Greenville's free alternative weekly

Here in the Palmetto State, the question is whether you are “Republican enough”

By Wes Wolfe

Even while it is widely believed that Ronald Reagan in 1966 said, “Thou shall not speak ill of any fellow Republican,” current historical analysis concludes that he may never even have spoken those words. He endorsed that phrase, words uttered by the California Republican Party chairman, in his gubernatorial campaign that year, but even a professor of history at Cal State-Fullerton said Reagan broke that commandment during his GOP primary campaign. Over 40 years later, intraparty wars threaten the “party of Lincoln” and an exemplary case study can be seen in South Carolina as we draw near to the next general election.

Here in the Palmetto State, the question is whether you are “Republican enough,” with Reagan serving as the mold, and it is this fight, among others, that has fractured the state’s conservative movement and created a political atmosphere where sharks are in the water, where any rumor can spawn a front-page scandal. Such is the case with the rumors surrounding Ed McMullen and his departure from the preeminent conservative think tank in the state, the South Carolina Policy Council.

It’s hard to imagine the South Carolina political scene without Ed McMullen, the man who led SCPC for over 15 years. McMullen is still around, but no longer as the president of the organization. The official reason is that he left to pursue a private public affairs firm, but recent anonymous rumors charge that McMullen was forced out for spending SCPC’s money, as John McCain would say, “like a drunken sailor.” As is the case with many South Carolina political soap operas, someone’s right, someone is totally lying, and it’s hard to figure out the truth.

Just as interesting, no one who says McMullen did something wrong will go on the record about his departure. To a person they say they are frightened of the political and possibly personal ramifications of taking him on. As one person close to the Policy Council said of the higher ups in a close network of conservative organizations including SCPC, “these are a very vindictive group of people.”

McMullen, speaking about nefarious rumors surrounding his departure from the Policy Council, said that “to say that there was excessive spending— whatever this person is saying— couldn’t happen without the board being well aware of every dollar being spent for the last 18 years.” He added that he has “only been president for about 15 years, but that structure was in place from the day I walked in to the day I walked out. Whoever’s [saying] this stuff – there’s been rumors flying around town. The one I got last week was that my wife was dying of cancer, and I had to leave the Policy Council because of that. This town is sick, and this is the kind of sick stuff that simply isn’t true.”

Last July, McMullen took a trip to New York, where rumors abound that he spared no expense – the best seats on the plane, top hotels and a house in the Hamptons, luxury travel and dinners at the most elegant restaurants in town. The trip was said to have run up a $20,000 tab.

For such a leading conservative organization consistently toeing the line of fiscal conservatism, the allegations of liberal spending would be enough to make O’Henry blush.

McMullen says the allegations couldn’t be further from the truth.

“I’m constantly perplexed at how people in this town try and spin stuff,” he said, and says his record as president of the Policy Council speaks for itself. The same source also charges that after an anonymous letter was sent to SCPC’s board decrying McMullen’s spending, board members began to look into the situation and the New York trip became the very substantial straw that broke the camel’s back.

Speaking on background with this publication under the condition that we not reveal any names, the source responsible for the rumors about McMullen claims that in November, McMullen was called out on his spending issues by members of the Policy Council. After a board meeting, the source says McMullen’s computer and cell phone were repossessed, the server link to his house severed, the locks changed at SCPC’s building, along with the setting of a new keypad code for the security system. The source also claims McMullen’s former office was sealed until January. The former SCPC president disputes each one of these claims.

“I know I was in and out of the office regularly, and never had any problem getting in and out of the office,” he said. “Whoever [said] that, I can’t fathom. I can tell you that we did have a human resources issue with another employee, that we did change some security, and that was changed around September-October. I’m not going to into a human resources issue with an employee, but I can [say] there is clearly a precedent for that – anytime anyone leaves an organization, you change the locks and keys.”

McMullen also asserted that the board never had to make a decision as to whether to keep him at the Policy Council. “When I submitted my resignation, that week I had numerous board members calling me, urging me to reconsider it,” he said. “That’s what I’ve been dealing with the last five years every time I’m ready to leave. I had a great board and a great group of people who really wanted me to stay there, and retire there, but that’s not what was in the cards for me.”

McMullen also said that there was never a point where the board had to support him or not support him and that he submitted his resignation to start a public affairs company.

“The board was never in a position to where they had to make a decision,” he said. Regardless of any solid evidence of an internal scandal involving the departure of the president of the Palmetto State’s leading conservative think tank, the perpetuation of the rumors surrounding it by political consultants sheds considerable light on the political culture in the state’s conservative movement.

Allegedly, an Associated Press reporter had caught wind of the rumor and called up the Policy Council in early December in regards to possible spending issues by McMullen.

Ashley Landess, the current president of the S.C. Policy Council, on Feb. 11 confirmed that a reporter did call to verify rumors that McMullen was fired for embezzlement.

“OK, that’s just a flat out lie,” she said of the allegation. “That is the craziest thing I have ever heard. These guys are nuts. I mean I’ve got to be candid with you, this stuff is crazy.”

According to the source perpetuating the rumor, within hours of the reporter’s call a post went up on an S.C. blog called “The Palmetto Scoop” announcing McMullen’s departure. The quickness of the post could be attributed to the blog being run by 23-year-old Adam Fogle, an employee of Mail Marketing Strategies, one of Rick Quinn’s firms. “[McMullen] got to be very in tight with the Quinns and their support of different people and candidates and lobbyists who are involved with them,” said another source familiar with the S.C. Policy Council.

Landess, who officially took over the presidency of the SCPC this year, said she was “stunned” at some of the rumors she’d heard.

“I frankly laughed,” she said.

The New York trip wasn’t the first time McMullen’s supposed spending practices caused some ire, according to those greasing the gears on this particular rumor mill. There were also thousands allegedly spent on the building that the organization owns on Pendleton Street. For a group founded on conservative issues, sources say there was liberal spending on gold-framed mirrors and expensive furniture.

The allegations are enough to make Landess chuckle.

“We raised money to spruce up a building,” she said, shocked to hear someone citing that as something worthy of scandal. “I mean I’ll be honest there was a hole in my ceiling. We raised money specifically for the purpose of renovating the building and sprucing it up a little bit and, you know, yeah, you know that’s what we did. I just don’t know where the other stuff is coming from…who is saying this about us? Who is saying this kind of crazy stuff?” Anonymous sources, obviously, and it is enough to make Landess agree that these current rumors are another example of the “political culture” in South Carolina.

“Things really do get blown way out of proportion in this town,” she said.

“The guy resigned,” she said, speaking of McMullen. “I mean that’s what happened. And all this crazy stuff that we’re hearing out there…I just don’t know what else to say.”

According to profit and loss statements obtained by this publication, the S.C. Policy Council did in 2001 spent about $2,300 on “repair and maintenance.” The next year, during McMullen’s run for the Republican nomination to be Secretary of State — and a time during which the council enlisted an interim president to take his place — that number dropped dramatically to $327.58. But, once McMullen returned, spending on the building jumped over 500 percent, close to the 2001 numbers. Spending continued to increase, according to the SCPC statements, until a 2005 high-water mark of over $8,100. In the past two years, spending has declined to close to the 2001 appropriation. But, the expenses can be easily explained by the fact that, as McMullen says, the organization put together a capital campaign to fully own the building and get it into top shape.

“I think my record at the policy council speaks for itself,” McMullen said. “It’s one of the top think tanks in the nation — a budget around a million dollars — a six-figure endowment, a building that’s paid for, that we did a capital campaign for, and I’ve left with reserves and the organization in the best shape it has ever been and staffed with some of the best staff in the country.”

In a state known for its whisper campaigns, these attacks on McMullen and the Policy Council show a new kind of politics here that has all the trappings of a blaring whistle. Furthermore, those who cite fear of retribution as the main basis for their anonymity in the attacks makes the pitch of it all the more enticing to the ear. Especially, in a town where gossip is hard currency.

If one were to look at the SCPC’s profit and loss statements through the lens of someone looking for liberal spending the dots can connect enough to make at least some kind of case for the black helicopter set and tin-foil hat crowd. McMullen’s travel costs did warrant its own line item in SCPC’s reports but if he did run up bills over $20,000 in one trip, it’s hidden somewhere in the accounting of expenditures. In the past seven years, McMullen averaged between $2,000 and $5,000 in travel expenses, with the exception of putting up over $10,000 in ‘04.

McMullen explains that not only does the organization have its own bookkeeper, but an independent bookkeeper oversaw that accounting as a way to make sure every cent was accounted for and nothing wrong was going on. His salary as president of the organization did go up substantially, though. Between 2001 and 2006, the salary allocated to the president increased more than 100 percent in five years, from $63,333 in 2001 to $130,000 in 2006. But, every salary among SCPC staff jumped during that period, though none others topped the $80,000 mark. There appeared to be a reexamination of the salary structure following 2006, and last year the top two staff members had their income cut by about 25 percent.

“Every year that I’ve been president of Policy Council, the board has been substantially rewarding with bonuses,” McMullen said. “I didn’t make those decisions, the board made those decisions. That’s a clear indication that they’ve been pretty happy with what I’ve been doing.”

It is McMullen’s travel that throws light on SCPC’s role as an advocate for issues such as school choice. According to one document obtained by City Paper, McMullen was set to meet with Howard Rich, John Fund, Steve Moore and Carl Helstrom in a trip to New York. All four are united by issues like school choice, judicial selection and extensively cutting back state and national government.

Rich has become a legendary figure in funding anti-government causes with his significant wealth. He is the founder of U.S. Term Limits and chairs Americans for Limited Government (ALG), along with serving on the boards of Club for Growth and the Cato Institute. In particular importance to South Carolina, Rich chairs Club for Growth State Action, which helps set up and support state efforts, like S.C. Club for Growth and school choice advocates South Carolinians for Responsible Government (SCRG). In filings with the state, SCRG has listed its phone number as being the same for U.S. Term Limits, and the previous owner of its Web site was ALG. Currently, SCRG, S.C. Club for Growth and the Palmetto Policy Group all operate out of the same Devine Street location.

In the 2006 General Assembly primaries and general elections, Rich reportedly threw over $160,000 in to the process via different companies and limited liability corporations he controls.

John Fund is well known as a writer for the Wall Street Journal, a TV pundit and an advocate for the sorts of issues on which the Policy Council works. Steve Moore helped found the national Club for Growth, and Carl Helstrom heads up the State Policy Network (SPN). SPN is an umbrella organization of conservative think tanks, of which the South Carolina Policy Council was the cornerstone.

Mallory Factor, a former resident of New York City and current denizen of Charleston, was supposed to be either included in the meeting, or apprised of it. Factor has used his extensive capital to donate to anti-government conservative candidates and causes, running in the same circles as Rich and Fund. While Factor was still in New York, Gov. Mark Sanford and U.S. Sens. Jim DeMint and Lindsey Graham stayed at his townhouse at different times in what is called the “Norquist suite,” after famous libertarian activist Grover Norquist. In an Aug. 2006 story in the New York Sun, Factor “has fond memories of Governor Sanford of South Carolina raiding his freezer for ice cream.” According to the Sun, the reason Factor decamped from the Big Apple could be that his political energy is used up in the Empire State, and he was looking for a sunnier place from which to operate.

There were trips to other locations and other important names for McMullen to meet with, but the New York meetings illustrate the money connection in what has been called by state legislators here as the most divisive issue in the State House: school choice.

While it’s unknown to what degree SCRG is funded by out-of-state school choice money, and Rich’s relationship with the state Club for Growth chapters is clear, the Policy Council has been on the front lines of the debate. Alliance for School Choice (ASC), a group that calls itself the “largest organization in America supporting private education vouchers and tax credit programs,” gave $148,000 to SCPC in 2004, according to their profit and loss statements, as Sanford’s push for the Put Parents In Charge Act (PPIC) was gaining momentum. That year, the Policy Council spent over $28,000 on school choice related expenses, including over $17,000 for a school choice retreat. An additional $6,750 was split between studies on county and school spending, and school choice.

The next year, according to Policy Council documents, brought in a tsunami of dollars. ASC gave $120,000 and research leads us to believe the New Yorkers for School Choice Research & Education Committee chipped in $960,000. Most of that money went to an $814,888 media buy, and radio and TV advertisement production. Another $7,371 was allocated for meetings related to the issue.

After the failure of PPIC to make it to a vote in the House of Representatives, the tide washed back out on the big money projects. However, donations from foundations picked up, increasing by half, and corporate donations saw an up-tick of eight percent.

Late last year, SCPC was still running down donations from ASC, the Parents in Charge Foundation and ALG. Other potential backers were the Walton Foundation (of Wal-Mart fame), the Lynde and Harry Bradley Foundation and the Charles G. Koch Foundation. The Milton and Rose D. Friedman Foundation, Jaquelin Hume Foundation and Barre Seid Foundation already committed a combined $150,000 to the Policy Council. South Carolina foundations that sent tens of thousands of dollars in support include the Roe Foundation (set up by the late Thomas Roe, founder of the Policy Council) and the Milliken Family Foundation. Each foundation is marked by strong support, through grants and donations, of libertarian-leaning conservative issues like school choice.

In the big fight over school choice in 2005, the significant GOP opposition to the bill was best summed up by then-Greenville County School Board Chairman Chuck Saylors.

“The word is out,” Saylors told The (Greenville, S.C.) MetroBeat. “They have a multi-year plan to pass this legislation, and the money and political will to keep going for five years. They think if you keep pushing hard enough, sooner or later, you’ll get something through.”

Saylors continued, “I would consider myself a life-long Republican, but this lockstep mentality is driving people away. This is just an honest disagreement over what we consider a bad piece of legislation.”

The battle extended into the GOP primaries, where in 2004 and 2006, Republican opponents of school choice were targeted for defeat by groups like SCRG. In Rep. Bill Cotty’s renomination run against Sheri Few in District 79 in ’06, he faced stiff attacks from the pro-school choice faction.

“They’ve petrified my colleagues,” Cotty said in a column in The State by Cindi Ross-Scoppe in Aug. 2006. “When they see $30,000, $40,000 spent – in my race $85,000 to $100,000 – they’re petrified. When you spend that kind of money, they’re hitting their objective, not by how many races they win but by being able to scare people: If you don’t agree with us, we’re gonna back the truck (full of money) up.”

The groups, particularly S.C. Club for Growth, are gearing up for another try at unseating incumbent Republicans, this time in the June 2008 primaries. As described in a Jan. 23 Free Times story “The Hit List, ” (full disclosure: the author of this piece co-wrote the story) former Sanford spokesman Will Folks drew up a proposal to S.C. Club for Growth to target, ultimately, 15-20 legislators. Many lawmakers on the list attributed their presence on it to opposition to school choice.

GOP political consultants, spoken to on background, lament how the split within the state party is paralyzing conservative legislative efforts. Unless something changes, that will be the status quo through the next two election cycles.

Corey Hutchins contributed to the reporting of this story. You can reach Wes Wolfe at wswolfe@gmail.com.