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The Insta-Conspiracy

The ConWeb quickly latched onto a right-wing claim that Chrysler dealers losing their franchises were disproportionately Republican -- a claim that was just as quickly debunked. But they're too invested in the conspiracy to honestly report the truth.

By Terry Krepel
Posted 6/3/2009

Right-wing bloggers were abuzz last week with news of a conspiracy du jour -- that the Obama administration is deliberately targeting Chrysler dealers for closure whose owners have donated to Republican candidates.

Loath to ignore any opportunity to smear President Obama, the ConWeb was quick to jump on the conspiracy. But even as they reported evidence that debunked the claim, they clung to it anyway.

Newsmax's Ken Timmerman appeared to embrace the conspiracy in a May 27 article -- "Many of the closed dealers were also major donors to Republican candidates and political action committees, a review of campaign finance data from the Federal Election Commission shows" -- but it's not until the latter half of his article that he divulges a major debunking fact:

Auto-dealers as an industry tend to give more to Republican causes than to Democrats, according to an analysis done by Center for Responsive Politics, a nonprofit organization that compiles FEC data and operates the Open Secrets Web site.

During the 2008 election cycle, the center found that auto dealers and their associated political action committees made a total of $9 million in campaign contributions, giving by a 3-to-1 margin to Republicans.

The automobile industry as a whole made $18.5 million in donations in 2008, also breaking roughly 3-to-1 in favor of Republican candidates and causes.

That's right -- the reason it seems that more Republican-supporting Chrysler dealers are losing their franchises is because car dealers as a whole tend to support Republicans. Timmerman offered no evidence that Chrysler dealers losing their franchises are any more or less Republican than that of auto dealers as a whole.

That's a point echoed by's Nate Silver in a May 27 post:

Overall, 88 percent of the contributions from car dealers went to Republican candidates and just 12 percent to Democratic candidates. By comparison, the list of dealers on Doug Ross's list (which I haven't vetted, but I assume is fine) gave 92 percent of their money to Republicans -- not really a significant difference.

There's no conspiracy here, folks -- just some bad math.

It shouldn't be any surprise, by the way, that car dealers tend to vote -- and donate -- Republican. They are usually male, they are usually older (you don't own an auto dealership in your 20s), and they have obvious reasons to be pro-business, pro-tax cut, anti-green energy and anti-labor. Car dealerships need quite a bit of space and will tend to be located in suburban or rural areas.

Then, Timmerman pretended he didn't just debunk the central point of his article and launched back into conspiracy territory:

One company that stands to benefit in a major way from the Chrysler restructuring is called RLJ-McLarty-Landers, a start-up owned by Democratic Party insiders that operates six Chrysler dealerships throughout the South.

Co-owners Robert L. Johnson, founder of Black Entertainment Television, and Mack McLarty, chief of staff to president Bill Clinton, provided capital and political clout to the partnership, which they formed in September 2007.

Johnson is a major donor to Democrat party causes but sharply criticized Obama during the primaries for his admitted drug use as a young man. He later apologized to Obama for the personal attack.

Timmerman seems to have failed to do much research into the RLJ-McLarty-Landers group beyond perusing campaign donations. If he had, he would have learned that McLarty didn't stumble into selling cars a couple years ago by making use of his political connections. McLarty's family has been selling cars since 1921, according to his bio on the RLJ website, and the auto-selling operation had grown into a group of 19 dealers largely located in Arkansas by 1998, when an ownership interest was sold to New York-based Asbury Automotive Group, a publicly held company that's now one of the largest auto retailers in the country. The deal brought McLarty into Asbury's top management; he was later named the company's vice chairman, as well as chairman and CEO of the Arkansas operations, before leaving in 2004 to partner with Steve Landers and, in 2007, Robert Johnson.

Timmerman made no mention at all of the other partner in the group, Steve Landers, yet his presence may very well be the key to why, as he noted, "RLJ-McCarty-Landers will retain all of its six dealerships." Landers is the former owner of a Chrysler dealer in Benton, Ark., that was the world's largest Chrysler dealer for several years. Why would Chrysler sever its relationship with its top dealer?

Further, Landers appears to be a Republican supporter; donation records show that Landers donated $2,000 in 2006 to the Republican Party of Arkansas. (At least, that's who it appears to be, as opposed to his son, Steve Landers Jr., who is listed as donating to the National Automobile Dealers Association PAC.)

WorldNetDaily -- not wanting to be left out of an Obama conspiracy -- jumped on this bandwagon as well. A May 27 article by Chelsea Schilling breathlessly touts the conspiracy while failing to note the fact that, as Timmerman and Silver reported, car dealers as a whole overwhelmingly support Republicans.

The right-leaning Washington Examiner was next to promote the conspiracy with a May 28 column by editorial page editor Mark Tapscott. While Tapscott claimed that the assertions that bubbled up from the right-wing blogosphere "were all couched with important qualifiers," he quickly dismisses them: "That said, when multiple dealers who have been closed are found to have contributed millions to Republicans and mere hundreds to Obama, the serious number-crunching cannot be completed too soon."

But as noted above, auto dealers are disproportionately owned by Republicans, so it's utterly unsurprising that many closing Chrysler dealers are also owned by Republicans.

Tapscott did add an update to the online version of his column citing someone claiming that "more Chrysler dealers in general are likely to be Republican contributors, which would mean more of the closed dealers would be seen to be GOP supporters than Democrat supporters." But he still wants to cling to the conspiracy even as it's discredited before his eyes:

But two points should be noted here. First, even if we accept the proposition that most car dealers are more likely to be Republican than Democratic donors, there would still be a "disparate impact" from closings on one class of dealers, compared to the other. When the federal courts see a disparate impact on racial groups, the policy or action in question is typically held to be inappropriate.

Race and car dealer closings, of course, aren't analogous. But the lesson remains that when government makes economic decisions that ought to be left to the private market, it is impossible to avoid disparate impacts. And there is always the question of would the Obama White House be so quick to close hundreds of dealerships if the owners of those dealerships were predominantly Democratic donors?

Second, since neither Chrysler, nor the White House have made public the criteria used to select dealers for elimination - and because a significant number of those being closed were profitable - the only way to resolve the inevitable controversy about political considerations in political decisions is to make the criteria public and allow independent outside observers to assess how those criteria were applied.

Tapscott wasn't content with echoing one baseless right-wing smear in his column, however -- he also adhered to the dictates of the noise machine by claiming that Obama is acting like a mobster:

In other words, companies that want to prosper in the anti-capitalist world Obama is creating in America will first have to make their peace with Big Labor before heading to Washington hat-and-checkbooks-in-hand to seek favor from the strong men in the White House and their enforcers in the Treasury Department and elsewhere in the executive branch.

Obama calls it “change we can believe in.” Vito Corleone called it “making them an offer they can’t refuse.”

In an even later website update, though, Tapscott acknowledged Silver's analysis -- but like the others, he wasn't ready to abandon his conspiracy:

That's true, of course, but I'm not sure that it ends the discussion. In fact, it may even make the discussion of possible partisan considerations behind the closings even more relevant. Think of it this way: If 88 percent of all car dealers were Democratic contributors, rather than GOPers, how likely is it that the Obama folks would be delivering such an egregious economic blow to the group, a blow that put thousands of people out of work and deprives hundreds of Democratic donors of their means of making contributions?

Next up on the conspiracy bandwagon was NewsBusters, where Mike Sargent ranted in a May 28 post about how the media won't address right-wing blogosphere claims that "many of the Chrysler dealers that have been chosen for closing have made a habit of donating money to Republicans. The right-wing blogosphere, asserted Sargent, "has, once again, proven itself a worthy investigator."

Sargent came close to stumbling over the truth at one point, noting that "One might assume that, since they are small-business owners, they are overwhelmingly supportive of the GOP." Then he quickly adds: "But assumption is not the job of a vigilant press." Of course, Sargent is assuming all of this is true and avoiding an investigation of his own, which would reveal that, yes, car dealers are indeed overwhelmingly supportive of the GOP, thus it is not surprising that a large number of Chrysler dealers would be as well.

But hey, why report facts when you're getting paid to smear Obama and the "liberal media"?

Most hilariously, though, Sargent concludes by absurdly likening this partisan witch hunt to Watergate: "The Times is already accused of letting the Watergate scoop slide to the Washington Post. One would hope that they will not repeat their mistake."

Fellow NewsBuster Tom Blumer -- who has a long history of botching simple concepts and getting basic facts wrong -- weighed in on the issue in a May 30 post, and the results are about what you'd expect. Blumer explored a tangent of the conspiracy, that minority-owned Chrysler dealers were disproportionately spared from closure. He even quoted a blogger, Sean Parnell at the Center for Competitve Politics, who had calculated that the percentage of minority-owned Chrysler dealers was almost exactly the same before and after the round of closings.

But Blumer decided that because more minority-owned dealers are allegedly located in less-than-optimal urban locations, more minority dealerships should have closed:

Parnell and his "trusty calculator" are missing an obvious point: The "enemies list" may or may not exist, but the issue of its existence is separate from the issue of minority vs. non-minority dealer survival.

There's a much bigger problem with Parnell's argument. As noted in a May 15 Wall Street Journal article by Alex P. Kellogg, when the number of dealer closures was known but not the identities of all dealers axed, minority-owned dealers publicly feared a three or more times greater depletion in their ranks:


My trusty calculator tells me that the feared closure rate was 82% (140 divided by 170; NADAM's dealer count appears to be from early 2008), while the actual closure rate was 25% (38 divided by 154).


All other factors being equal, given NADAM's [sic: he's referring to the National Association of Minority Automobile Dealers, or NAMAD] expressed fears and the general comparative dealer profile it provided the Journal, the minority-owned dealer termination rate should have been higher -- probably much higher than the 25% overall average. In fact, it's clear that NADAM expected that outcome, even if you heavily discount their worry that over 80% of minority-owned Chrysler dealers would be told to go away as overblown hyperbole.

But it would appear that all other factors were far from equal, and that influences other than bottom-line business considerations were prominent.

In other words, according to Blumer, the fact there's no evidence of a conspiracy is evidence of a conspiracy.

But that's pretty emblematic of how the ConWeb has treated this story -- the conspiracy is more important than the truth.

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