Friday, September 30, 2005

Campaign Finance Reform DeLay-ed

The indictment against Congressional Republican Leader Tom DeLay is a serious attack on political money laundering. To be clear, the charges will not be easy to prove, either in a court of law or in the court of public opinion. The allegations suggest that money which could not legally be spent on elections in Texas was instead funneled through a series of other political groups, each of which could legally take the funds, until it was no longer apparent that the money that Texas state candidates were handed was, in fact, illegal money.

While DeLay’s role in this remains a little unclear, what the PACs did is not new. ICPR found similar behavior here in Illinois, as both state parties washed federal soft money through their accounts and back into the fed’s hard money PACs. What makes these transactions criminal is the allegation that they were all designed and intended to evade Texas’ ban on giving by corporations. The prosecutor will likely try to show that none of the PACs involved would have given as they did without the first corporate checks at the start of the chain; that the $190,000 that arrived in October, 2002, from the RNC in the PACs of Texas state candidates was the same $190,000 in corporate money that, though forbidden to Texas state candidates, was raised in September, 2002, and transferred to the RNC; and that DeLay and his associates orchestrated these transactions.

Call it laundering, call it giving in the name of another, call it sham transactions; corporate giving is against the law in Texas. But not in Illinois. Illinois has no limits, no restrictions, no bans on anyone, anybody, or anything that has money to give to politicians. Corporations, unions, associations, trusts, and other non-persons can give as much as want, and candidates can take as much as they can get, under Illinois’ free-wheeling campaign finance rules. Illinois’ politicians are doing many of the same things that Texans are alleged to be doing. The difference is that Texas has made corporate giving illegal, while Illinois continues to tolerate unrestricted giving by special interests.

It’s time for Illinois to take a serious look at campaign finance.

Following Connecticut's Lead

In some ways, Connecticut’s woes mirror our own. Gov. John Rowland was alleged to have taken bribes and other incentives from state contractors in exchange for favorable reviews and additional contracts. When charged with criminal violations of state law, he resigned from office.

Now his successor, Gov. Jodi Rell, is doing something about it. Noting a guilty plea from a state senator to corruption charges and also the trial of our own former Gov. George Ryan, Gov. Rell has called a special session of the Connecticut General Assembly to consider campaign finance reforms. They re-convene in October for the express purpose of considering public financing, limits on contactor giving, and bans on fundraising by lobbyists.

Campaign finance reform gets a special session in Connecticut in response to a handful of convictions. Meanwhile, Illinois has seen over 70 Safe Road convictions, over three dozen Hired Truck and other Chicago convictions, and countless other credible accusations against sitting state and local officials.

When will Illinois finally address problems with our campaign finance system?

Thursday, September 29, 2005

Shrink the Contractors

Observers in Illinois will be sadly familiar with the broad outlines of Ohio’s Coingate scandal: large campaign contributors are rewarded with lucrative public contracts despite lack of qualifications, shoddy performance or the fact that the underlying work isn’t needed in the first place. In Illinois, this scenario has played out in Chicago’s Hired Truck program and the state’s powerwashing fiasco. In Ohio, a large donor was entrusted with state investments through the Bureau of Workers Compensation (BWC), which he used to buy highly speculative rare coins, losing tens of millions in the process. Which goes to show that corruption isn’t just an Illinois phenomenon.

What will surprise Illinois observers is the speed with which Ohio has moved to address the problem. The Cleveland Plain Dealer reports that the BWC has imposed contribution limits of $250 on all of its contractors. The limits apply to giving to state and local committees, candidates and parties, and special interest PACs. Here in Illinois, the Mayor of Chicago, the state Comptroller and some other statewide officials have restricted giving by contractors to their own PACs, but so far, the governor and the legislature have not moved to enact anything nearly so broad as the Ohio limits.

When will Illinois limit the influence of big donors?

Wednesday, September 28, 2005

The $156,423.70 Question

George Ryan’s defense team have argued in public that the former governor received no payment for any of the illicit activities he allegedly conducted while in public office. But until they explain how his campaign fund “found” $157K in the last half of 2000, we can’t really be sure.

In July, 2001, Citizens for George Ryan filed an amendment to its campaign disclosure report for the second half of 2000 showing a new, surprise receipt of $156,423.70 . The PAC claimed this was an “adjustment to bank account”. The cash was held at North Community Bank, where the PAC had not previously reported holding funds. Ryan co-defendant Larry Warner was, at the time, a director of North Community Bank.

Will either Ryan or Warner give a full accounting of the source of these funds?

Want to see the report itself? Here’s the link:

And here's the page...

Wednesday, September 21, 2005

Playin downstate

The Peoria Journa-Star ran a strong editorial this morning. Anyone wondering where reform is should look at HB 743, HB 4073, SB 39, or SB 1822. The solutions are there; the problem is as much a lack of will as anything else.

[text of the ediorial]

New scandal a new distraction

Wednesday, September 21, 2005

We want to believe Gov. Rod Blagojevich when he says he had "no involvement whatsoever in anything surrounding the alleged corruption at the teachers' retirement system, and nobody close to me does either."

Yet . . .

History has taught Illinoisans to be skeptical. Two former governors served prison time in the last 30 years and a third, George Ryan, went on trial Monday for official misconduct. Seventy-three state workers and their friends have been convicted in Operation Safe Road, the bribes-for-drivers-licenses inquiry that mushroomed into a full-scale investigation of various irregularities during Ryan's tenures as secretary of state and governor. Now two men, one a former chief fundraiser for the Democratic National Committee, have pleaded guilty in the burgeoning TRS scandal. It would be fair to say that, where politics are concerned, Illinois has long fostered a bipartisan culture of corruption.

That does not mean Blagojevich ever took part in it or that he should in any way be held accountable for the sins of others. Indeed, maybe this governor really is different. Maybe he really didn't have anything to do with an alleged scheme that traded consulting fees for pension fund business, payments that ultimately rewarded a "high-ranking public official," according to plea agreements in federal court. Maybe two of Blagojevich's top fundraisers had nothing to do with the scam, though they've reportedly been identified in court documents. And maybe "Public Official A" - the unnamed state official referred to in the plea agreement - is someone else.

Yet . . .

Blagojevich has amassed the largest campaign war chest of any governor in the state's history, raising $14 million, a good deal of it from people who do business with the state. The man who ran for governor as a reformer promising to change "business as usual" in Springfield has headed an administration plagued by state and federal inquiries. Those have involved allegations of pay-to-play politics, improprieties at the state agency that oversees hospital construction, and trading state appointments for campaign cash. Political allies have gotten state jobs. Blagojevich brought his ethics reforms forward too late in the last legislative session for them to have much chance of passing.

The governor hasn't been charged with anything, says he hasn't been subpoenaed in regard to the TRS probe and emphatically maintains that the allegation "does not describe how we do things." No prosecutor has publicly suggested he personally committed any wrongdoing. At this juncture, he deserves the benefit of the doubt.

Still, this is disconcerting in a state that has endured years of investigations and convictions, apparently with no end in sight. It's also a further distraction in a state that has no shortage of public policy issues requiring attention. In the land of Honest Abe, this stuff just has to stop. With one of the most aggressive U.S. attorneys this state has ever had in Patrick Fitzgerald, it's a wonder it hasn't already.

Friday, September 16, 2005


Joseph Cari and Steven Loren, who yesterday entered into plea agreements admitting to steering state contracts for political purposes, had both previously made political contributions themselves to Illinois candidates. Steven Loren gave a total of $4,800, mostly to Gov. Blagojevich ($4,500) and the remainder to Chicago Mayor Richard M. Daley. Joseph Cari gave $3,400, including $200 to former Chicago Bull Bob Love for his failed aldermanic effort, $250 to Chicago Clerk of Court Dorothy Brown, and $250 to Andrew Boron, who lost a primary to current State Rep. Ken Dunkin. But the biggest recipient of Cari’s giving was former Calumet City Mayor Jerry Genova, who got $2,700 between 1998 and 2001, when he was convicted of racketeering, theft of funds, and mail fraud charges.


Political observers risk whiplash if they try to follow both the George Ryan trial and the filings implicating our current governor related to the Stuart Levine indictment, so fast have the stories been hitting. We recently posted to our website a new page of background material for the George Ryan trial, including a timeline and data on Ryan’s campaign fund. If you’re looking for the Levine findings, here they are:

Steven Loren Plea Agreement (especially pages 3-8)

Joseph Cari Plea Agreement (especially pages 3-7)