The Arizona group that dumped $11 million into California's ballot measure melee this week is led by a Republican activist who calls labor unions "the parasite that is killing our jobs."
Robert Graham, a candidate for Arizona Republican Party chairman, helms Americans for Responsible Leadership, a little-known group that delivered $11 million to a committee fighting a tax increase on November's ballot and supporting a measure that would weaken the political clout of unions. The money will either go toward opposing Proposition 30, Gov. Jerry Brown's tax measure, or supporting Proposition 32, which would ban the use of payroll-deducted dues for political purposes.
Americans for Responsible Leadership was formed last year by three Arizona businessmen, including Graham. The other directors are Eric Wnuck, who ran an unsuccessful campaign in the Republican primary in a 2010 congressional race, and Steve Nickolas, a bottled water entrepreneur.
"These are not household names even to politicos like me," said longtime Arizona political analyst Michael O'Neil. "This is not the political A-team."
O'Neil added: "It sounds like they are a front organization, and the real question is where do they get their money from."
The group is organized as a nonprofit organization that doesn't have to disclose its donors. The group's directors did not respond to requests for comment.
Beth Miller, spokeswoman for the Small Business Action Committee, which received the $11 million donation, said the committee does not know who funds the group.
"You’ll have to ask them as to where their funding is coming from," she said.
Americans for Responsible Leadership has also injected money into two of Arizona's ballot measures this year. It gave $500,000 to oppose a 1-cent sales tax for education funding. And it spent $75,000 to oppose a measure that would create an open primary system where voters could vote for candidates of any party and the top two vote-getters would advance to the general election. California has a similar top-two system that voters approved in 2010.
"Outside special interest groups are trying to take away our freedoms," Graham said in a video opposing the top-two initiative. "Do you want California politics in Arizona? ... I don’t want Arizona to have to deal with the same mess California is in."
Graham, who has a wealth management company in Scottsdale, is running to lead his state's Republican Party with a pledge to "respect the grassroots conservatives and Tea Party members who have infused our Party with energy and recommitment to conservative ideals."
Graham also ran an unsuccessful campaign in the 2010 Republican gubernatorial primary, as a relative unknown. He has a company called Freak Show Racing. And he is the author of "Job Killers," a book about "How Labor Unions are Destroying American Jobs and the Economy."
"Striking labor unions out of the business model is imperative to the economic success of today’s ever-changing marketplace," he said in a video promoting the book. "Then, and only then, will we truly be able to free ourselves of the parasite that is killing our jobs."
Labor unions in California are pouring tens of millions of dollars into the same state ballot measures that Americans for Responsible Leadership is targeting – but on the opposite side.
The California Teachers Association and the Service Employees International Union combined gave $16.5 million to Prop. 30, the governor's tax increase, according to campaign finance tracker MapLight.org. The two labor giants also gave $32 million to defeat Prop. 32.
Unions have much at stake. While Prop. 32 prohibits both labor and corporations from using payroll deductions for political purposes, critics say it would disproportionately hit unions, which commonly use member dues to finance robust political operations.
A new report by public policy group California Common Sense found that labor unions fund far more independent expenditures in state political races than other sectors.
Special interests can spend unlimited money on political ads if they are independent of candidate campaigns, and such expenditures have shot up over the past 12 years. Since 2000, unions spent $90 million in this way, compared with $27.7 million by the business sector, according to the report.
Businesses, however, tend to outspend unions when it comes to direct candidate contributions, said report co-author Mike Polyakov.
"I think the influence that money generally and independent expenditures specifically have on our political system is something that should cause concern to the public," Polyakov said.
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This story was produced by California Watch, a part of the nonprofit Center for Investigative Reporting. Learn more at www.californiawatch.org.