EDITORIAL: The civil rights shakedown: myth or reality?

By Deneen Borelli | Saturday, August 2, 2008

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Al Sharpton is making headlines again, but it's not for one of his crusades. Instead, Mr. Sharpton, his National Action Network (NAN) and several major corporations that have donated to NAN have been subpoenaed in recent months by federal investigators. While Mr. Sharpton's attorneys reported Tuesday that the criminal probe over millions of dollars supposedly owed in taxes by Mr. Sharpton and NAN has been dropped in lieu of civil action by the IRS, federal authorities remain tight-lipped over the status of any investigations.

Critics have long accused Mr. Sharpton of obtaining corporate contributions by threatening racial boycotts. He denies this, saying "That's the old shakedown theory that the anti-civil-rights forces have used against us forever."

But there is plenty to wonder about. In November 2003, according to the New York Post, Mr. Sharpton picketed a DaimlerChrysler air show, threatening a boycott. After the company began sponsoring NAN's annual conference in 2004, however, the reverend bestowed an award on it for corporate excellence. General Motors and American Honda also began giving to the group after similar threats.

Mr. Sharpton is not alone. Critics of Jesse Jackson claim he has perfected the art of the shakedown. Suspicions persist, for instance, about motives behind repeated generous contributions from mortgage giant Freddie Mac to Jackson's Rainbow/PUSH Coalition. As the National Legal and Policy Center has reported, "Jesse Jackson's relationship with Freddie Mac began in 1998 when Jackson accused Freddie Mac of racial discrimination and encouraged major shareholders to sell their stock. Freddie Mac began financial support for Jackson's organizations and his criticism of Freddie Mac stopped." Freddie Mac donated $150,000 to a Rainbow/PUSH conference earlier this month, even as Congress was debating a bailout of the struggling firm and Fannie Mae, a bailout that the Congressional Budget Office says might cost taxpayers as much as $100 billion.

A 16-year crusade against Anheuser-Busch for not having enough minority beer distributors ended with Mr. Jackson's sons being awarded a lucrative Chicago distributorship. Businesses that Mr. Jackson has criticized, including Toyota and NASCAR, have become sponsors of his annual Wall Street Conference.

At this year's annual shareholder meeting of the JPMorgan Chase & Company financial services firm, I observed Mr. Jackson in action. During the meeting's question-and-answer session, he pressed JPMorgan CEO Jamie Dimon about the company's commitment to diversity. Mr. Jackson asked Mr. Dimon how much of the $750 million spent on a recent merger went to minority contractors. As Mr. Jackson bluntly put it: "How much of that was done by black and brown lawyers?"

While Mr. Dimon could not specify a dollar amount, he emphasized that JPMorgan's support of minority contractors has increased, as has the percentage of minorities in senior management positions. Mr. Dimon could have not been surprised to see Mr. Jackson. This February, the reverend called Mr. Dimon about JPMorgan's role in the then-upcoming initial public offering (IPO) of credit card giant Visa Inc.

In a follow-up letter to Mr. Dimon, Mr. Jackson wrote, "It is our understanding that just four minority firms are involved in the IPO syndicate at the third tier level, none as co-managers or even junior co-managers... This is a major step backward for Wall Street and its commitment to inclusion... There must be some sense of 'equanomics' [a Jackson term marrying "racial justice" to "economic equality"] in the IPO deal - which the representation of minority investment banking firms compares favorably to our consumer use of credit cards," he said.

Frustrated by what appears to me to be a long history of Mr. Jackson and Mr. Sharpton using semi-subtle campaigns to pressure corporations to donate, I spoke up at the JPMorgan shareholder meeting.

After Mr. Jackson spoke, I took his place at the microphone and asked Mr. Dimon and his board: "Will there ever be a day where you will stand up and say 'No' to Mr. Jackson and to his demands and messages of victimization and divisiveness? This is the United States of America, and this is not the 1960s. People should be hired based on their talents and they should be retained based on their results. There should not be color-coded hiring in the United States."

Shareholders clapped. But, unlike Mr. Jackson's, my question went unanswered.

Deneen Borelli is a fellow for the Project 21 black leadership network

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