Free Trade, Lobbying, and Grants

Here’s a not-so-oldie—but definitely a goodie.

You might recall that six Republican Congressmen wrote the IRS Inspector General in April asking for an investigation into whether HSUS’s lobbying activity is permissible under the rules for nonprofits. It turns out that this isn’t the only time that HSUS has run afoul of Congressmen.

In 2005, a group of 14 Democratic Congressmen wrote the Government Accountability Office’s Comptroller General demanding an investigation into a $500,000 grant paid from USAID (a government agency) to the Humane Society of the United States. According to their letter, the grant money may have funded illegal lobbying in favor of the Central American Free Trade Agreement (CAFTA).

Here’s how it allegedly went down: USAID gave $500,000 to HSUS in October, 2003. Humane Society International used the money to open an office in Costa Rica called the Global Alliance for Humane Sustainable Development. Later, the head of HSI testified in favor of CAFTA in front of the Senate, and the Global Alliance lobbied in favor of CAFTA in early 2005.

The problem is that it’s illegal for government funds to be used to lobby the government. But these Congressmen alleged that the $500,000 grant money "ultimately funded a letter written to the Office of the United States Trade Representative (USTR) in support of CAFTA."

What raised eyebrows was that HSUS had previously opposed major free-trade legislation, including NAFTA and normalization of trade relations with China. In fact, according to the papers of the late former HSUS board member Amy Freeman Lee, HSUS “work[ed] closely with ... The Sierra Club, Greenpeace, and Friends of the Earth” to water down NAFTA—especially concerning animal-related federal laws that they thought NAFTA might supersede.

What happened from NAFTA to CAFTA? Did HSUS’s leaders have a change of heart? Or did they engage in a cynical political move by backing up a bill that was due for a close vote? (This is Washington, after all—it’s hard to be too cynical.)

These 14 Democrats smelled something rotten. To our knowledge, nothing improper was ever found to have occurred. The GAO told us that it "did not issue an opinion concerning this matter. GAO was unable to develop any information regarding these allegations." Still, it goes to show that skepticism of HSUS can be a bipartisan issue.

The Visual HSUS, Part 10

Imagine you hold public office at the federal, state, or local level, and a lobbyist comes into your office. That’s nothing notable—but if he tells you his group has 11 million supporters nationwide, you’re going to sit up in your chair and listen to what he has to say. It certainly may push you off the fence on an issue.

HSUS is waving a big stick in front of lawmakers’ faces. HSUS claims that it has 11 million “members and constituents” and, in one recent instance, that it is “backed by” 12 million Americans. Any organization should be expected to engage in a good bit of puffery, but this is ridiculous.

That’s because HSUS’s own fundraising material demonstrates that the organization has a mere 1.2 million actual members. And HSUS’s tax returns show that its All Animals magazine, which is included with a basic $25 HSUS membership, only has a circulation of 450,000.

Here’s our question: Is HSUS engaging in a little creative accounting?

If you’d like to see the nitty gritty of how we’ve dissected HSUS’s claims of support, read here, here, and here for more.

Did HSUS Violate the Lobbying Disclosure Act?

That’s not a rhetorical question. In fact, it’s at the heart of a new complaint against the Humane Society of the United States (HSUS—not affiliated with your local humane society). And it’s brought by a man who’s been a thorn in the side of the animal rights group: Frank Losey.

We interviewed Losey last year about another campaign he’s running called “Spay and Neuter the HSUS.” In that campaign, Losey targets HSUS’s lobbying activities, arguing that they may go past the legal limits imposed on 501(c)(3) nonprofit organizations. All charities can engage in a limited amount of direct and indirect lobbying, but too much lobbying can be grounds for the IRS to revoke a group’s nonprofit status. Losey found that between 2004 and 2008 HSUS had engaged in 2,000 distinct lobbying activities.

Several Congressmen have also piled on the effort to get the IRS to investigate HSUS. If this effort succeeds, there could be earth-shattering fallout. The IRS is not something to be messed with. Just try not paying your taxes and see what happens (or read up on Al Capone).

So what’s Losey’s latest complaint?