Where Tech Companies Spent Millions in Municipal Elections—and Lost

How much political power does $1.5 million buy?

That’s how much Amazon donated to a Seattle Political Action Committee that aims to swing the city council towards a more pro-business agenda. The company, which is headquartered downtown, has influenced the council successfully before, donating $25,000 to a campaign to kill a per-employee head tax that would have gone towards funding homelessness initiatives in the city.

This time, according to early voting results, Amazon didn’t win.

To be fair, it didn’t quite lose, either. Out of the seven city council candidates Amazon supported, four appear poised to win their elections. (One of the four, Jim Pugel, is only leading by a tiny margin.) That’s not quite enough to secure a majority on Seattle’s nine-member council, but enough to move the needle.

Another of the pro-business candidates, Egan Orion, struck a key blow, likely defeating Kshama Sawant, a pro-labor city council member in the Socialist Alternative Party who’s long been a thorn in the side of Amazon and other large corporations. She branded the head tax the “Amazon tax,” and called this week’s election a fight over the “soul of Seattle.” (Supporters note that Sawant came back from a more than seven-point deficit during her last election, and that her fate won’t be assured until all the votes are tallied at the end of this week.)

Framing the stakes of the election, Sawant told the New York Times recently: “The question is: Is Seattle going to become a playground for only the very wealthy, or is it going to be a city that serves the needs of ordinary people?”

Amazon wasn’t the only business that spent big on city campaigns. From San Francisco to Jersey City, tech companies poured money into nudging the outcome of ballot questions on whether to regulate, tax, or expand their power, in some cases contributing to new spending records at the city level. And despite million-dollar campaigns launched by companies like Juul and Airbnb, Amazon wasn’t the only one to see voters defy them.

In San Francisco, a measure that would have overturned the city’s e-cigarette sales ban lost by an overwhelming margin, meaning the moratorium will hold. Initially, venture-backed vape pen company Juul spent $11 million on a campaign to overturn the ban, but it pulled its support before the vote amid public health concerns.

In Jersey City, a bill to regulate the 3,000 Airbnb rentals that locals complain are flooding the city with unruly tourism passed, despite a $4.2 million campaign by the short-term rental platform to defeat it. Airbnb blamed the hotel lobby, which spent only $1 million.

And also in San Francisco, Uber and Lyft took a different strategy: They both supported a small tax of 3.25 percent on most Uber and Lyft rides, introduced as an alternative to a more punitive tax that could have been levied without voter approval. The ride-hailing companies contributed comparatively modest amounts—according to campaign finance records, Lyft donated $400,000 and Uber $300,000—and the initiative was leading slightly as of publication.

Tech-money-fueled campaigns aren’t new in San Francisco. Last year, a tax on businesses to support affordable housing and homelessness not unlike Seattle’s was on the ballot, inspiring entities like Lyft, Stripe, Square, and Twitter founder Jack Dorsey to donate hundreds of thousands each to the effort to defeat it. But in that case, Salesforce and its CEO Mark Benioff also dropped almost $5 billion to pass it. Though the measure was approved by voters, it won by less than a two-thirds margin, and is currently tied up in court.

Amazon’s spending in Seattle was part of a particularly notable phenomenon: The council race was the most expensive in the city’s history, even as it tested the strength of a new initiative intended to curb big money in politics.

Under a “democracy voucher” program that came into effect this year, all registered voters in the city were sent four $25 vouchers to spend on any candidates they wanted to support—but only those who agreed to spend less than $150,000 on their general election campaigns. When business interests in the city banded together with the Chamber of Commerce to start a PAC called Civic Alliance for a Sound Economy (CASE), and the cash started pouring in, candidates who had initially opted into the program asked to opt out, worried they wouldn’t be able to compete without hustling for more money.

By Election Day, the New York Times reported that “11 of the 12 general election candidates who participated in the voucher program had been released from the limits.” CASE pulled in more than $4 million, with a quarter coming from Amazon, and the rest from other companies with Seattle-area offices, like Google, Expedia, Starbucks and Microsoft.

M. Lorena González, one of two council members who represents the entire city and wasn’t up for reelection this year, is sponsoring a bill that would tighten campaign finance restrictions even more, limiting the amount corporations can donate to PACs, and effectively abolishing super PACs like the Chamber of Commerce’s CASE.

“We operate in an environment where corporations like Amazon can make unlimited contributions, because there are no regulations,” she told CityLab. “As a result you saw them put a fistful of cash on the scales of democracy to tip the city council in their favor.”

Even presidential candidates Bernie Sanders and Elizabeth Warren condemned Amazon’s spending. “In a city struggling with homelessness, Amazon is dropping an outrageous amount of money to defeat progressive candidates fighting for working people,” Sanders tweeted.

CASE argues that the candidates it endorsed will not only be good for business, but for the city: Its website says they all “demonstrate a strong commitment to improving the quality of life and economic opportunities for all Seattleites,” particularly when it comes to easing traffic congestion and improving transit, instituting systemic reforms around homelessness, and supporting local business growth. Polls conducted by the Chamber and local newspapers showed that residents were disappointed with the current council, and ready for change.

González noted that what aligns several of the CASE-endorsed candidates is also an emphasis on maintaining Seattle’s “regressive tax system,” “using punitive criminal justice system tools to address homelessness,” and “not tackling criminal justice reform as a whole.” (CASE didn’t respond to a request for comment.)

With Amazon achieving less than a majority hold on the council, the takeaway some Seattle progressives left with Wednesday was that it could have been worse. “Imagine the Chamber and Amazon honchos this morning looking at City Council strategy for next year,” Seattle’s former Democratic mayor, Mike McGinn, tweeted. “Those business honchos are not sitting there clapping each other on the back saying ‘We killed it last night!’ They’re saying ‘crap—how the hell do we get to five votes on anything—we have completely lost control of the council.’” He added that during his term as mayor from 2010 to 2013, the Chamber of Commerce held seven of the nine seats, giving it a stronger pro-business bent.

But Amazon’s intervention shows that its interest in—and impact on—politics is only growing in the wake of the struggle over the head tax. On city council candidates, Amazon only spent $130,000 in 2015, according to campaign finance records, meaning their spending increased by more than 650 percent this year. (According to WUSA9, Amazon also spent almost $300,000 on Republican and Democratic house and senate races in Virginia, the state where it’s planning another large campus.)

And its spending is not always in opposition to funding public initiatives. This year, the company contributed $400,000 at the state level to join progressives in opposing a cut to car registration fees that would slash transit funding precipitously (Microsoft spent $650,000). Despite their opposition, it looks like the measure is going to pass.

This spring, the power of big spending will likely be tested again. California’s bill reclassifying gig workers as employees—which could pose an existential threat to sharing-economy companies like Uber and Lyft—could be challenged in a ballot measure funded by the two ride-hailing companies and Postmates, a fooddelivery app. Together, they’ve already contributed $90 million to the effort. That’s 60 Seattle city councils worth.

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Density Increasingly Decides State Elections, Too

Tuesday’s election results show how America is continuing to polarize along an urban-rural continuum. But it’s not playing out the same everywhere.

Voters on Tuesday gave Democrats a resounding victory in races for Virginia’s general assembly, a narrow victory in Kentucky’s gubernatorial election, and a defeat in Mississippi’s gubernatorial race. All three states show signs of ongoing polarization, in which rural areas are becoming more Republican and suburban areas are becoming more Democratic.

In Virginia, for example, the same suburban surge that powered Democrats to victory in 2018’s congressional races was also evident a year later at the state level. Based on a density index devised by CityLab to analyze elections, Democrats on Tuesday won an average of 73 percent of the vote in districts that CityLab categorizes as “dense suburban,” and 53 percent in “sparse suburban” districts.1 But eight years ago, Democrats averaged just 46 percent of the vote in “dense suburban” districts, and were blown out with an average of 22 percent of the vote in “sparse suburban” districts.

Likewise,  rural districts saw a hard turn toward Republicans. In 2011, Democrats averaged 32 percent of the vote in predominantly rural districts—roughly in line with their overall 34 percent of the vote. In 2019, Democrats did much better overall, winning nearly 53 percent of the total vote. But their share in rural districts fell to 27 percent.

Virginia is a fast-growing state with large shares of its population living in dense urban and especially suburban neighborhoods, and is overall much less rural than either Kentucky or Mississippi.

That means that Kentucky’s Democratic governor-elect Andy Beshear had to assemble a very different coalition to win there than Virginia’s Democrats did. Like them, he ran up big margins in the state’s cities and suburbs, and lost big in rural areas (though he lost by less in the country).

But whereas Virginia Democrats tended to do worse in districts where more people live in low-density communities like exurbs or rural towns, those areas were a strength for Beshear in his race against incumbent Republican Governor Matt Bevin. They had to be in order for him to win—Kentucky doesn’t have enough people living in dense communities for a candidate to lose in both rural and exurban areas and still pull off a victory, whereas Virginia does.

Despite these differences, though, Kentucky showed the same patterns as Virginia. Compared to Bevin’s victory over Democrat Jack Conway four years ago, Beshear did worse in counties with lots of rural residents, but better in counties with more people living in towns, suburbs, and cities.2 The differences are even more dramatic when compared to 2011, when Beshear’s father Steve was re-elected governor. Steve Beshear had only a minor disadvantage in Kentucky’s rural areas then, and smaller advantages than his son would produce in its denser communities.

In Mississippi, where Attorney General Jim Hood came up well short in his race against Republican Tate Reeves, demographics posed an even graver problem. Mississippi is one of the most rural and least suburban states in the country, and is the only state without a single neighborhood that CityLab classifies as “high density.”3 In every respect it’s less urban than Kentucky, where Beshear only squeaked out a victory on Tuesday by virtue of his opponent’s extremely low approval ratings.

Any election that follows this decade’s patterns of polarization, with Republican rural areas and Democratic suburbs and cities, is going to go poorly for a Democrat in Mississippi because it just doesn’t have enough suburbs and cities. And so Hood fell with 46.6 percent of the vote to Hood’s 52.1 percent.

There’s no guarantee that this trend will continue to accelerate in 2020 or other future elections. Just a decade ago, Democrats did well in rural, suburban, and urban congressional districts. But if Americans continue to polarize by density, then Democratic wins in rural places like Kentucky may get even rarer—as will Republican wins in suburban places like Virginia.

  1. Using a similar methodology to last year’s CityLab Congressional Density Index, we used a machine learning algorithm to classify districts based on the different types of high-, low-, and medium-density neighborhoods that make them up. A district that’s predominantly medium-density neighborhoods, for example, would be “dense suburban,” while “sparse suburban” districts tend to be mostly low-density neighborhoods with a substantial minority of medium-density.
  2. Bevin underperformed other Republicans on the ticket, who won the rest of Kentucky’s statewide offices. But even those down-ballot races showed similar patterns, just slightly less extreme. Attorney General-elect Daniel Cameron, a Republican, did better in counties with lots of rural residents and worse in counties where lots of people live in denser areas than Republican attorney general candidates in 2015 and 2011. He outperformed Bevin in suburban counties but did a little worse than him in rural counties.
  3. CityLab classifies neighborhoods with fewer than 102 households per square mile as “Very low density.” Neighborhoods with 102 to 800 households per square mile are “Low density,” while those with 800 to 2,213 households per square mile are “Medium density.” Anything above 2,213 households per square mile is “High density.” These numbers are derived from survey research conducted by Jed Kolko.

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Voting in Local Elections Matters. This Is What Cities Can Do.

If you’re worried about the teetering fate of American democracy because of what’s happening at the national level right now, the solution may be local: boosting turnout in local races in 2019 is the best way to prepare voters for the 2020 presidential race and the 2020 census.

While the onslaught of media coverage during presidential elections can make many Americans think voting only happens every four years on that Tuesday in November, each year, a bundle of federal, state and local elections happen concurrently, usually on a federally-sanctioned “Election Day,” this year, that day is Tuesday, November 5th. But critical elections—such as for mayor, council member, clerk, and more—happen all year, every year, often with little fanfare.

How many people are even aware that hundreds of state and local judges are up for election this year? Judges have the ability to influence cultural norms and laws that residents interact with daily, and yet theirs are some of the least-participated-in elections in the country.

For these local elections voter turnout is often extremely low, so even a few voters can make a difference. Yet, in what is supposedly one of the most democratic countries, we can’t get more than half of our population to vote regularly. That’s a dire problem, since voting is the single strongest metric of democratic participation. It’s also the main way to communicate satisfaction—or dissatisfaction—with a representative.

There are reasons why turnout rates in America are some of the lowest of all developed countries. Our voter registration process is complicated and punitive. It’s often difficult to get to our polling locations—particularly if you are a person of color, lower income, or a college student. And our elections are during the work week, when many people can’t afford to take off.

Only 70 percent of eligible Americans are registered to vote, but there are a number of ways that cities can increase democratic participation: City and county agencies that provide social services such as SNAP, affordable housing, and health benefits can offer voter registration assistance in their offices; election administrators can work with high-school voter registration programs to have schools distribute forms to students, and then submit them to election administrators; cities can also incentivize landlords to provide their tenants with voter registration forms, and lobby their states to create same-day registration (states that have it show 10 percent higher voter turnout than states without).

And local leaders can encourage voter turnout. Families with annual incomes below $30,000, people of color, naturalized citizens and young people have an especially low turnout rate. Mayors, as the ultimate local conveners, can make simple investments like creating and printing voter education material for “Know Your Ballot” events that synagogues, churches and mosques have been organizing locally for the last few years. Mayors can also incentivize small businesses to do more than just give time off—and preferably paid time off—to employees by offering a tax credit for including messaging on their receipts about voter registration. Small businesses have a tremendous role in transforming local culture—cities can design and provide banners and posters to decorate their window fronts all the way down Main Street. Mayors can also prioritize breaking down transportation barriers on election day.

There’s precedent for this level of local involvement in voter turnout: In small towns like Lynchburg, Virginia, and large cities like Los Angeles, California, buses and trains are free on election day. Minneapolis encourages young people to serve as poll workers, because they are more likely to be tech-savvy and bilingual and the secondary benefit is that they learn about the importance of voting. Boston is focused on helping community members get involved and engaged by making registration easier when people are renewing parking permits and library cards; at the same time, local high schools in the city have been sharing pre-registration materials with students.

Mayors and other city leaders are also joining networks like “Mayors for Our Lives,” Let America Vote’s “Cap, Gown, Vote!” Tennessee’s Mayors Grow Civic Engagement and NLC’s new Civic Cities initiative. For local leaders dedicated to enacting policy and building partnerships to improve democratic engagement, this is a great first step.

The 2020 elections provide a perfect opportunity for mayors to launch their commitments to full democratic participation. It isn’t only the presidential election that is going to be grabbing headlines around democratic participation. There is another headline-grabbing reason that city leaders need to be extra engaged with their residents this year: the 2020 Census. It only happens once a decade, so it has been 20 years since a Census count and presidential election have occurred in the same cycle.

The Census decides not only how much funding is allocated to every single community in the United States for hospitals, schools and roads, but also congressional representation for the next ten years. It is in every city, town and village’s best interest to count every single resident. And despite the Census being a national operation, it is a distinctly local effort—mayors have the ability to lead the charge on achieving not only full voter participation but also getting a full and total count of their community.

We need to ensure, however, that Americans understand the importance of local elections, and that they have the tools to vote. This year, local elections are, or have been, held in 63 of America’s 100 largest cities. That means that 47.3 million Americans will be influenced. Many other cities, including Houston, South Bend, Indianapolis, and Philadelphia will be voting for mayor this Tuesday.

We always hear about the big national movements, the social media campaigns led by celebrities, and the huge music festivals urging people to vote. But those may not be the best (or only) ways to transform America’s civic engagement and voter turnout. Maybe the key was always going to be small, systemic, and cultural transformations at the municipal level.

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Elections – The Public Good Index

Percent of population making under $50,000 in 2014: 48 percent.

Percent of those voting making under $50,000: 36 percent.

Percent of population making over $100,000: 22 percent.

Percent of those voting making over $100,000: 30 percent.… Read More

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