Sunday, October 17, 2010

Gary Palmer: Closing argument to an Alabama jury

  I invite you to imagine yourself as a member of a jury seated for a major corruption case. This week's column will be presented as the criminal prosecutor's closing argument:

  "Normally, defendants are individuals whose decisions and subsequent actions are prosecutable offenses under the law. However, the defendant in this case is not a person; it is a system that allowed a form of corruption that that has been used to buy influence with elected officials at every level of government in Alabama.

  "The system I am referring to is the system created to carry out multiple transfers of campaign contributions through a labyrinth of Political Action Committees, or PACs. Over the years, this system has become a sophisticated campaign money laundering operation employed to influence legislation and elections. It is the abuse of this system that is now at the center of the recently announced FBI indictments of four state senators, three high profile lobbyists and two very high profile gambling facility operators.

  "This system originated from two advisory opinions issued in 1989 and 1991 by Don Siegelman, then Alabama's attorney general. These advisory opinions circumvented the 1987 Fair Campaign Practices Law that made it clear that corporations could contribute no more than $500 per candidate per election and that also prohibited the hiding of the identity or source of contributions.

  "In retrospect, it is Siegelman's 1989 advisory opinion that created the opportunity for corporations and businesses to ignore the law's contribution limits by claiming that they could give as much as they wanted to as many PACs as they wanted. His 1991 advisory allowed them to direct the PACs to give the money to the candidate of their choice. With no restrictions on transfers among PACs and other political committees, this laid the foundation for a system perfect for guiding enormous amounts of money through a maze of PACs with absolute confidence the voters would never figure it out who was behind the money.

  "Such practices are a clear violation of the intent of Alabama's 1987 Fair Campaign Practices Act, Code of Alabama 1975, § 17-22A-18 which states in part: It shall be unlawful for any person to make a contribution in the name of another person, or knowingly permit his or her name to be used to effect such a contribution made by one person in the name of another person, or for the candidate or political committee to knowingly accept a contribution made by one person ....

  "'Person' is defined in § 17-22A-2 (8) as: an individual, partnership, committee, association, corporation, labor organization or any other organization or group of persons.

  "It is clear that the intent of the 1987 Fair Campaign Practices Act was to ensure that the voters of the state of Alabama would be able to identify the people funding the campaign of every politician running for office in this state.

  "Siegelman's advisory opinion allowed the creation of hundreds of new PACs. Incredibly, there are now 859 PACs registered with the Alabama Secretary of State. From 2006 through mid-October 2010, these PACs have receipted contributions totaling over $162 million which is an astounding amount of money by anyone's standards.

  "Lobbyists who oversee these PACs have created dozens of PACs for the sole purpose of multiple transfers of campaign contributions or to dilute the amount of the contribution. One lobbyist has more than 50 PACs registered in his name, including 44 that received over $1 million in contributions from the Poarch Creek Indians. This money was then transferred to other PACs that then made contributions to candidates currently running for office.

  "According to those responsible for passage of the 1987 Fair Campaign Practices Act, it was never intended to be used by PACs to hide the true source of the money funding a candidate. Clearly, the legitimate purpose of PACs has been subverted for the benefit of a few extremely powerful special interest groups who have used the PAC-to-PAC transfers to secretly influence elections for state and local government in direct violation of both the spirit and the letter of Alabama's election laws. In the process, they defrauded the people of Alabama of fair and honest elections and of transparent and honest government.

  "It is clearly evident that this abuse is one of the reasons Alabama ranks as one of the worst states in the nation for public corruption with an embarrassingly long list of public officials convicted of corruption. And with the recent indictments, it appears that list could possibly grow even longer.

  "I believe it is time for the citizens of Alabama to act and speak with a strong voice against these corrupt activities. It is time to declare the system of PAC-to-PAC transfers guilty and sentence it to a complete and permanent ban.

  "I rest my case."

  About the author: Gary Palmer is president of the Alabama Policy Institute, a non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families, which are indispensable to a prosperous society.

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