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Thursday, January 20, 2005

American Kingmakers - Billionaires Back Schwarzenegger and Bush

this is an audio post - click to play


Unlike contributions to candidates, federal law allows unlimited donations to inaugural committees and allows corporations to make them. As we posted yesterday, some of the biggest corporations and wealthiest individuals are taking advantage of this loophole to foot the bill for the presidential inauguration. More than 50 corporate and individual donors have ponied up the $250,000 it takes to be named an "underwriter".

As Matt Stearns reports for Knight-Ridder, at least one of these $250,000 donors, energy firm Southern Co., has said about their donation: "We view this as a patriotic event and a patriotic thing to do." So, we here at TheRestofUs.org figured we'd take a look at another part of our democracy - the California initiative process - where corporations and rich folks are allowed to use their wealth to their heart's content to see just how far the patriotism extends.

With his sell-out performances over the course of the last two years, it is impossible to talk about cash in the California initiative process without talking about the King himself, Governor Schwarzenegger. Since vowing to rid Sacramento of special interests in 2003, Schwarzenegger's myriad committees have raked in nearly $50 million, not to mention the millions his buddies plan to raise this year to back initiatives that mirror the Guv's agenda.

Our examination reveals that at least 23 donors to the 2005 inauguration (who contributed a total of nearly $5 million) have also contributed to King Arnold and the various committees he controls (for a total of nearly $4.3 million). Additionally, at least five fundraisers were held for Schwarzenegger by contributors (or the contributor's CEO, if a company) to the inaugural committee: Johnson and Johnson heir Robert Wood Johnson IV, The Limited Chairman Leslie Wexner, Qualcomm CEO Irwin Jacobs, NVR Inc. Chairman Dwight Schar, and San Diego Chargers owner Alex Spanos. These close friends of Arnold gave $650,000 to the inaugural committee.

So what's the problem, right?

Well, as we said yesterday, huge donations to the inaugural committee do not pose as much of a threat to our democracy as do huge donations to candidates or ballot committees. If our laws governing the way elections are financed were truly fair and democratic, we wouldn't need to worry about wealthy interests financing our country's inauguration. But they are not fair.

At the federal level, $2,000 limits allow a tiny fraction of wealthy donors to dominate the process by which our president and congressional representatives are elected. In 2004, thousand-dollar donors made up half of all donations to presidential candidates.

In California, gubernatorial candidates can hit up their millionaire buddies for $22,300 a piece. For ballot initiatives, for which Schwarzenegger has a particular fondness, there are no limits. The ballot initiative process, started by progressive Republican Hiram Johnson back in 1911 to provide citizens with a way around legislators guided by wealthy interests, has been corrupted by the millions which wealthy interests are able to spend to obtain the public policy of their choice.

In America, we value independence and liberty perhaps as much as any country in the history of the world. But this liberty does not and should not extend to the ability of the rich to dominate our democratic processes, whether it be at the federal or state level. Arnold Schwarzenegger recognized this when he campaigned on a promise to end the dominance of special interests in Sacramento. Unfortunately for the rest of us and the democracy in which we would live, Schwarzenegger has forgotten this promise, choosing instead to throw in his lot with those who believe their wealth earns them the king's ear.

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