“Because Corporations Lie”: Voluntary Political Transparency Is Just Not Enough
The Securities and Exchange Commission took a bold step in considering new rules that would require publicly traded companies to disclose political donations. This is a good idea because since the Citizens United decision, corporate entities have moved away from disclosed campaign committees, and instead have begun funneling cash into secret campaign funds, mostly 501c nonprofits.
Last year, The Nation published an investigation that debunked the idea that corporate money has flowed mostly to so-called Super PACs in the wake of Citizens United. Rather, big business has embraced nonprofit trade associations and issue advocacy groups to pour hundreds of millions into direct campaign advocacy. The distinction is important because Super PACs, for all their problems, at least disclose their donors and spending records; trade associations and issue advocacy groups do not.
To the credit of reformers, particularly the Center for Political Accountability and several investor groups, many large corporations have voluntarily adopted transparency measures. While we should applaud corporations that go beyond the letter of the law in disclosing these funds, a system based on voluntary participation does not come close to solving the problem of secret political slush funds. In some cases, voluntary disclosure actually obscures the truth.
Take health insurance companies. Aetna, Aflac and WellPoint are among several that have adopted voluntary disclose rules to provide the public and shareholders with a window into their giving patterns. There’s one problem: they aren’t truthful.
In 2009, the major health insurers, including the aforementioned companies, secretly funneled over $86.2 million to the US Chamber of Commerce, a trade association, using another trade association as a proxy to move the money, to run television and radio advertisements against health reform. Aetna’s disclosures that year only revealed $100,000 to the Chamber. WellPoint and Aflac failed to report those donations, as well. The following year, during the midterm elections, Aetna again secretly provided $7 million to “American Action Network,” a social welfare nonprofit used to run partisan attack ads against Democrats, along with the Chamber, which spent over $50 million on a partisan campaign to elect mostly Republicans that year. Again, Aetna’s voluntary disclosure report made no mention of the money, which became public through an inadvertent regulatory filing.
Similarly, several major oil companies have adopted voluntary disclosure guidelines that are fairly useless. ExxonMobil and Valero Energy are two examples: Both firms proudly produce annual reports on which candidates and political parties they fund. The problem? That data can be found already on the Federal Elections Commission website and related state-level disclosure websites, so there’s nothing new. As The Nation has reported, oil companies often work through secretive trade associations like the American Petroleum Institute, which has become more active in financing campaign-related advertisements and grants to other dark money groups.
As Senator John McCain and others have noted, the hundreds of millions slushing in secret money is bound to lead to another major scandal. And that scandal will likely to produce a lot of liability for the corporations involved. Moreover, as attorney Jerry Goldfeder noted in a letter to the New York Times this week, the I.R.S. has sent a questionnaire to 1,300 nonprofit groups questioning their tax exempt status. The increased scrutiny could lead to new questions that could increase liability for corporations: Are these groups being used to violate the Foreign Corrupt Practices Act, by funneling cash to foreign governments? Are consumer brands secretly funding ads that could harm the perception of their product (as was the case with Target and their donations to an anti-gay politician in Minnesota)?
Under the current system, only corporate executives, their lobbyists, and certain politicians really understand where the money is flowing. Shareholders, the public, and reporters have a right to know, too.
By: Lee Fang, The Nation, March 29, 2013
“Affirmative Action”: An Imperfect But Essential Way To Deal With A Persistently Unfair And Unequal Landscape
In all the well-justified furor over the Supreme Court’s review of voting rights and marriage equality issues, it’s easy to forget that when this term’s opinion roll out, the odds are high that the Court will strike a major blow against affirmative action programs for college admissions.
We are all familiar with the ideological dimensions of the affirmative action issues. But we have an original piece up on the website today, from Elias Vlanton, a distinguished public-school teacher in Maryland, that cuts through the hype and compellingly addresses the human element of affirmative action, and why it is an imperfect but essential way to deal with a persistently unfair and unequal landscape for college admissions. Here’s a sample:
Tramon, Morganne, Arnetta, and Anngie were all students of mine in Advanced Placement classes at Maryland’s Bladensburg High School . Bladensburg is neither a private school, nor a “we skim the cream of the crop” magnet public school. It is in one of Washington, DCs poorest suburbs, where family income ranks in the bottom quarter of the state, and a school where less than ten percent of any graduating class makes it through college.
This semester, while Morganne proudly posts videos of her next dissection and Anngie writes another long essay in French, the Supreme Court, in deciding Fisher v. University of Texas at Austin, will determine whether my students deserve to attend the colleges where they are being so successful. In addition to attending a low-performing high school, my kids are all African American and Latino. They were accepted into their elite colleges as part of those schools’ commitment to the mission of promoting diversity in higher education, the very diversity that affirmative action attempts to encourage—and that Fisher seeks to declare unconstitutional….
My four freshmen—my odds-beaters—had SAT scores hundreds of points below the average of the students admitted to their colleges. They took far fewer AP courses, and participated in fewer extra-curricular activities (since our school offers few activities other than sports). What set them apart was their class rank: they were all in the top two percent of the senior class, a function of their love of learning, their desire to do well, and their hard work to rise to the top. Despite the claim that, on the merits of their applications, they were “unqualified” for admission to the schools where they are getting As and Bs, all will graduate with honors from schools that are among the best in the country—joining my former students who graduated from Bowdoin College, Johns Hopkins University, Georgetown University, and Stanford University .
So Chief Justice Roberts, in the end, we agree: Discrimination is discriminatory. That is why colleges must be allowed to consider the social and economic circumstances of my students when making admissions decisions—as Bryn Mawr, Cornell, Dartmouth, and Middlebury have done. My kids don’t want a leg up; but neither do they deserve a kick in the chest.
Vlanton’s passionate essay is a reminder that while so many agonize over the “injustice” of affirmative action, our country is doing a terrible job (as Kevin Carey documented in his article in the January/February issue of the Washington Monthly) of providing anything like equal opportunity in higher education.
Yes, affirmative action programs are flawed, but not half a flawed as the “color-blind” system that will be left in place if affirmative action is discarded and something more systemic is not put in its place.
By: Ed Kilgore, Contributing Writer, Washington Monthly Political Animal, March 29, 2013
“The Dead End That Is Public Opinion”: Action Works Best When It Makes Politicians Afraid
As the effort to enact new gun legislation hobbles along, liberals have noted over and over that in polls, 90 percent or so of the public favors universal background checks. In speaking about this yesterday, President Obama said, “Nothing is more powerful than millions of voices calling for change.” Then Jonathan Bernstein explained that opinion doesn’t get political results, what gets results is action. I’d take this one step farther: what gets results is not action per se, but action that produces fear. I’ll explain in a moment, but here’s part of Bernstein’s argument:
See, the problem here is equating “90 percent in the polls” with “calling for change.” Sure, 90 percent of citizens, or registered voters, or whoever it is will answer in the affirmative if they’re asked by a pollster about this policy. But that’s not at all the same as “calling for change.” It’s more like…well, it is receiving a call. Not calling.
Those people who have been pushing for marriage equality? They were calling for change. And marching for it, demanding it, donating money to get it, running for office to achieve it and supporting candidates who would vote for it, filing lawsuits to make it legal. In many cases, they based their entire political identity around it.
Action works. “Public opinion” is barely real; most of the time, on most issues, change the wording of the question and you’ll get entirely different answers. At best, “public opinion” as such is passive. And in politics, passive doesn’t get results.
Politicians are constantly assessing public opinion in ways both formal (polls) and informal (talking to folks, reading the paper, etc.). From their perspective, opinion is complex and multi-dimensional. It has a direction, an intensity, and a relationship to action. It can’t be reduced to one number. And the most important question for them is when opinion can turn into something that threatens them. Right now, that 90 percent figure doesn’t seem to be making too many politicians scared.
If you’re an interest group or a voting bloc, it’s far, far better to be feared than loved. If a politician loves you, he’ll say, “Hey guys, you know I love you, but you’re just going to have to wait on this priority of yours. I promise we’ll get around to addressing it next year.” If a politician fears you, he’ll say, “OK! OK! I’ll do what you want, just don’t hurt me!” The NRA has understood this well, which is why it has spent years working to convince everyone that it can destroy any politician it chooses (as you know, I’ve argued at length that that image is a myth, but the myth’s existence is undeniable). It spends far less time convincing politicians that being in line with the NRA produces wonderful benefits. It’s basically a protection racket; when the local mobster comes into your shop and says, “Nice place you’ve got here. Shame if someone were to burn it down,” the shop owner doesn’t say, “At last! I’m so glad you came to keep me safe!” He isn’t happy about it, but he pays up.
So action works best when it actually makes politicians afraid. It’s a way of getting politicians’ attention, and convincing them that if they don’t go along, they might be risking their jobs. Right now, for instance, politicians in both the Democratic and Republican parties are becoming afraid to be on the wrong side on marriage equality. It isn’t just because of poll results showing a majority of the public in favor; that’s just a number, albeit a significant one. The reason they’re afraid is that they understand this is going to become a culturally defining issue that before long will have the power to end people’s careers. They fear that their position on marriage equality could come to define their entire identity, carrying with it a whole set of judgments people will make about them. You’re seeing all this movement now—Democrats coming out in favor of marriage equality, Republicans stumbling around without a clue as to where they should position themselves—because there’s a collective realization that this is a key moment. And they’re afraid. There’s no question that in the wake of Newtown, members of Congress are less afraid of the NRA than they have been in the past. But the real question is whether they’re afraid of not passing something like background checks. And the answer so far is, not yet they aren’t.
By: Paul Waldman, Contributing Editor, The American Prospect, March 29, 2013
“Poor People Don’t Just Disappear”: This Is What Happens When You Rip A Hole In The Safety Net
America’s social safety net, such as it is, has recently come under some scrutiny. Chana Joffe-Walt’s in-depth exploration of the increase in people getting Social Security Disability benefits at NPR got many listeners buzzing. Then in The Wall Street Journal, Damian Paletta and Caroline Porter looked at the increase in the use of food stamps, called SNAP. All three journalists look at the increasing dependence on these programs and come away puzzled: Why are so many people now getting disability and food stamp payments?
The answer is two-fold. Recent trends give us the first part of the explanation. Yes, as Paletta and Porter note, the economy is recovering and the unemployment rate is falling. But, as they recognize, the poverty rate is also rising. And therein lies the rub: people are getting jobs but staying poor. The available jobs are increasingly low-wage and don’t pay enough to live off of. And the big profits in the private sector haven’t led to an increase in wages.
GDP and employment may be doing well, but that hasn’t done much for those at the bottom of the totem pole. As the WSJ article points out, 48.5 million people were living in poverty in 2011, up from 37.3 million in 2007, a 30 percent increase. This is despite an unemployment rate that’s fallen off its peak. Some of the fall in the unemployment rate has been driven by people simply giving up on looking for a job altogether. But those who do get jobs are likely trading their once middle-class employment for low-wage work. The National Employment Law Project has found that mid-wage jobs have been wiped out during the recovery in favor of low-wage work: low paying jobs grew nearly three times as fast as mid-wage or high-wage work.
But there’s a deeper explanation that goes beyond the current economic picture. Aren’t there other programs for the increasing ranks of people living in poverty to turn to? Unfortunately, we’ve worked hard to weaken key parts of the safety net by changing how programs operate and then cutting back on their funds. Consequently, the number of people who are reached by programs for the poor has shrunk. But when you take away someone’s lifeline, they don’t stop needing it. So they either suffer hardship or find support elsewhere. What disability insurance and SNAP have in common is that they are fully funded by the federal government, which also can set the eligibility requirements. While states narrow eligibility requirements for TANF or unemployment insurance, the federal government can leave them (relatively) more open for SNAP and disability. That leaves them absorbing those who we’ve thrown off the rolls of other programs.
Unemployment benefits are where people turn when they lose a job and need income before getting back to work. But due to financial and other requirements, not everyone gets them. These rules vary state by state because states are in almost complete control of the program. They set their own eligibility criteria and benefit levels and are also on the hook for most of the funding for the benefits. As the Center on Budget and Policy Priorities reports, “the federal government pays only the administrative costs.”
Unlike the federal government, states have constrained budgets and most have to balance them every year. These budgets get even tighter in a downturn when people lose jobs and don’t pay as many taxes. On top of this, states have come under pressure from business groups during good times to reduce the contributions they use to fund the reserves that pay out benefits when things get tough. So many states have cut back on eligibility or benefit amounts in light of squeezed budgets. Given all of these constraints on benefits, only about a third of all children whose parents were unemployed at some point in 2011 actually saw any unemployment insurance benefits. They were far more likely to get food stamps, a federally funded program that has been much more flexible.
This story of a program financed by states that hasn’t been able to keep up with demand is the same for another huge part of the social safety net: welfare, or as we know it now, TANF. TANF does even worse than unemployment: it reaches just 10 percent of the children living with unemployment parents and just 30 percent of those living in poverty. The program used to do much better: in 1996, it reached 70 percent of poor families with children living in poverty. But then there was welfare reform, which turned it from a cost-sharing model to a block grant. Rather than the federal government sharing the costs with the states, the government now doles out lumps of cash and mostly lets states handle the rest. That lump doesn’t change even if the economy gets worse and more people live in poverty—and hasn’t even kept up with inflation.
While welfare reformers initially claimed victory as rolls fell during a booming 90s economy, the numbers have continued to fall even as jobs have disappeared. The poverty rate among families is back up to 1996 levels, but TANF’s caseload has fallen by 60 percent since then.
These families aren’t magically de-impoverished when they’re kicked off of government support programs. So they either go hungry or find other means of support. Enter SNAP and disability. SNAP has grown by 45 percent to meet increased need in the poor economy. The federal government was able to increase funding and waive some barriers to entering the program.
The CBPP reports that the growth in the use of disability insurance, on the other hand, is in large part due to demographic factors—an aging population and women’s increased entrance into the workforce—which accounts for half its growth since 1990. The elderly are far more likely to be disabled than younger workers, and more women workers means more workers who might become disabled. Other factors that contributed to its growth include the economic downturn. Joffe-Walt reports on how disability has dovetailed with welfare pruning its rolls. As she shows in two graphs, the number of low-income people on disability rose just as the number of families on welfare declined. Disability receipts also rise as unemployment rises. To qualify for disability, an applicant must have, as CBPP puts it, “little or no income and few assets”—which means that if unemployment and poverty rise, more people will fit this description. As Harold Pollack points out, “If you have a bad back, and the only jobs available are manual labor, that’s a real limitation. You’re unable to work. So it very much matters that we’re in a deep recession and a lot of the opportunities people faced are limited.”
Other than elderly disabled workers, those who sign up for disability are those who can’t even dream of finding a job that doesn’t require physical exertion and have no other income—thus leaving them with no where to turn but disability. After all, unemployment only lasts so long and TANF now comes with strict work requirements. Disability steps in when those with low education levels who live in communities based around industry—hard manual labor—lose their jobs and fall into poverty.
This is what happens when you burn enormous holes in the fabric of the social safety net: people either fall through or cling to the remaining parts. We can certainly debate whether we want food stamps and disability to carry so much of the burden of supporting the poor and vulnerable. In fact, this all seems to point to the simplest answer, which is to just hand money to those in poverty rather than funnel it through these different programs that may or may not actually meet people’s needs. But what we shouldn’t do is assume that food stamps and disability are bloated programs because so many people rely on them and then jump to cutting them back. Poor people don’t disappear just because we slash the programs they rely on. They still struggle to get by. That’s the lesson we should have learned over the past two decades.
By: Bryce Covert, The Nation, March 28, 2013
“So Much For Sincerity”: Republicans’ Hispanic Outreach Effort Off To A Rocky Start
In January, not long after President Barack Obama trounced Mitt Romney by 44 percent among Latino voters, the GOP-aligned Hispanic Leadership Network issued a new set of “tonally sensitive messaging points” for Republicans to use when engaging with Latino and Hispanic voters. The idea behind the memo seemed to be that, if Republicans won’t attract Hispanics with appealing policy proposals, they should at least try to stop driving them away with racially charged language.
Clearly, Representative Don Young (R-AK) didn’t get the message.
Congressman Young went disastrously off-script during an interview with Alaskan radio station KRBD, released Thursday, when he used a racial slur to describe the workers on his father’s ranch.
“My father had a ranch; we used to have 50-60 wetbacks to pick tomatoes,” Young said. “It takes two people to pick the same tomatoes now. It’s all done by machine.”
Quickly realizing that he had made a tremendous error, Young issued an apology of sorts late Thursday night.
“I used a term that was commonly used during my days growing up on a farm in central California,” Young said in a statement. “I know that this term is not used in the same way nowadays and I meant no disrespect.”
Putting aside the question of what context Young thinks could possibly make the term “wetback” acceptable—or for that matter, not disrespectful—his explanation clearly fails to undo the damage done by his offensive statement.
With an eye towards damage control, Republican leaders quickly blasted Young’s comments.
“Congressman Young’s remarks were offensive and beneath the dignity of the office he holds,” House Speaker John Boehner (R-OH) said in a statement. “I don’t care why he said it—there’s no excuse and it warrants an immediate apology.”
Republican National Committee chairman Reince Priebus concurred, saying “The words used by Representative Young emphatically do not represent the beliefs of the Republican Party,” adding, “Offensive language and ethnic slurs have no place in our public discourse.”
Indeed, it was Priebus who just last week released a report urging that “if we want ethnic minority voters to support Republicans, we have to engage them, and show our sincerity.” In just 10 days since that report, Young labeled Hispanic workers as wetbacks, Senate Republicans started a racially charged campaign against President Obama’s only Latino cabinet nominee, and North Carolina governor Pat McCrory unceremoniously shuttered his state’s Office of Hispanic/Latino affairs. And that’s not even touching the Conservative Political Action Conference, which featured birther jokes and a minority “outreach” panel arguing that slavery was good for black Americans.
So much for showing sincerity.
Ultimately, the biggest problem with the GOP’s minority outreach program is simple: Most Republicans seem to have very little interest in actually appealing to minority communities. Polling suggests that Hispanic voters align much more closely with Democrats than Republicans on a wide range of social and economic issues. But instead of working to find common ground on these policy splits, Republicans chose to simply soften their rhetoric — and they haven’t even done that successfully.
If Republican politicians cannot even uphold their own “stop using racial slurs” rule, then their chances of making real inroads with minority communities seem more remote than ever.
By: Henry Decker, The National Memo, March 28, 2013
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