Sharpstown Scandal and it's relevance to the Texas Speaker Race.

Older forum members will remember the early 70's scandal and it's impact on Texas politics. Why this matters now is the significant influence of outside corporate money on the last election. The representatives of that Tea Party money are now trying to have their pick for the Texas Speaker's race saying that since they delivered the votes, they should be able to choose the Speaker.http://www.statesman.com/news/texas-politics/activists-who-fueled-big-gop-wins-want-voices-1040905.html The article says Activists, but I doubt the activists are synonymous with the money.

The Tea Party is a sham front for a sad mix of corporate money and foolish, gullible voters who are allowing themselves to be used by moneyed interests that could not care less about them.

The short version of the scandal, courtesy of wiki, is below. http://en.wikipedia.org/wiki/Sharpstown_scandal

The Sharpstown scandal was a stock fraud scandal in the state of Texas in 1971 and 1972 involving the highest levels of the state government. The name came from the involvement of the Sharpstown area of Houston.
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Outcome

Mutscher, Shannon and Rush McGinty (one of Mutscher's aides) were indicted by the SEC in late 1971 and tried in Abilene in 1972. The three were found guilty of conspiracy to accept a bribe from Sharp, and sentenced to five years' probation. Sharp was also found guilty of violating federal banking and securities laws and was sentenced to three years' probation and a $5,000 fine.

Although none of the other elected officials were found guilty, the damage had already been done to the two Democrat politicians. 1972 was an election year and everyone who was remotely connected to the scandal were defeated by more moderate Democrats, Republicans or other reform candidates. Although not brought to trial, Governor Preston Smith and Lieutenant Governor Ben Barnes saw their political careers effectively ended. Smith was defeated in the primaries by businessman Dolph Briscoe of Uvalde.

The final impact of the stock fraud scandal on Texas politics occurred during the regular session of the legislature in 1973. The lawmakers, led by new House Speaker Marion Price Daniel, Jr., of Liberty, a moderate and son of a former governor, with active support from Attorney General Hill and Lieutenant Governor Hobby and with verbal encouragement from Governor Briscoe, passed a series of far-reaching reform laws. Among other subjects, the legislation required state officials to disclose their sources of income, forced candidates to make public more details about their campaign finances, opened up most governmental records to citizen scrutiny, expanded the requirement for open meetings of governmental policy-making agencies, and imposed new disclosure regulations on paid lobbyists.<3>

And the corporate bucks behind the Tea Party funding will become obvious. Sweet justice if the fake reformers get chased out of town on corruption charges.


This below is from January 18, 2010
Today in Texas History: The Sharpstown scandal breaks
http://blogs.chron.com/txpotomac/2010/01/today_in_texas_history_the_sha_1.html


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But it was deep down in the supporting material of the suit that the SEC lawyers hid the political bombshells. There it was alleged that Governor Preston Smith, state Democratic chairman and state banking board member Elmer Baum, House Speaker Gus Mutscher, Jr., Representative Tommy Shannon of Fort Worth, Rush McGinty (an aide to Mutscher), and others-none of them charged in the SEC's suit-had, in effect, been bribed.

The plot, according to the SEC, was hatched by Sharp himself, who wanted passage of new state bank deposit insurance legislation that would benefit his own financial empire. The SEC said the scheme was for Sharp to grant more than $600,000 in loans from Sharpstown State Bank to the state officials, with the money then used to buy National Bankers Life stock, which would later be resold at huge profits as Sharp artificially inflated the value of his insurance company's stock.

The quarter-of-a-million-dollar profits were, in fact, made. But they weren't arranged by Sharp, the SEC said, until after Governor Smith made it possible for Sharp's bank bills to be considered at a special legislative session in September 1969, and Mutscher and Shannon then hurriedly pushed the bills through the legislature.
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By the fall of 1971, when Mutscher and his associates were indicted, the politics of 1972 had begun to take shape. Incumbents moved as far away as possible, politically, from the "old system" and the current state leaders. New candidates came forward, some of them literally with no governmental experience, under a "throw the rascals out" banner."

CAMPAIGN FINANCE
Judge tosses out spending restrictions for speaker election
Rules on contributing money to get speaker candidates elected violate First Amendment, he says.

By Laylan Copelin
AUSTIN AMERICAN-STATESMAN
Tuesday, August 26, 2008

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U.S. District Judge Sam Sparks ruled that portions of state law restricting spending by individuals or groups on the state House speaker's race are an unconstitutional infringement of free speech.
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Fred Lewis, a lawyer and an advocate of tougher campaign finance laws, said the decision will embolden individuals and groups who had stayed in the background in the campaign for speaker.
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Election law prohibits corporations from spending money in connection with campaigns and requires groups to disclose money they spend to help get candidates elected. Whether those laws apply to spending under the speaker's statute is in question.


http://www.tpj.org/2008/08/austin-american-statesman-judge-tosses.html

I'm not sure when the tied turned but voters are so far removed from caring about corruption. And with the SCOTUS ruling on Citizens United it gets even murkier. The corporations and politicians have been successful at breaking down that wall of ownership. Voters may not like it, but somehow they have come to accept that corporation and industry buy the politicians here in Texas.

How else can you explain how Joe Driver and Linda Harper-Brown got re-elected? It's obvious that both of those corruption scandals were out on the airwaves, newsprint etc in those districts. And the voters in those districts re-elected both of them. So the majority of the voters in those districts don't care about politicians breaking ethics rules and essentially being owned by their donors. And now word comes that another republcian politician has been caught doing the same thing as Driver but on a higher scale. I'm not holding my breath on Larry Taylor being held accountable by either the Lege or his district. It seems like it's OK to cheat in Texas. :shrug:



On Perry - you know all of the stories that ran about his quid quo pro crony deals and it didn't even put a dent in his support.

I'm inclined to conclude that these are much darker times, where financial corruption barely makes a dent in the electoral voter mind-set. It would have to be something like murder or child abuse to move the voter population in this state off their incumbent support.

If Sharpston happened today with the republicans in power, it would just be a blip in the news cycle. I doubt anyone would lose their seat or their job. In fact I feel that those kinds of deals happen everyday in Texas, but the republicans are much smarter about how they launder their money. It's the corrupt Democrats like Kino Flores and Terri Hodge that get caught and convicted. And that's how they finally lose their seats, otherwise the voters in those districts keep voting them back in too.

If the SEC or the Feds bring the charges, then there may be some traction, otherwise there's no way Abbott goes after anyone in his party - no matter how egregious the charge.

Those are True words. We have the same problem with Texas judges. Witness the example of Tom Delay. Laundering checks are not really laundering money. What alternate universe have we landed in?:crazy:

Yes, our best hope is the SEC or the feds, but there are other states where this is/will be going on and there is a national hundredth monkey effect. If this gets caught in other states, we may get some traction in Texas.

The election in California gave me a lot of hope. They have similar demographics to Texas and we could catch up to them mid decade. I'm convinced that part of what is slowing us down is Republican control of the vote count, but since it is all paperless, what can we prove? :shrug: Bowen got a handle on the bad voting machine process in California and then Dems were able to win big time.

A reason I have hope even though I believe there was a lot of negative vote manipulation, were were the 2008 numbers. (I know you know all this, Sonia, but since we are blogging I'll elucidate)
http://www.usatoday.com/news/politics/election2008/tx.htm

In 2004, Shrub was awarded 4,526,917 while 2008 McCain/Palin only managed 4,467,748 a downward trend. In 2008, Dems on the other hand picked up at least 688,460 and 'others' picked up over 17K. We won all major urban areas, all the valley and a big dent in West Texas. 80 percent of the population is urban and we are making headway in those areas. If we can get our national leadership to give us something to fight for in 2010, we can turn the tide in Texas.

I have confidence The Party of "No" and the Party of corporate corruption is going to give us plenty of ammunition to run on, I just hope we have candidates and national enthusiasm and especially agenda to play an offensive game. We need to get our 50 state strategy back in place and start grooming our candidates. We need to aggressively take on the republicans now and clearly show there is a difference worth fighting for.

And the Latino vote came out strong in those two states. I'm with you. If the Texas republican party of "no" comes out guns blazing with hatred for Latinos this session, then maybe the Latino vote will finally be motivated in Texas. So far they are more than content to let the status quo be.

But we also have the mid-term voting slump to contend with. Presidential years always get more voters out and we have to find a way to get them to come out two years later too.




I miss Howard Dean's 50 state strategy. The Tea Party used Howard's play book and kicked our ass nationally.

When we pay attention to history and stop making the same mistakes over and over? :shrug: