Tuesday, Jul. 29, 2008

What makes Howie Rich’s donations so different

WHENEVER I write about all the money Manhattan millionaire Howie Rich is investing to remake our General Assembly in his image, I get two main complaints:

• All politicians are bought and paid for; you shouldn’t pick on this one guy.

• If you were fair, you’d write about all the out-of-state money other candidates receive, from corporations, teachers unions, etc.

In some cases, this is a deliberate attempt to obfuscate, perpetuated by people paid to do just that. At least as often, though, the complaints come from people who simply are not aware of how very different the Rich donations are from anything we’ve ever seen in this state, with the possible exception of the video poker barons a decade ago.

It’s true that most incumbents receive donations from R.J. Reynolds and Bank of America, from AT&T and Duke Energy. Emily’s List, the National Education Association and other groups associated with the left make donations as well, although most so-called “teachers union” money comes from the S.C. Education Association, which is a lobbying group but not a union.

If anyone wants to ban corporate and union donations, that’s fine with me. A corporation or a union is not a human being, and doesn’t have the First Amendment rights that the U.S. Supreme Court has ridiculously said gives actual people the right to spend all the money they please to influence our votes.

But there’s a big difference between those donations and the Rich donations, in at least four ways.

• First, while some incumbents receive the bulk of their funding from corporate interests, it’s rare that any one business is responsible for more than a sliver of a candidate’s total donations; few evade the $1,000 donation limit. Moreover, there’s a balancing function inherent in the hedge-your-bets approach of most corporations: A donation from AT&T, for instance, might be counterbalanced by one from rival Time Warner Cable.

And in those instances when a candidate is bankrolled by a single interest — say trial lawyers — that usually becomes a campaign issue. As it should. The Rich lackeys are clearly perturbed that his donations are an issue.

• Second, unlike Mr. Rich, who practically brags during his famous Katon Dawson interview that he has no financial, business or personal interests in our state, those other out-of-state interests do: They employ thousands of South Carolinians, pay S.C. income, sales and property taxes, run their businesses under the rules our Legislature passes.

I don’t think they should have as much say as voters (and certainly not a greater say), but they do have a legitimate interest in how our state is governed, which cannot be said of Mr. Rich.

• Third, although Mr. Rich makes the point that he is obeying our laws, he goes to greater lengths than anyone I’ve seen to get around the intent of the law, by hiding his donations until it’s too late for the information to do voters any good.

Donations that candidates receive during the final 20 days before an election don’t have to be reported until the following quarter. That makes it pretty easy for donors to hide their involvement until after the voting. (It also means voters have no idea who’s bankrolling a runoff campaign, since all runoff donations come in during this blackout period, but we can’t really blame the candidates or the donors for that.)

According to blogger Ross Shealy (scbarbecue.blogspot.com), who has been scouring legislative candidates’ campaign disclosure reports for Mr. Rich’s fingerprints, 10 of the 37 recipients of Rich et al funding in last month’s primaries didn’t receive any of that money until the blackout period.

In some cases, this penchant for secrecy is almost comical. In Greenville’s House District 22, Wendy Nanney took $18,000, 45 percent of her donations, from the Rich gang to unseat Rep. Gloria Haskins — a fellow voucher supporter. Yet even with no threat of an attack on that issue, Mr. Rich still delayed all but $3,000 of the donations until after the final pre-election disclosure reports were due, so voters couldn’t learn of them until after they voted.

• Finally, what makes the Howie Rich machine so different is the sheer volume of money he throws at candidates.

The Associated Press’ Jim Davenport identified $577,000 in last month’s primaries: $357,000 from Mr. Rich and 21 of his companies; $49,000 from other companies that share his Manhattan address; and another $171,000 from a handful of individuals and organizations affiliated with him.

That wouldn’t be quite so bad — though it’s more than the big corporations that employ South Carolinians tend to give — if it were equally distributed among the 35 recipients Mr. Davenport wrote about, or the 37 Mr. Shealy identified. It is not.

Mr. Shealy, who is as fixated on unmasking Mr. Rich as Mr. Rich is on imposing his vision on our state, tells me that 13 of the candidates received more than half their total donations from Mr. Rich and company; one received 97 percent. It wasn’t uncommon for House candidates to receive $20,000 or more; one Senate candidate received $740,000.

And what did Mr. Rich get for his investments? Twenty-one of his candidates lost, including three incumbents. One dropped out. One was unopposed. And 14 won, but that included five incumbents who were shoe-ins for re-election. Which shows that this kind of money can’t buy you everything — but it can buy something, particularly when no one knows you’re doing the purchasing.

• Wednesday: Who got the Rich donations, and how much they got?

Ms. Scoppe can be reached at cscoppe@thestate.com or at (803) 771-8571.

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