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The one-percent and RI’s Pension Overhaul

December 12, 2012

Old friend (and former ProJo reporter) Mike Corkery of the Wall Street Journal has broken a very interesting Rhode Island pension story. As first picked up by the sharp-eyed Ted Nesi of WRPI_TV, Corkery’s story reveals that a Texas Enron trader billionaire is a hefty contributor to the Engage Rhode Island pension overhaul advocacy group that has been championed by State General Treasurer Gina Raimondo.

The Texan is a Hedge fund billionaire named John Arnold, 38, who the WSJ says has given between $100,000 to $500,000 to EngageRI, which has refused to reveal the names of its top donors. (A stance Raimondo has defended).

EngageRI spokesman Jon Duffy told Nesi he would not discuss Arnold’s financial support. “We respect the privacy of our donors and we continue to do so,’’ Duffy told WPRI.

EngageRI has harvested almost $1 million in contributions since it was started in 2011 to boost cuts in state employee pension benefits. EngageRI is organized as 501c4 organization, so named for the provision of the U.S. Tax Code that it  falls under. Such organizations are under no legal obligation to disclose donors.

Ok, so now we know the one-percent are intensely interested in Rhode Island pension issues. This new revelation by Corkery follows on the heels of  the hiring of New York Super Lawyer David Boies (a story broken here on RIPR) to defend the pension overhaul in court against public employee union lawsuits. On Boies first interview with a Rhode Island reporter, the ProJo’s Mike Stanton, Boies ordered a $235 bottle of wine. We are betting that must have gone over well with the lowly paid  cook’s helpers at URI who are state workers. And now we have a Texas billionaire financing our premier pension lobbying group.

Irony is always a journalist’s best weapon, so once again we have to give Nesi some credit here. Nesi noted that Arnold and his wife have founded a nonprofit foundation called the Laura and John Arnold Foundation, which lists public pensions as a policy thrust.

“The cost of public employee benefits in most states and communities is unsustainable,’’ says the foundation web site. “The economic and social costs of this looming crisis are potentially crippling to our nation. We seek to remedy this untenable situation by promoting transparency and concrete solutions that address the problem in a manner that is comprehensive, lasting and fair to all parties.’’

Some serious transparency there at EngageRI.

We hope this Texas billionaire is as worried about his own state’s dismal record in providing health insurance to children as he is with RI pensions. It is bad enough that Texans own our only statewide newspaper. Do they want our government too?

19 Comments leave one →
  1. December 12, 2012 4:23 pm

    I believe Engage RI avoided participating in the recent elections to avoid TiPS Act disclosures, which would have forced them to reveal who their primary funders were. I wonder if there are other controversial donors they are hiding. Perhaps next election cycle, Engage RI will do some outside spending, and we’ll know who their backers are.

  2. Nichole permalink
    December 12, 2012 5:08 pm

    While I agree 100% that Raimondo should embrace transparency even *if* EngageRI technically-legally-doesn’t have to do so–I just want to point out that no one took exception to Dan Doyle’s crass overspending at URI, and fancy meals on URI’s dime (seeing as it wasn’t paid back)–all the while making cuts to the union pensions. Recall that many of the URI workers’ pensions were altered during that time under Carcieri. So they’ve been subjected to a lot of offensive behavior from the ‘dining club’ over the past few years.

    Also important to note another one of Nesi’s points–to demonstrate how opaque our system truly is– John and Laura Arnold have donated directly to Raimondo’s campaign. It is very difficult and time-consuming for us private citiizens to fully understand the extent to which these campaign donations overlap with policy determinations and vice-versa. Add on top of that the impossible task of understanding the extent of the influence of these shadowy EngageRI donors. We’re screwed!

    One last point–could you clarify your claim of cooks’ helpers making $19000 a year or so? While it’s quite possible, I know that cook’s helpers elsewhere make over $30,000 as a step one.

  3. Spencer permalink
    December 12, 2012 5:23 pm

    Engage RI, under the direction of Gina Raimundo and Gordon Fox did participate in recent elections.

  4. December 12, 2012 6:01 pm

    Boies, of Al Gore Election 2000 (in)fame, has proven to be a disappointment and not worth another hour; another reason we don’t know the DINOs from the RINOs.
    Donors, like sources, must be made known, for both credibility and creditability. Do we want to see RI go the way of Michigan?

  5. December 12, 2012 7:11 pm

    What’s your point, Scott? Shall we let the pension crisis go on, crippling our state? Also, what do URI food service workers have to do with it? Didn’t the article state the Boies was dining at a restaurant downtown? And didn’t it state that he was using his own money, not expensing it to the client (us)?

    • Mister Guy permalink
      December 15, 2012 12:53 am

      “Shall we let the pension crisis go on”

      There was no “pension crisis” to begin with, since the system was solvent for years & years to come and the unions were (and still are) willing to negotiate over necessary changes to the system.

      “And didn’t it state that he was using his own money, not expensing it to the client (us)?”

      LOL…who do you think is paying part of his salary now? The RI taxpayers…that’s who.

  6. December 12, 2012 7:19 pm

    Maybe a glass of House red would have a less hubris-fueled choice in his first foray with a RI reporter.

    • Nichole permalink
      December 12, 2012 7:54 pm

      lol agreed but still would like clarification on the 19000 per yr claim. Thx.

  7. Jan permalink
    December 12, 2012 7:47 pm

    You are missing the point, Ethan. Is this how we want our government to work? Is legislation for sale to the highest bidder? No one argues that pension reform was needed but the state workers and teachers had no voice at the table. The legislation was steamrolled with promises of campaign donations from EngageRI for those legislators that supported it. Our voice was drowned out. Teachers and state workers were willing to make sacrifices and to share in the responsiblity of resolving this but were not given the opportunity. (Testimony at the state hearings does not constitute being part of the decision making.)
    Mayor Taveras showed more respect for his constituents than Ms. Raimondo and the legislators. He was able to enact pension reform working with people not against them. How this matter was handled was as equally important to us as was the final decision. We were dismissed!

    • Ethan permalink
      December 12, 2012 11:28 pm

      I get the point; the pension stakeholders feel underrepresented, and this EngageRI funding revelation fuels skepticism at legislators’ motivations. However, despite the legislation being potentially influenced by outside money, I do in fact feel that my voice was heard. I was supportive of Raimondo’s reform plans from the start, as I think lots of folks were. For the first time in my time here in RI, and as a young person starting out in the working world, I felt like state leadership was doing something that would bring positive change instead of passing the ball down the line with more “studies” and “discussions” that lead nowhere.

      • Mister Guy permalink
        December 15, 2012 12:58 am

        “despite the legislation being potentially influenced by outside money”

        Potentially?? How about definitely…wake up!

        “I do in fact feel that my voice was heard. I was supportive of Raimondo’s reform plans from the start”

        …so you got what you wanted, whether it was legal or not…nice…

        “I felt like state leadership was doing something that would bring positive change”

        How is cutting the buying power of already retired, middle-income workers (that were given legal contracts upon their retirement) by some 40-60% over time “positive change”? How is ramming through legislation that will end up costing the state money in court (where they will ultimately lose) “positive change”? Please…get a grip on reality kiddo…

  8. Jan permalink
    December 13, 2012 1:45 am

    So, I guess that as long as the big money supports your point of view then this is an acceptable way for our democracy to work. The legislative process is for sale. That is the point. Robert Reich says it best:
    ” Big money is a greater threat to the integrity of our democracy than it’s been since the days of the robber barons in the late 19th century, and the mere fact that it didn’t tip the election into the hands of Republicans doesn’t lesson that threat. Wall Street, giant corporations, and billionaires continue to flood the nation’s capital with bribes (what else to call them?) that are distorting policy. They’re already gearing up for the 2014 midterm election. And although most of this money supports Republicans, a large percent is corrupting Democrats as well. Nothing we need to achieve as a nation is possible as long as big money continues to dominate our democracy.”

    • tim2200 permalink
      December 13, 2012 1:01 pm

      Jan given your statement above there is no way you supported Obama. No chance. Right??

      And Scotso is suddenly worrying about transparency in a state dominated, controlled and run into the ground for decades by his party making backroom deals aka “the legislative process” on Smith Hill, a process that has enriched many Democrats and union leaders (same thing) over the years.
      And Scotso’s President is giving Richard Nixon a run for him money in the secretive/deceptive dept.

      Such hypocrites!

      • Mister Guy permalink
        December 15, 2012 1:00 am

        “And Scotso is suddenly worrying about transparency”

        Suddenly? I don’t think that word fits here at all given what I’ve read in this blog for quite some time now.

        “And Scotso’s President is giving Richard Nixon a run for him money in the secretive/deceptive dept”

        …only in your wildest, Right-wing dreams that is timmy…lol…

    • December 13, 2012 7:33 pm

      I’m not a fan of the big money in politics. But would you back away from a stance you felt strongly about because a rich person donated money to it, or a large corporation did? What if a wealthy executive made a huge donation to Planned Parenthood, and you were ardently pro-choice. What would you do? Or, more relevantly, what would you do if a big Hollywood honcho rolled in and donated $1,000,000 to the pro-union side of our local debate? Would you say “hey, back off, we don’t want your donation – that’s the influence of the 1%”?

  9. Craig O'Connor permalink
    December 13, 2012 12:38 pm

    More evidence that EngageRI and the pension “reform” movement is more about protecting the wealthy elite from potential tax increases rather than about actually doing something that is good public policy. Raimondo and EngageRI are mere fronts for the 1%.

  10. Mister Guy permalink
    December 15, 2012 12:47 am

    The select few ultra-rich taking away from the rest of us…and the beat goes on…ugh…

  11. MICHAEL RILEY permalink
    December 17, 2012 1:12 pm

    very disappointing commentary but somehow I am not surprised

    • Riley LOL permalink
      December 17, 2012 5:04 pm

      Very disappointing congressional run, but somehow I am not surprised

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