Tag Archives: John McClaughry

Disclaimer over here, boss?

Recently, an opinion piece by the doughty and redoubtable John McClaughry made the rounds. It appeared in some newspaper op-ed pages, and in the Commentary column of VTDigger.

And it involved a significant, undisclosed, conflict of interest.

McClaughry’s missive was a big sloppy wet kiss on the feet of Charles Koch, one of the infamous Koch brothers. McClaughry regurgitated a few nuggets of wisdom from Koch’s recent book, Good Profit. The book is a self-serving explication of why the Koch brothers are fine, principled businessmen with a strong focus on customer service and an aversion to big gummint.

Except when they can profit from it, of course. Curiously, one Kochbit highlighted by McClaughry concerns Koch Industries’ production of ethanol, which is almost entirely a creation of government subsidy. McClaughry writes with evident approval:

… out of principle, Koch opposes the present government mandate to blend ethanol into gasoline as a political scheme that produces “bad profit.”

Which has not prevented Koch Industries from continuing to enrich itself with this alleged “bad profit.” But somehow McClaughry overlooks the evident hypocrisy and praises Koch for a principle he never acts upon.

But I digress. The point isn’t that McClaughry has blessed the world with a few hundred words of free-market rhetoric, but that his own conflict of interest was not disclosed by VTDigger.

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Tha Regan Dinnur

Looky here, the Vermont Republicans have another spectacular evening to warn tell us about. It’s the Reagan Dinner — pardon me, THE REAGAN DINNER all caps, with a photo of a noble Ronnie posing manfully in front of an American flag. It’s hosted by the Chittenden County GOP, and it’s all happening on March 10, getcha tickets early!

As usual, the Republicans are being stingy with the details — probably because it’s going to be the usual “excitement” of rubber chicken, cash bar and canned speeches.

Yup: Cocktails, dinner, and an “Energy Forum,” Lord help us all. Doesn’t look like they’ll have any high-profile out-of-state guests; the dinner is being artfully held the week following the Vermont primary, so I’m sure we won’t get any presidential candidates on the dais.

But all I want to know is, can the Chittenden County GOP afford a little copy-editing? Because the official announcement says the event will be at the “Cattamount Golf Club.”

Geez, how many Vermonters are unaware that “Catamount” is a one-T animal? That’s as bad as “Six Teats.”

But wait, there’s more!Take a gander at the list of special guests.

Special Guests include Bruce Liseman, Randy Brock, John McClaughry, Rob Roper

Yup, “Liseman.” Poor ol’ Bruce just can’t get any respect from the party, can he?

After the jump: Screenshot of the announcement, typos and all. 

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Climate incoherence, stage right

Very sorry to have missed Thursday’s carbon tax debate, featuring the Good Guys (Paul Burns of VPIRG and UVM’s Jon Erickson) against the Death Star Duo, Rob Roper and John McClaughry of the Ethan Allen Institute.

Oh yes, fair and balanced shall I be.

I’m sure the DSD walked away believing they’d won, because they are dyed-in-the-wool true believers whose outlook is hermetically sealed against the intrusion of actual evidence. Also, lest we forget, they’ve received hundreds of thousands of dollars from out-of-state conservative donors with ties to the Koch brothers.

The really striking thing about their presentation was the difference between Messrs. McClaughry and Roper. McClaughry is an out-and-out denier. Roper acknowledges climate change but says there’s nothing we can do about it, so we shouldn’t even try.

Yeesh.

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Climate change follies

You’ve got to hand it to David Sunderland, chair of the VTGOP. When he gets hold of a notion, he just doesn’t let go. No matter how stupid the notion may be.

Today’s exhibit: Not content with a series of inflammatory press releases against the carbon tax, which is not on the Legislature’s agenda, nor will it be anytime soon, Sunderland has launched a new website aimed specifically at the carbon tax. Which is not on the agenda, nor will it be anytime soon.

But brave Dave won’t let the facts get in his way on this, any more than the scientific consensus on climate change has penetrated his brain. The website depicts a doomsday scenario for Vermont, and the Demcrats as the evil villains plotting the state’s demise.

Well, as Hillary Clinton told one of the House Benghazi Committee bozos, “I’m sorry that it doesn’t fit your narrative. I can only tell you what the facts were.”

Turning the page… more developments on the Climate Change Debate saga.

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The hardest working man in the charity racket

This isn’t new news, but a correspondent has alerted me to some amusing details regarding the Ethan Allen Institute, a.k.a. the Vermont outlet of the American Legislative Exchange Council (ALEC). Specifically, EAI’s required annual filing with the IRS for 2014.

EAI, for those blessedly unaware, produces modest quantities of free-market puffery. And it proudly states as a matter of sacred principle, right there in its IRS Form 990-EZ, “We don’t receive — nor would we accept — government funding or support.”

Which is true except for EAI’s tax-deductible status, which is definitely a tangible form of government support.

Now, you might be dismayed at the thought of your tax dollars effectively underwriting EAI’s “educational activities,” but you can take some comfort in knowing how hard those guys are working for your money. Because according to page 2 of its filing, EAI President Rob Roper is working an average of 80 hours per week. His salary: a paltry $50,000.

On an hourly basis, the poor guy’s making less than Bernie Sanders minimum wage!

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Ethan Allen Institute: Follow the Money

Back on March 25, the Senate Natural Resources and Energy Committee held a public hearing on S.R.7, the “climate change resolution.” The only witness who stood in opposition was Vermont’s favorite crank, John McClaughry, founder and former President (now Vice President) of the Ethan Allen Institute.

You're being watched, Mr. McClaughry.

You’re being watched, Mr. McClaughry.

During his testimony, he said S.R.7 was part of a campaign by national climate advocacy groups “to put the skeptics on the defensive” and serve as a fundraising tool. By passing this resolution, he said, the Legislature would act as a “pawn” of those national groups.

Okay, well, since he brought up the idea of a national campaign and national organizations influencing Vermont politics, resolution sponsor Sen. Brian Campion asked him about the Ethan Allen Inistitute’s ties to the Koch brothers and their national network. McClaughry acknowledged a $50,000 grant from the Cato Institute “six years ago,” and he noted Cato’s ties to the Kochs. But otherwise?

I have never been aware that we got any money from the Koch Brothers or the Koch Foundation or Koch Industries, anything like that. And I’ve never had communication from any of those people urging me to, or urging our organization to fight against the climate change advocates. Never.

He went on to deny receiving funds from the State Policy Network, an umbrella organization with strong ties to the Kochs. SPN provides guidance and funding to free-market “think tanks” in each of the 50 states.

There’s a small problem and a big problem with McClaughry’s professions of independence.

The small problem: According to IRS filings, SPN gave EAI $24,930 in 2013.

I’ve been told, second-hand, that McClaughry later wrote to Campion apologizing for his misstatement. If I find out more about that, I’ll let you know.

That kinda-sorta takes care of the small problem. But it fails to address the big problem, which is:

Between 1998 and 2013, EAI received at least $572,260 from out-of-state donors with ties to the Koch brothers’ sprawling network of right-wing foundations. This network is designed to limit public disclosure and provide tax breaks for “charitable donations” that promote the political interests of wealthy conservatives. The network is also designed to give donors plausible deniability by laundering their donations while still giving them control over how their money is used.

Over the past ten years, EAI’s annual revenues have fluctuated between $132,000 and $201,000. So $572,280 is a whole lot of money by EAI standards.

My figures come from Conservative Transparency, a database that ” tracks the flow of money among conservative donors, advocacy groups, political committees, and candidates.”

It’s likely that EAI has received even more money from national conservative organizations, but legal disclosure standards are woefully weak. From the Conservative Transparency website:

Although most nonprofit organizations are required by law to report their outgoing grants to the Internal Revenue Service, they do not have to disclose the sources of their funding. As a result, the transactions in Conservative Transparency are based on information reported by the donors and exclude “dark money” raised by the recipients from unknown donors that are not in the database. The totals in each recipient’s “financial record” are based on a review of the recipient’s publicly available tax documents filed with the IRS.

CT lists 36 donations to EAI from out-of-state conservative groups between 1998 and 2013 (the most recent year for which filings are available), totaling $572,280. A lot of that money came, indirectly, from the Kochs, their organizations, and their fellow members of this broad conservative network.

These donations came from a handful of national foundations, all with strong alliances to the Kochs and their nonprofit empire. This network is designed to provide an appearance of independence, but there’s no doubt that the Ethan Allen Institute is in the Kochs’ orbit.

Here’s a list of EAI benefactors, with dollar figures from Conservative Transparency and descriptions from Sourcewatch.org.

Donors Capital Fund: $298,500. DCF and a related entity, DonorsTrust, “create separate accounts for individual donors, and the donors then recommend disbursements from the accounts to different non-profits. They cloak the identity of the original mystery donors because the funds are then distributed in the name of DT or DCF.

“The Koch brothers and other ultra-wealthy industrial ideologues appear to be cloaking an untold amount of their donations to conservative political outlets through DT and DCF.” One of Charles Koch’s big funds has given “only to Donors Capital Fund since 2005.”

The modus operandi of DCF provides plausible deniability to EAI and other recipients; they can assert with a straight face that they don’t get money from the Kochs. But they do benefit from the largesse of a money-laundering operation created by, and generously funded by, the Kochs.

The Roe Foundation: $95,000. Private foundation started by the late Thomas Roe, former chairman of the State Policy Network, a key cog in the Koch machine. (See below.) His foundation “continues to provide financial support to free-market policy groups across the country.”

The Jaquelin Hume Foundation. $63,000. The Foundation “‘supports free-market solutions to education reform’ and funds many conservative and libertarian organizations.” It has strong ties to the American Legislative Exchange Council (ALEC) and the State Policy Network.

The Cato Institute: $50,000. A “libertarian think tank founded by Charles Koch and funded by the Koch brothers.” Over the years, “the Koch family has donated more than $30 million to the organization.”

The State Policy Network. $24,930. SPN “has franchised, funded, and fostered… a web of right-wing ‘think tanks’ in every state across the country. It is an $83 million right-wing empire as of the 2011 funding documents from SPN itself and each of its state ‘think tank’ members.” SPN had its origins in the 1980s, but dramatically stepped up its activities in 1998.

“Fueled by robust funding from right-wing funders including the Koch brothers… SPN has grown rapidly in recent years. There were 12 original think tanks when SPN was founded. In 2013, there were 64 SPN member think tanks in all 50 states.”

Although SPN insists its members are “fiercely independent,” The New Yorker’s Jane Mayer has reported that SPN head Tracie Sharp “compared the organization’s model to that of IKEA.” Like IKEA, SPN “would provide the raw materials along with the services needed to assemble the products. …’Pick what you need,’ she said, ‘and customize it for what works best for you.’

“…  Sharp ‘also acknowledged privately that the organization’s often anonymous donors frequently shape the agenda. ‘The grants are driven by donor intent’ ..  [and] often ‘the donors have a very specific idea of what they want to happen.'”

The Chase Foundation of Virginia. $24,830. “the private foundation of investor Derwood Chase.” It gave nearly $900,000 to right-wing groups in 2011 alone. Its beneficiaries have included many of SPN’s state-based organizations.

The JM Foundation. $15,000. According to its own website, it was created by Jeremiah Milbank, who “was an ardent believer in individual liberty, limited government, and free markets.” It lists its top activity as “supporting education and research that fosters market-based policy solutions, especially at state think tanks.” Like, for instance, the Ethan Allen Institute and its SPN cohorts.

That’s it. The Ethan Allen Institute may be able to deny knowingly receiving money from the Kochs, but there’s no doubt that it is significantly dependent on out-of-state “foundations” with very strong Koch ties, and with Koch dollars providing much of their lifeblood.

Last time I wrote about EAI, I mentioned a Tweet that accused me of lying about its ties to the Kochs. I expect I’ll get an apology about the time Hell freezes over.

Let’s go to the 990

Okay, so I spent part of Monday (maybe five, ten minutes all told) in a slow-motion Tweetchat with the fine folks at the Ethan Allen Institute. At one point, whoever Tweets on behalf of EAI accused me of lying about its connection with the Koch empire. And I pointed out that it wasn’t a lie, just a mistake.

Then came the following exchange:

Dunno what they mean by “solution” there, but the whole Tweet is kind of inartful. Anyway, @EAIVT asked if I had consulted its IRS Form 990, the annual filing required of nonprofit organizations.

Well, I hadn’t checked the 990 because I knew it was irrelevant to my assertion. Nonprofits aren’t required to disclose revenue sources, so nothing in EAI’s form would prove or disprove any Koch connection.

But hey, I’m open to suggestion, so I found EAI’s latest 990 — for tax year 2013 — as posted by the journalistic nonprofit ProPublica. (Where you can find the last several years’ worth, in fact.)

And as I thought, there’s no information about where the money comes from. But there are some interesting numbers to be found, and here’s a sampling.

In 2013, EAI took in $140,690 in “contributions, gifts, grants and similar amounts received,” plus another $60,000 in membership dues. Add in a bit here and there, and EAI revenue was $201,018.

Not bad, not bad. There’s no further information about the sources of that $201, 018, nothing to prove or disprove any financial dependence on the Kochs or the State Policy Network or other out-of-state corporate interests.

Unfortunately, EAI was a deficit spender in 2013. It racked up expenses of $224,290. Fortunately, it began the year with a positive balance of $43,021, so it ended the year in the black.

Yay!

On to Part III, “Statement of Program Service Accomplishments,” a.k.a. EAI’s nonprofit fig leaf. The IRS requires a list of the organization’s three primary programs. Here’s the EAI list:

— $72,200 for “Two daily radio programs on WDEV Radio Vermont.” This includes John McClaughry’s Daily Diatribe (I think that’s what they call it); and the hour-long “Common Sense Radio,” which causes massive tuneout at the end of the Mark Johnson Show every weekday at 11.

Well, now we know why the folks at WDEV put up with that drivel. They are well paid to put up with that drivel. And they get a better deal than we do; thanks to EAI’s tax-exempt status, we are all paying, indirectly, for the glories of “Common Sense Radio.”

— $44,205 for something called the Energy Education Project, which “promotes intelligent energy choices in Vermont through a daily blog, a website and educational events.” Gee, I’d never heard of this endeavor before. So I searched for “Energy Education Project Vermont,” and there it was.

However, it hasn’t been updated in a very long time. The top item on its homepage is entitled “Entergy Announces That Vermont Yankee Will Close in October 2014.” Checking the Google, I see that Entergy made that announcement in August of 2013.

Pretty sad, for EAI’s number-two Service Accomplishment.

— $47,000 for a variety of programs, not a single entry. These include the montlhly Ethan Allen Letter; a series of opinion pieces offered gratis to Vermont media outlets; “public meetings and educational seminars”; and a transparency website jointly maintained with the Public Assets Institute. Now there’s an odd couple.

On to Part IV, a list of officers and key employees. Oh boy, salary disclosure!

EAI President Rob Roper pulled down $50,000 last year, slightly under Vermont’s median income. Hey look, he’s middle class!

Vice President John McClaughry made $24,000 and his wife Anne made $18,000 as Secretary/Treasurer, plus another $5500 combined for “Health benefits, contributions to employee benefit plans, and deferred compensation.”

Bill Sayre, member of the Board of Directors, made $9600, presumably for hosting Common Sense Radio. None of the other directors (Wendy Wilton, Jack McMullen, Catherine Clark, John Cueman, Milt Eaton) was paid.

Finally, the caboose on EAI’s very short gravy train is occupied by Shayne Spence, who was paid $6000 to serve as “Outreach Coordinator.” I don’t know whether this includes the compensation he received as a Koch Summer Fellow in 2013, but that’s a thing that exists.

I’ll skip over several boring pages, which brings me to Schedule A, Part III, which lists total “Public Support” for the five preceding years. During that time, EAI took in a total of $784,910. The totals for 2009 through 2013 go:

$151,775; $155,225; $171,565; $105,345; and $201,000.

Don’t know what happened in 2012, but there you are. In addition to the “public support,” EAI has made a few hundred bucks every year from “interest, dividends” and other non-donor sources.

Well, that was fun. It did nothing to illuminate the sources of EAI’s money or to settle the question of whether it has financial ties to the State Policy Network and other Koch- and Koch-like operations, or whether its ties are purely ideological.

Too bad, as I wrote earlier: we really need more transparency in the nonprofit world. If EAI could show that it really is a home-grown organization that gets the bulk of its financing from Vermonters, that would lend it some credibility.