Web Only / Features » June 3, 2019
The DNC’s New Finance Chair Embodies Everything the Left Hates About the Democratic Establishment
It’s not just his past criticisms of Bernie Sanders: Chris Korge has a long history of undermining the party’s progressive wing.
While Korge hasn’t been a lobbyist for some time, the appointment of someone with his history to the DNC may well rub up against the organization’s attempt to rebrand in the wake of 2016.
On May 5, Chris Korge was chosen to replace Henry Muñoz as the new finance chair of the Democratic National Committee (DNC).
Recent news reports have described Korge as a “Miami attorney” and a “top fundraiser.” Other titles Korge has carried have included “big-time lobbyist,” “retail czar” and “king of the airport lobbyists.”
Korge’s appointment has already sparked a small controversy, after a donation to Kamala Harris’ campaign and some old tweets of his that were critical of Bernie Sanders—including one claiming that the “only Bern the middle class will feel from Bernie is the pain from all the tax increases”—sparked concerns his presence in the DNC would augur a repeat of 2016 when the DNC was accused of harboring an anti-Sanders bias.
But there are other reasons Korge’s appointment may inspire concern from progressives. At a time when the DNC is attempting to shed a reputation of backing conservative candidates, engaging in pay-to-play politics and being subject to corporate influence, its new finance chairman embodies these trends.
Korge’s political influence and connections were forged through more than a decade of influence peddling in Miami-Dade County that virtually melded his political work with his and the city’s business. And while he’s not a lobbyist anymore, Korge remains a prominent businessman in the state whose fortunes depend partly on the favor of local elected officials.
Since the 1990s, Korge has been a leading fundraiser and something of a Democratic kingmaker in Florida—a crucial state for the party. Korge has used his corporate connections and fundraising power to both promote candidates and gain the ears of successive presidents. For much of that time, Korge also served as a lobbyist, using those same connections to secure lucrative deals for his clients.
Throughout much of his career, Korge's rise and influence has often been linked to the political success of Alex Penelas, a Cuban-American councilman for the Florida city of Hialeah who served as the mayor of Miami-Dade County from 1996 to 2004. (Penelas, now a lobbyist, is running for mayor again in 2020.)
Penelas is remembered today largely for the numerous allegations of corruption that dogged his time as mayor and diminished public trust in the county government, many of which centered around his relationship to Korge. Before that, Korge was one of several lobbyists who moonlit as Penelas' top fundraisers for his successful 1990 bid for county commissioner. During that campaign, Penelas pummeled his opponent for having ties to lobbyists.
Korge’s connection to Penelas quickly became a point of controversy. During a December 1991 debate among commissioners over how to dole out an extra $48 million of tax money, Penelas was accused by fellow commissioner Joe Gersten of doing Korge’s bidding when he pushed to bestow an added $350,000 a year to the Miami Arena. At the time, Korge was one of three registered lobbyists for arena managers. “If you don’t like Chris Korge, say it, for God’s sake!” Penelas shouted, according to reports. “I think the issue is, you do like Chris Korge,” Gersten replied.
In the following years, Korge lobbied for several clients working against the interests of city government and the people it represented. Korge was one of the go-to lobbyists for a number of companies that wanted to delay impending new safety standards for hurricane shutters in April 1994.
In 1995 he helped local golfing legend Charlie DeLucca secure what was described as a “sweetheart deal” and “giveaway.” The deal saw the city spend nearly $4 million to renovate the Melreese Golf Course, before handing over a 30-year lease to private developers who would pay $275,000 a year in rent, while the city paid $300,000 a year to pay for improvements. Under the deal, the city would only start making a profit off of the course after 17 years. The same year, he acted as part of, in the words of the Miami Herald, a “Dream Team of Dade lobbyists,” working to privatize the county’s water and sewer department to the chagrin of unions and the department's employees.
“The secret to becoming influential is the willingness to support something you believe in,” Korge later said. “A lot of times, people don't want to take the chance of being on someone's side.”
By the mid-1990s, Korge had acquired a reputation as one of the most politically powerful people not just in the county, but all of South Florida. Through high-priced events that brought donors together with local and other Democratic officials, Korge quickly became one of the DNC’s major fundraisers. Then-president Bill Clinton stopped by for dinner at Korge’s Pinecrest home in 1997, and Korge even stayed the night at the White House.
“There are probably a dozen dealmakers in this town, then there are 30 or 40 wannabes,” Maurice Ferre, the former mayor of Miami, later said. “The king of them all is Chris Korge.”
Korge worked to maintain his influence. Though publicly expressing ambivalence toward lobbying (“Not very much,” he replied when asked in 1998 if he liked being a lobbyist), he joined a lobbyist-led effort in 1998 to derail proposed lobbying reforms, including lobbyist disclosure requirements for companies wanting to do business with the county, which would have brought a measure of transparency to the influence peddling endemic to the county government. He later spoke out against a proposal to make County Hall lobbyists disclose how much their clients were paying them.
By this time, Korge’s relationship with Penelas—for whose successful mayoral campaign Korge had raised $2.4 million—came increasingly under scrutiny. A sworn deposition by a Penelas aide in a 1998 civil suit against the county revealed the degree to which business interests held sway in his office. The aide testified that Penelas regularly sought advice from an informal circle of friends, family, businesspeople and fundraisers, including Korge.
After former county manager Armando Vidal was fired by Penelas in 1998 over charges of corruption, Vidal claimed he had been pressured to approve a no-bid contract for gift stores and newsstands at Miami International Airport (MIA) for Sirgany/Century. Sirgany had several connections to the mayor's office, including Korge, who had not only worked in the company’s warehouse in his teens, but now counted it as a client.
The lucrative Sirgany contract—which gave the company control of 19 newsstands at MIA, or more than half of its available retail space, for another five years—became a consistent source of scandal for Penelas. A series of investigations by the Miami Herald in 1999 revealed the extent to which political cronyism dominated at MIA, centering around Korge, whom the paper described as “the airport’s unofficial retail czar.”
Korge, it turned out, counted as clients all four major concession operators at MIA, who controlled approximately 90 percent of food and shopping space at the airport, a stranglehold they’d held since 1992. When MIA had put newsstands out for bid that year, Sirgany had twice lost out in evaluations by airport staff. The Miami-Dade County Commission overruled them, with Penelas, then a commissioner, pushing for an immediate vote that ended with Sirgany scoring a 10-year deal. According to the Herald, Penelas went against staff recommendations three times to support Korge’s clients’ MIA bids.
Once Penelas won his election, Korge was known to drop references to the new mayor’s office and what it was supposedly comfortable with while pushing his clients' interests, unwittingly backed up by Penelas. “I've heard that many times, and I have expressed my displeasure on many, many occasions,” he told the Herald. Many of the deals held by Korge’s clients saw no other bidders, and one consultant for Disney complained he had spent three years trying to make inroads into the airport before giving up, concluding “that fighting Chris Korge was not worthwhile.”
Further Herald investigations in the 2000s turned the matter into yet another headache for Penelas. Dade Aviation Consultants (DAC), a Korge client that Penelas had convinced the Commission to grant a $15 million-a-year contract to in exchange for overseeing the MIA’s expansion, was found to have paid $1.3 million worth of fees to Korge and other lobbyists whom it kept on retainer. This $1.3 million was essentially public money, since DAC got its revenue from not just the contract, but landing fees paid by airlines.
DAC was being habitually shaken down by Penelas, Korge and other officials and lobbyists to pitch in money for campaigns and other causes. At one point, Penelas and Korge requested that DAC give $50,000 to the DNC. A report by the county’s Office of the Inspector General that reviewed DAC’s performance over 10 years of its contract found not only that the company had no method to record and measure its work, but that $2.9 million could have been saved every year by simply having airport staff do the same work.
The issue flared up again in 2002, when the Herald uncovered that Host Marriott Services Corp (HMSC), a Korge client that had secured a 10-year concessions contract at MIA on the condition that it operated with minority partners, had been paying those partners tens of thousands of dollars a month to pretend they were running eight restaurants. In fact, HMSC was operating all the concessions, while those involved produced records and reports falsely claiming millions of dollars worth of sales. The partners in turn kicked 10 percent of the monthly sum from HMSC to Korge, who had organized the arrangement.
“In the voluminous annals of airport sleaze, the Host Marriott deal will go down as a classic,” wrote the Herald’s Carl Hiaasen.
The case sparked a years-long joint corruption probe by the Miami-Dade Police, the FBI and the U.S. Attorney’s Office that resulted in no indictments. Miami-Dade Police Director Carlos Alvarez pulled his detectives off the case in November 2003 even as he said it was “clear-cut” that laws had been broken, charging that the U.S. Attorney was hesitant to bring charges in a case involving so many powerful political players. The case may well have helped torpedo Penelas’ bid for Senate in 2004, however, which Korge, as one of Penelas’ closest political confidantes, was involved in.
This kind of influence peddling wasn’t limited to the MIA either, as Korge’s clients appeared to miraculously beat the competition in other areas of city business. In 1999, when the Commission had to decide between a $19 million bid from BellSouth to provide pay telephone services in county facilities and a $50 million offer from AT&T, the Commission chose BellSouth, Korge’s client, even though it meant far less money for the county (BellSouth later donated generously to the Gore campaign). In 2001, the Commission rejected appeals for new bids on a government transit program, with disabled residents who relied on the service complaining the operator at the time, Korge’s client, Advanced Transportation Solutions, provided a dreadful service that regularly arrived hours late, even just to ride a few miles.
Korge’s rising political fortunes were stalled by Al Gore’s loss to George W. Bush in 2000. He chose to consolidate his influence within the Democratic Party, having spent the preceding years raising millions of dollars for both the DNC and the Gore campaign, while further ingratiating himself to the Clintons. Besides staying the night at the White House, Korge hosted then-President Bill Clinton for a viewing of the first presidential debate between Bush and Gore, and he turned his fundraising prowess to Hillary Clinton’s 2000 Senate campaign.
Korge used his influence in Democratic politics, and within Florida in particular, to support and recruit centrist to conservative candidates. In 2001, he convinced former U.S. Ambassador to Vietnam Pete Peterson, a former fighter pilot and POW with a centrist record in Congress, to run against Jeb Bush for governor, before Peterson bowed out a few months later, citing the “war on terror.” In 2006, he backed Rod Smith in the Democratic primary for governor of Florida, who received an A rating from the NRA and had co-sponsored “stand your ground” legislation, and was opposed by environmentalists for his closeness to agribusiness.
“I told him, ‘Listen, You're wasting your time,’” Korge told the Orlando Sentinel in 2006 about meeting Smith. “But by the time he left, not only was I giving him checks and getting involved, but I was convinced that he could win the general election.”
Another figure on the receiving end of Korge’s generosity was a young Marco Rubio, who received $500 from Korge in 1999 for his campaign for state representative in the 111th district. Korge did not donate to Rubio’s Democratic opponent, Anastasia Garcia.
In 2008, Korge served as a key figure in Hillary Clinton’s presidential campaign, at one point raising $1 million for her in a single night. When she lost the primary, Korge became a top bundler for Barack Obama, a position he was disappointed to find came with less access than that of his relationship with the Clintons.
“I’ve had almost no communication with the White House,” he complained to the Washington Post in 2009 after raising $5.5 million for the Obama campaign.
Korge raised funds for Obama again in 2012, and most recently was involved in Andrew Gillum’s unsuccessful bid for governor in 2018. As late as March 2019, Korge and a handful of other top Democratic donors were waiting for former Virginia Gov. Terry McAuliffe, who Korge has known for more than three decades, to enter the 2020 presidential contest. Like Korge, McAuliffe was a former lobbyist and major Democratic fundraiser who’s had his own brush with the law and has represented some unseemly clients. McAuliffe has praised Korge’s selection as DNC finance chair.
Despite leaving behind the lobbying game more than a decade ago, Korge has maintained a link to his past. Besides working as an attorney and real estate developer, Korge is the chairman of NewsLink, an airport concession business formed in 2004 that operates in several different airports in Florida and the Northeast, including MIA. When MIA executives urged the commission to finally open new bids for shops and restaurants in 2012, NewsLink fiercely opposed the move, with its president and CEO declaring that “this is not the time to go to public solicitation.” Ironically, Korge and NewsLink complained years later when businesses with government connections received no-bid contracts with the MIA.
In 2017, Korge, arguing that construction and train delays at MIA had led to lost revenue for NewsLink, requested a lease extension and a kiosk as compensation, a request denied by the airport. Korge did what he had always done: he took his request to the mayor’s office instead. In an earlier time, when Penelas was mayor and Korge was king of county lobbyists, it may well have been fast-tracked and approved. This time, Korge had to wait in line like everyone else.
The following year, Korge opposed county legislation that would have forced concession operators to pay a “living wage” of up to $15 an hour, despite NewsLink generating $55 million of revenue in 2016. “We couldn't pay a living wage,” he told the Miami Herald.
While Korge hasn’t been a lobbyist for some time, the appointment of someone with his history to the DNC may well rub up against the organization’s attempt to rebrand in the wake of 2016, when it faced accusations of pay-to-play and was criticized for blurring the line between public service and private enrichment.
Perhaps none of this will ultimately matter to the party’s base and voters in general as long as Korge keeps the money flowing. The real test will come in August, when the DNC votes on whether or not to keep Korge on as finance chair.
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Branko Marcetic is a staff writer at Jacobin magazine and a 2019-2020 Leonard C. Goodman Institute for Investigative Reporting fellow. He is working on a forthcoming book about Joe Biden.
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