updated 9/6/2010 7:07:04 AM ET 2010-09-06T11:07:04

At least two dozen charitable organizations set up or run by lawmakers or their families take donations from companies trying to influence policy, a review of federal tax records and Congressional disclosure reports by The New York Times has found.

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The disclosures, which are detailed in a story running on the newspaper's website Monday, revealed that donations continued despite 2007 rules meant to stem the influence of special interests.

While executives said they wanted to give to a good cause, what exactly companies donated to suggested that charity was not the main reason for many of the donations, according to the newspaper.

In addition, in an apparent violation of ethics rules, contributions have often not been disclosed, the paper said.

For example, Cigarette-maker Altria donated at least $45,000 in six weeks in the fall of 2009 to charitable organizations founded by members of the House — including Republican leader John Boehner of Ohio and James Clyburn, the Democratic whip — as the firm was trying to gain approval of legislation seeking to curb illegal Internet sales if its cigarettes, the newspaper reported.

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Some legislators defended the set-up in the article.

"There is nothing improper here at all," Mark Hayes, a spokesman for Indiana Republican Senator Richard Lugar was quoted as saying. "They are simply causes he believes in."

Lugar helped found two Indiana groups supported by corporate contributions, The New York Times reported.

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'We are not apologetic'
Meanwhile, corporate representatives admitted their companies were trying to gain access to lawmakers and push their agendas, according to the report.

"We are not apologetic about it at all: it is part of our overall effort to work with policy makers," Tom Williams, spokesman for Duke Energy, told the newspaper.

Current and former lawmakers and Capitol Hill ethics officials are troubled by the charitable donations, the newspaper reported, and call them a vast unregulated front in Washington's "pay to play" culture.

The charitable donations usually are far more than what firms are allowed to give candidates in campaign contributions, the newspaper reported.

"Almost all of these foundations, they were set up for a good purpose," Mickey Edwards, an Oklahoma Republican who served in the House for 16 years, told the Times. "But as soon as you take a donation, it creates more than just an appearance problem for the member of Congress. It is a real conflict."

The donations can create expectations that the lawmakers will return the favor, Edwards added.

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Video: Fall campaign season arrives

  1. Transcript of: Fall campaign season arrives

    HOLT: Mike Viqueira , thanks. NBC News analyst Howard Fineman is also Newsweek magazine 's senior Washington correspondent. Howard , good morning. It's great to see you.

    Mr. HOWARD FINEMAN (NBC News Analyst): Good morning, Lester .

    HOLT: Republicans have been mocking the president saying what happened to that summer of recovery?

    Mr. FINEMAN: Yeah.

    HOLT: You've seen the unemployment numbers, 9.6 percent last week. In the past the president has said, 'Look, it took us a long time to get in this mess, it'll take a long time to get out of it.' Now he's saying, 'Well, at least we've stemmed the bleeding.' What is he going to say as he goes on the road to placate people who are still out of work?

    Mr. FINEMAN: Well, Lester , I'd like to say that being a political reporter here is rocket science, but it's not. When Barack Obama came into office the unemployment rate was 7.6 percent; it's now 9.6 percent. And eventually is now. For people in places like Cleveland , where I was last week at -- this is the time he's got to say 'I'm going to act further than I have.' It's not a good bumper sticker, Lester , to say "it would have been worse had I not been here." The president needs to say, 'Here's what I'm going to do next,' which is the infrastructure spending, the business tax cuts. He's got to have some things to say on the campaign trail this fall and he's going to start this week.

    HOLT: But the campaign trail is the point. It is an election year, and that taints everything. He's going to talk about small business tax cuts, something Republicans would typically support, but they're not in this case right now. Are they going to basically oppose everything?

    Mr. FINEMAN: Yeah, I think so. I think -- everybody's criticized them for being the party of no, but right now the party of no looks like it's going to win big in November. This -- you're right, this is something Republicans would normally be for but the president's relationship with the Republican Party is completely poisonous and nonproductive. So the president's going to go out there and talk about these things, but the Democratic Party strategy is much different. It doesn't really feature Barack Obama. It's hand-to-hand combat in each local district. Personalities in the district, House stimulus spending has been spent in a particular district. That's what they're going to focus on. You won't see national ads featuring the president. You won't see national advertising about the health care law , which people are skeptical of. You won't see it about financial services reform, which people are skeptical of.

    HOLT: Right.

    Mr. FINEMAN: It's all going to be local.

    HOLT: But you talk about hand-to-hand combat. There's already evidence of some Democrats are trying to save their own skin, running away from the president, running away from Nancy Pelosi , basically trying to save their seat. What will Democratic leadership do to try to get all their folks on the same page? What's the mantra?

    Mr. FINEMAN: Well, it's not going to be on the same page. It's going to be, you do it locally, emphasize your own personality. Emphasize the parts of the stimulus plan that resulted in actual jobs and actual projects in your district. That's going to be one feature of it. Attack the Republicans . But I think the Democrats understand that spending a lot of time talking about the Bush administration is just not going to work. It's been 19 months now, the unemployment rate has gone up. The Democrats have to go on their own and go local. And the other thing that Democrats are going to do is look to those districts they can defend. Rather than prospect in districts that they had no business holding in the first place , they're going to retreat, make the perimeter smaller, and try to defend with money and individual advertising those districts that they have a chance to keep. Because what the Democrats don't want is to lose more than 40 seats. If they do, they lose the House .

    HOLT: Right. Howard Fineman , good to talk to you. Lave a good Labor Day .

    Mr. FINEMAN: You too, Lester .

    HOLT: All right, it is 7:08. Here's Natalie.

    NATALIE MORALES, co-host: Lester , thanks.

    NATALIE MORALES, co-host: And for more on the current jobs situation, let's turn now to Labor Secretary Hilda Solis . Madam Secretary , good morning, and happy Labor Day to you.

    Labor Secretary HILDA SOLIS (US Secretary of Labor): Happy Labor Day , Natalie.

    MORALES: As we just heard, it is all about the economy right now, and the biggest indicator continues to be those unemployment numbers. As we heard on Friday, sitting still at 9.6 percent, the private sector gained 67,000 jobs, the public sector lost over 110,000 jobs. I know that those numbers were somewhat expected, given the layoffs of the temporary census workers. But, Madam Secretary , can you honestly say that the situation really is improving?

    Sec. SOLIS: You know, if you look back where we were when this president took over, we were losing well over 740,000 jobs. In the last eight months alone, each month we've added about 90,000 jobs on average. So we're actually putting private sector jobs back. And the report that I saw tells me that we saw growth again in construction. There were about 19,000 jobs added there. We also continue to see an increase in health care careers, IT, technology. and obviously in manufacturing. We know we have to do more, but this is a good -- this is a good effort on the part of the administration and I'm sure the president, as you know, will be speaking more about that later in the week about some other developments to help improve the economy and create jobs especially with the private sector and small businesses .

    MORALES: That's right . As we mentioned, the president traveling to Cleveland in fact on Wednesday where he's expected to unveil a variety of measures designed to stimulate the economy including a $100 billion tax credit for businesses. But there are many small business owners who continue to remain worried about the tax increases. The Bush tax credit expires at the end of this year. So will the president be -- what will the president be proposing then to help ease their concerns and to encourage job growth ?

    Sec. SOLIS: Well, he's also going to be talking later today at our visit to Milwaukee about infrastructure and the need to create jobs in that area. We

    lost so many jobs in constructuringand in the trades area, and there's a proposal that he'll be talking about later that would provide for front loading, at least for the first six years, about $50 billion for highway, high-speed rail, transportation projects that we really need to concentrate on. That will put people back to work immediately. These are projects and efforts that have bipartisan support that we know could possibly get support in the Congress and the Senate .

    MORALES: And there's been some talk as well about perhaps a secondary stimulus package when money from the first stimulus plan has yet to be fully spent. Do you think that a secondary stimulus package might be necessary in order to help speed the recovery?

    Sec. SOLIS: I don't think we're talking about second stimulus. What we're talking about is looking at some projects that are already out there. Right now in the Senate they're -- we're waiting the vote so that we could pass a tax credit for small businesses and open up more lending through community banks. That's so important. Everywhere I go, that's what -- the theme that I keep hearing over and over again. And obviously the infrastructure effort is something that's ongoing in Congress . I -- having been a member there, I know how important it is to continue funding because we know that that provides jobs immediately. And most members of the House and the Congress , as a former member, we all agree that those things put people to work. They help our economy and they also help to put people there in good paying jobs. So I would say that that's really the focus of where this administration is going. And as I said earlier, the president will talk more about it later on in the week.


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