A consumer group that supports Mercury Insurance in its efforts to charge some drivers higher rates just got a donation of $195,000 from Mercury's founder. The money is going to create a political operation supporting two ballot measures – Mercury's Prop. 33 and Prop. 38, a tax measure sponsored by Molly Munger, who also gave the group $225,000.
Greenlining Institute, which has the mission of protecting low-income people from predatory financial institutions, defends its stands. But since the group opposed a very similar Mercury measure two years ago, critics are wondering how much Greenlining is influenced by its corporate donors.
Just as the Guardian was going to press last week with a story about the strange alliance between Greenlining and Mercury to back Prop. 33, which would increase car insurance rates for those who haven't maintained continuous coverage, that connection got far cozier and more lucrative for Greenlining.
Greenlining's General Counsel Sam Kang – the main proponent for backing Prop. 33, a stand that was controversial within the organization – has taken a sabbatical until Election Day to support the Yes on 33 campaign using a $195,000 donation that Mercury founder George Joseph made a new 501c4 offshoot organization: Greenlining Action.
Before the Guardian independently learned of those new developments, Greenlining Executive Director Orson Aguilar contacted us about writing a response to our article, which we welcome, although he hasn't followed through yet. “Regarding the article, I think it was fair given your early conclusion that $25k led to our decision. Clearly we have issues with that, but enough said,” he wrote to us.
I disputed the characterization that my article implied the $25,000 donation from Joseph to Greenlining was the deciding factor in the organization's decision to support Prop. 33 after opposing a similar measure in 2010, but Aguilar sounded a similar criticism in a piece he posted to Greenlining's website on Sept. 6 entitled “Check the Facts and Support Prop. 33.”
“Simply put, Proposition 33 is good policy that will lead to lower rates by encouraging more competition among insurance carriers in California,” Aguilar wrote, a disputable claim that Kang offered. “You may have also heard that Harvey Rosenfield, the founder of Consumer Watchdog, is attacking Greenlining for supporting Prop 33. Harvey claims that a $25,000 table sponsorship by Mercury Insurance at Greenlining’s 2012 Annual Economic Summit led to our support of Prop 33.”
Actually, Rosenfield hadn't made that claim in the Guardian article that Aguilar referenced in his write-up, nor did he acknowledge the $195,000 donation that Greenlining Action received from Joseph on Sept. 4, two days before posting his open letter minimizing the impact of a $25,000 contribution.
I asked Aguilar why he didn't mention that hefty donation, or the fact that Kang had taken a long sabbatical to do campaign work (which I learned of by an auto-response to his email about the sabbatical that also said “If your note is regarding Proposition 33, please call my cell phone”), or asking about Kang's current financial arrangements and possible conflicts of interest.
Aguilar responded with a high-minded announcement of Greenlining Action: “This November, voters will have a chance to pass tax measures that ensure that schools and colleges have enough money to serve our students. Other propositions would make common sense reforms to California’s system of incarceration – saving the state millions in dollars while keeping us safe. Another proposition would give large corporations unlimited influence over California politics and must be defeated. Another would bring lower auto insurance rates for families working from paycheck to paycheck.
“As an organization, we decided not to sit on the sidelines any longer. In our work listening to hundreds of working-class voters, they demanded more concise and accurate information on initiatives from a trusted reliable source.
“Greenlining Launches Greenlining Action
“We have decided to take action by re-launching a c4 organization, Greenlining Action. Greenlining Action was originally launched several years ago when we unsuccessfully tried to freeze tuition at the University of California by imposing a tax on millionaires. Unfortunately, we came up a few hundred thousand signatures short to qualify our petition for the ballot. This year we have developed an initiative slate with recommendations on all ballot measures. Our hope is to put this slate in the hands of thousands of voters this election.”
So far, Greenling Action is only listed in campaign filing documents as officially advocating for two measures: Prop. 33 and Prop. 38, which would raise taxes to help fund public education, whose chief sponsor, attorney Molly Munger, also gave $225,000 to Greenlining Action.
Consumer Watchdog founder Harvey Rosenfield said he finds the dual roles played by Kang (who could not be reached for comment) unseemly, particularly if he's being paid to work on the campaign: “To use the name of the nonprofit to further your personal interests, that's personal inurement.”