Eli Broad and the Clintons

By Ken Derstine at Defend Public Education!

June 28, 2015
Last link update: July 17, 2015

The Broads and the Clintons at the pre-ball dinner hosted by Eli Broad at the Inauguration of Barack Obama on January 20, 2009. Click here to view more pictures from the event.

For some people, sleep seems incidental. If you’re one of them, I envy you. Bill Clinton, who I have known since he was governor of Arkansas, sticks out in my mind as someone who does exceptionally well with very little rest.

While he was president, he invited me to stay at the White House. It had been a long day and I was tired, so I went to bed a bit early. At 11:30 PM, I woke up to a knock on the door. The president’s usher poked his head in and informed me the president was in the solarium and wanted to chat. There wasn’t much I could say except, “Sure.”

President Clinton came in, sat down, and began talking about everything–the Russian election, the Taiwan Strait, Israel, and why Kentucky was the best of the Final Four in that spring’s college basketball playoffs. We ended up going to bed not long before dawn.

            From The Art of Being Unreasonable by Eli Broad
            John Wiley & Sons, Inc. 2012   p. 40, 41

During his presidency, Bill Clinton started the controversial practice of inviting political supporters to spend the night in the Lincoln Bedroom of the White House. Nearly 1000 White House guests gave more than $10 million in the 1990’s towards his reelection campaign and later to Hillary Clinton’s 2008 Presidential bid. One of the contributors was Eli Broad who gave more than $162,500. From January 1, 1995 to December 31, 1996 Broad gave $100,000 and listed his corporate affiliation as Truman Arnold Companies. Truman Arnold Companies is a $2.2 billion Texarkana, Texas petroleum marketing company. Clinton’s assistant District attorney, Webster Hubbell, who was convicted on corruption charges in 1994, was on the payroll of Truman Arnold and Sun America, Inc., “a California financial services company controlled by Eli Broad, a close Clinton friend who, like Rapoport and Arnold, stayed overnight at the White House.”

Eli Broad started accumulating his riches from a real estate company that he began with his wife’s cousin on borrowed money in 1957. Riding the crest of the expanding real estate market after World War II, particularly with the growth of suburbs around urban areas, Broad began building his millions, later to be billions, when he acquired Sun Life Insurance Company of America in 1971. In 1999, he sold SunAmerica to the American International Group (AIG) for $18 billion. For those who see accumulating wealth as the measure of a man, Broad became an icon fulfilling the American Dream’s Horatio Alger myth of the self-made man becoming incomprehensibly rich.

Fortunately for Eli Broad, his myth could remain intact during the real estate and financial market crashes in 2008 because his affiliation with his real estate business and financial company was years in his past. He stepped down as CEO of Kaufman & Broad in 1974 and CEO of SunAmerica in 2000. AIG was given $182 billion in taxpayer funds in 2008 to prevent the company, and the financial system, from collapsing during the financial market collapse brought on by the real estate market collapse.

In 2000, Broad and his wife Edythe created the “philanthropy” The Broad Foundations. The “philanthropy” became a means for the Broads to bring their Horatio Alger myth to the arts and to education, having no background in either, and, along with other major “philanthropists” like the Gates Foundation and the Walton Foundation, he begin the reshaping of public education in the United States to fit a neoliberal agenda in the interests of the financial oligarchy the 1% is trying to form in the United States.

Bill Clinton’s all night White House meeting with Eli Broad, occurred as Clinton, under the guise of a progressive agenda, was advancing a neoliberal agenda during and after his presidency. Though he claims many of the reactionary laws during his Presidency were due to Republican intransigence, the Democrats controlled both legislative bodies during Clinton’s first term when most of these reactionary laws were passed. He continued with the policies of the Reagan years that were a counter-reform undermining the gains of Roosevelt’s New Deal and the Civil Rights movement of the ‘60’s. Corporate and financial interests had given these concessions because of fears that labor unrest in the 30’s and urban unrest in the 60’s would lead to a political movement that threatened the interests of the 1%. The repeal of the Glass-Steagall Act of 1932 benefited Clinton’s many White House guests and others in the 1% and have led to historic levels of wealth for the 1% even as it has impoverished the 99%. Clinton’s Violent Crime Control and Law Enforcement Act of 1994 led to an expansion of Reagan’s “War on Drugs” which creation a prison population that is the largest per capita in the world and an expansion of the death penalty for the low-income population. His Personal Responsibility and Work Opportunity Reconciliation Act of 1996, known as “welfare reform”, was to lead to an explosion of homelessness and low-income or no-income families falling into a poverty not seen since the Great Depression. The North Atlantic Free Trade Agreement (NAFTA) opened up corporations to low-wage workers in the developing world and gutted manufacturing in the United States. It is under these conditions that Eli Broad launched his “philanthropies”, including the Broad Superintendents Academy in 2000, to train and insert superintendents in school districts all around the United States who would advance a privatization of public schools agenda. Based on the right-wing economic theories of economist Milton Friedman corporate education reform began a fascistic agenda designed to reshape public schools financially and ideologically for the one percent.

Playing a central role in promoting Clinton’s neoliberal agenda was the Democratic Leadership Council. Formed in 1985 after the defeat of Walter Mondale and the reelection of Ronald Reagan, it became the think tank for many of the rightwing neoliberal policies promoted by Clinton. Clinton was head of the DLC in 1990 until he became President in 1992. A key player shepherding the neoliberal agenda during the Clinton Presidency and after was Bruce Reed who became head of the Democratic Leadership Council in 2001.

On March 22^nd, 2010, a New York Times article described his history.

“Mr. Reed was policy director when Mr. Clinton, then the governor of Arkansas, was chairman of the Democratic Leadership Council. Mr. Reed also served as deputy chairman of policy for the 1992 Clinton-Gore campaign, then worked in the White House for all of the Clinton administration.

As head of the Domestic Policy Council, he had a leading role in overhauling welfare in 1996 and in developing initiatives on education, crime, health, tobacco and more. In 2006, back at the Democratic Leadership Council, Mr. Reed and Rahm Emanuel, now the White House chief of staff but then a congressman and Mr. Reed’s friend from their years in the Clinton administration, wrote a book called “The Plan: Big Ideas for America.” It was intended as a platform for the Democrats’ takeover of Congress that year.”

Files in the National Archives show that Reed was heavily involved in developing the Clinton neoliberal education agenda. Files from 1997 – 2000 in 133 folders in 9 boxes “includes material pertaining to national standards and testing; the Elementary and Secondary Education Act (ESEA) and the 1999 efforts to reauthorize the act; 100,000 teachers and class size; charter schools and vouchers; education events and forums; social promotion; Goals 2000; Helping Outstanding Pupils Educationally (HOPE) Scholarships; Pell Grants; the Education Flexibility Partnership Act of 1999 (Ed-flex); education funding and budgets; and various school and teacher issues.”

In the final months of the Clinton administration, another controversy erupted over favoritism for wealthy supporters of the Clinton’s neoliberal agenda. Hillary Clinton played an active role in efforts to give tax breaks to private foundations and wealthy charity donors at the same time as donations were being solicited for Bill Clinton’s presidential library. Bruce Reed, who was Clinton’s chief domestic policy advisor at the time, dismissed the controversy saying, Clinton "wanted to give a break to working people for putting a few more dollars in the plate at the church. Not for any other far-fetched reason." Months before proposing the tax breaks, Clinton White House officials had proposed holding a September, 1999 conference to celebrate “philanthropy heroes” who had donated large gifts. The list included “Microsoft's Bill Gates and his wife, Dell computer founder Michael Dell and investors George Soros and Eli Broad”.

In July of 2005 Hillary Clinton was appointed by the Democratic Leadership Council to define the party’s agenda for the upcoming 2006 and 2008 elections. Reed assured an interviewer on NPR that she was on board with the neoliberal agenda but her appointment had nothing to do with a political run for President in 2008.

Despite his endorsement of Hillary Clinton in the 2008 election, Eli Broad was thrilled with the election of Barack Obama. The 2009/2010 Annual Report of the Broad Foundation (page 5) says,

“The election of President Barack Obama and his appointment of Arne Duncan, former CEO of Chicago Public Schools, as the U.S. secretary of education, marked the pinnacle of hope for our work in education reform. In many ways, we feel the stars have finally aligned.

With an agenda that echoes our decade of investments—charter schools, performance pay for teachers, accountability, expanded learning time and national standards—the Obama administration is poised to cultivate and bring to fruition the seeds we and other reformers have planted.”

Arne Duncan had been on the board of the Broad Foundation until he became Secretary of Education (2009/2010 Broad Report page 25) and, according to this Report brought five Broad Residents and alumni with him to the Department of Education. Also on the board (2009/2010 Broad Report page 25)   the Broad Foundation is Larry Summers who served as top economic advisor in the Clinton and Obama administrations after being Chief Economist for the World Bank from 1991–1993. At this time the World Bank was in the midst of playing a leading role in developing a neoliberal education agenda in Chile that began under the Pinochet dictatorship. Among the many former officials in the Clinton administration joining Obama’s administration was Bruce Reed who became Vice President Biden’s chief of staff. On March 22, 2010 he also was appointed executive director of President Obama’s bipartisan commission to reduce the national debt.

On November 13,^, 2013, Bruce Reed left as Biden’s chief of staff to become the first President of The Broad Foundation. The website Inside Philanthropy said this appointment made him “one of the powerful people in education philanthropy.” In an interview in the Los Angeles Times on March 13, 2014, about his agenda with the Broad Foundation, Reed gave the standard boilerplate of corporate education reform. This is someone who has never taught a day in his life at any grade level nor had any background in pedagogy or education.

After announcing her run for President on April 12, 2015, Hillary Clinton met with the leadership of the American Federation of Teachers and the National Education Association in June. She sought to distance herself from her support of No Child Left Behind when she was a Senator in 2001. While she was an early critic of standardized testing, her position seems to shift by which way the political winds are blowing. Given her history with the Broad Foundation, can there be any illusions that she will continue the neoliberal attack on public education? It has been reported that 181 Clinton Foundation donors lobbied the State Department when she was Secretary of State. The two top donors were leaders in corporate education reform: The Microsoft/Gates Foundation ($26,000,000) and the Walmart/Walton Family Foundation ($10,500,00).

Nor can the union leaders be trusted to represent the interests of their members. Randi Weingarten in particular has a history with the Broad Foundation going back to 2002. This collaboration has continued ever since.

In the 2009/2010 Annual Report (Page 10), the Broad Foundation said,

“Teacher unions have always been a formidable voice in public education. We decided at the onset of our work to invest in smart, progressive labor leaders like Randi Weingarten, head of the United Federation of Teachers in New York City for more than a decade and now president of the American Federation of Teachers (AFT). We partnered with Weingarten to fund two union-run charter schools in Brooklyn and to fund New York City’s first incentive-based compensation program for schools, as well as the AFT’s Innovation Fund. We had previously helped advance pay for performance programs in Denver and Houston, but we were particularly encouraged to see New York City embrace the plan.” 

In 2010 she collaborated with the Gates Foundation to develop a teacher evaluation system based on standardized tests, testifying before Congress three times in support of the effort. A recent study noted the increasing convergence of the goals of Bill Gates and Eli Broad. Randi Weingarten has been collaborating with both. For several years, she has been a leader in the Clinton Global Initiative conferences that bring together corporate and union leaders to foster collaboration in promoting a neoliberal agenda nationally and internationally.

Unless the 99% gets its act together and launches a serious political challenge to the two-party system with a party with a program that represents the interests of the 99%, the November 2016 election will once again be a choice between the lesser of two evils. The problem is the evil just keeps getting worse.

Also see:

AFT Endorses Hillary
Diane Ravitch's Blog - July 11, 2015
Read the comments.

Bill Clinton Is Sorry For A Lot of Things
Huffington Post - July 17, 2015

Why Bill Clinton's Apology and Barack Obama's Prison Drive-By, Token Clemencies Are Cynical Election Year Posturing
Black Agenda Report - July 17, 2015

Ignored, Uninformed and for the GOP, Crazy for Charters: Presidential Candidates Get an F Grade on K-12 Public Education
Alternet - March 24, 2016