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Attempt to Block IRS Rulemaking on Nonprofit Political Activity Would Exacerbate Problem of Money in Politics
Statement of Lisa Gilbert, Director, Public Citizen’s Congress Watch Division
WASHINGTON
An amendment to block the adoption of new regulations to clarify what constitutes political activity for nonprofits would only continue to encourage huge sums of secret contributions to be improperly funneled into our elections. It also would make it harder for nonprofits to engage in allowable civic engagement activities.
The attachment of this rider, offered by Sen. Rob Portman (R-Ohio) and Pat Roberts (R-Kansas), which would suspend for one year any IRS rulemaking related to 501(c)(4)s (nonprofits) including a new candidate-related political activity definition, is inappropriate and unnecessary.
The current vague IRS standard governing eligibility for nonprofit status has led to confusion for nonprofits and challenges for the IRS. In addition, the existing IRS regulations are responsible for hundreds of millions of dollars in secret contributions being improperly laundered by campaign organizations posing as "social welfare" groups.
The IRS is in the process of addressing this problem. Lawmakers should let the agency do its job.
Public Citizen is a nonprofit consumer advocacy organization that champions the public interest in the halls of power. We defend democracy, resist corporate power and work to ensure that government works for the people - not for big corporations. Founded in 1971, we now have 500,000 members and supporters throughout the country.
(202) 588-1000LATEST NEWS
Rahm Emanuel Made Alarming Stock Trades as Ambassador to Japan
A report on the "suspiciously timed" trading comes as the longtime party insider mulls a run for Democratic National Committee chair.
Nov 19, 2024
"Siri, what is insider trading?"
That's how one reader responded to Tuesday reporting by The American Prospect's Daniel Boguslaw that Rahm Emanuel, who is supposedly mulling a bid for Democratic National Committee (DNC) chair, made some concerning financial moves while in his current government job.
Emanuel is the U.S. ambassador to Japan. He was previously the mayor of Chicago, a Democratic Illinois congressman, and a key adviser to former Presidents Barack Obama and Bill Clinton. While in the House of Representatives, he chaired the Democratic Congressional Campaign Committee and then the party's caucus in the chamber. He's also been an investment banker.
As Boguslaw detailed Tuesday:
Periodic transaction reports filed with the Office of Governmental Ethics over the past two years suggest that Chicago's golden boy may be better served returning to his roots on Wall Street, given the six-figure trades he executed at highly opportune moments in U.S.-Japanese trade relations.
Among the millions of dollars of stock trades Emanuel conducted between 2021 and 2024 while serving as ambassador, one purchase jumps out. On September 29, 2023, Emanuel bought between $250,000 and $500,000 worth of stocks in CoreWeave, a leading AI cloud computing service.
Emanuel's purchase took place one day before the Japanese government announced a $320 million subsidy to Micron Technology to manufacture storage components that are essential to the Nvidia chips which CoreWeave relies on for its AI computation services.
Emanuel "purchased between $100,000 and $250,000 worth of Ocient stock on March 8, 2024, before the close of the firm's series B raise," after the Illinois "data analytics company's CEO Chris Gladwin traveled to Japan in October on a trade delegation mission," Boguslaw noted. "At the end of July, Rahm also purchased between $50,000 and $100,000 worth of stock in Monroe Capital, a Chicago-based middle-market lender that specializes in collateralized debt obligations, the Frankenstein financial product that crashed global markets in 2008."
While Emanuel did not respond to the Prospect's request for comment, Jeff Hauser, executive director of the Revolving Door Project, declared on social media that it was a "MASSIVE STORY!"
Hauser told Common Dreams that "being ambassador to Japan is a big job, but normally owing to its importance to America's relationship with a key ally in a critical area of the globe, and not because of the access it apparently provides to actionable stock tips."
"Ambassador Emanuel's brain ought to have been focused on improving America's lot in East Asia, not maximizing his retirement account," he said. "We at Revolving Door Project have long argued that senior government officials should be limited to investing in diversified mutual funds rather than stock by stock. That Emanuel was making exotic investments in businesses he may have learned about on the government's dime only underscores the need for such reforms."
"If Democrats are to ever put a full and final end to Trumpism, they are going to need to develop a clear and consistent critique of why corruption by public officials is a bad thing. That would make Rahm Emanuel among the worst possible choices for DNC chair, especially since Sen. Menendez seems likely to be unavailable for the position," Hauser added, referring to Bob Menendez, a former Democratic senator from New Jersey who in July was convicted of taking bribes.
As Common Dreamsreported last week, progressive critics of Emanuel have called his potential leadership of the DNC—after various devastating losses for the party on Election Day earlier this month—a "sick joke" and "the worst idea in the world."
Noting Emanuel's consideration of the job in an email to supporters on Tuesday, Congresswoman Alexandria Ocasio-Cortez (D-N.Y.) said that "there is a disease in Washington of Democrats who spend more time listening to the donor class than working people. If you want to know the seed of the party's political crisis—that's it."
"The DNC needs an organizer who gets people," she asserted. "Not someone who sends fish heads in the mail."
Martin O'Malley, a former Democratic presidential candidate and Maryland governor, and Ken Martin, the Minnesota Democratic-Farmer-Labor Party chair and a DNC vice chair, have both formally launched their campaigns for the position.
Other potential contenders for the DNC post include Wisconsin Democratic Party Chair Ben Wikler and Chuck Rocha, a political strategist for the latest campaign of Sen.-elect Ruben Gallego (D-Ariz.) and the presidential campaign of Sen. Bernie Sanders (I-Vt.).
Sanders, who caucuses with Democrats, said after the elections earlier this month that "it should come as no great surprise that a Democratic Party which has abandoned working-class people would find that the working class has abandoned them."
According toCBS News:
Rocha said he's still waiting to see how the field develops before jumping in, and "if there's a better candidate that really stands for what I want to see done with the party."
But Rocha has set several action items he would take as chair: eliminate education requirements for senior DNC positions, mandating that state parties "be more inclusive" and diverse with consultant hiring, and to focus on building party infrastructure in all 50 states.
Asked about Martin's and O'Malley's campaigns, Rocha called them "names that are from the institution."
"I think we need somebody from the outside and a strategist to come in and rebuild the party," said Rocha, who noted that his non-college background and upbringing in East Texas could be an advantage as the party looks to reconnect with working-class voters.
Politicoreported Tuesday that another Sanders ally, James Zogby, "expects to formally launch his campaign in the coming days."
A longtime DNC member and president of the Arab American Institute, Zogby told Politico that he was motivated to run by his anger over Republican President-elect Donald Trump's defeat of Democratic Vice President Kamala Harris.
Zogby criticized Harris for campaigning with former Rep. Liz Cheney (R-Okla.), said the Democratic Party was too "focused on suburban women and not on white working-class people," and called the decision to not invite a Palestinian American to speak at the national convention "unimaginative, overly cautious, and completely out of touch with where voters are."
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'Fund Housing Not Genocide': Arrests at Capitol Protest Over US Complicity in Gaza
Demonstrators called on Congress to invest in climate action, education, healthcare, housing, and jobs rather than arming Israel.
Nov 19, 2024
At least 44 people were reportedly arrested at the U.S. Capitol in Washington, D.C. on Tuesday for a protest over government complicity in Israel's assault on the Gaza Strip, as Congress prepares for key votes this week.
The demonstrators who descended on the Philip A. Hart Senate Office Building are "members of faith groups, moms, healthcare workers, educators, students, [and] veterans," according toZeteo reporter Prem Thakker.
Participants wore red T-shirts and unfurled banners—which footage on social media shows were snatched by police—urging Congress to fund climate action, education, healthcare, housing, and jobs, "not genocide." There were also messages pushing lawmakers to "stop arming Israel" and telling them it is "time to act."
Thakker reported that the protesters were calling on senators to support joint resolutions of disapproval (JRDs) that Sen. Bernie Sanders (I-Vt.) introduced in September and plans to bring to the floor for a vote on Wednesday.
The JRDs would block the sale of U.S. tank rounds, bomb kits, and other weapons to the Israeli government, which faces a genocide case at the International Court of Justice for an assault on Gaza that has killed at least 43,972 Palestinians.
So far just six other members of the chamber—Sens. Tim Kaine (D-Va.), Jeff Merkley (D-Ore.), Brian Schatz (D-Hawaii), Chris Van Hollen (D-Md.), Elizabeth Warren (D-Mass.), and Peter Welch (D-Vt.)—have signaled support for the resolutions.
Even if the JRDs were passed by the Senate, they would need to get through the Republican-held U.S. House of Representatives to reach President Joe Biden's desk—and if the Democrat vetoed them, an override requires two-thirds support in both chambers.
Citing Capitol Police, ABC News reporter Beatrice Peterson said Tuesday that "all 44 individuals arrested were charged with crowding, obstructing, and incommoding. Two of them were also charged with assault on a police officer."
Meanwhile, in Illinois, 13 members of Chicago's chapter of Jewish Voice for Peace (JVP) were arrested for shutting down Caterpillar's Business and Analytics Hub by blocking escalators and elevators.
"Caterpillar builds armored D9 bulldozers that the Israeli military uses in its genocidal campaign in Gaza and to demolish homes in the occupied West Bank," JVP Chicago said in a statement. "This protest comes at a historic moment: This week Congress is set to vote on legislation to block U.S. weapons sales to the Israeli government."
As the Chicago protesters were arrested, they called on Sen. Tammy Duckworth (D-Ill.) to support Sanders' resolutions.
The other upcoming congressional vote garnering attention from anti-genocide activists is H.R. 9495, which would empower the treasury secretary to strip organizations of their nonprofit status by labeling them terrorist supporters with no due process. Republicans are reviving the bill after it failed to pass the House via a fast-track procedure last week, despite bipartisan support.
JVP's national arm has called H.R. 9495 "dangerous and unconstitutional," and warned that it "would give the incoming Trump administration the power to unilaterally shut down nonprofit organizations it doesn't like."
"This bill is part and parcel of the MAGA assault on democracy and fundamental freedoms," JVP said, "and it must be defeated again."
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Watchdog Aims to Track Army of 'Self-Enriching Grifters' Slated to Join Trump's Cabinet
"The man who once said he was going to drain the swamp is instead flooding it."
Nov 19, 2024
As U.S. President-elect Donald Trump continues to select Cabinet picks for his second administration—and at least one is facing headwinds to confirmation despite a Republican-controlled Senate—the nonprofit consumer advocacy group Public Citizen Tuesday unveiled a new resource to keep tabs on potential conflicts of interest among Trump's appointees.
"Like the first Trump administration, this administration appears ready to staff critical government posts with as many corporate lackeys and self-enriching grifters as they can hire," said Lisa Gilbert, co-president of Public Citizen.
The group's other co-president, Robert Weissman, said that"Donald Trump may have run for office pretending he was going to advocate for regular people, but his appointments show in reality he’s planning to govern, again, on behalf of the corporate class."
"The man who once said he was going to drain the swamp is instead flooding it," Weissman added.
Trump has already chosen many of the individuals he would like to serve in his Cabinet and other senior positions. On Tuesday he picked Mehmet Oz, the celebrity physician and TV personality known as Dr. Oz, to helm the Centers for Medicare and Medicaid Services.
Other high profile picks include nominating Robert F. Kennedy Jr.—a once prominent environmental lawyer who has spread false claims about vaccines—to head the Department of Health and Human Services, and selecting prominent Trump donor and the world's richest man Elon Musk to oversee a yet-to-be-created government agency devoted to slashing government spending and federal regulation. Musk will oversee that agency, the so-called Department of Government Efficiency, with biotech billionaire Vivek Ramaswamy.
Public Citizen's tracker so far details information for nine appointees, a list that "includes both Cabinet-level positions and other political appointments, many of which do not require Senate confirmation," according to a statement from the group. The tracker will be updated regularly and includes where the individual worked previously and former clients and/or business interests.
Sean Duffy, Trump's pick for transportation secretary, previously worked for the lobbying firm BGR Group, according to the tracker, where he lobbied on behalf coalition that included multiple airlines.
The group also details the past work of Susie Wiles, Trump's selection for chief of staff. Wiles has been a registered lobbyist on behalf of dozens of clients, including a tobacco company "that sought to block federal health restrictions on its candy-flavored cigars" and on behalf of a mining company "that wants to eliminate federal opposition to its plan to dig a massive mine in a pristine watershed," according to additional information on Wiles provided by Public Citizen that is linked in the tracker.
"As chief of staff, she'll be in a position to influence permits, approvals, and contracts that her former lobbying clients paid her to lobby for," according to the tracker.
The tracker notes that Musk's former clients and business interests include "himself" and the companies he owns, several of which are currently under federal probe. According to a longer briefing on Musk by Public Citizen, at least three of the entrepreneur's companies are currently under scrutiny for alleged misconduct by at least nine federal agencies. According to a pre-election breakdown by The New York Times, Musk's companies were "promised $3 billion across nearly 100 different contracts last year with 17 federal agencies." Both the probes and the contracts underscore Musk's exposure to a federal government that he is slated to play a key role in.
Musk has framed his quest to curb government regulation as existential. "Unless Trump wins and we get rid of the mountain of smothering regulations (that have nothing to do with safety!), humanity will never reach Mars," he wrote on X in early October.
After Trump's victory earlier this month, legendary consumer advocate Ralph Nader, who founded Public Citizen but hasn't been formally involved with the group for decades, warned of Musk's influence.
"Get ready this January for chaos, revenge, greed, rampant abuses of power, and the unbridled control of corrupt plutocrats and oligarchs," Nader wrote. "With Elon Musk in the lead."
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