Propublica broke the story of famed financial deregulator Phil Gramm's protégé Jeb Hensarling, a Texas Republican who in January became (federal) House Finance Committeee Chairman, going on a weekend ski trip sponsored by Wall Street and other corporate interests, a mere six weeks after becoming Finance Chair, where he was raising money for his political action committee "Jobs, Economy, and Budget (JEB) Fund":
The congressman’s political action committee held the fundraiser at the St. Regis Deer Valley, the “Ritz-Carlton of ski resorts” known for its “white-glove service” and for its restaurant by superstar chef Jean-Georges Vongerichten.Okay well this is kind of shady. The new House Chair using soft-money loopholes to raise unlimited funds through his political action committee by going to a high-class resort and inviting financial firms and big corporations to come contribute. Must be an isolated case from this fine upstanding congressman.
Donors working in various financial industries are Hensarling’s biggest supporters, giving him over $1 million in the last election cycle, according to the Center for Responsive Politics. The congressman’s office did not respond to requests for comment.....or not...
But maybe the contributors weren't such bad actors after all and there is no conflict of interest?
Others donating to Hensarling’s JEB Fund around the time of the Utah ski weekend: Capital One; Credit Suisse; PricewaterhouseCoopers; MasterCard; UBS; US Bank; the National Association of Federal Credit Unions; Koch Industries, which is involved in sundry financial trading; the National Pawnbrokers Association; and payday lenders Cash America International and CheckSmart Financial. All either declined to comment or did not respond to requests.Hard to find a corrupt financial institution or interest that isn't on that short list.
And finally, here's the biggest problem of this entire story:
There’s no evidence the fundraiser broke any campaign finance rules. But a ski getaway with Hensarling, whose committee oversees both Wall Street and its regulators, is an invaluable opportunity for industry lobbyists.These contributions, both direct and soft money, are totally legal, because it's almost impossible to prove that there's a "pay for play" intent in these actions. They're forced to disclose the contributions so that we can see clearly that there is a conflict of interest, but there's no laws that regulate these kinds of interactions at all to protect the public interest from corrupt shills.
But let's look at this issue right in the eye. Jeb Hensarling is a corrupt politician owned by corporate interests, with disproportionate contributions to his political career coming from the finance industry which he is supposed to be tasked with regulating as Chairman of the House Finance Committee.
How on earth is it legal for this man to go off on a ritzy ski-trip fundraiser with bankers, lobbyists, and corporate "legislative affairs" representative? Our ethics and corruption laws don't go anywhere near as far as they should in preventing lobbying revolving door (the two-year ban with exceptions is totally useless) or direct money influence and dark pools of soft money, where even disclosure is hard to manage properly given current transparency laws.
Yes, it's a free country and with Citizens United we've equated monetary contributions with speech, and thus all individuals and corporations may give money to whomever they choose, and without any limit in the case of soft money.
Yet how can we ignore the clear corrupting influence of this money on weak individuals like Rep. Hensarling? We already know he's well-funded by the industry, and his actions will show that he's on their side, but there's no way to prove that he received that money and performed duties in return, which is of course illegal. Thus he can continue to receive unlimited money to his third-party organizations and work on legislation in their interests all the while claiming that it's totally irrelevant and it's a free country so he can get money from whomever he wants...
He has already come out against controls for Too Big To Fail and was a major figure in the blocking of progress with the Consumer Finance Protection Bureau
One can only assume with his power as Finance Committee Chair, he'll be hard at work for his "constituents" on Wall Street (even if he represents a small Texas district...).
This news also comes alongside other Southern Republicans behaving badly. In Virginia, GOP Governor Bob McDonnell is under investigation by the FBIafter allegations by a former chef of improprieties, involving a Star Scientific CEO Jonnie Williams. Of course, Attorney General Ken Cuccinelli decided to press charges against the chef (not political motivations at all!). Yet, Democrats are demanding his resignation now because Cuccinelli didn't disclose that he had over $10,000 in donations from the very corporation at the heart of the McDonnell scandal.
Bartlett cites a paper that EVERYONE should read from Northwestern that discusses the influence of money in politics with numerous references and is co-authored by Larry Bartels, a political scientist who has written about the growing inequality and money corruption in America. An excerpt from the conclusion:
Recently political scientists have characterizedSo the study explores the views of the wealthy in a small sample, and finds an uncanny resemblance between the policies coming out of Washington and the personal beliefs of the wealthy power elite in the private sector.
contemporary America as an Unequal Democracy, where
an Unheavenly Chorus sings with unequal political voices;
as an arena ofWinner-Take-All Politics; even as an outright
(albeit circumscribed) Oligarchy.64
Our evidence indicates that the wealthy are much more
concerned than other Americans about budget deﬁcits.
The wealthy are much more favorable toward cutting
social welfare programs, especially Social Security and
They are considerably less supportive of several jobs and income programs, including an abovepoverty-level minimum wage, a “decent” standard of living
for the unemployed, increasing the Earned Income Tax
Credit, and having the federal government “see to” —or
actually provide—jobs for those who cannot ﬁnd them
in the private sector
The wealthy are signiﬁcantly less favorable to increasing
government regulation of Wall Street ﬁrms, the health care
industry, small business, and especially big corporations.
This is getting very scary.
The linked study gives a nice background, but for more reading on this topic here are some important books: Lawrence Lessig's Republic Lost and One Way Forward and Larry Bartels' Unequal Democracy: The Political Economy of the New Gilded Age and Obama & America's Political Failure. The common thread in this issue of modern corruption and conflicts of interest is the problem of money in politics. There are solutions, we the people don't have to stand by where this blatant corruption is in full swing.
Call it plutocracy, call it oligarchy -- hell, call it freedom of speech -- but whatever it is, it's not democracy, it's outright legal corruption. And while the GOP is particularly cozy with corporate interests, this is a problem on both sides of the aisle: Democrats are just as guilty of these corrupt tendencies to accept money and then act representing those money interests, but without any proof linking intent or motive to buy influence (where it becomes illegal). If we are a nation of laws, we need to protect public integrity and get money out of politics and hold our public officials to higher standards of accountability and remove conflicts of interest.