San Diego When word broke two weeks ago that a group of local fat cats was paying for more than half a million dollars' worth of TV ads against San Diego Unified School District boardmember Frances O'Neill Zimmerman, the business lobby quickly went into damage control. Tyler Cramer, a lawyer and chamber of commerce functionary, declared that the anti-Zimmerman donors -- including Padres owner and high-tech venture capitalist John Moores ($100,000), Wal-Mart heir John T. Walton ($100,000), Qualcomm founder Irwin Jacobs ($100,000), and downtown real estate mogul Malin Burnham ($50,000) -- were simply worried that Zimmerman was bad for business.
Cramer denied reports that the wealthy anti-Zimmerman forces were working to assure the election of Zimmerman's opponent, lawyer Julie Dubick, in order to obtain a crucial fourth board vote to sell off a trove of district-owned real estate to the city's business insiders. The local capitalists, Cramer insisted, had a nobler goal in mind.
"The business community, and everyone whose job depends on a business, needs first a constantly replenished pool of employees who can competently read, write, compute, think, and communicate in English and preferably in at least one other language," Cramer wrote in a letter to the Union-Tribune. "It needs school systems that current and prospective employees deem acceptable for the education of their children." By opposing the so-called "Blueprint for Education" backed by Superintendent Alan Bersin, Cramer and others maintained, Zimmerman was blocking educational progress.
But what of the other reported donors, Public Interest Project, Inc., and Essential Information, Inc., two obscure East Coast nonprofit foundations? On the surface, at least, the two foundations are anti-business and odd bedfellows of Moores, Jacobs, Walton, and Burnham. But who is really behind the foundations' donations? So far, neither foundation is saying.
According to John Johnson, San Diego Urban League president and titular head of the anti-Zimmerman drive, Public Interest Project has so far contributed $60,000 and Essential Information has given $110,000 -- in all about a third of the TV ad budget to date. One group, according to its website, has a self-avowed anti-corporate agenda. The other supports liberal environmental and public-health causes. Both are run by critics of big business; neither has previously expressed an interest in education issues.
Essential Information, founded in 1982 by Ralph Nader, works against the World Trade Organization and makes a specialty of loathing multinational corporations. Public Interest Project funds environmental education in Taos, New Mexico; a midwifery support group in New York; and anti-pesticide lobbying efforts. Before now, neither has dealt with issues of education reform, nor has either ever before had anything to do with San Diego and its peculiar brand of big-money politics.
According to its tax return for 1998, the latest available, Public Interest Project, Inc., took in more than $919,000 in "gifts, grants, and contributions" in 1998 and had total assets of over a million dollars. The statement did not list the foundation's source of income. Among reported expenditures were $151,000 for "consultants," $14,000 for "focus groups," and $146,000 in "project expenses."
A statement in the tax return says the group "was organized to undertake numerous studies, campaigns, and initiatives on consumer, environmental, public health, urban policy, and other issues."
Current projects, the statement goes on to say, "include a national coalition on midwifery; Trust for America Health, a project designed to coordinate the efforts between the environmental and public health sectors; a campaign to preserve the wilderness areas in the Adirondacks; New Yorkers for Accessible Health Coverage, an effort to improve the availability of health care to disadvantaged New Yorkers; and the Wilderness Support Center, a start-up effort to assist with coalition building efforts among local and state wilderness preservation groups in the Rocky Mountain region."
The statement adds that Public Interest Project "also provides foundation management services for three small family foundations. The program areas for all three foundations focus primarily on the government, with one foundation having a small grant program in the area of population. Grants awarded by each of these foundations have had a significant impact on preserving the environment, an issue that has been at the force of the public interest for the past two decades."
The president of Public Interest Project is Donald Ross, a well-connected lawyer, lobbyist, and longtime liberal activist in New York and Washington. A biography on the website of his Washington, D.C.-based law firm, Mehri, Malkin, and Ross, says he was born in the Bronx in 1947, graduated Fordham University in 1965, and got a law degree from New York University in 1970. A founder of the Nader-sponsored New York Public Interest Research Group (NYPIRG) in 1973, Ross was also chief executive officer of the Rockefeller Family Fund from 1985 until 1998.
Ross and his partner, attorney Arthur Malkin, also run the lobbying firm of Malkin & Ross, based in the New York state capital of Albany. Chief among their clients is the New York Trial Lawyers Association. A June 1997 critique in Crain's New York Business alleged that Ross has used his ties with the New York Public Interest Research Group, funded by student fees from public universities in New York, to help the trial lawyers argue against a tort-reform bill in the legislature.
"NYPIRG's founder, Donald Ross, and its former chief lobbyist, Arthur Malkin, are now the lobbyists for the state trial lawyers organization. Last year, their firm, Malkin & Ross, collected $100,000 from the association to represent it in Albany," according to the article. "They have used that clout to create one of the most hostile civil-justice systems in the country for businesses and municipalities. New York's difficult tort environment costs companies and public entities such as New York City hundreds of millions of dollars a year while enriching the trial bar."
Other Malkin & Ross clients, according to an April 1997 profile of the firm in Albany's Capital District Business Review, include the National Abortion Rights and Reproductive Action League, the Lesbian & Gay Community Service Center, the Campaign for Tobacco Free Kids, and the Mental Health Association of New York.
Ross and Malkin also run M&R Strategic Services, described by the Capital District Business Review as "a government affairs and media relations firm with offices in Albany; Washington, D.C.; New York City; and Portland, Oregon. Staff at M&R complement the work of Malkin & Ross, doing outreach to and organizing of grassroots groups, and supporting campaigns with public relations activities."
Essential Information, the foundation that is reported to have given $110,000 to the anti-Zimmerman campaign, is based in Washington, D.C. According to its website, the foundation was founded in 1982 by Ralph Nader and provides "provocative information to the public on important topics neglected by the mass media and policy makers." It publishes a monthly magazine called the Multinational Monitor, which features articles with headlines such as "Corporate Pigs and Other Tales of Agribusiness," "Big Business Looks to Sew Up the Chinese Market," and "The World Bank: Fifty Years Is Enough!"
In addition to the Multinational Monitor magazine, the foundation publishes "Spotlight on Corporations," which, its website says, features "data on corporate wrongdoing. Our data sources include litigation, internal company documents, and government filings. We primarily publish important information that has been neglected by the mainstream press, or is in danger of being suppressed by corporate cover-up efforts."
Essential Information, according to its 1998 tax return, is run by Russell Mokhiber, a longtime anti-corporate activist. According to his website, Mokhiber is "one of the nation's leading authorities on corporate crime, is the editor of the Corporate Crime Reporter, a legal weekly, and the author of Corporate Crime and Violence: Big Business Power and the Abuse of the Public Trust."
"Corporations dominate our society," Mokhiber, 46, told the St. Petersburg Times in 1997. "Corporations are the only criminal class that has so marinated the lawmaking process with their money that they both define the law and influence enforcement of the law," he said. Last year Mokhiber told the New York Times that "Corporate crime is crime without shame. It's gotten to the point where when a corporation pleads guilty to some criminal act, the stock goes up."
According to the Times account, Mokhiber was born in Niagara Falls in Upstate New York, "where his father and several other family members were rank-and-file workers for Union Carbide. Mr. Mokhiber says that, even as a child, he was deeply troubled by the impact of industrial pollution on his community." He graduated from George Washington University in Washington, D.C., in 1976 and Antioch Law School in 1979. During law school, the paper says, Mokhiber worked for Nader's Corporate Accountability Research Group. "My politics were defined a lot by Niagara Falls -- and by Nader's influence," he told the paper. As of last year, the Times reported, Mokhiber lived on an organic farm in West Virginia, a 90-minute commute to Washington.
According to its 1998 tax return, Essential Information raised $672,000 in "direct public support" and had net assets of $166,000. Like Public Interest Project, Inc., Essential Information did not disclose its list of donor identities. That information, the return says, is "according to the regulations of the Internal Revenue Service...not available for inspection by the public."
Though neither foundation reveals its sources of income, another foundation that did make public its donor list says it gives to both Essential Information and Public Interest Project. The Benjamin Spencer Fund reported giving more than $200,000 to Public Interest Project in 1998. The money was earmarked for a variety of causes, including midwifery and the "Progressive Leadership Alliance of Nevada." The latter is a "coalition of labor, women's organizations, environmentalists, and trial lawyers" currently attempting to defeat a gay-marriage ban measure on this November's Nevada state ballot, according to an account in the Los Angeles Times. The Spencer Fund also gave $35,000 to Essential Information for what was listed as "general support."
Pam Maurath, an employee of Public Interest Project, confirmed in a telephone interview from New York last Friday that the foundation had contributed "between $55,000 to $60,000" to the Partnership for Student Achievement in San Diego, though she said she was "not aware" of its television-advertising campaign directed against Zimmerman. "This was something we felt was of consumer interest," Maurath said of a pitch for funds she said was made by the partnership.
Marauth added that she was not "personally aware" of how Public Interest Project, Inc. and the partnership got in touch with each other, but said the foundation never advertises its grants to the general public. "There would have to be some personal connection, oh, sure," she said. "We don't have a regular process by which we award grants. There would have to be some personal connection. You would definitely have to know somebody."
Are yet-to-be revealed special interests from San Diego using the two East Coast foundations to hide their contributions to the anti-Zimmerman campaign? Public Project president Donald Ross did not return repeated telephone calls to his offices in New York and Washington. Foundation boardmember Susan Stamler also did not return calls to her Brooklyn apartment. Essential Information's Mokhiber said in a telephone interview on Monday from his Washington office that he knew nothing about his group's contribution to the TV-ad buy and would "look into it" and call back. He never did and failed to return numerous follow-up phone calls. John Richard, another Washington, D.C.-based officer of the Essential Information foundation, also did not respond to repeated requests for comment.
In addition to Moores and Burnham, other major San Diego real estate players have turned up on lists of contributors to Zimmerman's foe, Julie Dubick, a partner in the downtown law firm of Seltzer, Caplan, which counts among its clients influential political players such as the Bill Evans family, owner of the Bahia and Catamaran hotels on Mission Bay. Earlier this year, the firm also represented an outfit called RNLN in lobbying the school board regarding a $16 million condemnation action against the company's property at the interchange of I-805 and Highway 52. Principals of RNLN, associates of that venture, as well as other members of the Seltzer, Caplan firm have also contributed heavily to the effort to oust Zimmerman.
Another interesting $500 donor to Dubick's campaign is Morgan Dene Oliver, a developer with previous business ties to Stanley E. Foster, the father-in-law of school superintendent Bersin. According to county records, Oliver and Foster are partners in a venture called Oliver-McMillan Foster, LLC, which in December 1997 purchased a $526,000 parcel of land at 702 Market Street, two blocks north of what later became the site of the Padres' stadium project. Ten months later, according to a deed recorded on September 3, 1998, the venture sold the property to Thomas M. McMillan, Oliver's partner, for $440,000. Oliver-McMillan later announced plans to build 56,000 square feet of "residential-entertainment-retail" space near the so-called Ballpark District, according to a November 1998 account in the Union-Tribune.
Foster and Bersin also have a real estate relationship of their own: they are partners with their wives in a venture called Otay Terminal, which owns land worth at least $10 million in several county industrial parks, including one near the Otay Mesa border-crossing, which is leased to a cross-border trucking company. Bersin and his father-in-law acquired the property while Bersin was United States Attorney and designated so-called "Border Czar" by Attorney General Janet Reno.
According to a school-district memorandum dated November 9, 1999, Bersin appointed developer Oliver, Foster, and attorney Lew Silverberg to serve on an in-house committee to advise the school district about ways to "improve our operations and real estate asset management." According to the memo, authored by district administrator Henry Hurley, "The group calculated that by selling the Education Center and the Mission Beach [school] sites, sufficient resources could be raised to fund the cost of development of a new administrative headquarters and the relocation of needed warehouse space for supply and instructional materials distribution." Based on the memo's account, the Foster group has made other recommendations about selling off school-district property.