Should Duke Energy Shareholders Be Nervous About DNC Loan Guarantee?

Jim Rogers and windmill photoIn March NLPC reported that Duke Energy guaranteed a $10 million loan to the Democratic National Committee to host its 2012 convention in Charlotte, NC – the utility’s hometown. Now Duke CEO James Rogers – who heads the fundraising effort as co-chair of the DNC host committee for the convention – is silent about how much money has been brought in so far.

“One of the things that the DNCC really impresses upon us is that we need to work hard, raise the money, not talk about how much we’ve raised at any time because we just need to keep the momentum going and continuing to raise the money,” Rogers told WFAE, Charlotte’s local public radio station and NPR affiliate.

According to the report, Rogers and his teammates are not allowed to solicit corporations and lobbyists for donations, and “the effort is challenging.” And the muteness about fundraising progress is telling, considering that DNC officials proclaimed the gathering would be “the most open and accessible convention in history.” Charlotte was awarded the 2012 confab based upon locals’ commitment to raise $36.6 million for it. According to The Charlotte Observer:

The DNCC’s contract with the host committee – a private nonprofit group – calls for monthly financial reports from local organizers. All contributions, it also says, “shall be disclosed publicly by the host committee within an agreed upon regular time frame.”

But no such disclosures have been made.

“At this point, we’ve decided we’re not ready,” host committee CEO Dan Murrey told the Observer when asked again recently how much money the group has raised. “I think we’re doing great.”

Translation: “We’re not doing so great.” The Observer noted that in contrast, Republicans announced three months ago they had already raised $15 million for their 2012 convention in Tampa, and at a similar point in time ahead of the 2008 DNC event in Denver, Democrats revealed they were on target to meet a $15 million December 2007 target.

“That they can’t report a similar figure yet is a crushing humiliation for the Uptown crowd – or what is left of it – which prides itself on its ability to raise big bucks, above and beyond what cities the size of Charlotte normally can,” wrote John Locke Foundation blogger Tara Servatius.

The “Uptown crowd” consists of crony capitalists and uncritical cheerleaders of anything touted as “economic development,” which includes former current and former top executives of the government bailout recipients Bank of America (which is much-despised) and Wachovia (now absorbed into Wells Fargo), as well as Duke Energy. Local elected officials from both major political parties are also part of this undistinguished group, who suffer from an inferiority complex – especially when compared to Atlanta – and are loathe to ever hear their comparatively bustle-less city streets described as “Down-town.” Their collaborative effort to artificially inflate Charlotte’s significance led to much foolishness, with the creation of a taxpayer-funded, money-losing man-made whitewater rafting facility as one example. This was among many wild-but-failed ideas (like the NASCAR Hall of Fame) that local cronies came up with to make the Queen City a “destination,” which has led to a former blogger to dub Charlotte “Detroit on the Catawba” (River).

Why? Because the city, which had risen to the level of second-largest financial center in the country, has seen its economy tank with the bank bailouts and an endless expansion of debts, taxes and fees to pay for arenas, sports boondoggles and light rail. Unemployment sits at 12 percent, and as the Washington Post recently reported, “subdivisions sit unfinished. Mansions cannot be sold. The school system, which for years had recruited teachers from shrinking cities such as Detroit, laid off more than 1,000 employees this summer.”

That the DNC would want such depressing media factoids as the backdrop for President Obama’s nomination next year is mysterious. Even more perplexing is that the party would choose a state with some of the strongest right-to-work laws in the country, which are anathema to its Big Labor base. Hence the DNC in some cases is bypassing capable local non-union workers in favor of card-carriers from outside North Carolina.

In the midst of this metropolitan dysfunction sits Duke Energy’s Rogers, one of Charlotte’s top political players. Like many involved corporate types he has contributed to the highest level candidates (president, U.S. Senate, Majority leaders) of both major political parties in recent years, but records show he has greater enthusiasm for Democrats, with $99,000 given to the DNC and the party’s Senatorial Campaign Committee, versus just $20,800 donated by Rogers to the Republican counterpart committees. As NLPC has documented repeatedly, Rogers is sweet on President Obama’s (and Democrats’) policies to cap carbon emissions from fossil fuel-dependent industries. And showing he is a total team player ahead of Charlotte 2012, Rogers and his wife Mary Ann have each contributed the maximum-allowed $8,000 to the 2011 mayoral re-election campaign of his convention host co-chair, Anthony Foxx.

That such a freely-giving political donor like Rogers is in charge of convention fund-raising efforts, but doesn’t want word out about the lack of passion or accomplishments for DNC 2012, may not make Duke Energy shareholders feel warm and fuzzy about their loan guarantee. But then again, Rogers has shown unique acumen for gaming government policy and prizes in Duke’s favor, and his partisan favoritism has likely taken him a long way toward reaping profits as a result.

In that context $10 million is a tiny cost for conducting crony-style business, so maybe Rogers’s secret fundraising failure is no big deal to investors after all.

Paul Chesser is an associate fellow for the National Legal and Policy Center.