Saturday March 9, 2013, 9:27 am
Craig Holman

Government affairs lobbyist, Public Citizen

'Pay-to-Play' Corruption: Chevron, Campaign Contributions and Government Contracts
Posted: 03/05/2013 4:38 pm

At the height of the 2012 elections, Chevron Corp. gave an unprecedented $2.5 million campaign contribution to the Congressional Leadership Fund (CLF), a super PAC intimately tied to House Speaker John Boehner (R-Ohio) and the congressional campaign committee of the Republican Party. The problem: Chevron Corp. is a government contractor and is prohibited by law from making contributions to federal candidates, parties and committees, including to the new phenomenon of "independent-expenditure-only" super PACs.

Because of a long and seedy record of companies attempting to buy lucrative government contracts through campaign contributions to those who issue the contracts -- or, just as bad, because of government officials extorting money from companies wishing to do business with the government -- federal contractors have been banned from making campaign contributions since 1940. Despite the recent U.S. Supreme Court's Citizens United v. Federal Election Commission (FEC) decision, which allows unlimited corporate expenditures in elections, there is a special provision in campaign finance law for federal contractors, which Citizens United did not affect. Federal law reads unequivocally that contractors shall not make "any such contribution to any political party, committee or candidate for public office or to any person for any political purpose or use."

These laws have been upheld by the courts over and over, starting with the 1995 Blount v. Securities and Exchange Commission (SEC) decision and more recently in the 2010 Green Party of Connecticut v. Garfield decision and the Wagner v. FEC decision last year.

Even CLF, along with nearly all other super PACs, recognizes this law against campaign contributions from federal contractors. The warning on the website of CLF is typical: "Contributions from foreign nationals, Federal government contractors, national banks, or corporations organized by act of Congress are prohibited."

"Pay-to-play" corruption -- the exchange of campaign contributions for government contracts -- is a problem that has swept federal, state and local governments across the nation. To get a picture of how damaging pay-to-play corruption can become, just take a look around.

Sting operations have recorded the all-too-common practice of trading contracts for campaign contributions. Just a few examples include former Govs. Rod Blagojevich in Illinois (now sitting in prison), George Ryan in Illinois (once rumored to be in the running for a Nobel Peace Prize) and John Rowland in Connecticut (sentenced to one year and one day). Just as tellingly, the link between campaign contributors and those who were awarded government contracts under the local administrations of former Mayors Jeremy Harris in Honolulu and John Street in Philadelphia have led to corruption investigations and convictions. The SEC has documented numerous cases of individual investment managers orchestrating campaign contributions in exchange for lucrative contracts to manage hedge funds or pension funds. This is why more than a dozen states and the SEC have passed their own pay-to-play rules banning campaign contributions from government contractors.

In the 2012 elections, a small handful of contractors chose to ignore the pay-to-play law, but none did so with as much bravado as Chevron. Chevron chipped in 22 percent of CLF's entire campaign budget, financing negative attack ads against 14 Democratic House candidates.

Unlike regular PACs that tend to make contributions to a multitude of candidates, frequently even crossing party lines, well over half of super PACs support only a single candidate or party -- essentially serving as a surrogate for a campaign with no limits. Candidates are subject to contribution limits, super PACs are not. The weight of laundering $2.5 million to a lawmaker through his or her so-called "independent" super PAC can carry a lot of sway over whether that lawmaker may intervene to help award a government contract.

Chevron probably was expecting a very different outcome in the 2012 elections. Or perhaps Chevron was expecting the laws on the books not to be enforced. Either way, Chevron established itself as a big money player in politics -- a player willing to spend heavily in elections to further its interests. Lawmakers and officials responsible for awarding government contracts undoubtedly have taken notice.

Public Citizen has asked the FEC to investigate the Chevron campaign contribution and enforce the law to prevent further pay-to-play abuses. If the FEC is not willing to act, lawmakers will be on their own come the next election. The potential for scandal is just another large campaign contribution away.

Since this post was written, Chevron has responded in the media that it does not believe it violated the law because it contributed through a corporation (Chevron Corporation) different from Chevron USA, which has most of the government contracts. Even if that is true, it appears based on SpendingUSA.gov that Chevron Corporation itself had government contracts in 2012, and a contribution would be illegal if any of those was either in force or being negotiated when the contribution was made

Saturday March 9, 2013, 10:23 am
Too much money & power with Chevron & Shell, etc. These companies think they can get away with everything, because money talks. thx

Saturday March 9, 2013, 11:31 am

Shall I hold my breath waiting for that investigation to bring some ripe fruit? I don't really care what Chevron or any other of the many Pay to Play suspects have to say. I would just like to see this play out in a court of law. Funny thing about this, if one of us took funds "under the table" we would be immediately investigated and face most severe charges from both the IRS and the FBI for accepting IGG*, that is what the RICO Laws are all about. One year? Those of us not elected to an office would face 5 to 10 years, and isn't the crime more grave when it also betrays the public trust?

*IGG --- Ill Gotten Gains

Saturday March 9, 2013, 12:02 pm
Please don't Kit. Investigating decay is harder than ripe fruit ready for picking. It's almost as if the constitutional due process rights are becoming exclusive to corporations and those with similar cash flow and not ordinary individuals any longer. I can remember some CA verdict announcements including judges saying public trust betrayals making crimes worse.You cannot currently send a star to Kit because you have done so within the last day.

Saturday March 9, 2013, 12:34 pm
The laws have to be made to stop this Pay-to-Play.I heard President Carter being asked the question if money is having an affect on politics - his response - "It has ruined politics." Makes me wonder why there are even elections anymore, other than the Big Guns get to pick who they want in office. This has become the most serious act of ruination to the country, in my opinion.

Saturday March 9, 2013, 1:13 pm
I read the article and appreciate what they brought here. Lobbyists to congressmen seem endless. Hopefully justice act and dismantle this fraud.

Saturday March 9, 2013, 2:18 pm
Most of the people who get in power only seem to do it through money spent on campaigns and even if that means corruption I dont think there is any honesty in politics now

Noted thanks

Saturday March 9, 2013, 2:32 pm
Noted.

Saturday March 9, 2013, 3:03 pm
Thank you dearly!

Saturday March 9, 2013, 3:58 pm
And these crooks are now advertising on CNN-again. Jail the whole Big oil terrorist group!

Saturday March 9, 2013, 6:38 pm
You are welcome Carol and SuSanne. Some wonderful comments everyone!

Saturday March 9, 2013, 8:30 pm
All this corruption is a terrible betrayal of the pubic.

Saturday March 9, 2013, 9:10 pm
You cannot currently send a star to Carla because you have done so within the last day.

Saturday March 9, 2013, 10:06 pm
Money controls all factions of our government. Too big to fail, to big to prosecute will probably apply in this case, too. Thanks for posting this.

Sunday March 10, 2013, 6:43 am
Thank you

Sunday March 10, 2013, 7:57 am
You are welcome Suheyla

Sunday March 10, 2013, 8:41 am
All things through the courts ... up to the Supreme Court ... for judgement? Another over-extension of power and intrusion (who oversees the overseers once put in place?)

If one entity gets a heads-up, the other side counters, good or bad. Shame on all of us for allowing things to get this far!

Sunday March 10, 2013, 12:09 pm
You cannot currently send a star to Deborah because you have done so within the last day.

Sunday March 10, 2013, 1:37 pm
This is just as good as Gore the you know what getting caught in a Buddhist temple with his hand in the PRC cookie jar. LOL Prosecute the devils.

Sunday March 10, 2013, 1:37 pm
You cannot currently send a star to Michael because you have done so within the last day.

Wednesday March 13, 2013, 9:03 pm
"...Chevron Corp. gave an unprecedented $2.5 million campaign contribution to the Congressional Leadership Fund (CLF), a super PAC intimately tied to House Speaker John Boehner (R-Ohio) and the congressional campaign committee of the Republican Party. The problem: Chevron Corp. is a government contractor and is prohibited by law from making contributions to federal candidates ..."

An investigation, or a whitewash? I don't think I'll hold my breath!

Money buys Congress persons and BIG favours. Money buys power. Power corrupts, and absolute power corrupts absolutely!

Thursday March 14, 2013, 7:10 am
You cannot currently send a star to Lynn because you have done so within the last day.