Profiles in Corruption Read online

  Dedication

  For my mom, Kerstin Schweizer

  Contents

  Cover

  Title Page

  Dedication

  1: The Crannied Wall

  2: Kamala Harris

  3: Joe Biden

  4: Cory Booker

  5: Elizabeth Warren

  6: Sherrod Brown

  7: Bernie Sanders

  8: Amy Klobuchar

  9: Eric Garcetti

  10: Conclusion

  Acknowledgments

  Notes

  Index

  About the Author

  Also by Peter Schweizer

  Copyright

  About the Publisher

  1

  The Crannied Wall

  It is often the small acts of corruption that herald the giant ones to follow.

  Taken on their own, Bill and Hillary Clinton’s little corruptions while he was Arkansas attorney general and governor might have seemed like no big deal. Hillary got favorable treatment from commodity traders and she made almost $100,000 trading cattle futures.1 Leveraged power also got them cut in on a little real estate deal called Whitewater.2 Yet, now we can see how these small liberties fit a pattern of using public power for personal gain, the scope of which has been limited only by the influence of the public office they held.

  By the time they achieved national power in Washington, the size and scope of their corruptions began to snowball. In the waning days of his White House tenure, Bill Clinton infamously pardoned billionaire fugitive Marc Rich, who had donated to his campaign.3 As Hillary Clinton joined the U.S. Senate and then served as secretary of state in the Obama administration, they cranked up the pay-to-play operation known as the Clinton Foundation. For those who still doubt the corrupt nature of the Clinton Foundation, they should examine the internal review done of the foundation at the request of Chelsea Clinton by the law firm Simpson Thacher, publicly available courtesy of the leaked emails of Clinton campaign chairman, John Podesta. The review discovered that high-dollar donors to the foundation “may have an expectation of quid pro quo benefits in return for gifts,” and that the charity ignored conflict of interest guidelines.4 There is also the stunning change in the fortunes of the Clinton Foundation following Hillary Clinton’s loss in the 2016 election. While the Clintons now had more time than ever to raise money from foreign and domestic sources for their foundation, donations plummeted dramatically. Hillary Clinton’s first year as secretary of state coincided with the foundation raising $249 million; in 2017, the year after her loss, it managed to raise only $38.4 million. Anyone who does not see the connection between the Clintons’ official government power and their ability to raise money overseas is clearly not paying attention.5

  Then of course, there was the moving of her entire email communication system onto a private server to avoid compliance with the Freedom of Information Act (FOIA) and other federal laws.6

  As the old saying goes, if you cannot trust someone with a little power, you had better not trust them with a lot. With the Clintons, there were early warning signs that often went unheeded. Today the Clintons are part of American political history, but others are emerging to take their place in the progressive pantheon with their own nascent models of corruption. The challenge now is bringing the latest warning signs to light—and taking them seriously.

  Arguably the greatest American political novel, Robert Penn Warren’s All the Kings Men is set in the Depression-era Deep South. It tells the story of Jack Burden, the scion of a wealthy and influential family with a penchant for history, who becomes the right-hand man to Governor Willie Stark, a charismatic populist. Stark grew up hardscrabble poor and rides into office promising to be a reformer who will make everything right.

  But he’s also a corrupt blackmailer who leverages his power for his own personal ends.

  Burden refers to Stark as “the Boss,” an allusion to the fact that Stark has built his political empire through cronyism, corruption, patronage, and intimidation. The Boss wants Burden to investigate one of his fiercest critics, Judge Irwin. The Boss wants dirt on the judge, and he expects Burden to “make it stick.” The problem: venerable Judge Irwin is a father figure to Burden; they were very close during his childhood, and Burden is confident that there is no dirt to be found. The Boss disagrees: “Man is conceived in sin and born in corruption, and he passeth from the stink of the didie to the stench of the shroud. There’s always something.”

  Burden does what Stark asks and starts to dig into Judge Irwin’s finances. Much to his profound disappointment, he discovers that the Boss is correct: his old family friend is corrupt. He took a bribe. Burden also learns that Judge Irwin is actually his father.

  Burden traces the serpentine flow of corporate money to the judge himself, observing what he calls “the flower-in-the-crannied-wall theory.”

  So I plucked the flower out of its cranny and discovered an astonishing botanical fact. I discovered that its delicate little root, with many loops and kinks, ran all the way to New York City, where it tapped the lush dung heap called Madison Corporation. The flower in the cranny was the Southern Belle Fuel Company. So I plucked another little flower called the American Electric Power Company, and discovered that its delicate little root tapped the same dung heap.7

  The corrupt facts are exposed. Dishonored and distraught, Judge Irwin commits suicide.

  Warren’s analogy, a study in contrast between the attractive flower and its dark roots, winding their way in the muck, sustaining the surface beauty, succinctly describes the labyrinthine set of deep relationships enjoyed by some prominent American politicians today. Hidden self- and family-enriching relationships lie beneath the charismatic exterior. While few today would follow the outdated pattern of 1930s bribery, current political figures often benefit from financial ties with special-interest parties that are hard to trace, obscured behind what seems like a rock wall. Tracing those money roots may take much digging, but understanding the flower’s, or politician’s, ecosystem within “the crannied wall” reveals how they use (or would use) whatever public power is vested in them.

  Part of the challenge is first identifying the tie between political power and those with whom they leverage their position. These are the roots behind the crannied wall. Jack Burden calls these “a relationship in time.”8

  Those complex rooted relationships provide the background for how politicians wield power—leverage their position—for their own benefit, or for the benefit of those close to them.

  All the King’s Men is a study in how politicians can wrap their public acts in the glory of the “public good,” while actually leveraging power for themselves. The Boss is the perfect example of the crusading politician who says he wants to change the system—and perhaps even does—but ultimately crusades for his own advancement and that of those close to him.

  While many today want to talk about income inequality in America, the larger divide is one of power inequality. What makes so many people angry at Washington is the fact that those with political power get to operate by a different set of rules than the rest of us. They use their own levers of power to protect their family and friends from the scales of justice; bail out their failing businesses; steer taxpayer money to them. When they misstep, they are excused or it is covered up. While those with little or no power have to pay for the consequences of their actions, the political class often does not. The power elite—the people who grease the wheels for themselves—are the most disconcerting and dangerous ones.

  In my experience, Willie Stark, whom Warren modeled after Louisiana governor Huey P. Long, is often imitated in American politics today, although in a far less crude manner. The Willie Starks of today talk about lif
ting others up but in fact they use their positions to advance and enrich themselves, their family, and their friends, and do so using methods and deceptions that we generally call corrupt, whether or not the evidence allows legal prosecution.

  Let me be clear: there are also true public servants, on both sides of the aisle, who navigate the challenging world of politics with integrity, and for the good of the country. But they appear to be a dying group.

  Willie Stark articulates perfectly that corruption is a profound human problem. Public power, and thus influence, makes it tempting to leverage your position for the direct benefit of yourself, family, friends, and those who will keep you there. The greater the public power, the longer the lever arm a politician has to tip the scales.

  This book focuses on progressive politicians—not because they alone are vulnerable to corruption—far from it. Clearly, the abuse of political power is a human problem across the full spectrum of political beliefs. But I focus on progressives here because they are unique in one respect from all others on the contemporary American political scene: they all favor the rapid and radical expansion of federal political power in the United States. Whether their goal is to pursue an abstract idea such as economic equality, transform the health care system, or use the judicial system to right social wrongs, progressives are unique in asking citizens to trust government officials with even more power than they currently possess.

  In short, progressives are asking us to give them more leverage over our lives. Their policy ideas would dramatically increase power inequality in America between the political class and the rest of America.

  In contrast to classical liberals, who for centuries have been concerned about the concentration of and abuse of power, progressives have positioned themselves as more concerned with pursuing their goals than exploring the problems that come with misuse of that power. It is one of the great ironies that while modern progressives speak often about the abuse of power by others, they rarely are willing to address the blunt realities that their desire for greater power creates new opportunities for leverage and corruption. Millennial American big government as we know it is already a result of early-twentieth-century progressive reasoning that arose in response to machine politics and corruption in America’s major cities and small towns. Progressives, so called for their goal of “progress” out of the dark age of such corruption, theorized that the solution was to increase federal government proportionally to fight existing corruption. For the People, the government would bring Light to such Darkness. And while some corporate darkness was expelled by this theory in action, more was created as the increase in government meant more crannies in which it could hide. More money roots to take hold.

  This generation of American progressives again posits Corporate America and its corruptions as the source of American problems, from health care and education, to roads and economic inequalities. They variously claim again that they will fight the darkness of such corporate power with the light of greater power for themselves in Washington.

  It therefore seems fair to ask: How have they individually exercised whatever public power they have held so far? Have they been good stewards of their vested power, or have they wielded that saber for personal benefit, including benefits extending to family and friends? What secret entanglements do they hold?

  Good stewardship of power is an ethical, not just a legal, standard. Do these progressives honor that standard, or do they operate on the principle of avoiding jail? Good stewardship of power speaks of a commitment to a level playing field, equal opportunities, and equal legal standards—liberty and justice for all—better than any stump speech.

  Some of those profiled here have run urban political machines; others have been legislators most of their lives. Some of those profiled here have been in politics less than a decade but have managed to leverage their position with dramatic effect to their own benefit. Others have been on the national stage for decades and have slowly built the capacity to leverage for their family. What follows are not personal biographies. You will not see a discussion of personal matters, their positions on issues, or their votes on bills, except as they relate to their manipulation of the system for their benefit.

  Much of what you read in the chapters to follow will be strikingly new. Even those who follow the news are likely to be startled by the fact that the revelations about these figures long in the national spotlight have rarely been mentioned before. How does that happen?

  Part of the problem is that political figures have become increasingly masterful at “appearing to be scrutinized without revealing anything significant.”9 We are fed tantalizing trivial matters, but little of investigative substance.

  With the growing obsession with the horse race aspect of politics, the media, our so-called Fourth Estate, is also a major culprit. News has become a sporting event, with breathless accounts of who is ahead, who is behind, and what the polls say. “We know from decades of research that the mainstream media tend to see elections through the prism of competition,” as one scholar puts it.10 Horse race political journalism is easier to produce than investigative reporting. You simply interview PR-happy insiders, attend some campaign events and assess crowd size, and check the polls.

  As Professor Thomas E. Patterson of the Shorenstein Center notes, “Journalists’ focus on the Washington power game—who’s up and who’s down, who’s getting the better of whom—can be a fascinating story but at the end of the day, it’s food for political junkies. It’s remote enough from the lives of most Americans to convince them that the political system doesn’t speak for them, or to them.”11

  Then there is what you might call the Trump Vortex. The media has increasingly become fixated on one political figure: President Donald Trump. Some of the reporting on Trump has been terrific; some of it has been terrible. Either way, the singular focus on Trump creates the false impression that no other prominent politicians have done anything remotely ethically suspect or relevant to the discussion, and thus deserving the light of news coverage.12

  Make no mistake, Trump, as one of the most powerful people in the world, should be scrutinized by journalists—just not at the expense of failing to investigate other politicians, especially those aspiring to the same job and level of power.

  The Washington Post reportedly added sixty jobs to its newsroom to cover a variety of beats—but primarily focused on Trump. “The new Trump administration promises great upheaval, conflict and, I’d expect, an unprecedented volume of high-level leaks, some of which will produce eye-opening stories and series,” noted Fred Ryan, Washington Post CEO and publisher. Washington Post associate editor and journalistic legend Bob Woodward explains further, “We have twenty people working on Trump, we’re going to do a book, we’re doing articles about every phase of his life.”13

  The New York Times has likewise committed vast resources to investigating Trump. The Times, for example, had three reporters spend more than a year digging through more than 100,000 pages of documents relating to Trump family finances.14

  What these journalists have not been focusing on is how some of today’s best-known political figures have leveraged their connections to benefit themselves, their friends, or their families.

  What follows is a series of narratives exploring how America’s leading progressives have exercised power during their rise to prominence. It also lays out for the first time many of the entangling alliances that these progressives have with financiers, or even foreign governments. Readers will be surprised to learn, for example, that Elizabeth Warren’s son-in-law appears to have financial ties to the Iranian government.

  The pathways of these progressives are different, so likewise the conduct exposed in each story is different. Each has a “business model” for leveraging their position and power for personal benefit.

  Who benefits from the corruption that follows in the chapters you are about to read? The politicians themselves are often indirect beneficiaries when the benefits go to a family
member, close friend, or associate to obscure the corrupt act. Essentially, it boils down to four groups of people: family, friends, donors, and machine patrons.

  The methods used also often fall into specific categories. There are the sweetheart deals involving family members and friends. The family has long been the pathway that political figures use to route power and benefits for their own self-enrichment. Technically, it is not self-enrichment, but practically speaking, money flow to family increases the wealth of the family estate. International bribery standards are quite clear: money or deals given to a politician’s family or close friend in return for a favor is as much a bribe as if the money went straight to the politician. The same must be said for leveraging their position: the politician whose family is given deals is no different from the politician who receives those deals himself. In the chapters that follow, Joe Biden emerges as the king of the sweetheart deal, with no less than five family members benefiting from his largesse, favorable access, and powerful position for commercial gain. In Biden’s case, these deals include foreign partners and in some cases even U.S. taxpayer dollars.

  Another method is income generation, whereby political power translates into a direct revenue stream for political figures or their family members. Elizabeth Warren benefited enormously from the government power she wielded early in her government career to the tune of millions of dollars. And her daughter benefits financially from her proximity to her mother as a powerful U.S. senator. Some of the politicians studied here appear to have family cultures that feel entitled to use political status and power for their own benefit, and relish in the opportunities presented. Sherrod Brown has used his legislative authority to the benefit of his class-action attorney brother, pushing a strange health care agenda that dovetails with his brother’s litigation. Los Angeles mayor Eric Garcetti’s family has benefited from his ability to approve major real estate projects.

  Another powerful form of political corruption involves bending the law. Does it seem as if some people get away with everything? Political power can be wielded to create “unequal protection under the law.” Some of those profiled here have held elected positions as prosecutors and they have leveraged their power to advance the interests or protect the interests of their powerful friends. Guilty parties, even of serious crimes, go free because of their connections to the politician. This is the cover-up, a powerful subset of bending the law.