News tagged as 'Amy Handlin'

Crony Capitalists at Solyndra Lose Half a Billion Dollars of Taxpayers’ Money


Crony Capitalism has been a problem in America since Alexander Hamilton’s unsuccessful attempt to promote the Society for the Establishment of Useful Manufactures in the 1790s. The first really big Crony Capitalism scandal exploded in the 1860s and 1870s, when the Pacific Railway Act sponsored by a Republican Congress and signed by a Republican President enabled a scoundrel by the name of Thomas C. Durant to steal about $23 million from the $56 million the Federal Government loaned the Union Pacific Railroad. 

Durant’s scheme was simple. He controlled Union Pacific, the recipient of federal largesse, and also controlled a company called Credit Mobilier, the contracting firm Union Pacific hired to actually build the railroad that extended from Council Bluffs, Iowa to Promontory Point, Utah. Credit Mobilier simply dramatically overcharged Union Pacific for its services, then paid outrageous dividends to its shareholders. It was, of course, a mere coincidence that Durant had been a business client of the attorney who became the Republican President who signed the Pacific Railway Act — Abraham Lincoln.

Fast forward to 2011, where another politically connected operator who reportedly donated over $100,000 to the various Obama campaigns and entitites, just blew through half a billion dollars of Federally Guaranteed loans. David Keene has written a great article describing this Solyndra debacle.

Instead of getting out of the business of picking winners and losers–an economic policy that is clearly unconstitutional–the Obama Administration is doubling down. It’s giving away even more money to politically connected donors who support Obama’s left wing policies.

In light of this continued trend, it’s good to see that the Voices of the Tea Party will be offering a new e-book on another aspect of Crony Capitalism that’s just as bad as the federally subsidized Solyndra fiascos. I speak here of local and state Crony Capitalism, a topic that New Jersey Assembly Member Amy Handlin addresses in her new e-book, Crony Capitalists in Our Backyards, which we will release in October. Handlin specifically describes a set of actions local grassroots organizations can undertake to stop these practices, which makes her e-book especially interesting for those of us in the Tea Party movement who like to fix problems once they’ve been identified.

UPDATE: September 8, 2011

Now comes a report this morning that the FBI raided Solyndra’s offices this morning and that the company’s founders have visited the Obama White House 20 times in the past two years!

Michael Patrick Leahy is the editor of the Voices of the Tea Party e-book series and co-founder of Top Conservatives on Twitter and the Nationwide Tea Party Coalition. His new  e-book, I, Light Bulb: A Death Row Testimonial, was published earlier this week. His new book, Covenant of Liberty: The Ideological Origins of the Tea Party Movement, will be published by Broadside Books in spring, 2012. He can be reached on Twitter at @michaelpleahy .

Bloat in the Shadows


As activists around America gear up for the 2012 presidential race, there is a risk we’ll lose sight of problems closer to home. This would be an expensive mistake. Bloated local government already threatens our wallets and our freedoms; in the absence of citizen pushback, it is sure to get worse.

One illustration of what we’re up against: the burgeoning number and power of so-called “special districts,” quasi-public agencies that borrow and spend billions of tax dollars with minimal oversight or accountability. The most familiar are school districts, but these bodies also include authorities, boards, commissions and public corporations in charge of thousands of facilities like airports, highways, bridges, dams, hospitals, sewer plants and housing complexes. While created for all sorts of high-minded reasons, special districts are typically run by unelected and well-connected bureaucrats who take their cues from political patrons. They enable local governments to circumvent debt restrictions, evade responsibility for unpopular projects, increase tax rates, threaten private property rights and — last but never least — steer contracts to crony capitalists. This murky landscape of money and power is often dubbed “shadow government.”

If its expansion continues unchecked, we will see more of shadow government’s trademark outcomes: stratospheric spending, corruption and irresponsible hiring. Here are a few examples:

The Massachusetts Bay Transit Authority was the lead agency for Boston’s infamous Big Dig urban roadway project. Its $14 billion price tag broke records, while its shoddy standards and lack of oversight cost lives.

The Philadelphia Housing Authority spent $17,000 on a party, including a troupe of belly dancers, while unsanitary conditions nearly killed a public housing resident. Its executive director allegedly diverted $500,000 from agency funds to settle a sexual harrassment lawsuit. At the Buffalo, New York Municipal Housing Authority, a top administrator offered to pad contracts for builders willing to do private work on the side.

The New London, Connecticut Development Corporation condemned 115 private properties to promote new condominiums and other “improvements” in an aging neighborhood. When the U.S. Supreme Court upheld the land grab, Justice Sandra Day O’Connor dissented: “Nothing is to prevent the state from replacing any Motel 6 with a Ritz Carlton, any home with a shopping mall, or any farm with a factory.”

If you want to work for a special district, your campaign activities will often trump your competence. At two of New Jersey’s major sewer authorities, commissioners openly hired on the basis of political affiliations. At West Virginia’s Parkway, Economic Development and Tourism Authority, over 35 members of the same family got jobs in one department.

The bottom line: It is easy for the denizens of shadow government to make bad and self-serving decisions when they know no one is paying attention. They believe Tea Party activists are too distracted by federal issues to care. You can prove them wrong.

Amy Handlin is Associate Professor of Marketing at Monmouth University and Deputy Minority Leader of the Republican Party in the New Jersey General Assembly

Crony Capitalists in Our Backyards


I propose writing an e-book for the Voices of the Tea Party series on the perils of crony capitalists in our backyards. As Deputy Minority Leader of the New Jersey General Assembly, I’ve seen this crowd at work. It’s not a pretty sight.

They are purveyors of junk…sweetheart deal-makers…and lobbyists for bigger government. Crony capitalists make a living not by selling the best products, but by cultivating political patrons who steer them contracts with no competition. They ingratiate themselves with their enablers by writing outsize campaign checks — and by drawing more golddiggers into the game.

Their influence is bad enough on Capitol Hill, where it led directly to massive corporate bailouts and billions in “stimulus” spending. But crony capitalists are right in our backyards, buying influence and trading favors at every statehouse and city hall in America. Because the quality of their work is often irrelevant, they produce trash and chicanery like unsafe schools, contaminated food, leaking tunnels and bad financial advice. At the extreme, their substandard services can kill: Insider-vendors constructed the Boston tunnel where a 38-year-old driver was crushed under a collapsing roof.

Here are a few more examples:

Local politicians with authority over the Los Angeles Community College District hired campaign contributors for a seven-year, multi-billion dollar expansion project. Among the cracked floors and crooked steps, the new buildings featured heating and cooling units installed upside down and wet wood that had to be torn out. In Florida’s Broward County, favored vendors built mold- and mildew-ridden schools. In New Jersey, after auto emission testing was farmed out to politically-connected consultants, the system was plagued by malfunctioning equipment, unreliable gas detection, incorrect analysis — and long lines of furious motorists. Two New Mexico state pension and trust funds lost $90 million on investments recommended by advisers who made five-figure donations to then-Governor Bill Richardson.

Big-government liberals, who love to expand public facilities and payrolls, are natural partners for crony capitalists. But so are crooks. When millions of dollars change hands with minimal oversight, shady operators inevitably find ways to siphon off part of the take. No one knows the total cost of this thievery, but one estimate puts it at $1 billion — in just a single state. The so-called “corruption tax” not only adds to local tax burdens, but also hurts honest businesspeople who need a level playing field to compete.

As a decentralized but nationwide movement, the Tea Party is perfectly positioned to stop the crony capitalists in our backyards. One community at a time, citizens can expose hometown deals and hold elected enablers to account. But first, more people need to understand that the problem is insidious, omnipresent and corrosive to our way of life. An e-book could sound the alarm and explain how to fight back. It could point citizens toward hard evidence of crony capitalism, like no-bid contracts and conflicts of interest. Importantly, it could also identify potential allies to broaden the attack.

I believe that a battle against crony capitalism is more than a political imperative: It offers a powerful recruitment tool. Many who share the Tea Party’s goals won’t give up their time for an abstraction, no matter how worthy. But this issue is personal. It hits people where they live, undermining economic opportunity and making a mockery of local democracy.

Amy Handlin is Associate Professor of Marketing at Monmouth University and Deputy Minority Leader of the Republican Party in the New Jersey General Assembly