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    Veteran foreign correspondent Douglas Birch is joining the Center for Public Integrity’s national security reporting team. Birch has reported from more than 20 countries, covered four wars, a dozen elections, the death of a pope and the hunt for a malaria vaccine. He formerly served as the Moscow bureau chief for the Associated Press and spent 22 years at the Baltimore Sun.

    “I can’t think of another journalist better than Doug Birch to help the Center dig into nuclear and proliferation dangers, investigate fraud and abuse in military spending, and explain how Capitol Hill makes defense-spending decisions,” said Executive Director William E. Buzenberg. “He’s an excellent addition to our already strong reporting team, led by National Security Managing Editor R. Jeffrey Smith, a Pulitzer Prize-winning former Washington Post reporter.”

    Birch was the AP’s diplomatic and military editor in Washington, following his work in Moscow from 2001 to 2005 and from 2007 to 2010. At the Baltimore Sun, he was an enterprise, feature and science writer. Birch was a Pulitzer Prize finalist in 2002 for his series on the abuse of human subjects in drug trials. A graduate of Columbia University and its graduate journalism school, he was also a Knight science journalism fellow at MIT.

    Birch lives in Baltimore with his wife, Jane, who works for a Baltimore charitable foundation. His daughter Alison is an architect living in Charleston, S.C. He begins at the Center on Jan. 22nd.

    The Center for Public Integrity is a nonprofit, nonpartisan and independent news organization specializing in investigative journalism on significant public policy issues. Since 1990, the Washington, D.C.-based Center has released more than 500 investigative reports and 17 books to provide greater transparency and accountability of government and other institutions.


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    The Obama administration has quietly arranged for thousands of chemical protective suits and related items to be sent to Jordan and Turkey and is pressing the military forces there to take principal responsibility for safeguarding Syrian chemical weapons sites if the country’s lethal nerve agents suddenly become vulnerable to theft and misuse, Western and Middle Eastern officials say.

    As part of their preparations for such an event, Western governments have started training the Jordanians and Turks to use the chemical gear and detection equipment, so they have the capability to protect the Syrian nerve agent depots if needed – at least for a short time, U.S. and Western officials say.

    Washington has decided moreover that the best course of action in the aftermath of Syrian President Bashar al-Assad’s fall would be to get the nerve agents out of the country as quickly as possible, and so it has begun discussions not only with Jordan and Turkey, but also with Iraq and Russia in an effort to chart the potential withdrawal of the arsenal and its destruction elsewhere.

    Using allied forces from Syria’s periphery as the most likely “first-responders” to a weapons-of-mass-destruction emergency is regarded in Washington as a way to avoid putting substantial U.S. troops into the region if the special Syrian military forces now safeguarding the weapons leave their posts. A Syrian withdrawal might otherwise render the weapons vulnerable to capture and use by Hezbollah or other anti-U.S. or anti-Israeli militant groups, U.S. officials fear.

    This article is based on conversations about international planning for the disposition of the Syrian stockpile with a half dozen U.S. and foreign officials who have direct knowledge of the matter but declined to be named due to the political and security sensitivities surrounding their work. They said the Western planning, while not yet complete, is further along than officials have publicly disclosed.

    But so far, the Turkish and Jordanian governments have not promised to take up the full role that Washington has sought to give them, U.S. and foreign officials said.

    Asked for comment, Jordanian embassy spokeswoman, Dana Zureikat Daoud, said the training under way is “not mission-oriented,” meaning that Jordan does not have a fixed responsibility. But she added that the government is indeed concerned about the possibility of Syrian chemical armaments falling into extremist hands. “Our contingency plans … are discussed and elaborated with like-minded, concerned countries,” she said.

    A spokesman at the Turkish Embassy declined comment. But James F. Jeffrey, the U.S. ambassador to Turkey from 2008-2010, said that although Ankara is eager for the United States to play a larger role in resolving the Syrian crisis, the Turks are “usually reluctant to be our foot-soldiers.” He added: “When Americans come up with a plan to use country x’s soldiers, the plan is often self-fulfilling inside the Beltway,” but sometimes runs into trouble when it is broached in foreign capitals.

    The prospect of lethal nerve agents at any Syrian sites suddenly becoming unprotected is one of many alarming developments that have been war-gamed at the Pentagon over the past year, as the conflict there deepens and president Assad’s grip over his deadly arsenal comes into greater question, U.S. officials say.

    Worries about the fate of the chemicals – in a stockpile estimated at 350 to 400 metric tons -- have become so great that Washington and its allies have recently passed messages to some of the Syrian commanders that oversee their security, offering safety and a continued role under a new government if the commanders act responsibly, two knowledgeable officials said on condition they not be named.

    It is unclear what the results of that effort have been. But similar messages, urging restraint and good behavior in handling the chemicals, have also been passed in recent weeks to rebel forces inside the country, according to a Western official.

    One of Washington’s concerns has been that Assad might order the chemicals used against his own citizens, a fear that spiked late last year when chemicals at one base were seen being loaded into artillery shells and bombs. Western and Russian officials issued stiff warnings, and those concerns abated somewhat, although Foreign Policy magazine reported Jan. 15 that some evidence exists that Syria used a generally nonlethal incapacitating gas against rebels in Homs last month.

    “We found no credible evidence to corroborate or to confirm that chemical weapons were used” in that incident, State Department spokeswoman Victoria Nuland said on Jan. 16.


    Top priority is protecting the sites

    The principal U.S. concern in a post-Assad period, Secretary of Defense Leon Panetta said at a press briefing on Jan. 10, is “how do we secure the CBW (chemical and biological weapons) sites?...And that is a discussion that we are having, not only with the Israelis, but with other countries in the region, to try to look at … what steps need to be taken in order to make sure that these sites are secured.”

    “We’re not working on options that involve (U.S.) boots on the ground,” Panetta said.

    At one extreme, officials said, special forces now in the region might have to intervene on short notice if it appears that weapons at one of the sites are about to fall into the wrong hands or to be employed on a large scale. They would be tasked with swiftly neutralizing both the agent and any hostile forces present and likely stay on the ground only for a few hours.

    The Obama administration’s preference is to have other nations’ forces undertake such an intervention, and so the United States and Britain have been conducting joint planning and training operations with Jordanian and Turkish commandos for more than a year, to prepare for their possible emergency insertion into Syria, according to U.S. and foreign officials familiar with the plans.

    The protective suits, along with detection equipment and decontamination gear, began arriving in the late fall amid concern that the Syrian government might be considering using the weapons to halt rebel advances. Syria’s arsenal – which was developed for a potential conflict with Israel -- includes mustard gas, which burns and blisters the skin and lungs, More problematically, it also includes sarin and VX, liquids that interfere with the nervous system and produce swift death by paralysis after minute, drop-size exposures, U.S. officials say.

    Syria devised its nerve weapons as binary agents, in which two less toxic chemicals are routinely stored in large, separated canisters and then loaded into separate compartments inside a bomb. For example, sarin uses a formulation of alcohol, plus another chemical. The agents combine to pose their most lethal threat only when launched or during flight, making them relatively easy to handle or transport before then – by the Syrian military or by terrorists and militant groups.

    But the separation of the basic components also opens the door to at least a partial elimination of the threat onsite, since the alcohol used in sarin could simply be drained onto the ground and allowed to evaporate.

    Jordan and Turkey initially agreed to undertake Western training in dealing with chemical weapons because they might have to deal with panicked refugees and victims if Assad’s forces use such arms against the rebels; some risk also exists in that circumstance of clouds of dangerous gas wafting onto their own territory from Syrian cities near their border. Even medical workers would be at grave risk in dealing with those who became contaminated; as a result, they are being trained now by Western powers, according to foreign officials.

    “Their primary concern is a spillover of these things into their territory,” one U.S. official said. The salience of this worry was demonstrated when a Syrian mortar round crashed into a Turkish field near a refugee camp on Jan. 14. As Daoud, the Jordanian spokeswoman, said, “Naturally, we will do everything that needs to be done to defend our people and our borders.”

    Partly because of worries about the stockpile’s security, Washington and its allies still hope that Assad might be persuaded to leave in exchange for a guarantee of his personal security elsewhere. In such a negotiated transition, Western powers would seek to keep the existing Syrian military units responsible for safeguarding the chemical weapons sites in place, officials said.

    “The people in Assad’s regime responsible for security at the chemical sites are among the very best soldiers,” a U.S. official said. “If one could keep those forces in place … that would be the best and probably the cheapest and most efficient outcome.”

    But Assad, in a defiant address on Jan. 6, said he had no intention of stepping aside or negotiating with the rebels engaged in a bitter struggle for national control that so far has claimed at least 60,000 lives.

    “We’re engaged in planning to develop options against alternative futures … (including) collaboration or cooperation, permissiveness, non-permissive, hostile, all of which would have different requirements,” Joint Chiefs of Staff chairman Gen. Martin Dempsey said at the Jan. 10 briefing.

    Getting the chemical weapons out of Syria

    “The options are not good in any scenario,” said another senior official, adding that Washington is as worried about the chemicals falling into the hands of rebel forces that may seize power, either locally or nationally, as it is about their misuse by terrorists or by rogue Syrian military units and commanders. At least one of the major Syrian rebel groups, Jabhat al-Nasra, has been designated by the United States as a terrorist organization.

    Also, U.S. intelligence agencies have warned policymakers that once Assad is gone, the country’s turmoil will increase, with rival groups potentially seeking to brandish possession of the chemical weapons as symbols of their power. Officials said that as a result, they have pressed the Syrian National Coalition, a rebel group recognized by Western countries, to appoint a coordinator now for all chemical weapons-related policymaking and negotiations.

    Simply blowing up the chemicals inside Syria with bombs or other weapons is not an option, as Panetta made clear in a briefing for reporters during a December visit to Turkey: He said the plumes from such explosions would cause “exactly the kind of damage” that would result from the weapons’ deliberate use.

    Incinerating the chemicals inside Syria would be logistically challenging and pose high security risks, since Western countries have only a few portable destruction kits for chemical weapons, developed primarily to deal with single, leaking shells, not large stocks.

    As a result, U.S. officials said they would likely seek to transport the chemicals out of Syria as quickly as possible once a new government can be formed, preferably under the supervision of the United Nations-affiliated Organization for the Prohibition of Chemical Weapons, with the new government’s formal approval.

    “We maintain regular communication with States Parties as well as the United Nations on developments in Syria and continue our efforts to prepare for various scenarios which could potentially involve the OPCW in that situation,” said OPCW spokesman Michael Luhan.

    Under one scenario now under discussion between Washington and its allies, the chemicals would be moved to secure military bases in Jordan, Turkey or Iraq, where the United States and others would erect chemical incinerators over a six- to 12-month period that could destroy the bulk agent in a year or so after that. Using similar incinerators to destroy a small stockpile of chemical weapons in Albania more than five years ago cost $48 million.

    But even this task would be logistically awkward, not to mention politically controversial in those states. Undertaking it would first require further consolidation of the stocks inside Syria and then their transport outside the country in hundreds of truckloads.

    Another option, which officials said has tentatively been explored with senior Russian officials, is to truck the chemical agents to the Syrian port of Tartus, where the Russian Navy keeps a small presence, so that the arsenal could be placed on a ship for transport to Russia, where multiple chemical weapons destruction plants have been constructed with Western help.

    By the accounts of several officials, Russia has expressed some desire to help. And Western officials emphasized that in their view, the country has a special responsibility to do so, because of reports that the head of its chemical weapons program helped Syria obtain key VX components in the early 1990s.

    No final policy choice has been made about these options, senior officials said. And bringing a large weapons stockpile into Turkey or Russia – which are signatories of an international treaty barring use or possession of chemical arms – might require a waiver of the treaty’s rules against importing even the components of such weapons.

    Some consolidation of the Syrian arsenal has already occurred on Assad’s orders, and the bulk of it is now at fewer than a dozen sites, according to a U.S. official familiar with intelligence estimates.

    But U.S. military planners are unsure precisely how many sites might hold deadly chemicals at the point that a foreign intervention would be necessary or feasible. If Assad disperses the arsenal beforehand to the 40 or so military bases with aircraft or missiles that can drop or launch the weapons, as many as 75,000 foreign troops could be needed to contain the threat (several thousand troops at each base, according to this worst-case estimate). A smaller number would be needed if the intervention preceded such a dispersal.

    The shipment of protective gear to Syria’s periphery from U.S. and British stockpiles was an acknowledgement of the enormity of the problem, several officials said. They described thousands of pieces of chemical-protection gear -- from masks and suits to detectors and decontamination kits -- being pre-positioned in Jordan alone.

    Asked for comment, Joint Chiefs of Staff spokesman Scott McIlnay responded that “we have always said that contingency planning is the responsible thing to do, and we are actively consulting with friends, allies and the opposition. But I am not going to get into the specifics of our contingency plans.” Pentagon spokesman Bryan Whitman said he could only say that “we are working with our partners in the region and the broader international community to monitor the situation and discussing contingencies.” 


    People gather around destroyed buildings after airstrikes that targeted Aleppo, Syria.R. Jeffrey Smithhttp://www.publicintegrity.org/authors/r-jeffrey-smithhttp://www.publicintegrity.org/2013/01/17/12033/us-seeks-outsource-handling-syrian-chemical-weapons

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    As lawmakers in three Southeastern states prepare for the 2013 legislative session, they’re finding bipartisan agreement on an unlikely agenda: ethics reform. Leaders in South Carolina and Florida have begun work that lawmakers and watchdogs say could lead to the states’ first meaningful reforms in decades. And in Georgia, proponents of stronger rules are rallying behind a slate of measures they hope may finally pass in what has long been a recalcitrant Legislature.

    The initiatives all seek some regulation of money and influence. The proposals take aim at independent political spending, asset disclosure and gifts from lobbyists in an effort to bolster transparency and rein in the spiraling costs of running campaigns. In some cases the reforms could go deeper, as lawmakers try to attack the roots of corruption by strengthening ethics oversight and enforcement.

    “There’s been a real sea change in terms of the atmosphere around ethics reform,” said Josh McKoon, a Republican state senator in Georgia, which ranked last among the states for corruption risk in 2012’s State Integrity Investigation—a collaboration of the Center for Public Integrity, Global Integrity and Public Radio International.

    Lawmakers in several other states — Missouri and Idaho among them — have said they may push reform in the 2013 session. But nowhere does it appear as likely as in the Southeast, where several factors, including a series of scandals, have pushed the issue onto the public agenda. Good-government groups and legislators in each of three states have used their rankings in the State Integrity Investigation to argue for substantive changes. Georgia and South Carolina received failing grades, and Florida received a C-minus.

    But critics caution that this isn’t the first time politicians in these states have called for change, and much of the talk could prove to be just that. Apart from a narrow rule change in Florida, policymakers have taken few actions beyond voicing grand but general commitments to reform and creating several commissions to examine the issue. Georgia’s movement is being pushed by second-term legislator McKoon, who failed to rally much support last session. And while observers in Florida and South Carolina say they fully expect legislators to cast votes on reform bills in this session, the long legislative process could still whittle them down to little more than weakened gestures.

    South Carolina

    It’s perhaps an understatement to say that South Carolina state government has had a bit of an image problem in recent years. First, in 2009 then-Gov. Mark Sanford absconded to Argentina on a romantic affair that eventually led to his paying a $74,000 fine to settle ethics charges. Last March, a state judge sentenced Lt. Gov. Ken Ard to five years’ probation and levied a $5,000 fine after Ard pleaded guilty to charges that he mishandled campaign money in the 2010 election. More recently, House Speaker Bobby Harrell has been accused of pocketing campaign funds by labeling them as reimbursements. And then there was the F from the State Integrity Investigation

    “A lot of those things have all generated a real push for some meaningful ethics reforms,” said GOP state Sen. Wes Hayes, who recently left his position as chairman of the Senate Ethics Committee to take a more senior leadership post. A recent poll found that a majority of South Carolinians support strengthening ethics laws.

    In her State of the State address on Jan. 16, Republican Gov. Nikki Haley cited South Carolina's failing grade from the State Integrity Investigation as evidence of the need for reform.

    "Every single one of us knows that's not good enough," she said, "that the people of South Carolina deserve better, and that is our responsibility—no, that is our obligation—to give it to them." 

    Four panels are holding hearings and readying recommendations for reform legislation: one appointed by Haley; one Senate committee led by Hayes; and two House panels, one formed by each party.

    All four are likely to address campaign finance this session, which began January 8. As a result of a 2010 federal court ruling, South Carolina has no effective limits on independent expenditures. In the 2012 campaign, Hayes and other incumbents suffered withering attacks in television ads paid for by groups with money from anonymous donors, which led to a bipartisan consensus to address the gaps brought about by the court decision.

    John Crangle, director of Common Cause South Carolina, said the abundance of unlimited, anonymous campaign spending through independent groups has driven up the cost of running for office. “There’s a lot of concern that ordinary people are just being frozen out of the process,” he said. “It’s the Wild West.”

    Another top concern: ethics oversight. An independent Ethics Commission enforces the rules for many state officers, but lawmakers are not among them. The state constitution gives legislators the right to “punish its members for disorderly behavior.” Although there’s debate over whether this is an exclusive right, legislative committees have always handled ethics complaints against lawmakers. Crangle said this practice can lead to conflicts of interest. While the House Ethics Committee is charged with investigating the complaint against Harrell, for example, each of the Republicans on the committee has accepted donations from his leadership PAC. (This session, the House Ethics Committee will consist of five members of each party, rather than five Republicans and one Democrat, as it did last session.)

    Some officials have proposed allowing an independent body to investigate ethics complaints for all branches of government. Investigators would then forward recommendations to either the House or Senate Ethics Committee — for complaints against legislators — or to the Ethics Commission — for everyone else — to get a final ruling. Such a system would lend a degree of independence to investigations without requiring an amendment to the state constitution.

    Hayes said such a body could help alleviate the burden on the chronically underfunded Ethics Commission, which has seen its annual budget appropriation cut from $725,000 in 1999 to less than $323,000 last year. “You can pass laws till you’re blue in the face,” Hayes said, “but if you don’t have anyone to enforce them, it doesn’t really mean much.”

    It’s unclear what shape such an independent body would take, though, or how it would be paid for. And it would likely face limits on what it could investigate, said Kenny Bingham, chairman of the House Ethics Committee.

    One proposal, from the attorney general, calls for a public integrity unit comprising officials from five agencies, including the Ethics Commission. The unit would draw on existing funding to the agencies and therefore not require new revenue. It would not accept complaints, but would rely on legislative committees to pass on cases that they currently investigate on their own.

    Another option would give the investigative power to the Ethics Commission. Cathy Hazelwood, general counsel for the commission, said it’s too soon to say what that would cost but guesses that it would require a minimum of two additional staff members, or at least $150,000 more a year. Crangle said that coming up with the money might be easier now that revenue has been increasing as the economy improves. Legislators have also proposed increasing registration fees for lobbyists, which together with other fees generate most of the commission’s budget.

    But none of these steps go far enough, according to the editorial board of The State, one of South Carolina’s leading newspapers. In a December editorial, the paper argued that legislators must give up the power to sanction their peers: “That’s what will restore the public’s confidence that our legislators are working for the good of our state rather than the good of themselves.”

    Haley has said she will endorse the recommendations of the panel she appointed — headed by two former attorneys general — whether or not she agrees with them. Hayes said the Senate committee will wait to learn that panel’s recommendations, which are expected in late January, before issuing its own. Lawmakers will then need to turn the recommendations into legislation.

    “The big problem will be whether the General Assembly does anything about it,” Crangle said, adding that he doubts that Speaker Harrell will back meaningful reforms. “There’s going to be a hell of a lot of resistance.”

    Harrell’s office did not respond to requests for comment. He has not spoken extensively on the issue but did comment for a press release that accompanied the announcement of the House committees in October. “These reforms and added transparency efforts will help ensure the public that our ethics laws are being followed and enforced,” he said, “making it much more difficult for members to be unfairly attacked for actually complying with the law.”


    Florida has not suffered the same level of high-profile scandal that South Carolina has, but the reform movement there has been growing over the past few years. Tea Party activists supported Gov. Rick Scott’s run for office in 2010 in part because of what they thought was his commitment to ethics and transparency. Scott issued an executive order after his election that established a new code of ethics, but he has not pushed for major legislative reforms. His commitment to the issue could finally be tested, though, because the new leaders of the House and Senate have begun their tenures by highlighting ethics.

    Both the incoming Senate President Don Gaetz and newly appointed Speaker Will Weatherford, both Republicans, have said repeatedly over the past few months that they will push ethics reforms this session, which begins March 5. Weatherford re-created the House Ethics and Elections Committee for the first time in six years and has said he wants to rein in independent campaign groups.

    Gaetz took the first steps toward reform by pushing through new conflict-of-interest rules in the Senate, which members approved in an organizational meeting in November. The rules prevent senators from voting on matters if they could have a “special private gain” from the vote. The idea is to prevent senators from voting on bills that affect specific companies in which they have a financial interest without preventing them from voting on a measure affecting an entire industry they have some connection with. Senators must also take “every reasonable effort” to disclose their conflicts before a vote. Previously, they were allowed to vote on matters whether or not they had a conflict of interest and were required to disclose the conflict only after the fact.

    Because the reforms were passed as Senate rules, and not law, it will be up to legislators themselves to resolve any disputes over the disclosures. Dan Krassner, executive director of Integrity Florida, an independent watchdog group, said his organization will push for the Legislature to write the new rules into law, which would allow citizens to register complaints with an outside body.

     “An independent ethics enforcement agency or the Florida Commission on Ethics would be a stronger enforcement policy than lawmakers’ own colleagues,” he said.

    Lawmakers have also expressed support for a couple of changes that the Ethics Commission, which enforces the state’s ethics laws, has been requesting for years. One would strengthen the commission’s ability to collect unpaid fines for late financial disclosure forms. The other would allow it to take referrals of ethics complaints from other state agencies. Currently, the commission can initiate an investigation only if it receives a sworn complaint, a fact that contributed to the state’s F grade for its ethics enforcement agencies from the State Integrity Investigation. Under the present system, a complainant cannot remain anonymous and can be held liable for legal fees if the complaint contains false allegations. Referrals would allow officials, such as state attorneys, to accept anonymous complaints and conduct initial investigations before sending them to the Ethics Commission. Because no one has introduced specific plans, however, no one knows how much such a change would cost.

    Many of the steps may appear incremental, Krassner said, but they represent a notable change nonetheless. “It’s been 36 years,” he said, “since Florida has had its legislative leaders talking about ethics reforms.”

    On Jan. 15, the Senate Ethics Committee began drafting a sweeping bill that could include several of these proposals. The committee will vote on the measure soon to send a version to the full chamber in March.

    Some advocates of stronger reforms remain skeptical, however. Beth Rosenson, an associate professor of political science at the University of Florida, said the most important reform would be to give the Ethics Commission the power to initiate investigations on its own, a move the Legislature has never supported. The compromise of accepting referrals, she said, is “not quite good enough.”

    And Henry Kelley, a local Tea Party activist, said he doesn’t think the new Senate rules will produce much change. Legislators are required to disclose their sources of income, but no one audits the disclosures. “If somebody doesn’t want to play by the rules,” he said, “it’s rather easy to do that.”

    Legislators are required to report only a snapshot of their finances, which means that a senator could sell company shares worth millions of dollars the day before filing and the transaction wouldn’t appear in the disclosure report. A legislator could also vote on a bill one day and then enter into a financial relationship with an affected company the next, and no one would know. Krassner said he’ll urge legislators to change this loophole.

    Kelley is not optimistic about what he sees as the most important problem: eliminating so-called committees of continuous existence, opaque campaign funds that legislators can use to raise and spend unlimited amounts of money. “I can’t buy a guy dinner, but I can hand him an envelope with $10,000 in it,” he said, citing the state’s ban on gifts from lobbyists. “It gives the impression of ethics laws, without the teeth.”

    Weatherford and Gaetz have said they support banning the committees, perhaps in coordination with raising the current $500 cap on individual donations to candidates. But Kelley doubts the measure will pass this session, and no one is discussing tightening rules on lobbyist disclosure, which the State Integrity Investigation identified as a weak spot. “That’s another area where Florida has room for improvement,” Krassner said.

    The prevailing view from reform advocates is that all of the talk coming out of election season will face a major test once the session begins. “As realists, we doubt that Florida’s Legislature is about to enter the Promised Land of campaign finance reform,” The Palm Beach Post wrote in a recent editorial. “But if Rep. Weatherford and Sen. Gaetz want to lead Tallahassee in that direction, let’s go along for the ride.”


    According to the State Integrity Investigation, no state has more room for improvement than Georgia, which ranked dead last on corruption risk. Legislators are not required to disclose gifts they receive from lobbyists (though lobbyists are supposed to report them). Open records laws don’t cover the legislative or the judicial branch.

    The State Integrity Investigation overview page paints a troubling picture of the relationship between government and industry in the Peach State. “Executives of insurance companies, public utilities and other regulated entities have become the largest single source of campaign money for regulators running for re-election,” it says. “Utility officials raise money and work to help re-elect incumbents; a lobbyist for the cable TV industry managed one incumbent’s campaign in 2008.”

    For several years, the Georgia Alliance for Ethics Reform, a coalition of liberal and conservative activists,  has been pushing for ethics reform with little success. Alliance members came up with a 26-point plan that they proposed in 2011, said William Perry, executive director of Common Cause Georgia, but no legislators adopted the cause.

    Last session, however, the movement started gaining traction. Sen. McKoon began pushing for several measures in his first term, albeit with little success. Local news outlets covered the issue and eventually published several columns and editorials. Then, McKoon and Perry said, the state’s ranking in the State Integrity Investigation helped transform ethics into a campaign issue last year. “People said, ‘We hear Georgia was worst in the nation in ethics, what do you intend to do about that?’ ” Perry said.

    The central issue now is a possible cap on gifts from lobbyists, which currently have no limits. In 2010, for example, lobbyists funded a $17,000 trip to Europe for GOP House Speaker David Ralston and his family to learn about high-speed rail projects. “We’ve seen an explosion in the amount of money that’s being spent on the General Assembly,” McKoon said. Georgia lobbyists spent $1.4 million last year. “That’s distressing.”

    McKoon and the activists were able to get nonbinding resolutions calling for a cap on gifts on the July primary ballots last year, and an overwhelming number of voters supported the measures. An editorial in the Columbus, Ga., Ledger-Enquirer said it sent an “unmistakable” message to lawmakers. “Georgians want their political leaders to be accountable to the citizens who elect them, not to the moneyed interests that fund their campaigns and coddle them once they're in office.”

    Now Common Cause and other groups are pushing for a $100 limit on each gift. On Jan. 14, the first day of the session, the Senate passed a rule implementing a $100 cap on gifts from lobbyists. The rule contains several loopholes, however, including an exception for travel and lodging for events as long as they are "related to the Senator's official duties." McKoon said that legislators are likely to introduce several bills in the coming months to write a $100 cap into law.

    Perry said that after a gift cap, his second priority is to restore the Government Transparency and Campaign Finance Commission’s rule-making authority and to push to provide more money to the body. In 2009, the legislature stripped the commission of its ability to write new rules. One result is that the commission has been unable to collect all of the late filing fees that legislators owe. If a lawmaker fails to submit a disclosure report, for example, the late fee increases as time goes on. State law says the commission must inform the lawmaker by certified mail before increasing the fine. However, the legislature has not given the commission the money for postage, and therefore many fines are simply not collected, Perry explained.

    Lawmakers have cut the commission’s budget by more than 40 percent since 2008, more than it has for any other agency, Perry said. It’s become clear, he said, that the commission needs money for things such as office supplies and new computers, but many lawmakers remain reluctant to increase funding. “The whole thing boils down to the fact that they don’t want to open up the can of worms, because everything else can come with it.” The cuts have effectively reduced oversight by preventing the commission from fulfilling its duties, and that suits some lawmakers just fine, Perry said. “We have those great laws, but our commission has no ability to carry them out.”

    For this session, McKoon has pre-filed bills to amend the state constitution to ensure permanent funding for the Government Transparency and Campaign Finance Commission and to allow the attorney general to call for grand juries to investigate corruption cases. McKoon’s funding amendment would provide 0.00025 percent of the annual budget to the commission, which for 2013 would work out to roughly $4.5 million, four times what the body currently receives. Other possible bills would call for more-stringent revolving-door rules for outgoing public officials and expand open records laws.

    The new senate president pro tempore, David Shafer, has said he’ll support the gift restriction, but he recently gave a less full-throated endorsement of broader reform to The Atlanta Journal-Constitution.“It is important that we have strong ethics laws, but in the end, ethical behavior comes from within the individual,” he told the newspaper. “There is only so much that laws and rules can do.”

    While many of these measures may not pass, advocates for reform say there’s a marked shift. “We’re literally going zero to 60 in two legislative sessions,” Perry said. When the coalition began its effort the session before last, they weren’t able to get a single bill introduced. “Now ethics is poised to probably be the No. 1 issue in the session.”

    During her 2013 State of the State address, Republican Gov. Nikki Haley made several mentions of the South Carolina's multiple "F" grades from the State Integrity Investigation.Nicholas Kusnetzhttp://www.publicintegrity.org/authors/nicholas-kusnetzhttp://www.publicintegrity.org/2013/01/18/12042/lawmakers-southeast-call-ethics-reform

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    President Barack Obama has long vowed to “take on” federal lobbyists, swearing off their campaign cash, curtailing access to his administration, and lately, directing his Presidential Inaugural Committee to reject their donations.

    “We've always relied on each other, not Washington lobbyists or corporate interests, to build our campaign,” he wrote to supporters after launching his re-election campaign.

    While Obama has banned donations to his second inaugural celebration from lobbyists, no such prohibition exists on donations from the corporations that employ them.

    Donate they have: Obama’s inaugural festivities Monday are bankrolled by several of the nation’s most powerful corporate lobbying forces, which have collectively spent at least $158.6 million on lobbying since the president first took office, a Center for Public Integrity review of congressional disclosures indicates.

    The ceremony on the steps of the U.S. Capitol, perhaps fittingly, falls squarely on the third anniversary of one of the most notable political influence developments in U.S. history — the Supreme Court’s Citizens United decision— which Obama decried as a “huge victory” for special interests and their lobbyists and a “powerful blow to our efforts to rein in corporate influence.”

    Chief among corporate inaugural donors: AT&T Inc., Microsoft Corp., energy giant Southern Co., biotechnology firm Genentech and health plan manager Centene Corp. Together, more than 300 registered lobbyists worked on the five companies’ behalf to influence legislation and government policy, according to their latest federal filings covering January through September.

    Among numerous other influence efforts, Southern Co. lobbied the Executive Office of the President to curtail environmental regulations. AT&T pressed the Treasury Department to extend research and development tax credits and lobbied heavily — and unsuccessfully — to win regulatory approval of a merger with rival T-Mobile. Microsoft targeted the Justice Department, Federal Communications Commission and U.S. Copyright Office for support in strengthening online piracy and intellectual property regulations.

    Together, the companies last year hired a constellation of K Street’s top lobbying firms to supplement in their own in-house advocates. The firms include Akin Gump Strauss Hauer & Feld, Alston & Bird, BGR Group, Capitol Counsel, Cassidy & Associates, Crossroads Strategies, Patton Boggs, Prime Policy Group, Van Scoyoc Associates and Wiley Rein.

    Former members of Congress and high-ranking state politicians now employed by the influence industry pepper their ranks. They include Senate Majority Leader Trent Lott, R-Miss.; Sens. John Breaux, D-La., Jim Slattery, D-Neb. and Don Nickles, R-Okla.; Reps. Vic Fazio, D-Calif., Jim McCrery, R-La. and Henry Bonilla, R-Texas; and Mississippi Gov. Haley Barbour, a Republican.

    Second term, no limits

    Obama banned corporate contributions to the committee organizing his first inauguration and limited individual donations to $50,000. But for his second inauguration — a somewhat scaled-down affair expected to attract hundreds of thousands fewer revelers — most corporations and individuals are allowed to contribute unlimited amounts of money.

    For both inaugurals, Obama barred contributions from political action committees, foreign governments, political parties, registered foreign agents or anyone under the age of 16 and federally registered lobbyists.

    The committee is also not accepting individual or corporate sponsorships and companies that haven’t yet repaid Troubled Asset Relief Program funds are likewise blacklisted.

    The inaugural committee released a statement in response to questions about the shift in contribution policies.

    “The inaugural is a civic event and our guidelines aren’t just consistent with the law — they are consistent with the president’s commitment to transparency and to reducing the influence of PACs and lobbyists in Washington.”

    The inaugural committee, which fundraises for and coordinates events including the inaugural parade, concerts, official balls and a prayer service, has maintained a twice-updated list of contributors on its website.

    As of early Friday, it included eight corporations, although that list may soon grow.

    Other businesses sponsoring the inaugural include United Therapeutics Corp., a pharmaceutical firm; Financial Innovations, Inc., a marketing firm that produced Obama campaign promotional products and Stream Line Circle LLC, which is controlled by Jon Stryker, a businessman and gay rights activist who last year donated $2 million to pro-Obama super PAC Priorities USA Action.

    Stryker Corp., a medical products company of which Stryker is a minority owner, has spent more than $816,000 on federal-level lobbying since Obama became president, including lobbying the White House against a medical device tax, federal disclosures show.

    The roughly 1,000-name online list, which the committee says is slated to again be updated Friday, provides significantly less information than a similar list published online by Obama’s 2009 inaugural committee, which wrote of its desire to “provide the most open and accessible inauguration in history” and the president’s “commitment to change business as usual in Washington.”

    Current inaugural policy also illustrates the sometimes wild swings in donor disclosure levels from inaugural to inaugural, which is largely determined by the committee itself, not the federal government.

    While it’s known which companies and individuals are making contributions to support the event, how much they gave remains a mystery. Nor does the inaugural committee provide information beyond a company or person’s name. This makes it difficult, if not impossible, to confirm the identities of contributors such as “Timothy Adams,” “Michael Johnson” and “Ryan Smith.”

    Gone for Obama is the voluntary, pro-inaugural disclosure of donors’ location, Zip codes, occupations and employers — disclosure levels somewhat akin to those of President George W. Bush’s inaugural committees.

    Don’t wait up late for Obama’s information, either. His committee isn’t required to provide a full and public accounting of its finances to the Federal Election Commission until 90 days after the inauguration.

    ‘Pleased to participate’

    Some corporate inaugural donors say they are driven by civic responsibility, even though, arguably, their money could have greater political effect if given to super PACs or, for that matter, used to hire more lobbyists.

    Southern Co.’s donation, which the company confirms is worth $100,000, was made to support “the celebration of the presidency and the activities of the inaugural committee,” spokesman Tim Leljedal said. “This is always a very special time for our country and we are pleased to participate.”

    In a statement, Genentech said it aims to play a “positive role in the communities in which we live and operate” and “is proud to provide support for the presidential inauguration.”

    Microsoft officials refused to comment about the company’s contribution, while officials for AT&T, Centene Corp., United Therapeutics, Financial Innovations Inc. and Stream Line Circle LLC did not reply to repeated requests for comment.

    Microsoft and AT&T are also federal contractors, as USA Today noted, and while it’s illegal for such contractors to influence federal elections, they’re not banned from donating to inaugural committees unless the committee itself does the banning.

    Meanwhile, Obama’s inauguration donor policies and practices have managed to agitate an eclectic cross-section of politicos, liberal and conservative.

    David Bossie, president of Citizens United, the conservative activist group that prompted the eponymous Supreme Court decision, called the president’s decision to accept corporate cash “cynical” and “hypocritical.”

    “He talks out of both sides of his mouth,” Bossie said. “I’ll be interested to look back to see what those companies are getting back in return.”

    Some, at least, will receive an immediate return on their investment, as the committee confirmed that companies donating at least $1 million will receive a variety of inauguration day perks including choice viewing seats and inaugural ball tickets.

    Corporations contributing at least $100,000 level also get ball tickets.

    For Bruce Freed, president of the Center for Political Accountability, which aims to “bring transparency and accountability to corporate political spending,” corporations donating to Obama’s inaugural committee have “tremendous interests and influence and want to be heard in D.C.

    “The administration,” Freed said, “should be very sensitive to opening up the door to corporate influence like this and the perception and risks associated with it.”

    Monte Ward, president of the American League of Lobbyists and head of Advanced Capitol Consulting, says he’s “very disappointed” that Obama would accept unlimited contributions from corporations that lobby but not from individual lobbyists themselves.

    Even commemorative inaugural tchotchkes — from a $20 baby onesie to a $7,500 medallion set featuring the likenesses of Obama and Vice President Joe Biden — are off-limits to the registered influence industry set because paying for them is considered a donation.

    “He’s still singling out lobbyists. It’s unfounded. But we wouldn’t expect anything less,” said Ward, ticking off Obama’s perceived affronts to professional lobbyists, from prohibiting them from volunteering on executive branch advisory committees to signing a presidential order tightly restricting their hiring for administration jobs.

    The president’s battle against lobbyists – donations from corporate lobbying entities or not — doesn’t appear to be over, either.

    In May, Obama campaign Chief Operating Officer Ann Marie Habershaw boasted that it didn’t accept “any money from Washington lobbyists or corporate-interest groups — not a dime. We don't want them owning any piece of this campaign or expecting any special consideration.”

    And on the still-active Obama website Change.gov, a forerunner to WhiteHouse.gov, the ethics section prominently features a quotation from the president made while campaigning in 2007.

    “I am in this race to tell the corporate lobbyists that their days of setting the agenda in Washington are over,” Obama said. “I have done more than any other candidate in this race to take on lobbyists — and won. They have not funded my campaign, they will not run my White House, and they will not drown out the voices of the American people when I am president."

    In this Jan. 20, 2009 photo, President Barack Obama and first lady Michelle Obama walk the inaugural parade route in Washington.Dave Levinthalhttp://www.publicintegrity.org/authors/dave-levinthalhttp://www.publicintegrity.org/2013/01/18/12050/obama-inauguration-sponsors-spent-millions-influencing-government

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    Maryland lawmakers are sponsoring legislation to prevent Baltimore-area residents from losing their homes for failing to pay small municipal water bills —a stunning scenario detailed in a Center for Public Integrity story.

    The legislation is aimed at preventing a repeat of what happened to Vicki Valentine, a Baltimore woman who lost her family’s mortgage-free home over what began as an unpaid water bill of $362. The Center told Valentine’s story in 2010 as part of an investigation into the impact of tax-lien sales on struggling property owners.

    Counties in Maryland, like many other states, sell investors the right to collect unpaid property taxes and other municipal debts of $250 or more at auctions, which often are conducted online and can draw investors from all over the world. The law in Maryland allows lien holders to charge double-digit interest rates and in some cases tack on thousands of dollars in fees. Homeowners who fail to pay may face foreclosure on their property.

    But the new bill introduced earlier this week in the Maryland General Assembly would prohibit tax collectors in the City of Baltimore and suburban Baltimore County from including residential property in the tax sale when the lien “arises solely from any unpaid water, sewer and other sanitary system  charges” and is less than $750 in total.

    “We’re one of the few jurisdictions in the United States of America that thinks an equitable solution to not paying water bills it to take your house,” said State Sen. James Brochin, D-Baltimore County, the measure’s chief sponsor. “It’s predatory and bizarre.”

    Brochin’s bill has three co-sponsors. It’s the second time that lawmakers have sought to amend the tax sale law since Valentine’s story, which was published jointly with The Baltimore Sun, surfaced.

    Valentine was evicted in February 2010 from the west Baltimore home her family had owned for decades after a judge ordered her to pay more than $3,600 in legal fees and other costs—nearly ten times her original debt.

    A former mental health counselor with four children, Valentine conceded that she owed the water bill, and later some taxes on the property. But she argued the fees were excessive and in any case she couldn’t afford them.

    Brochin said that city officials should shut off metered water service when homeowners fail to pay, rather than subject them to the tax sale, through which investors can profit from the financial distress of others.

    “People are losing homes to foreclosure for a lot of other reasons. We don’t need to add to it,” Brochin said.

    A spokesman for Baltimore Mayor Stephanie Rawlings-Blake said the mayor would review the bill to study its impact on the city's ability to collect debts from delinquent property owners. He said the city had implemented several reforms in recent years to protect city residents in such matters. However, the city, in common with other tax collectors in the state, has previously opposed restricting liens that are subject to sale. Officials contend that threats of foreclosure compel some people to pay taxes and other municipal bills and that losing that leverage could aggravate budgetary problems.

    Maryland’s tax sale system has drawn controversy in recent years. Three men have pleaded guilty to criminal charges in a Justice Department bid-rigging investigation, including two longtime Baltimore tax-sale investors who made more than $10 million from fees and other costs collected over a six-year period from the owners of more than 6,000 properties.

    Maryland State Senator Jim Brochin.Fred Schultehttp://www.publicintegrity.org/authors/fred-schultehttp://www.publicintegrity.org/2013/01/18/12051/impact-maryland-bill-would-protect-homeowners-investors-buying-debt

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    Add Bank of America, Coca-Cola, FedEx and a collection of labor unions to the growing list of powerful lobbying forces underwriting the second inauguration of President Barack Obama — long a vocal critic of the influence industry and corporate political power.

    The new inaugural bankrollers, the names of which the Presidential Inaugural Committee released this weekend, have together spent $124.3 million lobbying the federal government since Obama took office, a Center for Public Integrity review of federal disclosures shows.

    Lobbying forces donating to Obama’s inaugural have spent nearly $283 million to influence the federal government since 2009 when including previously disclosed corporations, such as AT&T Inc., Microsoft Corp. and energy giant Southern Co.  — a figure likely to grow as the inauguration committee releases the names of more new contributors.

    (Read: Corporate backers poured $160 million into lobbying since 2009.)

    FedEx has spent more than $64 million on federal lobbying since 2009, while Coca-Cola has spent nearly $25 million and Bank of America more than $12.8 million, federal disclosures show.

    The Forest County Potawatomi Community, a Native American tribe based in Wisconsin that operates casinos, also donated to the inaugural committee and has spent $1.5 million on lobbying during the past four years. Another inaugural donor, financial investment firm Ariel Investments, has spent $200,000.

    Lobbying expenditures by newly disclosed union entities donating to the inaugural committee include:

    • American Federation of Government Employees ($4.74 million in 2009);
    • International Brotherhood of Electrical Workers ($3.5 million;)
    • Laborers International Union of North America ($3.5 million);
    • American Postal Workers Union (2.6 million);
    • United Association ($1.9 million);
    • International Association of Fire Fighters ($1.5 million);
    • United Food and Commercial Workers ($1.5 million), and;
    • the Sheet Metal Workers International Association ($150,000).

    Such unions are organized as nonprofit corporations under the Internal Revenue Service code.

    Obama has banned individual lobbyists from donating to his inaugural celebration, but he’s instituted no such prohibition for the corporations or labor unions that together employ several hundred lobbyists to influence government policy and legislation.

    This policy is a marked departure from the practices of Obama’s 2009 inaugural committee, which banned corporate contributions altogether and limited individual donations to $50,000.

    The inaugural committee has not released how much money any of its donors have actually contributed, and by law, it won’t be compelled to disclose such information to the Federal Election Commission until 90 days after Monday’s inauguration.

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    For the first time in a long time, my former insurance colleagues and I agree on something: it’s time for affordability.

    Health insurers’ big PR and lobbying group, America’s Health Insurance Plans, has launched a slick new campaign, complete with compelling graphics and pithy sound bites, to persuade lawmakers that they need to take immediate action to prevent insurance premiums from going up more than usual.

    But while we agree that lawmakers do indeed need to focus on affordability, we disagree on what they should do. Insurance executives want Congress to get rid of some of the most important consumer protections in the Affordable Care Act, a.k.a. ObamaCare. I believe it’s time to focus on the value—or lack thereof—that private health insurance companies actually add to our health care system.

    Several years ago, a coworker asked our CEO during a staff meeting what kept him up at night. He responded with a single word: disintermediation.

    Merriam-Webster defines disintermediation as “the elimination of an intermediary in a transaction between two parties.” So what my boss was saying was that sooner or later, Americans might reach the conclusion that private insurers are no more essential than travel agents (remember them?), and that by dispatching health insurers to the history books, we could reduce spending on health care by billions if not trillions of dollars.   

    Much of what I was paid to do in my former job was to create and perpetuate the impression that insurers are “part of the solution” and “add value” to the system. I put those words between quotation marks because they were used repeatedly by my CEO and other industry leaders and became our mantras, especially in conversations with policymakers and the media.

    In addition to always working those words in our communications, we tried not to miss an opportunity to point the finger of blame for escalating health care costs at others: greedy doctors and hospital executives; medical device manufacturers, inventors of new whiz-bang diagnostic tools and even patients who demand the latest and most expensive drugs. They and the fact that our population is aging are the real “drivers” of health care costs, insurers insist.

    Okay, they have a point. We are getting older. And the prevailing means of paying for care in this country creates the perfect environment for overtreatment. But to hear insurance company executives tell it, they are blameless.

    That’s certainly the case in the industry’s new “Time for Affordability” campaign, which targets provisions of the health care reform law that have the greatest potential of doing harm to insurers’ bottom lines.

    Here’s the world as AHIP sees it: “The Affordable Care Act (ACA) will help millions of people get coverage for the first time, but the new health insurance tax, costly benefit requirements and age rating restrictions will drive up the cost of coverage for many consumers and employers. When this happens, many younger and healthier Americans could decide not to get coverage, which would further drive up costs for everyone else.”

    If you think insurance firms are only—or even primarily—interested in holding down the cost of coverage for younger and healthier Americans, you are buying the spin I used to crank out.

    Here’s the real reason for AHIP’s campaign: insurers love the part of ObamaCare that requires us to buy coverage from them because it means billions of dollars in new revenue for them. But they don’t want to part with a penny of that money to help expand coverage to more Americans and they don’t want to be prohibited from discriminating against older and less healthy people. And those are some of the things that the Affordable Care Act will do when it’s fully implemented next year, and that means their profit margins and return on equity likely will take a hit.

    In other words, thanks for the billions, but we and our shareholders—and Wall Street financial analysts—can’t tolerate being asked to share in the cost of making affordable care available to the uninsured, aging and sick among us.

    We will not hear in their “Time for Affordability” campaign that insurers have failed miserably at controlling costs, which supposedly is their raison d’être. Over the past ten years, according to the Kaiser Family Foundation, average premiums have increased 97 percent, much more than inflation (28 percent) and wages (33 percent).  Premiums have also increased much more than medical inflation, which according to a recent Standard and Poors study totaled 48 percent between 2000 and 2010.

    Meanwhile, insurance corporations continue to make Wall Street-pleasing profits. UnitedHealthcare announced last week that it made $9.3 billion in profits in 2012.  That’s just one of the 1,300 health plans AHIP says it represents. UnitedHealth used a third of that—$3.1 billion—to repurchase its own stock last year, which had the effect of boosting earnings per share for stockholders.

    Yes, insurers, it is time for affordability. And time for us as a country to take a good look at why we need to keep you around.

    America’s Health Insurance Plans has launched a new online campaign to persuade lawmakers that they need to take immediate action to prevent insurance premiums from going up more than usual. Wendell Potterhttp://www.publicintegrity.org/authors/wendell-potterhttp://www.publicintegrity.org/2013/01/21/12056/opinion-differing-notions-affordability

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    The state of Massachusetts is going to trial this week, fighting accusations that it is systematically failing to protect children in foster care from allegedly unfit foster homes,  physical abuse, medical and educational neglect, questionable psychotropic drug doses and other harm. 

    Children’s Rights, a New York-based children’s national advocacy group, filed suit against Massachusetts Gov. Deval  Patrick and two health and human services officials in April 2010. The trial that opened in federal court in Boston Tuesday could last for weeks.

    Massachusetts has a good reputation as a state concerned with child welfare, Children’s Rights’ executive director Marcia Robinson Lowry said. But after two years of research, her group was surprised to conclude that the state’s child-welfare system is “one of the most dangerous in the country on a number of significant measures.” 

    The Children’s Rights’ suit is a class-action lawsuit with six young plaintiffs whose alleged neglect is specifically described, along with findings based on data measuring various aspects of children’s care. Massachusetts tried, unsuccessfully to get a court to block Children’s Rights’ pursuit of a class-action lawsuit representing all the state’s foster children, who currently number about 7,500.

    Massachusetts is the first state to decide to go to full trial – instead of settling— in response to a legal challenge by Children’s Rights alleging that foster children’s constitutional rights are being violated. Children’s Rights has sued 15 other states’ foster-care and welfare systems for alleged neglect of children.  

    “The accusation of deliberate indifference just does not fit,” said Angelo McLair, commissioner of the Massachusetts Department of Children and Families, who is also named as a defendant in the suit. He told the Center for Public Integrity that the trial— expected to last weeks— is an opportunity for the state to air its side of the story, including a description of changes it has undertaken to improve the foster-care system.  

    Court documents show that McLair and the defendants, including Gov. Patrick, have argued that Children’s Rights can’t establish a link between the alleged harm done to the six individual plaintiffs and the need for “systemic”  changes that the class-action lawsuit seeks —including federal court-ordered reforms and oversight. In a background document given to the Center, the state says, “We expect the full evidence at trial to show that the Department (of Children and Families) meets its obligations under the law to protect children from abuse and neglect.” The state has a more “comprehensive process of screening in cases for investigation” of alleged abuses than 44 other states, the document also says.

    Unlike other states that the Children’s Right’s group has sued,  Lowry said, Massachusetts “has expressed no interest in settling this case.”

    She said that in Massachusetts, “there has been, from time to time, lip service to fix these problems.”

    But while some changes have been instituted, Lowry said, “they have been improvements around the edges – with plans.” And some of the state’s own witnesses so far have said it’s too soon to tell if they’ll work, Lowry said.

    “The state is actually misspending money,” Lowry said, because of allegedly poor practices that end up “compounding” children’s problems and costing taxpayers more as children languish in state care for years, requiring ever more specialized care, or cycle in and out of the system.

    In its lawsuit, Children’s Rights describes harrowing allegations of suffering by the plaintiffs, including a boy named Connor B., who was removed from the care of his mother when he was six-years-old because of alleged neglect and endangerment in her home.

    Connor was placed in a foster home with another older boy officials knew could pose a threat, the lawsuit says, but there were insufficient safety plans in place inside that home and the boy began to allegedly sexually abuse Connor in his room.  Connor was moved at least five times during his first year in foster care, the suit says.

    Because of abuses suffered following his abuse in foster care, according to the lawsuit, Connor was hospitalized for more than four months and diagnosed with post-traumatic stress disorder. A specialist made specific recommendations for where Connor should be placed. But child-welfare officials allegedly disregarded those recommendations and Connor, as a result, failed to get appropriate therapy and access to schooling as he was shuttled about from home to home,  the suit says. 

    McLain said the state’s attorney didn’t want him to get into a discussion of legal stategy, but that once in court, the state will address allegations of neglect and the system’s transformation in recent years.

    The lawsuit says Massachusetts moves children around among foster homes with “damaging frequency.” A federal audit ranked the state eighth worst among 51 jurisdictions, including states and the District of Columbia, reporting data on “placement stability.” This is a measuresment of how well a jurisidiction does at keeping children in stable foster homes rather than shuffling them around. The suit also notes that a federal audit ranked Massachusetts at 13th worst among 47 jurisdictions reporting data related to “timeliness of adoptions” of children in foster care.

    In a background document, the state’s Department of Children and Families says that its decision to contest the Children’s Rights’ lawsuit is “further evidence that we are confident in the work that we are doing on behalf of children in the Commonwealth.”

    In the last four years, the document says, the state has increased “placement stability” of foster children from 73 to 79 percent, an improvement in the measurement of how well a jurisdiction is doing in avoiding transfers of children from home to home.  Officials attribute to better rates of placement of children with relatives.

    McLair, the commissioner of children and families, said that a review in 2009 led officials to acknowledge that they had to strive to improve the rate at which they were placing children with kin rather than non-relative foster parents. The rate of placement with kin increased from 72 percent in 2008 to 80 percent today, McLair said.

    He also said that Massachusetts has improved its child-to-social worker caseload in recent years, from 18 to one to a current level of 16 to one.  And, McLair added, the state recently boosted payments to foster parents, who were being underpaid.

    The state doesn’t dispute examples of some problems that need to be addressed, McLair said. But he said officials disagree that the state needs federal court oversight to keep making improvements.

    Massachusetts Gov. Deval Patrick, center, greets legislators and guests as he enters the House Chamber at the Statehouse in Boston.Susan Ferrisshttp://www.publicintegrity.org/authors/susan-ferrisshttp://www.publicintegrity.org/2013/01/23/12062/class-action-suit-challenges-massachusetts-foster-care-system

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    Congress’ fiscal cliff fiasco, a flurry of lame duck legislation and election-season politics drove some of the nation’s most powerful lobbying forces to double down on their governmental influence efforts late last year, newly filed reports show.

    Such an uptick foreshadows what could be ever-more-aggressive lobbying on federal finances, taxation, energy and social issues like immigration and gun ownership as President Barack Obama enumerated in his inaugural address Monday.

    The trend may end a prolonged lobbying spending slowdown largely prompted by Capitol Hill gridlock and a dearth of meaningful legislation receiving consideration during much of 2011 and 2012.

    In all, about half of the year’s top 100 lobbying organizations spent more on lobbying in the fourth quarter of last year than in the third quarter. About half also showed an overall increase in spending for 2012, a Center for Public Integrity analysis of congressional disclosure reports and Center for Responsive Politics data indicates.

    The U.S. Chamber of Commerce’s year-over-year lobbying spending skyrocketed more than 88 percent, from $66.4 million to more than $125 million, to easily lead all other organizations.

    Prominent business and financial lobbies, meanwhile, rank among organizations that spent significantly more during the fourth quarter of 2012 than they did during the third quarter, including the National Association of Realtors ($15.4 million from $9.8 million), the Business Roundtable ($4.8 million from $4 million), JPMorgan Chase and Co. ($3.2 million from $1.4 million) the American Bankers Association ($2.1 million from $1.8 million) and Visa ($1.7 million from $1.1 million), records show.

    For the Business Roundtable, the jump represents an “intensified effort” to influence fiscal cliff negotiations, permanent normalized trade relations with Russia and tax reform, said Tita Freeman, an organization spokesperson.

    But percentage-wise, the greatest lobbying spending growth late in 2012 comes from companies representing a variety of industries aghast at the package of automatic tax increases and spending cuts that had been slated for implementation had Congress not struck a last-minute deal to avoid them.

    They include information technology behemoth Oracle Corp. ($1.8 million during the 4th quarter from $640,000 during the 3rd quarter), energy giant Southern Co. ($5.1 million from $2.5 million), Duke Energy ($2.3 million from $1.3 million) and Dow Chemical ($2.6 million from $1.6 million), according to congressional records.

    Defense contractors Northrop Grumman, Lockheed Martin, Raytheon Co. and General Dynamics also reported moderate increases from the third quarter to the fourth. These and other companies that rely on government contracts stood to potentially lose billions of dollars had automatic federal spending cuts been put in place at the end of 2012.

    While not yet among the nation’s biggest-spending lobbying forces, the National Rifle Association and the affiliated NRA Institute for Legislative Action together fueled their 2012 lobbying efforts with about $3 million – more money than during any other single year.

    The NRA’s lobbying comes as the association finds itself in the midst of a nationwide conversation, and looming political battle, over gun ownership restrictions following the December massacre of 26 people at a Connecticut elementary school.

    The gun rights lobby also faces a host of new and moneyed lobbying opponents this year, most notably organizations led by former Rep. Gabrielle Giffords (D-Ariz.) and New York City Mayor Michael Bloomberg (I). Pro-gun advocates have historically and exponentially outspent gun control interests.

    Facebook, for its part, posted its priciest quarter ever — $1.4 million in the fourth quarter — and passed the seven-figure threshold for the first time during a three-month period. The social media company, which didn’t invest a cent in federally reportable lobbying until 2009, spent nearly $4 million in 2012, or about three times the $1.35 million it spent in 2011, and shows no indication its slowing its rapid expansion into the political sphere.

    Generally, federal legislation, congressional activities and regulatory action prompt most lobbying spending, although recent dollar-figure spikes are caused, in part, by national elections.

    Take the U.S. Chamber of Commerce and the National Association of Realtors.

    The two business organizations are among a small group of lobbies that opt to disclose their state- and grassroots-level lobbying (and sometimes political organizing) costs alongside their federally focused efforts.

    The pending disclosures do not, however, appear to include the tens of millions of dollars collectively spent on directly attacking or supporting political candidates, primarily through television and radio advertisements, during the 2012 election.

    “Our 2012 lobbying figures reflect that it was an election year, where the Chamber engaged in an unprecedented voter education campaign to educate the public about candidates' positions on issues critical to free enterprise, such as health care, regulation, energy production and taxes,” Chamber spokeswoman Blair Latoff Holmes said.

    The Realtors also engaged heavy political field organizing efforts, said Jamie Gregory, deputy chief lobbyist for the association, which reported $41.4 million in spending during 2012 in its federal lobbying reports.

    That figure trailed only the Chamber and put it ahead of General Electric, the National Cable & Telecommunications Association, American Hospital Association, the Pharmaceutical Research & Manufacturers of America, Google, Northrop Grumman, AT&T and the American Medical Association among the nation’s top 10 lobbying spenders last year.

    “Accordingly, we expect a drop in spending during 2013, and in 2014, expect it to go back up,” Gregory said.

    Several corporations known to have donated money to Obama’s inauguration committee are also among top lobbying forces of 2012: AT&T spent $17.4 million on federally reportable lobbying last year, followed by Southern Co. ($15.6 million), FedEx Corp. ($11.9 million), Microsoft ($8.1 million), and Coca-Cola ($4.8 million), disclosures show.


    About half of the year’s top 100 lobbying organizations showed an overall increase in spending for 2012.Dave Levinthalhttp://www.publicintegrity.org/authors/dave-levinthalhttp://www.publicintegrity.org/2013/01/23/12067/fiscal-cliff-elections-boost-spending-lobbying

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    The 'Alice in Wonderland' saga of Notre Dame football star Manti Te'o and the girlfriend who turned out to be a hoax has ignited a new round of criticism over the school's handling of a sexual assault allegation against a different football player more than two years ago.

    Notre Dame hired a private investigative firm in an attempt to unravel fact from fiction in regard to Te'o and the fictitious girlfriend, Lennay Kekua, who was said to have died last fall. Notre Dame athletic directior Jack Swarbrick later held an emotional press conference to defend Te'o and cast him as the victim of a cruel ruse. 

    That was quite a contrast, critics charge, to the treatment afforded freshman Lizzy Seeberg, who reported to campus police in August 2010 that she'd been sexually assaulted by a football player. Police waited two weeks before interviewing the player. By then, Seeberg had committed suicide. Notre Dame said a "thorough and judicious" investigation was conducted. The player was later found "not responsible" in a closed-door campus judiciary hearing. 

    As our Kristen Lombardi reported last month, the circumstances surrounding the Seeberg case are actually far from unusual. Colleges have long struggled mightily in their attempts to deal with charges of campus sexual assault.

    Read Lombardi's story here.

    The Center for Public Integrityhttp://www.publicintegrity.org/authors/center-public-integrityhttp://www.publicintegrity.org/2013/01/23/12072/teo-saga-brings-renewed-criticism-notre-dame

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    A test pilot preparing for takeoff in what is billed as the world’s most advanced military aircraft made an unsettling discovery last week: A cockpit signal warned him of a fuel problem and closer inspection revealed a hose that carries jet fuel had come loose in the engine compartment.

    The result was a scramble to investigate the incident and the grounding over the weekend of twenty-five F-35  Joint Strike Fighter being tested at air bases in Florida and Arizona, as well as Lockheed Martin’s production factory in Fort Worth, Texas. The decoupled hose was only the latest of many glitches in the costliest weapons program in U.S. history.

    Just days earlier, the Pentagon’s Operational Test and Evaluation office's annual report to Congress had identified the “fueldraulic” lines at the heart of the incident as a potential fire hazard.

    The report said that a 2008 decision to remove certain fire protective systems from the plane to save weight, including those associated with the fueldraulic lines, resulted in “a 25 percent increase in aircraft vulnerability.” It warned that removal of these systems meant the F-35 did not meet a requirement that it be less vulnerable to damage from fires than older, similar military aircraft.

    The risks associated with the fueldraulic lines were just one of a number of problems the OT&E report detailed in the Marine, Air Force and Navy versions of the plane, all currently undergoing testing. They include ongoing problems with the plane’s millions of lines of computer code, a particular vulnerability to lightning, and continuing defects in its sophisticated helmet, with its see-through data and symbol displays.

    According to the test report, the F-35’s mission is to be ready to attack targets day or night “in all weather, and in highly defended areas of joint operations.” But because of concerns about the fuel tank’s vulnerability to lightning, the report said, current flight operations by the aircraft are not permitted within 25 miles of lightning-producing storms.

    The plane’s use of “fueldraulic” line, installed only in the Marine Corps’ version of the F-35 aircraft, is just one of its many technically-challenging features. Its aim is to save weight by using some of its fuel as the hydraulic fluid that helps swivel the plane’s jet exhaust system during short take-offs and vertical landings. Weight is a major factor affecting the speed and agility of the 6 ½-ton airplane.

    The report revealed that a prototype system for protecting pilots from chemical or biological weapons – things they could conceivably encounter in places like Syria – was developed but judged “too complex for field use.”

    Following the incident at Eglin Air Force base in Florida, the Marine Corps launched a review of what caused the hose to decouple, which officials said could be finished quickly. The two other variants of the F-35, one designed for the Air Force and the other the Navy, were not affected by the glitch because they don’t have fueldraulic lines. Both are designed only for horizontal, not vertical takeoffs and landings.

     “There were no injuries to the pilot or ground crew,” said Commander Kyra Hawn of the F-35 program office in an e-mailed statement. “The jet was then safely towed to a maintenance hangar and secured.” Pratt & Whitney spokesman Matthew C. Bates said a team of Pratt & Whitney and Rolls Royce engineers were working with Lockheed Martin and the Pentagon’s F-35 Joint Program Office to fix the problem as quickly as possible.

    But the latest problems come after nearly seventeen years of development and seven years of production, while testing remains incomplete. The aircraft is years behind schedule and more than half a billion dollars over budget.

    Pierre Sprey, a critic of the F-35 who played a major role in the design of the F-16 fighter and A-10 ground attack jets, said the detached line could have posed a fire hazard in flight. “They’re damn lucky,” he said.

    As the Center reported in June the F-35’s helmet, a critical piece of technology for the futuristic aircraft, has long been a headache for developers. The plane is more or less designed around the helmet, which is supposed to let the pilot look through data projected the visor while maneuvering.

    Jitter caused by aircraft vibrations is still making the helmet see-through display hard to read, the latest report affirmed. Night vision isn’t as good as required by the specifications.

    The report also disclosed that flight testing has uncovered a problem with what is called “green glow,” where light from the cockpit displays “leak” into the helmet display, making it harder to see through the visor in low-light conditions.

    Sprey said he was particularly troubled by the report’s mention of scorching in the the trailing edge of the plane’s horizontal tail fins by the jet’s  engines. “It’s not hard to figure out whether the engine exhaust is going to touch and burn the tail,” he said.

    The report also disclosed that some of the planes have suffered cracks, experienced excess vibrations at high speeds, and have recurring problems with their complex software.

    In response to rising costs and other problems, the Department of Defense put the F-35B, the version used by the Marine Corps, on “probation” in early 2011.

    A year later, then-Secretary of Defense Leon Panetta lifted that probation, pending resolution of outstanding issues with the builders, saying the aircraft was performing with “the kind of performance and maturity” of the other two versions -- the Air Force plane designed for conventional landings and a Navy version adapted to landing on aircraft carriers.

    “I want you to know that as secretary of defense, my department is committed to the development of the F-35,” Panetta told military personnel at Patuxent Naval Air Station in Maryland in January 2012.

    The F-35 is known as the Joint Strike Fighter, because it was originally conceived as a cost-saving new fighter that could be shared by the Air Force, Navy and Marines. But during the plane’s lengthy and complex development, the three designs have diverged.

    Many experts have questioned the Pentagon’s decision to design, test and build the complex aircraft at the same time, rather design it first and test it later. Officials argued that this dual track approach could save time and money, and that most major design problems could caught by advanced computer modeling and simulation.

    But Maj. Gen. Christopher Bogdan, now the F-35’s executive program manager, last fall called the decision to begin to manufacture the plane while it was still being designed “the greatest of all sins in the Joint Strike Fighter Program.”

    The X-35B — the Marine Corps version of the new Joint Strike Fighter F-35.Douglas Birchhttp://www.publicintegrity.org/authors/douglas-birchhttp://www.publicintegrity.org/2013/01/24/12073/close-call-world-s-most-advanced-warplane

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    Rank: 2

    Clients’ expenditures: $163 million*

    Year founded: 2001




    Crossroads Media was founded by Michael Dubke, a longtime political player who is also president of the nonprofit group Americans for Job Security.

    The firm’s president is Patti Heck, a media buyer for more than 20 years. Heck’s career spans all 50 states and every level of elected government. Some of her most notable clients include the Republican Governors Association and the Republican National Committee.

    Crossroads Media lies at the center of a web of powerful conservative media firms and political committees.

    The company has strong ties to Republican strategist Karl Rove, who is a “senior adviser” to the firm, according to the public relations trade publication O’Dwyers. It counts the super PAC American Crossroads and the nonprofit Crossroads GPS, both co-founded by Rove, among its top clients.

    And it shares an office suite in Alexandria, Va. with three other firms that have connections to the pro-Mitt Romney super PAC Restore Our Future and Romney’s 2012 presidential campaign.

    Black Rock Media Group is one of those firms. It was co-founded by Republican strategist Carl Forti, the director of both American Crossroads and Crossroads GPS, and Dubke. Forti is also the founder of Restore Our Future.

    TargetPoint Consulting and WPP Strategies are likewise located at the same address.

    TargetPoint Consulting advised both Restore Our Future and Romney’s campaign. WPP Strategies is headed by Katie Packer Gage, the deputy manager of Romney’s campaign, who is married to the head of TargetPoint Consulting, Alexander Gage.

    Last updated: Jan. 18, 2013

    * Total consists of independent expenditures made to the firm in the 2012 election cycle as reported to the Federal Election Commission.

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    Rank: 1

    Clients’ expenditures: $204 million*

    Year founded: 1991


    • Bruce Mentzer (founder)



    Bruce Mentzer, 49, began his career at the Goodman Agency, a Baltimore public relations firm that specialized in creating TV ads for political campaigns. He opened Mentzer Media in 1991.

    Mentzer Media is a media buying firm that works primarily with Republicans. Its two most notable customers during the 2012 election were the pro-Mitt Romney super PAC Restore Our Future and the conservative super PAC American Crossroads, which was co-founded by Republican strategists Karl Rove and Ed Gillespie.

    The firm works closely with McCarthy Hennings Media Inc. Mentzer was the media buyer for the Swift Boat Veterans for Truth ad campaign that helped sink Democrat John Kerry’s 2004 presidential bid. The agency was paid more than $18 million for that work.

    It also placed a $1.6 million, three-state ad buy in 2010 for “Stop Too Big to Fail,” a mysterious group opposing finance industry regulation.

    Last updated: Jan. 18, 2013

    * Total consists of independent expenditures made to the firm in the 2012 election cycle as reported to the Federal Election Commission.

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    Rank: 5

    Clients’ expenditures: $27 million*

    Principals: Unknown

    Year founded: 2012

    Website: None



    American Media and Advocacy Group was a favorite media buyer for several top conservative Citizens United-related groups active in the 2012 election. 

    Through Dec. 6, American Media was paid more than $27 million to buy advertising in several battleground states. The lion’s share of those receipts — nearly $18 million — came from the American Action Network, the conservative nonprofit run by Norm Coleman, the former U.S. senator from Minnesota, and its super PAC arm, the Congressional Leadership Fund.

    The firm also purchased nearly $7 million of media time on behalf of the Ending Spending Action Fund, the super PAC run by TD Ameritrade founder Joe Ricketts, whose family owns the Chicago Cubs.

    Despite its high-profile clientele, American Media toiled in relative obscurity during the 2012 election.  The firm has no website and little information about the group has been published. Federal Election Commission reports show it shares office space and administrative staff with a network of political consulting groups in an Alexandria, Va.

    Among them is the well-known bipartisan political consulting group Purple Strategies, run by longtime Republican strategist Alex Castellanos. Representatives at Purple Strategies failed to reply to the Center’s repeated inquiries regarding its affiliation with American Media.

    Last Updated: Jan. 18, 2013

    * Total consists of independent expenditures made to the firm in the 2012 election cycle as reported to the Federal Election Commission. 


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    Rank: 4

    Clients’ expenditures: $59 million*

    Year founded: 2002

    Website: munkato.com


    • Carole Mundy (partner): Oversees the firm’s media planning and placement for multistate and national programs from its Roslyn, N.Y. office.  
    • Janet Katowitz (partner): A former operative with the Michigan Senate Democratic Caucus, Katowitz manages the firm’s day-to-day operations at its Washington, D.C., office.



    Founded in 2002, Mundy Katowitz Media (MKM) is a media buying firm that serves Democratic-aligned candidates and indepdent political spending groups. Its top client during the 2012 election was Priorities USA Action, the super PAC supporting President Barack Obama’s re-election.

    MKM — run by veteran Democratic operative Janet Katowitz — billed $57 million for advertising time on behalf of Priorities USA Action during the 2012 election cycle. The firm’s other clients included LCV Victory Fund, the super PAC arm of the pro-environment League of Conservation Voters, and FSA PAC, another pro-environment group that placed ads favoring Democrats.

    The firm’s other named partner is Carole Mundy, who runs the firm’s New York office.

    Media buyers like MKM traditionally collect a commission of up to 15 percent, regardless of their client’s success rate on Election Day.  

    Katowitz told a group of American University students in 2004 that media buying is “shrouded in mystery” and the reason? "it’s a very lucrative industry.”

    Last Updated: Jan. 18, 2013

    * Total consists of independent expenditures made to the firm in the 2012 election cycle as reported to the Federal Election Commission. 

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    Rank: 3

    Clients’ expenditures: $81 million*

    Website: None


    Raeylnn Olson (president)



    Waterfront Strategies is a media buying firm that serves primarily Democratic-aligned super PACs and nonprofits.  The firm was the preferred vendor for Majority PAC and House Majority PAC — the super PACs aimed at securing Democratic seats in the U.S. Senate and U.S. House of Representatives.

    Waterfront billed more than $81 million for political ad buys for Citizens United-related groups in the 2012 election, yet very little information about the firm is publicly available.

    The same cannot be said for GMMB, a well-known political consulting firm which shares a Georgetown address with Waterfront and was the chosen advertising agency for President Barack Obama’s 2008 and 2012 campaigns.

    Waterfront is an “internal branch” of GMMB, according to a Huffington Post  report from June. The group was incorporated in Delaware and lists its president as Raelynn Olson, a managing partner at GMMB.

    Through Dec. 5, Waterfront purchased nearly $35 million in advertising time on behalf of Majority PAC, and $27 million for House Majority PAC.  Another top client of the 2012 election cycle was the League of Conservation Voters, Inc., a nonprofit that supports mostly pro-environment Democrats.

    Last Updated: Jan. 18, 2013

    * Total consists of independent expenditures made to the firm in the 2012 election cycle as reported to the Federal Election Commission. 

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    Last fall, a cadre of wealthy business executives and conservative groups tried to sell California voters on new campaign finance reforms.

    Couched in lofty rhetoric about the importance of cutting off money from special interests to politicians and other regulations favored by reformers, their proposal sought to ban the practice of using payroll deductions for political expenditures — a popular method of union fundraising.

    Once alerted to the true nature of Proposition 32, the unions and political left rose up against it.

    An innocuously named nonprofit, the Iowa-based American Future Fund, proved to be one of the biggest backers of the initiative, sinking more than $4 million into the ballot measure that voters ultimately rejected.

    As a “social welfare” organization, the American Future Fund is not required to publicly disclose its donors. But to maintain its tax-exempt status under Sec. 501(c)(4) of the U.S. tax code, influencing elections cannot be its primary purpose.

    The American Future Fund’s investment in California was part of a nationwide, political advertising spree in 2012 that exceeded $29 million, according to a Center for Public Integrity analysis of state and federal records.

    That amount included more than $19 million on efforts designed to oust President Barack Obama, as well as millions more to oppose Democratic candidates for Congress and even two state attorneys general. Now the group is funding ads opposing Obama’s nomination of former Republican Sen. Chuck Hagel of Nebraska for defense secretary.

    Since the U.S. Supreme Court’s controversial Citizens United decision in 2010, nonprofits such as the American Future Fund have played a more prominent role in electoral contests — all while giving their supporters the ability to keep their identities hidden. During the 2010 midterm elections, politically active nonprofits outspent super PACs, which exist to fund political advertisements, by a 3-to-2 margin.

    The American Future Fund ranked third among “social welfare” nonprofits in spending in the 2012 federal election, according to the Center for Responsive Politics, trailing only the Karl Rove-affiliated Crossroads GPS and Americans for Prosperity, which is backed by conservative billionaire brothers Charles and David Koch.

    There are also Democratic-aligned nonprofits, but their spending was well below that of their conservative counterparts. The top left-leaning nonprofit was the League of Conservation Voters, which reported spending about $11 million in the 2012 election opposing or supporting candidates.

    The American Future Fund’s spending “raises some serious questions” and “evades any form of meaningful disclosure,” said Adam Rappaport, senior counsel with watchdog group Citizens for Responsibility and Ethics in Washington (CREW).

    Numerous officials with the American Future Fund did not respond to requests for comment for this story.

    Advocating for ‘free-market ideas’

    The American Future Fund’s mission is to “educate and advocate for conservative and free-market ideas,” according to its annual filing with the Internal Revenue Service.

    Despite asserting that it isn’t primarily focused on elections, the nonprofit’s DNA is decidedly political.

    Conservative political operative Nick Ryan, a longtime adviser to former GOP Rep. Jim Nussle of Iowa, founded it in 2007. Over the years, the group has paid Ryan’s firm, Concordia Enterprises, hundreds of thousands of dollars annually for consulting services.

    In 2010, the New York Timesreported that Iowa businessman Bruce Rastetter provided an unspecified amount of “seed money” for the organization. Ryan once represented four of Rastetter’s companies as a lobbyist, including Hawkeye Energy Holdings, one of the country’s largest ethanol producers.

    The nonprofit’s first president was Nicole Schlinger, the former finance director of Iowa’s Republican Party. Its current president is veteran Republican state Sen. Sandra Greiner, who served for 14 years as the Iowa chairwoman of the pro-business American Legislative Exchange Council.

    Ryan and Greiner did not respond to requests for comment.

    In 2008, when the American Future Fund was seeking — and ultimately garnered — tax-exempt status from the IRS, it pledged to abstain from electoral politics, saying it would spend 70 percent of its time doing work to “educate the public on policy issues” and 30 percent engaging in efforts to “influence legislation through grassroots advocacy.”

    When asked on its application if the group had any plans to spend money to “influence the selection, nomination, election or appointment” of anyone seeking public office, it answered “no.” It also vowed to stay out of the presidential race.

    When the IRS subsequently inquired why the group’s advertisements “appear to be more partisan than nonpartisan,” the group’s attorney, Karen Blackistone, wrote that the efforts were “strictly issued-based and nonpartisan.”

    The group takes a position on issues and encourages the public to contact their representative, she wrote in a 2008 response to the IRS.

    “AFF’s advertisements have never commented on a candidate’s character, qualifications or fitness for office,” she stated.

    Big money tied to post office box

    The American Future Fund has raised more than $60 million, with spikes in contributions coming in election years.

    Much of that money has come from another conservative “social welfare” nonprofit that doesn’t disclose its donors by name — the Arizona-based Center to Protect Patient Rights.

    The nonprofit has no website and lists its address as a post office box in Phoenix. It was launched in 2009 by Republican operative Sean Noble, who has extensive ties to the vast political network underwritten by the Koch brothers.

    Noble, a former chief of staff for former Rep. John Shadegg, R-Ariz., did not respond to requests for comment for this story.

    For three years running, Noble’s organization has reported making substantial grants to the American Future Fund for “general support,” according to IRS filings. The nonprofit contributed more than $14 million to the American Future Fund between 2009 and 2011, or 51 percent of funds the group raised over the three-year period.

    The Center to Protect Patient Rights has also given millions of dollars to a network of conservative groups, including the Koch-backed nonprofit Americans for Prosperity, as was first reported by the Center for Responsive Politics.

    In addition to Noble, there is another Koch connection.

    In 2008, Trent Sebits, the former manager of public and government affairs for the Kochs’ Wichita-based refining giant, Koch Industries, registered with the state of Kansas to lobby on behalf of the American Future Fund and Americans for Prosperity. Sebits did not respond to a request for comment.

    The American Justice Partnership, another “social welfare” nonprofit, gave $50,000 to the American Future Fund in 2011 and $2.4 million in 2010, according to IRS filings. The group supports free enterprise and is often at odds with trial lawyers.

    Dan Pero, its president, said in an emailed statement that the organization supported the American Future Fund to help “promote free enterprise and improve the fairness and predictability of the legal environment.”

    Like super PACs, “social welfare” nonprofits are allowed to accept unlimited donations from individuals, corporations, unions and other organizations. The only funders whose names they are required to publicly disclose are those that make contributions earmarked for political purposes.

    That’s as it should be, according to attorney Dan Backer, who is not affiliated the American Future Fund but does work with other conservative groups.

    “A nonprofit makes its decisions by a board or other management structure, which is distinct from its donors,” Backer said.

    Increasingly political

    In 2010, the American Future Fund became far more politically active, reporting $8.6 million in political expenditures as well as millions more for “media services,” “telecommunications” and “mail service/production.” It told the Federal Election Commission that it spent $9.1 million on political advertisements.

    Marcus Owens, former chief of the IRS’s nonprofits division, said it is “difficult to conjure up a situation where a particular expenditure would be reportable to the FEC but would not constitute political campaign intervention under tax law.”

    Nevertheless, Owens said the organization could make a “straight-faced argument” that its orientation had simply changed over time to become more overtly political.

    Of the $25 million that the American Future Fund reported spending to the FEC last year, more than 90 percent fueled ads that urged voters to support or reject candidates.

    The group also sought the FEC’s advice on whether mentioning the White House or “the administration” in negative ads ahead of Election Day would be seen as referring to a “clearly identified candidate for federal office.”

    Such a designation would have required the group to disclose information about its donors. (The commission deadlocked, 3-3, in a vote along party lines.)

    In addition to the presidential race, the American Future Fund spent money in 20 congressional elections in 2012, including California’s 26th Congressional District, where it spent $500,000 attacking Democrat Julia Brownley, who, as a state legislator, had authored legislation to bolster disclosure for political advertisements.

    She won anyway, but told the Center for Public Integrity that she is “deeply concerned” about the activities of non-disclosing groups in the wake of Citizens United and hopes to “take immediate action” to strengthen federal disclosure laws.

    The American Future Fund also spent more than $542,000 to aid West Virginia Republican Patrick Morrisey in his successful quest to win the race for attorney general, records indicate, and more than $620,000 in a failed effort to sink Missouri Attorney General Chris Koster, a Democrat.

    Complaints about the American Future Fund’s political activities have followed it since its creation.

    In 2008, the Democratic Party in Minnesota contended that the group needed to register as a political committee after paying for ads that praised then-U.S. Sen. Norm Coleman, R-Minn. The FEC disagreed.

    Two years later, in October 2010, consumer group Public Citizen and two other organizations alleged that the American Future Fund’s “huge expenditures” to aid candidates in the midterm election should have triggered requirements that the group register as a political committee and disclose its donors. That complaint is still being considered by the FEC, which often takes years to fully resolve such matters.

    CREW, the watchdog organization, filed a complaint against the American Future Fund with the IRS in February 2011 that challenged whether its primary purpose was something other than influencing elections. The group has dismissed the complaint as “baseless” and contends that CREW “only targets government officials and organizations who have a differing or conservative point of view.”

    Proposition 32

    California’s campaign finance rules require major donors to groups that pay for political advertisements to be named in actual ads.

    Thus, when a political committee called the California Future Fund for Free Markets aired ads praising Proposition 32, each advertisement included the disclaimer “with major funding by the American Future Fund.”

    One ad criticized lawmakers for making “deals cut in shadows and back rooms” as dramatic music played in the background. Yet the donors to the American Future Fund itself largely remain in the shadows.

    When a political committee aired ads praising Proposition 32 in the 2012 elections, each advertisement included the disclaimer “with major funding by the American Future Fund.” Michael Beckelhttp://www.publicintegrity.org/authors/michael-beckelhttp://www.publicintegrity.org/2013/01/28/12066/nonprofit-spends-big-politics-despite-irs-limitation

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    In my book,  Deadly Spin, I described the PR playbook health insurers, tobacco companies and other special interests use to influence public policy, often by deceptive means.

    One tried-and-true tactic is to recruit third parties to help deliver your talking points — hopefully, individuals and organizations that are held in higher regard by the public than your own company or industry.

    This is a staple of the insurance industry’s playbook —my former colleagues know that they’re not especially popular.  In fact, internal polls I was privy to as an industry executive showed consistently that health insurers were beloved by the public just slightly more than tobacco companies.

    True to form, America’s Health Insurance Plans (AHIP), the industry’s big PR and lobbying group, has rolled out a slick campaign aimed at getting Congress to gut some of ObamaCare’s most important consumer protections.

     “Time for Affordability” is the name of AHIP’s campaign. Since the official name of ObamaCare is the Patient Protection and Affordable Care Act, the idea here is to persuade folks that the word “affordable” does not really apply to the law and that the insurers, long-time champions of affordability that they are, have solutions to fix it.  

    Among the patient protections insurers have set their sights on are the ones that prohibit them from selling what many consumer advocates call “junk insurance” and that prohibit them from charging older customers more than three times as much as they charge their younger ones. Insurers’ preference would be for Congress to just get rid of that prohibition entirely. The consolation prize would be for Congress to let them charge older folks 500% more instead of just 300% more. Charging the elderly exorbitant rates is part of a decades-long strategy to make coverage unaffordable for older folks.

     A perfect third-party ally in this fight would be an organization that purports to represent young people. Lo and behold, one has surfaced. It is SHOUT America, founded by Clayton McWhorter, the former CEO of the Hospital Corporation of America (HCA), the Nashville-based for-profit hospital chain, and headed by Landon Gibbs, a former aide to former President George W. Bush. As several consumer advocates have brought to my attention, SHOUT America is taking out ads using AHIP’s talking points in an online publication well-read inside the D.C. Beltway.

    According to SHOUT America’s 2010 federal tax return, the most recent available, its gross income, including membership fees, was $43,915.00. All but $8,640.00 of that went to pay the salary of what appears to be the group’s only full-time employee. SHOUT America’s address in the tony Nashville suburb of Brentwood is the same as that of a venture capital firm, Clayton Associates, the chairman emeritus of which is Clayton McWhorter.

    The group must have had a recent infusion of cash to be able to take out ads in POLITICO PULSE, which has become a daily must-read on health care policy for Washington policymakers and opinion leaders.

    Here’s text from one of the recent ads: “A message from SHOUT America: Many younger, healthier individuals could be surprised to see the cost of their health insurance increase dramatically, potentially skyrocketing 40 percent or more when new provisions from the Affordable Care Act go into effect in 2014. What's behind this? New federal rating restrictions, including a 3 to 1 limit on the use of age, broader benefits, the health insurance tax, as well as other changes will cause the insurance premiums to increase disproportionately for younger, healthier Americans.”

    Now compare that to the first paragraph on AHIP’s “Time for Affordability” website: “The Affordable Care Act (ACA) will help millions of people get coverage for the first time, but the new health insurance tax, costly benefit requirements and age rating restrictions will drive up the cost of coverage for many consumers and employers. When this happens, many younger and healthier Americans could decide not to get coverage, which would further drive up costs for everyone else.”

    What AHIP and SHOUT America don’t say is that most young people will actually be able to get affordable coverage for the first time when ObamaCare is fully implemented on Jan. 1, 2014, either through the expansion of Medicaid or the subsidies that will be available for people making up to 400% of the federal poverty level ($43,560 for an individual and $89,400 for a family of four in 2011, according to the Kaiser Family Foundation). This will enable millions of people, young and old alike, to leave the ranks of the uninsured.

    Yes, a few relatively well-paid young people will see their premiums go up, but many of their parents, who helped put them through school to get decent-paying jobs, will see them go down.

    The status quo that AHIP and friends are trying to preserve works best for a few people, especially insurance company executives whose companies make huge profits by selling junk insurance and gouging older people. It does not work at all for most of the rest of us, and certainly not for most of those young people that SHOUT America claims to represent.

    Wendell Potterhttp://www.publicintegrity.org/authors/wendell-potterhttp://www.publicintegrity.org/2013/01/28/12080/opinion-distorted-spin-health-insurers-and-their-friendly-front-groups

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    The Center for Public Integrity's Consider the Source project today launches Primary Source, a daily diary of developments in the post-Citizens United world of money in politics.

    Primary Source will augment Consider the Source's investigative reporting and feature original reporting from Center staff. The feature will include regular examinations and analyses of primary source documents pertaining to political contributions, spending, lobbying and other forms of influence. 

    Look for several new Primary Source dispatches later today. In the meantime, bookmark Primary Source here, subscribe to its RSS feed here, follow daily updates on Twitter at @PublicI and "like" us on Facebook.

    Also be sure to sent your tips, hints and suggestions to tips@publicintegrity.org.


    United States CapitolDave Levinthalhttp://www.publicintegrity.org/authors/dave-levinthalhttp://www.publicintegrity.org/2013/01/28/12084/new-feature-tracks-political-influence

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    Secretary of State Hillary Clinton's political future may not be clear, but her backers have already created a new super PAC to support a potential 2016 presidential bid.

    A group called "Ready for Hillary" registered Friday with the Federal Election Commission. Its chairperson? Allida Black, a George Washington University professor and historian, who has been a vocal Clinton supporter for years.

    Four years ago, Black called for President Barack Obama to name Clinton as his vice presidential pick, and she helped launch a political action committee called WomenCount that pushed back against calls for Clinton to drop out of the 2008 Democratic presidential primary. In its first month of operation, WomenCount PAC raised more than $350,000.

    "She's the candidate that I have wanted for decades," Black, who did not immediately respond to a request for comment, told The New Republic in 2008. "I had heard about Hillary for a good 15 years before Bill ran in '92, and I was for Bill because of Hillary."

    Ready for Hillary's treasurer is listed as Judy A. Beck, who is married to Black, according to Black's Twitter profile.

    This is the second Hillary Clinton-themed super PAC to materialize this month. Davenport, Iowa, resident Nigel Wallace formed Hillary Clinton Super PAC on January 10. He declined to comment on its creation.

    Update: Jan. 28, 2013, 3:55 p.m.: In an email to the Center for Public Integrity, Black described Ready for Hillary as "a small group of skilled and dedicated Hillary supporters and Obama supporters" who are ready to devote their "organizational expertise and energy to helping Hillary become president." She continued: "Our purpose is simple: we are ready to work for Hillary to be president when she is ready to run. When our website launches in a few weeks, we plan to reach out to our grassroots networks and contributors to mobilize them to support her."

    Secretary of State Hillary Clinton exits a limousine.Michael Beckelhttp://www.publicintegrity.org/authors/michael-beckelhttp://www.publicintegrity.org/2013/01/28/12082/pro-hillary-clinton-super-pac-created

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