T H E G AZ ET T E
Wednesday, January 8, 2014 r
Funny money
Money is the mother’s milk of politics: having it doesn’t guarantee victory, but not having it almost always guarantees defeat. Campaign money also has become a battleground in this year’s governor’s race. In November, Democratic candidate Doug Gansler invited his chief rival, Anthony Brown, to reject so-called “dark money” spending during the primary election. Banning such “outside spending” by PACs, unions and anyone except the candidate’s own campaigns was a self-serving Gansler ploy masquerading as good government. Third-party MY MARYLAND spending on BLAIR LEE ads and voter turnout benefits Brown, because most third-party groups (unions, PACs, incumbents, etc.) are in his camp. Conversely, limiting campaign spending to the candidate’s war chests benefits Gansler, who’s raised more than Brown. So Brown declined Gansler’s invitation. But the most interesting aspect of Gansler’s good government trap was his proposed penalty: any candidate who violates the pledge must make a campaign donation to a charity. Turns out that it’s illegal in Maryland for a candidate to direct a contribution to a charity or nonprofit. Why? Because that’s how elected officials, particularly in P.G. County, “laundered” unsavory campaign donations. Instead of taking money from developers or other special interests that might look bad on the candidate’s financial report, candidates directed the money to charities in their districts and then took credit for it. That’s why it’s now illegal. The latest money battle involves another fundraising ban, a 1997 law prohibiting fundraising during the General Assembly’s 90-day session (mid-January to mid-April). The ban applies to the governor, lieutenant governor, attorney general, comptroller and all 188 members of the legislature.
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It’s a curious law unless you understand its origins. If lobbyists and special interests want to legally bribe state lawmakers with campaign contributions, why ban such corruption only during the 90-day session while allowing it the rest of the year? Answer: Because the 90-day session ban wasn’t demanded by the lawmakers, it was demanded by the State House lobbyists! That’s right, in 1997 the lobbyists went to the presiding officers begging for relief from legislators who were preying on them during the session. For instance, if a lobbyist’s bill was up for an afternoon committee vote, the committee chairman or key members would sometimes hold a sudden “fundraising breakfast” to which the lobbyist, with check in hand, was invited. Some legislators didn’t even bother with the breakfast subterfuge — just give me the check. The lobbyists were getting eaten alive. That’s why it’s now illegal. The 90-day session ban wasn’t problematic until this election because, except for ending same-day session extortion, it didn’t have much effect. State lawmakers still had plenty of time to shake down the special interests before and after the session. But moving Maryland’s primary election (the most important election in one-party Maryland) from September to June 24 made the ban a political battlefield. Once the session adjourns in mid-April, only a two-month primary campaign remains. So, money for media ad buys, direct mail and election day mobilization must be on hand early. Gubernatorial tickets that can’t fundraise during the session are at a huge disadvantage. For instance, neither Doug Gansler (attorney general) nor his running mate Jolene Ivey (delegate) can fundraise during the session. Likewise, Lt. Gov. Anthony Brown is banned. But how about his running mate, Ken Ulman? If Ulman was running for re-election as Howard County executive he wouldn’t be covered by the ban, but shouldn’t he be covered now that he’s Brown’s ticket mate? No, says the state elections administrator, Linda Lamone. Even though state law unifies the candidates into a single ticket (when you vote for governor you automatically
vote for his/her running mate) and even though whatever Ulman raises independently during the session can and will be transferred into the Brown/Ulman joint account, the state elections board views them as separate entities for fundraising purposes so long as Ulman and Brown “don’t coordinate their fundraising during the 90 day session.” Huh? Didn’t the legislature just outlaw campaign contributions by LLCs, partnerships and other “separate entities” under single control because donors were using them to circumvent campaign contribution limits? Yet, the “separate entities” fiction is OK to circumvent the 90day session ban? Here’s the tip-off: Brown “has said all along he would follow the letter of the law as defined by the Board of Elections,” said Brown’s spokesman. Translation: We are confident that the board appointed by Brown’s biggest backer, Gov. O’Malley, will give us a favorable ruling whether it makes sense or not. The five-member Elections Board (three Dems, two Republicans) is appointed “with the advice and consent” of the State Senate (i.e. Mike Miller). The elections administrator, who runs the elections office, was appointed for a six-year term by the governor up until 2002, when a Republican, Bob Ehrlich, won. To keep Ehrlich from replacing Linda Lamone, a Miller loyalist, the Dems stripped Ehrlich of his appointment power and made Lamone de facto administrator for life (she’s in the 17th year of her six-year term). So, just as the Brown camp expected, the elections board helped Brown and hurt Gansler, whose camp is now suing. But all this inside baseball gets eclipsed in two weeks when the candidates must disclose how much money they’ve actually raised to date and how much they have on hand. That’s when we’ll know who’s for real and who’s not.
Blair Lee is chairman of the board of Lee Development Group in Silver Spring and a regular commentator for WBAL radio. His column appears Fridays in the Business Gazette. His past columns are available at www.gazette.net/blairlee. His email address is blairleeiv@gmail. com.
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LETTERS TOT HE EDITOR
Another view of the Affordable Care Act Your Jan. 1 edition carried a letter by Hrant Jamgochian lauding the introduction to Maryland of the so-called Affordable Care Act [“Affordable Health Care means more will be covered”]. I wonder if many Marylanders would agree with Mr. Jamgochian’s assessment. Mr. Jamgochian’s letter starts by claiming that, “100,000 Marylanders will have access to high-quality health care because of the Affordable Health Care Act.” But then, later in the letter, he says that 77,000 Marylanders have successfully created accounts. Of course, that doesn’t mean they are insured. Let’s assume, though, that [as of] Jan. 1 they are actually insured. What then of the 76,000 Marylanders who received cancellation notices as of Nov. 12, something Mr. Jamgochian neglects to mention. On net, then, at most, 1,000 more Marylanders will be insured after Jan. 1, not the 100,000 that Jamgochian wants you to believe is the case. A paltry increase for an unbelievable painful experience for many Marylanders. Jamgochian neglects to mention other serious issues in his rosy assessment of the ACA. One is the cost of the new plans. Many if not all the plans cost more: the premium is higher and the deductible is much higher than for many of the canceled plans. A case in point is Bowie State University. What cost $54 per semester per student is now $900 per semester. The consequence: Bowie State stopped offering health insurance. Of course, those students are just the kind of people needed for the ACA to work, and that leads to another issue. If the newly insured comprise primarily those who are more elderly or more ill than expected, the insurance premiums will have to be raised yet further for the insurance companies to survive. So what is now barely affordable will become completely unaffordable. Yet another issue Jamgochian neglects to mention is the way small businesses [are affected] after Jan 1. If they are on the hook for a lot more money, they will probably drop their plans as well, leaving their employees in limbo. Jamgochian seems to believe, like many, there is a free lunch, but there isn’t.
WRITE TO US The Gazette welcomes letters on subjects of local interest. Please limit them to 200 words. All articles are subject to editing. No anonymous letters are printed. Letters are printed as space permits and are limited to one per person per month. Include your name, address and daytime telephone number. Send submissions to: The Gazette, attention Commentary Editor, 9030 Comprint Court, Gaithersburg, MD 20877; fax to 301-670-7183; or email to opinions@gazette.net. It is costly to insure the uninsured, especially the uninsurable with pre-existing conditions. More modest changes could have been made to our medical insurance system, as for example, by transparently increasing taxes to subsidize those who are currently uninsurable. Instead, we have a surreptitious tax increase in the form of very large cost increases in medical insurance premiums (and deductibles) to subsidize the uninsurable. That is not the most efficient to subsidize the uninsurable, especially when it destroy our current system. Granted, our medical insurance system was not utopian, but it worked for many people. But, no, the whole system had to be destroyed just for those uninsurables. So it seems that [as of] Jan. 1, more people [are] uninsured than if the Affordable Care Act had never been passed, and those insured through it [are] paying a lot more. The medical insurance system we once had has now been broken, and no amount of claims to the contrary can refute that. What is replacing it appears a lot more costly. What the future holds for our medical insurance system is anyone’s guess, especially with the president changing the rules as he goes along.
Jack Rutner, Silver Spring