That was Assembly Speaker Fabian Nunez today at an event in downtown Los Angeles, in front of a Chevron station (that was selling gas for a low low $3.49, I think the advance man could’ve found stations 30-40 cents higher without too much trouble), as he announced with Assemblymen Mike Davis, Mike Feuer and Mike Eng a series of bills to combat rising gas prices and the artificial depression of refinery supply.  The bills will seek to oversee refinery maintenance, expand regulatory authority, and deal with the “hot fuel” issue.  The Speaker said that “During the electricity crisis a few years ago, California adopted similar measures to keep energy companies from using these convenient (refinery) shutdowns to amp up their profits, and today we’re going to make sure oil companies can’t use Enron-like tactics on California consumers.”

This is an object lesson in why now was the exact wrong time for the CDP to accept $50,000 from the prime progenitor of those Enron-style tactics.  And it actually came up in the press conference.  A full report on the flip, with audio to come.

Nunez referenced a Wall Street Journal article (behind the wall, sadly) that detailed how refineries are cashing in on high gas prices by artificially lowering their supply through various methods, particularly shutdowns.  The three bills work out this way:

1) new oversight committee: Nunez and Eng’s bill would create the California Petroleum Refinery Standards Committee, made up of the Attorney General, the State Controller and a couple political appointees, which would develop standards for maintenance and operations at California refineries, would look into shutdowns and would increase mandatory reporting from oil companies regarding them, would take audits and inspections, and would ensure compliance.  Penalties for not complying to these standards, would be “very stiff” and would be considered felonies, not misdemeanors.

2) “Hot fuels”: temperature varies in fuel, and it impacts the weight of gasoline, which since it’s sold by the gallon impacts the price.  The suspicion is that oil companies are manipulating temperature variations to give the consumer less for its money.  Assemblyman Mike Davis’ bill would seek a comprehensive study, cost-benefit analysis, and recommendations on what the national standard for gasoline temperature should be.  Right now it’s 60 degrees; the concern is that the number should be higher.

3) Petroleum Industry Information Reporting Act: oil companies are not releasing enough data to determine properly the efficacy of inventory levels and profit margins.  Assemblyman Mike Feuer’s bill would mandate monthly financial reports on oil supply, demand, and price issues.  It would also allow that information to be shared with the Attorney General and the Board of Equalization.

These appear to be decent bills that correctly address the issue of artificial refinery supply.  However, in the question-and-answer session that followed, there was an example of why it is not smart to play both sides of this fence.

The fact that the backdrop of the press conference was a Chevron statement is telling; after all, they own 25% of the refineries in the state, and they are getting rich off the high gas prices being made by their actions at those refineries.  The VERY FIRST QUESTION offered to Speaker Nunez was about his trip to South America paid for in part by Chevron.  Nunez replied that the trip was “insignificant,” that the trip was taken to learn more about alternative fuels in South America, that he stands for issues that are important to Democrats, and that he resented any attempt to question his ethics.  And right after the presser was over, during a sort of press gaggle, he told the radio reporter who asked that question that is was either a “cheap shot” or a “chicken shit” question (I wasn’t quite close enough to fully make it out).  The reporter replied that the information was out there and she was just giving the Speaker a chance to respond.

Clearly that’s a fair question.  And clearly it’s fair to ask whether, at a time where the Speaker of the Assembly is accusing Chevron of market manipulation and of engaging in “Enron-like tactics,” it’s the best time for the CDP to be taking a $50,000 contribution from that same corporation.  Now more than ever, the message should be united, and the perception here is quite confusing, and more hurtful than the money is helpful.  I appreciate these efforts to stop market manipulation, but I do not appreciate giving the opposition another arrow in their quiver through the appearance of impropriety of this donation.  I renew and strengthen my call for the Party to return the money and work in more innovative ways to fundraise and grow the party.

(update: Frank Russo reports that the Speaker of the Assembly will introduce various bills tomorrow regarding refinery capacity and gas prices.  I believe that this is an attempt to allay the Foundation for Taxpayer and Consumer Rights’ concerns; they have distributed petitions for a special session of the Legislature, after all.  I give tentative support to the Speaker’s efforts, and hope that it won’t befall the same fate as Joe Dunn’s bill last year, which never made it out of the Assembly.  This is the beginning of the fight, not the end.  The rest of my article, which deals with the CDP and really not the Speaker, holds.)

I appreciate all the comments in my somewhat provocative diary on Chevron’s $50,000 donation to the CDP and why I think there’s a better way to do business.  I’m no hallowed saint when it comes to politics, and I understand that right now it takes lots of cash.  But my main point is that money received from this particular company at this particular time with these particular underlying scenarios, whether taken in good faith or bad, will not do as much to reach new voters as it will alienate old ones.  People have every right to assume that a politician or a party who receives a large donation from a corporate entity will be expecting something in return, as the instances of such exchanges being consummated are too numerous to count.  And $50,000 buys 1 ad in LA during election season, maybe not all of it, but it drives hundreds of activists crazy, and every decline-to-state voter that hears about it just shakes their head and continues to believe the perception that “they’re all the same” in politics.  I know personally, from the reaction this has gotten, that people are upset.  It doesn’t mean they’ll stop working for the party, but maybe they’ll stuff one less envelope.  Maybe they’ll make one less phone call.  And maybe they just won’t feel as invested in a big-donor top-down party as they would in a small-donor bottom-up one.

more…

I don’t know if everyone’s aware of this, but the CDP has a horrible reputation in this state, if it has a reputation at all.  At a time when people are deserting the GOP in record numbers, we’re barely moving the needle.  The only way to turn this around is to erase this idea that both parties have their own special interests and that politics is politics and “a pox on both their houses.”  This donation, particularly from this company (I wonder how Steven Bing feels about it?), particularly with gas prices and oil co. profits both at an all-time high, particularly where the company is artificially decreasing supply like they’re OPEC, is to me a no-brainer.  It hurts the party.  To those who think that parties rise and fall on candidates rather than who gives the candidates money, I advise you to consult Wikipedia under “corruption, culture of,” which was universally given as the biggest reason for the Democratic success nationwide in 2006.  I fail to see why you would willingly invite comparison, when there’s a better way to raise money that brings more people into the donor pool and proud to be a part of the party at the same time. 

Further, something the party did in the past doesn’t innoculate it from future criticism.  Just supporting Prop. 87 and abandoning the issue when it loses is not enough.  The gas crisis is playing out right now.  CA Democrats have done nothing about it, haven’t really talked about it, since November, save for spending money on infrastructure bonds that call for more roads and make the problem worse.  Maviglio has said “just wait, we’re working on it” so we’ll see.  But I can’t help but believe that pressure LIKE WHAT I AM NOW DOING is a driving factor in that.

What this is all about is how the party can break with the past and move into the future.  Taking a stand on this particular contribution, coming up with a more innovative and respectable solution, will reap a hell of a lot more goodwill than $50,000 ever could.

There is a draft letter being circulated among delegates requesting respectfully that Chairman Torres returns this money and works on better funding solutions that are more about party growth.  If anyone would like to sign on to it, email me through the site and I’ll send you a copy.

(also available in blue)

I am fairly surprised that more has not been made in the blogosphere of the unwelcome news that Chevron is doing everything it can to buy off the California Democratic Party and some of its top legislators.  Outside of this small item in The Oil Drum, pretty much nobody has said a word about the fact that the CDP accepted a $50,000 check from a company that is attempting to artificially depress capacity and manipulate the energy market in a way that is shockingly similar to how Enron made themselves a fortune during the 2000-2001 energy crisis.  You can read the details here.

As a delegate to this party, I feel personally tainted by this donation.  I feel like there is a concerted effort to buy my silence.  It will not work, and I want to outline why I am respectfully asking this party, of which I am a member and to which I pay dues, to return the money.

I don’t think I have to go into how Chevron controls the oil market in California by owning most of the refineries, and that in another era that would rightly be called a trust.  I don’t need to discuss their record profits or their expenditures of $44 million to defeat ballot propositions like Prop. 87 and Prop. 89 last year, or their consistently greedy profit-taking at a time of record gas prices throughout the state, or how they refuse to increase refining capacity to keep that profit artificially high.  And I don’t need to explain how corporations aren’t in the business of charity, and that every expenditure they make has a stated outcome, whether for public relations purposes or to engender favorable legislation or just to keep government off their backs while they continue to rake in billions.  What I can talk about is the poverty of imagination that leads the CDP to take a gift like this.

What bothers me most about taking a fat corporate donation like this, from the very interest group you fought tooth and nail against on Prop. 87 just 6 months ago, is how LAZY it is.  There are an unlimited amount of ways to raise $50,000 that not only show no appearance of impropriety or corporate favoritism, but bring people into the process and grow the party, which are the key metrics for politics in the 21st century.  If you really needed $50,000 in a state of 37 million people, how about this: ask 50,000 to give a dollar to specifically ensure that the CDP won’t be beholden to big corporate money.  You can hold dollar parties and write about how giving citizens a stake brings them closer to the party.  And in return for that dollar, you could give people prominent space on the CDP website to upload a minute of video about what problems facing California most affect them.  Then, once the money is collected, PUBLICLY REBUFF Chevron by telling them that their donation has been paid by the people.  Not only would you be seen as populist folk heroes, you would be investing in the party by allowing 50,000 Calfornians get a share and a stake.  That’s called people power.  The new metrics for the Presidential campaigns, for example, are not just money but numbers of donors, because that shows a broad base of support.  A party that gets rich off fat $50,000 checks is a mile wide and an inch deep.  We already have a party like that in California.  It’s called the Republican Party.  And I expect them and their leaders to take hundreds of thousands from the oil industry, as Arnold has.

If that corporate money were even drilled in to infrastructure and party building, that would be something.  But typically, it’s not.  And the party that continues on a traditional model of collecting big corporate checks and running big broadcast ads will be obsolete in a new media environment.  Stoller:

We need to figure out new metrics for receiving party support aside from money and polling.  Perhaps opt-in email addresses acquired?  Friends on MySpace?  Newly registered voters (I like this one)?  Chatter across blogs using sites such as Blogpulse?

I’m not sure, but the whole landscape of politics is shifting.  It’s like an entirely new grammar is emerging, but we’re not there yet.

A “dollar party” strategy, that could spread virally through social networking sites (is the CDP even on MySpace or Facebook?), that would bind more people to the party in a small way and set up a core of activists for GOTV, that would allow a press release that says “50,000 donors!” instead of hiding the fact that one polluting Big Oil ripoff artist gave you 50,000 dollars… would simply be a forward-thinking way to grow the party and gather attention.

I’m sure that there are a host of conciliators and “my-party-right-or-wrong” types that have a problem with me sharing even a scintilla of disagreement with the state party (there’s another guy that believes in the silencing of any alternative voices, he resides at 1600 Penn. Ave, Wash, DC, 20500).  First of all, I would have them take a look at the rise of DTS voters and the lack of success in joining the progressive wave in 2006 and ask them where all that brushing aside criticism has gotten them.  But the second thing I would ask them is, why are you a Democrat?  What do you believe, if anything?  And how do you square that belief with the fact that one of the companies most committed to stopping any progress on global warming or reducing dependence on foreign oil just handed you – you! – a wad of money in order to shut you up?

The Speaker’s Office claims that these donations won’t impact Democrats’ ability to take a hard look at what Chevron is attempting to do on refining capacity, and that “tough” legislation is forthcoming.  I would hope so.  I cannot impact what individual candidates receive in gifts; at least, not until election season.  I can have an impact when it’s my party.  I’m a delegate and a member in good standing.  I know for a fact that members of the Party leadership read this site.  I’m asking those in charge at the CDP, nicely, to give back the Chevron money.  I want to work on innovative fundraising solutions that can simultaneously fund the important work of the party and bring it closer to the people whom it serves.  But like any addiction, the first step is admitting you have a problem.

(Learn the rules to the game – promoted by Lucas O’Connor)

Thank you for your e-mail Marlene.

On your first issue, keep in mind the definition of resolutions that the State Party operates on—a philisophical statement. Resolutions are not designed to manage the Party structure. Generally we refer resolutions that deal with party structure to the Organizational Development Committee. We refer resolutions that would change the bylaws to the Rules Committee. We generally refer resolutions that seek a support or opposition to a specific pience of legislation to the Legislative Committee. For example, the resolutions that would create an audit committee is a bylaws change. You can’t change the bylaws by way of a resolution. The proponent could have made a bylaws change at this Convention but chose not to use the proper process. We did refer some resolutions calling for support for legislation to the legislative Committee. Your resolutions dealing with 58 counties were part of a referral to the Task Force that Art is developing. Art committed that the proponents/authors(in this case your Don Lowrie I take it) would be on the Task Force.

Second, its not written in stone but its good common sense to show up at a meeting where your resolution is going to be heard. We actually heard from almost all the resolution sponsors of those resolutions that were going to be referred to the Task Force. Had anyone represented themselves as a sponsor or spokesperson for your resolution they would have been allowed to speak. We got 117 resolutions this time and every convention has alot of resolutions. My co-chairs and I develop a consent calendar if we’re able to come up with some agreement on what to do with a resolution. Resolution Committee members will often disagree and pull a resolution to discuss other courses of action. Whatever the recommendation, a proponent is allowed to make their case. I am sorry you had a conflict but they are frankly unavoidable. We work with delegates who come to us and ask us to put their resolution on a “second call” or if possible, handle it as a priority. We can’t always do this but we will try to accomodate people where possible. Suggestion for next time—have someone else attend the Rural Cuacus(or have someone else attend resolutions committee). Keep in mind even if you had shown and spoke up the Committee most likely would have referred your resolution to the Task Force.

Third, those resolutions passed by our Committee and not taken to the floor(non-prioritized resolutions) will go to the floor of the Executive Board in July. Those resolutions which were late and objected to will goto the July Executive Board resolutions committee. The 58 County and 50 state strategy resolution will not come back to our Committee unless the Task Force send it back to us. If you introduce a new resolution similar to this we will refer it to the Task Force and/or the Organizational Development Committee.

Fourth, check your convention rules which discusses what a resolution is. Our Committee is reworking our Resolutions Procedures and will have a new handout which we will have posted on the CDP web site prior to the 10 day cut off for resolutions to be submitted to the executive Board. Until then I would refer you to the Bylaws and if you have a specific question opn a specific resolution please e-mail me and I will help you as best I can. Keep in mind, no more then 3 whereas and 2 resolve clauses, keep away from areas outside Resolutions Committee jurisdiction(bylaws, Organizational Development, legislation), make sure you have it sponsored by a committee members(easier to introduce a resolution to E-Board then Convention) and show up at the meeting or have someone who will speak to it. By the way, a resolution can support the concept embodied in legislation, just not the legislation itself. The Legislative Committee will report their resolutions back to the Resolutions Committee.

I hope these responses have been helpful. Like you, im a volunteer who is trying my best to help the Party. We passed some wonderful, important resolutions in San Diego and I look forward to having good quality resolutions passed at the Executive Board meeting in July.

Conventions are a whirlwind.  You promise to do 50 things and you end up doing 5.  You meet 200 hundred people and can’t remember their name afterwards.  You walk more in a day than you would in a week.  But ultimately, that little corner of the convention, that little snapshot, is as illuminating as an omniscient bird’s-eye view.

The turnout for the Progressive Caucus was amazing.  I would guess about 400 delegates and supporters packed one of the biggest rooms in the convention center.  I would say that the Progressive Caucus has arrived.  It only started two years ago, and now it’s the largest caucus in the Party.  Assemblyowman Loni Hancock gave a report on her Clean Money bill, AB 583, which passed the Assembly Elections Committee.  Mimi Kennedy talked about election protection.  Brad Parker gave a stirring speech about the rise of the progressive movement.  It was great stuff.

As I said, the Resolutions Committee folded a lot of the more contentious resolutions into some more mealy-mouthed ones.  Of particular concern to me is the resolution to form an Audit Committee, so I’ll be heading out to gather signatures to bring that one to the floor.

over…

The blograiser was amazing.  Unfortunately I spent so much time getting the liveblog up at Daily Kos that I didn’t have a ton of time for interaction.  But I did get to talk with Charlie Brown for quite a while about Iraq.  His son is over there right now flying planes in the Air Force.  He talked about how 40% of the officer corps is walking away from the service, how 30% of the Air Force planes have been grounded for wing cracks, essentially how the military has been broken by this conflict and how it’ll take years to get the ship righted.  Charlie is a great guy.  I can also boast that both Brown and Jerry McNerney commented on the live blog from my laptop!

One great thing that stood out is when Todd Stenhouse, Brown’s campaign guy, was talking with a couple of us, and said, “I get calls from reporters all the time asking, ‘Who’s dday, who’s juls, who’s Land of Enchantment, and why do they keep scooping me?'”  LOL.  We’re just faster is all because we don’t have a paper to meet a deadline for.

After the blograiser we headed out to some hospitality suites at the Convention Center.  The Young Democrats event was pretty fun.

Highlight image of the convention so far: Dude at breakfast with no shirt, a leather jacket, and two Yoplaits(?).

OK, gotta go…

There’s obviously been a lot of chatter about what resolutions to support at the CDP Convention this weekend (incidentally, the Resolutions Committee will only allow about 10 to get to the floor, and unless you get a buttload of signatures, that’s all that will be voted upon, so choose wisely).  I’m going to make a plea for one that would actually change the way that the Party conducts its business.  I don’t think there can be any more important a proposal, one that would demand accountability from the CDP and move us on a course to a 58-county strategy, than the resolution to form a standing Audit Committee as a change in CDP Bylaws.

What we’ve been talking about these past couple days is how the CDP can best allocate its resources to give Democrats in the state the best opportunity to succeed.  Any business dealing with such massive asset allocation would consider it a duty to check the books every once in a while and see how things are going.

Right now the CDP does not really do this.  A seat on the Finance Committee is pretty much closed unless you are a major donor, can pull in major donors, or you promise your first-born son to the Chair.  And the accountability for the decision-making on what candidates to support or to not support is practically non-existent.  We know that $4 million dollars left over from the last campaign was magically transferred to Fabian Nunez’ account for Assembly caucus work (some would say services rendered from AT&T).  That money should not have been available at the end of an election season.  Yet there is no transparency in the process.  This is why there needs to be a change in the bylaws to allow an Audit Committee.

In a very smart and studied explanation of how this would work, the authors of the proposal state:

An audit committee is an operating committee whose members are normally independent of the management of the organization and/or drawn from outside directors.  Audit committees are formed to assist the management of an organization by providing an independent review of the effectiveness of the organization’s financial reporting process and internal control system(s).  Responsibilities of an audit committee typically include:

Overseeing the financial reporting process.
Monitoring choice of accounting policies and principles.
Monitoring internal control process.
Overseeing hiring and performance of the external auditors.

This essentially would act as a financial oversight committee that could make recommendations on how to best allocate resources.  They would also ensure that the “financial statements” of the CDP meet with the approval of all of the “shareholders,” in other words, us.

The California Democratic Party (CDP), a dues membership organization, directs the expenditure of tens of millions of dollars each election cycle, most of which is subject to compliance guidelines governed by the Bipartisan Campaign Reform Act of 2002 (BCRA).  The CDP commissions a bi-annual internal audit and an annual audit.  Information regarding distribution of the auditor’s reports has not been disclosed to the general Party membership. Under the Nonprofit Integrity Act (SB1262), the annual audit of non-profit organizations required to register with the California Attorney General’s registry of charitable trusts must be made available within 24 hours to any member of the public who requests it. Although the CDP is not subject to that requirement, accountability to its donors would be served by adhering to the same standards for other organizations which raise their funds primarily from donors.  The CDP’s auditor has reportedly been retained in his current capacity for nearly ten years.  Most organizations change auditors every five years.  Best practices, along with SB 1262 requires an audit committee for organizations with annual revenue of over $2 million, and the CDP certainly meets that criterion.

As for whether a resolution is in order, it would actually entail changing the CDP Bylaws.  If enacted, an Audit Committee would be formed, just as we have a Rules Committee, Platform Committee, et al.

Here’s what else I like about it: the Audit Committee would ensure regional diversity.

To ensure the Audit Committee’s continuity from term to term, the Audit Committee should have as many members as there are regions (21), with terms both staggered and elected.  The first election would be for all regions; half of those elected serving for four years and the other half for two years).  Three subcommittees would be formed: Finance, Performance and Compliance, with seven members each, respectively:

The Financial Audits Sub-Committee – would deal strictly with financial matters (allocations and expenditures)

The Performance Audits Sub-Committee – would deal strictly with the Party’s performance to assess whether it is achieving economy, efficiency and effectiveness in the employment of its available resources.

The Compliance Audits Sub-Committee – would deal strictly with legal reporting matters and responding to published laws and regulatory agency requests.

We should not have to hear about $4 million dollar expenditures in the newspapers.  We should not have an unaccountable system where money flows to various people for inscrutable reasons.  We, as Democrats, deserve to have an independent board auditing the CDP, to ensure accountability and efficiency.  And once that happens, more money can be freed up for the kind of year-round blanket organizing that you need in order to make this Party grow throughout the state.