The Gristle

Coal’s Black Fingerprints

Wednesday, October 23, 2013

COAL’S BLACK FINGERPRINTS: Last week the curtain descended on the reporting of campaign contributions and expenditures for this election cycle. At the close of the financial reporting required by the Washington State Public Disclosure Commission, in the PDC’s last-minute contribution report 21 days before the general election, more than $447,000 had funneled into the races for Whatcom County Council, easily a record for those positions. A little more than half of that amount, or $287,000, had been reported as spent, so we can expect a flood of late, targeted mass media buys, last-minute claims that cannot be easily rebutted or refuted, the Dirty Tricks eclipse of local elections. Beware.

The race for Whatcom County Council and the effect that outcome may have on coal exports has risen to prominent national attention, with this election perhaps the most important public referendum ever on global climate change. This interest has produced an unusual, unprecedented amount of “outside money” flowing into our local election. Compounding this has been a general loosening of campaign finance restrictions for corporate and NGO donors at both the federal and state level, meaning money can flow more easily and abundantly into local campaigns. And money is useful in campaigns.

By the time final reporting is in, more than $1 million in campaign money will have flooded into the backwater Fourth Corner.

“Outside money” tends to clump around single prominent issues, and is not particularly concerned with the minutiae of local governance. But voters should be. Council will vote not only on this issue, but scores of others.

“Both sides are doing it,” yes, the rubric goes; but the manner in which both sides are doing it is markedly different.

Of the $447,000 officially reported so far, easily three dollars in four have funneled into the campaigns of progressive council candidates Barry Buchanan, Ken Mann, Carl Weimer, and Rud Browne. No, let’s call them moderate candidates, since their pledge is to follow and apply the law, which seems a de minimis requirement for public office, the least voters might expect from officeholders. A more telling metric are the numbers of campaign contributions in amounts under $100, an amount that might be pulled from an average person’s pocketbook. Here, these moderate candidates have received nearly six times the amount of contributions, hundreds of individual contributions, compared to those received by their challengers and competitors for their respective seats on council. The names of these small donors are known and familiar—they’re your friends and neighbors and co-workers, members of your church and PTA.

So recognize that to be even holding their own in contributions, the challengers of these moderate candidates are especially beholden to large-scale, big-budget donors with huge cash infusions.

Big donors are finite, and their contributions are capped by state law. Which means to contribute above this cap, these donors must circumvent the law. Generally this is done through cut-outs—a donor gives money to a trusted intermediary, who then launders the money back into the campaign—and by glossing or stalling the disclosure of these contributions in order to conceal this coordination. The cut-out can also conceal the original source of the money.

This was how the coal industry was able to covertly funnel more than $40,000 into the campaigns of the non-progressive, non-moderate candidates back in April. It is also how coal interests were apparently able to flood more than $154,000 into the coffers of these candidates over the summer and fall in a dozen instances of alleged campaign finance abuse, according to a complaint filed last week with the state Attorney General’s office.

According to the complaint, two political committees used the same firm as campaign treasurer to shuttle money back and forth between accounts, defeating the requirements for timely disclosures, including a requirement to disclose large donors in media buys. The two committees themselves—Save Whatcom and Whatcom First—appear to be mostly shells with minimal records. Both formed in mid-September, evidently for the purpose of shuttling money covertly between them.

Among the contributors, according to the complaint, was SSA Marine, the project applicant for the Cherry Point pier, at $12,000. An additional $100,000 arrived from Cloud Peak Energy, a coal supplier with potential exporting interest in Cherry Point, and Global Coal Sales of Columbus, a brokerage that markets coal for export partners. The latter companies share interlocking management, according to Bloomberg. Another $32,000 arrived from donors in Houston, Texas, with strong ties to both the coal industry through their company, Quintana Minerals, and the tea party. In total, eight dollars in ten arrived from out of state. Perhaps more interesting, Save Whatcom was able to coax this amount of money from these groups after only a month in existence. Nearly all of this arrived in a mid-October cash dump, just as the shutter came down on expenditure reports. We won’t have a clear picture of where and how this money is distributed and spent until after the election.

As detailed by the public policy group Sightline, “Only a small fraction of the pro-coal money comes from Whatcom County, or anywhere in the Northwest for that matter. Almost all of it can be directly linked to firms or people with a strong financial interest in Northwest coal exports. And much of the coal money seems to originate from sources that tilt heavily toward Republican [and tea party] politics.”

Coal’s black fingerprints are all over this election.

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