[FINALLY!!!]

February 26, 2001 Jackson's income triggers questions

By Steve Miller and Jerry Seper THE WASHINGTON TIMES

CHICAGO — The Rev. Jesse L. Jackson's opulent lifestyle has prompted many of his critics here to ask the obvious question: Where does the 59-year-old activist get the money to pay for three homes, first-class travel and a $3,000 monthly child-support payment to a former mistress? "It's a question mark we've all had for years," said Chris Dudley, former executive director of the Illinois Republican Party. "He's got front-row seats at the [Chicago] Bulls games. He's undoubtedly a wealthy man." "That's a good question," added Don Beachem, vice chairman of the Illinois Minority Community Alliance, a Cook County sheriff's deputy who claims to have his finger on the pulse of Chicago's sizable black community. "The only thing I can tell you is what I hear from other people," said Mr. Beachem. What he hears is that Mr. Jackson's financial support comes from "his organizations, from PUSH, the Rainbow Coalition, from the Citizenship Education Fund. I'd imagine there is some grant money in there, too." The conglomerate of eight nonprofit and public organizations that Mr. Jackson is affiliated with are for the most part financed by the generosity of corporate America and a multitude of loyal followers. The organizations include the 30-year-old People United to Serve Humanity (PUSH), the Citizenship Education Fund (CEF) — both of which are tax-exempt and nonprofit — and the Rainbow/PUSH Coalition, formed in 1996 as a for-profit corporation. The complaints among many of his critics in Chicago are loud and clear: Mr. Jackson, under the guise of selflessly promoting social change, has lined his pockets. He has an estimated annual income of about $300,000. Mr. Jackson's home, a large two-story white stucco located a half-mile from the Rainbow/PUSH Coalition headquarters on this city's south side, sits in the upscale Jackson Park Highlands. It's an old section of town that, despite the high levels of crime which forces homeowners to put up barred windows, is also given to beautifully baroque houses that are valued on tax rolls between $100,000 and $125,000. At various times, Mr. Jackson also owned two other homes, one in Washington purchased for $100,000 in 1985 and another in Greenville, S.C., purchased in 1984 for $40,000. Steve Taylor, publisher of a regional black newspaper, the Kankakee City News, recently wrote an editorial accusing Mr. Jackson of playing the race card to make himself one of the wealthiest black ministers in the nation. Mr. Jackson denies such accusations and said he has simply lobbied major corporations to steer business and capital toward minority entrepreneurs. "Rather than race, we talk business," Mr. Jackson said. "If what I have to offer holds no value to [a corporation], then we don't talk." The companies that do talk and give out money, some of them Fortune 500 corporations, have become generous contributors to the nonprofit organizations led by Mr. Jackson. The CEF, for example, has received nearly $4 million in pledges from SBC-Ameritech, AT&T, Viacom, GTE and Bell Atlantic in recent years. Mr. Jackson, though, is uncharacteristically humble about his standing in the national black community and his role in attracting corporate largesse. "This is my job," he said during a 90-minute interview with The Washington Times. He dresses like any other businessman, wearing a conventional suit with his tie often askew as he tackles his daily duties of redressing perceived racial and economic injustices. Mr. Jackson noted with his customary wry smile that he could have ridden his profile as a prominent civil rights activist to great wealth. He pointed out that when, in the early 1970s, he negotiated black ownership of several Chicago-area car dealerships and numerous McDonald's franchises, he could have cashed in personally. "I could make more, but I'm not interested in that," he said. "One or more of those franchises could have been mine. I have no piece of them." Mr. Jackson points to his current passion of attracting capital for black businesses as an example of what he does for a living. Self-dubbed as "The Wall Street Project," it is a movement to persuade corporate America to invest in minority businesses. It has seen some significant results, including a commitment by AT&T to have $1 billion in bonds brokered through Blaylock & Partners LP, a black-owned firm in New York. The civil rights leader, however, is never far from the pulpit. He greets his local followers at a traditional Saturday morning service in the ornate sanctuary of the Rainbow/PUSH headquarters. The 300 or more people who attend — about 10 percent of them white — listen to Mr. Jackson's every word as he speaks to them in hushed tones. Backed by a six-piece band and a choir, Mr. Jackson presides over a service that is like any other in America, save for one thing: At the back of the massive hall is a 10-by-10 banner of Mr. Jackson, a testament to his powerful charisma and popularity among his followers. The service is broadcast on cable access television and local radio. And at the end of the service, as at any religious service, the contribution plate is passed around.

The activist's finances

In his earlier days as a civil rights activist, Mr. Jackson was saddled with questions about one of his organization's accounting practices and its lack of accountability in the use of federal grant money. Government auditors in 1979 challenged the way Mr. Jackson's operation PUSH spent $1.7 million in federal grants. The program received $6.5 million from various federal agencies over a short period of time at the end of the Carter administration. Auditors reviewing grants said that $737,000 had been improperly spent and questioned the spending practices involving another $1 million. The organization negotiated a settlement with the government to repay more than a half-million dollars in the early 1980s, plunging itself into an operating deficit that reached nearly $340,000 by 1986. At the same time, a government-funded study conducted by the American Institute for Research declared that the program had accomplished little. More criticism also came in the late 1970s from Department of Education auditors, who contended that PUSH had failed to account for how it spent $1.2 million of $4.9 million in federal grants. The controversy associated with the grant money days are over, assured Mr. Jackson. "They gave us federal grants when we didn't even want them," he said. Mr. Jackson explained that an appearance on the television show "60 Minutes" in 1979 prompted some government officials to besiege the fledgling organization with ways to solicit public funding. Although the fiscal bumbling may be in the past, the perception remains that Mr. Jackson lives on public dollars. With characteristic urgency, Mr. Jackson refutes that misconception saying, "We don't have any taxpayer money. We don't want any taxpayer money. I learned my lesson. It was distracting. We didn't ask for it. We were going out and talking to kids at that point, and you don't need government money to do that." True enough, none of his nonprofit organizations have any grant money and have not had any for years. Yet this has not stopped Mr. Jackson's benefactors from taking advantage of the tax-exempt status that some of his organizations enjoy. His Rainbow/PUSH and Push for Excellence had incomes of more than $4 million in 1998, and the affiliate tax-exempt CEF declared revenue of $9 million in 1999. Mr. Jackson draws a $120,000 annual salary from PUSH, a nonprofit group formed in 1971 and incorporated in 1977. Spokesman John Scanlon, a New York-based public relations agent, said Mr. Jackson also earns close to $150,000 annually in speaking fees as well as an undisclosed sum of income from CNN, where he has hosted a public affairs show, "Both Sides With Jesse Jackson," since 1992. The show, however, was taken off the air last month. In addition to the income from CNN, Mr. Jackson's speaking fee varies, Mr. Scanlon said, according to the ability of the audience to pay. It ranges from giving speeches free of charge to a substantial cost, said Mr. Scanlon, who declined to name any other revenue-producing sources for his client. The speaking fees are arranged through a separate, public entity known as Jacqueline Inc., which is controlled by Mr. Jackson's wife. Moreover, Mr. Jackson said he accepts the gratuity of others when he travels as an activist. "I get plane tickets, hotel rooms when the beneficiaries can afford such costs," he said. "But when we went to the Mississippi Delta, for example, we sure couldn't get a comp there, so we pay our own way." Mr. Jackson's income has increased since his records became public in 1984 when he announced his candidacy for the presidency —the first of two presidential bids. That year, he released his 1983 tax return showing an annual income of $115,000. In 1987, according to a financial disclosure statement he filed with the Federal Election Commission (FEC), his annual income exceeded $250,000. This included a salary of $192,090 from Personalities International Inc., a now-defunct Chicago speaker's bureau formed in 1984 by Mr. Jackson's family; $18,750 in payments from his National Rainbow Coalition; and more than $33,000 in honorariums for speeches at colleges, conventions and churches.

Jackson: 'I can take the hits'

Yet as Mr. Jackson's wealth and profile has grown over the years, so has the number of his detractors. In the beginning, his opposition came from some unlikely corners. In 1982, the St. Louis Sentinel, a black newspaper, reported that Mr. Jackson had asked a local coalition of businessmen for $500 each to lead a boycott of Anheuser-Busch Co., a business with deep roots in the community and a stellar record of minority employment. In an editorial headlined "Minister or Charlatan?" the paper accused him of running a game to extract monetary contributions from local businesses. Mr. Jackson, unaccustomed to such treatment, filed a $3 million libel suit against the paper. "Anheuser-Busch was a good corporate citizen," said Michael Williams, co-publisher of the Sentinel. "We questioned his motives. We had black business owners who were really offended that Mr. Jackson would want money to go after this company." But when a judge asked Mr. Jackson to produce his financial records during the trial, the civil rights leader declined. The case was dismissed. Since then, critics have consistently questioned — including the recent revelation of an illegitimate daughter and lavish child-support payments — the nature and source of Mr. Jackson's finances. The mishandled federal grants, for example, dogged Mr. Jackson for years. His presidential runs in 1984 and 1988 also cast him as a man with a reputation for being a spendthrift. An FEC audit of the 1984 campaign found that the Jackson committee underreported its receipts by $826,000 and its expenditures by more than $1 million. The 1988 campaign committee found itself initially ineligible for federal matching funds because of bounced checks. Mr. Jackson's inability to curtail his spending habits has left some critics wondering whether the activist's crusade for social justice and economic parity comes with overhead costs that are too high. "Any time Jesse shows up now, it's going to cost you," said Hurley Green Sr., publisher of a conservative black newspaper in Chicago. Mr. Green said he used to ghostwrite a column for Mr. Jackson, which ran in another local black newspaper, the Chicago Defender. "I did it until I found out that Jesse was getting paid for it," Mr. Green said in an interview last week. "I thought he was doing it for the community, and I never saw a dime." In his interview with The Washington Times last week, Mr. Jackson played down these instances of questionable financial dealings with a story focusing on his 1984 trip to Syria which helped to secure the release of captured Navy Lt. Robert Goodman. When his plane returned to the United States and he was preparing to face a throng of waiting reporters, Mr. Jackson said he was "wondering what kind of questions they would ask, things about what this might mean to world peace or how the release all came about." "Instead, the first thing I heard," he said, assuming a television reporter's self-important stance with an extended arm grasping an imaginary microphone, "was 'who paid for your hotel?' " Mr. Jackson is a survivor. The attacks from his critics, last month's revelation of an illegitimate child and several reports of mistresses are met with apologies and remorse. But, he said: "I can take the hits because God has blessed me."

-- Anonymous, February 26, 2001