Justice Rising: Corporate Power or the Common Good?

Due out in October, the final issue of Justice Rising's series on "Money in Politics" will look at who runs US government. Is it the American people looking out for our common good or a corporate elite exerting control over public policy to benefit their private ends? Taking historic research by Gustavus Meyers, Thortstein Veblen and C. Wright Mills, this issue of Justice Rising will apply their analysis of "money power" to the twenty-first century. It will lay bare the disaster of a public policy driven by corporate allies in a time when the externalities of their market-driven rationales are causing extreme climate change as well as species and resource depletion-threatening life as we know it.

This important issue of Justice Rising will expose how the revolving door between corporate America and our government's top decision makers facilitates the monied elite's domination over Supreme Court decisions, our imperial foreign policy, and the daily workings of the regulatory system. It will also illuminate how our legislatures have been turned into training camps for corporate lobbyists.

In the tradition of Justice Rising, this issue will also promote the growing drive of the American people to exert democratic control over corporate power. From ending corporate personhood to creating a public service corps solidly loyal to the common good of the people, citizens are uniting to guarantee a future of liberty and justice for all.

A subscription to Justice Rising is free with Alliance for Democracy membership. For a free copy of this issue, email us in the Alliance office. Back issues of Justice Rising are available online, both as complete issues and individual articles.

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The return of clean elections?

A few days ago, NPR's On Point focused on campaign finance with guest Lawrence Lessig, who made a good point: overturning Citizens United does not ensure that politicians will operate free from the influence of the very small slice of the population who contribute mightily to political parties and to election and re-election campaigns. If the first step is to amend the Constitution to end corporate access to personhood rights and to allow the re-regulation of campaign finance, the second has to be setting up some kind of public financing program so that the decent candidates don't have to court the overprivileged to get into office, and to prevent the indecent candidates from using elected office as a "farm team for K Street."

You can hear the show online, and watch his slideshow here.

Then you can add your name to Jack Lohman's Change.org petition entitled Congress: Pass public funding of campaigns!!! Jack edits the newsletter ThrowTheRascalsOut.org.

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Five corporations that paid no 2009 taxes bought $8 million worth of candidate in 2010

NYC Public Advocate Bill De Blasio has turned the spotlight on corporations that pay no taxes while spending big bucks on political parties, candidates, PACs and the like.

From the Public Advocate website:

Public Advocate de Blasio’s analysis shows the top five recipients of corporate tax breaks avoided paying $3.7 billion in potential taxes in 2009, while also contributing more than $43.1 million to political campaigns over the last decade. During the 2009-2010 election cycle, the group of companies spent a combined $7.86 million in campaign contributions, a 7% jump over their 2007-2008 political spending.

In letters recently sent to Exxon-Mobil and four other corporations, the Public Advocate called on these companies to pledge this latest windfall will not be spent on electioneering. De Blasio is also urging consumers and shareholders to contact Exxon-Mobil’s General Counsel through www.advocate.nyc.gov/exxon to urge adoption of a proposed shareholder’s resolution calling for full disclosure of all corporate political spending.

De Blasio's focus on Exxon also spotlights increased spending by the oil and gas industry at a time of both record gas prices and record profits. During the last election cycle, oil and gas nabobs gave more than $30.5 million to federal level political interests, according to Center for Responsive Politics research. This amount includes more than $17.1 million from industry political action committees, nearly $11.4 million from individuals associated with the industry and more than $2 million in outside money the industry spent to independently promote or slam political candidates. Koch Industries, ExxonMobil and Chief Oil and Gas led the pack in spending, most of it going to the GOP or conservative "blue dog" Democrats.

The odds of Exxon/Mobil top management or any other corporate players ending the practice of investing in friendly elected officials just because the American people tell them to stop, is, admittedly, far fetched. But given how quiet many officials have been on the issue of political bribery, de Blasio deserves credit for making this issue the Public Advocate's business.

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Robert Reich: Why the Obama Tax Deal Confirms the Republican Worldview

Reich is right on the money when he writes that power and privilege at the top--not elected officials but the power of the people who fund their campaigns--make it impossible to write tax and social policy that benefits the nation as a whole. But political bribery is a bipartisan problem. It's a rare industry that doesn't drop cash on both sides of the aisle, which is why we need to clean up the system, not just switch the players.

by Robert Reich. Posted June 30 on The Huffington Post

Apart from its extraordinary cost and regressive tilt, the tax deal negotiated between the president and the Republicans has another fatal flaw.

It confirms the Republican worldview.

Americans want to know what happened to the economy and how to fix it. At least Republicans have a story--the same one they've been flogging for thirty years. The bad economy is big government's fault and the solution is to shrink government.

Here's the real story. For three decades, an increasing share of the benefits of economic growth have gone to the top 1 percent. Thirty years ago, the top got 9 percent of total income. Now they take in almost a quarter. Meanwhile, the earnings of the typical worker have barely budged.

The vast middle class no longer has the purchasing power to keep the economy going. (The rich spend a much lower portion of their incomes.) The crisis was averted before now only because middle-class families found ways to keep spending more than they took in--by women going into paid work, by working longer hours, and finally by using their homes as collateral to borrow. But when the housing bubble burst, the game was up.

The solution is to reorganize the economy so the benefits of growth are more widely shared. Exempt the first $20,000 of income from payroll taxes, and apply payroll taxes to incomes over $250,000. Extend Medicare to all. Extend the Earned Income Tax Credit all the way up through families earning $50,000. Make higher education free to families that now can't afford it. Rehire teachers. Repair and rebuild our infrastructure. Create a new WPA to put the unemployed back to work.

Pay for this by raising marginal income taxes on millionaires (under Eisenhower, the highest marginal rate was 91 percent, and the economy flourished). A millionaire marginal tax of 70 percent would eliminate the nation's future budget deficit. In addition, impose a small tax on all financial transactions (even a tiny one--one half of one percent--would bring in $200 billion a year, enough to rehire every teacher who's been laid off as well as provide universal preschool for all toddlers). Promote unions for low-wage workers.

But here's the obstacle. As income and wealth have risen to the top, so has political power. Money is being used to bribe politicians and fill the airwaves with misleading ads that block all of this.

The midterm elections offered dramatic evidence. NBC news reported shortly after Election Day, for example, that Crossroads GPS, one of the biggest Republican secret-money organizations, got "a substantial portion" of its loot from a group of extremely wealthy Wall Street hedge fund and private equity managers. Why would they sink so much money into the midterms? Because they've been so strongly opposed to a proposal by congressional Democrats to treat the earnings of hedge fund and private equity managers as ordinary income rather than capital gains (subject to only a 15 percent rate).

In other words, the problem isn't big government. It's power and privilege at the top.

So another part of the solution is to limit the impact of big money on politics. This requires, for example, publicly-financed campaigns, disclosure of all sources of political spending, and resurrection of the fairness doctrine for broadcasters.

It's the same power and privilege that got the Bush tax cuts in the first place, and claimed the lion's share of its benefits. The same power and privilege that got the estate tax phased out.

Get it? By agreeing to another round of massive tax cuts for the wealthy, the president confirms the Republican story. Cutting taxes on the rich while freezing discretionary spending (which he's also agreed to do) affirms that the underlying problem is big government, and the solution is to shrink government and expect the extra wealth at the top to trickle down to everyone else.

Obama's new tax compromise is not only bad economics; it's also disastrous from the standpoint of educating the public about what has happened and what needs to happen in the future. It reinforces the Republican story and makes mincemeat out of the truthful one Democrats should be telling.

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It's not a bribe, it's a contribution!

by Rachel Slajda. Posted on Talking Points Memo, November 24

A casino owner indicted on charges of bribery and honest services fraud is trying to get 11 of his 33 counts thrown out, arguing that campaign contributions don't count as bribery.

Federal prosecutors say that Milton McGregor, a businessman with controlling stakes in two Alabama casinos, hired lobbyists to bribe state politicians into supporting electronic gambling legislation. A fellow businessman, the lobbyists and four state legislators were also indicted in the sweep.

Prosecutors say McGregor and his alleged co-conspirators promised $100,000 in campaign contributions to one state senator and $2 million to another.

So McGregor filed a motion to dismiss 11 charges of defrauding voters of honest services, arguing that "'Honest Services' bribery does not include campaign contributions." He also argues that direct personal payments don't constitute bribes unless tied to a specific action.

His lawyers argued that their point is proved by the recent Skilling Supreme Court case, which dramatically narrowed the definition of honest services fraud and has the potential to reverse convictions in countless corruption cases. Defendants had for years complained that the definition of such fraud, "to deprive another of the intangible right of honest services," was too vague.

In Skilling, a case brought by former Enron president Jeffrey Skilling, the court ruled that prosecutors must prove that a defendant has committed "bribery or kickbacks," the so-called "core" of honest services. In other words, they had to prove a quid pro quo.

Prosecutors in the McGregor case disagreed with his lawyers, writing a scathing brief this week calling them flat-out "wrong" about Skilling, arguing that McGregor's alleged promises of campaign cash for certain votes falls well within the honest services core.

The case is being tried in federal district court in Alabama. A judge has not yet ruled on McGregor's motion.

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