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The
Corporate Reform Weekly
Vol
V. #25 June 26, 2006
In
This Issue
Lobbying
and Campaign Finance Reform
1.
Poll finds widespread support for publicly-funded elections
2.
Abramoff lawyer calls for comprehensive lobbying and campaign finance reform
3.
Former Bush aide Safavian convicted for lying in Abramoff investigation
Media
Ownership
4.
FCC considers new media ownership rules again
Corporate
Scandal
5.
Corporations getting away with hiring illegal immigrants under Bush
administration
6.
Homestore CEO convicted in accounting fraud
Accounting
7.
California weakens accounting regulations
This
Week’s Action Item
Let
your members of Congress know that the public supports public financing of
elections
Lobbying
and Campaign Finance Reform
1.
Poll finds widespread support for publicly-funded elections
A
new nationwide poll, conducted by Lake Research Partners and Bellweather
Research, demonstrates widespread support for publicly-funded elections and
suggests that candidates would do well to emphasize support for publicly-funded
elections in the upcoming campaign season.
Some
highlights from the polling:
Zero.
Three-quarters
of voters support a voluntary system of publicly-funded elections (57% support
it “strongly” and only 16% are opposed).
0.
Support
crosses party lines. Eighty percent of Democrats, 78% of Independents, and 65%
of Republicans support this reform.
0.
Support is
strong across
demographic and regional groups. This
reform enjoys strong support across gender lines, age groups, and
regionally—garnering no less than 60% support and in most cases around 75%
support.
0.
In a
generic congressional profile ballot where one candidate signed a reform
pledge, the candidate who signed the reform pledge always won, regardless of
party affiliation. Republicans who supported the pledge beat Democrats who didn’t
support the pledge 49% to 39%, and Democrats who supported the pledge beat
Republicans who didn’t support the pledge 58% to 29%.
For full
details, see: “Bipartisan
Poll Shows Strong Support for Public Financing and Voters First Pledge,” Published on Public Campaign Action Fund
(http://www.campaignmoney.org)
2.
Abramoff
lawyer calls for comprehensive lobbying and campaign finance reform
Abbe D.
Lowell, lawyer for lobbyist Jack Abramoff, last week wrote an op-ed in USA
Today calling for comprehensive lobbying and campaign reform, including full
public funding of elections. Lowell’s op-ed adds to the increasing consensus
that the lobbying reform bills that the House and Senate passed earlier this
year (but have not yet become law) are woefully inadequate.
Lowell
specifically called on Congress to:
• “Require
fundraisers to disclose publicly their interest in legislation.”
• “Require
sponsors of “bundled” contributions (individual contributions arranged together
for greater impact) to disclose their roles.”
• “Impose
further limits on the total amount individuals can give in an election cycle.”
• “Provide
additional public financing of campaigns.”
• “Help
candidates pay for access to various media.”
Lowell also
wrote:
“What hasn't
received much scrutiny is the interplay between lobbyists and fundraising. As
long as campaign engines need to be fueled, special interests and lobbyists who
have the most immediate interest in legislation will have the most incentive to
supply the gas. This gives lobbyists an unfair advantage in access and
persuasion. More often than those simply interested in good government,
lobbyists will take on the request from a member or a member's staff that:
“Gee, I will consider your position of that bill or your client's interests,
and, by the way, I am having a fundraiser next week.””
“For decades,
the Justice Department's practice has been not to consider campaign
contributions linked by timing or sequence to official action as illegal
bribes. The recent scandals may change this. But lawmakers, not prosecutors
reinterpreting policy, should set the stage for change.”
See: “Real
reform must scrutinize lobbying and lawmakers,”
By Abbe D.
Lowell: http://www.usatoday.com/printedition/news/20060621/opcomtues.art.htm
3.
Former Bush aide Safavian convicted for lying in Abramoff investigation
David
Safavian, the former General Services Administration chief of staff, was
convicted last week of lying to investigators looking into the
influence-peddling activities of his friend Jack Abramoff and of helping
Abramoff to acquire two properties that were controlled by the GSA.
Safavian now
faces up to 20 years in prison and $1 million in fines. He will be sentenced in
October.
Prosecutors
showed jurors a series of e-mails between Safavian and Abramoff in which
Safavian provided inside advice to Abramoff in connection with properties
Abramoff was hoping to acquire. Prosecutors also described Safavian’s
participation in the now-legendary lavish 2002 Scotland golfing trip that
Abramoff provided for a number of powerful Washington officials.
Federal
prosecutor Nathaniel B. Edmonds said the reason Safavian didn’t cooperate with
federal investigators initially was that he wanted to cover up the fact that he
was “doing Jack Abramoff’s bidding.” Edmonds said that Safavian maintained a
“secret, inappropriate and unethical relationship” with Abramoff and the he
offered Abramoff "access, he offered connections, he offered power."
Assistant
Attorney General Alice S. Fisher, the head of the Justice Department's criminal
division, said in a statement that "the message of this verdict is clear:
in answering questions posed by Congress and by federal agencies, public
officials have the same obligation as does the public for which they serve — to
tell the truth."
Safavian was
the first Abramoff associate to be convicted in a jury trial. Five other
Abramoff associates have already pleaded guilty to various corruption charges.
One of those who pleaded guilty was Neil G. Volz, a lobbyist and former staffer
for Rep. Robert
W. Ney (R-Ohio). Volz testified against Safavian and legal experts
believe his testimony was the key to the government’s case against Safavian.
Volz could play a key role in a potential trial against Ney, who is being
investigated for favors he may have performed illegally for Abramoff and his
clients.
For more, see:
“Ex-Budget
Aide Is Guilty of Lying in Lobbyist Case,” By PHILIP SHENON,
New York Times, http://www.nytimes.com/2006/06/21/washington/21safavian.html
“Ex-Aide To
Bush Found Guilty: Safavian Lied in Abramoff Scandal,” by
By Jeffrey H.
Birnbaum: http://www.washingtonpost.com/wp-dyn/content/article/2006/06/20/AR2006062001626.html
Media
Ownership
4.
FCC considers new media ownership rules again
Three years
after the Federal Communications Commission voted to loosen media ownership
rule only to be met with an onslaught of public opposition and an eventual
court ruling against the deregulation, the FCC last week voted to again take up
media ownership rules.
With a media
landscape that is slightly different now, the FCC will re-visit questions of
how many radio and television stations companies can own in the same media
market and what kinds of cross-ownership across different forms of media (radio,
television, newspapers) will be allowed in the same media market. Large media
companies continue to seek loosening of the rules, while critics worry that the
current state corporate consolidation already threatens democracy by limiting
diversity of news and ideas.
One issue
during the 2003 rulemaking session was that the FCC sought only the most
minimal public participation before voting on the rules. This time around,
commissioner Jonathan Adelstein is pressing FCC Chairman Kevin Martin to commit
to making proposed rule changes public before the FCC votes on the issue.
Martin has yet to agree to this, however.
In a public
statement, Martin said that media ownership rules were "a topic of vital
importance to our democracy,” and that the FCC should "should take into
account the competitive realities of the media marketplace while also ensuring
the promotion of the important goals of localism and diversity."
Gene
Kimmelman, a vice president at Consumers Union, complained about the
"widespread public concern about concentration and bias in the media. We
need to remind the commission how important a variety of independent and
locally owned sources of news and information are to our democracy."
FCC
Commissioner Michael J. Copps also issued warnings about the impacts of media
deregulation: "This innocuous-looking document initiates the single most
important public policy debate that the FCC will tackle this year. It means
deciding whether or not to accelerate media concentration, step up the loss of local
news and change forever the critical role independent newspapers perform for
our country."
Corporate
Scandal
5.
Corporations getting away with hiring illegal immigrants under Bush
administration
Despite the
Bush administration’s rhetoric about cracking down on companies who hire
illegal immigrants, the Washington
Post reports that the
administration “virtually abandoned such employer sanctions before it began
pushing to overhaul U.S. immigration laws last year, government statistics
show.”
According to
federal statistics reported in the Post, the number of employers prosecuted for
unlawfully employing illegal immigrants dropped from 182 in 1999 to just four
in 2003, and fines collected dropped from $3.6 million in 1999 to just $212,000.
In 1999, the government fined 417 companies for illegally employing immigrants.
In 2004, it fined just
five
companies.
The Post
article describes a “steady retreat from workplace enforcement in the 20 years
since it became illegal to hire undocumented workers is the result of fierce
political pressure from business lobbies, immigrant rights groups and members
of Congress.” The article also notes that “Punishing employers also was
de-emphasized as the government recognized that it lacks the tools to do the
job well, and as the Department of Homeland Security shifted resources to
combat terrorism.”
For more, see:
“Illegal Hiring Is Rarely Penalized: Politics, 9/11 Cited in Lax Enforcement,”
By Spencer S. Hsu and Kari Lydersen, Washington Post:
http://www.washingtonpost.com/wp-dyn/content/article/2006/06/18/AR2006061800613.html
6.
Homestore CEO convicted in accounting fraud
Another
CEO was convicted of accounting fraud last week. This time it was former
Homestore Inc. CEO Stuart Wolf, who was found guilty of 18 counts of
conspiracy, insider trading, making false regulatory filings and lying to
auditors in connection with a $67 million accounting fraud at the home-listing
service company.
Prosecutors
charged that Homestore inflated revenue through phony transactions with
AmericaOnline and other companies that did business with Homestore, essentially
transferring money to itself by paying vendors like AOL too much money for
services so that AOL would in turn overpay for advertising, allowing
Homestore to inflate its earnings.
The
prosecution follows a $71 million 2003 Homestore settlement with shareholders,
led by the California State Teachers’ Retirement System, who brought a
class action suit for losses suffered due to phony accounting. The
company’s auditor, PricewaterhouseCoopers, also settled with investors
last year.
For
more, see:
“Ex-Homestore
CEO Guilty in Fraud Trial,” By Martin Zimmerman, Los Angeles Times: http://www.latimes.com/business/la-fi-homestore23jun23,1,4261113.story
Accounting
7.
California weakens accounting regulations
Under pressure
from accounting firms, California’s Board of Accountancy, which licenses
accounting firms and certified public accountants, is starting to roll back
accounting standards, a trend that is causing concern among watchdog groups and
lawmakers.
According to a
report in the Los
Angeles Times, the board
is pushing a bill in the state legislature that would allow out-of-state
auditors to provide tax shelter advice without state oversight. Questionable tax
shelters are estimated to cost the state of California $500 million a year in
lost revenue.
Watchdogs are
also concerned that Gov. Arnold Schwarzenegger recently appointed Marcus
McDaniel, a lawyer who represents Big Four accounting firms, to the state
accountancy board, replacing Gail Hillebrand, widely considered the strongest
consumer protection voice on the board.
For
more, see:
“State
Moves to Ease Oversight on Accountants,” by Peter Nicholas, Los Angeles Times:
http://www.latimes.com/news/local/la-me-enron19jun19,0,3949425.story?page=2&coll=la-home-local
This
Week’s Action Item
Let
your members of Congress know that the public supports public financing of
elections
Last week,
polls confirmed that the public supports public funding of elections, which
will be the most effective way to root out entrenched corporate interests
in Washington DC and thin out the ranks of corrupt lobbyists.
But members of
Congress may not have taken the time to familiarize themselves with this poll.
As this week’s action item, please call your elected officials and let them
know that the public supports public funding of elections.
According
to the polling:
0.
Three-quarters
of voters support a voluntary system of publicly-funded elections (57% support
it “strongly” and only 16% are opposed).
0.
Support
crosses party lines. Eighty percent of Democrats, 78% of Independents, and 65%
of Republicans support this reform.
0.
Support is
strong across
demographic and regional groups. This
reform enjoys strong support across gender lines, age groups, and
regionally—garnering no less than 60% support and in most cases around 75%
support.
0.
In a
generic congressional profile ballot where one candidate signed a reform
pledge, the candidate who signed the reform pledge always won, regardless of
party affiliation. Republicans who supported the pledge beat Democrats who
didn’t support the pledge 49% to 39%, and Democrats who supported the pledge
beat Republicans who didn’t support the pledge 58% to 29%.
For full details,
see: “Bipartisan
Poll Shows Strong Support for Public Financing and Voters First Pledge,” Published on Public Campaign Action Fund
(http://www.campaignmoney.org)
* Contact your
senators: http://www.senate.gov/general/contact_information/senators_cfm.cfm
Contact your
congressional representative: http://www.house.gov/writerep
Help
spread the word about The People's Business
We encourage
you to tell everyone you know about the Citizen Works book, The People's
Business and to distribute promotional flyers locally. Flyers are available
online, or if you would like to have some flyers mailed to you, please e-mail news@citizenworks.org.
The People's
Business, which is available in stores everywhere, examines the very nature of
corporate power, presenting a range of strategies to curtail it, explaining how
ordinary people can restore citizen control. Bringing together the
recommendations of the Citizen Works Corporate Reform Commission—a coalition of
leading authors, activists, scholars, and professionals—The People's Business
is a vital, clearheaded plan for strengthening individual rights, transforming
corporations into engines of public prosperity, and creating a sustainable,
life-respecting society where the people have the power.
Bolstered with
relevant history and examples, The People's Business is a lively book that will
appeal both to deeply-committed long-time activists looking for a coherent
approach in the struggle for corporate accountability as well as thoughtful
citizens everywhere who may be looking for immediate measures that serve as
effective means of corporate reform.
It is our hope
that The People's Business will serve as an important tool in educating people
about what they can do to challenge corporate power. But it will only be an
important tool if people actually read it. That's why we need your help in
spreading the word!
Why not pick
up your copy at a bookstore today if you haven't already?
MAKE YOUR
VOICE HEARD
* White House Comment Line: 202.456.1111
* White House Fax Line: 202.456.2461
* E-mail President George W. Bush
* E-mail Vice President Dick Cheney
* White House Address: 1600 Pennsylvania Ave, Washington, DC 20500
* US Capitol Switchboard: 202.224.3121
*
Contact your senators: http://www.senate.gov/general/contact_information/senators_cfm.cfm
· Contact your congressional
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