Planet Open Government Open Source Hacking

Sunlight Foundation: The Transparency Campaign: Who We Are

Avelino Maestas — 2010-03-12T00:37:49+00:00

A few weeks back, we asked members of our community to tells us a little about themselves: What are you looking for from their government? When it comes to transparency, what is your most important priority? What’s the best way you can help our movement in your state?

The first thing we asked was “What is the single most important political issue in your state/the country.” Many of the responses were expected considering the state of the economy and the political climate—the economy, heath care, government spending, education and immigration. In addition, a wide diversity of opinions was shared, from things like copyright reform to financial deregulation. There were some Americans, however, who share Sunlight’s aims of improving access to government information and ensuring our elected officials are accountable:

“Lack of transparency in government (legislation created behind closed doors) and personal agendas.”

“TRUST in the political process and politicians again.”

“More objective, trusted and transparent information about how money is spent and decisions are made in government.”

“Our government does not represent the citizens’ interests first.”

As an organization, the Sunlight Foundation has spent more than three years trying to show not just the public, but lawmakers, reporters and opinion leaders as well, why a more open and transparency government is a good thing. But this movement is larger than us, so we also asked respondents to explain why “government transparency” matters to them. Again, the range of responses was broad, but here are some that I wanted to share:

“It is important for me to know what my government is doing.”

“Ours is a representative republic. Our elected representatives need to be held fully accountable for their actions when they are entrusted with our votes. ”

“The ability to easily access information about lobbying activities and campaign donations allows the people to evaluate the influences on their representatives and decide who to support and who can be trusted.”

“Mischief grows in the dark, transparency and openness grows democracy.”

“In order for citizens to fulfill their role in a democracy, they must have timely access to the information they need to make decisions.”

“Government without transparency is tyranny defined.”

“I am pretty much a shut-in and I have to rely on news programs and reports on television cable, it is so much better if I can rely on information that is coming to me from a source that I can rely on and trust.”

Survey respondents were spread across the political spectrum (click for chart), but when asked about transparency issues, there was often agreement. This offers some encouragement that our issues do indeed transcend party or ideology. For example, when asked whether they thought it was important to know how Americans’ tax dollars are being spent, the vast majority of people said it was “very important.”

Another interesting breakdown is to look at the number of respondents who rely on the Internet for news. Using that data, we can see how important is it for them to have “Information on who Members of Congress are meeting with in their office and what they do day to day.”

As you can see, almost everybody who responded relies on the Internet, to some degree, for news, and they think it is either fairly or very important to know who their elected officials are meeting.

There’s one final measure I wanted to share: just how motivated these individuals are. Those who responded to the survey and signed up for the Citizens for Open Government group will form the core of this campaign, and they’re ready for action. When asked if they’d be likely to help, these are the number of people who said yes:

Call your local elected official: 76%
Distribute flyers: 65%
Participate in an event at your local officials: 76%
Participate in an event to put pressure on elected official: Yes 85%
Sign a petition: 86%
Talk to people in your community: 79%
Write a blog entry: 64%
Write letters to editor: 73%
Write letter to elected official: 88%

The campaign is already a success, because we have a foundation of Americans who not only understand the issues, but are passionate as well. We are really happy to know that this effort is being driven by such dedicated people. Or, as one respondent said:

“I hope the opportunity presented by available tools and technologies, in conjunction with the vision outlined in the Open Government Initiative, will help bring a much higher degree of accountability to government at all levels.”

I hope so too.

Sunlight Foundation: Massa, Maf54 and the Ethics Committee

Paul Blumenthal — 2010-03-11T23:18:54+00:00

And now to totally contradict my previous post stating why no one needs to talk about tickle-monster Eric Massa.

The House voted today 404-2 to recommend that the House Ethics Committee reopen their probe into Massa’s misconduct and examine whether House leaders were aware of his misdeeds and whether they failed act quickly enough. This follows on the heels of reports that an aide in Speaker Pelosi’s office was informed in October that Massa was living with aides, hired too many aides, cursed around staff and appeared to be going on dates with openly-gay male staffers from other congressional offices.

On first blush these don’t exactly rise to the level of ethics investigation material — congressmen have been known to live with aides in the past and if he wants to cheat on his wife with adult men, that’s his prerogative. Either way, the Ethics Committee should look into whether there was any more information relayed to leadership prior to the reported receipt of complaints about harassment in February and whether they responded properly or not.

Already, this case is being compared to the 2006 Mark Foley scandal. I’m not really sure that it rises to that level for a number of reasons. That being said, let’s take a look at what made the Foley scandal toxic for the congressional leadership who covered it up.

1) Members of Congress were aware as early as 1995 that Foley was interested in teenage male pages. Foley was elected in 1994. A male page who served in 1995 stated later, “Almost the first day I got there I was warned. It was no secret that Foley had a special interest in male pages.” In 2000, then-Rep. Jim Kolbe and Clerk of the House Jeff Trandahl were informed of complaints of inappropriate e-mails from Foley to teenage male pages. In 2002 or 2003, Foley appeared in the page dormitory after-hours and was visibly drunk. This information was conveyed to Trandahl who then informed Foley’s chief of staff Kirk Fordham and Fordham subsequently informed Speaker Dennis Hastert’s chief of staff Scott Palmer that Foley exhibited inappropriate behavior around pages, but did not tell him about the drunken dorm incident. Trandahl stated that Hastert’s office was informed of Foley’s behavior in 2003 and was given regular updates about his conduct.

2) In the specific incident that led to Foley’s removal from the House, congressmen were made aware of the lascivious e-mails in early-2005 (the story broke in September of 2006). Hastert’s office was made aware in the fall of 2005 and Hastert was specifically informed in early-2006. Other congressional leaders, Majority Leader John Boehner and National Republican Congressional Committee Chairman Tom Reynolds, were informed of the emails and IM conversations in the spring of 2006. Boehner and Reynolds stated that they both told Hastert about the allegations.

3) Foley was hitting on teenage pages and engaging in sexual relationships with ex-pages. This is a far-cry from going on dates with adult congressional staffers. Parents entrust their children to Congress when they are serving as pages and expect that members of Congress aren’t going to be making sexual advances on them — or that, if such a case were to arise that congressional leaders would do something about it. Also, did I mention that Foley was hitting on teenagers, not adults.

I can’t really see the Massa issue rising to this level of extreme malfeasance by leadership. It appears to have come as somewhat of a surprise to people in Washington. s probably because the guy was only a congressman for about 14 months. The complaints that were made with Pelosi’s office, if the story is accurate, rise to the level of talking to Massa’s staff, but certainly not to an Ethics Committee investigation. The complaints received by Hoyer’s office were rather more serious and his office referred the matter to the Ethics Committee almost immediately. If this is the full story, it certainly doesn’t rise to the level of the actual cover-up of Foley’s repulsive behavior.

Since the House already voted to send the issue back to the Ethics Committee, we’ll have to wait and see if everyone’s story is accurate.

Open Secrets: Rep. Eric Massa's Bankrollers: Angry, Disappointed and Disassociating Themselves from Him

Dave Levinthal & Cassandra LaRussa — 2010-03-11T23:06:46+00:00

Hundreds of people and political action committees supported freshman Rep. Eric Massa with millions of dollars because they largely considered him a left-leaning lion in an Upstate New York congressional district chocked with conservatives – a coup for Democratic faithful.

Now, Massa's political career is little more than embers inside a still-hot inferno of accusations and admissions that he routinely used sexually charged language around male staffers, when not outrightly tickling and groping them.

Massa resigned his office Monday, then submitted to live interviews Tuesday with Fox News' Glenn Beck and CNN's Larry King, both of which produced more cringe-worthy moments than, say, a naked row in a congressional gymnasium shower.

"A human train wreck," is how Democratic strategist Bob Shrum described Massa.

"[P]eople say Washington politics is a freakshow, and Eric Massa is writing a whole new chapter," said CNN senior political analyst David Gergen.

So, where does this leave Massa's legion of bankrollers who supported him during times less lascivious?

Alternately disappointed and angry, with an undercurrent of bamboozlement.

Some say they believe Massa should consider donating or returning his remaining campaign funds, which through December totaled nearly $644,000. Others want no part of such discussion – or Massa himself.

"It's his prerogative to donate the money. If he does he does, if he doesn't he doesn't, but I wouldn't be disappointed if he did donate it," Lionel Kaplan, an attorney in New Jersey who in May donated $1,000 to Massa, told Capital Eye.

"His money -- it should go to any other progressive cause to support progressives who will speak up on the environment, on heath care, the public option," said Bobette Gorden, a marketing executive in Arizona who donated $500 to Massa last year. "I really believed in him. It's such a shame. I'm not mad, I'm sad ... I don't get any pleasure from him dropping out."

Jim Spellane, media director for the International Brotherhood of Electrical Workers, said his organization is experiencing some "buyer's remorse" regarding its $34,500 in contributions to Massa.

The International Brotherhood of Electrical Workers PAC first decided to donate to Massa "in consultation with the local level" of its organization, Spellane explained.

"The goal was to elect those who supported the issues of working people," he said.
But Spellane declined to comment on whether he believes Massa should refund that money – the largest total contribution to the embattled politico by any single PAC.

Other PACs and organizations that had once supported Massa with five- and six-figure donations are completely disinclined to now discuss their association with him.

"We have no comment on any of that," said Paul Doell of the American Maritime Officers PAC, which has donated $10,000 to Massa this election cycle.

Massa is only one of six federal candidates this election cycle to receive $10,000 – the legal maximum – from the American Maritime Officers PAC, Center for Responsive Politics research indicates.

ActBlue, a political action committee and online fund-raising conduit for Democrats that sent more than $672,000 to Massa for his career, notes that it didn't directly support Massa. Instead, it processed credit card donations from individuals to Massa's campaign.

"So not only do we not have a position on his behavior, the question isn't even germane to what we do," ActBlue spokesman Adrian Arroyo said.

House Speaker Nancy Pelosi and House Majority Leader Steny Hoyer, meanwhile, both contributed tens of thousands of dollars to Massa through their leadership PACs. So has Rep. Charles Rangel (D-N.Y.), who's been hamstrung with ethical issues of his own.

Aides to both Pelosi and Hoyer said their offices would respond to questions from Capital Eye about their leadership PAC contributions to Massa. Neither office ever did.

Pelosi and Hoyer are hardly alone in their financial support of Massa, as a veritable all-star roster of Democrats helped Massa fill his campaign coffers in recent years.

This includes former President Bill Clinton, who in August conducted a fund-raiser in Manhattan for him, according to political event tracker Party Time.

Massa's all-time top contributors are listed below. Note that the organizations' contribution totals are based on donations from both political action committees and individuals associated with them:

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Contributor	Total	Individuals	PACs
ActBlue	$672,598	$672,598	$0
Corning Inc.	$45,650	$35,650	$10,000
International Brotherhood of Electrical Workers	$34,500	$0	$34,500
AmeriPAC: The Fund for a Greater America (Steny Hoyer)	$30,000	$0	$30,000
Service Employees International Union	$26,000	$1,000	$25,000
American Federation of Teachers	$25,000	$0	$25,000
American Fedn of State/County/Muni Employees	$25,000	$0	$25,000
PAC to the Future (Nancy Pelosi)	$25,000	$0	$25,000
United Auto Workers	$25,000	$0	$25,000
Teamsters Union	$24,375	$0	$24,375
Harris Corp.	$24,250	$9,250	$15,000
Plumbers/Pipefitters Union	$24,000	$0	$24,000
Sheet Metal Workers Union	$23,500	$0	$23,500
American Postal Workers Union	$22,500	$0	$22,500
Communications Workers of America	$21,000	$0	$21,000
National Leadership PAC (Charles Rangel)	$21,000	$0	$21,000
Machinists/Aerospace Workers Union	$20,000	$0	$20,000
United Food & Commercial Workers Union	$20,000	$0	$20,000
United Steelworkers	$17,500	$0	$17,500
University of Rochester	$17,250	$17,250	$0

Massa could not be reached for comment on what he plans to do with his campaign money now that he is exiting politics.

Free Our Data: …and APPSI comes out swinging

2010-03-11T20:40:43+00:00

The government’s Advisory Panel on Public Sector Information has come out with a strong response to the OS consultation.

Headline points: look at the picture, not just at OS, resolve the “fundamental contradictions” in information policy and move towards a free data regime. “In particular, OS should not have any intellectual property rights in derived data.”

Oh, and sort out the “national scandal” of the lack of a comprehensive free address register.

There’s more here. http://bit.ly/91MY2q

It’s a good read.

Open Secrets: Political Cash Largess Doesn't Equate Success in Oscars

Cassandra LaRussa — 2010-03-11T19:25:26+00:00

Last week, the Center for Responsive Politics announced the winners of the money-in-politics Oscars, which named the top political donors from a list of Oscar nominees in the categories of best lead actor, best lead actress, best supporting actor, best supporting actress, best director and best picture.

The cash totaled at more than $400,000 with the vast majority going to Democratic candidates and organizations.

Now, after a night of accolades and touching thank-you speeches, the real question: Does a movie star's political contributions correlate with them winning an Oscar?

Hopefully, you didn't place your Oscar bets based on our report, because the answer is a resounding, "not really."

The only time that the recipient of the Center for Responsive Politics' award was the same as recipient of the real Oscar was in the category of best lead actor. The winner of both, Jeff Bridges, has donated about $64,800 to various Democratic candidates, political parties and political action committees.

In the category of best supporting actor, the money-in-politics Oscar went to Matt Damon. The winner of the real Oscar was Christoph Waltz. He has not donated to a federal-level political cause during the past two decades.

In the category of best supporting actress, the money-in-politics Oscar went to Maggie Gyllenhaal. The winner of the real Oscar was Mo'Nique. She has not donated to a political cause in the past two decades.

In the category of best leading actress, there was no money-in-politics Oscar given.
The winner of the real Oscar was Sandra Bullock. She, too, has not donated to a political cause in the past two decades.

In the category of best director, the money-in-politics Oscar went to James Cameron. The winner of the real Oscar was Kathryn Bigelow, Cameron's ex-wife. Bigelow gave $550 to federal political interests, split between a Democratic candidate and the Democratic National Committee.

In the category of best picture, the money-in-politics Oscar went to Lawrence Bender. The winner of the real Oscar was Kathryn Bigelow, Mark Boal, Nicolas Chartier and Greg Shapiro for "The Hurt Locker." Bigelow was the only one of the four to make a political donation.

Sunlight Foundation: Links after lunch

Paul Blumenthal — 2010-03-11T19:23:18+00:00

1) Rep. Carolyn Cheeks Kilpatrick and a member of her staff are being called before a grand jury in Michigan. Details are not known, but her son, former Detroit Mayor Kwame Kilpatrick, has faced a series of criminal charges over the past few years.

2) The House Appropriations Committee banned earmarks to for-profit companies.

3) A Washington Examiner editorial calls for more transparency, particularly around campaign contributions, from Fannie Mae and Freddie Mac.

4) ProPublica has a terrific run-down on how the House Ethics Committee operates (or doesn’t).

Open Secrets: Congress to Obey Earmark Rules, New Business Group Gets Spendy and More in Capital Eye Opener: March 11

Dan Auble — 2010-03-11T17:02:58+00:00

Your daily dose of news and tidbits from the world of money in politics:

THE IMPERILED EARMARK: Perennial earmark opponent Rep. Jeff Flake (R-Ariz.) wants to force the House Committee on Standards to report what documents and interviews it conducted while last year investigating campaign cash-for-earmarks allegations involving now-disbanded PMA Group. The committee recently exonerated all members but released only a five-page report on the situation. Investigations by Roll Call have failed to turn up a single member or former PMA employee who was even interviewed as part of the investigation.

The issue has been heating up as a March 19 deadline to submit earmark requests for inclusion in this years appropriations bills approaches. Just this week, David Obey, House Appropriations Committee chairman, announced the panel would not approve any earmarks going to for-profit groups. House Minority Leader John Boehner indicated that Republicans are considering a self-imposed moratorium on earmarks this year and House Speaker Nancy Pelosi has made similar assertions in recent days. The White House also included improved earmark disclosure as part of a memorandum outlining how it plans to tighten the reins on special interests.

NEW BUSINESS GROUP PLANS BIG SPENDING: A new business-backed group, Employers for a Healthy Economy, plans to spend up to $10 million on advertising in an attempt to stop the latest action on health care reform. The group is funded by nearly 250 lobby groups and companies and includes money from the health insurance industry. The Washington Times reports the group’s ads will run nationally, and then in districts targeting key House members whose votes would be needed to achieve final passage.

In addition to the cash being spent on targeted advertising, the companies and industry trade groups behind the television campaign have some serious clout from years of campaign contributions and lobbying. Listed among the group’s members are the U.S. Chamber of Commerce, the Associated Builders and Contractors, the National Association of Manufacturers, and the National Retail Federation. The chamber alone spent $144.5 million last year on lobbying.

CRP IN THE NEWS: Jim Puzzanghera at the Los Angeles Times finds that legislation to create a new financial regulatory agency will likely exempt payday lenders, including some big donors to key Senators, from expanded oversight … Deborah Zabarenko reports for Reuters that the massive spending by the energy industry to influence climate change legislation will only increase in the wake of the Citizens United v. Federal Election Commission decision…Forbes reporter Liz Moyer uses CRP data in a story on the lack of regulatory reform for risky securities trading … the Philadelphia Inquirer's Jeff Shields tackles the issue of taxing soda and quotes CRP's Dave Levinthal regarding industry lobbying activity … CNNMoney.com's Jennifer Liberto notes our research in this piece about student loans.

Have a news tip of link to pass along? We want to hear from you! E-mail us at press@crp.org.

Open Congress: Congress Links

Eric Naing — 2010-03-11T16:20:00+00:00

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Here is today’s roundup of a few articles and blog posts from around the web that you should take a look at.

Leading Democrats in the White House and Congress are starting to agree on what will be in the final health care package. (The Associated Press)
But some Senate liberals don’t like the fact that they are being asked to vote against several popular measures, like a public option, for now. (Roll Call)
As the health care debate starts to focus on the Senate, the Senate parliamentarian will become more and more prominent. Here is another good profile of the current parliamentarian Alan Frumin and the role he plays. (Newsweek)
Republicans have been warning Democrats that they’ll face the wrath of voters this fall if health care passes, but recent polling shows that the public’s disapproval of the issue has started to turn in recent days. (National Journal)
Jonathan Chait further argues that Democrats should simply ignore “advice” given to them by the GOP on health care. (The New Republic)
A number of high-profile scandals have thrust the House ethics committee into the spotlight. ProPublica provides some history on the committee and explains how it does what it does. (ProPublica)
Harry Reid’s [D, NV] poll numbers indicate that he very well could be voted out of office this fall. Sen. Dick Durbin [D, IL] and Sen. Chuck Schumer [D, NY] are already jockeying to replace him as the next Senate majority leader should that happen. (Time)

Sunlight Foundation: NYT: E-mails Indicate Deepening of Scandal Surrounding Sen. John Ensign

Paul Blumenthal — 2010-03-11T15:39:42+00:00

While everyone’s been running around writing about former congresstickler Eric Massa, Eric Lichtblau and Eric Lipton of the New York Times spent some time digging further into a congressional sex scandal that actually involved some kind of corruption.

Previously undisclosed e-mail messages turned over to the F.B.I. and Senate ethics investigators provide new evidence about Senator John Ensign’s efforts to steer lobbying work to the embittered husband of his former mistress and could deepen his legal and political troubles.

Mr. Ensign, Republican of Nevada, suggested that a Las Vegas development firm hire the husband, Douglas Hampton, after it had sought the senator’s help on several energy projects in 2008, according to e-mail messages and interviews with company executives.

Investigators are looking at a number of issues including whether Ensign aided Hampton in circumventing the one-year lobbying ban for staffers-turned-lobbyists. Considering that the F.B.I. is involved in the investigation, it is unlikely that the Senate Ethics Committee will rule on ethics violations against Ensign before the criminal investigation is complete.

On a related aside: I’m with Matt Yglesias here. If you’re a journalist covering Congress, particularly ethical malfeasance in Congress, why not spend some time covering scandals like Ensign’s or Charlie Rangel or the PMA Group (and why the Ethics Committee spiked the investigation)? Do we really need more information on tickle-parties and Eric Massa’s deranged sense of self-worth?

Sunshine Review: Obama transparency update: unions exempt from rules, data guru to advise board

2010-03-11T15:19:09+00:00

Today, the Washington Post reports that the Obama administration is rolling back rules proposed by the Bush administration that expanded the financial disclosure statements required of labor unions.

Critics note the rules were rolled back while the Obama administration was seeking more stringent regulation of corporate America. This is inconsistent, making some charge that the administration is giving “preferential treatment” to unions.
Besides that, Rep. John Kline of Minnesota notes that rescinding and revoking those rules makes it more difficult for union workers to see how their dues are spent. Mr. Kline said to Labor Secretary Hilda L. Solis that Mr. Obama had “made it a point on a number of occasions to talk about this administration wanting to be the most transparent and open administration in our nation’s history.”

Mrs. Solis told the congressman that transparency was the goal, but the department did not want to “overburden a system where information that was previously asked for may not be of much importance or significance.” We’ve heard that before. The focus of transparency and open government is empowering citizens with information, not giving public officials an easy time.

Because the President has made a point to promise to claim he’ll have “the most open and transparent” administration in history,” several times, it is important for citizens like you and I to hold him to his promise and continue reminding him of it.

But all isn’t cloudy on Obama’s sunshine promises. Last week, President Barack Obama announced that he would be appointing Edward Tufte to the independent panel that advises the Recovery Accountability and Transparency Board. Many people are excited about this, including the nonpolitical. Tufte is a renown information designer, which means the White House’s transparency effort may see some of that innovation we’ve been waiting for.

Open Congress: GOP: Parlimentarian Puts Reconciliation Fix On Hold In The Senate

Eric Naing — 2010-03-11T15:12:00+00:00

Roll Call cites “senior GOP sources” as saying the Senate parliamentarian has indicated that President Obama will have to sign the Senate health care bill (H.R.3590) into law before the Senate can act on a reconciliation fix amending the bill.

One of the several options floating around to pass a health care bill is to somehow pass the budget reconciliation fix before the House votes to pass the Senate bill. This option exists to assuage jittery House Democrats who fear that the Senate bill, warts and all, may become law without the reconciliation fix.

David Waldman of Congress Matters argues that it is technically possible for the Senate to start work on a reconciliation fix for the Senate bill now since neither measure has been signed into law yet, or as he says, “although you can’t fix something that technically doesn’t exist, you’re also technically not fixing that thing until it does.”

But according to Roll Call, the Senate parliamentarian disagrees.

It’s extremely important, however, to recognize that not even the Democrats have decided on what exact route they will take to pass health care and that this ruling only affects one possible, and relative obscure, option of many. In fact, Democrats seem poised to push forward on the general frame work they’ve discussed over the past few weeks.

In a strongly worded letter to Sen. Mitch McConnell [R, KY], Senate Majority Leader Harry Reid [D, NV] blasts Republican attempts to stall and kill the bill and doubles down on reconciliation:

I know that many Republicans have expressed concerns with our use of the existing Senate rules, but their argument is unjustified. There is nothing unusual or extraordinary about the use of reconciliation. As one of the most senior Senators in your caucus, Sen. Judd Gregg of New Hampshire, said in explaining the use of this very same option, “Is there something wrong with majority rules? I don’t think so.”

Open Secrets: TSA Nominee Robert Harding's Politics, New Massa Mess and More in Capital Eye Opener: March 10

Dave Levinthal — 2010-03-11T13:43:44+00:00

Your daily dose of news and tidbits from the world of money in politics:

TRANSPORTATION SECURITY CHIEF NOMINEE NO STRANGER TO LOBBYING, POLITICAL DONATIONS: President Barack Obama's nominee to lead the Transportation Security Administration, retired Army Maj. Gen. Robert A. Harding, recently ran a defense consulting company that lobbied the federal government a bit last decade. Harding Securities Associates reported spending $10,000 in 2005 to lobby the U.S. House and U.S. Senate on a defense bill, our research indicates. Harding made at least one federal campaign contribution while running his firm, giving $1,500 to U.S. Sen. Mark Warner's campaign in 2008. A man named Robert Harding, listing the same city and zip code as the retired general, also made a $1,000 donation in September to Louis Douglass Huddleston, a Republican and former Army colonel who's running for Congress in North Carolina. It couldn't be immediately confirmed if the two Robert Hardings are indeed the same man. Harding, the general, also served on Obama's presidential transition team.

MORE MASSA MESS: Last week, Eric Massa was a relatively unknown Democratic congressman from Upstate New York. This week, he resigned his seat. He acknowledged groping and engaging in tickle fights and an "orgy" with male staffers who, with a tip to sci-fi series Battlestar Galactica, he said he'd like to start "fracking." And last night, he told Fox News' Glenn Beck about fighting -- in the nude -- with White House Chief of Staff Rahm Emanuel while the men showered at a gym. (The White House denies this.) Until Massa morphed from freshman back-bencher to nationally-televised disaster, he had been one of the Democrat's fund-raising success stories, winning a seat in a decidedly Republican district and in doing so, raising significantly more campaign cash than the average House seat victor. Curiously, none of these folks were among Massa's donors. See Beck's interview with Massa below:

CRP, IN THE NEWS: Bloomberg's Jonathan D. Salant and Phil Mattingly write about how payday loan companies could get a pass from proposed congressional regulations on the nation's financial industry. Standing to benefit from this? Payday companies and their executives who have made handsome campaign contributions to Senate members, Salant and Mattingly write, citing our research ... Other journalists noting our work in the past day include Jen DiMascio at Politico, Chisun Lee at ProPublica, Arthur Delaney at the Huffington Post, Silla Brush at The Hill, Caroline Baum at Bloomberg and Jim McElhatton at NewsMax.com.

Have a news tip or link to pass along? We want to hear from you! E-mail us at press@crp.org.

Open Congress: Senate Judiciary Committe Advances Crack/Powder Cocaine Bill

Eric Naing — 2010-03-11T13:13:00+00:00

Criminal penalties for crack versus powder cocaine touch on a wide range of issues from race to state budgets to overcrowding of prisons. The Senate Judiciary Committee today took on the issue by unanimously voting to advance a bill that would reduce the wide disparity in sentencing for possession of the two.

Donny earlier explained the the absurdity of the current law governing sentences for crack and powder cocaine:

Did you know that it takes only 5 grams of crack cocaine to trigger a mandatory minimum sentence of five years, but it takes 500 grams to trigger the same sentence for possession of powder cocaine? That’s a 100:1 ratio.

Sen. Dick Durbin’s [D, IL] Fair Sentencing Act decreases that ratio from 100:1 to 1:1. But an amended version of the bill passed by the Judiciary committee today reduced the ratio to 20:1.

The American Prospect’s Adam Serwer explains the racial implications of this disparity:

More than 80 percent of those arrested for crack have been black (despite the fact that most crack users are white)… More than 20 years since the passage of the law, the arbitrarily draconian penalties for crack cocaine have contributed to the increasing racial disparities in the U.S. prison system and helped swell the number of those behind bars to fully more than 1 percent of the entire U.S. population.

Significantly, the bill also eliminates the five-year mandatory minimum sentence for possession of cocaine.

Julie Stewart, president of the advocacy group Families Against Mandatory Minimums, is disappointed that the ration wasn’t reduced to 1:1, but acknowledges that Durbin’s bill represents significant progress on this issue:

This is an exciting vote, but also disappointing. We hoped the Committee would go further in making crack penalties the same as powder. There was no scientific basis for the 100:1 disparity between crack and powder cocaine created 24 years ago, and there is no scientific basis for today’s vote of 20:1. However, if this imperfect bill becomes law, it will provide some long-overdue relief to thousands of defendants sentenced each year.

A similar House bill (H.R.3245) was passed by the House Judiciary Committee last summer.

Open Congress: House Votes To Ban Deceptive Census Letters

Eric Naing — 2010-03-11T10:34:00+00:00

With the 2010 Census looming, many groups, including the Republican Party, have sent out fundraising mailings that are deceptively similar to the official Census form. Yesterday, the House unanimously voted to limit this practice.

Specifically, Rep. Carolyn Maloney’s [D, NY-14] Prevent Deceptive Census Look Alike Mailings Act (H.R.4621) requires anyone sending mail marked “census” to provide their name and address and to state that they are not affiliated with the government. In a rare showing of bipartisanship, two far-right lawmakers, Rep. Darrell Issa [R, CA-49] and Rep. Jason Chaffetz [R, UT-3] were also prominent sponsors of the bill.

Earlier this year, the Republican National Committee and the National Republican Congressional Committee were criticized for sending out fundraising letters marked “2010 CONGRESSIONAL DISTRICT CENSUS” and “Official Document.” The letters, which imply but don’t directly claim an affiliation with the U.S. Census Bureau, are legal.

Ironically, the NRCC letter was written in the name of House Republican leader John Boehner [R, OH-8], who also voted in support of Maloney’s bill. Sen. Tom Carper [D, DE] promises to push the idea in the Senate.

Open Congress: Meet Sen. Corker's Payday Lender Friend

Donny Shaw — 2010-03-11T08:55:00+00:00

Last month, when bipartisan financial reform negotiations where breaking down in the Senate Banking Committee, Sen. Bob Corker [R, TN] stepped up from out of nowhere and volunteered to take over for Ranking Member Sen. Richard Shelby [R, AL] on representing the Republicans at the negotiating table. By all accounts, he has in fact managed to keep the bipartisan negotiations alive. He and Sen. Chris Dodd [D, CT] are reportedly ready to introduce their bill to the full Senate imminently.

The New York Times reported yesterday that one of the concessions Corker has won from Dodd is a special exemption in the proposed Consumer Financial Protection Agency’s (CFPA) enforcement powers for payday lenders and other nonbank credit dealers. These are generally the most predatory of lenders, commonly charging interest rates as high as 400 percent. Corker’s exemption would allow the CFPA to create rules to regulate the payday loan industry, but it would’t give the agency any power to enforce the rules like it could for banks and mortgage dealers.

Talking Points Memo yesterday ran a profile W. Alan Jones, Bob Corker’s payday loan shark/multi-millionaire friend and political supporter, and how he may have influenced Corker’s decision to fight for the regulatory exemption for his industry:

Meet W. Allan Jones, who in 1993 founded Check Into Cash, a pay-day lending chain that says it now has 1,100 stores in 30 states. The company offers short-term loans designed to tide customers over until their next paycheck. But the interest rates can be as much as 400 percent on an annualized basis, meaning that they lead many borrowers to end up digging themselves deeper into debt.

Lately, Congress has been mulling how to structure a new Consumer Financial Protection Agency (CFPA), so as to avoid a repeat of the financial crisis. And reform advocates have argued that increased regulation of pay-day lenders is an essential piece of the puzzle. But after lobbying by an industry group that Jones helped establish, Sen. Bob Corker (R-TN) acted to thwart the new agency’s ability to effectively monitor Jones’s industry.

As Harper’s noted in a story on the pay-day lender industry last year entitled “Usury Country,” “a payday loan essentially becomes a lien against your life, entitling the creditor to a share of your future earnings indefinitely.”

“It’s the craziest business,” Jones told a reporter in 2008. “Consumers love us, but consumer groups hate us.”

The business has been good to Jones, 56, however. In 2005, a Tennessee business magazine put his net worth at $500 million — high enough to put him on a list of the state’s richest 20 people, alongside FedEx founder Fred Smith and Thomas Frist Jr., the hospital entrepreneur and father of former Senate leader Bill Frist.

And Jones hasn’t been shy about displaying that fortune. According to the magazine, Jones’s 400-acre home boasts an air-conditioned muscle car garage, which includes a $300,000 Maybach; an on-site greenhouse with a full-time horticulturist; a three-story tree house; and — get this — a regulation-sized football field with lights, a scoreboard and supporting field house and stand, which he used to host the first-ever private college football game, raising $100,000 for University of Tennessee-Chattanooga.

[…]

Corker’s intervention came after intense lobbying from the Community Financial Services Association (CFSA), a trade group of pay-day lenders created in 1999 by Jones and others in the industry. In the last three months of 2009, CFSA spent $500,000 lobbying Congress on the financial regulatory reform and other issues affecting regulation of the pay-day loan industry, according to disclosure records examined by TPMmuckraker. (One of the top Washington lobbyists hired by CFSA, Wright Andrews of Butera & Andrews, was also the prime lobbyist for the sub-prime mortgage industry earlier this decade.)

Jones is a longtime backer of Corker — as well as of several other lawmakers, from both parties, on the Banking committee. Since 2001, Jones, his relatives, and his employees, have contributed $31,000 to the campaigns of Corker, a former Chattanooga mayor, according to the New York Times.

The pay-day lenders say it was the banks, not them, that caused the financial turmoil, so they shouldn’t be penalized for it. But consumer groups, and their allies in Congress and the Obama administration, argue that the competitive pressure on the banks from less regulated sectors like the pay-day lenders prompted the banks to lower their lending standards, helping to create the mortgage crisis. And they add that the predatory practices of the pay-day lenders merit greater regulation in their own right.

Sunlight Foundation: Introducing the Cycle of Transparency

Jake Brewer — 2010-03-11T01:39:52+00:00

Government transparency is that rarest of political phenomena — a great idea with support across the political spectrum and popularity among the public. Yet, here we are in the 21st century with every tool we would need to make government more transparent and accountable, and still we are operating with a government that often behaves as it did in the 19th century.

So, transparent government is a good thing, but we do not yet have one. Now what?

It’s clear that there is a breakdown between conceptual support for the idea of government transparency and enacting the changes necessary to make it so. There is fear and resistance to change inside government that requires cultural, political, and attitude adjustments. And there’s a large gap between the good intentions of citizens and watchdog groups and think tanks and reporters, and translating those good intentions into effective results. Many people want to act, but they rarely know how or where to begin.

For many, the concept of transparency still simply feels too vague to get behind in a meaningful way. People strongly support transparency in theory, but don’t know what they would need to do, or how they would need to think, to create the “open, transparent government” we talk about.

We’ve grappled with these challenges at Sunlight since our founding four years ago, and have been thinking about it with increased urgency over the last year in particular. How do we connect all the necessary parties and resources, and how do we put them together and act on them in the right way to actually make government more open and transparent?

Perhaps even more challenging: how do we explain it to people in a way that helps them know where they fit?

Now, the pieces are falling into place.

We know that at the heart of the open, transparent government we seek is ‘open’ government data that is available online and in real-time.

Government information should be as accessible to us as information about the weather, sports scores or knowing what’s going on in the stock market — and we need it to be this way so we can both hold government accountable and create new enterprise with what is made available to us.

In order to reach our vision of an open government – or an online, real-time government – we also know there are a number of “things” that must occur – and not just occur once, but continue to happen over time and continuously reinforce each other along the way.

This “Cycle of Transparency” demonstrates, in one image, the specific actions and the variety of actors that need to work together to create the open, transparent government we seek. We hope this graphic can be a useful tool in thinking about how to make city, state, federal, and even international governments more transparent.

Each type of actor and action complements the others in the Cycle to make every other element easier, or even possible at all. Of great importance is that just about anyone – from hardcore Internet developers to academics to government staff to reporters to activists – has a place in it.

One of the first places we often start in talking about transparency is in the crafting of policies that require the release of data from government. While no one piece of this Cycle is “first” or more important than others, the legislative component is a useful starting point. (Mostly because it’s the first one we wrote down.)

Lawmakers, lobbyists and think tanks (as well as citizens) all play a role in articulating new transparency policies and pushing them through the twists and turns of government processes. Those policies must adhere to core principles of openness, such as making sure government data is “raw,” that it is complete, or that it is searchable (in total, there are nine of these openness principles that government data should adhere to).

These principles aren’t things that government is accustomed to just yet, so the advocacy process is pretty difficult, and the subsequent “gap” between writing new legislation and actually getting legislation passed is more like a “chasm.”

One of the beautiful aspects of open government, however, is that while laws are written (and should be passed) to require the release of government data, Congress, federal agencies, states and cities can – in most cases – become more open and transparent without new laws.

Sidenote: A great example of “enacting without law” is that no law has been passed requiring all federal legislation to be available online for 72 hours before it is debated by Congress. Yet in 2009, Congress showed again and again that it could post bills online for three days before debate without the law requiring that action. Similarly, the “Open Government Directive,” released in a memo by the White House, has made all kinds of new government data available without laws to require it. (Though, it would be ideal if Congress codified the Directive into law to give it a lasting impact.)

Once data is released, government agencies (such as the Department of Energy or Transportation) and web developers anywhere can build the necessary technology to organize the data and make it usable. Federal repositories like Data.gov or Sunlight’s National Data Catalog are great examples of this type of public/private foundation building.

In the way of analogy, one way to think about this entire process is that it turns government into a type of public data wholesaler through which the public can build retail outlets.

With data being made easily accessible, journalists and bloggers can begin to dig into it, mix it up, identify relevant information and give the data context. As that critical context is provided, citizens absorb it and spread the information to others – both online and face-to-face – and make the data actionable.

Ultimately, informed citizen action creates greater public awareness; citizens become more effective, responsible advocates; holding government accountable becomes informed by data rather than inside-the-Beltway pundits, and better decisions can be made for our democracy.

As each element of the Cycle of Transparency moves forward concurrently, bringing about the changes we need to create a more transparent government, we also identify new needs.

At the end of the day, the process that the Cycle of Transparency describes is about creating a government more deserving of our trust, and ultimately, a government that allows its citizens to fully participate and hold government accountable as our Founders intended.

Open Congress: House Votes to Cancel Haiti's Debt

Donny Shaw — 2010-03-10T19:41:00+00:00

On voice vote, the House of Representatives this afternoon passed a bill that would put pressure on the big international financial institutions to completely cancel all of Haiti’s debt so that the country can use what resources it has for rebuilding from the earthquake they suffered in January, 2009.

The bill is H.R. 4573, sponsored by Rep. Maxine Waters [D, CA-35] and co-sponsored by 69 other lawmakers, mostly Democrats. According to the official title, it would “direct the Secretary of the Treasury to instruct the United States Executive Directors at the International Monetary Fund, the World Bank, the Inter-American Development Bank, and other multilateral development institutions to use the voice, vote, and influence of the United States to cancel immediately and completely Haiti’s debts to such institutions.”

Haiti is to poorest country in the Western Hemisphere. Their entire GDP is around $8.5 billion, and according to the text of the bill, they “owe a total of $709 million in debts to multilateral financial institutions, including $447 million to the Inter-American Development Bank, $165 million to the IMF, $39 million to the World Bank, and $58 million to the International Fund for Agricultural Development.” That’s a total of $1.4 billion.

Besides canceling that debt, the bill passed today calls on international financial institutions to “provide additional assistance … to Haiti in the form of grants so that Haiti does not accumulate additional debts.” And it calls on the U.S. Treasury Department to work on influencing other creditors to cancel any debt Haiti holds with them, like $167 million they owe to Venezuela and the $92 million they owe to Taiwan that the IMF reported in 2008.

The Senate passed a similar bill (S. 2961) on March 5th by unanimous consent. The two bills will have to be reconcilied, or one of the chambers will have to sign off on the other chamber’s version, before it can be signed into law by President Obama.

Image used under a Creative Commons license from AIDG.

Sunlight Foundation: Links at Noon

Paul Blumenthal — 2010-03-10T17:32:33+00:00

1) Roll Call prints a classic headline: “Earmark Advocates Skeptical of Ban.” Who would have thought that?

2) Bailed-out firms are getting back in the lobbying game.

3) Rep. Jeff Flake is asking the House Ethics Committee why they didn’t interview anyone in their investigation into PMA Group earmarks that led to exoneration for all involved lawmakers.

4) We won’t have Ralph Reed to kick around again.

Open Congress: Congress Links

Eric Naing — 2010-03-10T16:28:00+00:00

While you wait for the Congressional Budget Office to score the revised health care plan, take a took at today’s roundup of interesting blog posts and articles:

The left is starting to turn on liberal stalwart Rep. Dennis Kucinich [D, OH-10] over his opposition to the Democratic health care reform package. Kucinich, who doesn’t believe the reform plan goes far enough, has promised to vote against it even if he is the deciding vote in the House. (Salon)
This surprisingly gripping account of a failed bid to develop tankers for the Air Force explains a lot about how Washington works. (Politico)
In a meeting with reporters today, Senate Majority Leader Harry Reid [D, NV] promised to look at ways to reform the filibuster next year. Reid had previously opposed such reforms saying that 67 votes in the Senate were needed. (Ezra Klein)
Health and Human Services Secretary Kathleen Sebelius continues to go after the health insurance industry. (The Washington Independent)
The tale of former Rep. Eric Massa [D, NY-29] grows even more sordid. (The Atlantic)
The Onion highlights a few overlooked alternative health care proposals floating around Congress. (The Onion)

Open Congress: Senate Approves Extension Of UI, COBRA Benefits Through 2010

Eric Naing — 2010-03-10T15:46:00+00:00

The Senate has just passed a $140 billion bill includes an extension for unemployment benefits through the end of the year, tax credits and billions in emergency aid to states.

One week after approving a 30-day extension of unemployment benefits (H.R.4691), the Senate today passed the American Workers, State, and Business Relief Act (H.R.4321), which provides a longer-term extension of those benefits. Specifically, the bill extends federal unemployment assistance through Dec. 31 and provides a 65 percent subsidy for COBRA health insurance premiums. The coverage is retroactive to Feb. 28.

Other provisions in the bill include:

A seven-month delay in Medicare cuts to doctors costing $7billion

$25 billion in federal dollars to help states prevent layoffs of public employees like teachers and police officers

$26 billion in tax credits to encourage things like research and development and alternative energy

The measure passed in a 62-36 vote, with six Republicans joining almost every Democrats in voting “yes.” The Senate voted 66-33 earlier today to break a Republican filibuster of the bill.

To compensate for part of the $140 billion price tag, the bill closes the “black liquor” tax credit for paper companies and further cracks down on tax shelters. These revenue-generating measure may spell trouble when the bill goes back to the House for approval as both of these ideas have already been incorporated into President Obama’ s health care plan.

For more information, check out my previous post on the subject here.

Sunshine Review: Sunshine Review presents most transparent websites with a Sunny Award

2010-03-10T15:22:03+00:00

The Best State and Local Government Websites For Transparency Recognized
Sunshine Review Names 39 “Sunny Award” Winners

Alexandria, VA—The best state and local government websites in America for transparency today received a “Sunny Award” from Sunshine Review, a pro transparency organization.

Award winners are among only 39 websites in America earning an “A” transparency grade from more than 5,000 analyzed. Sunshine Review’s “Transparency Checklist” analyzes websites for information about budgets, meetings, elected and administrative officials, permits and zoning, audits, contracts, lobbying, public records, and taxes. The “Checklist” measures what content is available on government websites against what should be provided.

“Sunny Award winners deserve recognition for making information available to citizens and for setting a transparency standard that all governments can, and should, meet,” said Mike Barnhart, President of Sunshine Review. “Access to information empowers every citizen to hold government officials accountable for the conduct of the public’s business and the spending of taxpayers’ money. Official accountability is the corner stone of self government and liberty.”

Sunshine Review is a non-profit organization dedicated to state and local government transparency. The Sunshine Review wiki collects and shares transparency information and uses a 10-point “Transparency Checklist” to evaluate the content of every state and more than 5,000 local government websites. Sunshine Review collaborates with individuals and organizations throughout America in the cause of an informed citizenry and an accountable government.

Since its inception in 2008, Sunshine Review has analyzed the websites of all 50 states, more than 3,140 counties, 805 cities, and 1,560 school districts.

Sunlight Labs: Quantifying Data Quality

2010-03-10T14:46:28+00:00

You've already heard me complain about data quality -- how it's a bigger problem than most people realize, and a harder problem than many people hope. But let's not leave it there! Perfect datasets mostly exist in textbooks and computer simulations. We need to figure out what we can do with what we have. In this and other posts, I hope to give the developers in our community some idea of how they can deal with less-than-perfect data.

The first step is to figure out how bad things actually are. To do that, we'll use some simple statistics -- those of you with a strong stat background can skip to the next entry in your RSS reader (or better yet, correct my mistakes in comments).

The GAO provides a good example of how to tackle this kind of problem. They were asked to examine government spending on the nonprofit sector -- a process that ultimately led to this report (PDF). As you might imagine, there are a number of ways that federal dollars make their way to nonprofits, from loan guarantees to tax breaks to medicare payments to nonprofit hospitals. For the most part, each of these is tracked through a distinct system.

Let's confine our work to one of the systems that GAO examined: the Federal Award and Assistance Data System, or FAADS. Along with FPDS, this makes up one half of the data powering USASpending.gov. FAADS tracks grant payments (and some other things that we'll ignore for now). Let's just examine that question: how do we figure out how much federal grant money went to nonprofits?

First we should define the subset of FAADS that deals with the nonprofit sector. If we can do that, and there aren't any other problems, then we should be able to just sum up the records and figure out the totals. There's a fairly obvious way to do this: FAADS records have a "recipient type" multiple-choice field, and one of the possible values is "nonprofit". But of course it's not actually that simple: the full name for the value is "other nonprofit". The field's possible values also include "private higher education". If you take a quick look at some records with that value, you'll see that many of those educational institutions are nonprofits. Worse, a look at the "nonprofit" category shows some suspicious entries. It's worth taking a closer look at the reliability of the values entered into this field.

But we need to get beyond saying the data is "pretty good" or "kind of dodgy" or "really bad". It would be useful to come up with a quantified estimate of how reliable the field is. GAO did this by picking a random sample of records, then checking each one to see whether it was correctly classified. That gave them a precise answer about how good the classification was within the sample -- but what does the quality of the sample tell us about the quality of the larger dataset? To figure this out, GAO calculated the confidence interval of their result.

The idea is pretty simple. Let's say there's a big population out there, and you want to quantify some attribute of it. Unfortunately, it's not practical to examine that value for every member the population. Instead, you'll take a smaller sample of the population, finding the value of the attribute just for its members. How close will that value be to the real value you'd get if you did examine the entire population? It's impossible to say for sure, but thanks to the magic of the Central Limit Theorem, we can look at how erratic the sample's values are and get an estimate of just how good it is at representing the larger population.

You've probably run into confidence intervals before when reading about political polls. "Politician A has a 50% favorability rating, +/- 3 points!" This means that the pollsters are 95% confident that the real favorability rating -- the one they'd get if they asked every relevant person -- is between 47% and 53%. Why are they 95% sure of this, instead of 90% or 99%? Well, 95% is a natural number to use thanks to the properties of the normal distribution, but in truth it's a bit arbitrary -- it's just sort of the stat-industry standard (interestingly, this means that one out of every twenty statistically significant results will be specious, even if the experimenters made no mistakes -- something to keep in mind the next time you read a breathless account of some amazing just-published scientific discovery).

As you might imagine, for a given population there are a few factors that can be tweaked when evaluating the confidence interval: sample size, confidence level, and the width of the confidence interval. As already mentioned, that second term is generally held constant at 95%; but tradeoffs are often made between the other two. You can get a more precise confidence interval by increasing your sample size, for example -- but that usually costs time or money.

But let's get back to the nonprofit problem. The GAO took a random sample of records from the "nonprofit" category and a random sample of all the other records in FAADS. They then turned to whatever supplementary sources they could lay their hands on to figure out if the listed recipient for each record was actually a nonprofit -- they used the IRS Business Master File, the Census of Governments, the Higher Education Directory, and various other subject-specific guides to the nonprofits present within specific economic sectors.

There were three possible results to each examination for a recipient's true nonprofit status: it could be a nonprofit, or not a nonprofit, or the investigation could be inconclusive. After examining the samples, they had a percentage value attached to each of these outcomes, which represented each outcome's share of the sample.

Each of those values can then plugged into this formula:

Where p is the true share of the population that falls within the category (e.g. "is a nonprofit" or "uncertain"), n is the size of the sample, and the p with a hat (called "p-hat", pleasantly enough) is the observed proportion of the sample falling in the category.

Simple! There are a number of assumptions underlying this which hide the statistical machinery: the assumption of equivalence between the standard deviation of the population and that of the sample; the fact that we're after a 95% confidence level. But this is a pretty standard way of going about it, and it seems to be how GAO approached the problem. For the nonprofit category, they reported a confidence interval of (.60-.79), meaning that about 70% of the sample turned out to represent genuine nonprofits, and based upon this they could be 95% sure that the true proportion of nonprofits in the larger population fell between 60% and 79%. They did the same thing with educational institutions, testing how many were nonprofits, and found an interval of (.88-.98).

(Some of you might have noticed that this operation can work backwards: some simple algebra reveals that GAO investigated 89 records in order to get these figures. In fact, the report says that they examined 96. This discrepancy is no doubt partly the result of rounding errors, but it's also probably somewhat attributable to their use of a t distribution, a technique invented at the Guinness Brewery in 1908 to help make reliable predictions even when the sample size is pretty small. It's not worth getting into the specifics here, but the upshot is that we need to adjust that 1.96 value for low values of n.)

So what can we do with this knowledge? It's tempting to say, "Okay, we have a statistically justified range for how many of these records are correctly classified as nonprofits. Let's take the total dollars for that category, multiply it by the high and low end of the confidence interval, and get an estimated range for total grant spending going to nonprofits."

I wouldn't say this is a bad idea, exactly. Certainly this gets you closer to the truth than simply taking FAADS at its word. You ought to add in the weighted sum for the educational institution category too, of course. And you should probably do the same thing for all the other recipient categories, to see how many nonprofits have been miscoded into those buckets. And it would be a good idea to account for that "unknown" category, too -- the records that might or might not be nonprofits.

But even then, we're in dangerous territory if we assume we have an answer. Much of what you read about statistics will be prefaced with "for a random variable" -- when we can't satisfy that assumption, things kind of fall apart. For instance: what if the government is in the habit of giving differently-sized grants to nonprofit recipients versus other recipients? That's something we should test for before we just blindly weight the sum of all grants. Worse: what if we're missing some records from the population? None of the above calculation tells us anything about anything other than the data we have in hand.

In the end, GAO didn't pursue these lines of inquiry. Testing the nonprofit classification left things close enough for government work, as they say. Still, by examining the quality of that classification, GAO peeled back and refined one assumption, and in the process, arrived at a better estimate. Not a perfect one -- there are still a number of assumptions being made here, and they're worth examining, too. But they did get an estimate of how useful one aspect of their data was, and that's a very good thing to know.

Open Congress: Financial Reform Bill Will Exempt Payday Loans

Donny Shaw — 2010-03-10T14:24:00+00:00

Some of the most absurd lending and borrowing happens in the payday loan industry. According to the Center for Responsible Lending (.pdf), the average payday loan borrower pays $800 for each $325 they borrow. That’s an absolutely absurd interest rate, but according to the New York Times, the senators who are designing financial reform legislation are going to include a special carve-out so the industry can keep on dealing in these abusive loans:

Under the proposal agreed to by Mr. Dodd and Mr. Corker, the new consumer agency could write rules for nonbank financial companies like payday lenders. It could enforce such rules against nonbank mortgage companies, mainly loan originators or servicers, but it would have to petition a body of regulators for authority over payday lenders and other nonbank financial companies.

Consumer advocates said that writing rules without the inherent power to enforce them would leave the agency toothless.

I’d say that’s pretty much the definition of toothless. They can make the rules, but they can’t enforce them.

The House version of financial reform legislation (H.R. 4173) contained no such carve-out — payday lenders, and other nonbank financial companies, like pawn shops, would be subject to the same consumer protection regulations as other businesses in the financial sector.

Why are these most usurious of lenders getting away so easily in financial reform legislation? Two reasons:

1) They are the only companies that will lend to people with bad credit histories. Since they hold peoples’ assets and future income as collateral, credit scores don’t matter to them. Without the service they provide, some people would have virtually no way of getting emergency loans.

2) They have been lobbying hard. Last Spring, the AP reported that the payday load industry has “deployed well-connected lobbyists and hefty sums of campaign cash to key lawmakers to save themselves”:

The payday lending industry’s trade association has spent more than $1 million annually for each of the last four years lobbying Congress, including $1.4 million last year, according to disclosures filed with Congress. It has beefed up its team of Washington hired guns to a dozen, including well-connected financial services lobbyists Tim Rupli and Wright Andrews, who each have firms bearing their names.

It also has stepped up its campaign giving in recent years, forming a political action committee that contributed more than $200,000 in 2007 and 2008, much of that to lawmakers who serve on the Senate Banking and House Financial Services committees, according to Federal Election Commission filings compiled by the Center for Responsive Politics. Those committees have jurisdiction over the industry.

Individual payday lending companies including Cash America Inc. and Advance America Cash Advance, have also stepped up their political activities.

“As the Hill has become more interested in our industry, we have stepped up our efforts,” in Washington said Steven Schlein of the Community Financial Services Association, the trade group for payday lenders.

“Congress is beginning to realize that there aren’t other alternatives,” to payday lending, Schlein said.

A newer player representing Internet payday lenders — a growing segment of the market — also ramped up its lobbying and political giving efforts. The Online Lenders Alliance, formed in 2005, nearly quintupled, to $480,000, its lobbying expenditures from 2007 and 2008. It contributed $108,400 to candidates in advance of the 2008 elections compared to about $2,000 in the 2006 contests. Gutierrez was among the top House recipients, getting $4,600, while the top Senate recipient was Sen. Tim Johnson, D-S.D., a Banking Committee member who got $6,900.

The group has also helped host several fundraisers for lawmakers with say over what happens to the industry, according to invitations collected by the Sunlight Foundation, which tracks political parties. Those included a fundraiser last year for Rep. Joe Baca, D-Calif., a Financial Services committee member. Dinner and a reception at the fundraiser at a Capitol Hill townhouse cost at least $1,000.

Image from Thomas Hawk used under a Creative Commons license.

Open Congress: Airport Funding Bill Grounded By Union Issue

Eric Naing — 2010-03-10T12:40:00+00:00

A measure that would provide billions to fund the Federal Aviation Administration and modernize airport infrastructure is being held up over a provision that would allow FedEx workers to unionize as easily as UPS workers.

The House last summer passed the FAA Reauthorization Act (H.R.915) that, among several things, would reauthorize funding for the FAA, provide $70 billion for airport infrastructure and update pilot training standards. The most controversial part the bill, however, is a provision that would make it easier for some FedEx employees to unionize.

Since FedEx was founded as an airline, its workers are governed by the 1926 Railway Labor Act, which as Business Week explains, “carries a difficult path to unionization that requires a national vote by every worker at a company, and doesn’t allow for organizing at a local, terminal-by-terminal level.” UPS workers, and most private sectors workers in general, are governed by the National Labor Relations Act, which presents workers with fewer obstacles should they want to form a union.

UPS, the Teamsters and other labor organizations support the provision but FedEx is pulling out all the stops to prevent it from becoming law. As part of a multi-million dollar campaign, FedEx is falsely claiming that the unionization provision amounts to an unfair government “bailout” of UPS. Regardless of how one feels about labor, the facts of the debate show that FedEx just doesn’t want their workers to have the same ability to unionize as employees at UPS and most private sector companies throughout the nation do.

A Senate version of the FAA Reauthorization Act (S.1451) has been stalled for months over this issue and it doesn’t even include the unionization provision.

Leading the charge against the bill in the Senate is the delegation from Tennessee: Sen. Bob Corker [R, TN] and Sen. Lamar Alexander [R, TN]. FedEx is headquartered in Tennessee and has been a major donor to both senators.

Corker and Alexander have placed a hold on the bill to ensure that the unionization provision is not included when the House and Senate bills are reconciled.

The FAA was last reauthorized in 2003 and a series of temporary extension measures have kept the agency from shutting down since then. Should this measure become law, funding for the agency would be secure until 2012.

Open Congress: Democrats Announce Corporate Earmarking Ban

Donny Shaw — 2010-03-10T12:07:00+00:00

The long-standing congressional tradition of directing federal money to corporations in your state or district, often in exchange for campaign contributions, may be coming to an end. Well, at least in appropriations bills. Reuters reports:

Lawmakers in the U.S. House of Representatives will no longer be able to direct funds toward for-profit companies through the earmarking process, the House Appropriations Committee said on Wednesday.

The committee said it also would set up a special process to allow businesses to pitch their ideas directly to the Defense Department, which accounts for a large share of federal spending.

The ban won’t apply to universities and non-profit institutions. It also won’t apply to items in bills that aren’t technically appropriations earmarks, but function in much of the same way. For example, the narrowly-targeted items that were included in the Wall St. bailout bill, like the repeal of a tax on wooden arrows, or the porky items from the stimulus bill, woudn’t be banned. And unlike the earmarks in appropriations bills, which are subject to strict disclosure rules, it’s almost impossible to figure out who sponsored or is benefiting from the earmark-like items in non-appropriations bills.

Image used under CC license from johnmuk.