Are there Democrats in New Jersey without ethical problems?
On Monday, August 15, it will have been exactly one year since former New Jersey Governor James McGreevey announced his resignation from office. McGreevey’s resignation was inevitable after it was revealed he had placed an unqualified, former love interest as head of the state’s homeland-security department. It was another political embarrassment with serious repercussions for New Jersey Democrats following former Senator Robert Torricelli, who was caught in a financial scandal of his own and decided against running for reelection in 2002. And now there is growing evidence current senator and gubernatorial candidate <a href="http://www.newsday.com/news/local/wire/newjersey/ny-bc-nj–governorsrace-co0805aug05,0,4929133.story?coll=ny-region-apnewjersey
“>Jon Corzine can be added to this dubious list.
Over the past week, a number of financial dealings have come to light that question Corzine’s judgment and place him in a serious conflict of interest as he embarks on a campaign to further his political ambitions. Last week it was reported by several news outlets that Corzine had made an undisclosed loan of $470,000 to former girlfriend Carla Katz. That would be no one’s business except that Katz happens to be head of New Jersey’s largest union, the Communications Workers of America.
Corzine failed to report the loan on his Senate expense reports. Six months after Corzine made the loan to Katz, the Communications Workers of America endorsed his 2000 Senate campaign. Katz has refused to speak with reporters, but maintains her residence in a Corzine-rented apartment in Hoboken.
Sherry Sylvester, campaign and communications director for Corzine’s election opponent Doug Forrester, tells National Review Online that the loan calls into question Corzine’s integrity: “There is no question there’s a conflict. A half-million-dollar loan to the state’s largest labor union is a conflict. Imagine the outrage if Tom DeLay gave half a million dollars to the U.S. Chamber of Commerce. What’s more, Corzine did not disclose his loans on his Senate reports. He’s the richest man in the U.S. Senate in his own right, but won’t even reveal his financial partnerships that he promised to dissolve when taking office. All of New Jersey’s big print outlets agree Corzine’s conflicts are serious.”
Corzine has tried his best to play down the incident. First, he forgave the loan to Katz. Then, when questioned by reporters during a press conference last week, Corzine responded, “I don’t think there’s a conflict, the relationship has ended.”
But it’s not just Corzine’s political opponents who are calling the “loan” into question. Common Cause spokeswoman Mary Boyle said, “Any time that you have a sitting member of Congress giving half a million dollars to a union president, even if it’s personal to a girlfriend, it’s going to raise questions.”
So, what is the conflict of interest seen by both the Forrester campaign and Common Cause? If elected governor Corzine would oversee salary negotiations for 9,000 state workers, would help facilitate state pension benefits and could influence the level of accountability demanded from New Jersey’s child-welfare workers. Corzine’s critics question whether he could be an honest negotiator after maintaining a romantic relationship with the state’s largest union boss and giving her half a million dollars. To those critics, the assertion that his relationship with Katz has supposedly ended is irrelevant.
New Jersey GOP Chair Tom Wilson said in a statement, “This is Jim McGreevey all over again. When the private affairs of an elected official impact his public duties, the public has a right to know all the relevant details. The nature, timing and extent of the financial relationship between Carla Katz and Jon Corzine are relevant details that Mr. Corzine seems afraid to share.”
Corzine has also come into question for maintaining lucrative financial dealings since he entered the Senate. When Corzine took office, he promised to put his Goldman Sachs holdings into a blind trust. However, it has been reported that Corzine has been an active participant in the so-called “blind trust,” continuing to make changes to his economic portfolio when his personal involvement was to have been liquidated. As the Republican National Committee’s Danny Diaz tells NRO, “Corzine is a guy a lot of Democrats tried to look to as their golden boy. But there are still questions about his $470,000 gift to ex-girlfriend Carla Katz, his financial connections to the largest union in the state and his hedge-fund investment.”
Corzine’s hedge-fund investment is with Carl Icahn, head of Ichan Partners LP, a state casino operator. Despite repeated requests, Corzine is refusing to answer questions about who his financial partners are in the deal. What is known is that Corzine has $7 million invested with Ichan but has promised to dissolve his interests if elected governor. Which brings up the question: Will any of Corzine’s conflicts of interest have a negative impact on his gubernatorial campaign?
A new poll released by Quinnipiac University shows Corzine leading Doug Forrester 50 to 40 percent. Amongst independent voters, Corzine leads by only one point, 43 to 42 percent. And the two are tied on the question of who could better handle state property taxes, the most pressing issue cited by respondents in the Quinnipiac poll. However, near the bottom of concern for voters are questions related to political corruption and personal accountability, which each measured in only three percent of voters’ concerns.
At this point, Corzine still has to be considered the favorite to win New Jersey’s gubernatorial race. After all, the conflict-of-interest accusations surrounding his personal investments are not likely to be resolved before the election. If Corzine remains free to spend independent of the restrictions placed on other candidates he will have an even greater financial advantage over Forrester in an already Democrat-leaning state. But for New Jersey Democrats, it’s yet another political embarrassment that could have significant repercussions not just for their party, but for the financial future of thousands of New Jersey voters.
–Eric Pfeiffer writes the daily political “Buzz” column on NRO.