John Davis Consulting

“Basnight often gives campaign money to the state Democratic Party, which can give  unlimited amounts to legislative candidates.” AP, March 18, 2010 ¹

Last Thursday night, former Democratic Gov. Jim Hunt hosted a fundraiser for Democratic Senate President Pro Tem Marc Basnight at the State Fairgrounds in Raleigh.  According to the Associated Press, 300 to 400 people paying $100-$4000 were expected to show up in order that the good senator from Dare County would have the war chest needed to continue the 114-year winning streak of the Senate Democratic caucus.

Money flows to those with power. Those with power use the money to keep their power. Those with money use those with power to keep their money.   Many of those in attendance at the fairgrounds represented large corporations who claim to be champions of the free market system of economy; a system whereby private interests compete for profit with little governmental intervention.  Truth be known, many of those large corporations … like Blue Cross Blue Shield of North Carolina … use government intervention to gain a competitive advantage over their competition; a role government leaders like former Sen. Tony Rand are happy to play … provided you pay … at events like the fundraiser last Thursday night.

Fund-raising events like the one at the State Fairgrounds are much like a masked ball.  Those with power wear their conservative, free-market masks as they take the political contributions of unsuspecting small and medium-size businesses struggling to meet expenses and hoping for a little relief.  Little do those free-market conservatives know that their money is being co-mingled with the money of labor unions and plaintiff trial lawyers and other liberal groups and used to keep the power in the hands of the powerful … and the money in the hands of the big moneyed interests with their big political checks and their little free-market-conservative masks.  How does it work?   The AP story about the event discloses the charade with the note, “Basnight often gives campaign money to the state Democratic Party, which can give unlimited amounts to legislative candidates.”

For decades, big insurance companies like Blue Cross Blue Shield of North Carolina have ignored the importance of recruiting and maintaining a base of free-market conservative lawmakers.  Instead, they have opted to buy their public policy advantages from government leaders like Tony Rand at events like the State Fairgrounds fundraiser and to use those powerful insiders to cut secret sweetheart deals in order to keep their profits up at the expense of North Carolina taxpayers. ² According to the News & Observer, Rand worked under the radar at the request of Blue Cross Blue Shield of North Carolina to undo a law that would have cut millions of dollars from the soaring cost of medical care for inmates.   Blue Cross Blue Shield of North Carolina is getting what they want with their political investments and could care less that their money is co-mingled with liberal groups and used to defeat free market conservatives.

On Sunday, with the passage of President Obama’s landmark health care legislation, the need for recruiting and helping to elect free-market conservatives in both parties should have been made painfully clear to Blue Cross Blue Shield.  They are being forced to accept reforms whether they like them or not.

See charts and bullet points below for a full disclosure of how business contributions are used against business.

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• The North Carolina Senate, led by Democrats, was once a safe harbor for the state’s business community
• The state Senate is no longer a safe harbor for free-market conservatives because of the decline in Democratic business owners
• The average business score for Senate Democrats has plummeted from 70% in the early 1990s to 52.7% today  ³

• In the North Carolina Senate Class of 1992, over half of the Senate Democratic Caucus were business owners
• Today, you can count the number of business owners in the Senate Democratic Caucus on one hand
• Business ownership declined because of the time it takes to run and serve in the Senate
• The decline in business owners is equally attributable to the lack of recruiting by business groups

• In 2008, $98.7 million was contributed to North Carolina candidates in statewide and legislative campaigns ⁴
• Gubernatorial candidates spent $42,050,870
• Council of State candidates spent $8,824,789
• Appellate Judiciary candidates spent $3,024,436
• Legislative candidates spent $27.8 million

• Of the $27.8 million spent in legislative races, Democrats spent $18.1 million to $9.7 million spent by the Republicans ⁵
• Democrats outspent Republicans 2-to-1

• Political parties spent $14.7 million in legislative races in 2008, with the Democratic Party spending $11.9 million (81%)
• The top 10 donors to the Democratic Party gave twice as much money as all donors to the Republican Party combined
• Three state senators, Basnight, Rand and Garrou, gave nearly $2 million to the Democratic Party ⁶

• Much of the $2 million given to the Democratic Party by Senators Basnight, Rand and Garrou came from business
• The Democratic Party meted out $2 million to four Democrats
• Sen. Julia Boseman, with a business score of 47.9%, received $555,475; Sen. Tony Foriest, with a business score of 48.6%, received $541,043 from the state Democratic Party

• The Democratic Party gave $549,253 to Keith Melton to try to defeat Debbie Clary, who has a business support score of 84% ⁷
• Democratic Party gave $329,288 to Sen. Don Davis who has a business support score of 48.6%
• Davis defeated former Rep. Louis Pate, who earned a business support score of 87.4% while serving in the NC House

• The average business support score of North Carolina Senate Republicans is 80.3%
• The average business support score of North Carolina Senate Democrats is 52.7%
• Big business gives more money indirectly to defeat free-market conservatives in close races than directly to those natural allies

• The Senate Democratic Caucus has 30 members; 3 are in businesses highest category of support
• Due to poor political investment decisions, the North Carolina business community has lost its safe harbor in the state Senate
• Big business joined big labor unions and have practically wiped out most free-market conservatives in the NC Senate

If you are tired of living life on the defensive because of the  destruction of the base of free-market conservatives in the Senate by big business and labor unions, take a look at the chart above and pick one race and throw your money behind a free market conservative.

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NOTE:  This is the final Free Trial edition of the John Davis Political Report.  PREMIUM annual subscriptions are $485 for the weekly report, or $50 per month.  PREMIUM annual subscriptions to the weekly report include 10 password protected subscriptions limited to company employees or directors.  ADVANTAGE annual subscriptions are $4950, or $500 per month.  ADVANTAGE annual subscriptions to the weekly report include 50 password protected subscriptions limited to company employees or directors.  ADVANTAGE subscribers receive personalized written reports, 5 hours of consulting (including private briefings at your place of business) and one speech at your annual meeting or trade association event. Click here to subscribe!

FOOTNOTES

1. AP, March 18, 2010; Basnight event helps Senate Democrats
2. http://www.newsobserver.com/2010/02/12/334312/rand-kept-inmate-medical-costs.html#ixzz0ipLdbmtnWill
3. Business scores prior to 2009 are from NCFREE.  The 2009 business support scores are from the NC FreeEnterprise Foundation
4. See www.followthemoney.org
5. North Carolina data-net, October 2009, Issue #49
6. North Carolina State Board of Elections
7. Business scores prior to 2009 are from NCFREE.  The 2009 business support scores are from the NC FreeEnterprise Foundation
8. The News & Observer, Rand kept inmate medical costs high, February 12, 2010, Pg. 1A