Rich Upper East Siders Are Spending Millions to Mess With Elections in Brooklyn and the Bronx

A new super-PAC is spending millions of dollars to oust four labor-backed black and Latino state Democrats from the Bronx, Brooklyn, and nearby Suffolk County. But most of the $3.17 million campaign, which has already begun to flood the Bronx with mailers, has not been financed by local organizations or concerned constituents. 

Of New Yorkers for Independent Action’s sixteen donors, all have addresses listed outside Brooklyn, Bronx, and Suffolk County, according to the New York State Board of Elections. All those registered in New York list addresses on the Upper East Side and in midtown. And all of the super-PAC's donors appear to be white.

The group's main issue has been advocating for an education tax credit, which would give tax rebates to donors and companies for donations to private and parochial schools and has long been opposed by most state Democrats.

Supporters of the school tax credit, such as the Catholic Church, describe the program as a way to give low-income students greater school choice. Critics, such as the teachers union, are concerned that the campaign will open the door to vouchers and allow millionaires to get unfair tax breaks.

“The flood of big money into state legislative races has been happening over the last few cycles, especially from the hedge fund and real estate industries,” says Karen Scharff, executive director of Citizen Action, a group that advocates public financing of elections. “But this scale of involvement from super-PACs in Democratic primary races in less well-off districts is relatively new.”

Most of the other donors outside New York list addresses in wealthy enclaves popular with Wall Street commuters, such as Greenwich and Westport, Connecticut. The address farthest away from New York belongs to Alice Walton, the Walmart heiress worth $35.3 billion, who listed a residence in Bentonville, Arkansas.

Scharff argues the spending is an attempt to maintain the financial industry’s influence in Albany, which helped flip the New York senate Republican last cycle. “They see the Democrats keep blocking their legislation and the writing on the wall.... There’s a pretty good chance Democrats are going to take back the state senate, so they want corporate supporters on their side.”

Thomas Carroll, New Yorkers for Independent Action’s treasurer, did not return the Village Voice’s requests for comment.

The state teachers union’s affiliated PAC has given money to fend off some of the attacks, spending $85,048 in recent days to defend Brooklyn Assemblywomen Pamela Harris and Latrice Walker and Suffolk County Assemblyman Phil Ramos.

"The onslaught of the materials has already started — we usually don’t see stuff starting so early in the primary,” says Natasha Capers, a coordinator with the NYC Coalition for Educational Justice and a lifelong resident of Brownsville, which is represented by Walker. “But the teachers union, the Fight for $15, those folks live and work in our neighborhoods, versus those folks on the other side have probably never stepped into Brownsville."

Michael Kink of the labor-backed research group the HedgeClippers, says that the super-PAC’s school tax credit focus is just a proxy campaign for fighting larger issues, such as a rise in the minimum wage and greater taxes for Wall Street. 

“The education stuff is only a small piece of what these guys are looking for," Kink said. "These four targeted lawmakers are among the hardest fighting for a $15 minimum wage and closing tax loopholes for hedge funders. So they can claim this is about schools, but it's really about the money.”

Kink's group recently put out a paper highlighting several of New Yorkers for Independent Action’s big donors, whom it argues are not representative of the communities whose elections they are pouring money into.

Roger Hertog, who donated $150,000 to the PAC, is chairman emeritus of AllianceBernstein, an asset management firm that holds a $4 million stake in private prison operator GEO Group as of its last filing with the SEC. GEO Group has made million off of its prison and immigrant detention center operations, despite allegations of inmate abuse and maltreatment.

Peter Grauer, who donated $75,000 to the PAC, is chairman of Bloomberg LP and currently serves on the board of the Blackstone Group, the world’s largest private equity real estate firm. Blackstone has attracted criticism for its actions after the foreclosure crisis, which disproportionately hurt black and Latino communities. Last year, Grauer made news for being one of only three UNC trustees who voted to keep a university hall named after a notorious KKK leader.

Sean Fieler, who donated $75,000 to the PAC, is a hedge fund manager and one of Wall Street’s top political donors. Fieler has also funded scores of anti-LGBTQ and anti-abortion-rights causes. Last year, Fieler gave $200,000, more than any other donor, to defeat California’s transgender-students'-rights law.

Walton donated $450,00 to the PAC. Walmart has been a strong opponent of the Fight for $15 and attempts to unionize the retail sector.

Other donors highlighted in the list include private equity moguls such as Russell Carson and Robert Niehaus.

“I don’t think this [outsider spending] has permeated down to the ground level,” says Capers. “Most people aren’t thinking about who's funding a candidate, but we have to start, because more and more folks not from Brownsville are coming in and taking up vested interests here. The fact that they’re trying to insert themselves into these races is not about some love for the Bronx or Brooklyn.”


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