In most of America, we’ve collectively drawn a line in the sand when it comes to the notion of pay-to-play, the idea of being awarded government contracts for donating to political campaigns. In Philly, though, it’s not quite as simple as that.
“In Philadelphia, the procurement of governmental favor doth not balance upon one’s ability to disseminate gifts or lucre to civic officials.”
Philadelphia is an old city. Our ethics laws about greased palms and political campaigns stretch all the way back to … 2005. (That’s how people talked in 2005, right? It seems so long ago.)
2005 was an interesting year for Philly ethics. In February, federal prosecutors brought to trial former city treasurer Corey Kemp on 46 counts of corruption. His charges ranged from mail fraud to extortion to fake tax returns. In May, he was convicted of twenty-seven of those counts and sentenced to ten years in prison. Kemp was hit the hardest—and to many eyes, was really a low-level fall guy—but 11 others were also swept up in the investigation. Four of them (two bank executives, one fast-food restaurateur from Detroit, and a printer/mistress) were found guilty of various offenses, including lying to grand juries and the FBI.
What the laws don’t address is the more insidious nature of Philly politics, that time-old tradition of trading favors for support, in a way that skirts the pay-to-play laws. Soon-to-be Mayor John Street summed it up this way in 1999: “The people who support me in the general election have a greater chance of getting business from my administration than the people who support Sam Katz.”
The man upon whom this grimy conspiracy circled like a gas station toilet bowl was Ronald A. White—bond lawyer, Democratic fund-raiser, and personal friend of Mayor John Street. Mayor Street wasn’t ultimately implicated in any wrongdoing. But the episode laid out how political pay-to-play works in real time:
White gives money and/or fundraises for Mayor Street.
Mayor Street wins reelection.
Mayor Street instructs his staff (according to federal prosecutors) to give White and his clients city contracts “whenever they appeared to be qualified,” and otherwise provide insider information.
White gets Corey Kemp on the phone when he wants to hear people say things like, “You got your boy in the treasurer’s seat,” or “We take care of each other” (all actual things Kemp said).
When other financial firms send in proposals for city contracts, White gets on the phone and asks them to give money to the mayor. If they refuse, Treasurer Kemp throws their proposals in the trash.
White gets himself wiretapped by the FBI in 22,850 individual conversations.
Federal prosecutors didn’t actually need to go after White at all. He died of cancer before the case could be brought to trial. Corey Kemp and his 27 felonies would have to suffice, then.
Between 2005 and 2010, numerous laws went onto the books attempting to expunge these types of pay-to-play tactics from Philly’s politische Machine:
Chapter 17-1400 of the Philadelphia Code imposed campaign disclosures and donation limits. (Give more than $2,600 to a candidate during a year and you can’t be gifted a contract over $10,000.)
Regulation No. 8 limited “partisan political activity on the part of city officers and employees.” (Are you a city employee who likes get-out-the-vote parties? You’re not anymore.)
Regulation No. 9 created a lobbyist registration to track anyone who tries to “influence legislative or administrative action.” (There’s a historical registration of persons no one seemed to care about. Jews and Muslims? Yes. Lobbyists? Nope. Lobbyists just get no love. Money—they get lots of money, but no love.)
Even with these laws in place, pay-to-play can still elbow its way into our politics. New Jersey sits right alongside Philadelphia when it comes to pay-to-play laws, but in 2013 an engineering firm (Birdsall Services Group) devised a clever way around their state’s $300 campaign donation limit.
Have an employee make a $300 campaign contribution.
Give the employee a “company bonus” of, you guessed it, $300.
Repeat this with 2,285 other employees.
Congratulations, your company just donated $686,000!
There’s an old Benjamin Franklin quote, “Three may keep a Secret, if two of them are dead” (Poor Richard’s Almanack, 1735). There should also be an old Birdsall Services Group quote, “Two thousand two hundred and eighty six people may keep a secret, if two thousand two hundred and eighty five of them are dead.” With so many people involved in the conspiracy, it was only a matter of time before loose lips sank the ship. The Birdsall case was the first to be prosecuted under the 2005 New Jersey pay-to-play statute.
Over the past three mayoral races, campaign donations haven’t made headlines, which leads people to believe that Philly’s pay-to-play laws might actually be holding the line. “There is no point in covering how much money anybody gives anymore,” commented former mayoral candidate Sam Katz “…it is irrelevant. It doesn’t matter. Which says to me the system works.” This is also how I interact with my 2006 Prius. As long as I don’t hear anything fishy, I generally assume everything is A-OK. At least we have a few solid pay-to-play laws on the books should our political races start clinking under the hood.
As encouraging and well-intentioned as measures such as 17-1400 are, the swamp has a way of seeping through any cracks in the system. Greater transparency and cutting the flow of unfettered cash donations is an effective place to start, though.
But what the laws don’t address is the more insidious nature of Philly politics, that time-old tradition of trading favors for support, in a way that skirts the pay-to-play laws. Soon-to-be Mayor John Street summed it up this way in 1999: “The people who support me in the general election have a greater chance of getting business from my administration than the people who support Sam Katz.”
You need only look no further than Councilmanic Prerogative, to understand how this works. Sizeable monetary donations, which are prevented by Chapter 17-1400, can be substituted by all manner of political favoritism. Work with or donate to a councilman’s civic group and he’ll greenlight development projects within his district. Provide benefits to the community in a specific way, or show a willingness to hire certain contractors or union leaders, and you’ll find your bids getting through a whole lot easier. Shun these…philanthropic niceties, let’s say…and you may find an obstinate councilperson blocking your intended expansion of a cancer center. That’s councilmanic prerogative. And it’s entirely legal. In Philadelphia. And a few other bastions of political wholesomeness, like…Chicago.
There is no sure-fire way to purge corruption from our politics. As encouraging and well-intentioned as measures such as 17-1400 are, the swamp has a way of seeping through any cracks in the system. Greater transparency and cutting the flow of unfettered cash donations is an effective place to start, though. As Mayor Street elegantly commented about the city’s corruption tendencies, “Anybody who doesn’t acknowledge that’s the way it works is either a liar or thinks you’re really stupid.” Let’s do what we can to hold to account the liars and the people who think we’re stupid.Header photo by ccPixs.com