Josh Harkinson

Josh Harkinson

Reporter

Born in Texas and based in San Francisco, Josh covers tech, labor, drug policy, and the environment.

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Bank of America to Rick Perry: "We will help you out!"

| Fri Aug. 19, 2011 6:24 PM EDT

The producers of Wall Street: Money Never Sleeps couldn't have staged better coda: During the meet-and-greet following Texas Governor Rick Perry's appearance at the New Hampshire Politics and Eggs breakfast this week, a mysterious man approached Perry and apropos of nothing said, "Bank of America. We will help you out." Then he silently moved on. 

Politico's Ben Smith identified the exec as James Mahoney, Bank of America's director of public policy. A bank spokesperson told Smith that the only "help" Mahoney was offering was nonpartisan policy expertise. But Mahoney is also chairman of the bank's New Hampshire PAC, which doles out political cash.

The interaction takes place at precisely 40 minutes:

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Rick Perry's 10 Worst Crony Capitalists

| Wed Aug. 17, 2011 6:05 AM EDT
Texas Gov. Rick Perry

If presidential candidates were elected based on how well they rewarded their political donors, then Texas Governor Rick Perry would lead the pack. Since 2001, more than a fifth of the $83 million in campaign donations received by Perry have come from his past and present political appointees. In 2009, the group Citizens for Responsibility and Ethics in Washigton cited his administration's rampant cronyism in naming him to its "Worst Governors" list. A recent analysis of Perry's 150 largest political donors by the LA Times found that more than half of them received hefty business contracts, tax breaks, or appointments from the governor. Here are ten Perry supporters who've been handsomely repaid for their patronage:

  1. Bob Perry: America's largest individual political donor, the Houston-based homebuilder has given $2.3 million to Rick Perry, making him the governor's leading money man (the two Perrys aren't related). In June, 2003, Rick Perry helped push through a bill creating the Texas Residential Construction Commission, ostensibly a watchdog for unethical homebuilders. In reality, the agency was created with the help of Bob Perry's lobbyist, John Krugh. Shortly after receiving a $100,000 check from Bob Perry, the governor appointed Krugh to the TRCC's board of directors. Consumer groups fought back and got the agency abolished in 2009.
  2. Harrold Simmons: The reclusive buyout king has amassed $5.7 billion from garbage collection, drug stores, metals, and chemicals, making him the 55th richest American. In 1995, he set about converting an isolated patch of land in West Texas into a nuclear waste dump. In part, that's meant dumping $1.2 million in campaign cash on Perry. Though three staffers with Perry's Texas Commission on Environmental Quality resigned rather than approve the waste dump, it was ultimately green-lighted by TCEQ executive director Glen Shankle, who left the agency a few months later to work as the dump's lobbyist. In January, a commission stacked with Perry appointees gave the dump permission to accept nuclear waste from around the country.
  3. David Nance: In 2009, the founder and chairman of Convergen LifeSciences Inc, a tiny biotechnology firm, applied for a $4.5 million grant from Texas' Emerging Technology Fund, a sort of public-sector venture capital fund. When the grant was denied, Nance appealed the decision to a Perry-appointed statewide advisory committee (of which Nance had once been a member), the Wall Street Journal reports. The committee ruled in favor of Nance, who has given more than $100,000 to Perry's campaigns since 2001. But that's not all. Perry also appropriated $2 million in state funds to a business-services nonprofit, Innovate Texas, which pays Nance a six-figure salary but does not have a working phone number, the Journal reports.
  4. Lonnie "Bo" Pilgrim: In March 2008, the owner of the Pilgrim's Pride poultry company met with Perry and soon after gave him a $100,000 donation for the Republican Governor's Association, which Perry chaired at the time. Less than a month later, Perry asked the Environental Protection Agency to waive ethanol standards that Pligrim believed would drive up chicken feed costs. Pilgrim later donated $25,000 to Perry's political action committee and footed the bill for him and three aides to fly to Washington, DC, to speak out against ethanol.
  5. Kenneth Lay: In 2001, Rick Perry appointed an Enron exec to chair the Texas Public Utilities Commission, and the next day, Perry got a $25,000 check from Lay. As Molly Ivins mockingly pointed out, Perry "explained this, to everyone's satisfaction, as being 'totally coincidental.'"
  6. B.J. "Red" McCombs: The San Antonio Clear Channel billionaire, who contributed nearly $400,000 to the governor, is the primary financial backer for a Formula One racetrack to be built near Austin. The state has pledged $25 million a year in subsidies to support the project, the LA Times reports.
  7. Mike Toomey: Perry's former chief of staff earned up to $2.2 million last year as a Texas-based lobbyist. He owns a private island in New Hampshire with Dave Carney, Perry's campaign manager. In 2007, Perry signed an executive order requiring all teenage girls in Texas to take a vaccine manufactured by Merck, one of Toomey's lobbying clients (the legislature eventually repealed the order). Toomey is now creating a Perry-focussed super-PAC, Make Us Great Again.
  8. Phil Adams: A college friend of Perry's who gave his campaigns at least $314,000, Adams was a backer of Terrabon Inc, a Houston company that received a $2.75 million grant from Perry's Emerging Technology Fund.  Perry also appointed Adams to a coveted post on Texas A&M University's Board of Regents (other regents who aren't Perry supporters say they've been pressured to resign). Adams has returned the favor by giving the Perry family free tickets and transportation to basketball and football games. 
  9. James Leininger: The state's largest political donor during much of the 1990s, Leininger gifted Perry's campaigns at least $264,000, in addition to a $1.1 million loan that's credited with putting him over the top in a 1998 race for lieutenant governor. Leininger is an investor in Gradalis Inc, a Dallas biotechnology firm that received $1.75 million from Perry's Emerging Technology Fund, the Dallas Morning News reports.
  10. James Dannenbaum:  Donated more than $320,000 to Perry's campaigns and received multiple transportation contracts from the state. His company, Dannenbaum Engineering, was implicated last year in an FBI investigation of El Paso officials who'd swapped political donations for county contracts, according to the El Paso Times. In 2007, Perry appointed Dannenbaum to the University of Texas Board of Regents.
     

Major Study Links Decline of Unions to Rising of Income Inequality

| Mon Aug. 1, 2011 7:30 AM EDT

It's well known that the death of America's labor unions coincides with a staggering rise in income inequality, though the link between the two has never been as obvious as it seems. Many academics argue that unions play a relatively minor role in the equation, instead blaming educational disparities and the shifting makeup of the economy. But now comes a major new study from Harvard sociology professor Bruce Western that suggests that the decline of unions is as important as any other factor, explaining a full third of the growth in of income inequality for male workers.

The loss of labor unions explains a full third of the growth of inequality for male workers

Western and co-author Jake Rosenfeld, a sociology professor at the University of Washington, looked at the period between 1973 and 2007, when inequality in hourly wages spiked by 40 percent. During that time, union membership for private-sector male workers fell from 34 percent to 8 percent (female workers were never as unionized as their male counterparts). Their paper in the August issue of the America Sociological Review concludes that deunionization's biggest effects on inequality were indirect: 

1) The threat of unionization caused non-unionized employers to raise wages; that threat disappered along with unions.
2) Unions occupied a bully pulpit; knocking them off left the moral case for equality vulnerable to attack. (What do you mean Viacom's CEO isn't worth $85 million?)
3) Workers lost their Washington lobbyists, and with them, any hope of winning political battles for better wages and benefits.

These ideas are nothing new. Kevin Drum ably explores them in his March/April Mother Jones essay, "Plutocracy Now." Yet the Harvard study bolsters them with a rigorous regression analysis of census data, showing empirically what many pundits have long suspected. "Our study underscores the role of unions as an equalizing force in the labor market," Western says. If only proving their importance was as easy as figuring out how to replace them.

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