Money and Politics This Week

Every Friday, the Brennan Center will be compiling the latest news concerning the corrosive nature of money in New York State politics—and the ongoing need for public financing and robust campaign finance reform. We’ll also be linking to dispatches from around the country highlighting the national scope of this crisis. This week’s links were contributed by Dan Rockoff.

For more stories on an ongoing basis, follow the Twitter hashtag #moNeYpolitics

NY Campaign Finance:

1. Today, over 100 organizations that support Fair Elections for New York wrote Governor Cuomo detailing the need for publicly financed campaigns, lower contribution limits, and better enforcement. The civil rights, business, faith, grassroots community, good government, environmental, and labor organizations who signed the letter, thanked the Governor for his strong support and expressed their enthusiasm to work with him and members of the Legislature to pass publicly financed elections and other campaign finance reforms during this legislative session.

2. Despite the annual $150,000 contribution limit by individuals to candidates in New York, luxury-apartment mogul Leonard Litwin gave almost $700,000 to candidates in 2011. A study by the New York Public Interest Research Group revealed that Litwin was the biggest individual donor in the state. Litwin was able to dodge the state’s campaign finance laws by utilizing the limited liability company (LLC) loophole, which allows companies to contribute multiple times through affiliated LLC’s, even when the LLC is completely controlled by a corporation or individual who has already reached the maximum contribution limit.

3. Governor Cuomo spoke with reporters about the need for public financing and campaign finance reform after participating in a fundraising event for the Democratic Governors Association. “One of the things we have to work on is getting money out of politics,” Cuomo said. In response to a reporter’s question about the meeting, Cuomo replied, “Your issue of, ‘You are in a room where people contribute money’ — that is the current state of politics and that is (the case for) every elected official in every fundraising forum.”

4. Manuel Ortega, law chairman of the Staten Island Democratic Party, filed a complaint with the FEC against Republican Representative Michael Grimm. The complaint alleges excessive and illegal cash contributions. A key fundraiser of Grimm’s is now being investigated for embezzling millions of dollars from a rabbi’s congregation. According to the New York Times story that Ortega used as the basis for his FEC complaint, unnamed followers allege that Grimm sought donations over the legal limit, and that he sought those donations in cash and from undocumented aliens.

5. The Democrat and Chronicle calls for Governor Cuomo to follow through on his election promises for public financing and campaign finance reform. The newspaper notes that “the governor continues to say the right things” and urges him to “prod the Legislature to deliver.”

Other News Nationwide:

1. In his State of the Union address, President Obama spoke about the “corrosive influence of money in politics.” He called for “a bill that bans insider trading by Members of Congress,” places limits on incumbents’ ability to own stocks in industries they impact, and restricts the ability of bundlers to lobby Congress.

2. The New York Times editorializes that under the federal lobbying law, “Newt Gingrich can legitimately claim that he is not a lobbyist.” The paper stated that Gingrich had “made a great deal of money in Washington peddling his influence, while carefully staying about half-an-inch short of the legal definition of lobbyist.” The paper calls for a better law limiting lobbyist activity and promoting disclosure. Part of the problem is that many Members of Congress use the revolving door—more than 400 former members have become lobbyists or consultants in the last decade.

3. In Massachusetts, Senator Scott Brown and likely Democratic opponent Elizabeth Warren agreed on a plan to stop outside groups from running negative ads. The agreement “requires each side to donate to a charity of the other’s choosing” when benefiting from a third-party ad, and also requires each side to write to outside groups and television station managers requesting a cease-fire. Brown, who is up for re-election to a full term, said that third-party ads “spend millions of dollars from anonymous donors portraying their opposition unfairly and misleading voters.” The question now is whether the agreement is enforceable.

4, In Montana, the State Supreme Court upheld by a 5-2 vote a law banning corporations from making political expenditures. A New York Times editorial praised the Montana Supreme Court, stating that “in Citizens United, the conservative majority turned itself into a copper kings’ court.” The majority rejected Justice Kennedy’s “misguided reasoning” that money does not “give rise to corruption or the appearance of corruption.” The court’s dissenters, however, argued that the Supreme Court’s Citizens United decision dictates the opposite result, and warned that the Supreme Court would not allow Montana to ignore precedent.

Former Representatives Voice Support for Public Financing

In a joint op-ed in today’s Times-Union, former New York State Congressmen Sherwood Boehlert and Scott Murphy voiced their support for Governor Cuomo’s plan to enact a system of public financing of elections, an issue he gave prominence in his State of the State address.

Speaking from their experiences as former members of Congress representing both major political parties, Boehlert and Murphy acknowledge the “corrosive role that private money plays in political campaigns and the legislative process,” both in Washington and Albany. The increased cost of running for office in New York means that candidates have to spend more and more time courting special interests to raise money for their campaigns. This has only contributed to Albany’s culture of dependence on big money.

The solution for our state: adopt a system of voluntary public financing of elections with matching funds like we have in New York City. If small donor contributions are matched on a 4-to-1 ratio, politicians would be able to spend less time raising money from lobbyists and special interests, and more time focusing on serving the interests of their constituents.

A recent Siena poll indicates that public financing of elections has broad support among both Republicans and Democrats in New York. Boehlert and Murphy have now added to the growing – and bipartisan – chorus of calls for meaningful campaign finance reform in Albany.

Money and Politics This Week

Every Friday, the Brennan Center will be compiling the latest news concerning the corrosive nature of money in New York State politics—and the ongoing need for public financing and robust campaign finance reform. We’ll also be linking to dispatches from around the country highlighting the national scope of this crisis. This week’s links were contributed by Matthew Ladd.

For more stories on an ongoing basis, follow the Twitter hashtag #moNeYpolitics

NY Campaign Finance News

1. Gov. Cuomo renewed his support for public campaign financing in New York in his recent State of the State address, calling on the legislature to send him a comprehensive campaign finance reform bill that includes public financing for state and legislative elections. The official text of Gov. Cuomo’s State of the State address can be found here.

2. As Nick Nyhart writes in the Huffington Post, New Yorkers support the public financing of campaigns by wide margin. A new poll conducted by the Siena Research Institute shows overwhelming support for public financing and lower contribution limits: a full 74% of those polled are in favor of public financing of state elections. Siena’s press release highlights campaign finance reform as one of the three proposals in the governor’s address that garnered the most support. The full results can be downloaded here.

3. The Lower Hudson Journal News has joined the latest call for campaign finance reform in New York, mentioning Gov. Cuomo’s backing of public financing of elections in his State of the State, and quoting a election official on the notorious laxity of the state’s campaign finance regime: “Unless you out-and-out stick it in your pocket and walk away, everything’s legal.” The editorial also cites a long litany of former elected officials who have dipped into their campaign accounts—often to pay attorneys hired to handle their legal troubles—for years after they stopped running for public office.

4. The Utica Observer-Dispatch issued a similar editorial on Wednesday, praising Gov. Cuomo for his remarks on public financing in his State of the State, and citing the Campaign Finance Institute on the many incentives that voluntary public financing creates for small donors.

5. NBC New York singled out Gov. Cuomo’s call for public campaign financing as a key point in his address, noting that 24 states already have some form of public financing for elections, that only a fraction of New York’s 19 million residents currently contribute to campaigns, and that campaign finance reform has been a crucial issue since the Pataki era.

6. Likewise, NPR’s New York affiliate reported on a new study by the Campaign Finance Institute, which found that New York is “dead last” in terms of political donations by the public—less than one half of one percent of the state’s population makes campaign contributions for state or legislative elections. Gov. Cuomo’s State of the State address cited the CFI’s research, which is available on the CFI website.

7. Union leaders have rallied around Gov. Cuomo’s promise to back public campaign financing, issuing a joint letter on behalf of the UAW (United Auto Workers), CWA (Communication Workers of America), and SEIU (Service Employees International Union) to express their support. “To have a truly just and equal society, we must have elections that reflect the will of the people, not the privilege of the wealthy few,” the letter states in part. “We need public funding of elections to achieve this goal.”

National Campaign Finance News

8. Citizens United is “the worst campaign finance decision in Supreme Court history,” according to an op-ed by Fred Wertheimer of Democracy 21 in Politico, in large part because it has unleashed an unprecedented wave of special-interest spending through the creation of super PACs. The op-ed emphasizes the need for a small-donor matching funds system that puts ordinary citizens at the forefront of campaign fundraising, among other legislative remedies such as better disclosure laws, a prohibition on candidate-specific super PACs, and the creation of a stronger enforcement agency to replace the failed FEC.

9. Mitt Romney’s repeated endorsement of Florida’s “Full Sail University,” a for-profit college whose curriculum includes an $80,000 program in “video game art,” has raised some eyebrows after revelations that Full Sail’s chief executive, Bill Heavener, is a major donor to Romney’s campaign as well as the super PAC run by Romney’s former aides. The New York Times also recounts how “Winning the Future,” the super PAC that shores up Newt Gingrich’s campaign, recently received a $5 million lifeline from billionaire casino owner and longtime Gingrich supporter Sheldon Adelson.

Kruger Used Campaign Contributions to Pay Legal Fees

New York’s notoriously weak campaign finance laws were highlighted this week as disclosure reports revealed that former Assemblyman Carl Kruger used nearly $1.4 million from his campaign funds to pay for his legal defense against federal corruption charges. While other states require that candidates set up a legal defense fund, New York allow candidates to use cash from campaign funds pay attorney’s fees.

Susan Lerner from Common Cause/NY notes that “when contributors give to a candidate, they want to support the candidate in his election campaign — not pay for his defense against fraud charges.”

Our former colleague, Ciara Torres-Spelliscy, has pointed out that lawmakers have taken advantage New York's laws by using campaign funds to pay for cars, cell phones, country clubs, sporting events tickets, legal bills, meals and even pet food.

Senator Liz Krueger introduced a bill last year that would address the misuse of campaign funds for personal purposes. Among other restrictions, S3053 would forbid the use campaign funds to “pay attorney’s fees or any costs of defending against any civil or criminal investigation or prosecution for alleged violations of state or federal law.”

Of course, this incident highlights only one of the many problems with our state’s campaign finance laws and we hope that it will be among those addressed when the promised campaign finance bill is introduced.