DARK MONEY
The secret cash that helped block lead claims in Wisconsin
At age 2, Yasmine Clark was lead-poisoned so severely that she had to be hospitalized for emergency chelation treatment to cleanse her blood of life-threatening levels of the heavy metal.
At age 5, Yasmine was again diagnosed with lead poisoning. She suffered significant brain damage. Her IQ declined. She developed attention deficit hyperactivity disorder.
So, in 2006, at age 5, Yasmine became a plaintiff in a Milwaukee County lawsuit filed against multiple paint companies, including National Lead, now called NL Industries, which had made lead paint like that found in the rental homes where she was raised in Milwaukee.
She was among about 170 Wisconsin children named as plaintiffs in lawsuits against the paint companies. The suits sought compensation for medical expenses and other damages for what their attorneys said were severe and permanent injuries from ingesting lead-tainted paint chips.
While these children had compelling personal stories, NL Industries had something even more powerful on its side: Republican politicians facing recall elections in 2011 and 2012 who secretly benefited from $750,000 contributed by NL’s owner, Harold Simmons, to an “independent” political group.
“It was done because of greed. Politicians chose the interests of their donors and corporate special interest groups over the rights of innocent children.” Peter Earle, Milwaukee attorney who represented a plaintiff in the lead-paint case against Milwaukee paint companies, on politicians who inserted language into a bill halting such cases.
At the request of NL’s lobbyist, Republicans inserted a handful of words into the 2013-15 state budget that sought to halt such lead-paint lawsuits, including the one filed by Yasmine, according to a memo obtained by the Center for Media and Democracy, a left-leaning watchdog organization that exposes corruption in government.
The politicians’ effort — ultimately blocked by judges — demonstrates the power of secret contributions to reshape state law while the public is kept in the dark.
Contributions up, citizens alarmed
The flow of cash to outside groups seeking to influence Wisconsin elections has widened since the U.S. Supreme Court’s 2010 Citizens United decision held that corporations could not be barred from making so-called independent expenditures. The court declared that corporations have the same First Amendment free speech rights as do people.
In 2015, the Wisconsin Supreme Court threw out a state-led John Doe investigation into coordination between Gov. Scott Walker’s campaign, Club for Growth and other “issue ad” groups by overturning a state law that prohibited such coordination. The four conservative members of the court who ordered an end to the investigation had themselves been beneficiaries of an estimated $8 million in outside spending by the same political groups under scrutiny in the Walker investigation.
Later that year, the Wisconsin Legislature passed a law that allows corporations to donate to political parties and legislative campaign committees. The law overturned a corporate contribution ban that had been in place since 1905. Republicans said the change gave corporations parity with labor unions, which could contribute to political parties and which traditionally supported Democrats.
The loosening of Wisconsin’s rules comes as a large majority of the American public is concerned about the influence of money in politics. A nationwide poll released in June by the bipartisan Democracy Project found that 77% of respondents agreed that “the laws enacted by our national government these days mostly reflect what powerful special interests and their lobbyists want.”
Activists, alarmed by the rise of corporate influence on politicians and the electoral process, are fighting back.
United to Amend, a nonpartisan national campaign active in Wisconsin, aims to get local and state governments to endorse changing the U.S. Constitution to counteract the effects of Citizens United. And several states, including Arizona, Colorado, Massachusetts, Missouri, North Dakota and South Dakota, have or are working toward measures on the November ballot that seek to further regulate campaign spending.
Four powerful words
The Guardian news organization, citing leaked documents from the Wisconsin John Doe investigation, found that lead executive Simmons had made donations totaling $750,000 to Wisconsin Club for Growth between April 2011 and January 2012. The spending was used to beat back recall elections against Walker and Republican senators sparked by passage of the controversial Act 10 collective bargaining law.
In 2013, four words were inserted into an omnibus budget motion passed in the early morning hours by the Republican-run Joint Finance Committee.
Those words, “whenever filed or accused,” effectively halted the claims of Yasmine and the other 170 or so leadpoisoned children by retroactively exempting NL Industries and the other lead-paint manufacturers from liability.
In the memo obtained by the Center for Media and Democracy, Senate Majority Leader Scott Fitzgerald, R-Juneau, documented the request by NL lobbyist Eric Petersen to insert the language into the budget.
Attorney Peter Earle, who represented Yasmine in the lead-paint case, said the language inserted into the 2013-15 budget was “obscure and last-minute,” and added “without notice, sponsors or a public hearing.” “It was done because of greed,” the Milwaukee attorney said. “Politicians chose the interests of their donors and corporate special interest groups over the rights of innocent children.”
The secretive budget move was short-lived, however. Milwaukee County Circuit Judge David Hansher found that Yasmine had the right to bring her lawsuit, a decision that was upheld on appeal.
“The sole inquiry before the court is whether it is constitutional for the Legislature to deprive innocent and injured plaintiffs of their vested right to pursue claims against manufacturers and sellers of white lead carbonate,” Hansher wrote. “In this Court’s view, it is not.”
In 2017, Hansher granted a motion filed by Earle to dismiss the case with the option of re-filing it at a later time. Earle said he cannot discuss the reasons for the dismissal.
‘Darkest of dark money states’
Wisconsin and Florida are the only two states in the nation that have legalized coordination between candidates and outside special interest groups that engage in “issue advocacy,” according to Daniel Weiner, senior counsel at New York University’s Brennan Center for Justice, which aims to reform, revitalize and defend democracy and justice.
Contributions to “issue ads,” which often support or oppose candidates without using words including “vote for” or “vote against,” are not required to be reported to the Wisconsin Ethics Commission.
David Buerger, staff counsel at the ethics commission, said the state now bans coordination only involving “express advocacy” — communication that specifically calls for the election or defeat of a candidate.
In a 2015 move that further obscures the influence of money on politics, Wisconsin’s Legislature on a party-line vote eliminated the requirement that candidates list the employers of their donors, removing a key detail behind publicly reported campaign contributions.
In the same bill, lawmakers legalized unlimited contributions to political parties and legislative campaign committees, except for corporations and groups such as labor unions, which can contribute up to $12,000 a year.
Mike Wittenwyler, a Madison attorney who specializes in campaign finance issues and who has represented outside political groups, said the law changes were “long overdue.” The last major rewrite was in the 1970s, he said, prior to several key court decisions that clarified the limits and rights of donors and candidates.
A Marquette Law School poll found that most citizens of Wisconsin disagreed with the Legislature’s 2015 decision to remove contribution limits on state political parties. In a poll, 61% of respondents said they opposed unlimited contributions, while 13% supported them. Another 25% said they had not heard enough on the issue.
Taken together, these changes have made Wisconsin the “darkest of dark money states,” said Jay Heck, executive director of the Common Cause in Wisconsin, which promotes clean, open and responsive state government.
Matt Rothschild, executive director of the Wisconsin Democracy Campaign, another good government group, offers a similar assessment. “Wisconsin,” he said, “is open for bribery.”
Weiner said secret campaign contributions can come from interests on the left or the right, especially in state elections.
“On the state level, we see a lot more ‘Company X wants a mining concession,’ or something like that,” Weiner said. “And they put a lot of dark money in to basically influence legislative officials to get what they want.”
That is not just an idle example. Documents briefly unsealed during the John Doe investigation show that Gogebic Taconite secretly donated $700,000 to Wisconsin Club for Growth during the recalls in 2011 and 2012. The next year, in 2013, Walker signed the bill loosening mining restrictions — a bill that Senate Majority Leader Fitzgerald acknowledged in a video that the bill was written by the company seeking to build a controversial mine in northern Wisconsin.
People vs. Citizens United
Some advocates for stricter campaign finance laws feel that the only way to blunt such corporate influence over the political system is with a constitutional amendment to override the Citizens United decision.
Wisconsin United to Amend is mobilizing people to sign a petition and to convince city councils and town and village boards to vote on resolutions calling for this constitutional amendment.
The campaign’s messages are: “Money is not speech” and “Corporations are not people.” Currently, more than 130 local governments in Wisconsin and 19 state legislatures have passed the resolution.
“More and more people are understanding … these politicians cannot fix it, because they are bought by those who don’t want to fix it,” said George Penn, a representative from South Central Wisconsin United to Amend.
Many on the left see the Citizens United decision as a stab at the heart of democracy. Wittenwyler takes the opposite view. He believes the decision expands free speech rights.
“Everyone should be able to speak and you shouldn’t make arbitrary decisions based on how an entity may or may not be established,” Wittenwyler said. “I want to live in a society where everyone is allowed to speak without any government oppression of what you’re going to hear.”
Dee J. Hall contributed to this story, which was produced as part of an investigative reporting class in the University of Wisconsin-Madison School of Journalism and Mass Communication under the direction Hall, the Wisconsin Center for Investigative Journalism’s managing editor.