Bruce Murphy
Back in the News

Report Claims ‘Corruption’ by Ron Johnson

Newly formed Democratic research group finds senator made millions through self-dealing.

By - Jul 29th, 2020 12:33 pm
Get a daily rundown of the top stories on Urban Milwaukee
Christina Brungardt. Photo by Lynn Lane/Madison Museum of Contemporary Art. Photo by Gage Skidmore from Peoria, AZ, United States of America / CC BY-SA (https://creativecommons.org/licenses/by-sa/2.0)

Christina Brungardt. Photo by Lynn Lane/Madison Museum of Contemporary Art. Photo by Gage Skidmore from Peoria, AZ, United States of America / CC BY-SA (https://creativecommons.org/licenses/by-sa/2.0)

The Congressional integrity Project, a new liberal leaning research group that intends to scrutinize conservative members of Congress has released its first report, and it’s aimed squarely at Wisconsin’s Republican U.S. Senator Ron Johnson.

Entitled “Covering for Corruption,” the report charges that: 

-Johnson is “one of the richest members of the Senate, with a net worth of tens of millions,” and “according to Johnson’s Personal Financial Disclosures, his wealth has likely doubled since running for the Senate.”

-“During his 2010 campaign, Johnson promised to place his assets in a blind trust to ensure that he would legislate in the public interest. That did not happen.” 

-Johnson blocked efforts to crack down on corporate tax dodging while benefitting from this. Johnson “owns 9.9 percent of DP Lenticular, a Dublin-based company, which is worth up to $500,000” and had just one full-time employee. “Johnson’s brother, Barry, sat on their board. The company is owned by Spanish holding company that pays no taxes….Johnson repeatedly opposed measures to close the tax loophole that allows companies to avoid taxes by reincorporating in low-tax countries like Ireland.” 

-“In 2017, Johnson cast the deciding vote for the Republican tax bill — but only after winning changes to line his own pockets.” He “successfully pressured Senate leadership to lower taxes for pass-through businesses… whose owners report profits on their individual tax returns. Those changes significantly lessened the tax burden on companies like Pacur, still run by Johnson’s brother.”

-The 2017 tax bill “also provided a massive boon to private equity firms,” including Gryphon Investors, which bought Pacur in February 2020. “The tax bill’s provisions appear to have benefited Johnson enormously.” According to his senate financial disclosure forms, before the bill’s provisions had gone into effect, “Johnson estimated his stake in Pacur was only worth between $1 million and $5 million. One month after Pacur was sold to Gryphon, however Johnson sold his stake for between $5 million and $25 million.”

-“As the country faced an unprecedented pandemic, Johnson made millions…According to Senate disclosures, Johnson sold his stock in Pacur on March 2 — before states locked down and markets began to sink. Johnson’s profits from the sale of his company may have been as high as $25 million, eclipsing the $1.7 and $3 million that Sens. Richard Burr and Kelly Loeffler respectively pocketed from stock sales following closed-door briefings on Covid-19.”

-“While Johnson enjoyed his new profits, he fought against measures to protect American businesses. In June, Johnson tried to stop bill to help small businesses obtain loans under the Payment Protection Program — and then fought to end it early even as many states reported a record number of new Covid-19 infections. In July, he called continued aid to unemployed Americans ‘perverse’ and vowed to vote against ‘even a dime more’ in spending. Johnson even proposed limiting loan forgiveness to businesses that reported less than 60 percent of their 2019 income in 2020, arguing that ‘no one should be allowed to make money off it.’”

in response to the report, Johnson, through an aide, told NBC he didn’t recall a campaign promise to create a blind trust and that he didn’t do this because “his family runs the business, making it impossible for it to be truly blind.”

As for his net worth increasing while in office, Johnson’s office says the report and coverage of it by NBC depended upon research by the The Center for Responsive Politics, whose estimate of Johnson’s net worth was incorrect. “In fact his net worth is not far above what it was the year he first took office,” Johnson’s response contends.

As to his sale of stock in Pacur in March, after members of Congress received confidential briefings on the coronavirus pandemic, Johnson has said the sale had been in the works since 2018 and was unrelated to the pandemic. “His office shared correspondence indicating that the Senate Ethics Committee ‘did not find evidence’ that he had violated federal law or Senate rules or conduct guidelines in the sale,” NBC reported. 

And regarding the 2017 tax bill pass-through provision he benefitted from, Johnson’s spokesperson told NBC it is “intellectually dishonest” to suggest that securing lower tax rates for a majority of small businesses is self-dealing. “Senator Johnson was one of the few members of Congress worried about pass-throughs. It is thanks to his work that the average American business was helped by the tax bill,” the spokesman said

As for the overseas company he invested in that paid no taxes, Johnson told NBC he got a return of no more than $5,000 from this. 

The non-profit, 501(c)4 Congressional Integrity Project lists a board whose members have previously worked for Democratic politicians or liberal advocacy groups. It declines to disclose the source of its funding. The group promises there will be further research on Johnson, and other conservative members of Congress who have “used their positions to enrich themselves and those close to them.”  

A New York Times story suggests Johnson was the first target because his senate committee has been looking for negative information about Democratic presidential candidate Joe Biden. “Tired of watching Republicans with their own checkered ethics backgrounds attack Mr. Biden over his son’s business dealings in Ukraine, a group of Democratic officials on Wednesday introduced an organization intended to target corruption by congressional Republicans,” the story noted. “Of course, few Washington politicians have used the federal government to boost their personal business interests more than Mr. Trump has, so it remains to be seen how effective the new organization will be in damaging the political reputation of Mr. Johnson, who doesn’t face re-election until 2022…”

Johnson has been given a grade of “F” by the Republican-leaning Lugar Center for his leadership of the Senate Committee on Homeland Security and Governmental Affairs, as Urban Milwaukee has reported. And top congressional Democrats led by House Speaker Nancy Pelosi have warned in a letter that “Russian-linked information is being funneled to” Johnson’s committee to “further Russia’s efforts to interfere again in the American presidential election” and “to smear” the Biden campaign. In response to the Democrats, Johnson told Politico “They’re simply wrong.”

Update July 30: Sen. Johnson has published a blog post calling the Congressional Integrity Project report a “smear” and taking issue with some of its findings and with the way NBC reported them.

If you think stories like this are important, become a member of Urban Milwaukee and help support real, independent journalism. Plus you get some cool added benefits, all detailed here.

6 thoughts on “Back in the News: Report Claims ‘Corruption’ by Ron Johnson”

  1. B says:

    A google search found an article from Bloomberg dated from 2011 that mentions that Senator Johnson would like to set up a blind trust but has been to busy. This article is located on Senator Johnson’s own webpage. https://www.ronjohnson.senate.gov/public/index.cfm/2011/6/bloomberg-senator-johnson-holds-millions-in-cash-to-avoids-conflicts-profits

  2. Mingus says:

    I think the late Wisconsin Senator Joe McCarthy might conclude that Johnson’s activities to discredit the Ukraine investigation and slander a patriotic member of the Army like Colonel Vindman might be indications that he is a Communist sympathizer.

  3. kcoyromano@sbcglobal.net says:

    Does it surprise anyone that one of our nation’s most corrupt Presidents and Ron, his huge supporter, is as corrupt as he is?
    As they say, ‘birds of a feather, stick together.’….Sen. Johnson has a lot of nerve. His own self-interest is paramount.

  4. SFGiants58 says:

    Senator Johnson’s rebuttal points out that a key premise of the “report” and Bruce’s article is wrong.

    “One of Przybyla’s most remarkable questions stemmed from her reliance on the Center for Responsive Politics’ Open Secrets website, which attempts to calculate politicians’ net worth off their public financial disclosure forms. Przybyla asked how Senator Johnson’s “net worth, according to the nonpartisan Center for Responsive Politics, (jumped) from $24 million when he was elected in 2010 to $78 million in 2018? (considering he sat out the market?)”

    “She was given the straightforward answer: It didn’t. Open Secrets was wrong when it reckoned the senator’s net worth, and wrong when the Democrat attack group fed Przybyla the story idea.

    “Remember that financial disclosures report the value of assets as falling with ranges. Open Secrets adds up the minimum values of each asset and the maximum values, reports the totals and estimates a politician’s net worth as the average of the two. Przybyla’s claim about how much Senator Johnson’s net worth “jumped” is based on Open Secrets’ erroneous estimate of his assets’ value (see it here) as “totaling $28,202,028 to $128,732,000 in 2018.” The midpoint of these figures is $78 million, the figure Przybyla asked about.

    “But Open Secrets’ tally of the senator’s assets was wrong: The Center for Responsive Politics double-counted many of his assets, using slightly different names. The center, or Przybyla, could have seen this if they compared the tally to the senator’s filed disclosure forms, which Open Secrets even offers, here.

    “But they didn’t.

    “The result of Open Secrets’ screw-up, which they quietly have corrected, was to overstate the senator’s net worth by a factor of two. The website did the same double-counting mistake on at least some of his assets in 2017 (see here), and has quietly corrected that, too.

    “The result? The Center for Responsive Politics’ estimate of Senator Johnson’s net worth is not far above what it was the year he first took office. It is in fact in the same range it has been since he was elected. This means that Przybyla’s claim that the senator “is likely to have increased his wealth anywhere from 50 percent to 100 percent since he took office” is simply wrong according to the source she goes on to cite.”

  5. SFGiants58 says:

    This Is Not Good Journalism
    Bruce Murphy has done some solid reporting over the years.
    And then there is his latest piece, a write-up about Senator Ron Johnson under the inflammatory headline “Report Finds ‘Corruption’ by Ron Johnson.” A subhead reads, “Newly formed Democratic research group finds senator made millions through self-dealing.”
    The headline did its job. It caught my attention. But a second look told me something was amiss. Note that the word corruption is in quotes. Why would Murphy need to do that? Why wouldn’t he just use a headline saying “Report Finds Corruption by Ron Johnson”?
    Because the “report” is simply a political hit job that in fact finds zero evidence of corruption. It is not a report of findings by a credible government or non-biased independent group. Instead, as described in a slanted item at the NYTimes: “Tired of watching Republicans with their own checkered ethics backgrounds attack Mr. Biden over his son’s business dealings in Ukraine, a group of Democratic officials on Wednesday introduced an organization intended to target corruption by congressional Republicans.” Note that the once-dignified NYTimes matter-of-factly accepts the idea that Johnson is among those with a “checkered ethics background.”
    Murphy’s piece cites salacious claims as evidence of “corruption” and “self-dealing.” Were they credible one would expect the likes of Senator Charles Schumer to have pressed for sweeping ethics investigations. Yet in the single incidence where the Senate Ethics Committee did get involved it found no evidence of wrongdoing. You must read deep into Murphy’s piece to learn this.
    The various claims boil down to the fact that Ron Johnson was and remains a wealthy person. It is inevitable that legislation which would come before him (and many of his colleagues) could have a personal impact. But for Murphy, and the Democrat advocacy group, votes that Johnson believes are good policy are actually “self dealing.”
    The Committee on Ethics of the U.S. House of Representatives offers an analysis of issues relevant to the Democrat “report” of “corruption” and “self dealing.” Excerpts:
    “Members of Congress enter public service owning assets and having private investment interests like other citizens…A Member of Congress must exercise judgment concerning legislation across the entire spectrum of business and economic endeavors. Requiring divestiture may also insulate legislators from the personal and economic interests held by their constituencies, or society in general, in governmental decisions and policy…
    “Some conflicts of interest are inherent in a representative system of government, and are not in themselves necessarily improper or unethical. Members of Congress frequently maintain economic interests that merge or correspond with the interests of their constituents. This community of interests is in the nature of representative government, and is therefore inevitable and unavoidable…
    “Public disclosure of assets, financial interests, and investments has been required as the preferred method of regulating possible conflicts of interest…The objectives of financial disclosure are to inform the public about the financial interests of government officials in order to increase public confidence in the integrity of government and to deter potential conflicts of interest.”
    It’s to be expected that partisan advocacy groups will issue “reports” with the kind of “findings” reported by Murphy. Good journalism would require ignoring them or providing full context. That did not occur here.

Leave a Reply

You must be an Urban Milwaukee member to leave a comment. Membership, which includes a host of perks, including an ad-free website, tickets to marquee events like Summerfest, the Wisconsin State Fair and the Florentine Opera, a better photo browser and access to members-only, behind-the-scenes tours, starts at $9/month. Learn more.

Join now and cancel anytime.

If you are an existing member, sign-in to leave a comment.

Have questions? Need to report an error? Contact Us