Sean Eldridge, a major financier of Mainers for Accountable Elections, the group behind Question 1 in November, has been accused of attempting to buy a congressional seat.
In his 2014 run to represent New York Congressional District 19, Eldridge engaged in several actions that, while not technically illegal, contradict the spirit of the campaign finance reform he is now heavily funding in Maine and other localities across the country.
According to a campaign finance report filed by Mainers for Accountable Elections in July, Eldridge has contributed $100,000, roughly a third of the total funds raised by the group. Eldridge is far and away the highest individual donor to the group according to the most recent reports despite being from out of state. Eldridge, who currently resides in New York, first dabbled in Maine politics back in 2012, when he dumped tens of thousands of dollars into the state’s same-sex ballot initiative.
Despite the out-of-state financier’s self-professed dedication to campaign finance reform, his actions leading up to the 2014 election have caused many to consider his position hypocritical.
In 2011, Eldridge and his husband, wealthy Facebook co-founder Chris Hughes, bought a $5 million estate in New York’s 18th Congressional District. Prior to that, the couple had lived in a luxurious SoHo loft in Manhattan. With few political opportunities for Eldridge there, the two decided to move to the 18th District in upstate New York, reportedly in order to run for that seat three years later. Eldridge and Hughes denied that they moved to the district solely to run for political office. In a glowing piece for the New York Times, Eldridge stated that the 18th was where “we put down roots, where we want to have a family.”
However, when the 18th was won by a Democrat in 2012, Eldridge was again left with very narrow political opportunities. So less than two years after purchasing a $5 million mansion in the 18th, Eldridge and his husband bought a $1.9 million home in the neighboring 19th District. This was in January 2013–only two months after a Democrat had sealed off Eldridge’s chance of running in the 18th. Just a few weeks earlier, Chris Hughes deflected a question from New York Magazine about Eldridge’s political ambitions. While Sean wanted a career in politics, said Hughes, “I don’t think there’s any rush.”
Less than 9 months later, Sean Eldridge entered the race for New York’s 19 Congressional District.
After purchasing two luxurious homes in upstate New York in less than two years, Eldridge was finally qualified to run for Congress in a district he felt he could win. The million dollar properties hardly made a dent in the couple’s fortunes, as Hughes has a reported $700 million fortune due largely to his role at Facebook. He could now technically run for the 19th, but he needed to give voters a reason to support him. Why was he qualified to represent them in Congress?
Shortly after purchasing his first mansion in the 18th, Eldridge started up Hudson River Ventures, an investment company. The company provided loans and equity to small businesses in the surrounding communities, ranging from $50,000 to $500,000. When Eldridge finally began running for office officially a couple years later, he would claim that he had created thousands of jobs in the district. Hudson River Ventures made its first investment in 2012, just a few short months before the couple bought their second home in the 19th.
Eldridge claims that the capital firm’s investments were not meant to buy votes. His campaign noted that the company also invested in several companies outside of the 19th district. That said, when one looks at a map of Hudson River Ventures’ investments, a clear pattern emerges.
A clear majority of the investments occurred within the 19th District, although several investments occurred in the neighboring 18th…where Eldridge was reported to have first plotted a Congressional bid.
Moreover, the ties between Eldridge’s campaign and Hudson River Ventures raises more questions of impropriety. “Michael Oats, a New York Businessman and CEO of [Hudson River Ventures], is Eldridge’s campaign treasurer. SKDKnickerbocker is working for Eldridge’s campaign and doing public relations work for the investment group at the same time,” reported Politico in 2014.
When Eldridge moved from the 18th District to the 19th District in 2013, Hudson River Ventures followed in his wake, relocating to the small city of Kingston. According to a New York Times report in July 2013, Hudson River Ventures had already sunk $800,000 into the district.
While campaign finance experts seem to agree that Eldridge’s actions are legal, they seem to flirt with the lines of propriety. Eldridge’s actions in the 19th would certainly be accused of attempting to buy the election by the very campaign finance reform advocates that he funds–if not for the fact that he gives them copious amounts of cash. Shortly after the election, a piece in The Daily Beast called Hudson River Ventures “essentially a vote-buying apparatus masquerading as an economic-development project, to win over small-business owners and their employees.”
Big Money Politics
Probably the biggest kicker of the entire affair in the 19th is the absolute mountain of money Eldridge dumped into the campaign. While wailing against the injustice of big money in politics, Eldridge’s campaign raised more than twice the amount that his Republican opponent did. In fact, Eldridge personally donated more money to his own campaign ($4.25 million) than his opponent raised in total ($3 million).
Ultimately, Eldridge raised $6.3 million. Most of that colossal amount was donated by Eldridge himself, although he also received financial support from liberal financier George Soros and other big money liberals–very little of Eldridge’s financial support came from inside his district. When one considers the lengths Eldridge went to secure a Congressional seat, that $6.3 million is just the tip of the iceberg. If one counts the two luxurious homes and Hudson River Ventures, the amount that Eldridge spent in his run for Congress more than doubles. The two may reclaim a bit of that money, as the two are reportedly selling their SoHo condo for an astounding $8.75 million.
The real irony in this ordeal is that ultimately, Eldridge’s campaign proved that one can’t always buy an election. Despite overspending his opponent by millions of dollars, Eldridge lost in November when his opponent captured almost 2/3’s of the vote. Perhaps the next time Mainers for Accountable Elections claims that they want big money out of politics, they can look to New York’s 19th District and admit that money can’t buy everything.
In November, Mainers will go to the polls to vote on Mainers for Accountable Elections’ ballot initiative. They will be told that Question 1 is necessary to keep big money out of politics, but that’s not true. Question 1 would not stop a Sean Eldridge from dumping millions of dollars into his campaign. It would not stop the shady actions of Eldridge in investing hundreds of thousands of dollars into the district he wants to run in during the short two years before the election. It would not stop carpetbaggers from buying rich homes in districts that they have no history in so that they can run for office. It would not stop the absolute cascade of money that an Eldridge would throw at a district to win.
What Question 1 would do is make some very minor tweaks to Maine’s Clean Election Act that would not keep big money out of Maine politics or substantially increase transparency.
Question 1 would significantly increase public financing for candidates who choose to use it. You may note that this does not reduce the amount of money in Maine elections, but adds to it. Furthermore, it only perpetuates the already broken system of welfare for politicians, where taxpayers are forced to subsidize the campaigns of candidates they may disagree with.
Question 1 would require independent campaign advertisers to reveal their top three donors. However, political groups are experts at avoiding disclosing their donors and know how to use dummy organizations and c(4) status to protect their donors. As I’ve pointed out previously, many of the liberal groups supporting Question 1 practiced these tactics as recently as 2014, when they set up a PAC and funneled donations through c(4) organizations to keep donations anonymous.
Finally, Question 1 would increase fines on campaign finance violations. The problem with that is most people and organizations operating in politics are smart enough to accomplish their ends while staying within election finance laws. Sean Eldridge is the perfect example of this as someone who put buckets of cash into his district in an attempt to win without ever doing anything illegal. People like Eldridge know how to use the system to their benefit; increased fines may catch a few people who make mistakes, but it won’t change the culture of big money in politics.
This November, Mainers need to ask themselves whether Question 1 is a game changer or if it is an attempt to win political points while maintaining the status quo. Judging by Mainers for Accountable Elections’ financiers, one would be hard pressed not to be stricken by their blatant hypocrisy.
A Politico story from 2014 reported, “Like no other 2014 candidate, Eldridge is testing the limits of dollars and cents to secure a seat in the House of Representatives.” If Mainers for Accountable Elections is serious about reducing the influence of money in politics, then they need to address the elephant in the room: do they support Eldridge’s attempts to buy a Congressional seat? It’s hard to think of a more clear-cut example of an individual attempting to influence an election with money.
Will Mainers for Accountable Elections denounce Eldridge’s big money gambit in the 19th, or will they look the other way as they pocket his fat check?