December 15, 2017; Los Angeles Times
The Los Angeles Times reports that Consumer Watchdog, a Santa Monica-based nonprofit that is one of California’s most visible and vocal progressive advocacy groups, is funded by donors who are largely shielded from public view.
The irony is that Consumer Watchdog has a 30-plus year history of reprimanding politicians and interest groups for doing the bidding of those who fund them, especially through hidden financial relationships that can shape politics and public policy.
Some of its money, according to a Times review of tax documents, was donated by a nonprofit operated by Chris Lehane, an influential political strategist and corporate consultant. Between 2012 and 2015, Consumer Watchdog accepted $260,000 in donations from Main Street American Values, with one payment made weeks before Consumer Watchdog publicly supported one of Lehane’s clients, Airbnb.
“At the very least, by appearances it makes it look like money is driving the policy,” Jessica Levinson, a Loyola Law School professor who specializes in ethics and lobbying rules, told the paper.
Main Street American Values also donated nearly $1 million to the highly respected Tides Foundation during that time, and Tides gave a similar-sized contribution to Consumer Watchdog. Lehane told the Times that none of his funding came from Airbnb, but he declined to identify the sources of his organization’s contributions.
Lehane once served as advisor to President Bill Clinton and Vice President Al Gore, where he earned a reputation for his skill in winning tough political fights. He consulted for such large players as AT&T, L.A. Clippers owner and former Microsoft CEO Steve Ballmer, and Hollywood producers during the 2007 writers’ strike. For three years, Lehane served as one director of Main Street American Values, “an organization with no staff and a low public profile.” Lehane told the paper that he’s known Consumer Watch’s president Jamie Court and others “for a long while” and supports their projects.
In 2015, Consumer Watchdog joined a successful effort to kill legislation in Sacramento that would have imposed new rules on Airbnb and the home-sharing industry. Consumer Watchdog claimed the bill was a privacy threat that could make it easier for cities to target homeowners for things like zoning violations. Many local government and public safety groups supported the measure, and the bill’s author told the Times that “when we tried to talk to Consumer Watchdog about the facts of the legislation, they seemed quite entrenched and weren’t interested in learning more about the bill.”
Main Street American Values had given Consumer Watchdog its donation five weeks earlier, according to documents provided to the Times. The group that year also opposed similar home-sharing rules in San Francisco’s Proposition F, which was rejected by voters that November. By early 2016, Lehane had left Main Street American Values.
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As a 501c3 nonprofit, Consumer Watchdog is not required to reveal its donors. But the Times points out:
Court, who has been president since 2003, in the past has frequently advocated for transparency. In a book that year, he lamented the “growth of deception” caused by donors—in his example, corporations—to groups “who hide their identities from the public.”
Court said that “there were no specific conditions” applied to the donation Main Street American Values made in 2013, just days after he testified in Sacramento in support of drug testing for doctors, while Lehane was helping draft a ballot measure that included a drug-testing provision.
Consumer Watchdog has been a strong proponent for publicly disclosing the identities of those who subsidize policy and political fights, but Court told the Times that revealing the sources of the nonprofit’s money could scare off donors. He added that the comparison to politicians is unfair: “We are not a government official with a duty, a public duty, taking taxpayer money with public powers.”
(Last year, Consumer Watchdog filed a state ethics complaint alleging oil companies secretly funneled money to Gov. Jerry Brown’s 2014 reelection campaign.)
In the same article, the Times points out that the San Francisco-based Tides Foundation, which gives money to progressive social justice and human rights efforts, gave more than $1 million to Consumer Watchdog between 2012 and 2016. Over the same period, it received $955,000 in donations from Lehane’s nonprofit.
A Tides spokeswoman would not comment on the donations to Consumer Watchdog, but said Tides sometimes makes grants that are “recommended by our donor partners.” Lehane told the paper that he gave money to Tides because it supported “the kind of progressive policy efforts [Consumer Watchdog] was leading on.”
While the lack of donor disclosure may be legal for an advocacy nonprofit like Consumer Watchdog, said Levinson of Loyola, the perception it creates can be damaging.—Larry Kaplan