP takeover of the state legislature.
That put N.C. Republicans in charge of the once-a-decade redistricting process, producing new maps which the John Locke Foundation -- which is largely funded by Pope's foundation -- readily admits were crucial to enabling the GOP to expand its power in the General Assembly in 2012.
Money's state-level influence in North Carolina continued this year, too. According to FollowNCMoney.org, a money-tracking website run by the Institute for Southern Studies, more than $14 million from super PACs and other outside groups poured into N.C. state races.
Of the top 10 spending groups in North Carolina -- which made up more than 90 percent of the $14 million total -- seven were Republican-leaning groups, who outspent their Democratic-leaning counterparts by more than a two-to-one margin.
And unlike the national super PACs, conservative spending groups in North Carolina enjoyed a much higher winning percentage: Of the 10 races that attracted the most outside money, nine ended in Republican victories. (As for Pope, he and his operatives are well-represented in the newly-elected GOP governor's transition team.)
Money may have had the most influence in the election for a N.C. Supreme Court seat -- a race where many voters didn't know much about the candidates beyond what they saw in ads. The race attracted an unprecedented $2.3 million in outside spending, 88 percent of which came from super PACs supporting conservative incumbent Paul Newby, including a last-minute attack ad described by one newspaper as sleazy. Despite trailing in the polls, Newby ended up winning with 51.9 percent of the vote.
As Facing South reported this week, money appears to have also been a factor in the GOP's capture of the Arkansas legislature for the first time in over a century; the billionaire Koch brothers had pledged to spend $1 million helping Republicans in the state. The Center for Public Integrity sees money also playing a big role in state races in Montana and Washington.
BIG MONEY: NOT GOING ANYWHERE
In other words, while a handful of rueful mega-donors may wish they'd kept their cash, the notion that Big Money spending was "nearly for naught" in 2012 doesn't hold up.
Indeed, the reality may be that super PACs are what helped keep the presidential race as close as it was. Vanderbilt University's Ad Rating Project -- one of the first systematic efforts to track the impact of TV ads -- found that Romney's August 2012 "Right Choice," attacking Obama (falsely) on welfare to work requirements, hit a nerve with independent voters.
And that doesn't include the larger impact of money on the political system. As Jamelle Bouie at The Washington Post notes, "the mere possibility that Super PACs may spend big in elections will change the landscape of American politics -- who runs, how they run, and what they run on -- in ways that are, at the moment, subtle and hard to predict."
Big Money may have suffered a few setbacks -- but it's not going anywhere. And chances are that in the next election cyce, the money arms race will be bigger than ever.
By Chris Kromm
After the most money-drenched elections in history -- with close to $6 billion spent on the 2012 presidential and Congressional races alone, by one estimate -- big donors and the media alike are now asking: Was it worth it?
It's a fair question, especially for the new breed of super PACs and other outside groups that unleashed $1 billion this cycle on federal races. More than $715 million of that came from conservative groups attacking President Obama, who handily won a second term, and Congressional Democrats, who only strengthened their grip in the Senate.
Democrats are now relishing stories of Republican strategist Karl Rove having to explain to donors how two groups he co-founded, American Crossroads and Crossroads GPS, spent more than $175 million but only won 12 out of the 45 federal races they targeted -- a dismal 27 percent success rate.
They're not alone: FreedomWorks for America, the Tea Party super PAC founded by former House Majority Leader Dick Armey (R-TX) spent $19 million and lost all of its top-tier Congressional races, including a $2.9 million effort to unseat Sen. Bill Nelson (D-FL).
But do these setbacks for the Republican super PACs mean that Big Money didn't have an impact in the 2012 elections? Did all that money just go to waste? Hardly.
WHAT'S THE BANG FOR THE BUCK?
First, let's step back and look at what money can (and can't) do in an election. For example, about $3 billion of election dollars go to air TV ads, which by all accounts are blunt political tools, expensive and inefficient in influencing elections.
As Daniel Adler of Rolling Stone noted in his valuable assessment of political ads earlier this year, TV ads don't seem to have an impact on most people, and whatever effects they do have are usually short-lived. So why do strategists still blow so much money on them? Because, as Adler concludes, "ads actually do work -- or work well enough, enough of the time."
The key is the audience: Ads seem to work best on voters who don't know much about the issues or candidates. This includes undecided voters, that small sliver of the electorate that comedian Steven Colbert joked "don’t think about what they want until they get right up to the register at McDonald’s."
According to Kathleen Hall Jamieson of the Annenberg Public Policy Center, data on TV ads in battleground states going back to 2000 suggests ads have changed the minds of some voters -- at least enough to influence, if not determine, the result.
Or as Joe Heim, political science professor at the University of Wisconsin-La Crosse, says: "[Political advertising] does have an impact, even if it’s a marginal one. And that marginal impact is worth it."
But ads are just one arrow in a political strategist's quiver -- and while they can move the needle of voter opinion, they can't erase other shortcomings. Equally important are the ground game of getting out the vote, the overall message a campaign projects, and, of course, who's running for office: American Crossroads spokesman Jonathan Collegio testily blamed their recent Senate losses on "sub-optimal candidate quality."
MONEY'S STATE-LEVEL INFLUENCE
The fact that TV ads are most effective with less-engaged voters might explain money's continuing influence in state and local races, which receive far less media exposure and voters may know even less about the candidates and issues.
As Facing South and The New Yorker showed, in 2010 an onslaught of outside spending in North Carolina by outside money groups led by Republican donor Art Pope was a key factor in fueling a historic GOP takeover of the state legislature.
That put N.C. Republicans in charge of the once-a-decade redistricting process, producing new maps which the John Locke Foundation -- which is largely funded by Pope's foundation -- readily admits were crucial to enabling the GOP to expand its power in the General Assembly in 2012.
Money's state-level influence in North Carolina continued this year, too. According to FollowNCMoney.org, a money-tracking website run by the Institute for Southern Studies, more than $14 million from super PACs and other outside groups poured into N.C. state races.
Of the top 10 spending groups in North Carolina -- which made up more than 90 percent of the $14 million total -- seven were Republican-leaning groups, who outspent their Democratic-leaning counterparts by more than a two-to-one margin.
And unlike the national super PACs, conservative spending groups in North Carolina enjoyed a much higher winning percentage: Of the 10 races that attracted the most outside money, nine ended in Republican victories. (As for Pope, he and his operatives are well-represented in the newly-elected GOP governor's transition team.)
Money may have had the most influence in the election for a N.C. Supreme Court seat -- a race where many voters didn't know much about the candidates beyond what they saw in ads. The race attracted an unprecedented $2.3 million in outside spending, 88 percent of which came from super PACs supporting conservative incumbent Paul Newby, including a last-minute attack ad described by one newspaper as sleazy. Despite trailing in the polls, Newby ended up winning with 51.9 percent of the vote.
As Facing South reported this week, money appears to have also been a factor in the GOP's capture of the Arkansas legislature for the first time in over a century; the billionaire Koch brothers had pledged to spend $1 million helping Republicans in the state. The Center for Public Integrity sees money also playing a big role in state races in Montana and Washington.
BIG MONEY: NOT GOING ANYWHERE
In other words, while a handful of rueful mega-donors may wish they'd kept their cash, the notion that Big Money spending was "nearly for naught" in 2012 doesn't hold up.
Indeed, the reality may be that super PACs are what helped keep the presidential race as close as it was. Vanderbilt University's Ad Rating Project -- one of the first systematic efforts to track the impact of TV ads -- found that Romney's August 2012 "Right Choice," attacking Obama (falsely) on welfare to work requirements, hit a nerve with independent voters.
And that doesn't include the larger impact of money on the political system. As Jamelle Bouie at The Washington Post notes, "the mere possibility that Super PACs may spend big in elections will change the landscape of American politics -- who runs, how they run, and what they run on -- in ways that are, at the moment, subtle and hard to predict."
Big Money may have suffered a few setbacks -- but it's not going anywhere. And chances are that in the next election cyce, the money arms race will be bigger than ever.
Crossroads' $175 Million Strikeout
Original Link: http://www.opensecrets.org/news/2012/11/despite-dropping-millions-crossroads-strikes-out.html
By Michelle Martinelli
Just because George W. Bush has been out of the White House for four years doesn't mean Karl Rove has stopped trying to influence who controls Washington.
Rove's super PAC, American Crossroads, took every advantage of limitless fundraising in the 2012 election cycle, while its affiliated 501(c)(4), Crossroads GPS, did the same without having to disclose its donors.
As a super PAC, American Crossroads was responsible for about $105 million of the total $631 million spent on independent expenditures by super PACs in the 2012 election cycle. It comes in second to Restore Our Future -- the super PAC that backed Republican presidential nominee Mitt Romney -- and is just ahead of Priorities USA Action, which supported President Barack Obama, among the top spending super PACs.
Crossroads GPS, the 501(c)(4) "social welfare" group, spent $70.8 million of its own.
But whether that money translated into wins is a different story.
In the presidential election, American Crossroads dropped $84.6 million opposing Obama and spent almost $5 million just in the last week, while Crossroads GPS reported spending $15.3 million of its own throughout the cycle. Although most of the two groups' funds were spent opposing Democratic candidates, they also threw in just more than $13 million supporting Romney.
Minus the millions spent against the president, American Crossroads and Crossroads GPS were invested heavily in congressional elections, spending the most in Senate races. Including Obama and Romney, American Crossroads spent money for or against 20 federal candidates in 14 races, while Crossroads GPS focused on 27 in 24 contests.
By our calculations, American Crossroads came out on the winning side in three of its 14 races, with one still too close to call -- that's about 21 percent. GPS did only slightly better, getting its desired outcome in just seven of the 24 elections it spent on; one contest also remains undecided. GPS' success rate comes to 29 percent.
By Michelle Martinelli
Just because George W. Bush has been out of the White House for four years doesn't mean Karl Rove has stopped trying to influence who controls Washington.
Rove's super PAC, American Crossroads, took every advantage of limitless fundraising in the 2012 election cycle, while its affiliated 501(c)(4), Crossroads GPS, did the same without having to disclose its donors.
As a super PAC, American Crossroads was responsible for about $105 million of the total $631 million spent on independent expenditures by super PACs in the 2012 election cycle. It comes in second to Restore Our Future -- the super PAC that backed Republican presidential nominee Mitt Romney -- and is just ahead of Priorities USA Action, which supported President Barack Obama, among the top spending super PACs.
Crossroads GPS, the 501(c)(4) "social welfare" group, spent $70.8 million of its own.
But whether that money translated into wins is a different story.
In the presidential election, American Crossroads dropped $84.6 million opposing Obama and spent almost $5 million just in the last week, while Crossroads GPS reported spending $15.3 million of its own throughout the cycle. Although most of the two groups' funds were spent opposing Democratic candidates, they also threw in just more than $13 million supporting Romney.
Minus the millions spent against the president, American Crossroads and Crossroads GPS were invested heavily in congressional elections, spending the most in Senate races. Including Obama and Romney, American Crossroads spent money for or against 20 federal candidates in 14 races, while Crossroads GPS focused on 27 in 24 contests.
By our calculations, American Crossroads came out on the winning side in three of its 14 races, with one still too close to call -- that's about 21 percent. GPS did only slightly better, getting its desired outcome in just seven of the 24 elections it spent on; one contest also remains undecided. GPS' success rate comes to 29 percent.
Of the top four congressional races the super PAC spent money on, every dollar went to attack the Democratic candidates. But all four of those Democrats came out victorious, including Florida Sen. Bill Nelson, the biggest target of the group's efforts. American Crossroads poured more than $4 million into that election in an attempt to help Rep. Connie Mack (R-Fla.) unseat the senior senator, whose margin of victory was 55 percent to 42 percent.
The super PAC's next biggest investment was in the battle for a Montana Senate seat. The group spent $1.8 million dollars to sway voters against incumbent Sen. Jon Tester -- who ultimately defeated Republican candidate Denny Rehberg by about four percentage points. Crossroads GPS also played a role in outside spending there, shelling out $3.3 million opposing Tester.
In addition to the two returning incumbents, American Crossroads failed to stop Joe Donnelly (D-Ind.) and Tammy Baldwin (D-Wisc.) from winning Senate seats, despite spending $1.4 million and $1.3 million against them, respectively, while Crossroads GPS threw in $4.7 million opposing Baldwin. In the Wisconsin race, American Crossroads also spent $1.3 million favoring Baldwin's Republican opponent, Tommy Thompson.
Overall, Crossroads GPS, the shadow money group, targeted 12 Senate candidates and 13 vying for the House. Aside from the $15.3 million spent against Obama, the next largest amount spent was $10.6 million against Democrat Tim Kaine, who defeated George Allen, 52.4 percent to 47.6 percent.
Although Crossroads GPS spent most of its money opposing Democratic candidates -- including winning Sen. Sherrod Brown (Ohio) and Senator-elect Heidi Heitkamp (N.D.) -- it shelled out $287,000 favoring two Republican Senate candidates: Rick Berg in North Dakota and Heather Wilson in New Mexico, who were both defeated.
It wasn't all a waste for Rove and his large-dollar donors. In the Nebraska Senate race, American Crossroads served up $992,000 opposing Democratic candidate Bob Kerrey, part of the overall $9 million in outside spending in that contest. GOP Senator-elect Deb Fischer will take over the Senate seat.
And Crossroads GPS was on the winning side in the Nevada Senate race after spending $6.7 million against Democrat Shelley Berkley, who lost by 1.2 percentage points to Republican incumbent Dean Heller. American Crossroads pitched in on that race as well, with $347,000.
Outside spending made up for the difference in fundraising in New York's 27th Congressional District race between Republican Chris Collins and Rep. Kathleen Hochul, who lost her bid for re-election with the help of Crossroads' $313,000 opposing her. The super PAC spent more than $688,000 overall on the New York race.
Rove was in denial on Tuesday night. But while this election cycle has shattered spending records and flooded the air waves with attack ads, it has also provided plenty of evidence that money doesn't dictate the result of every race.
The super PAC's next biggest investment was in the battle for a Montana Senate seat. The group spent $1.8 million dollars to sway voters against incumbent Sen. Jon Tester -- who ultimately defeated Republican candidate Denny Rehberg by about four percentage points. Crossroads GPS also played a role in outside spending there, shelling out $3.3 million opposing Tester.
In addition to the two returning incumbents, American Crossroads failed to stop Joe Donnelly (D-Ind.) and Tammy Baldwin (D-Wisc.) from winning Senate seats, despite spending $1.4 million and $1.3 million against them, respectively, while Crossroads GPS threw in $4.7 million opposing Baldwin. In the Wisconsin race, American Crossroads also spent $1.3 million favoring Baldwin's Republican opponent, Tommy Thompson.
Overall, Crossroads GPS, the shadow money group, targeted 12 Senate candidates and 13 vying for the House. Aside from the $15.3 million spent against Obama, the next largest amount spent was $10.6 million against Democrat Tim Kaine, who defeated George Allen, 52.4 percent to 47.6 percent.
Although Crossroads GPS spent most of its money opposing Democratic candidates -- including winning Sen. Sherrod Brown (Ohio) and Senator-elect Heidi Heitkamp (N.D.) -- it shelled out $287,000 favoring two Republican Senate candidates: Rick Berg in North Dakota and Heather Wilson in New Mexico, who were both defeated.
It wasn't all a waste for Rove and his large-dollar donors. In the Nebraska Senate race, American Crossroads served up $992,000 opposing Democratic candidate Bob Kerrey, part of the overall $9 million in outside spending in that contest. GOP Senator-elect Deb Fischer will take over the Senate seat.
And Crossroads GPS was on the winning side in the Nevada Senate race after spending $6.7 million against Democrat Shelley Berkley, who lost by 1.2 percentage points to Republican incumbent Dean Heller. American Crossroads pitched in on that race as well, with $347,000.
Outside spending made up for the difference in fundraising in New York's 27th Congressional District race between Republican Chris Collins and Rep. Kathleen Hochul, who lost her bid for re-election with the help of Crossroads' $313,000 opposing her. The super PAC spent more than $688,000 overall on the New York race.
Rove was in denial on Tuesday night. But while this election cycle has shattered spending records and flooded the air waves with attack ads, it has also provided plenty of evidence that money doesn't dictate the result of every race.
Bad day for super donors
Original Link: http://www.publicintegrity.org/2012/11/07/11782/bad-day-super-donors
By Rachael Marcus
Biggest contributors to super PACs in 2012 election backed losing candidates
Money can't buy happiness, nor can it buy an election, apparently.
The top donors to super PACs in 2012 did not fare well — casino magnate Sheldon Adelson, the No. 1 super PAC contributor with more than $53 million in giving, backed eight losers at this writing.
Adelson was top backer of the pro-Mitt Romney Restore Our Future super PAC, with $20 million in donations. Romney lost to President Barack Obama. In addition, Adelson's contributions to super PACs backing U.S. Senate candidates in Florida, Virginia and New Jersey were also for naught.
He was not the only conservative billionaire who had a bad night.
Contran Corp. CEO Harold Simmons, (No. 2), homebuilder Bob Perry (No. 3) and TD Ameritrade founder Joe Ricketts, (No.4), also bet on Romney. Collectively, the trio gave $13.4 million to Restore Our Future, and Ricketts’ super PAC, Ending Spending Action Fund, spent an additional $9.9 million helping Romney’s failed bid.
The super donor winner of the night was Newsweb Corp. CEO Fred Eychaner (No. 5). Eychaner gave $3.5 million to pro-Obama super PAC Priorities USA Action through the most recent filing period, which ended Oct. 17, according to Federal Election Commission records.
In Florida, Republican Rep. Connie Mack lost his challenge to the popular Democratic Sen. Bill Nelson, who won with 55 percent of the vote. Adelson gave $2 million to the pro-Mack super PAC Freedom PAC, and Simmons and Perry gave a combined $255,000 to the group.
The hotly contested Senate race in Virginia attracted $2.5 million from Adelson and Perry, both giving to Independence Virginia, the super PAC supporting former Republican Sen. George Allen. His opponent, Democratic Gov. Tim Kaine, won the seat with 52 percent of the vote.
Adelson also invested in the re-election of Rep. Allen West, R-Fla., in Florida’s 18th District, who was trailing in his battle with Democratic newcomer Patrick Murphy at this writing.
The casino billionaire’s $1 million to Patriot Prosperity, a New Jersey-specific super PAC supporting the Republican candidate for U.S. Senate, Joe Kyrillos, and the Republican candidate for U.S. House in the state’s 9th District, Rabbi Shmuley Boteach, also did not pay off.
During the primary season, Adelson’s $16.5 million in contributions to the super PAC Winning Our Future was not enough guide former House Majority Leader Newt Gingrich to a Republican presidential nomination, though it is credited with keeping him in the race longer than expected. Nor were Adelson’s contributions enough to help Texas Lt. Gov. David Dewhurst win the GOP primary for Texas Senate earlier this year, a cause to which gave at least a quarter-million dollars.
Adelson did score one point with his $2 million contribution that helped sink a Michigan ballot initiative seeking to enshrine collective bargaining in the state’s constitution. Adelson runs the only non-union casinos on the Las Vegas Strip.
Win-Loss Rundown:
(Giving to candidate-specific super PACs in the federal election)
Sheldon Adelson, Republican, $53.7 million*
*As of Oct. 17, 2012 for the 2011-2012 election cycle. Source: Center for Responsive Politics and Center for Public Integrity analysis of Federal Election Commission records. Totals include contributions from individuals, family members and corporations that are controlled by the individual super donor.
By Rachael Marcus
Biggest contributors to super PACs in 2012 election backed losing candidates
Money can't buy happiness, nor can it buy an election, apparently.
The top donors to super PACs in 2012 did not fare well — casino magnate Sheldon Adelson, the No. 1 super PAC contributor with more than $53 million in giving, backed eight losers at this writing.
Adelson was top backer of the pro-Mitt Romney Restore Our Future super PAC, with $20 million in donations. Romney lost to President Barack Obama. In addition, Adelson's contributions to super PACs backing U.S. Senate candidates in Florida, Virginia and New Jersey were also for naught.
He was not the only conservative billionaire who had a bad night.
Contran Corp. CEO Harold Simmons, (No. 2), homebuilder Bob Perry (No. 3) and TD Ameritrade founder Joe Ricketts, (No.4), also bet on Romney. Collectively, the trio gave $13.4 million to Restore Our Future, and Ricketts’ super PAC, Ending Spending Action Fund, spent an additional $9.9 million helping Romney’s failed bid.
The super donor winner of the night was Newsweb Corp. CEO Fred Eychaner (No. 5). Eychaner gave $3.5 million to pro-Obama super PAC Priorities USA Action through the most recent filing period, which ended Oct. 17, according to Federal Election Commission records.
In Florida, Republican Rep. Connie Mack lost his challenge to the popular Democratic Sen. Bill Nelson, who won with 55 percent of the vote. Adelson gave $2 million to the pro-Mack super PAC Freedom PAC, and Simmons and Perry gave a combined $255,000 to the group.
The hotly contested Senate race in Virginia attracted $2.5 million from Adelson and Perry, both giving to Independence Virginia, the super PAC supporting former Republican Sen. George Allen. His opponent, Democratic Gov. Tim Kaine, won the seat with 52 percent of the vote.
Adelson also invested in the re-election of Rep. Allen West, R-Fla., in Florida’s 18th District, who was trailing in his battle with Democratic newcomer Patrick Murphy at this writing.
The casino billionaire’s $1 million to Patriot Prosperity, a New Jersey-specific super PAC supporting the Republican candidate for U.S. Senate, Joe Kyrillos, and the Republican candidate for U.S. House in the state’s 9th District, Rabbi Shmuley Boteach, also did not pay off.
During the primary season, Adelson’s $16.5 million in contributions to the super PAC Winning Our Future was not enough guide former House Majority Leader Newt Gingrich to a Republican presidential nomination, though it is credited with keeping him in the race longer than expected. Nor were Adelson’s contributions enough to help Texas Lt. Gov. David Dewhurst win the GOP primary for Texas Senate earlier this year, a cause to which gave at least a quarter-million dollars.
Adelson did score one point with his $2 million contribution that helped sink a Michigan ballot initiative seeking to enshrine collective bargaining in the state’s constitution. Adelson runs the only non-union casinos on the Las Vegas Strip.
Win-Loss Rundown:
(Giving to candidate-specific super PACs in the federal election)
Sheldon Adelson, Republican, $53.7 million*
- Mitt Romney — loss
- Connie Mack (Florida Senate) — loss
- George Allen (Virginia Senate) — loss
- Allen West (House, Florida’s 18th) — too close to call, but leaning toward loss
- Joe Kyrillos (New Jersey Senate) — loss
- Shmuley Boteach (House, New Jersey’s 9th) — loss
- Newt Gingrich (GOP presidential primary) — loss
- David Dewhurst (GOP primary, Texas Senate) — loss
- Mitt Romney — loss
- Connie Mack (Florida Senate) — loss
- Rick Santorum (GOP presidential primary) — loss
- Newt Gingrich (GOP presidential primary) — loss
- Rick Perry (GOP presidential primary) — loss
- David Dewhurst (GOP primary, Texas Senate) — loss
- Orrin Hatch (GOP primary, Utah Senate) — win
- Mitt Romney — loss
- George Allen (Virginia Senate) — loss
- Connie Mack (Florida Senate) — loss
- Rick Perry (GOP presidential primary) — loss
- David Dewhurst (GOP primary, Texas Senate) — loss
- Mitt Romney — loss
- Barack Obama — win
*As of Oct. 17, 2012 for the 2011-2012 election cycle. Source: Center for Responsive Politics and Center for Public Integrity analysis of Federal Election Commission records. Totals include contributions from individuals, family members and corporations that are controlled by the individual super donor.
Koch's Americans for Prosperity Returns to "Issue" Ads
Original Link: http://www.prwatch.org/news/2012/10/11779/obama-no-longer-disastrous-kochs-americans-prosperity-returns-issue-advocacy
By Brendan Fischer
After a court decision in March required nonprofit groups running phony "issue ads" to disclose their donors, David Koch's Americans for Prosperity (AFP) shifted to ads expressly calling for President Obama's defeat in the November 2012 elections. At the time, they claimed the change in tactics was only because the president's record was "disastrous," but now that the decision has been overturned and AFP can again run issue ads while keeping their funders secret, they have reverted to their old strategy. Is it because the group no longer thinks the president's record is "disastrous?"
In March 2012, a federal court in VanHollen v FEC closed a loophole in federal campaign law and required nonprofit groups making "electioneering communications" -- issue ads running within 30 days of a primary and 60 days of a general election -- to disclose all donors of more than $1000. In response to the decision, dark money groups like AFP, Crossroads GPS, and the U.S. Chamber of Commerce stopped their "electioneering communications" and began running "independent expenditures" that expressly call for the election or defeat of a candidate.
In August, AFP Director Tim Phillips said the change in tactics was not to hide their funders, but because "given the president's disastrous record, we felt this was necessary." AFP spent around $30 million on independent expenditures over the summer.
This strategy allowed AFP and others to keep their donors secret under election law but potentially raised new issues under the tax code, since nonprofits are not supposed to have election activity as a primary purpose. In recent years, AFP and other nonprofits have avoided running afoul of the IRS by classifying their electioneering communications as "education," "lobbying," or "issue advocacy," rather than political activity. But as CMD reported, "once they shift to express advocacy" -- meaning the ads include an express call to vote for or against a candidate -- "they can no longer claim the ads are anything but political," says Lloyd Hitoshi Mayer, an associate dean and law professor at Notre Dame Law School. This would make it harder for these dark money groups to continue the charade that they are anything but political organizations disguised as nonprofits.
On September 18, 2012, the DC Court of Appeals reversed the Van Hollen decision and re-opened the door for nonprofits to air issue ads while keeping their donors secret. And AFP, Crossroads GPS, the U.S. Chamber and others have all returned to running issue ads.
Did AFP begin airing issue ads again because they no longer think Obama's policies are "disastrous?" Of course not. They are just doing whatever it takes to hide from the American people the identities of those who are trying to buy our elections.
By Brendan Fischer
After a court decision in March required nonprofit groups running phony "issue ads" to disclose their donors, David Koch's Americans for Prosperity (AFP) shifted to ads expressly calling for President Obama's defeat in the November 2012 elections. At the time, they claimed the change in tactics was only because the president's record was "disastrous," but now that the decision has been overturned and AFP can again run issue ads while keeping their funders secret, they have reverted to their old strategy. Is it because the group no longer thinks the president's record is "disastrous?"
In March 2012, a federal court in VanHollen v FEC closed a loophole in federal campaign law and required nonprofit groups making "electioneering communications" -- issue ads running within 30 days of a primary and 60 days of a general election -- to disclose all donors of more than $1000. In response to the decision, dark money groups like AFP, Crossroads GPS, and the U.S. Chamber of Commerce stopped their "electioneering communications" and began running "independent expenditures" that expressly call for the election or defeat of a candidate.
In August, AFP Director Tim Phillips said the change in tactics was not to hide their funders, but because "given the president's disastrous record, we felt this was necessary." AFP spent around $30 million on independent expenditures over the summer.
This strategy allowed AFP and others to keep their donors secret under election law but potentially raised new issues under the tax code, since nonprofits are not supposed to have election activity as a primary purpose. In recent years, AFP and other nonprofits have avoided running afoul of the IRS by classifying their electioneering communications as "education," "lobbying," or "issue advocacy," rather than political activity. But as CMD reported, "once they shift to express advocacy" -- meaning the ads include an express call to vote for or against a candidate -- "they can no longer claim the ads are anything but political," says Lloyd Hitoshi Mayer, an associate dean and law professor at Notre Dame Law School. This would make it harder for these dark money groups to continue the charade that they are anything but political organizations disguised as nonprofits.
On September 18, 2012, the DC Court of Appeals reversed the Van Hollen decision and re-opened the door for nonprofits to air issue ads while keeping their donors secret. And AFP, Crossroads GPS, the U.S. Chamber and others have all returned to running issue ads.
Did AFP begin airing issue ads again because they no longer think Obama's policies are "disastrous?" Of course not. They are just doing whatever it takes to hide from the American people the identities of those who are trying to buy our elections.
Saturday, November 10, 2012
California Elections Board Peels Back Layer of Dark Money Onion, Finds More Onion
Original Link: http://www.prwatch.org/news/2012/11/11845/california-elections-board-peels-back-layer-dark-money-onion-finds-more-onion
By Brendan Fischer
California's election board successfully compelled a "dark money" group that spent $11 million on ballot initiatives in that state to reveal the source of their funding -- but the donors are other dark money groups tied to the Koch brothers and Karl Rove's political machine. Those groups also don't disclose the source of their funds. California managed to peel back one layer of the dark money onion, but discovered little information about who is really bankrolling the operation -- they only found more of the dark money onion.
Under California law, nonprofit groups must disclose all donors who give for the purpose of funding political ads or activities. Some groups have avoided disclosure by claiming that all donations were raised for general purposes.
But the Commission wasn't buying ARL's claim that it had raised $11 million from donors who were not aware the money would be used to fund ads in the fight over these ballot issues, and asked the group to name its funders. When ARL refused, the Commission filed suit and won, and on Sunday the California Supreme Court rejected ARL's appeal and ordered the group to reveal its donors.
On Monday, ARL revealed that it had indeed received $11 million in contributions for the purpose of funding the ballot initiative activities. But the source of that contribution was another dark money nonprofit, Americans for Job Security (AJS). And to complicate things further, Americans for Job Security filtered its contribution through a third dark money group, the Center to Protect Patient Rights (CPPR). According to the Commission's press release, "Under California law, the failure to disclose this initially was campaign money laundering."
Both AJS and CPPR are intimately familiar with this kind of "campaign money laundering." In 2010, CPPR gave $4.8 million to AJS, which it spent on ads attacking Democrats. In 2012, AJS gave $11 million to CPPR, which it gave to ARL.
AJS lists its mailing address at a UPS drop box in Alexandria VA, but the group operates out of the same office building in Washington DC as Karl Rove's American Crossroads SuperPAC, the related Crossroads Media, as well as consultancies like the Black Rock Group and Target Point Consulting. AJS has reported spending $15.6 million on ads this election cycle (most of them attacking President Obama), but as CMD has reported, the total is likely higher. Some of its ad buys appear to be coordinating with Rove's Super PAC, American Crossroads -- in Pennsylvania, for instance, AJS spent $1.2 million on ads in Philadelphia at the same time American Crossroads spent the same amount on ads across the rest of the state. AJS has also paid the related Crossroads Media to produce and place its ads, and for an unknown reason has disbursed nearly $1 million directly to Crossroads GPS.
As first discovered by Open Secrets, CPPR gave AJS $4.8 million in 2010, according to its most recent IRS filings. CPPR's misleading name gives the impression it is concerned about healthcare but it actually appears to operate as a conduit for funding right-wing electoral operations. As a nonprofit, CPPR is not required to report its funders, but it must disclose its grant recipients -- and through those disclosures, it was revealed that CPPR gave $55 million in 2010 to a variety of nonprofit groups that in turn spent at least $46 million attacking Democrats in the 2010 elections.
As a 501(c)(4) nonprofit CPPR itself does not disclose its donors. But it does have ties to the billionaire Koch brothers.
CPPR's President Sean Noble has been described as a "Koch operative" affiliated with a number of Koch-connected political operations, and who in the runup to the 2010 elections met regularly with GOP strategists and Karl Rove's Crossroads groups to plot and coordinate that year's Republican electoral landslide. Noble has since been hired by Americans for Limited Government, another nonprofit organization which happens to be AJS's other known funder. Its IRS filings show it gave $250,000 to AJS in 2010.
Other individuals associated with the group also have Koch ties. Consultant Cheryl Hillen has raised at least $2.6 million for the organization and was formerly director of fundraising for David Koch's Citizens for a Sound Economy (which later split into Koch's Tea Party group Americans for Prosperity and Freedomworks, which is led by Dick Armey). One of CPPR's original directors, Heather Higgins, is chairwoman of the Independent Women's Forum, a climate change denialist group that has received Koch money and was previously run by a Koch lobbyist.
According to Ann Ravel, Chair of the California Fair Political Practices Commission, the case "demonstrates the need for reform to make sure true donors are disclosed and can't hide behind innocuous committee names."
By Brendan Fischer
California's election board successfully compelled a "dark money" group that spent $11 million on ballot initiatives in that state to reveal the source of their funding -- but the donors are other dark money groups tied to the Koch brothers and Karl Rove's political machine. Those groups also don't disclose the source of their funds. California managed to peel back one layer of the dark money onion, but discovered little information about who is really bankrolling the operation -- they only found more of the dark money onion.
California's Election Board Demands Transparency, Gets Smoke and Mirrors
The subject of the election board's action, Americans for Responsible Leadership (ARL), is an Arizona-based nonprofit organized under section 501(c)(4) of the tax code. ARL had made an $11 million donation to the Small Business Action Committee PAC (SBAC) in October, one of the largest single donations in the state this election cycle. The SBAC is opposing Proposition 30 (which would raise taxes) and Proposition 32 (which would prohibit labor unions from raising money for political activities through employees' voluntary payroll deductions). Common Cause-California filed a complaint with California's elections board, the California Fair Political Practices Commission, alleging that ARL failed to comply with the state's disclosure laws.Under California law, nonprofit groups must disclose all donors who give for the purpose of funding political ads or activities. Some groups have avoided disclosure by claiming that all donations were raised for general purposes.
But the Commission wasn't buying ARL's claim that it had raised $11 million from donors who were not aware the money would be used to fund ads in the fight over these ballot issues, and asked the group to name its funders. When ARL refused, the Commission filed suit and won, and on Sunday the California Supreme Court rejected ARL's appeal and ordered the group to reveal its donors.
On Monday, ARL revealed that it had indeed received $11 million in contributions for the purpose of funding the ballot initiative activities. But the source of that contribution was another dark money nonprofit, Americans for Job Security (AJS). And to complicate things further, Americans for Job Security filtered its contribution through a third dark money group, the Center to Protect Patient Rights (CPPR). According to the Commission's press release, "Under California law, the failure to disclose this initially was campaign money laundering."
Both AJS and CPPR are intimately familiar with this kind of "campaign money laundering." In 2010, CPPR gave $4.8 million to AJS, which it spent on ads attacking Democrats. In 2012, AJS gave $11 million to CPPR, which it gave to ARL.
Americans for Job Security, a "Trade Group" that Seems to Exist Only to Influence Elections
As the Center for Media and Democracy has reported, Americans for Job Security is officially registered as a 501(c)(6) nonprofit "trade association," like the drug industry trade group PhRMA, but AJS does not appear to advance the interests of any particular industry or trade. The group claims that as a 501(c)(6) "trade association," it raises funds not through donations earmarked for political ads, but from voluntary "membership dues," which the group's leaders decide on their own how to disburse -- allowing it to hide its donors by claiming none of the donations were made for the purpose of funding its election-related activities. But throughout its existence AJS has done little else besides influencing elections. In 2008 the Federal Elections Commission found "reason to believe" the group had violated election law by not registering as a political committee -- which would have required more disclosure -- but the FEC's Republican commissioners blocked any action against the group.AJS lists its mailing address at a UPS drop box in Alexandria VA, but the group operates out of the same office building in Washington DC as Karl Rove's American Crossroads SuperPAC, the related Crossroads Media, as well as consultancies like the Black Rock Group and Target Point Consulting. AJS has reported spending $15.6 million on ads this election cycle (most of them attacking President Obama), but as CMD has reported, the total is likely higher. Some of its ad buys appear to be coordinating with Rove's Super PAC, American Crossroads -- in Pennsylvania, for instance, AJS spent $1.2 million on ads in Philadelphia at the same time American Crossroads spent the same amount on ads across the rest of the state. AJS has also paid the related Crossroads Media to produce and place its ads, and for an unknown reason has disbursed nearly $1 million directly to Crossroads GPS.
Koch-Connected CPPR Gave to AJS in 2010
Though AJS does not disclose its donors, two funding sources have been identified from disclosures filed by contributing organizations. And one of them is the Center to Protect Patient's Rights (CPPR).As first discovered by Open Secrets, CPPR gave AJS $4.8 million in 2010, according to its most recent IRS filings. CPPR's misleading name gives the impression it is concerned about healthcare but it actually appears to operate as a conduit for funding right-wing electoral operations. As a nonprofit, CPPR is not required to report its funders, but it must disclose its grant recipients -- and through those disclosures, it was revealed that CPPR gave $55 million in 2010 to a variety of nonprofit groups that in turn spent at least $46 million attacking Democrats in the 2010 elections.
As a 501(c)(4) nonprofit CPPR itself does not disclose its donors. But it does have ties to the billionaire Koch brothers.
CPPR's President Sean Noble has been described as a "Koch operative" affiliated with a number of Koch-connected political operations, and who in the runup to the 2010 elections met regularly with GOP strategists and Karl Rove's Crossroads groups to plot and coordinate that year's Republican electoral landslide. Noble has since been hired by Americans for Limited Government, another nonprofit organization which happens to be AJS's other known funder. Its IRS filings show it gave $250,000 to AJS in 2010.
Other individuals associated with the group also have Koch ties. Consultant Cheryl Hillen has raised at least $2.6 million for the organization and was formerly director of fundraising for David Koch's Citizens for a Sound Economy (which later split into Koch's Tea Party group Americans for Prosperity and Freedomworks, which is led by Dick Armey). One of CPPR's original directors, Heather Higgins, is chairwoman of the Independent Women's Forum, a climate change denialist group that has received Koch money and was previously run by a Koch lobbyist.
Shell Game Highlights Need for Reform
This week, with Americans for Responsible Leadership forced to disclose its funding to California's elections board, it is apparent that the flow of some of the money has now been reversed. Where in 2010 donors gave secretly to the Center to Protect Patient's Rights, which in turn gave secretly to Americans for Job Security, in 2012 donors apparently have given secretly to Americans for Job Security, which gave secretly to the Center to Protect Patient's Rights. CPPR then gave $11 million to Americans for Responsible Leadership, which in turn made an $11 million donation to the Small Business Action Committee PAC.According to Ann Ravel, Chair of the California Fair Political Practices Commission, the case "demonstrates the need for reform to make sure true donors are disclosed and can't hide behind innocuous committee names."
Koch Network Alone To Spend More To Defeat Obama In 2012 Than McCain Raised In All Of 2008
Original Link: http://www.republicreport.org/2012/koch-mccain-obama/
by Lee Fang
We’ve warned before that 2012 will be the greatest election bought and sold. Now, Politico is reporting that outside groups are preparing to spend upwards of $1 billion this year to defeat President Obama and elect more big business-friendly lawmakers to Congress.
To put these numbers in perspective, the Koch network alone — the political machine headed by plutocrats David and Charles Koch and funded by other billionaires — plans to spend more money this year than every dollar raised by John McCain’s campaign in 2008:
by Lee Fang
We’ve warned before that 2012 will be the greatest election bought and sold. Now, Politico is reporting that outside groups are preparing to spend upwards of $1 billion this year to defeat President Obama and elect more big business-friendly lawmakers to Congress.
To put these numbers in perspective, the Koch network alone — the political machine headed by plutocrats David and Charles Koch and funded by other billionaires — plans to spend more money this year than every dollar raised by John McCain’s campaign in 2008:
Republican super PACs and other outside groups shaped by a loose network of prominent conservatives – including Karl Rove, the Koch brothers and Tom Donohue of the U.S. Chamber of Commerce – plan to spend roughly $1 billion on November’s elections for the White House and control of Congress, according to officials familiar with the groups’ internal operations.Much of the money will be difficult to trace. The Federal Elections Commission only requires spending reports for ads aired within 60 days of the general election or 30 days of a primary. Big business groups have grown adept at exploiting loopholes so their spending is difficult to trace. For instance, the American Chemistry Council is currently engaged in a multimillion dollar ad campaign — yet not a dime of it appears on the FEC website. Moreover, groups like the Koch network use various foundations and nonprofit entities to avoid disclosing how much they spend, and where the money comes from. Republic Report was the first to discover $55 million in secret attack efforts coordinated by the Koch machine in 2010 — but our discovery was on May 19, 2012, two years after the election, and questions still linger relating to who helped the Koch brothers raise the cash.
That total includes previously undisclosed plans for newly aggressive spending by the Koch brothers, who are steering funding to build sophisticated, county-by-county operations in key states. POLITICO has learned that Koch-related organizations plan to spend about $400 million ahead of the 2012 elections – twice what they had been expected to commit.
Just the spending linked to the Koch network is more than the $370 million that John McCain raised for his entire presidential campaign four years ago. And the $1 billion total surpasses the $750 million that Barack Obama, one of the most prolific fundraisers ever, collected for his 2008 campaign.
Charts: How Much Have the Kochs Spent on the 2012 Election?
Original Link: http://www.motherjones.com/politics/2012/11/charts-map-koch-brothers-2012-spending
By Dave Gilson
See how much the billionaire brothers have spent in your state—and why the size of their campaign to beat Obama is a mystery.
Charles and David Koch arguably have been liberals' biggest bogeymen of the 2012 election. Just as conservatives have come to see George Soros as the mastermind of a shadowy leftist network, the billionaire brothers have become synonymous with the dark-money machine working to defeat Barack Obama. By their own admission, the Kochs have been raising millions to sway voters. At a closed-door gathering of like-minded megadonors in 2011, Charles Koch declared that the upcoming election would be a battle "for the life or death of this country" and that "we gotta do better than" the president's expected $1 billion war chest.
So just how much money have the brothers poured into the election? That's a tricky question, as we'll see in a moment. But first, how much are the Kochs, their companies, and Americans for Prosperity (the dark money group they're connected to) known to have spent so far? Click on a state for a detailed breakdown.
In total, Koch Industries and its affiliates Georgia-Pacific and Flint Hills Resources have given more than $2.2 million to candidates and parties during this election cycle. Koch Industries recently asserted that its support for candidates "is not based on party affiliation, and we support both Republicans and Democrats who support market-based policies and solutions." Yet 95 percent of its corporate donations in 2011 and 2012 have gone to Republicans. Charles and David Koch have given a combined total of $411,000 to federal and state candidates and parties during this election cycle, all of it to Republicans.
Those figures establish the Kochs and their companies as significant, but not extraordinary, conservative donors. That's where the accounting of their actual influence becomes tricky. As mentioned above, the Kochs have committed to raising millions to defeat Obama. However, most (if not all) of that money is going to outside-spending groups that don't have to disclose their donors. The primary vehicle for this spending is Americans for Prosperity, a nonprofit that operates a foundation (started by David Koch in 2004) and a 501(c)(4) that has played an active role in the Wisconsin recall election and has been running anti-Obama ads across the country. The Kochs say there is no link between AFP's two sides, yet the Center for Responsive Politics reports that they share staff and overhead costs. The Obama campaign has accused AFP of being a "front group."
So far, AFP has disclosed $36.7 million in election spending, 95 percent being spent against Obama. That includes $12.6 million on ads in key markets including swing states such as Ohio, Pennsylvania, and Nevada. (It doesn't include what AFP has spent on promotions such as giving away reduced-cost gas to "highlight Obama's failing energy policies.)
Just how much the Kochs have given AFP or other dark-money groups is unknown. Earlier this year, the Huffington Post reported that Charles Koch has pledged to give $40 million to unseat Obama while David Koch has pledged $20 million. (Their friends and allies have also pledged to help them raise additional millions.) Neither brother has donated to super-PACs (which must disclose their donors), so presumably that money has gone to dark-money groups such as AFP. Which means that the $411,000 in disclosed donations is just the tip of an iceberg of undisclosed campaign money.
The $60 million the Kochs have reportedly vowed to spend isn't much when you consider their total wealth. Each brother is worth an estimated $31 billion, according to Forbes, giving them a joint spot as America's fourth richest individuals.
Charles and David Koch aren't the only Koch brothers to have backed up their political beliefs with big money. Their sibling William has given $2.75 million to Restore Our Future, the main pro-Romney super-PAC. (The donations were given directly by his company, Oxbow Carbon.) He is not part of Koch Industries and has not been involved in his brothers' political fundraising efforts. He's worth $4 billion, and like his brothers, he has plenty of money for his passions—though politics may be one of his less expensive ones.
UPDATE: What about George Soros, you ask? The liberal financier and 12th-richest American has spent $2.6 million during this election cycle; $2.5 million of that has gone to four liberal super-PACs. Some of those groups, such as Priorities USA Action, the main pro-Obama super-PAC, have disclosed more spending than Americans for Prosperity. According to the New York Times, he was also going to give $1 million to America Votes, a liberal super-PAC/501(c)(4) outfit. Even if he made that undisclosed gift, unless Soros is matching the Kochs in under-the-radar spending, they're in an entirely different league of megadonors.
Correction: An earlier version article stated that Charles and David Koch have donated more than $628,000 to candidates and parties in 2011 and 2012. They have donated $411,000.
By Dave Gilson
See how much the billionaire brothers have spent in your state—and why the size of their campaign to beat Obama is a mystery.
Charles and David Koch arguably have been liberals' biggest bogeymen of the 2012 election. Just as conservatives have come to see George Soros as the mastermind of a shadowy leftist network, the billionaire brothers have become synonymous with the dark-money machine working to defeat Barack Obama. By their own admission, the Kochs have been raising millions to sway voters. At a closed-door gathering of like-minded megadonors in 2011, Charles Koch declared that the upcoming election would be a battle "for the life or death of this country" and that "we gotta do better than" the president's expected $1 billion war chest.
So just how much money have the brothers poured into the election? That's a tricky question, as we'll see in a moment. But first, how much are the Kochs, their companies, and Americans for Prosperity (the dark money group they're connected to) known to have spent so far? Click on a state for a detailed breakdown.
In total, Koch Industries and its affiliates Georgia-Pacific and Flint Hills Resources have given more than $2.2 million to candidates and parties during this election cycle. Koch Industries recently asserted that its support for candidates "is not based on party affiliation, and we support both Republicans and Democrats who support market-based policies and solutions." Yet 95 percent of its corporate donations in 2011 and 2012 have gone to Republicans. Charles and David Koch have given a combined total of $411,000 to federal and state candidates and parties during this election cycle, all of it to Republicans.
Those figures establish the Kochs and their companies as significant, but not extraordinary, conservative donors. That's where the accounting of their actual influence becomes tricky. As mentioned above, the Kochs have committed to raising millions to defeat Obama. However, most (if not all) of that money is going to outside-spending groups that don't have to disclose their donors. The primary vehicle for this spending is Americans for Prosperity, a nonprofit that operates a foundation (started by David Koch in 2004) and a 501(c)(4) that has played an active role in the Wisconsin recall election and has been running anti-Obama ads across the country. The Kochs say there is no link between AFP's two sides, yet the Center for Responsive Politics reports that they share staff and overhead costs. The Obama campaign has accused AFP of being a "front group."So far, AFP has disclosed $36.7 million in election spending, 95 percent being spent against Obama. That includes $12.6 million on ads in key markets including swing states such as Ohio, Pennsylvania, and Nevada. (It doesn't include what AFP has spent on promotions such as giving away reduced-cost gas to "highlight Obama's failing energy policies.)
Just how much the Kochs have given AFP or other dark-money groups is unknown. Earlier this year, the Huffington Post reported that Charles Koch has pledged to give $40 million to unseat Obama while David Koch has pledged $20 million. (Their friends and allies have also pledged to help them raise additional millions.) Neither brother has donated to super-PACs (which must disclose their donors), so presumably that money has gone to dark-money groups such as AFP. Which means that the $411,000 in disclosed donations is just the tip of an iceberg of undisclosed campaign money.The $60 million the Kochs have reportedly vowed to spend isn't much when you consider their total wealth. Each brother is worth an estimated $31 billion, according to Forbes, giving them a joint spot as America's fourth richest individuals.Charles and David Koch aren't the only Koch brothers to have backed up their political beliefs with big money. Their sibling William has given $2.75 million to Restore Our Future, the main pro-Romney super-PAC. (The donations were given directly by his company, Oxbow Carbon.) He is not part of Koch Industries and has not been involved in his brothers' political fundraising efforts. He's worth $4 billion, and like his brothers, he has plenty of money for his passions—though politics may be one of his less expensive ones.
UPDATE: What about George Soros, you ask? The liberal financier and 12th-richest American has spent $2.6 million during this election cycle; $2.5 million of that has gone to four liberal super-PACs. Some of those groups, such as Priorities USA Action, the main pro-Obama super-PAC, have disclosed more spending than Americans for Prosperity. According to the New York Times, he was also going to give $1 million to America Votes, a liberal super-PAC/501(c)(4) outfit. Even if he made that undisclosed gift, unless Soros is matching the Kochs in under-the-radar spending, they're in an entirely different league of megadonors.
Correction: An earlier version article stated that Charles and David Koch have donated more than $628,000 to candidates and parties in 2011 and 2012. They have donated $411,000.
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