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  • Latest from the blog

    The Voice of the People

    A New Pro-Trump Super PAC Takes Aim at the Republican Establishment

    A group of pro-Trump media figures are launching a super PAC aimed at making an impact in the 2018 midterms.

    Jeff Giesea, Mike Cernovich, and Jack Posobiec, organizers of the “Deploraball” party to celebrate President Trump’s inauguration earlier this year, are behind the super PAC, which is being called #Rev18. All three are known quantities in the pro-Trump alternative media that emerged during the campaign and presidency, powered by Trump’s rise; they have since distanced itself from more extreme alt-right figures, often favoring the term “new right.” Cernovich has become known as an occasional breaker of news about the White House, while Posobiec rose to prominence after playing a key role in the #MacronLeaks story.

    The trio plans to back anti-establishment primary challengers in the midterms.

    “Our goal is to top-grade the GOP,” Giesea said in a press release the group will release on Monday. “This means defeating entrenched establishment politicians and replacing them with candidates who support American sovereignty and prosperity, and who put the American citizen first.” The group’s first endorsement is of Josh Mandel, the Senate candidate in Ohio, who is one of three Republican primary candidates there.

    The mission is of a piece with what other figures in the Trump base are trying to do this election cycle. Steve Bannon, the former White House chief strategist who has returned to the helm of Breitbart News, backed Roy Moore in the Alabama Senate primary; Moore’s victory, as well as the retirement of Breitbart target Senator Bob Corker, has emboldened Bannon in his plans to back other insurgent primary challengers against establishment candidates.

    Giesea filed the super PAC paperwork with the Federal Election Commission last month. “The board is me, Mike, and Jack for now,” Giesea said in an email. “We have an expanded board of advisors who are helping and which we’ll announce later.”

    Giesea, who at one point worked for Trump donor Peter Thiel at Thiel Capital Management, said the trio expects to attract big donors but has not done so yet.

    “I’m the first donor with a 50k personal investment,” he wrote. “We expect major donors come in soon but we want to prove the model and get the grassroots involved first. It’s safe to say we are broadly aligned with Team Bannon.”

    Asked whether someone like Thiel might get involved, Giesea said “Not naming names but certainly Thiel and Mercers would be fits. We’re hoping to broaden the base of contributors as well.”

    Bannon’s efforts have a powerful donor family backing them: the Mercers, his political patrons, who have invested in Breitbart and who are some of the most important donors in Trumpworld. The New York Times reported last week that Bannon has secured the Mercers’ backing for a “political coalition” similar to that of the Koch brothers, designed to support candidates running against the Republican establishment.

    Bannon is already tied to a pro-Trump super PAC that was involved in the Alabama race, Great America Alliance. His former political advisor in the White House is now a senior advisor with Great America.

    Giesea, Cernovich, and Posobiec’s effort is notable as one of the first forays of the mostly atomized, online pro-Trump movement into standard electoral politics. The three, particularly Cernovich and Posobiec, have mostly been viewed as consigned to the margins of the political sphere.

    It’s also a sign of the Trump movement’s growing independence from Trump himself. The Alabama result showed that Trumpism can survive and thrive even when Trump doesn’t; Giesea, in the group’s press release, emphasizes this, saying “#Rev18 is not a cult of personality. Our loyalty is to the America First agenda Trump ran on and the movement he galvanized more than to Trump himself.”

    Originally posted by The Atlantic on October 2, 2017.

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    Election law committee considers bills limiting foreign campaign spending

     

    BOSTON (WWLP) – Lawmakers are looking at public comments on 30 bills including proposals to update reporting requirements for candidates, enhance transparency in campaign finance, and limit campaign contributions.

    The state’s Joint Committee on Election Laws heard from the public on Wednesday regarding bills dealing with campaign finance. One bill would limit political spending by foreign-influenced corporations.

    Pam Wilmot of the watchdog organization Common Cause said this legislation is important to close loopholes for campaign contributions, amid concerns about allegations of Russian meddling in last November’s presidential election.

    “If they make a corporation, they can buy Facebook ads,” Wilmot explained. “They can buy TV ads. They can do all that stuff.”

    Facebook announced this month that it will provide congress with access to more than 3,000 Russia-linked ads.

    The bill still has a long way to go. The committee is currently reviewing public testimony on the bills before making recommendations.

    Originally posted by WWLP.com on September, 27 2018.

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    Schneiderman's Regulation of Citizens United Donors Upheld by Second Circuit

    New York State Attorney General Eric Schneiderman

    A challenge to the New York attorney general’s oversight of charitable organizations and their donors failed to convince the federal appellate court in Manhattan that First Amendment protections were being trod upon.

    Originally posted by the subscription-only www.law.com on February 15, 2018.

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    Chinese State-Owned Chemical Firm Joins Dark Money Group Pouring Cash Into U.S. Elections

    KAZINCBARCIKA, Oct. 1, 2011  Wanhua Industrial Group CEO Jason Ding (2nd R) attends a launch ceremony of the TDI-2 facility of Hungary' s chemical industry producer BorsodChem in Kazincbarcika, Hungary on Sept. 30, 2011. Hungarian chemical manufacturer BorsodChem on Friday announced the completion of a new TDI (toluene di-isocyanate) production facility in Kazincbarcika in northeast Hungary. The initial capacity of the new facility is 160 kilotons per year, making BorsodChem, in which China's Wanhua holds 96-percent ownership stake, Europe's largest TDI manufacturer. The company had invested over 200 million euros in the new facility. (Credit Image: © Xinhua via ZUMA Wire)

    Wanhua Chemical, a $10 billion chemical company controlled by the Chinese government, now has an avenue to influence American elections.

    On Monday, Wanhua joined the American Chemistry Council, a lobby organization for chemical manufacturers that is unusually aggressive in intervening in U.S. politics.

    The ACC is a prominent recipient of so-called dark money — that is, unlimited amounts of cash from corporations or individuals the origins of which are only disclosed to the IRS, not the public. During the 20122014, and 2016 election cycles, the ACC took this dark money and spent over $40 million of it on contributions to super PACs, lobbying, and direct expenditures. (Additional money flowed directly to candidates via the ACC’s political action committee.)

    For example, in 2012 the ACC was the largest single donor funding last-minute ads attempting to save former Rep. Eric Cantor, R-Va., then-House Majority Leader, during his losing primary campaign. The ACC donated $50,000 to a super PAC supporting the 2014 campaign of GOP Sen. David Vitter of Louisiana for the state’s governorship. And while lobbying to revamp federal chemical safety standards in 2015, the ACC simultaneously aired advertisements in support of key legislators who were then crafting an industry-friendly version of the legislation.

    Wanhua Chemical was founded as Yantai Wanhua Polyurethane Co. in 1998. Though the firm underwent a public offering about two years later, the ultimate controlling shareholder of the firm is a division of the Assets Supervision and Administration Commission of China, the government entity that oversees state-owned enterprises.

    Despite the nationalistic name of the organization, the ACC announced that Wanhua would join the group as a regular dues-paying member. Other dues-paying members of the ACC include BASF, Dow Chemical, Huntsman Corp., and Shell Chemical.

    The ACC’s membership guidelines state that a corporation may join if it “manufacturers and sells ‘chemical products’ in the United States, or manufacturers chemical products abroad but sells them in the United States.” Wanhua, notably, has pledged to spend over $1 billion on a new plant in Louisiana currently under construction.

    Wanhua and the ACC did not respond to requests for comment.

    The 2010 Supreme Court Citizens United ruling and related decisions made it possible for corporate trade associations like the ACC — known as nonprofit 501(c)(6) corporations — to spend as much as they want directly advocating for or against candidates for office “so long as that is not its primary activity,” the IRS says.

    This in turn made such organizations an ideal conduit for foreign money to influence U.S. races.

    It is formally illegal for foreign nationals — which includes foreign individuals, corporations, and governments —  to spend any money attempting to influence U.S. elections.

    Therefore, any contributions the ACC accepts from a foreign corporation like Wanhua must theoretically go to an account separate from that which the ACC uses for political spending. But whether this actually happens is extremely difficult for the public to find out, and even if the ACC is following the law, it would be essentially irrelevant.

    “I’m sure ACC will claim that any foreign funds it receives will be segregated from the money used for elections, but how will we know?” asks Brendan Fischer, a campaign finance counsel with the Campaign Legal Center, which advocates for stricter enforcement of campaign finance law. “And in any case, money is fungible, so the influx of Wanhua funds could free up other ACC resources for political activity.”

    “This is one of those situations where the scandal is what is legal,” continued Fisher. “The FEC will almost certainly accept ACC’s claim that it does not use foreign money to funds its ads, and because the FEC also allows dark money nonprofits like ACC to ignore disclosure requirements, neither the FEC nor the public will have any way of proving otherwise.”

    Secondly, and even more strangely, even a wholly owned subsidiary of a foreign company is considered American if incorporated in the U.S. — and therefore, can legally spend as much as it wants on American elections as long as it follows complicated, difficult-to-enforce regulations. “Even if Wanhua Chemical directly funded political ads,” says Fisher, “it could probably get away with it if the money came from its U.S. operations and was formally directed by U.S. citizens.”

    The ACC is by no means the only trade association to take advantage of Citizens United: After the decision came down, a number of organizations in the U.S. with foreign-owned members began spending corporate money on elections. The U.S. Chamber of Commerce, another 501(c)(6) with foreign corporate members, now routinely spends directly on congressional elections. Trade associations are in some ways the perfect vehicles for foreign money: Not only do they not have to disclose donors, most already maintain sophisticated lobbying operations, so that campaign cash is targeted in a way with the most political impact.

    The American Petroleum Institute is another trade group with foreign members that spend big on U.S. elections. Wanhua appears to be the second partially state-owned corporation paying dues to ACC. SABIC, the majority state-owned Saudi chemical company, is also a dues-paying member.

    In addition to Fisher, other campaign legal scholars noted that Wanhua’s decision to join the ACC represents another worrying example of creeping foreign influence.

    “The ACC’s spending is likely merely one example of foreign money that has or will be spent to influence who we elect as our representatives,” says Jessica Levinson, an ethics expert and professor at Loyola Law School in Los Angeles.

    Rick Hasen, professor of Law and Political Science at the University of California, Irvine, says he’s also concerned about the flow of foreign cash through untraceable “c(4)s, c(6)’s and LLCs which contribute to those entities and super PACs.” And he’s unsure the Federal Election Commission “disclosure rules and IRS investigations can deal with the issue of foreign money in U.S. election.”

    The significance of Wanhua contributing dark money to the ACC can be seen in a 2016 Intercept series on foreign influence on U.S. elections. The Intercept revealed that a Chinese-owned real estate company had directly donated to the super PAC supporting Jeb Bush’s presidential campaign. The decision to donate was made by Chinese nationals living abroad using a California-based subsidiary of their company. The election attorney advising the Bush super PAC even wrote a legal memo outlining how it was permissible to receive a donation from a foreign-owned firm.

    However, The Intercept was only able to track the money flow because donations to super PACs must be publicly disclosed. If the Chinese company had been sophisticated enough to give the cash to Bush’s related dark money outfit, no one would have ever known.

    Three Democratic FEC commissioners cited The Intercept’s series in a move to strengthen rules governing foreign corporate cash in elections. But any effort to move forward was thwarted by the three Republican members of the commission. Most major enforcement actions do not advance at the FEC because of the agency’s structure — no more than three of the six commissioners can be from the same party — and because GOP commissioners often vote as a block.

    This campaign cycle, the ACC is again airing campaign-style advertisements in key states, including the following spot for Sen. Dean Heller, R-Nev., who is facing a competitive reelection this year:

    “Maybe allowing corporations to spend unlimited amounts of money on politics is a bad idea,” said Fischer.

     

    Originally posted by The Intercept on February 15, 2018.

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