AG Cox has major issues before 2010 Gubernatorial race

Michigan’s Republican Party 2010 Gubernatorial frontrunner, Attorney General Mike Cox, has major problems that don’t involve any of the other GOP Gubernatorial candidates. Now when Secretary of State Terri Lynn decided to drop out of the 2010 gubernatorial race and endorsed Oakland County Sherriff and former U.S. Senate candidate Mike Brouchard, it made a lot of Republicans in the state wonder why aren’t the top guns supporting Mike Cox. Well the answer could be the fact that Mike Cox names keeps getting mentioned in linkage to not doing a proper investigation of the alleged Manoogian Mansion party cover-up and the fact he had an affair could be reasons why many conservatives are not outright giving their endorsement to Cox.

Still, Democratic Party Chair Mark Brewer probably said it best by having a batty conniption after seeing Republican Attorney General Mike Cox's 92-point plan (yeah, I know, he really is trying too hard already) to better Michigan's fortunes. "Cox should be focusing on a two-step plan," Brewer said. "First, he needs to explain how, as governor, he would be different from South Carolina Gov. Mark Sanford. Second, Cox needs to practice what he preaches and fully disclose his role in the Manoogian Mansion party cover-up."

Then to add misery to Cox’s fortunes is the fact that although he is calling for more ethics and transparency in Michigan’s legislature, it seems that his idea or support for it doesn’t go far enough in revealing a certain types of funds that Cox uses frequently and often. On Aug. 27 Michigan Attorney General Mike Cox chose Detroit to hold a press conference on campaign finance reform. Cox, who plans to run for governor next year, offered a legislative proposal requiring personal financial disclosure for elected officials — one aspect of political financial reform.

He did not, however, denounce 527s. Using that method of campaign funding, Cox has raised $964,554 since 2004, according to Campaignmoney.com. The 527 fund is a secretive administrative account that receives virtually unregulated funds. It is a separate treasury from campaign finance funds or political action committees. His election campaign committee has raised over $5 million that is in addition to the 527 fund. While campaign committee’s finances are more closely regulated, the 527 money can be spent for office seeking and holding expenses including travel.

Of the nearly $1 million raised in his 527, Cox has spent a total of $539,277 for items ranging from area rugs for his office ($1,897), to travel reimbursement for his wife, Wayne County Commissioner Laura Cox ($987), to reimburse himself for parking costs ($3,729), to buy office furniture ($4,964), treat staff to a dinner at a Minneapolis, MN, steakhouse ($3,960) and pay his airline bill to Northwest Airlines ($19,567). Cox’s 527 account has received tens of thousands of dollars from almost all the state’s major corporations and business associations, raising conflict of interest questions with his official duty to provide legal representation for all state departments.
“With a 527 you are in a territory where it is less convenient for people and the press to monitor campaign contributions,” said Rich Robinson executive director of Michigan Campaign Finance Network. “Won’t it be great when the Governor, Attorney General and Secretary of State file their reports with IRS they also issue to the press a copy of their 527 report?” Now according to The Center for Responsive Politics (CRP), 527s are tax-exempt organizations that “engage in political activities, often through unlimited soft money contributions … Some, such as the Republican Governors Association and the Democratic Governors Association, spend money to support or oppose the election of state candidates. 527s must report their contributors and expenditures to the IRS, unless they already file identical information at the state or local level.”

The 527 accounts require a semi-annual report to the IRS but finding the report is not a simple task, Robinson said. “It [the 527] puts him in an awkward position; I’m not sure it makes his job impossible to do,” Robinson said, commenting on the potential for conflict of interest questions arising from the donations. The conflict of interest charge rises because Cox’s office represents all the state agencies which regulate business activities of many of his donors from roads to insurance to issuance of bonds.

One of Cox’s biggest donors was Blue Cross Blue Shield (BCBS), with a $15,000 donation in 2008 and another $36,000 between 2005 and 2007. As AG, Cox oversees insurance regulation. In 2009, BCBS hiked its insurance rates almost 25 percent. According to a press statement, Cox opposed BCBS’s original rate hike request which could have meant an 80 percent increase. That is a hollow victory for many consumers who see any double digit increase as bad news for Michigan, a state struggling in this economy. BCBS insures at least 200,000 people in Michigan.

Bank and mortgage lenders Citigroup Business Services and American Servicing (a subsidiary of Wells Fargo), and Trott & Trott (the local law firm representing most mortgage companies on foreclosures) also donated to Cox. In other states, the AG has figured prominently in slowing foreclosure rates and preventing predatory lending. Other than holding an information session for homeowners facing foreclosure at Cobo Center, Cox has done little and Michigan foreclosure rates are among the nation’s highest.

Money makes a difference in politics, Robinson said. “Money has a lot to do with what happens. Money plays offense and money plays defense.” The two highest donors to Cox’s account in 2008 were The Jackson Life Insurance Association and Blue Cross-Blue Shield. DTE was third, contributing $12,000. Numerous other individual insurance companies also contributed. Other utilities that contributed tens of thousands during the 2004 through 2010 cycles included AT&T, Consumers Energy, SEMCO Energy Gas Company, and Comcast.

Business associations which contributed during those cycles included the Michigan Paving and Materials Association, the Michigan Retailers’ Association, the Michigan Petroleum Association, the Michigan Insurance Coalition, the Michigan Beer and Wine Wholesalers Association, The Michigan Restaurant Association, The Michigan Health and Hospital Association, the Pharmaceutical Research and Manufacturers Association, and The Michigan Chamber of Commerce.

Microsoft, Moceri Construction, Reynolds American (the parent company of R.J. Reynolds Tobacco Co.), Waste Management of Michigan, and Manny Lentine, Inc., whose state documents give no indication of what business he conducts, were among miscellaneous other companies who fattened Cox’s slush fund. Still Cox only problem isn’t the campaign finance slash ethics and transparency issue but it is also the fact that he is about to represent Emergency Financial Manager for Detroit Public Schools in a lawsuit against the school board over the appointment of Teresa Gueyser as General Superintendent rather than acting superintendent and another regarding Bobb’s unchecked authority as EFM.

Attorney General Mike Cox has declared it is not a conflict of interest for him to represent Detroit Public Schools czar Robert Bobb. Cox is defending Bobb in a lawsuit brought against him by the Detroit Board of Education and a countersuit filed by Bobb, related to the Board’s designation of Teresa Gueyser as General Superintendent. “Cox said that his office will serve as Bobb’s counsel because Bobb is a public officer appointed by Gov. Granholm under state law and because Bobb made a request for representation,” said the Michigan Department of Education in a release.

Bobb, however, is paid by the Detroit Public Schools, not the state. The Michigan Chamber of Commerce (MCOC) said in a 2005 policy report that an Emergency Financial Manager is not a state employee. “The Emergency Financial Manager (EFM) should become an employee of the Michigan Department of Treasury,” said the MCOC. “Costs would be borne by the state (not the insolvent local unit); this would provide the EFM with access to the legal staff of the attorney general and make the issue of indemnification moot (currently the EFM can be sued personally in harassing lawsuits filed by affected persons).”

Now my problem with Cox representing Bobb in the suit that Bobb is filing over the appointment of Gueyser is that even if Cox and Bobb wins, Gueyser is still going to be acting superintendent and she will be getting paid for doing nothing. Gueyser stepped in as acting superintendent when the Board removed Connie Calloway as superintendent last year and since that time, no one can explain what has Gueyser done as acting superintendent and even when Bobb arrived in March it seems that Gueyser was just a figure head who Bobb didn’t even allow to many of his meetings until after the acting title was removed by the Bobb. Thus Gueyser’s title as acting superintendent was removed and she was given the title of superintendent and one of the first things she was charged to do was investigate the appointment of Mumford’s new principal Mario Morrow that Robert Bobb had made. Now school board member Marie Thornton questions the principal position at Mumford High School of Morrow, former DPS spokesman, because he was appointed an assistant superintendent, yet he will be serving as principal of a high school. Thornton raised questions of whether Marrow met the qualifications to act as principal.

Nonetheless, it seems as if another issue regarding the fact that Cox is representing Bobb is that Bobb is not paid by the state thus he is not an employee of the state although he was appointed by the state as EFM. If you look at the history of EFM’s across the state of Michigan, most are usually paid by the state but Bobb isn’t paid by the state but by a private entity called Eli Broad and the Broad Foundation. Therefore it seems as if Mike Cox continues to stick his foot in his mouth before 2010 hits and the governor’s race is really light years away to a degree. Nonetheless, all of this information just gives other GOP contenders a chance to win the Republican nomination for Governor because someone can be a front runner in September of one year and gone by the September of the next year, just ask Hillary Clinton and Rudy Giuliani. Thus, Mike Cox strategy of rolling out ideas and plans while putting his hands in Detroit as much as possible might have seemed like a good idea but so far, it can adds to the speculation that Mike Cox might not be the right fit for the Republican Party as they try to obtain the Governor’s mansion back for the first time since 2002. Time will tell all but the closer 2010 gets, the more bad news continues to roll out regarding Attorney General Mike Cox.