In the last few weeks, a new player entered the financial reform fray
with a $1.6 million ad buy, a respected economist on board, a blitz of
opinion columns on left-leaning websites, and a message, cooked right
into the group's name -- Stop Too Big To Fail -- that liberals could
But as TPMmuckraker has looked into the group, every indication is
that Stop Too Big To Fail is an astroturf operation funded by corporate
interests to give the appearance of grassroots opposition to reform.
The group's leader has a long history running a rent-a-front
operation: offering up his services to large corporations who are
willing to pay top dollar for a "consumers group" that will engage in
stealth advocacy on behalf of industry. The group refuses to divulge its
funding sources. The respected economist whose support the group touts
now says he was deceived. And Stop Too Big To Fail has links to DCI
Group, one of Washington's best-known astroturf operators.
Besides all that, Stop Too Big To Fail's real goal is clear: kill the
financial reform bill.
"These guys made the KGB look like amateurs, and I used to work in
Russia quite a lot," says Simon Johnson, a former chief economist at the
IMF, now at MIT, who is a prominent advocate of breaking up the big
Stop Too Big To Fail reached out to Simon Johnson earlier this month
to participate in a media conference call
purportedly on the topic of breaking up large banks. The theme was
"protecting small investors." Johnson agreed to be on the call and
outlined his views as usual, but he also noticed something seemed off.
"I thought they seemed a little different from the other people I talked
to on these issues."
Stop Too Big To Fail is now featuring Simon Johnson's picture
prominently on the landing page of their website -- and he is angry.
"I'm usually inviting the industry to come and debate with me, but
I'm not usually inviting them to come and deceive me. It's really very
interesting and sophisticated, and scary," he says, adding that he will
demand the group stop using his picture.
Simon Johnson was right to be suspicious.
Stop Too Big To Fail's $1.6 million ad campaign,
which is targeting Majority Leader Harry Reid, Sen. Claire McCaskill
(D-MO), and Sen. Mark Warner (D-VA), asks viewers
to tell their senators, "vote against this phony 'financial reform.'
Support real reform, stop 'too big to fail.'"
Part of the reason it's easy to be confused about where Stop Too Big
To Fail stands is its tactics: the group pays lip service to the idea of
breaking up the big banks while at the same time adopting "bailout
fund" rhetoric used by Republicans, all the while devoting its resources
to trying to kill financial reform altogether.
That kind of sophisticated strategy is very familiar to Stop Too Big
To Fail co-founder Bob Johnson (no relation to economist Simon Johnson).
An Indianapolis lawyer, Bob Johnson is president of Consumers for
Competitive Choice (C4CC), which runs Stop Too Big To Fail.
C4CC describes itself
as "a diverse national coalition of Americans who support a strong,
vibrant and consumer-focused economy that is united in the belief that
our country's greatest strength is its ability to dream, build, innovate
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Before C4CC was Consumers for Competitive Choice it was Consumers for Cable Choice.
That group was funded
by big telecoms like Verizon and fought to deregulate the cable
industry. Sure, Consumers for Cable Choice was a coalition that included
better-known groups like the California Small Business Association and
the League of United Latin American Citizens (LULAC) -- groups that are
still members of C4CC, Bob Johnson tells us -- but they too, had gotten
loads of telecom money, the San Francisco Chronicle reported
Before Consumers for Cable Choice, there was Consumers Voice. Founded
in the late 1990s, that was "a self-described watchdog fighting against
broadband legislation" that was funded by AT&T, according to Roll
Through Consumers for Competitive Choice, Bob Johnson also currently
runs www.simplecoverage.org, a website
funded by mega-insurer Assurant,
that says it helps people navigate the individual insurance market.
C4CC recently visited Capitol Hill to advocate
against credit card fees that are the bane of many businesses.
For all this, Consumers for Competitive Choice paid Bob Johnson
$198,000 through his law firm for "consulting and management" services,
according to C4CC's 2008 tax filings.
Partnering with Bob Johnson on Stop Too Big To Fail is Sam Zamarripa,
a former Democratic state senator in Georgia who now owns a private
equity firm and is co-founder of Atlanta's United Americas Bank.
In interviews with TPMmuckraker, neither Zamarripa nor Bob Johnson
would detail where Stop Too Big To Fail got its money. "We get grant
funding from members and organizations," said Bob Johnson, who described
Consumers for Competitive Choice as a "small operation" made up of him
and partner Jim Conran of California.
Asked directly whether the group gets money from the banking
industry, Bob Johnson said "you would have to talk with their
representatives. I have not done so."
According to Zamarripa, Stop Too Big To Fail started coming together
when Bob Johnson mentioned the idea late last year to Zamarripa, who
describes himself as a "lifelong Democrat" who knows Johnson through
C4CC. He has become the public face of Stop Too Big To Fail, making
media appearances on ABC
and, and writing opinion columns for Politico
and the Daily
In our interview, Zamarripa talked up raising capital requirements on
banks and even voiced support for Blanche Lincoln's derivatives
regulation proposal. But none of that changes the kill-the-bill message
in Stop Too Big To Fail's ads.
"This looks to me like a piece of subterfuge," said a pro-reform
operative who examined Stop Too Big To Fail's website.
One coda to all this: the man who reached out to economist Simon
Johnson about joining the Stop Too Big To Fail call was Oliver Wolf, a director
with the DCI Group. DCI is the Washington public affairs firm
that specializes in astroturf efforts and has worked for everyone from
the Burmese junta to the tobacco industry.
Wolf did not immediately respond to a call seeking comment.
Late Update: The group has now
pulled Simon Johnson's image and name from its website.