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Jewish World Review
Sept. 10, 2007
/ 28 Elul, 5767
A Bundle of Trouble: You wouldn't want to be in Hsu's of Hillary Clinton or Barack Obama
John H. Fund
Barack Obama and Hillary Clinton are fund-raising powerhouses. On Saturday alone, Mr. Obama scooped up $3 million at a gala hosted by Oprah Winfrey. The candidates are happy to tout their cash hauls. Just don't ask them to identify the contributors whose money disgraced donor Norman Hsu delivered to their campaigns.
Both campaigns are donating to charity the limited direct contributions Mr. Hsu made to them. But Mr. Hsu's influence went far deeper. In 2005, he helped host a California fund-raiser for Mr. Obama, where he introduced the senator to Mark Gorenberg, a venture capitalist who is now one of Mr. Obama's biggest fund-raisers.
Mr. Hsu later became one of Mrs. Clinton's top bundlers powerbrokers who collect many small donations for delivery to candidates. He brought in hundreds of thousands of dollars to her and other Democratic causes. The Wall Street Journal reports that many of the contributions came from "people who had no prior history of political giving or obvious means for paying."
Take the Paw family of Daly City, Calif., which is headed by a mail carrier who makes $49,000 a year. Members of the family have given almost $300,000 to politicians, including Mrs. Clinton and Mr. Obama, since 2004, often on or about the same days that Mr. Hsu gave money. The U.S. Justice Department is investigating whether any Hsu donors were illegally reimbursed for their contributions.
Bundlers are now very much in the news. All the major GOP candidates have had their own controversies involving bundlers. Last month, Geoffrey Fieger, the trial lawyer who was the 1998 Democratic nominee for Michigan governor, was indicted on charges he conspired to make more than $125,000 in illegal bundled contributions to the 2004 presidential campaign of John Edwards. Back then Mr. Edwards flatly refused to identify his bundlers.
Such scandals were part of what prompted Congress to pass an ethics reform bill that is now on President Bush's desk. It would require all campaigns to disclose the identities of bundlers who are lobbyists and bring in over $15,000 in any six-month period. Both Sens. Clinton and Obama voted for the bill, and Mr. Obama would like to go further. Last week, he announced he will introduce legislation to require campaigns to disclose the identity of all bundlers and the amounts they bring in.
But any new disclosure laws wouldn't cover donations made before they're enacted. Mr. Obama is sending letters of inquiry to five donors publicly identified in the media as linked to Mr. Hsu, but his campaign says it doesn't have any records of any other possible Hsu-linked donors, even though Mr. Hsu has told friends he was careful always to let the campaigns know which contributions he had brought in.
As for Mrs. Clinton, her spokesman Howard Wolfson told the Los Angeles Times that she was declining to release the names of her bundled donors. No wonder. The Clinton campaign has been frequently beset by contributors running afoul of the law. Last week, a leading Clinton supporter and fund-raiser in New Jersey, Mayor Samuel Rivera of Passaic, was arrested on bribery charges in an FBI sting operation. In March, businessman Abdul Rehman "Ray" Jinnah fled the country after being indicted on charges he funneled illegal contributions to Mrs. Clinton and other Democrats.
All of this recalls the 1996 Bill Clinton fund-raising scandal, which ultimately led to 22 guilty pleas on various violations of election laws. Among the Clinton fundraisers and friends who pleaded guilty were John Huang, Charlie Trie, James Riady and Michael Brown, son of the late Clinton commerce secretary Ron Brown. But a lot was never learned, even after the revelations that Mr. Clinton had personally authorized offering donors use of the Lincoln Bedroom and Oval Office meetings. A total of 120 participants in the fund-raising scandal either fled the country, asserted their Fifth Amendment privilege against self-incrimination, or otherwise avoided questioning.
A 1998 Senate Government Affairs Committee report on the scandal found "strong circumstantial evidence" that a great deal of foreign money had illegally entered the country in an attempt to influence the 1996 election. Johnny Chung, a bagman for the Asian billionaire Riady family, confessed that at least $35,000 of his donations to the Clinton campaign and the DNC had come from a Chinese aerospace executive a lieutenant colonel in the Chinese military who he said helped Mr. Chung meet three times with General Ji Shengde, the head of Chinese military intelligence. Mr. Chung testified that Gen. Shengde had told him, "We like your president very much. We would like to see him re-elected. I will give you $300,000 U.S.. You can give it to the president and the Democratic Party."
Clinton defenders suggest that those who make comparisons between the sloppy vetting of Mrs. Clinton's 2008 campaign and her husband's 1996 scandal are bigots because of the presence of Asian names in both cases. Margaret Fung, director of the Asian American Legal Defense and Education Fund, says any comparison "insinuates" that Asian-Americans are more prone to making illegal donations and represents an "obsession" with Asian donors. Nonsense. It shows that Team Clinton seems to have a recurring problem vetting its donors. It seems to have learned nothing from its 1996 experience, and just may be repeating it.
The failure to disclose Mr. Hsu's contribution network by Mrs. Clinton is significant. "It would paint a map for the press if it was interested of who Hsu is and what he was attempting to gain," says radio host Hugh Hewitt. That Mrs. Clinton and Mr. Obama talk such a good game about the need for disclosure of bundlers and their activities and yet won't or can't reveal any information about Mr. Hsu's network of donors is yet more evidence of why we should pay attention to what politicians do, not what they say.
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JWR contributor John H. Fund is author, most recently, of "Stealing Elections: How Voter Fraud Threatens Our Democracy". (Click HERE to purchase. Sales help fund JWR.)
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© 2006, John H. Fund