Hillary Comes to Hollywood for Money-Raising Shindigs

Hillary arrives in Hollywood today, to raise more than $2.5 million. Money and power mesh like peanut butter and jelly in Washington, Wall Street and Hollywood. The path toward influence is lined with the casualties or victories of status, wealth, and ego. Two presidential elections ago, Hollywood created its own underdog when it poured backing into the coffers of Barack Obama, shunning Hillary Clinton. But Hollywood loves a good comeback story in politics or on the silver screen. Enter Democratic presidential hopeful, Hillary and Hollywood money, Part II.

On May 7^th, three private fundraisers kick off the first of many legs of Hillary Clinton’s 2016 election Hollywood campaign. First, there is a breakfast reception at the Westwood home of Public Affairs consultant, Catherine Unger. Then comes a luncheon at the Pacific Palisades abode of Steven and Dayna Bochco. (Steven Bochco Productions contributed $373,000 to Democrats over the last four campaign cycles.) The main evening event takes place at the Beverly Park estate of Chairman and CEO of Saban Capital Group, Haim Saban, and his wife, Cheryl. The couple and the Saban family foundation are listed in the $10-$25 million bracket of the Clinton Foundation contributors. The crème-de-la-crème of Tinsel town will clank their glasses for their ‘Champion’ of inequality far above the inequality rampaging the City of Angels.

Co-hosting will be an assortment of legacy media heavy hitters including the Sabans, Casey Wasserman, a trustee of the William J. Clinton Foundation, and Jeffrey Katzenberg. Event tickets are $2700, the maximum individual limit for primary period contributions. This would put Hillary Clinton’s May 7^th Hollywood haul at about $2.6 million. More important than these initial outlays though, is their promise of solidarity. Hollywood stands ready for Hillary.

Indeed, Hollywood is expected to unite for a chance to spend money on Clinton’s campaign, in contrast to its prior loyalty abscess, which accelerated into cacophonous Barack Obama support early in the 2008 election cycle. The question is – will it spend as much? That answer will depend on the GOP and whether the rest of the Democratic field opens up, as with Senator Bernie Sanders’ April 29^th declaration that he would run for president as a Democrat.

The Bigwig: Jeffrey Katzenberg

According to the Washington-based non-partisan, non-profit research group, Center for Responsive Politics, DreamWorks Animation CEO Jeffrey Katzenberg reigns supreme over Hollywood glitterati in terms of most consistent and varied monetary support for the Democratic Party and its anointed ones.

Most people think of political contributions in terms of individual or aggregated corporate donations. That’s just the tips of the iceberg. Money flows into Capitol Hill in many forms. These include donating directly to candidates and bundling (or tapping all your rich friends and associates to contribute under your name before handing over a mega check). More ways to fork over dough consist of contributing to political action committees (PACs) or super PACs that do the same thing once removed, and ‘other’ avenues like paying $50K a pop to attend the Inaugural Ball, something stars such as Halle Berry, Sharon Stone, Neil Diamond and Jamie Foxx did for Obama’s 2009 victory gala.

Katzenberg was the top Hollywood bundler for Barack Obama’s 2012 campaign. Last year, shifting gears back to prep for the 2016 election, he co-hosted a fundraiser featuring Hillary Clinton that raised $2.1 million for the Democrats.

Hillary's Money and Social Circles

Hillary has been comfortable in these sorts of circles for decades, even before the days when Barbra Streisand serenaded her husband, former President Bill Clinton during his 1996 re-election bid, ensuring enthusiastic media coverage in the process. Then, A-listers like David Geffen and Steven Spielberg corralled Hollywood’s elite to pay up to $12,500 a piece to convene in an opulent Mediterranean-style manor, netting the Democratic Party around $3.5 million. Geffen also hosted intimate dinners, in which President Clinton and a dozen power-guests, such as Steve Jobs, Steve Tisch, and Lew Wasserman, former MCA studio chairman would mingle.

Hillary’s own fortune pales in comparison to some of these players. On a relative scale, she is more like the 99 percent to the 1 percent bracket of the Hollywood billionaires, but at those echelons, such distinctions get blurred in lieu of power.

Her wealth still places her well into the 1/10th of 1 percent territory relative to the rest of the American population. In 2012, Hillary Clinton, as Secretary of State, ranked the third richest person in the executive branch, with a net worth of approximately $15.3 million. Her successor, John Kerry sits comfortably in first place with a net worth of $103 million as of 2013. (Obama ranks 8^th wealthiest with $4.6 million.)

Obama’s Bundlers

Hillary Clinton is hoping to surpass the total of Obama’s contribution figures, including from Hollywood. In 2008, Obama and Senator John McCain posted bundlers by ranges, with the top ranges designated "$500,000 or more." Together, 536 elites directed at least $75.75 million to McCain, and 558 directed at least $76.25 million to Obama. Jeffrey Katzenberg topped Obama’s 2008 bundler list. David Geffen from DreamWorks SKG was also in the $500,000 category.

Money flowed more plentifully for Obama’s 2012 re-election bid against Republican candidate, Mitt Romney, in the most expensive presidential campaign in US history. Again, the distinction between the wealthiest and everyone else was pronounced.

The top 100 individual donors to super PACs (plus their spouses) represented 1.0 percent of all individual donors to super PACs, but raised 67 percent of the super PAC (or ‘Outside Group’) money. All told, 769 elites handed $186.5 million to Obama's re-election efforts or the DNC. The TV/Movies/Music industry coughed up $12.1 million, not quite Wall Street’s levels of $22.85 million, but still commendable.

Jeffrey Katzenberg, who led Obama’s bundler group in general, with a total of $2.12 million to him or the Democrats from 1990-2012, was again in the $500,000 bucket, alongside Barry and Wendy Meyer of Warner Brothers, Colleen Bell of Bell-Phillip TV Productions, Mai Lassiter and Will Smith and Jada Pinkett-Smith of Overbrook Entertainment, and John Emerson from Capital Group Companies.

Katzenberg ranked 18^th in the 2012 composite list across industries of Top Individuals Funding Outside Spending Groups with $3.15 million. Other Hollywood A-listers on that list included Director Steven Spielberg (who ranks in the $1-$5 million contributors group for the Clinton Foundation  with $1.1 million, Actor Morgan Freeman with $1 million, Comedian Bill Maher with $1 million, Haim Saban with $1.16 million, and billionaire Jerold A. Perenchio, CEO of Chartwell Partners with $4.1 million.

By early 2015, DreamWorks Animation announced cuts of 500 employees as part of its “strategic” plan to restructure its feature film business. It's a safe bet that those 500 former employees will not be attending many elite political festivities in Beverly Hills. Jeffrey and Marilyn Katzenberg dropped to 97th of the 100 top individual contributors for 2014, with $793,000. Hillary Clinton may provide grounds for a leap.

Hillary’s Celebrity and Celebrities

If it were up to Twitter and Facebook, Hillary would be running the White House already. She has more Twitter followers and Facebook likes than any Republican candidate that has already announced a bid for the Oval Office, plus Jeb Bush. She scores about 3.46 million Twitter followers and 2.1 million total Facebook likes.

On the GOP side, Ted Cruz tops the social media list with about 844,000 Twitter followers and also about 2.1 million Facebook likes. Rand Paul has 651,000 Twitter followers and 1.9 million Facebook likes. Marco Rubio has 732,000 Twitter followers and 1.1 million Facebook likes. Jeb Bush lags the GOP social media race with just 183,000 Twitter followers and 172,000 Facebook likes.

Aside from Hollywood’s legacy political-donor leaders and established celebrities like Ellen DeGeneres, Hillary is attracting a new more youthful demographic to her side. Lena Dunham offered Twitter support, but no funds as of yet. Kimberly Kardashian West donated $15,000 to the DNC last fall, under her company Kimsa Princess, Inc. and may come out publicly to support Hilary Clinton. America Ferrera backed Clinton in 2008 and will again. Olivia Wilde endorsed her. So did Scandal’s Kerry Washington and singer, Ariana Grande.

In 2008, after raising $229.4 million (about one-tenth the amount her camp claims she will raise this time), Clinton left the 2008 presidential race in early June. Of her top dozen corporate donor sources, Wall Street came through for her over Hollywood. JPM Chase, Goldman Sachs, Citigroup, Morgan Stanley, Lehman Brothers and Merrill Lynch all placed above 21^st Century Fox at 12th place.

According to a customized analysis for Forbes by the Center for Responsive Politics, only 12 people made both Hillary Clinton’s and Barack Obama’s top 50 Hollywood contributors list. And though the majority of those donors gave to both Clinton and Obama, only four of them ranked in both Clinton’s and Obama’s top 20. Those were Jeffrey and Marilyn Katzenberg, Steven Spielberg and Clarence Avant, CEO of Interior Music Corp. It will be Clinton’s hope to raise that crossover rate.

In politics, business and media, bruised egos heal quickly when money is concerned. Big Hollywood players will still back the Democratic candidate they think will win. That’s how the game of money, politics and social status works. The smaller ones will follow.

This piece originally appeared in Forbes on May 4th. 

Let’s talk about Hillary Clinton and the Historical Record

On March 10th, after eight days of anticipation, media and political uproar, the world fell privy to Hillary Clinton “breaking her silence” (aside from the stray tweet beforehand) regarding her decision to conduct government business from her personal clintonmail.com email address while Secretary of State - for ‘convenience’ purposes.

There are basically two opinion camps that have formed around email-gate. They break down, as these things too often do, across partisan lines. The GOP camp professes, absent any self-reflection of say, the 22 million lost-then-found emails deleted from a non-government domain during the George W. Bush administration, that this is another example of the Clintonian belief that laws and words are mere obstacles subject to manipulation.

The second, largely progressive Democrat camp believes that Hillary Clinton is being harpooned unfairly over this oh-so-minor issue in the scheme of matters of much greater gravitas. Hey, what is ‘is’ anyway? And what’s wrong with convenience – after all, two phones are so heavy and cumbersome?

But the historical record has an opinion, too. The capture of history is predicated on the preservation of information, preferably as much information as possible. Regarding American Presidential records, sometimes that information remains classified for “national security” or other reasons, or only released after decades of dormancy once said threat is deemed gone.

Other times, it will be made available to the public once it has been processed by archivists, neatly divided into folders and boxes and marked under official category names and numbers. It is then either accessed quickly (as the Oprah interview was at the Clinton library) or awaits years to be requested by a wayward historian. (This was the case for many of the items I was fortunate to unearth through my own recent presidential records analysis.)

When I was probing presidential archives throughout the country for All the Presidents' Bankers, classified, and then unclassified, information included items like former Chase head, David Rockefeller and Henry Kissinger’s melding of private banking and state department activities leading to the Iran Hostage Crisis during the Carter administration. Still classified information included pages of redactions in the George H W Bush archives regarding his son, Neil Bush’s role in the late 1980s Silverado S&L scandal. 

But even though I focused on the relationships and related policy decisions of presidents with key bankers, history pushed every Secretary of State associated with the 19 presidents I investigated to the surface as well. Their actions happened to intersect with those of the presidents and bankers; domestic and foreign policies thereby intertwined throughout the years in a detectable, and often repetitive, pattern. If those Secretaries of State had taken it upon themselves to divvy up and classify their own correspondence trails, the truth behind their actions, associations, and motivations would have been similarly diffused.

For the most part, before the advent of emails, presidential documents resided in the form of typed letters, handwritten notes, telegrams, and taped recordings (until after Nixon’s presidency). From Teddy Roosevelt through Ronald Reagan, the documents I examined were pre-email technology, as were the George HW Bush documents I was able to view.

As I reached the William J. Clinton Library in Little Rock, Arkansas, on a blustery mid-January day in 2013, fewer documents of any kind were available for my requested inspection compared to the prior presidential archives I had visited. First, because they had not been processed yet. Fewer historians and researchers are requesting information and fewer staffers work at these libraries (the money is made at the museum part of the libraries from busloads of tourists, not from those of us digging through the archives.) Second, the advent of emails and the masses of extra correspondence they produce, means that more procedures and protocol are harnessed to determine what can be released to the public, or whether these Automated Records Management System (ARMS) emails, as they are called, will remain hidden under the cloak of  ‘national security.’

The FOIA requests on bankers that I submitted to the Reagan Library for as yet uncategorized, but not classified information were processed within a few months. I have yet to hear back from the FOIA’s on bankers that I submitted to the Clinton Library in January 2013.

By using external email addresses and servers, Hillary Clinton didn’t just rob the records process of its ability to evaluate and categorize information; she robbed the public and even future public servants of the chance to examine her communications for analysis or relevant decision-making. Hillary Clinton chose to self-segregate her correspondence. She asserted she was not violating any rules or seeking to hide her communications in the process. Yet, rules were violated whether she sought to hide anything or not.

Before reporters at the UN, Clinton admitted that, "Looking back, it would've been better if I had simply used a second email account and carried a second phone but at the time this didn't seem like an issue…The vast majority (italics mine) of my work emails went to government employees at their government addresses which meant they were captured and preserved immediately on the system at the State Department."

She took “unprecedented steps” to make “all work-related emails public."  Yet, these steps weren’t hers to take.

According to White House Press Secretary Josh Earnest, President Obama had corresponded with Clinton via her private email address, “But”, Earnest said, “the president was not aware of the fact that this was a personal email server and that this was the email address that she was using exclusively for all her business."

It’s hard to imagine President Obama wasn’t aware that 'clintonmail.com' didn’t look like 'state.gov.' But if he had not been too busy to notice such minor discrepancies, he might have wondered whether or not she was using this email address for all of her business, government or otherwise. At some point, during her years working for him, he might have asked her to come on over to the state.gov side. But, he didn’t. Perhaps it served neither of them to have done so.

Yet, the Presidential Records Act of 1978, that President Obama himself amended, as did President George W. Bush, to give the White House more latitude in determining security issues for disclosures, is very clear in its definitions regarding what consitutes necessary information.

First, consider that on the White House’s website, under Executive Branch, it states:

“The power of the Executive Branch is vested in the President of the United States, who also acts as head of state and Commander-in-Chief of the armed forces. The President is responsible for implementing and enforcing the laws written by Congress and, to that end, appoints the heads of the federal agencies, including the Cabinet.” (Bold is mine.)

Then, under the heading Department of State, we see confirmation that:

“The Secretary of State serves as the President's top foreign policy adviser.”

Now, reading the definition of “Presidential Records”, from the National Archives website as per the Presidential Records Act of 1978 (44 U.S.C. Chapter 22), we see that:

"Presidential records" means documentary materials…created or received by the President, the President’s immediate staff, or a unit or individual of the Executive Office of the President whose function is to advise or assist the President, in the course of conducting activities which relate to or have an effect upon the carrying out of the constitutional, statutory, or other official or ceremonial duties of the President. “

True, these documentary materials don’t include “personal records” (such as yoga classes or wedding plans) or those “of a purely private or nonpublic character which do not relate to or have an effect upon the carrying out of the constitutional, statutory, or other official or ceremonial duties of the President.“

But equally, records are only considered "personal" if they are “not prepared or utilized for, or circulated or communicated in the course of, transacting Government business.” 

This was clearly not the case with Hillary Clinton's emails that did just that. The act also does not exclude government business conducted on a personal email, regardless of whether associated emails were incoming to, or outgoing from the President and captured in that manner. Therefore, conducting any government business on a personal email is a technical violation of the act.

According to Hillary Clinton, all government business related emails have been reverted to the State Department. Whether that is true or not is a conclusion she has robbed history of the ability to make. In other words, she didn't just exercise shady judgment for the sake of convenience, she disrespected American history and its rules for preserving information on behalf of journalists, academics, historians and the American and global public. 

Power Inequality Dwarfs Income Inequality

This piece originially appeared on Truthdig.

There’s been a lot of discussion about the historically high levels of income and wealth inequality lately—mostly from people on the shorter end of that stick—with good reason: There’s no end in sight.

In his new book, “Capital in the Twenty-First Century,” economist Thomas Piketty argues that worsening inequality is inevitable in a mature capitalist system, based on his analysis of 200 years of data. But inequality isn’t just an evolving condition like a crippling allergy that comes and goes, or just grows, enumerated by horrifying statistics. Nor is it just the result of a capitalist-utopian idea of free markets in which everyone gets a fair shot armed with equal information (which simply don’t exist in the real world, where markets are routinely gamed by the biggest players).

Inequality is endemic to the core structure of an America that operates more as a plutocracy than a democracy. It is an inherent result of the consolidation of a substantial amount of both financial power and political influence in the hands of a few families.

In my upcoming book, “All the Presidents’ Bankers,” I trace the lineage of the banking and political families and their associates who have had the most combined influence on American policy. Inequality of income or wealth is a byproduct of the predisposition and genealogy of this coterie of America’s power elite. True, being born into wealth means having a greater chance of accumulating more of it—but take it a step further. Expanding on the adage of “it takes money to make money,” we get a much better idea of why inequality is so rampant: Because aside from income and wealth issues, it takes power to keep power.

By nature of the construct and self-reinforcing behavior of a small circle of American families and their enterprises—particularly over the past century since financial capitalism replaced productive capitalism as the means to expand power, wealth and influence—a comparative handful of families and their connections run Wall Street and Washington collectively. They run America as two sides of one political-financial coin, not as divided factions but as co-influencers of policy through public and private office.

There have been times during the past century when the specific individuals commanding this joint effort paid credence to the public interest, or were imbued with more humility. During those times, levels of inequality happened to decrease. At other times, the power elite solely promoted private gain, as from WWI through the crash of 1929, and since the 1970s, particularly since the 2008 crisis. At those times,  inequality happened to grow. This is not to imply that the moods of the elite were the sole arbiters of the direction of inequality, but that whatever the direction of these levels, general economic health is more dependent on the actions of this long-term, tightknit and concentrated few than on the ideal of a democracy. In this environment of such power inequality, economic inequality is unavoidable—and unsolvable.

Today, the focus of this power structure is so skewed that any notion of “public good” is mere campaign fodder for presidents or presidential hopefuls, and nonexistent for the banking elite. That’s why inequality for the rest of the population has leapt back up to 1928 levels and will continue to rise from there. That’s why Jeb Bush or Hillary Clinton or both may run for president, while JPMorgan Chase, J.P. Morgan’s legacy, remains the most powerful bank in the world, as it was designed to be more than a century ago.

In the Economic Policy Institute’s February 2014 report “The Increasingly Unequal States of America,” authors Estelle Sommeiller and Mark Price chronicle income inequality on a state-by-state basis from 1917 to 2011. Starting in 1979 until 2011, as the average income of the bottom 99 percent of U.S. taxpayers rose by 18.9 percent, the average income of the top 1 percent rose by 10 times more, or 200.5 percent. Conversely, between 1928 and 1979, the share of income held by the top 1 percent fell in every state but one.

More recently, their results show that between 2009 and 2011, not only did income inequality grow in all 50 states, but all income growth went to the top 1 percent in 26 states. New York and Connecticut led the pack in terms of income inequality by virtue of their disproportionate share of financial industry millionaires and billionaires, whose fortunes were in turn bolstered by federal and Fed policies that championed the banks that had first access to cheap money and a place to dump their toxic assets. In these states, the average income gap in 2011 had the top 1 percent making 40 times more than the bottom 99 percent. (The gap in California was 26.8 times, confirming that on average Wall Street money trumps tech and entertainment money. The smallest average gap was in Hawaii at 12.1 times.)

Not only are current income inequality levels near the 1928 peak, but the systemic risk posed by this inequality is worse now. There is no counterbalance to the banking elite who possess no imbedded public spirit underlying their political influence and command more instruments of leverage capital than ever before. There’s no strong labor force, no large swaths of the population demanding reform by any means necessary, no revolution. Instead, we have an overhang of debt, stagnant wages and inferior jobs, all exacerbating income inequality.

Risk inequality means that those who have less to begin with have more to lose in adverse circumstances, whereas those with more have less to lose. This extra inequality dynamic is as dangerous to individuals as it is to the greater economy. It is particularly damaging in the wake of the epic Wall Street bailouts and ongoing zero-interest rate monetary policy and quantitative easing of the Federal Reserve policy, which helps the same banks whose family legacies worked with the Washington leaders who were their friends to create the Fed to back their bets and preserve their wealth a century ago.

Inequality has been given nothing but pithy lip service by the political-financial elite, elected or selected, or those aspiring to more of it. Last fall, Hillary Clinton was paid $400,000 to tell two Goldman Sachs gatherings that the financial crisis was a shared responsibility, implying that Wall Street had been unfairly demonized in its wake.

The Economic Policy Institute report authors conclude, “In the next decade, something must give. Either Americans must accept that the American dream of widespread mobility is dead or new policies must emerge that will restore broadly shared prosperity.” But the cards have already been dealt—and the verdict is in. Not only will the American dream remain dead, but also income and wealth and risk inequality will escalate by virtue of the government-supported consolidation of banking family and firm power.