McConnell Raised Big Bucks From Foreign Defense Contractor Probed For Bribery

February 3, 2010 8:15 am

In the wake of the Supreme Court’s Citizens United ruling, Sen. Mitch McConnell (R-KY) has been quick to denounce a bid by Democrats to stop foreign corporations from pouring money into U.S. elections, claiming current law already bars such spending. As we’ve reported before, it’s not nearly as simple as that — but McConnell should know: The GOP Senate leader has raked in campaign cash from a subsidiary of a major foreign defense contractor that’s currently being investigated by the Justice Department for bribery.

As we reported yesterday, McConnell, a longtime foe of efforts to get money out of politics, last week took to the Senate floor to pooh-pooh the notion that the court’s decision could allow a flood of foreign money to sway our elections, citing an existing law that prevents foreign nationals, including corporations, from spending on U.S. elections. But that ban doesn’t cover the U.S. subsidiaries of foreign companies, or to foreign-owned corporations that incorporate in the U.S.That’s not just some technical loophole. Democrats and campaign-finance reform advocates argue it’s a very real weakness in the law, that, even before Citizens United, gave foreign corporations influence in our elections. And McConnell’s own ties to one foreign defense contractor offer a pretty good illustration.

Since 2005, McConnell has received $21,000 — spread between his campaign and his leadership PAC — from a PAC run by BAE Systems Inc., according to federal campaign disclosure records examined by TPMmuckraker. BAE Systems Inc. is the American subsidiary of BAE Systems, the world’s second largest defense contractor, headquartered in Britain.

In addition, United Defense Industries, another defense contractor bought by BAE in 2005, reportedly pledged half a million dollars to the McConnell Center at the University of Louisville, a political science foundation that the senator created.

McConnell has been good to BAE, which owns a facility in Louisville, Kentucky. For fiscal year 2010, the senator requested earmarks for the company worth a combined $17 million.

BAE is hardly a squeaky clean corporate citizen, either. The Justice Department is conducting an ongoing investigation (pdf) into allegations that the company bribed members of the Saudi Royal family, including the Saudi Ambassador to the United States, in support of a mulit-billion dollar, decades-long deal to barter arms for oil.

To be sure, as election lawyer Kenneth Gross points out, the existing law does make it illegal for foreign corporations to “funnel foreign corporate funds through domestic entities or to have foreign officers, directors, or employees direct foreign or domestic funds with regards to federal, state, or local elections.”

But in practice, reform advocates argue, this prohibition doesn’t get to the root of the issue. Even if a U.S. subsidiary uses its own funds to contribute, and the decision to contribute is made only by Americans, the money nonetheless comes from a subsidiary of a foreign corporation, whose officers can hardly be expected not to act with that interest in mind.

McConnell’s office did not immediately respond to a request for comment.

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