Government in Cahoots with its Own

To paraphrase F. Scott Fitzgerald's observation about the rich, "Even when (politicians) enter deep into our world or sink below us, they  still think they are better than we are."  Sad to say, that may be true.

So habituated have ordinary citizens become to government sleaze that news about the next political scandal barely raises an eyebrow.

Consider that at least five Philadelphia Democratic elected officials recorded accepting cash and gifts in a sting operation remain unindicted and in office because Pennsylvania Democratic Attorney General Kathleen G. Kane refused to bring charges.  Imagine the fate of the common man in similar circumstances.    

There are countless ways (each outrageous in its own way) for the politically connected to tap into “other people’s money."

A December Huffington Post report that a charity run by Pennsylvania Democratic congressional candidate Marjorie Margolies “has spent an unusually large proportion of its revenue on her own salary and benefits, much of it paid for with taxpayer dollars” is a textbook example of the  government in cahoots with its own.       

Margolies is campaigning to regain the Congressional seat she held from 1992 to 1994.  She is Chelsea Clinton’s mother-in-law.  She has friends in high places.    

Margolies founded Women’s Campaign International in 1998 and has served as its president and as a board member since.  Its mission is to empower women in emerging democracies around the world.  

In its April 5 follow-up to the Huffington Post piece, the Philadelphia Inquirer reported that Women’s Campaign brings in about $1.4 million a year, mainly through “government grants.”

But the story behind the story are these “government grants” (i.e. taxpayer dollars) as WCI funding sources and the percentage of revenue going to Margolis rather than putative beneficiaries.    

According to the Huffington Post, two of the project’s early grants came from the Department of Defense, “arranged” by then-Rep. Jack Murtha (D-Pa) and $600,000 from the Clinton administration’s U. S. Agency for International Development.  In 2011, a $558,528 grant from USAID (according to Margolies “the largest grant we had ever gotten”) coupled with $127,076 from the State Department comprised 67 % of WCI’s $1.033 million revenue from contributions and grants.  It’s nice to have friends in high places.  

Margolis’ pay and benefits fluctuated between 2009 and 2011, from a low of $116,000 in 2010 and $164,000 in 2011(see “largest grant...” above), on top of the between $78,000 and $100,000 paid to full-time executive director, Kerri Kennedy.  Sandra Miniutti, vice-president of the charity evaluation group Charity Navigator, told HuffPost that it’s unusual for a charity WCI’s size to have both an executive director and president.

In 2009, for every dollar WCI took in, nearly 30 cents went to pay for either Margolies’ or Kennedy’s compensation and another 40 cents on the dollar went to other salaries and benefits, leaving less than 30 cents on every dollar given going toward “empowering women.”  Non-profit watchdogs recommend that donors contribute to organizations that put about 75 % of total spending into programs.       

Someone got the memo.  Between 2010 and 2011, the charity went from putting 58% of its total spending on programs to 96%, “aided, “according to IRS filings, “ by listing all the top earners’ salaries as program expenses, rather than saying part of that funding went to their management and fundraising work, as was done in 2009 and 2010.”   

This accounting legerdemain ensured that Margolies’ and Kennedy’s pay checks kept coming while ensuring that the group’s financials looked good to donors and prying eyes.  Margolies announced for Congress in May, 2013.     

Margolies told the Inquirer that she does not vote on her compensation. True, but her friends on the board do.

She says she has done nothing wrong. Perhaps she’s right.

Perhaps what’s wrong is that she done nothing wrong.