Andy Kroll

Reporter

Andy Kroll is Mother Jones' Dark Money reporter. He is based in the DC bureau. His work has also appeared at the Wall Street Journal, the Detroit News, Salon, and TomDispatch.com, where he's an associate editor. He can be reached at akroll (at) motherjones (dot) com. He tweets at @AndrewKroll.

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Mitch McConnell vs. the World

The 2014 campaign is 22 months away. But liberals and tea partiers are already plotting the ouster of America's most influential Republican.

—By Andy Kroll

| Wed Jan. 16, 2013 4:06 AM PST

Sen. Mitch McConnell is the most influential Republican in America, a position he solidified earlier this month when he brokered a tax cut deal with Vice President Joe Biden to stop the nation from careening off the so-called "fiscal cliff." But he's hardly popular. With a state approval rating in the high-30s, the Senate minority leader, who hails from Kentucky, feels the heat from conservatives and liberals alike. Now, with almost two years until his 2014 reelection, the gang of activists eyeing McConnell is so diverse—from tea partiers and Ron Paul fanatics to Democrats and unions and campaign finance reformers—it might as well be a joke setup.

No fan of McConnell before the fiscal cliff drama, Kentucky right-wingers are mobilizing to take on their senior US senator. After House Speaker John Boehner (R-Ohio), burdened with his rowdy caucus, failed to negotiate a deal on tax cuts, McConnell succeeded. But back home, grassroots conservatives grimaced as McConnell crafted a bipartisan agreement heavy on tax hikes on the superrich and light on spending cuts. Leading tea party activists say they're laying the groundwork for a "Ditch Mitch" effort: fundraising, meeting with members across the state, and quietly vetting candidates who could challenge McConnell in a GOP primary. Meanwhile, some of the most powerful liberal organizations in the country have identified McConnell, one of the most effective defenders of big-money politics, as a target in 2013 and 2014. "It'd be political malpractice not to push back on him," says David Donnelly, the executive director of the Public Campaign Action Fund.

McConnell could be vulnerable. He commands enormous respect in Washington, but his popularity waxes and wanes back home. In 2008, he squeaked past Democrat Bruce Lunsford, the former treasurer of the state Democratic Party, by 6 points. A December survey by the left-leaning Public Policy Polling rated McConnell the least popular US senator, with 37 percent statewide approving of him and 55 percent disapproving. In a hypothetical matchup with the actress Ashley Judd, whose name has been floated as a Democratic challenger, a poll commissioned by McConnell's campaign put him up by just 4 points. Of course, McConnell's weak numbers are partly due to his visible role as a leader in Congress, which polls worse than colonoscopies, traffic jams, and Nickelback.

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Half of Republicans in Congress Are Apparently Cool With America Defaulting

—By Andy Kroll

| Mon Jan. 14, 2013 8:09 AM PST

House GOP Reps. Dave Camp (R-Mich.), Joe Barton (R-Texas), Roy Blunt (R-Mo.), Cathy McMorris Rodgers (R-Wash.).

Fuming over a fiscal cliff deal devoid of big spending cuts, the Republican Party is cranking up the crazy talk by pledging anew to hold America hostage in the brewing fight over raising the nation's debt ceiling.

Politico quotes GOP leaders in Congress as saying that "more than half" of Republicans in Congress are willing to let America default "unless Obama agrees to dramatic cuts he has repeatedly said he opposes." Still more Republicans are itching to shut down the federal government, a la Clinton and Gingrich in 1995-96, unless the president bows to their demands: Deep spending cuts to domestic programs, Medicare, Medicaid, and Social Security, but none to military spending.

What's most jarring about the GOP's willingness to default or grind the government to a halt is how brazenly political the party's reasons are for doing it, per Politico:

House Speaker John Boehner "may need a shutdown just to get it out of [House Republicans'] system," said a top GOP leadership adviser. "We might need to do that for member-management purposes—so they have an endgame and can show their constituents they’re fighting."

A default—or even a down-to-the-wire debt ceiling drama (see: 2011) that ends with a deal—has real economic consequences for working Americans. It could jack up interest rates on student loans, car loans, home loans, and credit card debt. It would increase borrowing costs for the government itself. And Federal Reserve Chairman Ben Bernanke has said that a default could torpedo the US economy's slow yet steady recovery.

But in the minds of Congressional Republicans, those facts don't appear to outweigh the need to rebuke Obama. Nor does House Speaker John Boehner's desire to avoid a government default, according to Politico:

Boehner assumes he can ultimately talk members out of default, but he is so wounded and weakened from last month’s tax-hike battle that the speaker might very well be wrong. Obama assumes Republicans would never be so foolish as to put the economy at risk to win a spending fight. Conservatives say he’s definitely wrong on that score. They say he’s the foolish and reckless one for piling up $6 trillion in debt on his watch.
The coming spending fights make the Christmastime tax increase battle seem like child’s play. While everyone knew the tax drama would end with the rich paying more taxes, no one can telegraph how the coming spending fights will unfold. And the economic stakes are more dire.
"For too long, the pitch was, we'll deal with it next time," said Rep. Jason Chaffetz (R-Utah). He said GOP lawmakers are prepared to shut things down or even default if Obama doesn’t bend on spending. "No one wants to default, but we are not going to continue to give the president a limitless credit card."

The administration, meanwhile, says it will not negotiate over raising the debt ceiling, and will not use gimmicks like a trillion-dollar coin to raise the debt ceiling and keep the government operating. So on one side Republicans stand ready to do real damage to the country to make a point and keep the voters back home happy; on the other side is the Obama White House, refusing to even negotiate a deal in exchange for raising the debt ceiling. Buckle up, folks: It's going to be a turbulent month or two here in Washington.

Ex-IRS Director on Dark-Money Groups: "Investigate Them and Prosecute Them"

The IRS needs to crack down on political nonprofits, experts say—or risk looking weak and useless.

—By Andy Kroll

| Mon Jan. 14, 2013 4:06 AM PST

Big dark-money groups like the Karl Rove-advised Crossroads GPS promised the IRS they would have "limited" involvement in politics—in order to protect their nonprofit tax-exempt status—yet went on to spend hundreds of millions of dollars to influence the 2010 and 2012 federal elections. Now several tax policy experts, including a former high-ranking IRS official who ran the division overseeing nonprofits, say the IRS must bring the hammer down on these shadowy nonprofits or risk looking weak and useless.

"The government's going to have to investigate them and prosecute them," says Marcus Owens, who ran the IRS's tax-exempt division for a decade and is now a lawyer in private practice. "In order to maintain the integrity of the process, they're going to be forced to take action."

[Read the full article]

Russ Feingold: Democrats Sold Out in 2012 and Need to Quit Big Money

—By Andy Kroll

| Thu Jan. 10, 2013 10:01 AM PST

Former Sen. Russ Feingold (D-Wisc.).

President Obama's decision to let his 2013 inauguration committee accept corporate cash and million-dollar donations marks quite a reversal for the president: for his first inaugural in 2009, he capped individual donations at $50,000 and banned corporate money. The Associated Press calls the decision "part of a continuing erosion of Obama's pledge to keep donors and special interests at arm's length of his presidency." But for former Sen. Russ Feingold, it's yet another sell-out by his friends in the Democratic Party to the big-money forces so dominant in politics today.

No Democrat has so publicly ripped his own party for embracing super-PACs and dark-money nonprofits than Feingold. In a new article for the journal Democracy, Feingold, who co-wrote the 2002 McCain-Feingold Act, the last major campaign finance restriction in the US, takes Democrats to the mat. He calls 2012 "a big step" back for Democratic-led efforts to get big money out of politics, and singles out Obama's reversal on super-PACs. In February 2012, the president encouraged his donors to give to Priorities USA Action, the super-PAC backing him, while allowing his top deputies to appear at Priorities events. On the PBS NewsHour, top Obama strategist David Axelrod defended Obama by saying that the president hadn't warned at all toward super-PACs but had to play by the rules of the game. You heard that a lot from Democrats in 2012. Yet with statements like that, Feingold says, Democrats were posing as a pro-reform party while tripping over themselves to "exploit any avenue to accept unlimited, corporate dollars to fund elections."

Beltway Democrats, Feingold argues, aren't going to reform big-money politics from the inside; they're addicted and they just can't quit. The task of fighting for real reforms to money in politics, of building what Feingold—who now runs his own pro-reform nonprofit, Progressives United—calls a "permanent majority" for reform, falls instead to liberal donors and activists outside of Washington.

Feingold says the most important thing big donors can do is stop giving—to super-PACs or any of the other Citizens United-enabled fixtures of our big-money politics. "Donors hold more leverage to create a movement for reform than almost any other actor in the political system," he says. If donors ignore super-PACs and nonprofits, "Washington will notice." And as for the liberal activists out there, they should redirect all the energy they've invested into passing a constitutional amendment reversing the Supreme Court's Citizens United decision and channel it into "achievable goals"—public financing of elections, disclosure of donors to dark-money nonprofits and shell corporations, overhauling the dysfunctional Federal Election Commission, the nation's top elections cop.

The stakes are high, in Feingold's view, for the Democrats. "Unless Democrats embrace election reform as a central tenet of our platform," he writes, "we will face another era reminiscent of soft money—when the dominance of corporate interests meant that no matter what party held power, the influence of Big Money always won."

Flashback: Obama's Treasury Secretary Pick Claimed Deregulation Did Not Cause the Financial Crisis

—By Andy Kroll

| Wed Jan. 9, 2013 10:51 AM PST

Jack Lew.

President Barack Obama is expected to nominate Jack Lew, the wonky White House chief of staff and former director of the Office of Management and Budget, as the new secretary of the US Treasury. The current secretary, Tim Geithner, plans to step down soon.

Here's a crucial piece of information about Lew: He has said he doesn't believe financial deregulation was a major cause of the financial crisis. In 2010, Lew testified before Congress that the deregulation of Wall Street in the Clinton era—the repeal of Glass-Steagall, say, or the ending of real regulation of complex derivatives—wasn't a critical factor. "The problems in the financial industry preceded deregulation," Lew told members of the Senate budget committee in September 2010. He added that he didn't "personally know the extent to which deregulation drove it, but I don't believe that deregulation was the proximate cause."

Lew knows that period of deregulatory zeal well, having served as President Bill Clinton's director of the Office of Management and Budget from May 1998 to January 2001. Lew has spent much of his career in government, is a savvy negotiator and budget wonk, and is respected by Republicans and Democrats. Republicans, though, have been grumbling about him more recently—after all, in 2011, he outsmarted the congressional GOP in intense budget talks. And liberals have criticized Lew for his post-Clinton work for the mega-bank Citigroup, where he ran a unit that profited off shorting the housing market.

Lew's 2010 claim that deregulation wasn't a major cause of the financial crisis is disputed by many experts as well as the government's own investigatory body, the Financial Crisis Inquiry Commission. In its final report (PDF), the commission stated that "widespread failures in financial regulation and supervision proved devastating to the stability of the nation's financial markets."

The commission went on to conclude, "More than 30 years of deregulation and reliance on self-regulation by financial institutions, championed by former Federal Reserve chairman Alan Greenspan and others, supported by successive administrations and Congresses, and actively pushed by the powerful financial industry at every turn, had stripped away key safeguards, which could have helped avoid catastrophe."

Obama, Lew's boss, has said before that deregulation played a major part of the financial meltdown. In October 2008, Obama, then the Democratic candidate for president, said "we know that it's because of deregulation that Wall Street was able to engage in the kind of irresponsible actions that have caused this financial crisis."

Upon signing the Dodd-Frank financial reform bill, which was chock-full of new regulations, in July 2010, Obama noted the failure of the regulators and the banks: "It was a crisis born of a failure of responsibility from certain corners of Wall Street to the halls of power in Washington. For years, our financial sector was governed by antiquated and poorly enforced rules that allowed some to game the system and take risks that endangered the entire economy."

It's clear Obama believes deregulation played a role in the crisis. Apparently, he's fine with a treasury secretary who's a former Clintonite not eager to acknowledge the Clinton era's mistakes.