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New Jersey: Senior Senator Sen. Jon Corzine (D) Last Updated July 10, 2003
Jon Corzine, former chairman of Goldman Sachs, was elected senator from New Jersey in 2000 after waging the most expensive Senate campaign in American history. Corzine (pronounced cor-ZYNE) grew up on a family farm in Downstate Illinois, far from New Jersey; he went to college at the University of Illinois, business school at the University of Chicago and served six years in the Marine Corps Reserve. In 1975 he joined Goldman Sachs in New York; his entry-level position included fetching coffee for his superiors. Corzine was a successful bond trader and a protg of Robert Rubin, who became Treasury Secretary in the Clinton administration. In 1980 Corzine was made a general partner and in 1994 he became co-chairman and CEO. In May 1999 Goldman Sachs went public, and the $3.66 billion initial offering netted Corzine more than $300 million; he retired in 1999 after a management shakeup. Aside from contributing to Democratic (and some Republican) candidates, he was not involved in politics, indeed did not vote in primary elections from 1988 to 1998 or in the 1991, 1995 and 1998 general elections; in 1997 he co-chaired a presidential commission on increasing investment in technology, infrastructure and schools. In early 1999, a Senate race was probably the farthest thing from Corzine's mind. Then, in February 1999, Senator Frank Lautenberg announced he would not run again in 2000 (Lautenberg, of course, returned to win election to Senator Bob Torricelli's seat in 2002, and is now Corzine's junior colleague). Plunging immediately into the race was former Governor Jim Florio, still unpopular for the $2.8 billion tax increase he secured in 1990. In April Governor Christine Todd Whitman, presumably the strongest possible Republican candidate, announced she was running. Many Democratic insiders, including Torricelli, feared that Whitman would win the seat, and scurried around to find other contenders. Then Torricelli and North Jersey Democratic insiders found Corzine, with $300 million and without a job. He started running, going around the state to meet leaders of the county Democratic organizations, who are considered vital in the primary, and, it was revealed much later, contributing generously to them and to community organizations. He quickly cornered organization support outside Florio's home area in South Jersey and, like most local Democratic insiders, endorsed Al Gore over New Jersey's Bill Bradley. Meanwhile, Corzine's great wealth and his willingness to spend it cleared the field; Whitman withdrew in September. Corzine's money talked even while most New Jersey voters had never heard of him. Still Florio, backed by Camden County Democratic leader George Norcross and some labor unions, campaigned aggressively. He attacked Corzine's inexperience and spotty voting record. He said Corzine represented "Wall Street values" and was attempting a "hostile takeover of the Democratic party." He charged that under Corzine, Goldman Sachs floated a bond issue for a company that invests in Sudan, with its terrible human rights record. Even so, New Jersey Democratic leaders dreaded that Florio would lose to even the little-known candidates running for the Republican nomination. In March, three months before the primary, Corzine went up with TV ads in the New York and Philadelphia markets. He set forth his liberal stands on issues--for a universal health care system, for government payment of tuition to college or vocational or technical school for students with at least a B average, for gun control, for abortion rights. Corzine's investment--he spent $35 million up to the June primary--paid off. Florio won in South Jersey by a 67%-33% margin, but South Jersey cast only 23% of the votes. In North Jersey Corzine led 65%-35%, for an overall 58%-42% victory. After the primary, Corzine cut back on spending--for a while. The Republican primary, with a pathetically low turnout, was won by 7th District Congressman Bob Franks--amazingly, a member of the same church as Corzine. With North Jersey support, Franks narrowly (36%-34%) edged state Senator William Gormley, who had a big financial advantage thanks to support from Atlantic City casino interests. Corzine's ads talked about his big-government positions in appealing terms, but he almost made a political neophyte's mistakes that got him bad publicity. In early September he told the Sierra Club he had voted for an open space referendum in 1998; but in 1998 he had not voted at all. Still stuck below 50% in the polls, he started running negative ads against Franks two weeks later. He had been refusing to make his income tax returns public, on the ground they violated a confidentiality agreement with Goldman Sachs. Then in mid-September he released records showing that in 1996-99 he made $145 million, paid $43 million in taxes and gave $25 million to charity. But when reporters started investigating which charities, they found that he had stepped up giving to New Jersey groups in 1999, and that he gave hundreds of thousands to groups whose leaders and sponsors later endorsed him. He gave $30,000 to a dinner honoring Lautenberg, who later endorsed him; he gave $50,000 to Operation Rainbow/PUSH, and Jesse Jackson endorsed him the night before the primary; he gave $25,000 to St. Matthew's A.M.E. Church in Orange and was endorsed by the Black Ministers Alliance of New Jersey. When he was asked whether he had contributed to any of the churches, he said no; it turned out his family foundation made the contribution. Franks, like Florio, argued that Corzine was trying to buy a Senate seat and attacked him for failing to disclose the tax returns and for backing "universal" government programs that were unrealistic and too costly. When Corzine's numbers stalled because of his mistakes, Franks held onto his money and spent $2.5 million in the last two and a half weeks, when he also benefited from endorsements by the New York Times and the Philadelphia Inquirer. Corzine spent $7.4 million on turnout efforts including, embarrassingly, busing in residents of Philadelphia homeless shelters and halfway houses to work on his campaign. In the end Corzine spent more than $63 million, the all-time record. He won 50%-47%, with big margins in central cities--the turnout effort delivered. But that trailed the generic vote in increasingly Democratic New Jersey. In the Senate Corzine has had a very liberal voting record; he declined to join the Democratic Leadership Council and has consistently argued that Democrats, having earned credibility on macroeconomic issues in the 1990s, should take forthright liberal stands. He continued to support universal health care, called for a national moratorium on the death penalty and a national ban of racial profiling; he voted against the Iraq war resolution in October 2002. Only on the 2002 farm bill did he strike another note: He was one of two Democrats voting against because, he said, it was too expensive. He voted against the 2001 Bush tax cuts and in August 2002 said Congress should "rescind or freeze" them; in January 2003 he led Democrats in opposing that year's Bush tax cut, arguing that by siphoning off dividends it might reduce investment and called for a $300 rebate instead. On Social Security he was one of the Democrats' leading critics of individual investment accounts. But he got the most attention on the issue of corporate accountability raised by the collapse of Enron in December 2001. Majority Leader Tom Daschle made a point of having Corzine at his side when speaking on the issue, and it is obviously a subject on which he has special expertise. Some criticized him because Enron had been a big Goldman Sachs client and for pushing and defending monthly income preferred shares, a device promoted by Goldman Sachs by which companies sold 50-year preferred stock through an entity created on a Caribbean island, which was considered debt for tax purposes and equity for corporate purposes; but as Corzine pointed out the device was announced publicly and found to be legal by authorities. Corzine, who put his money in a blind trust and has said he would not vote on legislation affecting his portfolio, said in January 2002 that SEC Chairman Harvey Pitt should recuse himself from the SEC's review of auditing standards because he used to work for the Big Five accounting firms. He was not, however, one of the senators who called on Pitt to resign. "Contrary to popular opinion," Corzine said in February 2002. "I think he's been pretty forceful." Corzine argued that Enron and other scandals indicated the need for more regulation. In early 2002 he called for regulating hedge funds, stronger enforcement powers for the SEC and tougher limits on special purpose entities. With Barbara Boxer, he sponsored a law allowing no more than 20% of a worker's 401(k) to be invested in a single stock. On the Banking Committee, he worked with Chairman Paul Sarbanes on his corporate accountability bill, and bemoaned that it seemed stalled in June 2002. But then the WorldCom scandal came along, and the bill, slightly amended, became the Sarbanes-Oxley Act. He has argued that financial services regulation should be concentrated in the Federal Reserve and the SEC, not the Comptroller of the Currency or the Commodities Futures Trading Commission, and said that the current system provides no consolidated view of regulation of derivatives markets. September 11 hit New Jersey especially hard--Corzine noted that 10 people from Summit, where he owns a home, died at the World Trade Center--and Corzine's major initiative in response was a chemical security bill that would require businesses that house chemicals to conduct vulnerability assessments and consider safer security technology. He sought to attach it to the homeland security bill in fall 2002, but others argued that it would put undue burdens on stores selling fertilizer and pesticide, and his provision failed. He was also a cosponsor of the Terrorism Risk Insurance Act, which became law in November 2002. Corzine is a stronger partisan than many senators who have spent all their adult lives in politics, and from 1999 has thrown himself, and his money, into building the Democratic party in New Jersey and in the nation as a whole. He and his family gave more than $1 million to various Democratic entities in 2000, and he gave $1.6 million to New Jersey Democrats in the 2001 state elections--money that helped them gain a majority in the Assembly and a 20-20 split in the state Senate. He gave $837,000 to the First Jersey PAC run by George Norcross, his adversary in the 2000 primary. In the 2002 cycle he gave more than $1 million to Democrats across the country and $250,000 to the DSCC, including $100,000 on November 5, the last day on which such soft money contributions were legal. Throughout the 2002 cycle he let it be known that he would like to become DSCC chairman after the election. He showed his skills at handling difficult political situations in the imbroglio over whether Bob Torricelli should drop out of the 2002 Senate race. He had backed Torricelli all along, but helped to negotiate Torricelli's departure and the selection of Frank Lautenberg to replace him; he was in the room with Jim McGreevey and other leading New Jersey Democrats when the negotiations were going on and was the one person there most concerned with the effect on the national Democratic party. In December 2002 Tom Daschle chose Corzine to head the DSCC. Corzine, as a candidate recruited just four years before, knows that candidate recruitment is important; he is expected to seek at least some self-financing millionaires like himself to run in races that might otherwise be difficult or hopeless. But he has said that the campaign finance law provision setting higher contribution limits for opponents of self-financers might reduce their advantage. His net worth of $300 million will presumably be reduced by his 2002 divorce, but the personal incomes he reported for 2000 and 2001--$71 million and $46 million--suggest that he will have enough to continue his present rate of giving for many cycles to come.
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