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Tilting at Windmills

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October 7, 2010

HOW DONOHUE AND THE CHAMBER OPERATES.... This week, ThinkProgress unveiled an important item, documenting the fact that the U.S. Chamber of Commerce, which is investing $75 million in attack ads against Democrats in the midterms, may be using foreign funds to influence the outcome of American elections.

Tuesday, the Chamber offered a vague, half-hearted defense, which only reinforced concerns that the secretive, conservative lobbying group was doing something it shouldn't be. Yesterday, as the significance of the revelations grew, the business lobby went after ThinkProgress with a vengeance.

The Chamber's pushback may have been aggressive, but it did not address the underlying concerns. Faiz Shakir explained late yesterday:

[The Chamber's] smoke-and-mirrors response serves to obfuscate the basic facts which ThinkProgress revealed:

1) The Chamber acknowledges that it receives foreign sources of funding.
2) The foreign funds go directly into the Chamber's general 501(c)(6) entity.
3) At least $300,000 has been channeled from foreign companies in India and Bahrain to the account.
4) The foreign sources include foreign state-owned companies, including the State Bank of India and the Bahrain Petroleum Company.
5) The Chamber's 501(c)(6) entity is used to launch an unprecedented $75 million partisan attack ad campaign against Democrats.

Nothing the Chamber has said in response to our story refutes those basic set of facts. The right-wing business group claims that it has a "system" in place to ensure that money is not being used for illegal purposes, namely to influence U.S. elections. But the Chamber refuses to explain how that "system" works, and is instead demanding that the public simply trust-but-not-verify.

Just to flesh this out a little further, let's also note that the Chamber's president and CEO, Tom Donohue, has a certain m.o. when it comes to creating walls between accounts -- or in his case, not creating walls.

When Donohue left the American Trucking Associations in 1997, his successor, Walter McCormick, publicly accused Donohue of leaving the ATA in a financial mess, as the National Journal reported in 1999. McCormick even hired a Washington litigator specializing in white-collar crime to investigate the ATA's finances under Donohue, although no lawsuit resulted. The Chamber claims that the investigators concluded ATA "was one of the best run trade associations" and its chief financial officer received an apology from the association's board. But an ATA employee brought on by McCormick with intimate knowledge of the organization's finances at the time offered a different view.

"There was a whole bunch of organizational units which were odd," says the employee. "All of those units were separate entities, separately incorporated. Money was moving around from one to the other to the other." Adds journalist John Schulz: "He said to me once, 'It's just sort of one big pot and how we divide it up is immaterial.'"

Donohue -- and his accounting practices -- are now at the U.S. Chamber of Commerce, which is raising money hand over fist, from countries and governments from around the world, to elect candidates who'll disregard the needs of American consumers and workers. The Chamber claims to have a "system" to stay within the law, but Donohue also has a track record of creating "one big pot" -- and concluding that how it's divided up is "immaterial."

Steve Benen 9:55 AM Permalink | Trackbacks | Comments (18)

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Comments

The "system" is irrelevant anyway. Money is fungible. They could have a perfect system for ensuring that foreign money doesn't go towards elections, and only goes towards administrative overhead and whatnot; that would just free up more domestically raised money for politicking.

Its a big pile of money. Even if they keep the Euros and Yen separate from the Dollars, it's still money all the same.

Posted by: Gangis Khan on October 7, 2010 at 10:06 AM | PERMALINK

Just so long as we don't threaten American sovereignty (and multinationals' profits) while we try to save ourselves from AGW.

Come to think of it, the man is close to correct in that the 'legal' donations from multinationals aren't much more likely to have Americans' best interest at heart than the strictly foreign entities.

Posted by: jhm on October 7, 2010 at 10:08 AM | PERMALINK

In all fairness, the "Citizens United" decision didn't specify that money only come from American corporate "citizens."

Posted by: c u n d gulag on October 7, 2010 at 10:11 AM | PERMALINK

The CoC's response was hilariously stupid. Think Progress is an anti-business group funded by George Soros? Puh-lease. You'd think that people smart enough to run such a huge organization would be smart enough not to go to that well so often. Memes tailor-made for Faux "News" style extremists don't resonate with the general public.

If this manages to catch fire and really get out, people are going to (rightfully) wonder what the CoC has to hide.

Posted by: Shade Tail on October 7, 2010 at 10:20 AM | PERMALINK

This is more than just an 'oopsie', IMO. I'd love to know the original source of that money. Couldn't possibly be those friendly folks in Saudi Arabia, hmmm?

Posted by: MattF on October 7, 2010 at 10:22 AM | PERMALINK

As surely as we need separation of church and state we need separation of corporate personage and state.

I am not anti-corporation as we need the jobs but a ceo/lobbbyist/banker should not be directing government as a business or writing laws [unconstitutional]
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Stiglitz and Bilmes estimated two years ago that 30 to 33 percent of returning Iraq and Afghanistan war veterans (fewer than 400,000) would have sought care in the Veterans Administration (VA) health system by 2010. But as of March, more than 565,000 such veterans have already been treated by the VA. They hadn’t expected to reach that number until 2016.

Posted by: Kill Bill on October 7, 2010 at 10:42 AM | PERMALINK

Its a distraction statement. Even if the money were seperated into shoeboxes, with foreign money to go to say paying the electricity bill it still means that money went to pay for political attack ads as the course of business requires the use of computers, phones, lights etc etc to produce attack ads.

Beware the political perception management.

Posted by: Kill Bill on October 7, 2010 at 10:54 AM | PERMALINK

@Shade Tail, define "anti-business group".

Do you mean a group which is for protecting jobs in this country? Do you mean a group which wants to stop the practices of American business not paying taxes in this nation? Do you mean a group which wants a vibrant American economy providing meaningful and well paying jobs for Americans?

If that is "anti-business", then, consider me "anti-business", as well.

Or do you, simply, mean a group maligned by FAUX and the Right Wing as being "anti-business" because it does not support the very Anti-American workers business groups in America?

Posted by: berttheclock on October 7, 2010 at 10:58 AM | PERMALINK

Shade Tail said:
If this manages to catch fire and really get out, people are going to (rightfully) wonder what the CoC has to hide.

IF THIS GETS OUT ? ! ?

Jesus Christ! Here is another ad that writes itself. It could be the central theme of a nationwide campaign. And yet there's no sign that Democrats are going to use it.

This year the U.S. Chamber of Commerce will spend $75 million to elect Republicans who will protect the freedoms . . . of corporations. Freedom from rules that keep diseases like E Coli and Salmonella out of the food you feed your children. Freedom from rules that keep poisons out of the water you drink. Freedom from rules that help keep you safe from injury when you're at work.

Is the Chamber doing something wrong? They refuse to tell us were the money is coming from, so they must have something to hide. The Chamber even accepts money from foreign countries like India and Bahrain to facilitate moving American jobs overseas.

The Republican Party and the U.S. Chamber of Commerce . . . working for you?


Heck, the ads could even use the same photo of dangerous-looking brown-skinned men that Angle and Diaper David used.

Posted by: SteveT on October 7, 2010 at 11:00 AM | PERMALINK

The funds don't have to go directly the $75 million ad buy in order to benefit. If those foriegn funds free up enough capital elsewhere to allow the chamber to invest in Republican canidates.

For example. There is a $5 million program currently funded through domestic sources. The bank of India comes along and gives the Chamber $100k to fund that program. The Chamber can then redirect $100k worth of 'domestic' funds away from that program and to the ad buy. It's perfectly legal and is probably what the Chamber is doing.

The only question is how much of quid pro quo is going on behind the scenes. A sort of 'I'll donate $1 million to X program if you agree to divert an additional million to go after Democrats" kind of thing

Posted by: thorin-1 on October 7, 2010 at 11:11 AM | PERMALINK

Money is fungible. Until the Chamber proves otherwise, I can only assume they are protecting the names of child molesters and pornographers and foreign governments and businesses.

Posted by: Tigershark on October 7, 2010 at 11:21 AM | PERMALINK

C'mon, Democrats. Think outside the box. Are there any foreign countries the DNC could be soliciting money from?

Posted by: beejeez on October 7, 2010 at 11:36 AM | PERMALINK

berttheclock: You did read my post, didn't you? You did notice the question mark after that sentence and the sarcastic "puh-lease" that followed?

The USCoC claimed that Think Progress is an anti-business blog funded by George Soros, a statement that I treated with blatant scorn. I'm not sure how I could have been any clearer.

Posted by: Shade Tail on October 7, 2010 at 11:52 AM | PERMALINK

Remember too all that foreign ownership of Faux - it would be interesting to compare.
BTW, everyone: take these stories and share them on your Facebook pages, I do. I think it makes a significant impact on "visibility."

Posted by: Neil B on October 7, 2010 at 12:07 PM | PERMALINK

...and is instead demanding that the public simply trust-but-not-verify.

There you go again...

-St. Ronnie

Posted by: Marko on October 7, 2010 at 1:21 PM | PERMALINK

"Heck, the ads could even use the same photo of dangerous-looking brown-skinned men that Angle and Diaper David used. - SteveT

And don't forget nukes going off in the background

Posted by: Marko on October 7, 2010 at 1:29 PM | PERMALINK

Can someone explain why foreign countries and entities give money to the US Chamber of Commerce in the first place? What's in it for them? Isn't the purpose of the Chamber to promote American business interests?

Posted by: Michael on October 7, 2010 at 4:31 PM | PERMALINK

"Isn't the purpose of the Chamber to promote American business interests?" asks Michael.

Well, no, actually not. The Chamber's real name is "Chamber of Cronies." Its purpose is to promote the interests of a select group of investors and C-suite Poobahs, plus their trophy wives, lobbyists, lawyers and tame politicians.

Posted by: Mandy Cat on October 7, 2010 at 7:32 PM | PERMALINK
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