RALEIGH – The past few months of political-scandal coverage by the Raleigh News & Observer, The Charlotte Observer, other Raleigh-based newspaper reporters, JLF’s own Carolina Journal, Democracy North Carolina, and Joe Sinsheimer have yielded a treasure trove of truly shocking revelations. On Tuesday, former House Speaker and soon-to-be-future Big House denizen Jim Black offered a revelation of his own about a treasure trove – but it was hardly shocking.
In what may go down as the least-surprising political news story of 2007, Black confirmed that Don Beason was the lobbyist who loaned him half-a-million dollars back in 2000, money that he says was initially intended to clinch a real-estate deal and was later put in Black’s campaign account to impress political friends and foes.
Black was testifying at a sentencing hearing in Wake Superior Court. Already a day into his 63-month prison sentence on federal corruption charges, Black was called to the stand Tuesday to explain his actions and motivations. There was entertainment value in much of what he said – apparently, Black is too clueless and sloppy with money to be a crook, that’s his defense. But the most significant admission of the day involved Beason, who still exercises great power in Raleigh, or at least he did so up through Tuesday morning.
Ever since federal prosecutors announced the $500,000 loan to Black, everyone I know in Raleigh political circles – Democratic and Republican politicians, lobbyists, reporters, and activists – said they assumed the “mystery” lobbyist-financier was Beason. Actually, when the news first broke, all said it must be either Beason or former Rep. and lobbyist Linwood Mercer, who traveled in similar political circles. But then election officials narrowed it down to a lobbyist still with us – and I mean in the terrestrial sense, not just the lobbyist-registration sense. Mercer passed away some years ago.
That left Beason as the only plausible miscreant. There was no one else with as much cash at his disposal who was as close to Black (and former Co-Speaker Richard Morgan). But while this was a common understanding around the capital, no one would say it for certain, on the record. Now Black has.
“It was a mistake,” the former speaker said of the loan. Well, now that we know more about the individuals and circumstances involved, I don’t think Black should be allowed to use such namby-pamby language. Beason’s loan to Black wasn’t a “mistake.” It has all the markings of a scam. And that’s only if you buy Black’s explanation of these events as opposed to the alternative offered by Wake County District Attorney Colon Willoughby, who seems (properly) to suspect that the whole affair was a clumsy attempt to cover up an illegal campaign contribution.
Let’s stick with Black’s version for a moment, that the $500,000 was originally intended to be used to demonstrate financial fitness in his negotiations with Charlotte Central City Partners, a nonprofit that promotes the downtown area (uppity Charlotteans call it “Uptown”). CCCP (interesting acronym) was seeking a more prominent location, and reportedly had an interest in a building Black owned on Tryon Street. However, the nonprofit wanted improvements made on the property first. Black says that he didn’t have the money and that getting it from Beason was easier than going to a bank. That doesn’t ring true. By getting the money from Beason, Black presumably didn’t have to pay interest. The problem is that because the loan was from a lobbyist seeking to curry favor, there was at least a reasonable chance that politics could intrude and imperil Black’s financial position in the future. Let’s just say that the CCCP folks were not negotiating with a trustworthy party. Fortunately for them, they found other lodgings.
Second, campaign reports are intended to inform other candidates, donors, and the public at large about the true state of a politician’s financial base. Certainly, many wealthy candidates transfer their own money into campaign accounts for a variety of reasons – to demonstrate their commitment to a run, to show prospective donors that subsequent contributions will be spent on actual campaign expenses rather than fundraising costs, or to scare off competitors. But if you transfer $500,000 of “your” money into a campaign account, but it’s not really your money, you are, once again, attempting to mislead others, including the relevant elections officials, about the assets and liabilities of the campaign.
Black was asked Tuesday for more explanation. “You and I know there all kinds of shenanigans that go on in money and politics,” he testified. In his own defense.
It seems that Beason’s prior testimony to prosecutors has confirmed that he was the source of the loan, and he put out a statement Tuesday night apologizing for the deal. But he has yet to answer questions from the media about it.
Would you?
Hood is president of the John Locke Foundation.