May 18 (Bloomberg) -- For two years, Joe Ricketts has been building a political operation seeking to curb government spending that could have reached a crescendo in August with an unexpected, multimillion dollar attack on President Barack Obama.
The admission by a Ricketts’ spokesman yesterday that one proposed advertising campaign focused on the president’s relationship with a Chicago preacher known for racially charged sermons removed the element of surprise, increased scrutiny of his political activity and put at a negotiating disadvantage one of the Ricketts family’s prized possessions -- the Chicago Cubs.
“Not only was this plan merely a proposal -- one of several submitted to the Ending Spending Action Fund by third-party vendors -- but it reflects an approach to politics that Mr. Ricketts rejects, and it was never a plan to be accepted but only a suggestion for a direction to take,” Brian Baker, president of the group, said in a statement issued on Ricketts’ behalf.
The denunciation of the proposal underscores the risks some wealthy donors, freed by the U.S. Supreme Court in 2010 to spend unlimited amounts of money on politics, are taking as they use their fortunes to drive election outcomes.
The Ricketts’ standing in Chicago, Obama’s hometown and a city dominated by Democrats, is diminished at a time they are looking for political and financial support to make renovations to 98-year-old Wrigley Field baseball stadium and the neighborhood around it.
Chicago Mayor Rahm Emanuel, a former Obama chief of staff, was said to be livid when he heard of the ad proposal and is refusing to return the family’s phone calls, even with their quickly issued statements repudiating the plan, according to an aide who wasn’t authorized to speak on the record.
“Some of the plans for Wrigley are controversial already,” said Dick Simpson, a political science professor at the University of Illinois at Chicago and a former city alderman. “It would make it easy for other aldermen in that particular case to vote it down.”
It’s an outcome that Ricketts, 70, the founder of TD Ameritrade Holding Corp., hardly could have foreseen when rising debts and deficits in Washington prompted him to step up his political engagement.
“It’s a crime for our elected officials to borrow money today, to spend money today and push the repayment of that loan out into the future on people who are not even born yet,” Ricketts said in a video uploaded to YouTube in September 2010 in which he explains his political thinking.
Explaining His Politics
Sitting before a bookcase and pointing at the camera, he said he was a Democrat until former President Lyndon Johnson’s spending “pushed me out.” He added that he was a Republican until President Bush’s spending -- he doesn’t say whether he’s referring to President George H.W. Bush or President George W. Bush -- turned him off. He’s now a registered independent, he said in the video.
Ricketts is a Nebraska native who now lives in Little Jackson Hole, Wyoming. He graduated from Creighton University with an economics degree in 1968, according to a biography on his website, and began his professional career as an investment adviser with Ricketts & Co. In 1975, he co-founded First Omaha Securities, a retail securities brokerage in Omaha.
Under his leadership, his website says, First Omaha Securities recognized early the potential of the discount securities market.
The company grew and evolved into TD Ameritrade, which today manages hundreds of billions of dollars in client assets. He served as chief executive officer of Ameritrade Holding Corp. from 1982 to 2001 and chairman from 1982 to 2008.
In 2009, Forbes magazine ranked him as the 371st wealthiest American with a net worth of $1 billion.
The Ricketts family, the eighth ownership group in the 136-year history of the Cubs, acquired a 95 percent controlling interest in the team, Wrigley Field and 25 percent of Comcast Sportsnet Chicago in 2009. Joe Ricketts’ children -- Pete, Tom, Laura and Todd -- are on the board.
In September 2010, Ricketts, who’d been a long-time Republican donor, began taking a more direct role in politics by founding a nonprofit group to oppose politicians who supported earmarks, designated funding for special projects in their districts. The organization was called Taxpayers Against Earmarks Inc. It raised almost $1.3 million in 2010, according to tax records. The group later changed its name to Ending Spending Inc.
A month later, he filed paperwork with the Federal Election Commission to create a super-PAC, which can take unlimited donations, that would support the mission of the nonprofit.
Ricketts was the super-PAC’s lone contributor, writing two checks totaling about $1.2 million, FEC records show. The committee ran television ads attacking three Democrats -- Senate Majority Leader Harry Reid of Nevada, Texas Representative Chet Edwards and South Carolina Representative John Spratt -- for being part of Washington’s “pay to play” culture. Edwards, a U.S. House member since 1991, and Spratt, in office since 1983, lost.
A radio ad in support of a fourth Democrat, Representative Walter Minnick of Idaho, urged voters to re-elect him because “he understands that we can’t afford wasteful spending” and “called on both parties to pass a permanent ban on earmarks.” Minnick lost.
The two organizations remained dormant until late last year when Ending Spending, the nonprofit, produced web videos featuring interviews with each of the Republican primary candidates for president. In them, the candidates discuss their plans for cutting government spending and addressing the federal deficit. He gave the maximum -- $2,500 -- to each of the candidates.
A 30-second television ad aired by Ricketts directs viewers to the group’s website and doesn’t endorse a specific candidate. He paid $357,545 to put the spot on television, an FEC disclosure report shows.
Ricketts’ activities weren’t confined to the presidential.
In December 2011, he wrote a $500,000 check to the Campaign for Primary Accountability, a group that wants to unseat incumbents, both Democrats and Republicans.
This week, his super-PAC dropped an unexpected $250,000 on ads supporting a little-known Nebraska rancher running in the Republican Senate primary; she’d also received the endorsement of former Alaska Governor Sarah Palin. One 30-second spot highlighted the “surprise” element of the rise of the “conservative outsider” and touted the Palin endorsement.
State Senator Deb Fischer became the upset winner in that race and will advance to November’s general election against former U.S. Senator Bob Kerrey, a Democrat.
Ricketts also is investing $245,000 to fight against the recall of Republican Wisconsin Governor Scott Walker, state campaign-finance records show.
“Courage is on the ballot,” the narrator says in an ad that began airing May 10 in Milwaukee, according to New York-based Kantar Media’s CMAG, a political ad tracker. “Scott Walker did what he was elected to do.”
The Wyoming investor’s plan for an August ad buy linking Obama to Chicago Reverend Jeremiah Wright Jr. was first reported by the New York Times yesterday. That forced presumptive Republican nominee Mitt Romney to repudiate the strategy and sent the Ricketts family rushing to make amends with Chicago’s Democratic hierarchy.
Plans for Wrigley
The Cubs team, which claimed back-to-back World Series titles in 1907 and 1908 and hasn’t won the championship since, is seeking support for a proposal to relax Wrigley’s landmark status and boost its advertising and sponsorship revenue.
The possible changes range from more outfield signs to street closings every game day to make space for street fairs. The stadium is among the city’s top tourist attractions.
The team also wants to use about $200 million in projected growth from existing amusement taxes to construct a building near the stadium to house its offices, a restaurant, parking, hall of fame, pro-shop and ticket windows.
Dennis Culloton, a spokesman for the Ricketts family, dismissed suggestions that the political activity of Joe Ricketts will be harmful to the stadium proposal.
“You would hope that people will look at all the facts, and look at the fact that Tom, as chairman of the Cubs, has nothing to do with his father’s political activity,” he said.
Keeping His Distance
Culloton issued a statement for Tom Ricketts that sought to distance him from the ad campaign proposal. “As chairman of the Chicago Cubs, I repudiate any return to racially divisive issues in this year’s presidential campaign or in any setting -- like my father has,” he said in a statement.
Laura Ricketts, a Democrat who has raised at least $500,000 for Obama’s re-election, said in her own statement that members of her family have “different political views on how to achieve what is best for the future of America, but we agree that each of us is entitled to our own views and our right to voice those views.”
Laura Ricketts may have the best chance of delivering that message to the mayor and governor, who will influence the final decisions on the stadium project.
During a joint appearance on April 4 with Illinois Governor Pat Quinn, a Democrat, Emanuel took both sides of the stadium proposal.
“It’s the fourth most-visited tourist attraction in the city of Chicago,” he said. “That said, it’s a private company. They bought it. They bought it in 2009, eyes open, well aware.”
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