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McCutcheon Ruling Requires Americans to Reclaim Democracy

By: Robert Weissman Wednesday April 2, 2014 2:57 pm

Today’s U.S. Supreme Court ruling in McCutcheon v. Federal Election Commission strikes a devastating blow at the very foundation of our democracy.

Caricature of the Koch Brothers Dressed as Clowns

“No regular person can compete with Charles and David Koch.”

This is truly a decision establishing plutocrat rights. The Supreme Court today holds that the purported right of a few hundred superrich individuals to spend outrageously large sums on campaign contributions outweighs the national interest in political equality and a government free of corruption.

In practical terms, the decision means that one individual can write a single check for $5.9 million to be spent by candidates, political parties and political committees.

Even after Citizens United, this case is absolutely stunning. It is sure to go down as one of the worst decisions in the history of American jurisprudence.

Until today, nobody could contribute more than $123,000 total in each two-year election cycle to political candidates and parties.

Citizens United allowed Big Business to spend literally as much as it wants – predominantly in undisclosed contributions filtered through the likes of Karl Rove’s Crossroads GPS and the U.S. Chamber of Commerce – distorting our elections. But Citizens United money can go only to outside groups.

Now McCutcheon removes meaningful limits on the total amount an individual can directly contribute to candidates, political parties and political committees.

Yes, you and I now have the “right” to spend as much as we want, too.

But no regular person can compete with Charles and David Koch.

There are literally only a few hundred people who can and will take advantage of this horrendous ruling. But those are exactly the people our elected officials will now be answering to.

That is not democracy.

It is plutocracy.

Today’s reckless Supreme Court ruling threatens so many of the things we love about our country.

No matter what five Supreme Court justices say, the First Amendment was never intended to provide a giant megaphone for the wealthiest to use to shout down the rest of us.

Our only hope of overturning this McCutcheon travesty – along with Citizens United – is if millions of Americans band together in saying “Enough!” to plutocracy.

We couldn’t face a starker choice: Accept rule by the few, based on wealth. Or join together to protect and reclaim our democracy – the notion that We, the People decide.

Today, people across the nation will be responding with protests to this outrageous decision. We, the People insist that our government and our country remain of, by and for the people – all the people, not just those few who have amassed billions in wealth.

A vibrant movement for a constitutional amendment to overturn Citizens United and reclaim our democracy has emerged since the 2010 issuance of that fateful decision. The demonstrations today – unprecedented as a same-day response to a Supreme Court decision – are just the latest manifestation of how that movement is now exploding across the country.

We refuse to cede control of our country and our government to amoral multinationals and morally comprised plutocrats.


We Still Need Medicare-for-All

By: Robert Weissman Thursday June 28, 2012 4:10 pm

It will take some time to digest the Supreme Court’s decision today, but it appears to have averted some terrible jurisprudence that might have very seriously restricted the government’s overall ability to regulate the economy and protect citizens.

In upholding most of the Affordable Care Act, the Supreme Court lets stand legislation that offers some important benefits, but only to a portion of those who are uninsured, and will predictably fail to solve our nation’s health care crisis.

However the health reform law ultimately plays out, we know two things for certain: Tens of millions of Americans will remain uncovered as will tens of millions of under-insured who will remain at risk of financial ruin if a major illness strikes and it will leave the private health insurance and pharmaceutical industries in charge of prices and life-and-death treatment decisions.

There is a single solution to the challenges of providing coverage to the 50 million who are uninsured that would curb out-of-control health care costs and provide a humane standard of care to all who enter the medical system. That solution is an improved Medicare-for-All, single-payer system.

The improved Medicare-for-All approach starts with the premise that health care is a critically-needed right that must be afforded to all, irrespective of any individual’s ability to pay for care. It solves the problems of 50 million uninsured Americans simply and directly by establishing that everyone is covered by the improved Medicare-for-All system. Everybody in, nobody out.

Improved Medicare-for-All would prevent the deaths of the 45,000 Americans who die every year from lack of health insurance. It would eliminate the hundreds of thousands of medical bankruptcies – affecting millions of Americans every year – that occur because people can’t pay their medical bills. These deaths and economic tragedies are entirely preventable; a system that permits them to continue is morally repugnant and must be replaced.

The improved Medicare-for-All approach would eliminate the greatest waste in the health care system: the needless costs imposed by the private health insurers. These firms impose hundreds of billions of dollars of excess cost on us via their excessive profit-taking and executive compensation, their marketing expense, their vast bureaucracies devoted to denying care and their imposition of massive paper-pushing obligations on actual health care providers.

It is not for lack of policy justification or moral force that Americans continue to suffer from a malfunctioning health care system. Our failure to have adopted an improved Medicare-for-All system is due entirely to the political power of the health insurance industry.

That political power can be overcome, however, by a grassroots movement that musters enough of its own power. The country cannot continue to survive the continued reign of the private health insurance industry, and it will not.

Public Citizen is going to continue and step up its advocacy for a single-payer, Medicare-for-All system.

Winning a single payer, Medicare-for-All system will not be easy. In the near term, the single payer movement will need to devote substantial energy to holding off efforts to further privatize and weaken existing Medicare. The early steps forward in winning expanded and improved Medicare-for-All will likely come from state initiatives, where success will depend on local movements plus assurances that states pursuing improved Medicare-for-All can obtain needed waivers from federal laws and rules.

But there should be no doubt about what must ultimately be achieved. We cannot and will not tolerate a system that pointlessly kills 45,000 fellow Americans a year. For those who doubt the political potency of this moral imperative, consider that economic facts counsel for an improved Medicare-for-All system just as strongly.

We can be our brother’s (and sister’s) keeper and be cost-effective at the same time. Indeed, it turns out that being cost effective requires that we take care of each other.

The Transparently Secretive Chamber of Commerce

By: Robert Weissman Friday June 1, 2012 3:27 pm

Well, the Big Business guys are transparent about one thing: They can’t stand the idea of the public holding them to account for their attempts to buy elections and influence policy, or even that they be prevented from corrupting the government contracting process through campaign spending.

The latest: They are so terrified even of having their political spending disclosed that they are pushing in Congress legislation that would prohibit the government from requiring contractors to disclose their campaign-related spending.

Senator Susan Collins, R-Maine, is carrying their water, with the Orwellian “Keeping Politics Out of Federal Contracting Act,” a bill that recently passed the Committee on Homeland Security & Governmental Affairs and may well become law unless citizens move quickly to help stop this abomination.

The Collins initiative is in response to an excellent initiative floated by the Obama administration, but which the White House failed to implement. The simple idea was to require government contractors to disclose their campaign-related spending, including the kind of secret corporate campaign expenditures enabled by the Citizens United decision.

Contractor disclosure is important for two key reasons. First, virtually every major corporation enters into contracts with the government, so if contractors are required to disclose their campaign spending, that would cover most giant businesses. Second, the corrupting pall of campaign-related contributions is worst in the area of government contracting, since this is where the direct payoffs to corporations from political spending are highest. Disclosure will help mitigate the campaign-contractor corruption nexus.

Last year, it leaked that the Obama administration was considering an executive order requiring contractor disclosure.

The response from the U.S. Chamber of Commerce’s lead lobbyist, Bruce Josten: “We will fight it through all available means. To quote what they say every day on Libya, all options are on the table.” (As I mentioned at the time, just imagine if a prominent figure on the left – one with an office across Lafayette Park from the White House – used such charged, violent rhetoric.)

The Big Business guys have been unwavering in their strident opposition to disclosure of corporate campaign spending.

Said Chamber CEO Tom Donohue last week: “The disclosure thing is all about intimidation.”

The Chamber has certainly been consistent on the point. Here’s what Donohue said after the 2010 elections, in which the Chamber spent more outside money than any other group: “It is important to the Chamber not to change its practices [of not disclosing donors] because when it is known who made a contribution, it gives others the opportunity to demagogue them, attack them, or encourage them not to do it.”

As Carl Forti, one of the co-founders of the Karl Rove-affiliated Crossroads operations, said after the 2010 election, “Disclosure was very important to us, which is why the 527 was created, But some donors didn’t want to be disclosed and, therefore, a (c)4 was created.”

The Big Business worry is simple enough. If their spending is disclosed, consumers and shareholders may hold them accountable. This is what Donohue calls “intimidation.”

Back in the real world, the intimidation works the other way. Under relentless attack from the Chamber of Commerce and other business interests, the Obama administration declined to issue the contractor disclosure executive order – despite a strong public call for such action, and strong support from public interest advocates and Members of Congress.

Although there’s not much chance of the Obama administration issuing the contractor disclosure executive order in advance of the 2012 election, it’s conceivable that a second-term Obama administration would do so.

Which is why we’re confronted with the spectacle of legislation that would prevent the government from trying to reduce the likelihood of corruption through a simple disclosure requirement.

Concerned citizens should act now. If we have any respect for our democracy, we can’t let such a proposal become law.

Robert Weissman is president of Public Citizen.

Learning from Facebook

By: Robert Weissman Wednesday May 23, 2012 4:44 pm

Whether or not you’re an investor, it’s important to grasp the significance of what’s happened with the Facebook initial public offering (IPO).

In the few days since its IPO, Facebook’s stock price has fallen almost 20 percent amidst news that underwriters led by Morgan Stanley and perhaps Facebook itself shared negative assessments of the company only with big, institutional investors — not with the broader investing public.

It’s going to take some time to suss out exactly what happened with the Facebook IPO, but step back and consider the broader implications. They are staggering.

The most hyped IPO in history has turned into a debacle marred by insider dealing. It’s no exaggeration to say the whole world was watching — and still the decks were stacked against average investors. This is remarkable commentary on the untrustworthiness of Wall Street. If anyone had any doubts, it shows the utter folly in relying on Wall Street to police itself.

What’s that you say? Oh yes, that’s right, Congress did just pass and President Obama eager signed legislation — the misnamed JOBS Act — to reduce regulatory oversight of Wall Street and the issuance of IPOs. It aims to make it easier for new companies to launch IPOs without providing detailed information about their operations to investors. Whoops.

At the time the bill was under consideration, critics (including Public Citizen) suggested the JOBS Act was basically pro-fraud legislation. “The legislation is premised on the dangerous and discredited notion that the way to create jobs is to weaken regulatory protections,” wrote a public interest coalition headed by the Consumer Federation of America and Americans for Financial Reform. The legislation would “roll back regulations that are essential to protecting investors from fraud and abuse, promoting the transparency on which well-functioning markets depend, and ensuring the fair and efficient allocation of capital.”

The JOBS Act was an assault on common sense at the time it was passed — has the Obama administration and Congress really forgotten that the Wall Street crash that threw us into the Great Recession was caused in significant part by regulatory failures? — but it looks even worse this week than it did at time of passage.

It’s not too much to take from the Facebook debacle — along with other smoldering scandals, like the JPMorgan Chase multi-billion dollar derivatives loss and the accounting mess at Groupon — broader lessons than just that the JOBS Act was a horrendous mistake.

First, we need tougher not weaker controls on Wall Street activity. That means, at minimum, that we need aggressive and rapid implementation of the Dodd-Frank Wall Street reform legislation, including the Volcker Rule that aims to limit the speculative betting of big banks.

Second, and more generally, Big Business cannot be trusted to police itself. We need strong health, safety, environmental, financial and other regulatory protections, with well-resourced regulatory cops on the beat and citizens empowered to enforce the rules that regulators fail to apply.

These are simple lessons that you’d expect a child to understand. In Washington, though, these lessons are willfully forgotten and require constant reaffirmation. Well, the Facebook episode has done that once again.

Corporate Greed or Healthy Babies?

By: Robert Weissman Monday April 9, 2012 10:47 pm

Fact Number One: Exclusive breastfeeding for at least six months is best for infants and new mothers.

Fact Number Two:  Hospital giveaways of infant formula samples to new mothers reduce the amount and length of breastfeeding.

Given these two facts, why would hospitals serve as marketing agents for infant formula companies by giving away free samples of infant formula? Why do the formula companies — Nestle, Abbott and Mead Johnson — think they can get away with practices that undermine public health?

The first of these two questions is more mystifying. There is unanimity among health professionals on the key importance of breastfeeding. Many hospitals that encourage breastfeeding by new mothers simultaneously subvert their own health messaging by giving away formula samples, as well as discount coupons and other formula advertising.

If hospitals started out with the simple proposition that they shouldn’t be marketing commercial products, the infant formula giveaway problem wouldn’t exist. In the absence of a commercial-free hospital culture, hospitals take on a duty to be very self-conscious about the ways that they market or tout commercial products. When it comes to infant formula, most are failing to fulfill this duty.

The good news is that hospitals can be persuaded to do better. A Centers for Disease Control study finds that in 2009, 34.9 percent of hospitals had stopped distributing infant formula samples, up from 27.4 percent in 2007. The change follows advocacy campaigns from groups like the Boston-based Ban the Bags campaign and a stronger push for breastfeeding support from national public health agencies.

Now a new initiative by Public Citizen and more than 100 health and consumer organizations aims to up the pressure. The groups have sent letters to 2600 hospitals urging them to end giveaways, and more advocacy will follow. There’s just no excuse for hospitals to market infant formula.

Despite recent gains, American society is not sufficiently supportive of breastfeeding, and the everyday realities of many new mothers’ lives make exclusive breastfeeding very challenging. Giveaways of free samples directly undercut hospital efforts to support breastfeeding and sends exactly the wrong message to new mothers.
Mitzi Rose, a new mother from Rochester, New York, explains the issue perfectly:

“By the time I had my second child, I was adamantly determined to breastfeed. I was not influenced to purchase formula by the bags, but I do see how the presence of a “sample” of formula can be appealing to an exhausted and discouraged new mom. I could understand how a mother could feel driven to try it as just another way to appease a baby. The act of a hospital handing a new mom a sample of formula is the same as the hospital telling the mom that she can’t breastfeed exclusively, or that she shouldn’t breastfeed exclusively. The choice of formula, if it is necessary, should be made in consultation with a baby’s pediatrician, not determined by a contract with a formula company.”

One possible explanation for the persistence of hospital formula giveaways is the power of “free.” But the samples aren’t really free. Not only do they undermine a healthier means of nourishing infants — breastfeeding — they end up costing new parents in strictly monetary terms. Using formula is expensive. Samples are costly even for formula-feeding parents. Mothers who receive a particular brand in the hospital are likely to stick with it, costing them up to $700 extra per year as against cheaper alternative brands.

Now as to that second question — why do the infant formula makers think it’s OK to pursue unhealthy practices? — the answer is more straightforward: They are looking for profits, and they’ll do what they can get away with.

This is an industry with a record of employing horribly aggressive and deceptive marketing practices in poor countries — where breastfeeding is even more important than rich countries, because formula may be mixed with contaminated water, and because the economic costs of formula can overwhelm family budgets (or where mothers may use nutritionally inadequate amounts of powder, because they can’t afford enough). The infant formula companies still violate the terms of the World Health Organization’s formula marketing guidelines, but abuses are less severe than they once were, thanks to global campaigning by groups like the International Baby Food Action Network.

The World Health Organization guidelines plainly forbid giveaways of infant formula, but the companies have taken the view that the rules don’t apply in rich countries.

So, a last question: Are we going to let the formula makers get away with dangerous marketing practices that harm babies?

Sign the Public Citizen petition to tell formula makers to stop using hospitals as marketing tools, and stop endangering moms and babies with their quest for profits.




Eric Cantor’s Wall Street Insider Trading Loophole

By: Robert Weissman Monday February 13, 2012 4:07 pm

Sometimes, public outrage bubbles up, and forces Congress to take action to advance the public interest. The Big Business interests who normally count on the legislative process operating according to plan lose control. And that’s when they really set to work.

And it’s when the public interest advocates and the public itself are tested: With momentum on our side, do we have the attention span and organizational might to defeat aroused corporate interests?

Case in point: The STOCK Act, which aims to block improper use of nonpublic governmental information to gain advantage on the stock market. House of Representatives Majority Leader Eric Cantor is trying to ensure Wall Street traders will be able to continue this form of insider trading.

There is this curious fact: Members of Congress do demonstrably better on the stock market than average investors. There’s no plausible reason why this should be so other than that Members use their inside knowledge about legislation under consideration to place informed bets on the stock market.

Reformers, including Public Citizen, have long called for remedial action, to no avail. But the issue suddenly clicked with the public after “60 Minutes” ran a piece last November.

As public anger mounted, it became impossible for Congress not to act.

Last week, the Senate passed the STOCK Act to prevent Congressional insider trading. As the bill was being considered, amendments made it stronger. Notably, the Senate reinserted a provision on lobbyists, hedge fund managers and Wall Street traders obtaining and using inside government information. The provision is very modest, requiring only that so-called “political intelligence” consultants register.

“Political intelligence professionals aren’t considered lobbyists, so they don’t have to disclose that they’re seeking information and are paid for it” when they meet with elected officials or staffers, says Senator Charles Grassley, R-IA, who introduced the amendment. “As a result, members of Congress and congressional staff have no way of knowing whether such meetings result in information being sold to firms that trade based on that information. My amendment would shed sunshine on this kind of political intelligence gathering.”

Wall Street hates this measure. There’s a mini “political intelligence” industry that obtains information from political insiders and uses or sells it on Wall Street. You can see how knowing that a committee chair plans to add an obscure provision to a piece of legislation could translate into major, short-term advantage on the stock markets. Hedge funds love this kind of stuff.

Integrity Research Associates estimates the value of the global market for policy research and political intelligence services at roughly $402 million in 2009. They identify major lobby firms as among the leading political intelligence operations, including Patton Boggs, Akin Gump Strauss Hauer & Feld and Cassidy & Associates.

Wanting to preserve their unfair advantage from inside Congressional information, Wall Street lobbyists had Republican Majority Leader Eric Cantor strip the provision from the House bill.
It was quite a brazen move by Cantor. He knows Wall Street is unpopular. He knows the Democrats are going to attack him over the move. He has to know that he is defending the ability of a small slice of Wall Street traders gaining unfair advantage in the markets.

Now the ball is back in our court. The House and Senate versions will go to conference committee so that differences can be worked out (or alternatively, Congressional leadership might just negotiate a deal). It’s up to us to take action now to force Congress to eliminate Eric Cantor’s Wall Street insider trading loophole by putting this provision back into this legislation.

Pity Poor Newt Gingrich

By: Robert Weissman Wednesday January 4, 2012 11:23 am

Pity poor Newt Gingrich.

Alright, I admit it’s hard to muster much pity for Gingrich.

Still, he now stands as not the first, but the most recent, prominent victim of the Supreme Court’s abysmal decision in Citizens United v. FEC.

So if you don’t have any sympathy for Gingrich, at least feel profound worry about the state of our democracy – and make sure you do something about it.

There are many reasons to believe a Newt Gingrich candidacy was and is inevitably doomed. But it’s nonetheless the case that his downfall in the Republican Iowa caucuses is due in significant part to a full-scale, Citizens United-enabled attack advertising campaign.

Restore Our Future, the Super PAC tied to the Romney campaign, has spent more than $4 million on attack ads and negative direct mail targeting Newt Gingrich, according to the Center for Responsive Politics’ tabulations. Led by the Romney-supporting Super PAC (and with an able assist from the Ron Paul campaign), the December surge in TV ads attacking Gingrich in Iowa totaled nearly half of the political ads aired last month in the state. Two thirds of money spent in the Iowa caucuses came from the Super PACs rather than the candidates.

Romney’s Super PAC – like those informally affiliated with Rick Perry, Barack Obama and others – is staffed by friends and former staffers. Election rules permit these Super PACs to raise unlimited amounts from the superrich and – thanks to the Supreme Court’s 2010 decision in Citizens United – corporations. The candidates may help raise money for these Super PACs. Super PACs must reveal their donors on a monthly or quarterly basis, though they accept donations from nonprofit organizations that are not required to reveal their donors (and argue the practice is legal). The main limit on Super PAC activity is that they may not coordinate their activities with the candidates or their campaigns. But this is a more formal than consequential restriction, since the Super PACs are staffed by those who know well what the campaigns want.

The Iowa results illustrate on the national stage what became apparent in the 2010 elections: Post Citizens United, the massive funneling of corporate and superrich money to independent organizations is not just going to favor pro-Big Business candidates. It is going to introduce a new level of viciousness and attack advertising, and remove some of the basic accountability from elections.

That’s because while everyone disparages negative advertising, it works. And attack ads from unaccountable organizations with no real membership work best of all. At least candidates who run negative ads must pay a reputational price for running nasty ads; the independent campaign groups don’t care about their reputation, so aren’t susceptible even to this modest form of accountability.

As the New York Times says, Mitt Romney has “outsourced” his negative advertising to Restore Our Future. Newt Gingrich can complain about negative advertising all he wants, but Romney is not going to be much tarnished by the activities of an outfit called Restore Our Future.

Iowa is just a harbinger of what Election 2012 is going to look like. And it’s not just the presidential race where the effects will be felt; in Senate and House races, and in state and local elections around the country, laundered corporate and superwealthy money threatens to dominate the airwaves and the election debate.

Outside groups reported spending $300 million in the 2010 elections (though the total spent was surely much higher) and exerted huge influence. But $300 million is going seem paltry compared to 2012’s spending. Karl Rove and his Crossroads organizations have announced plans to raise $240 million to spend in the 2012 elections. The Koch Brothers plan to spend $200 million. And there’s no way the U.S. Chamber of Commerce will be outspent by these characters. So, we’re looking at something on the order of three quarters of a billion dollars just from these three corporate-dominated outfits.

All of which presents a simple choice: Accept the further debasement of our democracy, the hijacking of government by giant corporations; or take action to remove the corporate stranglehold tightened by Citizens United.

The way forward is clear, if not easy. We need a constitutional amendment to overturn Citizens United – the pernicious decision holding that corporations have a constitutional right to spend as much as they choose to influence elections – end corporate spending in elections, and clear the way for adoption of a system of public financing for public elections.

January 21 marks the second anniversary of the hideous Citizens United decision. Public Citizen and allies, including Move to Amend, People for the American Way, Free Speech for People and Common Cause, are working with activists around the country to organize protests and events to build a movement for a constitutional amendment to overturn the decision and restore our democracy. Get information on the movement and day of action at DemocracyIsForPeople.Org – and make sure to join (or organize) a protest near you.

It’s the least we can do for Newt. And ourselves.

Robert Weissman is president of Public Citizen.

(c) Robert Weissman

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Excessive Oil Speculation: Wall Street’s Tax on Us

By: Robert Weissman Friday June 17, 2011 11:23 am
Tea Party Protest, Hartford, Connecticut, 15 April 2009 - 048

Tea Party Protest, Hartford, Connecticut, 15 April 2009 - 048 by ragesoss

Where are the anti-tax activists when you need them?

They should be protesting outside of the Commodity Futures Trading Commission, denouncing the agency for failing to take action. And they should be applauding a new legislative proposal by Sen. Bernie Sanders.

Right now, Wall Street speculators are imposing an enormous tax on consumers, and the overall economy.

Where are the anti-tax activists?

There’s no question that illegal, collusive activity is far too frequent in energy markets. But the much bigger problem is legal speculation.

Wall Street speculation in oil and energy markets is jacking up the price of oil, and thereby siphoning money from the pockets and pocketbooks of consumers.

Even Goldman Sachs suggests that legal speculation may be adding 65-70 cents to the price of a gallon of gasoline. Exxon CEO Rex Tillerson says supply-and-demand fundamentals suggest the price of oil should be $65-$70 a barrel, about a third less than the current price. Experts from the home heating oil industry believe even the $65 figure is too high.

The speculation component of the price of gasoline is exactly like a tax on consumers.

Except that it is the worst kind of tax imaginable.

A government imposed-tax on oil or carbon would go to the U.S. Treasury, for use to advance public purposes, such as investing in renewable energy and energy efficiency. By contrast, the proceeds of this Wall Street-imposed tax are going to Wall Street interests, giant oil companies and foreign oil interests. Wall Street gamblers are benefiting from the higher prices in oil markets. The higher prices of oil – which have nothing to do with the cost of drilling or refining – are driving Big Oil’s profits to the stratosphere. The formula for success for Exxon, Chevron, BP and the rest is simple: keep costs constant and reap the profits from prices driven higher by oil speculators. Foreign oil interests get the same benefits – at the expense of worsening the U.S. trade deficit.