How much do you really know about Art Pope?
Pope has been a fixture in North Carolina conservative politics since the 1970s, pouring millions into political and conservative organizations, campaigns and programs promoting libertarian programs at North Carolina universities. Now, as Governor McCrory's Budget Director, Pope has a direct role in our state government. Many McCrory appointments have direct and indirect connections to Pope or one of his foundations and political action groups.
I'll be putting up a series of blog posts about figures in the McCrory administration and legislature with unanswered questions that liberals and progressives should be asking about our new Republican public officials. Winning elections is more than just getting feet on the ground or participating in a protest - it's also about research, strategy and holding public officials accountable.
Let's start with the one man who has taken this lesson seriously.
James "Art" Pope, North Carolina's newly appointed Budget Director, heads up the Office of State Budget and Management. Governor McCrory calls Pope his "assistant budget director", minimizing Pope's role and declaring that the Governor himself is the "state's budget director".
However, the Office of State Budget and Management is a government agency that does much more than just keep books and pay the state's bills. There's more responsibility to Pope's new job that the simple title of "Budget Director" implies.
The OSBM prepares statistical information, such as revenue and expenditure projections used by agencies and the legislature for budget planning. These analysis include reports that estimate the economic and budget impacts of rule changes or changes in legislation and policy. The OSBM also manages and sets policies for auditing of state agencies and issues memos for the management of agency budgets. (For example, this one noting reporting requirements to Pope's office for the budget cuts that agencies will make to meet the 2% budget cut enacted by the legislature.)
Pope's office is a central "hub" of North Carolina state government for funding. The agency prepares information used for creating budgets for state government and, through policies and memos, determines how spending will be carried out and accounted for throughout the state government.
With Pope's well known record of conservative advocacy on a wide range of policies that impact how state monies are spent - everything from what programs are emphasized or cut in schools and universities to contracts for building highways and infrastructure - and his direct support of campaigns of state legislators that own businesses themselves, Pope's positions raises unique questions about conflicts of interest.
Like other members of the legislative and executive branches of the state government, Pope, as NC's Budget Director, is required to file a Statement of Economic Interest with the North Carolina State Ethics Commission. Under the State Government Ethics Act, these Statements are a matter of public record.
It's a bit ironic that Pope's conservative Civitas Institute has a website, Carolina Transparency, that publishes pdf files of the Statements of Economic Interest filed by members of the NC House and Senate - but not those of members of the Executive Branch. And, while some other features of the site were updated for the 2012 election, the SEIs only cover 2010 and 2011. (We'll give them the benefit of the doubt on this one - perhaps they've just not gotten around to it yet.)
But, we're in luck - IndyWeek put the SEIs of several McCrory administration officials online in early February. (You can download them as pdfs from the sidebar of the story.)
One of the items that will strike you right off the bat when reading Pope's SEI is that he is distancing himself from the national and state political organizations he has financed and led for the past few decades. Pope lists the following as organizations where he was on the Board of Directors in 2012, but not in the current calendar year.
- Americans for Prosperity
- Americans for Prosperity Foundation
- Golden L.EA.F.
- John Locke Foundation
- John William Pope Civitas Institute
- NC Free Enterprise Foundation
- NC Institute of Constitutional Law
- NC Institute of Political Leadership
- Real Jobs NC
In 2008, Facing South noted that Pope provided 80% of the funding to the top five conservative political groups in North Carolina and that support has increased and expanded significantly since that time. It will be curious to see what these groups do now that their main benefactor is in public office. Over the years, they've funded many candidates now serving in the NC state legislature and have advocated for causes that legislators and Pope himself have a vested interest.
Distancing himself from these groups is a prudent move, legally. However, we all know that "good old boy" networks die hard, especially if mutual back-scratching is involved.
Liberals and progressives need to keep an eye on the activities of Pope's foundations - the people they fund or come in contact with and how they intersect with the business of the legislature or audits and reporting done by Pope and his staff at the Office of State Budget and Management.
And we need to keep a close watch on appointments and changes to policies and procedures in the OSBM. It wouldn't be a shock if Pope stayed in the position of Budget Director just long enough to "clean house" and bless a successor before returning to the work with his foundations before the next big election in the state, particularly if it looks like his Tea Bagger candidates are running into problems or the public isn't "sold" on Pope's conservative ideas.
More difficult to determine are some of Pope's financial interests that might run afoul of ethics laws.
If you're like many observers of NC politics, you know that Pope inherited the family business, Variety Wholesalers, which owns Roses, Maxway and other "dollar" stores. Pope's SEI lists several other sources of income including interest and dividends from investments, banks and brokerage funds. Pope is also a limited partner in a couple of private equity funds and has financial investments in Joyce Foods and a similar business a member of his family runs on the coast of North Carolina.
And that's what strikes me as rather odd about the whole thing. His major income would still seem to come from Variety Wholesalers.
According to various websites on companies in the US, the estimated annual revenue for Pope's Variety Wholesalers is anywhere from $500 to $700 million. (When Variety Wholesales bought Rose's Stores in 1997, that chain's annual revenues were $1 billion, btw.)
Keep in mind that's revenue, not profit. Estimates vary with the type of establishment, but retail businesses operate with a profit margin of 7% on sales and that figure can often be lower in the "dollar store" sector. A good guess with limited information is that Pope probably brings in around $35 - $50 million in profit from Variety Wholesalers each year.
But consider that Pope has given a couple of million each year to each of several of his foundations among other political donations. He might be spending $6 to $10 million or much more each year in political activity alone, a good 20 to 30 percent of his income from Variety Wholesalers.
Compare that to the Koch Brothers, who coordinate with Pope on Americans for Prosperity and other Tea Bagger political groups, who have about $98 billion in revenue yearly from Koch Industries. The $100 million they're estimated to spend in a typical year on politics is a drop in the bucket of their net worth.
Are Pope's investments outside of Variety Wholesalers is considerably more than he's letting on? Or is Pope so inflated with his own ideas of how the government should work (or, more accurately, shouldn't work), that he's willing to stake a considerable part of his fortune on proving he's right?
If it's the latter, it seems like a large investment in getting even with all the politicians who thought he was a nutcase when he was a member of the legislature in the late 1980s.
Pope probably doesn't need the money that the job of Budget Director provides. The Koch brothers and other big money conservatives seem content to stay on the sidelines as their foundations and third parties carry out the policies they advocate. But not Art Pope.
Was Pope's appointment to the job of Budget Director more of a symbol to stroke Pope's self-image as a budget-cutting government revolutionary and "hands on" libertarian? Or is there really more going on here?
Liberals, progressives, and anyone who cares about transparency and accountability in North Carolina government need some clearer answers to these questions. The Constitution guarantees freedom of speech and, with the ruling on Citizens United, the Supreme Court has equated free speech with the freedom to spend money on politics in just about any way you want to. If you are a private individual or even a corporation, that is.
Our elected officials and government employees serve us, not themselves, and any hint of ethical wrongdoing needs to be examined closely.
If you find a specific ethical concern or conflict of interest about a North Carolina public official, you can file a complaint with the NC Ethics Commission. But don't forget to blog about it and tell the press - the Ethics Commission's complaints and investigations are not public records.
And remember to watch our public officials in public appearances - any audio or video recordings statements they might make to a local group in the course of their duties might be interesting to the public or useful to investigate further.