“Just The Tip Of The Iceberg”: The Real Scandal With Tough-Guy Rep Michael Grimm
Rep. Michael Grimm (R-N.Y.), a two-term Staten Island congressman with stints in the Marines and FBI, grabbed our attention after President Obama’s State of the Union address on Tuesday night. More specifically, he grabbed NY1 reporter Michael Scotto after Scotto asked him about a bubbling campaign finance scandal, memorably uttering these words, caught on the rolling camera’s video (watch http://youtu.be/425ysh-24wo):
Let me be clear to you, you ever do that to me again I’ll throw you off this f—ing balcony…. You’re not man enough, you’re not man enough. I’ll break you in half. Like a boy. [NY1]
Alright, that’s probably a sentiment a lot of politicians have wanted to convey to a reporter. But now, thanks to Grimm’s threats, everybody knows that he is embroiled in, and touchy about, something to do with allegedly illegal campaign donations. Before we get to that story, Grimm decided to address his partial-on-camera outburst with this statement:
I was extremely annoyed because I was doing NY1 a favor by rushing to do their interview first in lieu of several other requests. The reporter knew that I was in a hurry and was only there to comment on the State of the Union, but insisted on taking a disrespectful and cheap shot at the end of the interview because I did not have time to speak off-topic. I verbally took the reporter to task and told him off because I expect a certain level of professionalism and respect, especially when I go out of my way to do that reporter a favor. I doubt that I am the first member of Congress to tell off a reporter, and I am sure I won’t be the last.
MSNBC’s Benjy Sarlin sarcastically cuts to the PR lesson:
Well this careful apology should ensure this Michael Grimm story goes away fast pic.twitter.com/vMymkxViuZ
But here’s the story Scotto was asking Grimm about in the Capitol rotunda: Last week, the FBI arrested Grimm’s fundraiser (and ex-girlfriend) Diana Durand on charges of illegally contributing more than $10,000 to Grimm’s 2010 campaign through straw donors. Here’s how the New York Daily News describes the alleged “donor swapping”:
The swapping works like this: A donor who gives the maximum to Candidate A then donates to Candidate B — and in return, a donor or friend of Candidate B gives an identical amount to Candidate A. [NY Daily News]
In one case described by the Daily News, Candidate A was Bert Mizusawa, a GOP House candidate in Virginia, and the maxed-out donor was Washington lawyer Bazil Facchina; Durand was the second alleged donor, and Grimm Candidate B. The newspaper said its review of 2010 federal campaign finance record found at least another 20 such transactions involving Grimm and fellow candidates in California, South Dakota, Illinois, and Virginia.
The Daily News investigation implicates Grimm personally in one questionable transaction, but he’s not listed in the Justice Department indictment. But Grimm has been under investigation for two years, and Durand is merely the newest wrinkle. In August, Ofer Biton — a former top aide to Israeli Orthodox Rabbi Yoshiyahu Pinto — pleaded guilty to visa fraud; in early 2012, The New York Times reported that Biton and Grimm allegedly sought illegal campaign donations from Pinto followers, including large cash contributions and donations from undocumented immigrants.
Even with those allegations, Grimm’s constituents re-elected him in 2012, 48 percent to 43 percent. He first won election in the GOP wave of 2010, unseating freshman Democrat Michael McMahon by about three points. But let’s face it, campaign finance violations fall into the category of “boring but important,” with an emphasis on boring. Threatening to murder a reporter with your bare hands? Not boring.
And that’s not even the most colorful story in Grimm’s recent past. (No, I’m not talking about this one.) In 2006, after leaving the FBI, he opened up a health food restaurant with an alleged mobster with ties to the Gambino crime family. And in 2011, Evan Ratliff wrote about FBI undercover operations in The New Yorker, including some eyebrow-raising allegations about Grimm from a New York City Police officer who was moonlighting as a bouncer. At the time, July 1999, Grimm was an FBI agent, apparently dating a married woman.
According to the NYPD officer, Gordon Williams, Grimm and the woman entered a nightclub in Queens, Caribbean Tropics, around midnight and ran into the woman’s estranged husband. Williams broke up the ensuing altercation, but says Grimm and the husband returned at 2:30 a.m. for a standoff in the club’s garage, with Grimm waving a gun around, screaming he was going to kill the guy, and saying: “I’m a fucking FBI agent, ain’t nobody going to threaten me.” Ratliff then recounts this epilogue:
Grimm left the club, but at 4 a.m., just before the club closed, he returned again, according to Williams, this time with another FBI agent and a group of NYPD officers. Grimm had told the police that he had been assaulted by the estranged husband and his friends. Williams said that Grimm took command of the scene, and refused to let the remaining patrons and employees leave. “Everybody get up against the fucking wall,” Williams recalled him saying. “The FBI is in control.” Then Grimm, who apparently wanted to find the man with whom he’d had the original altercation, said something that Williams said he’ll never forget: “All the white people get out of here.” [New Yorker]
Completely accurate or not (Grimm says not), that’s a pretty juicy story. And not many people would know about it if Grimm had kept his temper in check Tuesday night.
By: Peter Weber, The Week, January 29, 2014
“Unlimited Spending”: This Is How The Koch Brothers Plan To Win The U.S Senate
The Koch brothers* are hiring.
You’ll find job listings for campaign staff positions in Koch-funded groups in Arizona, California, Colorado, Florida, Louisiana, Minnesota, Nevada, New Hampshire, New Mexico, North Carolina, Ohio, Texas and Virginia. Some of the ads call for experts in social media channels such as Facebook, Twitter, Pandora, YouTube, Google, and OutBrain to effect a strategy that’s both agile and overwhelming.
And you’re already seeing $20 million worth of TV ads from the Koch-funded group Americans for Prosperity (AFP) targeting incumbent senators in Alaska, New Hampshire, North Carolina and Louisiana for supporting Obamacare. Similar ads are now up Michigan and Iowa, where veteran Democrats Carl Levin (D-MI) and Tom Harkin (D-IA) are vacating their Senate seats.
Now Democrats are sounding the alarm to their donors in a moment that’s reminiscent of the note the Obama campaign hit with an email in which the president said, “I will be outspent.”
“Democrats need money at this early stage in order to fight back against the limitless spending from the Kochs,” Guy Cecil, the executive director of the Democratic Senatorial Campaign Committee, told The New York Times. “The limitless spending from the Kochs means we need Democratic donors to step up in a bigger way immediately.”
Republicans need six seats to take over the U.S. Senate and the Kochs are trying to expand the map to put even the states that twice voted for President Obama in play. And they’re building on a model that they perfected in 2010 when right-leaning groups hammered the president and Democrats in Congress for a year over the “failed” stimulus before it even had a chance to work.
With Democrats holding virtually every swing seat in the nation after the landslide of 2008, they defended on all fronts and avoided trying to nationalize the race, even though the choice was made for them. As the midterm election hit, in the midst of the worst job market in 60 years, Republicans won more elected offices than they had at any time since before the Great Depression.
The right tried to reprise this strategy in 2012 with dismal results. But in an off-year election, without President Obama on the ballot and with Obamacare disapproval soaring in red states, there’s a clear opportunity to use health care reform to define Democrats early.
And that’s what the Kochs are doing wherever they see an opportunity.
With former Michigan Secretary of State Terri Lynn Land polling better than expected against her likely Democratic opponent Rep. Gary Peters (D-MI), especially in polls that under-sample African-Americans, Michigan presents such an opportunity. Land supported Rep. Paul Ryan (R-WI) in his plan to privatize Social Security and Medicare in previous budgets, but she’s unlikely to produce the sort of gaffes that cost Republicans Senate seats in Missouri, Indiana, Nevada and Rhode Island.
Land recently touted outside groups supporting her run right as AFP’s ad targeting her opponent began a $1 million three-week run — even though collaboration between candidates and these groups is illegal. Wink, wink.
Democrats also hope to expand the Senate map to Georgia — where Obama only lost by 8 percent without spending a dime in the state. Michelle Nunn, the daughter of the state’s former beloved senator Sam Nunn, will likely be the Democratic nominee and could easily end up facing Rep. Paul Broun (R-GA) who was voted “Most Likely to be the Next Akin.” His primary opponent, Rep. Jack Kingston (R-GA) — who recently said that children would benefit from working — was a close second to Broun.
While Karl Rove is actively trying to influence Republican primaries to ensure the most electable candidates win, Americans for Prosperity retains its Tea Party credibility by aiming its fire only at Democrats and sticking to the issue that will preoccupy the right for the third national election in a row — Obamacare.
So if you’re in one of those 13 targeted states, expect to hear about #fullrepeal of a law that’s been on the books for almost four years now on TV, Facebook, Twitter, Snapchat, email and anywhere the Kochs can find you.
*The Kochs go out of their way to obscure how they spend the millions they invest in Republican politics. Americans for Prosperity is a 501(c)(4) social welfare group that doesn’t have to release the names of its donors — though we know David Koch helped to found the group. These non-profits, which are limited in the amount of resources they can apply to political efforts, were the subject of the controversy where the IRS used political keywords to identify conservative and progressive groups for extra scrutiny. Big groups like AFP and Karl Rove’s Crossroads GPS avoided such scrutiny, until recently, at least.
By: Jason Sattler, The National Memo, January 15, 2014
“Supporting The Politicians”: Wal-Mart Exploits Employee Charity To Help Ted Cruz And John Boehner
Wal-Mart and other top U.S. corporations “reap worker political donations through charities,” according to a Bloomberg report published Monday.
Reporter Renee Dudley wrote that major companies, “forbidden to give money directly to political action committees, are taking advantage of controversial federal rules allowing them to ask employees to do it for them in exchange for matching charitable donations.” Dudley notes that the Federal Election Commission ruled in the 1980s that tying employees’ charitable donations to matching political contributions was legal, and that precedent has remained in place despite repeated disagreement within the agency, including a split vote in 2009. She reports the practice “has become commonplace,” and that those who contribute are mostly in management.
Wal-Mart, the world’s largest private employer, draws particular attention in the Bloomberg story, which says the retailer’s program is distinguished by offering a two-to-one rather than one-to-one match, and by requiring that the charitable donations go to the company’s Associates in Critical Need Trust. Wal-Mart’s employee-to-employee charitable activities drew unkind scrutiny in November, when the Cleveland Plain Dealer reported on a worker-to-worker food drive at a local store.
Bloomberg cites a 2004 memo from Wal-Mart’s then-general counsel pledging, “We’re going to be relentless in encouraging participation until 100% of our management associates are on board.” Center for Responsive Politics data for Wal-Mart’s “PAC for Responsible Government,” cited by Dudley, show a roughly even split in donations between Republicans and Democrats, with recipients including House Speaker John Boehner, Tea Party favorite Senator Ted Cruz and hometown conservative Democratic Senator Mark Pryor. (A June report from the union-backed Making Change at Walmart campaign, factoring in donations from the Walton family which owns half the company, found that 69 percent of combined total Wal-Mart and Walton donations from 2000 to 2012 went to Republican candidates or committees.)
Wal-Mart did not immediately respond to Salon’s inquiry regarding Bloomberg story. Wal-Mart Vice President David Tovar told Bloomberg’s Dudley that the program was “a great way for people who contribute to the PAC to also do good for fellow associates,” and offered “an opportunity to support the company and the things we’re advocating for on behalf of the shareholders, our associates, our customers” at the state and federal levels.
As I’ve reported, Wal-Mart also maintains the Walmart Foundation, whose grantees have included non-profits in key cities where the company seeks to expand. The legally-distinct Walton Family Foundation is a major funder of anti-union education reform efforts.
Bloomberg’s story comes weeks after a day of civil disobedience actions mounted by the non-union workers’ group OUR Walmart, which is closely tied to the United Food & Commercial Workers union. In an e-mailed statement, OUR Walmart activist Barbara Gertz called the Bloomberg story “further proof that Walmart is determined to spend millions to support politicians who vote to cut food stamps and who oppose increasing the minimum wage, instead of focusing on creating good jobs in our communities.” While OUR Walmart and allies have recently emphasized Wal-Mart employees’ widespread use of public assistance programs (including Congresswoman Jan Schakowsky calling those at the top of the company “welfare kings”), in October Wal-Mart’s U.S. CEO declared the company “cautious but modestly optimistic” that food stamp cuts would be good for business — a statement Congressman John Conyers told Salon “borders on the ludicrous.”
Gertz, a Denver Wal-Mart employee, said it was “upsetting to hear that Walmart not only exploited the associates in critical need fund to push a political agenda that hurts ordinary Americans, but it also may have done so in violation of federal laws.”
By: Josh Eidelson, Salon, December 23, 2013
“Getting Secret Money Out Of Campaigns”: It’s In The Public Interest To Disallow Sleazy Secret Money In Campaigns
The Internal Revenue Service spent years averting its eyes while clever campaign operatives abused the tax code for political purposes. Advocacy groups, mostly on the right, wanted to run attack ads while concealing the source of their money, and they came up with a brilliant way to do it: claim to be “social welfare” groups, which are allowed to hide donors.
Federal statutes say these groups can only engage in social welfare activity, but the tax agency decided political activity was fine as long as it wasn’t the primary purpose of the group. That helped create the torrent of secret money that poisoned the last few federal elections. The I.R.S. never explained, though, what kinds of activities are considered political, or why these groups, also known as 501(c)(4)’s, should be allowed to participate in campaigns at all.
On Thursday, long after the abuse became too rampant to ignore, the I.R.S. took the first tentative steps at reining in the problems it helped create. It proposed a definition of “candidate-related political activity,” an important starting point in determining what tax-exempt groups are really allowed to do. But it will have to do much more than that if it wants to be taken seriously as a regulator on this battlefield.
According to a press release from the Treasury Department, the agency said the new definition of political activity would include ads or other communications that clearly advocate for a candidate or party, or ads that mention a candidate within 60 days of a general election (30 days for primaries). That’s a good start for a definition, though 60 days is far too narrow a window — many of these attack ads air a full year or more before voting begins.
Once political activity is defined and separated from social welfare activity, 501(c)(4)’s will no longer be able to claim, as Karl Rove and others have, that “issue ads” mentioning candidates are for social welfare purposes. (These are the kinds of ads that say, “Dog-kicking is terrible. Call Senator Jones and tell her to stop doing it.”)
But a definition alone won’t do any good unless the I.R.S. tells these groups how much political activity is permitted. The ideal answer would be: zero. Social welfare groups have no business meddling in politics. Any group with a political interest has its own place in the tax code — they can be a 527 political organization. Those groups, which include political parties and official campaign organizations, also get tax exemptions, but there is one crucial difference: they have to disclose their donors, and 501(c)(4)’s don’t.
Conservatives immediately claimed that the I.R.S. was trying to take away their free-speech rights, which is laughable. Absolutely nothing is stopping advocacy from running ads, and the Supreme Court, in the Citizens United case, even granted corporations the right to make unlimited donations to independent groups that produce political ads. But there is no right to keep these donations a secret.
The Treasury announcement, tantalizingly, said the I.R.S. would consider comments from the public on how much political activity should be permitted for a social welfare group, suggesting that decision was farther down the road. It’s in the agency’s interest to end the confusion surrounding 501(c)(4)’s, which has led to charges that it has been arbitrary in its audits. But it’s in the public interest to do even more, and disallow sleazy secret money in campaigns.
By: David Firestone, Editors Blog, The New York Times, November 27, 2013
“Giving The Rich Even More Influence”: More Money Coming To An Election Near You
After the 2010 Citizens United ruling, which allowed corporations and unions to overwhelm federal elections with unlimited “independent” expenditures, the courts began overturning reasonable state-specific campaign finance rules — in Montana, for instance. Now it is New York’s turn.
A federal appeals court panel on Thursday said New York State’s long standing $150,000 cap on contributions to independent political groups was probably unconstitutional. The ruling came less than two weeks before New York City’s mayoral election on Nov.5. It might be too late for wealthy conservative groups to gin up support for Republican Joe Lhota in his uphill battle against Democrat Bill de Blasio. But the ruling could have a significant impact on elections starting next year.
New York State already has extremely lax campaign financing laws which allow unlimited donations to political parties for “housekeeping” purposes. Other contribution limits are scandalously high and some crafty donors have even found a way around those by creating multiple limited liability corporations that can each give the maximum to a candidate. For example, one real estate developer, Leonard Litwin, has used this dodge to contribute hundreds of thousands of dollars to Governor Andrew Cuomo’s campaigns.
New York’s Attorney General Eric Schneiderman will have to decide whether to appeal the decision. But he and others have suggested that there are possible alternatives.
He has argued that if the courts keep getting rid of the ceilings on contributions, one good option for New York State would be to raise the floor. By that he means that Albany’s politicians should create a public campaign financing system much like the one in New York City
For more almost 25 years, New York City has enjoyed the best and fairest campaign financing operation in the country. Candidates receive $6 in public funds for every $1 in contributions up to $175 per person. That matching system means more people can afford to run for office. Donors who write small checks know they can make a bigger difference. And voters have more choices, which might be the reason too many state legislators really oppose this way forward.
States that suddenly find big money flooding into their local elections could also fight back by demanding to know who’s writing those checks.
Shaun McCutcheon, who is at the center of a Supreme Court case challenging limits on campaign donations, issued a statement Thursday that said he is “very pleased that another court has decided to rule in favor of free speech.”
Actually it ruled in favor of giving the rich more influence than they already have over who wins public elections.
By: Eleanor Randolph, Editors Blog, The New York Times, October 25, 2013
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