Transcript: Seeking Rents — The Podcast (Ep. 3)

This episode originally aired July 29, 2022

This is Seeking Rents, a newsletter and podcast devoted to producing original journalism — and lifting up the journalism of others — that examines the many ways that businesses influence public policy across Florida, written by Jason Garcia. Seeking Rents is free to all. But please consider a voluntary paid subscription, if you can, to help support our work.

[00:00:00] Hello, and welcome to Seeking Rents — The Podcast. I'm your host, Jason Garcia, the publisher of Seeking Rents, a newsletter where we investigate the ways big businesses twist tax laws, write regulations, and bend other public policy in their favor in Florida.

I've mentioned this before, but the name Seeking Rents comes from a term in economics called rent-seeking, and it refers to when corporations and other elites use their influence to manipulate the political process to make more money for themselves at the expense of everyone else.

If you haven't already, please sign up for our newsletter at SeekingRentsFL.com. Subscriptions are free, but you can buy a paid one if you want to. It's a way to show your support for our work and to help pay for expenses like public records request. So it's been quite a week in Florida politics.

In Orlando and St. Petersburg, local leaders are seriously considering rent control to protect tenants from skyrocketing rents, despite intense [00:01:00] opposition from the apartment industry in Tallahassee, the incoming Republican leaders of the Florida Legislature, who will take control of the House and Senate after this fall's elections, promise to use their power to protect energy and agriculture companies, which in Florida is usually code for electric utilities and Big Sugar. And in DC, the Washington Post had a fascinating, and I think genuinely even- handed, profile of the taxpayer- funded Twitter troll who serves as Florida governor Ron DeSantis' press secretary.

But by far the biggest political news of this week was the absolute avalanche of stories about a whole bunch of schemes that have been orchestrated in recent years by a small group of political consultants working for a handful of high profile corporate clients -- most notably, Florida Power & Light, the state's largest electric company, and arguably the single most powerful business in Florida. This is where we're going to spend this week's show.

I'll include links to all of these stories in [00:02:00] the show notes. They come from the Orlando Sentinel, the Miami Herald, the Florida Times-Union in Jacksonville and Floodlight, a nonprofit news organization focused on climate change. Read them all. These stories are worth the price of subscriptions all by themselves.

Now there's way too much in these stories to unpack in a single episode. But what I'm going to do here today is focus on one small piece of this, because it's something that people in both parties, Democrats and Republicans alike, need to be aware of. Let me start by telling you about a former state lawmaker from Miami — the guy who was the target of so many of these schemes.

His name is Jose Javier Rodriguez, and he's a Cuban American attorney from Miami. He was a member of the Florida Senate until 2020 when he lost reelection because of the state's infamous ghost candidate scandal. We'll talk more about that in a bit. Lots of people call him JJR, and he's a Democrat. But Republicans, you should [00:03:00] also care about his story. We'll talk more about that in a bit too.

So about JJR. The first thing to know about him is that he was the rare Democrat in Florida who had proven he could win in close races in swing districts, even when he had opponents spending millions of dollars to defeat him. For instance, when he first ran for the state house, in 2012, JJR, who was a first time candidate for office, beat a far better known, longtime Republican politician in Miami. When he ran for the state Senate four years later, he beat a Republican incumbent in what was, at the time, one of the most expensive legislative races in Florida history.

The second thing to know about JJR was that he was very progressive. The sort of elected official who regularly and publicly called out the influence of big business lobbyists in Tallahassee. And more importantly, who actually tried to do something about it. JJR fought hard to make changes that [00:04:00] corporate lobbyists hated, like closing corporate tax loopholes and cutting greenhouse gas emissions. Instead of just talking about these sorts of things on the campaign trail.

Now you might think this sounds obvious. JJR was a Democrat from Miami. Of course he was liberal. But this actually made JJR something of an anomaly in Tallahassee, especially in the Florida Senate where Democratic Party leadership has for years tried to raise as much money as possible from the same corporate contributors that donate to the state Republican Party. If Disney, for instance, gives Republican leaders $100,000, these Democratic leaders would happily take $25,000 from Disney.

In fact, some of the state's most powerful corporations have worked closely with Senate Democratic leaders and their consultants in recent years to raise money into the party — but only after steering that money through networks of nonprofits and political committees that make it impossible for anyone else to know the original source of these [00:05:00] donations. They'll tell you that this is all designed to hide the source of the money from Republican leaders, who might retaliate against donors giving money to Democrats. And there's some truth to that. But it's also designed to hide the source of the money from you — because many voters don't really want their candidates taking money from big companies seeking policy favors.

Now you might ask yourself why big businesses would do this. After all, these companies already give much more money to Republican leaders and Republicans are the ones in control in Tallahassee. Partly, it's just about covering your bases, just in case Democrats win some of the few swing seats that these parties spend most of their money fighting over every election cycle.

But it's also about making sure that, when a big donor wants the legislature to do something that might be unpopular, it passes by a big bipartisan majority — so no one person or party catches all the potential backlash from angry voters.

Here's an example. [00:06:00] A few years ago, Florida Power and Light asked the Florida Legislature to pass a bill that would let the company charge its customers more money to pay for burying power lines underground and other things that harden the electric system against wind damage during hurricanes. Not only did FPL want the Legislature to make its customers pay separately for these hurricane hardening costs, they wanted to make a profit off these costs too.

This was a big deal to FPL. In presentations to investors, the company called this legislation a 25 to 35 billion dollar opportunity. That's billion with a B. After it passed, the company's chief financial officer told Wall Street that Florida Power and Light was 'very pleased with this legislation.' This FPL bill passed the Florida Senate 39 to one. The only Senator from either party to vote against it was Jose Javier Rodriguez.

So JJR was a progressive who was popular with liberal voters. [00:07:00] But he also had a record of attracting support from moderate and swing voters, too. This made JJR something that may have been even more important for Florida Democrats: hope for the future.

One of the biggest failings of the Florida Democratic Party since it fell out of power in Tallahassee more than 20 years ago has been its inability to identify, develop, and support candidates at lower levels of government who can grow into bigger roles. Candidates and elected officials in the state legislature or on city councils or school boards who work hard, do a good job and connect with voters. To use a sports analogy, these are the sort of prospects who could one day become compelling candidates for statewide offices like governor attorney general, or United States Senator. This is called building a bench. And the Florida Democratic Party's bench has been vanishingly thin for years.

This is the main reason, by the way, that this year's race for the Democratic nomination for governor is between a former Republican [00:08:00] and a former lobbyist who campaigned for Republicans.

JJR was undeniably one of the brightest prospects on the Florida Democratic Party's bench.He was one of the only prospects on the Florida Democratic Party's bench. But this is also what made Jose Javier Rodriguez so threatening to the corporate interests who have so much influence in Tallahassee. This is especially true of Florida Power and Light — the company that JJR clashed with more than any other.

That hurricane hardening legislation from a few years ago was one example. But there are many others.For instance, JJR sponsored one bill that would've made utility companies transition to 100% renewable energy -- and FPL currently gets roughly three quarters of its energy from natural gas. He sponsored another bill that would've made big corporations pay higher corporate taxes -- and FPL, and its parent company, are among the state's biggest corporate taxpayers. And he sponsored a third bill that could have opened [00:09:00] FPL up to competition by letting landlords with solar panels sell power directly to their tenants — and FPL, of course, is currently a monopoly.

Florida Power and Light executives did not like JJR. The company's CEO even instructed his lobbyists to, quote, 'make his life a living hell,' according to an email published by the Orlando Sentinel and Floodlight. The executive later told the paper that he'd used, quote, 'a poor choice of words.'

FPL's CEO sent that email in January, 2019. And later that year, according to the Sentinel and Floodlight, another executive at FPL received a different email. One that included a proposal to take Jose Javier Rodriguez out by having another Democrat run against himduring the 2020 elections. It was an exceptionally detailed proposal. It identified the ideal recruit: a more moderate Democrat currently serving the Florida House who was seen as much cozier with the [00:10:00] biggest corporate lobbyists in Tallahassee. It suggested strategies to cut off funding from some of JJR's most likely donors. And it laid out a timeline and a budget: nearly $4 million.

But here's what made this proposal so remarkable: it was drawn up by a Democratic political consultant. That's right. A plan to take out one of the most popular and progressive Democrats in Florida, one of the party's best prospects for future statewide office, was written by one of the Democratic Party's own consultants.

What's more, according to the Sentinel and Floodlight, this Democratic consultant then shared his strategy memo with some key Republican political consultants. It was one of those Republican consultants who sent it on to Florida Power and Light, according to the Sentinel and Floodlight.

And here's what I think is the wildest part of all: this plan specifically suggested trying to get Republican and Democratic Senate leaders in [00:11:00] Tallahassee to work together on this. Democratic leaders would agree not to help JJR defend himself in the primary election, if Republican leaders would agree not to go hard after the seat in the general election. Essentially, the idea here was to have both parties agree on a corporate-backed Democrat for this one Miami area Senate seat.

Now, this proposal to run another Democrat against JJR was never put into action. The Democratic consultant who drew it up, told the Sentinel and Floodlight that he wrote the proposal to stress how difficult it would be to defeat JJR on a primary, in hopes of persuading the client that requested it not to do it. Maybe that’s true. Although, if I didn’t want someone to do something, I probably wouldn’t write them a detailed memo explaining how they could do it. Meanwhile, Florida Power and Light told the Sentinel and Floodlight that it didn't ask any of the Democratic or Republican consultants involved with this primary plan to come up with it. The company says it just asked to see the proposal after hearing about it.

But if you take this proposal at face value, think about what it ultimately shows: Democratic and [00:12:00] Republican political consultants working together on a strategy to ensure a corporate-backed Democrat would win a seat in the Florida Senate. This would've happened at the expense of a more populist Democratic incumbent, of course. But it also would've happened at the expense of any potential Republican challenger.

This isn't the first time something along these lines has happened, by the way. Some of these very same consultants were deeply involved in a multimillion dollar race in 2020 for Miami Dade county mayor, which is arguably the second-most powerful elected office in Florida after the governor. All of those efforts seemed to be around ensuring either a, quote unquote, 'pro-business Democrat' or a Republican won that race instead of a progressive county commissioner named Daniella Levine Cava. Cava was another elected official by the way, who had clashed in the past with Florida Power and Light.

Cava ended up winning anyway. But JJR did not.

That's because, while the plan to challenge [00:13:00] JJR in a primary was never put into action, another scheme was: the now-infamous ghost candidate scandal.

That was when a group of political consultants helped a few people qualify as independent candidates in three key state Senate races around the state, including JJ R's seat in Miami. These independent candidates were ghosts, meaning they never did any campaigning themselves. One of them was already planning to move to Sweden. But the political consultants promoted these ghost candidates in a half-million-dollar, dark-money funded advertising campaign. The ads were designed to pull votes away from the Democratic candidates in each race. The ghost candidate recruited to run in JJR's race even had the same last name as him.

Republicans ended up winning all three seats. The spoiler ghost candidate in JJR’s race drew more than 6,000 votes — and JJR ended up losing to his real Republican challenger by just 32 votes.

This has become one of the biggest scandals in the recent history of Florida politics. Five people have been charged with [00:14:00] crimes, including a former Republican lobbyist who prosecutors say bribed the ghost candidate who ran in JJR's race. That Republican lobbyist has pled not guilty and is awaiting trial. Meanwhile, the Republican who took JJ R's place in the state Senate, Senator Ileana Garcia of Miami, ended up voting with Florida Power and Light on another controversial bill that passed this year. That bill could have undercut potential competition to FPL from rooftop solar panels. And it, too, passed the Florida Senate on a bipartisan vote. But Florida Governor Ron DeSantis vetoed it.

You know, there's a growing debate in both political parties, particularly on the Democratic side, about whether candidates should ever accept donations from big corporations that are trying to influence public policy — or from their lobbyists or their dark money nonprofits and political committees. And the people who usually push hardest against this idea are the career political consultants and professional [00:15:00] fundraisers. They argue that refusing to take corporate contributions would be naive and self-defeating. Candidates, they say, should raise as much money as they can, from wherever they can, in order to have the best chance at winning their race.

First of all, this is, at best, a flawed argument. Sure, it is quicker and easier to raise money from corporations. These companies in their lobbies want you to take their money, after all. But a good candidate who is willing to work hard enough can raise more than enough money to run strong campaigns without leaning on businesses who will come looking for favors a few months later.

But it's also a self-serving argument. Because one of the things that I think is becoming very clear in Florida politics is that there are political consultants and campaign strategists and rainmaking fundraisers out there whose most important clients aren't the candidates they ostensibly work for. Their most important clients are the donors they are working with — the donors that are ultimately trying to control those candidates.

[00:16:00]Remember, this stuff has real-world consequences that can ultimately cost you money. Because here's what happened after the 2020 elections: Florida Power and Light won approval from the Public Service Commission to raise rates by more than $1.5 billion over the next four years.

The five commissioners who approved this deal were all appointed by the governor — four by DeSantis, plus one holdover from former governor Rick Scott.

And they were all confirmed by the Florida Senate.

Okay. I think we're going to leave it here for this week. But there is obviously a lot more to this to unpack in future episodes. In the meantime, though, I cannot stress this enough: read these stories by the Herald, the Sentinel, the Times-Union and others. Each piece is just packed with shocking details and important context. Again, all the links will be in the show notes.

As always, if you've got any stories or topics you want me to tackle on a future episode of the pod [00:17:00] or in a future story in the newsletter, please feel free to reach out anytime. My Twitter DMs are always open: @Jason_Garcia. And my email address is in the show notes, too.

One more note about those newspaper stories. You're probably going to run into a pay wall. Pay it, if you can.

These are vital news organizations that we all have to support -- legitimate news organizations that are genuinely searching for facts and context and accountability. All of us, Republicans, Democrats, and independents alike, need real news organizations to counter the rise of fake news outlets that exist solely to launder corporate talking points into legitimacy. Read those stories and you'll know more about what I'm talking about here.

And remember: when you buy a subscription to your local newspaper, ultimately you are helping to pay for more important stories just like the ones we're talking about this week. [00:18:00]

Thanks for listening everybody. See you soon.