Garamonday Morning Update:The Commisioner Speaks and a Bakersfield Broadcaster Succumbs to "Blackmail"

The Commissioner Strikes Back and Speaks Out:

In the previous installment of Decs&Excs' continuing coverage of Insurance Commissioner John Garamendi's allegations of "political extortion" against the insurance industry, I pointed to a Sacramento Bee editorial that opined: "That wasn't a crime. It's called politics, free speech, democracy in the raw."

Yesterday, the Bee provided the Commissioner the opportunity to respond.  He takes rather a different view of the industry's activities.  Because this is the clearest statement yet of the logic by which the exercise of political speech might be viewed as unlawful, it is worth quoting at length:

The auto insurance industry opposes these new rules and has the right to express its opinion.  But the laws of California and the United States prohibit any offer of a quid pro quo deal to influence an official's decision, and that is exactly what the industry offered to me: Delay my plan to enact new auto pricing rules until the next commissioner arrives, or else face a $2 million negative advertising campaign.  This was not, as the industry has suggested, 'a friendly heads up.'  It was an 'either/or' demand and clearly a quid pro quo message.

The negative ads were timed to air in the few short weeks before the June primary election in which I am running for lieutenant governor and during my finalization of the regulations.  The threat was an obvious and desperate effort to stop these new rules by any means necessary.

Even more obviously, this extortion attempt crossed the bounds of acceptable political discourse.

As we have seen in recent months, there is a crisis in American governance.  Political scandals have plagued our state and nation, and elected officials too often have betrayed the trust of voters in exchange for favors.  I won't be a part of that corruption.  And if the insurance industry's extortion attempt is, as you contend, an example of politics as usual, then we have a serious problem in our democracy.  And you should be just as outraged as I am.

Decs&Excs Comments:

• The Commissioner concedes that the insurance industry "has the right to express its opinion," so the supposed crime here has to relate to the industry's decision to tell the Commissioner in advance that it was going to do so.  It is hard to imagine that Garamendi would be any happier with the industry if it had simply begun running the ads without warning.

• The logic of the Commissioner's argument conflates two distinct notions: "extortion" and "quid pro quo."  Both concepts involve trying to influence action by describing the consequences of not taking that action.  In true extortion, the argument is "a bad and unlawful thing will be done to you if you don't do as you're told."  In a true quid pro quo the argument is "we will do something nice (and not necessarily lawful) for you if you do as we're asking."  Extortion involves threats; quid pro quo is essentially a form of bribery, or what the Commissioner refers to as "betray[ing] the trust of voters in exchange for favors."  Does the situation here fit either definition?  Not really.

• There is no true "extortion," because the consequence with which the Commissioner was "threatened" was, as he concedes, conduct that is entirely lawful.

• The supposed "quid pro quo" offered by the insurers was that they would not run the ads if the Commissioner simply did the thing that the ads were intended to persuade him to do.  That is, if the Commissioner made the ads unnecessary, the industry promised it would not waste its money on unnecessary ads.

• The promise or threat made by the insurance industry in Garamendi's version was, ultimately, nothing more offensive than: "If you don't do as we're suggesting, we'll go to the public with our arguments and ask the public to persuade you."

The Ads Begin, the Press Reacts:

Out in the world, the ads themselves have begun to be broadcast: versions hit the airwaves in San Diego and Kern Counties last Tuesday, and in 19 additional counties the following day.

An exemplar version of the ad (targeted particularly at Santa Barbara and San Luis Obispo Counties) can be viewed in Windows Media format on the main page at the official site of the insurer-sponsored Californians to Stop Unfair Rate Increases, or you can click here at Decs&Excs to view either the large or small versions of the ad.

Say what you will about the merits of the insurance industry's position, it is more than somewhat of a stretch to call this a "negative" ad -- unless "negative" is defined as "not in agreement with Commissioner Garamendi."  It certainly cannot be characterized as an "attack" ad, which is the way in which it was characterized in the Commissioner's original, Department-endorsed press release.  (We Californians know "attack ads" when we see them, and we are being treated just now to a variety of examples of the form in the sniping between the Democratic contenders for the nomination for Governor.) 

Worse for the Commissioner than being caught in a bit of overstatement is the fact that the ads might actually be working in swaying public opinion.  At least one television station -- the NBC affiliate in Bakersfield -- has produced a story that roundly endorses the insurers' arguments:

BAKERSFIELD - Car insurance rates will likely increase in Kern County if the State's Insurance Commissioner John Garamendi gets his way.

A couple of months ago, the idea was first proposed to increase rates in the valley while rates in the big cities would be lowered.

Now there’s a TV ad campaign opposing the rate hike idea in California’s Central Valley and it’s picking up momentum.

The video version of that report -- which incorporates most of the Kern County version of the insurers' ad -- is accessible at the link above.

Coming Soon:  Decs&Excs reviews the candidates to replace John Garamendi as Insurance Commissioner . . . and shakes its metaphorical head in dismay.

    ~~~

UPDATE [1222 PDT]: 

Now, these are the ads that Commissioner Garamendi should actually be concerned about:

• Bill Bradley's New West Notes reports on the first advertisements by Garamendi's actual opponents in the race for Lieutenant Governor.