On Wednesday August 5th, the first Federal action to emerge from the recent FBI raids on Reading’s City Hall was announced. The President of Reading’s City Council pled guilty to bribery charges related to campaign finance irregularities and a scheme designed to change the city’s current campaign finance reforms.
If you read the government’s guilty plea memorandum with Council President Franciso Acosta two things are striking: the small amount of money involved in the actual transaction and the fact that campaign finance restrictions on the amount donors can give directly are actually changing the game in cities that institute them.
At the very least, it may lead to additional legal actions against public officials named anonymously as public official #1 and public official #2. It is clear that public official #1 refers to Reading Mayor Vaughan D. Spencer, but the identity of public official #2 is not yet known.
Reading is at the edge of the Philadelphia region, in Berks County. It is a city whose population hit its high mark in 1930 (at 111,000) and has largely trended downward since then, with small recent upticks. Around 88,000 people live there now. It is a majority Latino city with one of the highest rates of poverty in America.
Governor Wolf would be wise to start talking about state corruption, particularly at a time when he is battling Republicans over the budget. The majority of residents still favor many of his budget priorities. This is a good time for him to deliver a message about government integrity.
One would have hoped that the Mayor and City Council President had other concerns than doing a favor for a donor who wanted a contract, as outlined in the guilty plea. With a 38 percent poverty rate and only about 8 percent of adults with a college degree, there is work to do and none of that important work was apparent in the Federal plea document.
This is the first of the legal actions that emerged, at least indirectly, from the Rob McCord investigation, which resulted in a guilty plea from the former Treasurer. Lots of people in Reading, Harrisburg, Allentown, and Philadelphia are wondering what other shoes will drop. Who wore wires? When did they wear the wires? How will this affect the political landscape?
In Allentown, a recent City Council meeting was filled with angry residents calling for resignations. Mayor Pawlowski has not been charged and he very may well not be guilty of anything but a cloud hangs over his head and his political career, at least for the near future.
But the really big news is that State Attorney General Kathleen Kane was indicted on Thursday, August 6th, disrupting Pennsylvania politics in a whole new way.
Officials will take sides on whether she should step down or not. Allies of Kane will attack Montgomery County DA, Risa Vetri Ferman and call it a partisan attack (Ferman is a Republican). The Philadelphia D.A.’s office is quietly shouting for joy. They have been odds with Kane for more than a year.
To his credit, Governor Wolf called for her to resign, citing her inability to do her job while she is mounting a defense. His resignation call was not framed as a guilty sentence but as a practical consideration. This will make it easier for other Democrats to join the chorus.
That contrasts well with statements a few months back from former Governor Rendell who urged her to stay on even if she is indicted.
Governor Wolf would be wise to start talking about state corruption in general and getting ahead of the multiple stories on the public radar, particularly at a time when he is battling Republicans over the budget. The majority of residents still favor many (not all) of his budget priorities. This is a good time for him to deliver a message about government integrity.
The charges are actually a reflection of Kane’s temperament. She seems to have viewed the office as a platform for small grievances and paybacks. Kathleen Kane is still young. She needs to walk away and re-start her career.
After all, if you are asking for major increases in spending, the question of how money is spent and under what kind of influence is no minor issue. Look for some state Republicans (who have their own significant and not so proud history of Pennsylvania corruption) to talk about indictments as a natural by-product of government growth and hubris. That is why Wolf needs to make an affirmative case.
Can Kathleen Kane hold on even after an indictment? In 1995 indicted Pennsylvania Attorney General Ernie Preate resigned but only after he copped a plea, which resulted in a one-year jail sentence. Preate, a Republican, was eventually succeeded by Tom Corbett, who returned to that office several years later and then rode the office to a one term Governorship.
An interesting comparison is the Attorney General in Texas, Republican Ken Paxton, who rode into office as a Tea Party backed candidate, and was just indicted on securities fraud but as of yet he has not stepped down.
The charges against Paxton pre-date his AG tenure unlike the presumed charges against Kane. Governing Magazine recently discussed a number of present and former AGs in legal trouble.
The unraveling of Kathleen Kane and the guilty plea by Rob McCord represent the demise of two promising stars in State-wide Democratic politics. How will it effect other rising stars in the state? How does it affect the ability of candidates to raise money, particularly in campaign finance reform cities?
It will be interesting to see if this turn of events gives an edge to Joe Sestak in his race against Katie McGinty for the Party’s senate nomination. For the time being, the two candidates will ignore each other and act as if this is just a race against the Republican Senator. But this will not last long.
McGinty is viewed as the candidate of the Party establishment and Sestak as the independent Democrat, eschewed by the establishment. If you are McGinty you would be wise to start speaking about these issues. Otherwise you could end up wearing the establishment badge in what might be a change election. Yes, she is a woman, in a State that has an awful record in sending women to Washington (or Harrisburg for that matter), but that may not be enough of a change message in this election cycle. We will see.
Kane has generated a small cottage industry of conspiracy allegations. She suspects all manner of enemies of trying to take her down but she continues to create enemies by her episodic management style. It is hard to know if you need a chess or Ouija board to predict the next move she will make.
The charges are actually a reflection of her temperament as much as anything. She seems to have viewed the office as a platform for small grievances and paybacks. By focusing on petty issues, she missed an opportunity to do the really important work of the office. Kathleen Kane is still young. She needs to walk away and re-start her career.
The winner in all of this, thus far, is Montco D.A. Ferman who is running for Montgomery County Court judge. Ferman’s performance at the press conference was very strong and I think she comes out of this looking good. Of course we are still early in the story.
Meanwhile switching over to Fattah-land, the Congressman denies all charges and will not step down. He is shrugging off the charges and has vowed to clear his name. As my colleague, Larry Platt has noted, there is nobody in the local political regime urging him to step down or calling for a new candidate. That is a shame. He needs to come to terms with the fact that he is just not that important; that the integrity of the office and the rule of law are more important than his personal story.
Fattah is trying to paint a picture of a vindictive and overzealous US Attorney’s office that has it in not only for him but for his family. The present US Attorney for the Eastern District of Pennsylvania is David Zane Memeger, an Obama appointment. I just do not think Fattah’s camp can go anywhere by intimating that there is a conspiracy or personal vendetta against him. It just does not add up.
One of the interesting subtexts of the Fattah story is the existence of nonprofit political affiliates controlled by the Congressman with no independent governance. A logical question to ask is how was this possible?
Wouldn’t a grantor or a contractor want to see financial statements, verify board members, and perform other types of due diligence? Wouldn’t questions be asked prior to sending large checks to the organizations? Even if the Congressman was able to apply political pressure for an appropriation or a gift, wasn’t there someone on the other end in some agency asking questions? And if there were active board members, what did they know and when did they know it?
Whether they are politically affiliated or not, every nonprofit that I know that has gotten into financial or legal trouble has usually had a governance gap. And the other side of that governance gap is the existence of a key leader, sometimes a founding leader, who has the standing or charisma to manage without checks and balances. Substantive leaders seek out checks and balances, particularly as an organization gets more complex.
This is a problem that is more endemic than we might think. And we would be wise to start paying attention. Otherwise we start to lose our democracy and civil society, one indictment at a time.
