Money Makes The World-- Or At Least DC-- Go Round: Meet The Sewer Money Buying Congress
Tomorrow is primary day in Maryland. The hottest race in the state is in Prince Georges County, southwest of Baltimore— MD-04. It’s the wealthiest and best educated Black majority district in America. The incumbent, Anthony Brown, is running for Attorney General, so it is an open seat— And a very plum one at that. Before this year’s redistricting, the partisan lean was D+54. Post-redistricting it got a lot bluer: D+75. Donna Edwards was the Representative before she ran, unsuccessfully, for the Senate and now she should be heavily favored to win. But her opponent is… AIPAC.
AIPAC is right-wing Israeli-American political action committee, which along with it’s super PAC, United Democracy Project and the sleazy Democratic Majority for Israel, launders Republican (and some say Israeli) money into primary races against progressive Democrats. By far, most of their victims are women of color who favor policies like tackling Climate Change, Medicare-for-All and fair taxation. Virulently racist, AIPAC hides behind its Jewish identity— and its huge power in a Democratic Party political environment that is terrified to take them on. Ironically, the hand behind the curtain in AIPAC’s targeting is Black himself, Hakeem Jeffries, a career-long AIPAC (and Wall Street) lapdog who AIPAC is putting in as a replacement for Nancy Pelosi next year. They have dumped over $6 million into defeating Edwards on behalf of some random lobbyist they control. The race is all about the sewer money AIPAC has disingenuously deployed against Edwards, the way they have managed to defeat Nina Turner (OH), Jessica Cisneros (TX), Cristina Garcia (CA), Amy Vilela (NV), Daniel Lee (CA), Marie Newman (IL), and Erica Smith (NC) others. Their current top targets are Andy Levin (MI), Rashida Tlaib (MI) and Donna Edwards. They are flooding their districts with millions and millions of dollars in lies and distortions.
Although Pelosi is supporting Edwards, Steny Hoyer is backing AIPAC’s lobbyist candidate. Kate Ackley reported in Roll Call last week that “Edwards, in a recent interview, said the outside spending had been a distraction to her campaign, and she added that she didn’t think it would be a real contest without the heavy spending against her. She said the issue of support for Israel has been ‘nonexistent’ on the campaign trail, and she said she was concerned that some of the pro-Israel groups have targeted ‘women of color’ in other races, including spending against Pennsylvania’s Summer Lee, who won a primary in Pennsylvania’s 12th District, and Jessica Cisneros, who lost a primary to Rep. Henry Cuellar in Texas.”
The latest polling shows a dead heat between Edwards and the AIPAC-controlled candidate, with Edwards having fallen behind as the flood of negative ads have blanketed the district. This morning’s Jewish Daily Forward focused on another congressional race, one that AIPAC and DMFI aren’t involved with, one that encompasses much of Westchester and Rockland counties. Progressives are backing state Senator Alessandra Biaggi against DCCC chair Sean Patrick Maloney but Jacob Kornbluh reported on another aspect of that district’s election. “A Republican congressional candidate,” he wrote, “running to represent an upstate district with a significant Jewish population has received the financial backing of a controversial Buffalo Republican who expressed admiration for Adolf Hitler’s leadership style, recent FEC filings showed. Carl Paladino, a candidate for Congress in western New York, gave the maximum allowed donation of $2,900 to the campaign of Michael Lawler, a leading candidate to represent the 17th District in Rockland County. The contribution was made just days before remarks Paladino made last year surfaced in which he said that Hitler is ‘the kind of leader we need today.’ Paladino later said his statement was ‘a serious mistake.’ Lawler, a first-term Republican Assemblyman whose district includes the sizable Orthodox community in Ramapo, is on the list of new candidates the National Republican Congressional Committee (NRCC) is providing support to challenge Rep. Sean Patrick Maloney, chair of the Democratic Congressional Campaign Committee. Rockland County’s sprawling Hasidic communities have made it the largest Jewish population per capita of any county in the United States, and they tend to vote Republican.”
Even though they are almost entirely financed by Republicans, AIPAC and it’s affiliates don’t get involved with Republican races— just Democratic primaries where candidates they can control are up against progressives.
Earlier this morning, Judd Legum looked at the wider issue of billionaires buying the midterms this year. He doesn’t get into what AIPAC and DMFI are doing, mostly just the way billionaires are funneling money into Democratic and Republican superPACs— the Senate Leadership Fund (SLF) and the Congressional Leadership Fund (CLF) on the Republican side and the House Majority PAC (HMP) and the Senate Majority PAC (SMP) on the establishment Democratic side.
The two GOP SuperPACs, he wrote “collectively raised $188.3 million through March 2022. Nearly half of the money, $89.4 million, has come from just 27 billionaires, according to a new report from Americans for Tax Fairness. This figure understates the influence of billionaires pushing to restore Republican majorities in Congress. An additional $40 million in funding to the SLF and CLF has come directly from corporations. Some of these corporations are controlled by billionaires. Koch Industries, for example, has donated $1.75 million to the SLF and CLF and is controlled by billionaire Charles Koch. Another $35 million in donations to the SLF and CLF comes from entities organized as non-profits that do not disclose their donors. $18.7 million in funding comes from the American Action Network, a non-profit run by the same group of leaders, including former Republican Senator Norm Coleman, that run the CLF. The source of these funds is entirely opaque.”
The two Democratic groups “raise significant funds from billionaires— but it is a smaller percentage of their total receipts. According to Americans for Tax Fairness, the HMP and SMP have collectively raised $154 million in the 2022 cycle. About $25 million, around 17%, has come from billionaires. The reliance on billionaire dollars by Republicans and Democrats in 2022 reflects an acceleration of an alarming trend in American politics. Since the Supreme Court eliminated limits on so-called ‘independent’ expenditures by corporations and the wealthy in Citizen's United (2010), political spending by billionaires on federal races has exploded.”
Legum went right to the crux of the problem: “During the first two years of the pandemic, the net worth of the 44 billionaires who donated this cycle to the main Democratic and Republican Super PACs increased by $168 billion. These billionaires are now using a small percentage of their extraordinary wealth to shape the federal government to meet their economic and ideological interests.”
The largest donor to the main Republican super PACs is billionaire Ken Griffin, owner of Citadel, a hedge fund. Griffin donated $28.5 million to the SLF and CLF through the end of March. In a 2012 interview, Griffin was asked if "the ultrawealthy have an inordinate or inappropriate amount of influence on the political process."
"I think they actually have an insufficient influence," he replied.
Griffin says he wants the government to be less involved in financial markets. "I spend way too much of my time thinking about politics these days because government is way too involved in financial markets these days," Griffin said. "[T]he government being involved in picking winners and losers invariably leads to a loss of economic freedom and encourages corruption."
But Griffin was happy to have the government involved in 2008, when his hedge fund plummeted 55%, hemorrhaging $8 billion in client assets. Worse, Citadel was a securities lending counterparty with AIG, a large insurance and financial company on the verge of collapse. If AIG went under, it could have taken Citadel with it.
Instead, AIG received a $182 billion taxpayer bailout. As part of this, AIG was able to pay counterparties full value for their otherwise worthless contracts. Citadel got a $200 million cash infusion financed by taxpayers. (Ben Bernanke, the former Federal Reserve Chairman who engineered the AIG bailout, now works for Griffin at Citadel.)
Griffin spends lavishly to keep his tax rate low. In 2020, Griffin spent $54 million in a successful effort to defeat a ballot initiative that would have increased the tax rate for anyone making more than $1 million in Illinois, his home state, from 4.95% to 7.99%. (Anyone making under $100,000 would have received a tax cut.)
Griffin spent about $18 per vote to defeat the initiative. But it was a good investment. Defeating the initiative has saved Griffin about "$51 million every year in extra tax." In June, Griffin announced he was moving Citadel to Miami anyway, a state with no income tax. Griffin is one of the largest donors to Governor Ron DeSantis (R).
Returning the House or Senate to Republican control will reduce the risk of a federal billionaires tax. In March, President Biden proposed a plan to tax individuals worth $100 million or more at a 20% rate, applied to their total wealth. The proposal would "eliminate the ability for the unrealized income of ultra-high-net-worth households to go untaxed for decades or generations" and raise an estimated $361 billion over 10 years.
Griffin's spending is only rivaled by right-wing venture capitalist Peter Thiel, who has spent almost $30 million through super PACs dedicated to the Senate campaigns of two former employees, J.D. Vance (R) in Ohio and Blake Masters (R) in Arizona.
It’s worth mentioning that Griffin put around $50 million into the Illinois Republican primary for governor… and failed miserably against an extremist nut candidate, Darren Bailey, backed by American Nazi billionaire Dick Uihlein. The Center for Media and Democracy reported that Griffin’s $50 million for Irwin was “except for wealthy politicians who bankroll their own campaign… the largest amount ever given by a single donor to a U.S. candidate at any level.” Griffin’s handpicked candidates for Secretary of State (John Milhiser) and Attorney General (Steve Kim) were also rejected by Illinois Republicans. No doubt Griffin will find it much easier to control GOP politics in his new Florida headquarters, especially since he and DeSantis are now a team.
The Democratic villain this cycle is Sam Bankman-Fried, a crackpot crypto-billionaire who was Biden’s second biggest donor in 2020 and has been able to dictate to the DCCC as he works closely with, none other than… Hakeem Jeffries. Legun reported that he’s “the top donor to the main Democratic super PACs. Bankman-Fried, who is currently worth about $11.5 billion, donated $6.5 million to the HMP and SMP through the end of March. For Bankman-Fried, it's just the beginning. He says he's prepared to spend up to $1 billion on politics between now and 2024.”
He began the cycle by trying to assert his dominance, financing (to the tune of $12 million) a completely random person, Carrick Flynn, in an Oregon congressional race. He forced the HMP to put another million into the race. Their ridiculous candidate lost badly, though Bankman-Fried spent almost a thousand dollars per vote! Since then, he's just allowed Hakeem Jeffries to tell him where to invest his money-- and it's been almost entirely against progressives and for members of the Republican wing of the Democratic Party. Maybe he should just stick to trying to manipulate the bitcoin market.