Tom DeLay's Grand Jury Problem

by Molly Ivins

You may be wondering why House Majority Leader Tom DeLay is raising money for a legal defense fund and telling his fellow Republicans in Washington to be prepared to name his replacement in the event he is indicted. DeLay and Texas House Speaker Tom Craddick may have achieved the near-impossible by breaking Texas campaign finance laws. Since Texas essentially has no campaign finance laws, this is no mean feat.

In Texas, anyone can give any amount of money to any candidate -- the sky's the limit -- you just have to report it. You would think that pretty much solves any legal or ethical complaints, but there is just this one little tiny rule: no corporate or union cash to candidates.

PACs are one way around that, as are "issue ads." As Jake Bernstein of the Texas Observer wrote: "An unprecedented coordination between the Republican administration and big corporate interests held the country tightly in its grip. In most instances, the machine simply enjoyed the exercise of raw power with little effort to justify its actions. Come election time, though, the party of privilege and its moneyed patrons drowned out opponents with the sheer volume of their propaganda. Never before had so many dollars been spent to mass-market a political image. Above all, the machine pushed the message that it was the true guardian of patriotism, indistinguishable from the Stars and Stripes. Then, once in power, it opened the public treasury to a rapacious corporate elite.

"Business lobbyists dictated the law at every level. Legislation was cooked behind the closed doors of private clubs and then passed into law. While the lobby fought ferociously against any check on its prerogatives, it had a special distaste for corporate taxes. Aided by its legislative enablers, the corporate elite indulged in a natural inclination toward monopoly -- especially when it came to media and transportation."

That was Texas in 1905. That was the year populist reformers in the Lege voted to stop company executives from using corporate funds to contribute to political campaigns without stockholder consent. Texas law also prohibits "in-kind" gifts of goods and services, such as office space, staff time and polls.

On Nov. 7, 2002, two days after Republicans had swept state office for the first time, Craddick, who everyone knew was slated to be the first Republican speaker, held a victory press conference at the state capitol. At the bottom of the invitation to the press conference is a small notice, "Paid for by Texans for a Republican Majority."

Texans for a Republican Majority is a political action committee (TRMPAC, pronounced "Trimpac.") created in part by Tom Delay. Travis County District Attorney Ronnie Earle began an investigation in December 2002 into public boasting by the Texas Association of Business (TAB) that it had collected and contributed money from corporations to elect candidates to the Texas legislature.

That investigation led to TRMPAC, which allegedly also raised and used corporate money for political purposes. TAB insists it does not have to reveal the names of its corporate donors (!), Craddick is now scrambling away from TRMPAC, and the whole mess is under investigation by a grand jury.

One of the saddest pieces of evidence in the case, found by the Texas Observer, is a memo from a fund-raising trip to Houston taken by a TRMPAC staffer, Susan Lilly. In five and half hours, she met with six Houston energy and finance executives. TRMPAC and TAB were coordinating the campaign to take 22 House seats for the Republicans, enough to give them a majority and elect Craddick speaker.

Lilly met with a vice president of Compass Bank, who agreed to donate "22K direct" from the bank's PAC to each of the Republicans in the highly contested districts. Next to the contribution is the handwritten note of what Compass wanted in return. "Wants to clean up home equity lending."

They cleaned it up, all right. In the following session, the Lege voted for a constitutional amendment that allows home equity loans on lines of credit, a sort of credit card against the value of your home equity, which allows banks to charge even more than they do on lump-sum home equity loans. When the amendment passed, a Compass Bank spokesman said proudly, "We were first to the market with this."

The case before the grand jury is complex, involving both TAB and TRMPAC, and includes allegations of money-laundering , improper contributions by Craddick to influence the speaker's race and much more. For a fuller account of the case, I recommend the Texas Observer, starting with the Aug. 29, 2003, issue, and then both the Feb. 27 and March 12, 2004, issues.

No one is naive enough to think campaign contributions don't influence the way legislators vole, but there's something so cold about seeing the sum listed next to the purpose for which it's given. The memo is posted on the Observer's website and deserves to be titled, "Death of Democracy."