Category: Campaign Finance

Good News from the Ohio Primary

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Jean “Mean Jean” Schmidt lost the Republican primary for Ohio’s 2nd CD to political newbie Brad Wenstrup.

It’s a good thing, though she lost to someone who appears to be even more conservative.

The interesting thing is that a new super Pac, the Campaign for Primary Accountability, which dropped a significant chunk of change against her, mostly taking her to task for voting to increase the debt ceiling.

This same group also supported Kucinich against Kaptur, and is going after Jesse Jackson Jr. in Illinois, as well as Spencer “Insider Trading” Baucus (R-AL).

I’m inclined to think that they are a beard for right wingers. Both Kucinich and Kaptur are firmly liberal, but Kaptur was the more effective legislator, if just because Kucinich was so determinedly iconoclastic, and the wing-nuts hate anyone named Jesse Jackson.

Additionally, its founder, Eric O’Keefe is a winger and a Club for Growth puke, which further reiforces my suspicions.

The post Citizens United world of campaign finance is remarkably opaque.

Heh

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The Republicans have discovered the downside to the Citizens United ruling in the person of one Newton Leroy Gingrich.

It appears that Newt’s bit of scorched earth insanity is almost completely funded by an equally unhinged, and very rich patron, one Sheldon Adelson, who had contributed millions to the “totally not coordinating” Gingrich super-PAC.

It still does not make Citizens United a good ruling. It’s and awful, corrupt, and politically motivated decision by the conservative bloc of the Court, but I am amused by how it’s biting the ‘Phants in their flabby white asses.

Quote of the Day

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Warren and Brown are jockeying back and forth on the best method of keeping outside groups out of their race. Here’s a novel concept: Both candidates could just buy up all the television air time themselves. After all, based on their ludicrous fundraising pace, it looks like they’ll be able to afford it.

—Reid Wilson upon observing that Elizabeth Warren had a 24-hour money bomb that raised over $1 million

Did the CFTC Just Call Louis Freeh’s Corrupt?

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Because this sounds a lot like them saying that he is either corrupt or criminally incompetent:

MF Global Inc. (MFGLQ) commodity customers must be paid before all other claimants, including the bankrupt parent company, according to the Commodity Futures Trading Commission.

Court papers by the trustee for MF Global Holdings Ltd., Louis Freeh, contain “errors and misstatements of law” in arguing that commodity laws, which require that customers be “made whole” first, don’t apply to brokerage liquidations, the regulator said in a court filing today. Freeh, representing the parent company creditors, has said money due to them shouldn’t be “diverted” to customers.

If Freeh was right, “the senseless result would be to render inapplicable the key regulations of the Commodity Futures Trading Commission in the largest commodity broker bankruptcy in U.S. history,” the CFTC said. The result would “strip” customers of a remedy, after they entrusted their assets to the brokerage relying on rules for segregating customer money, it said.

What is going on here is that someone *cough* JP Morgan Chase *cough* looted customer accounts as MF Global as the company circled the drain, and they hired Freeh to cover up the theft.

Here’s an analogy about US law for former judge and FBI director Freeh:  If you buy a stolen car, you don’t get to keep it.

Am I the only one who thinks that not only is Freeh is being paid to cover up for the thieves who plundered this company in its final days, but that he’s being completely incompetent about covering their tracks.

H/t Atrios.

Good News on the Campaign Front

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On the Congressional side.

First, in Maryland’s 4th district, Donna Edwards will be running unopposed in the primary, former PG County States Attorney (DA) Glenn Ivey declined to run, which basically means that she will be reelected.

The primary was actually a matter of some concern, because the redistricting moved a lot of Montgomery County was moved out, and a lot Anne Arundel county moved in.

Because AA county is more Republican, it meant that PG County, and the (largely corrupt) PG County machine had a lot more influence over any primary contest, and Edwards is not a their friend, having taken down their golden boy, the then-incumbent Al Wynn in 2008.

Not only is she honest, but she is an unabashed liberal, so 2 snaps up.

Additionally, in the Massachusetts Senate race, Elizabeth Warren out-raised Scott Brown in 2011, $8.9 million for the year and $5.7 million for the quarter as versus $8.7 million and $3.2 million, though Brown still has about twice her cash on hand, $12.8 million versus $6 million.

Considering the fact that Brown is Wall Street’s favorite Senate candidate, this is surprising, and welcome, news.

It’s On (Sort of)

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Stephen Colbert has passed the Colbert super PAC to Jon Stewart, (the special effects involved could be best described as “low budget”) and established an “exploratory committee” to “explore” run for the Republican nomination in his native South Carolina.

Cool.

He could probably beat John Huntsman.

The video will be up on Comedy Central tomorrow some time.

Supreme Courts Says that there are Limits to Campaign Donations

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So, if you are a foreign person, you are still forbidden from making campaign donations:

In a terse four words, the Supreme Court on Monday issued an order upholding prohibitions against foreigners making contributions to influence American elections.

The decision clamped shut an opening that some thought the court had created two years ago in its Citizens United decision, when it relaxed campaign-finance limits on corporations and labor unions. On Monday the Supreme Court, upholding a lower court’s decision in Bluman, et al., v. Federal Election Commission, refused to extend its reasoning in Citizens United to cover foreigners living temporarily here.

Foreign nationals, other than lawful permanent residents, are completely banned from donating to candidates or parties, or making independent expenditures in federal, state or local elections.

The Supreme Court’s order did not discuss the merits or suggest that there was any dissent among the justices.

It sounds to me like they just said that foreign persons cannot make campaign donations, but under Citizens United, foreign corporations can.

Our political system, brought to you by BMW, the ultimate driving machine.

Louis Freeh to Account Holders, Drop Dead

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You knew it was coming when this corrupt rat-bastard was appointed trustee. Now he’s trying to f%$# the account holders out of the money that JP Morgan Chase and the rest of the usual suspects stole from the:

MF Global Holdings Ltd. (MF)’s creditors should have some priority to be repaid by the bankrupt estate, said Chapter 11 trustee Louis Freeh, citing intercompany loans made between the failed parent and its operating unit.

Freeh, representing the interests of creditors of the parent company, commented on the legal principles that will govern repayments in papers filed late yesterday in Manhattan bankruptcy court. Former customers of the broker-dealer unit, seeking an estimated $1.2 billion missing from their accounts, are being repaid in a related case overseen by a different trustee, James Giddens, appointed under the Securities Investor Protection Act.

The holding company has “substantial intercompany claims” against the broker-dealer unit on account of former intercompany loans, and any recoveries of that money shouldn’t be “diverted” to customers, giving them a priority at the expense of creditors of the parent company, Freeh said.

Freeh is concerned that “an inappropriate interpretation” of the law may lead Giddens to deny the rights of creditors to recover from property that was never deposited by them, lawyers for Freeh wrote.
Customer Pool

The conflict is “not whether certain estate property can be distributed to customers, but whether estate assets that would otherwise be available for distribution to MF Global Inc.’s creditors can be reallocated to the customer pool,” Freeh said.

Seriously, the assets he is referring to were stolen by those “creditors”.

First, he obstructs the investigation of the theft of client accounts, and now he’s trying to f%$# the account holders.

It must be nice to be able to be so blatantly corrupt and get paid for it.

Adding Someone to My Act Blue List

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Rob Zerban.  (see Matthew Saroff’s Act Blue Page)

He’s running against everyone’s favorite Randroid nutjob, Paul “Let’s voucherize Medicare” Ryan, and a recent poll seems to show that he is vulnerable:

A prominent Democratic pollster is making the case that the party should invest in a challenge to Rep. Paul Ryan, the architect of the conservative House budget plan.

Pollster Paul Maslin’s survey of 405 likely voters “shows that challenger Rob Zerban is well-positioned to give incumbent Paul Ryan the toughest fight of his career, with a very good chance to upset him,” Maslin wrote in a memo.

A serious campaign against Ryan is a tempting prospects for Democrats hoping to restore the third-rail status of the major entitlement programs Ryan would dramatically alter; it would be a massively expensive effort on both sides in a state, Wisconsin, that has been the center of the ideological combat of the last year.

The survey found the district, the Wisconsin First, evenly divided on partisan issues — both President Obama and Governor Scott Walker have even approval and disapproval ratings

According to the memo, the late October and early November poll found a deep dislike of Congress in general that is spilling over onto Ryan

Here’s hoping that he raises some good money, because if the Democratic Party apparatus, particularly the DNC under Tim Kaine, is true to form, they aren’t going to support him at all, but will instead blow their money on conservadems on solidly Democratic districts.

It Appears that Batsh%$ Insane is Bad for Business

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Because it looks like the big corporate fat cat donors are not supporting the Republicans as one would expect:

Last month, the Democratic Congressional Campaign Committee just about doubled the haul of their counterparts, the National Republican Congressional Committee. The DCCC pulled in $6.64 million, while the NRCC brought in just $3.8 million. While the NRCC has more cash on hand (around $12.2 million to the DCCC’s around $9.5 million) and slightly less debt, over the course of the year the DCCC is outraising the team with the big House majority.

The year-long totals show the DCCC raising nearly $48 million to the NRCC’s just over $44 million.

I think that the Republican Party Presidential Primary clown show has convinced business executives that Republicans are simply not a good investment, because while one can price risk, you can’t price uncertainty, and insane motherf%$#er teabaggers are the very definition of uncertainty.

OK, Maybe She Has a Chance

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Elizabeth Warren’s Senate campaign raised $3.15 million in the 3rd quarter, more than double Wall Street darling Scott Brown’s haul of $1.55 million:

 Consumer advocate Elizabeth Warren is off to a quick start when it comes to raising money for her Senate campaign in Massachusetts, with a debut total — $3.15 million — that may even out-perform some of the Republican candidates for president.

Warren, who helped set up the new Consumer Financial Protection Bureau and is a favorite candidate among progressives, announced the impressive third-quarter haul in an email to her supporters Monday. She said that 96% of the contributions came in donations of $100 or less.

Note that, “Most of the money was raised since she formally joined the race for the Democratic nomination in mid-September.”

You gotta figure that she’s going to get a lot of sweat equity out of her supporters as well.

I think that the primary campaign is basically over, but I still think that Scott Brown, particularly with the enthusiastic backing of the banksters, and what will surely be tepid support from the Wall Street living Democratic establishment *cough* Obama *cough* will be a though nut to crack.

But I am no longer making a prediction about the outcome.

Oh, Now I Get It!!!!!!

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It seems like ir was just earlier this evening, I was wondering what political calculus could be driving numerous states Attorneys General to walk away from the so-called “50 State Deal” on “Robosigning”.  (Wait, it was just earlier this evening)

Well, now we know why.  The New York Times just described the recent transition of New York AG Schneiderman from a very (for New York, anyway) low key Attorney General to Political superstar:

The other day, in his office down on Wall Street, Eric T. Schneiderman owned up to an awkward truth.

Until fairly recently, he acknowledged, if you had asked the average passer-by to name New York’s attorney general, you might have gotten a mystified “Huh?” or the answer that it was Andrew M. Cuomo (the governor who used to have the job) or Eliot Spitzer (the disgraced former governor who had it before that), rather than the correct response: Mr. Schneiderman.

In the eight months since he has assumed the office, the emphatically unglamorous Mr. Schneiderman has maintained a low profile for the state’s top law-enforcement officer, charting a busy but anonymous course between Spitzerian aggression and Cuomoesque charm. Even his own press aide, Danny Kanner, recently confessed that, before this summer, his own parents did not know who Mr. Schneiderman was. “And I’m their kid; I work for the guy,” Mr. Kanner said.

But then came August, when Mr. Schneiderman, 56, rejected a proposed nationwide settlement releasing some of the country’s biggest banks from a lawsuit brought by the states claiming misconduct in the mortgage markets. Almost overnight, he found his own name mentioned in a series of laudatory articles in publications as varied as Rolling Stone, The Rochester Democrat and Chronicle and the Web site Gawker.

Adding fuel to the profile-raising fire were the phone calls Mr. Schneiderman received this summer from officials in the Obama administration who pressured him to smarten up and join his counterparts in other states in settling the case. There were reports that a Federal Reserve official, Kathryn S. Wylde, had harangued him in public for his stubbornness (at the funeral for Hugh L. Carey, the former New York governor, no less). At the end of August, an unrepentant Mr. Schneiderman was kicked off the executive committee of attorneys general in charge of the case by its leader, Tom Miller, the attorney general of Iowa.

The cynic in me wonders if perhaps the fact that the flood of adoring correspondence was accompanied by, “Small tsunami of campaign donations,” might have something to do with the increasing numbers of Attorneys General who are balking at signing an agreement exchanging a token payment for immunity for the banksters.

Pass the Popcorn, Mortgage Fraud Edition

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And another shoe drops, as California leaving the 50 state mortgage deal, claiming that it’s too bank friendly, joining New York, Delaware, Minnesota, and Massachusetts (link) in objecting to the blanket grants of immunity proposed:

California Atty. Gen. Kamala Harris will no longer take part in a national foreclosure probe of some of the nation’s biggest banks, which are accused of pervasive misconduct in dealing with troubled homeowners.

Harris removed herself from talks by a coalition of state attorneys general and federal agencies investigating abusive foreclosure practices because the nation’s five largest mortgage servicers were not offering California homeowners relief commensurate to what people in the state had suffered, Harris told The Times on Friday.

The big banks were also demanding to be granted overly broad immunity from legal claims that could potentially derail further investigations into Wall Street’s role in the mortgage meltdown, Harris said.

“It has been  a process of negotiating and sitting at a table in good faith, but ultimately I have decided that we have to go our own course and take an independent path. And that decision is because we need to bring relief to Californians that is equal to the pain California experienced, and what is being negotiated now is insufficient,” Harris told The Times in an interview.

Harris delivered the news in a letter sent Friday to Iowa Atty. Gen. Tom Miller, who has been leading the 50-state coalition.

Here are some other interesting bits:

The removal of California from the discussions is a major blow to fraying efforts by the coalition, which has been trying to strike a settlement deal with the big banks for months. The move by Harris to reject the settlement talks is also a key departure from efforts by the Obama administration, which has been pushing for a fast resolution to the so-called robo-signing scandal that erupted last year.

Just so you know, “Pushing for a fast resolution,” translates to, “Throwing lawbreakers another get out of jail free card,” because the Banksters are Obama’s real base.

“This whole concept of a settlement on foreclosure abuse is probably dead,” said Christopher Whalen, the founder of Institutional Risk Analytics. “Nobody in their right mind is going to opt into a settlement right now.”

So one would hope.  Neither the Obama administration, nor their corrupt lackey Iowa Attorney Gen. Tom Miller have had the slightest interest in pursuing any allegations or real wrongdoing against big banks.

I’m not sure what is motivating the AGs to bail on what would be a win-win for them, they get to “wave the bloody shirt” of some sort of settlement payments while insuring their own access to Wall Street campaign donations, but it appears that either they think that the political calculus is changing, or they just want to do the right thing.

Our Banking Model is Unsustainable

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Martin Wolf notes that banks current business model is predicated on a 15% return on equity, and this is fundamentally unsustainable:

According to a FT article last week, Lloyds’ bank has a target return on equity of 14.5 per cent. Banks like to argue that this is the level of return on equity they need to earn, in order to gain funding from the markets. Naturally, remuneration is linked to achieving such objectives. The question, however, is whether such objectives make any sense. The brief answer is: no.

Forget banks, for the moment. What would you say if someone offered you an investment with a promised real return of close to 15 per cent? You might say: “How much can I buy?” Alternatively, you might say: “What is the catch?” Sensible people must take the latter view. If you thought that you were being offered a reliable real return at such an exalted level, you would buy as much as you could. This must be particularly true now when real returns on the bonds of relatively safe governments are close to zero.

So what is the catch? The obvious answer has to be that the real return in question is extremely risky, because it is volatile and offers a significant chance of total wipe-out.

Indeed, it is perfectly obvious that these cannot be sustainable safe returns in economies growing at 2 per cent a year, for such a large and well-established industry. At a 15 per cent real return, the value of cumulative retained earnings would double in five years and increase 16-fold in 20 years. Pretty soon, bank equity would be the only real asset in the world!

He notes that at some point in the late 1970s, probably starting during the Carter era deregulation of the banks,* their return on equity diverged significantly from the overall rate of growth of the economy, and the way that they did this was by the same way that anyone increases return, by increasing risk.

They increased risk by both increasing risk inherent in each individual investment, and they did so by becoming even far more leveraged, raising the risk that even small setbacks would leave them illiquid or insolvent.

This doesn’t matter to the banks, because they are back stopped by government deposit insurance, so they are, in essence, gambling with the taxpayer’s money.

We need banking to be dull again.

In any case, go read the whole post, particularly the bit where he figures that the additional cost of capital from this is just 15 basis points. (0.15%)

*Yes, the last generation’s Barack Obama was the one who initiated the dismantling of the depression era banking regulations, and who stood idly by as the savings and loans went insane. Reagan was worse, but Carter got the ball rolling.

The Banks are Going Spitzer on New York AG Schneiderman

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They are hiring private investigators to dig up personal dirt on him and his staff:

The New York Post has a salacious story about Alisha Smith, a lawyer with the New York attorney general’s office, who is a dominatrix in her private life. Frankly, many of the skills honed by being a domme probably come in handy in litigation (such as knowing exactly how much pain and humiliation to administer when).

The problem isn’t with her having a kinky private life per se; it is the allegation by the Post that she may have gotten paid for performing at S&M parties. Smith makes all of $78,825 a year and the policy of the state AG’s office is for staff to obtain prior approval of any activity which will earn them more than $1,000. The Post presented its allegations about Smith, who was hired by Andrew Cuomo and played an important role in a securities fraud case that led to a $5 billion settlement by Bank of America. She has been suspended without pay as the AG conducts an investigation.

The banksters are going to stop at nothing to protect their asses, and what they feel is their God given right to earn insane pay for stealing money from the rest of us.

And the Daily Show Writers Rejoice

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Yes, the wife of wrestling magnate Jim McMahon, Linda, following a failed campaign in which she dumped millions of her husbands dollars on a epically failed campaign for the Senate in 2010, has decided to run again for the Connecticut Senate seat:

Linda E. McMahon, the wrestling mogul who spent $50 million of her own money in an aggressive but failed Senate run in Connecticut last year, will announce in the coming week that she will try again, according to two Republicans who are close to her.

Ms. McMahon, the two Republicans said, will seek the party nomination next year for the seat being vacated by Senator Joseph I. Lieberman, an independent who caucuses with the Democrats and who announced that he would not run for re-election. They requested anonymity to avoid being seen as upstaging Ms. McMahon’s announcement.

Her candidacy has the potential to alter the calculations of other candidates and potential candidates, if only because she has demonstrated an ability to finance a statewide campaign with little difficulty.

In last year’s Senate race, Ms. McMahon built a formidable political organization in just months and then led a hard-charging campaign that transformed a political newcomer into a highly visible figure in the state.

In the end, however, Ms. McMahon, the former chief executive of World Wrestling Entertainment, lost to Richard Blumenthal, a Democrat, in one of the most closely watched Senate races in the country.

This time, Ms. McMahon plans to raise money from private donors instead of relying strictly on her own money, according to one Republican close to her. She decided to take this approach partly because of criticism last year that she was using her wealth to buy herself a seat in the Senate, the Republican said.

And because she understands the concept of throwing good money after bad, so she is looking for some useful idiots.

Still the comedic possibilities are endless.

ActBlue — Elizabeth Warren Draft Fund

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Well, it looks likes Elizabeth Warren has a fundraising issue in her naisant bid for Senator from Massachusetts, specifically that Scott “Wall Street’s Bitch” Brown is raising money hand over fist from the Banksters, because the idea of someone who would prevent them from cheating the average consumer scares the sh%$ out of them:

Elizabeth Warren’s combative history with Wall Street could create a fundraising dilemma for her burgeoning Senate campaign.

Her ardent grassroots following on the left — forged during stints as TARP watchdog and as mastermind of the Consumer Financial Protection Bureau — would likely make her a formidable Senate candidate in Massachusetts.

But her reputation as sheriff to Wall Street could also be a liability against Sen. Scott Brown (R-Mass.), a popular Republican who has been stockpiling campaign cash in anticipation of a tight 2012 race.

If Warren runs, she will have to decide whether to court high-rolling donors in the financial services community — an awkward choice both personally and politically, given her carefully crafted image as antagonist to big finance.

“I think it’s pretty clear she’s going to run the classic, grassroots campaign here in Massachusetts,” said Mary Anne Marsh, a longtime Democratic operative in the state. “That means she’s going to rely on folks here to give low-dollar donations here a number of times.”

But without the support of heavy-hitting donors in Massachusetts, many of whom work at hedge funds and other financial firms, Warren might find it difficult to keep up with Brown’s fundraising juggernaut.

I tend to think that her bigger problem is that she has to fairly explicitly criticize Obama, but the (IIRC) she needs a modicum of support from the party establishment to net enough votes in the party caucus to even get on the primary ballot.

I tend to think that Warren will do more good outside of the Senate than inside the Senate, if just because being a woman with no seniority in what is a pretty misogynist institution is not a high impact position.

In any case, you can donate here, or via Matthew Saroff’s Act Blue Page

H/t Sarah Burris at Crooks and Liars

While We Are On the Subject of Bank of America

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When you offer a bribe, make sure that the mic is not live

Look at the video for this gem. A representative of Bank of America walks up to Rick Perry, and says, “Bank of America… We will help you out”.

It turns out that be Bank Of America’s director of public policy, James Mahoney.

Nope, no quid pro quo here, BoA has released a statement saying that, “Bank of America does not endorse Presidential candidates. The reference was about following up on the substance of the speech about job creation and economic growth.”

Yeah, we believe you, and we believe it when you say that MERS properly recorded mortgages, and that you f%$#s didn’t pay off the ratings agencies to rate your garbage as AAA,

H/t Cthulhu.*

*No, not the unspeakably malevolent super-being, the contributor to the Stellar Parthenon BBS.†
†OK, I’ve never seen the two of them together, so Cthulhu might actually be the Cthulhu, but the mere fact that he is on a BBS, interacting with humans‡ would seem to mitigate against this.
‡Yes, I know, this is the internet, where no one knows if you are a dog.