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Kos – Armstrong Blogola Scandal

Dan Riehl has done some digging and found that myDD’s Jerome Armstrong received rather significant payments from his work as a political consultant on Jon Corzine’s successful campaign for NJ governor. While Tim Worstall has a point when he observes that, “with the amount of cash that swills through American politics, they actually look like very small sums,” they’re pretty hefty for amateur consulting services. (A recent MSNBC story has Armstrong describing his role in the Mark Warner campaign as handling “anything that deals with the Internet or technology, especially with the strategic decisions that are made early on in terms of the vendor relationships, the people we bring on.”)

Peeling back the onion a bit, we see that there seems to be a rather symbiotic relationship between Armstrong’s consulting business and the blogging activities of his Crashing the Gates co-author Markos Moulitas Zuniga. Clients of Armstrong’s consulting business, including rather netroots unfriendly candidates like Mark Warner, strangely seem to capture Kos’ fancy and get ringing endorsements.

Slate’s Chris Suellentrop noted the Kos-Armstrong connection and their propensity for blogging about clients well over a year ago, but thought Armstrong deserved only a “slap on the wrist” for shilling for Dean on his blog without disclosing that Dean’s campaign was paying him as a “consultant.” Kos, on the other hand, earned his wrath for having a large string of undisclosed “clients” at a time when he was urging his minions to pony up large sums of cash for selected Kos endorsed candidates. This Sunday, Suellentrop had (somewhat ironically) a pay-per-view piece in the NYT which notes that the practice has gotten more sophisticated. As quoted by TNR’s Jason Zengerle:

[S]ome people . . . compare the blog boomlet they helped create for Dean to the work of online bulletin-board posters who touted dodgy Internet stocks during the boom market without disclosing that they were being paid for their words.

Which, interestingly, is precisely what the Securities and Exchange Commission, in court documents filed last August, alleges that Jerome Armstrong did in 2000. (The original S.E.C. complaint is here.) In a subsequent filing, the S.E.C. alleges that “there is sufficient evidence to infer that the defendants secretly agreed to pay Armstrong for his touting efforts” on the financial Web site Raging Bull.

Without admitting or denying anything, Armstrong has agreed to a permanent injunction that forbids him from touting stocks in the future. The S.E.C. remains in litigation with him over the subject of potential monetary penalties.

It appears that he has found another way to do essentially the same thing. Red State’s Crank:

It’s hard to say that Armstrong’s conduct in the BluePoint case can be separated from his employment by the Warner campaign – if anything, what he did in 2000 bea rs a striking resemblance to what numerous people have noted in the netroots with candidates: money goes to Armstrong, and hype emerges around his favored candidates, and – if the Howard Dean campaign is any indication – what’s left at the end is a bunch of promoters and consultants who made a bunch of money and an audience of true believers who got left with nothing. In other words, it appears that Warner may be using Armstrong for essentially the same function that ran Armstrong afoul of the law in the first place.

Ace of Spades:

Let’s say, hypothetically, you wanted to work both inside and “outside” the political system. One person couldn’t do both; working for someone, taking money from a politician, makes you obviously biased.

But I wonder… I wonder… would there be some way that, I don’t know, two people, say, could both be paid by politicians and also get lots of advertising income for a supposedly independent media outlet?

I know, it’s crazy. There’s no possible way something like that could work.

Donkey Cons has quite a bit of speculation on this one, too, working in the rather antequated phrase “argle-bargle” several times.

Tom Maguire links more documents in the BluePoint matter.

As a side note, Mickey Kaus asks, not unreasonably,

If the NYT’s Chris Suellentrop had a scooplet about Kos crony/Mark Warner payee Jerome Armstrong and the S.E.C. but nobody read it–because it a) wasn’t in the NYT print edition and b) on the Web it was stuck behind the TimesSelect subscription wall–would it make a sound?

I must admit, it’s most odd that what seems a rather major story like this was not deemed worthy of the NYT print edition or even the public website. After all, the NYT and other mainstream outlets covered the YearlyKos convention, the launch of Crashing the Gates, and various other “netroots” activity with zeal. Especially coming at the tail end of YearlyKos, one would think this newsworthy.

As to the Kos-Armstrong payola charge, we’ll need a lot more evidence before getting too carried away. On the one hand, I disagree with Suellentrop’s essential dismissal of their taking money from the Dean campaign while touting Dean on their blogs and not disclosing the relationship on the ground that bloggers aren’t “journalists.” Even though most of us do mostly opinion journalism on our sites, readers have a reasonable expectation that the opinions we tout are our own. On the other hand, since the Dean mini-scandal broke, Armstrong has essentially retired from blogging and become a full-time consultant, selling his expertise in marketing to the netroots (a term he coined) to candidates. Whether he really believes in said candidates is really irrelevant in the consulting game; pay-per-play is the above board nature of that business.

The real question is the nature of the relationship between Armstrong’s clients and the DailyKos blog. That Corzine was given a DailyKos diary is hardly evidence of anything sinister; there are thousands of diarists, few of whom are multi-millionaires. The seemingly odd touting by Kos at every opportunity of Mark Warner is really the only red flag but there could be a non-financial explanation. Regardless, the Kos angle is the one that bears watching.

UPDATE: Don Surber sees more guilt by association: “DNC Sugar Daddy George Soros was convicted of insider trading in 2005.” Given that Soros was a major funder of MoveOn.org, Dean, and the netroots ad boom, it is an interesting coincidence.

Glenn Reynolds is not particularly impressed with the brouhaha.

Is this a big deal? I’m not sure it ought to be. Blogs are a low-trust environment, and readers should be judging bloggers by what they say and how well they back it up, not by their credentials. [….] Still, for my bottom-line take, a suggestion that political consultants have a history of talking things up for personal gain seems less-than-earthshaking to me. Am I wrong here?

I think so, yes. Whether there’s any actual corruption here, as Bill Ardolino wonders, is still unknown. But while consultants taking money from candidates is not news, flacking said candidates on one’s blog without disclosing said pay is incredibly dishonest.

Reynolds has an interesting exposition of the “low-trust environment” argument here. The key is that, “You have a reputation, and it matters, but the reputation is for playing it straight with the facts you present, not necessarily the conclusions you reach.” While that’s arguably true on a per post basis–and for most of the higher trafficked blogs, most traffic comes to specific posts from links elsewhere, including search engines–it’s not true for a communitarian site like DailyKos. The Kosacks aren’t just coming for analysis, they’re there for marching orders. They’re not giving tons of money to Kos-selected candidates because of careful weighing of facts and clicking through of hyperlinks but rather because they trust Kos’ endorsements.

On the left, TAP’s Garance Franke-Ruta thinks this a “little micro-scandal” while Pandagon’s Jedmunds “can’t even comprehend how Jerome Armstrong’s reputation could survive this.”

Correction: The original version of the story incorrectly referenced Matt Stoler, the other prominent myDD blogger, rather than Jerome Armstrong in the opening sentence. Thanks to the email tipster who pointed out my error.

UPDATE: Jim Geraghty offers up “A hopefully-useful Kos-Armstrong timeline.” It is, in fact, useful. Still, aside from the Dean case, where Kos definitely took money, and the Warner case, where we have no proof that Kos is getting anything for his shilling, the “Kos-ola” scandal seems misnamed. If there’s undisclosed pay-for-post going on, we have a scandal; otherwise, not so much. The Armstrong SEC thing combined with his blogging for Dean while clandestinely being on his payroll provide two strikes for Armstrong; so far, it’s only one strike for Kos.

UPDATE: Mickey Kaus responds to the last line of the previous update: What about Ohio? The link describes Kos’ sudden reverse on Paul Hackett–I mean, diametrically opposed positions [here and here] in the space of 8 hours–once Armstrong took on his opponent’s campaign. Strike two.

UPDATE: Kos responds:

I haven’t consulted since 2004. I don’t plan on consulting in the future. I don’t want to consult. Why would I consult when I have the sweetest gig in the world? I mean, I get paid to blog and write! Why would I mess with that formula?

My only sources of revenue are this site (advertising and subscriptions), some freelance writings in places like the American Prospect, and CTG (eventually. It takes publishers ages to send out royalty checks). At some point in the future, SportsBlogs will be a source of revenue, but it’s nowhere near that point yet. No politician, campaign, issue group, nor any other organization has directly or indirectly paid me for anything.

That’s pretty unequivocal. So far, though, nothing explaining the dovetailing of his endorsements and Armstrong’s clients, notably the 180 on Paul Hackett vice Sherrod Brown.

CORRECTION:
Above, I stated that Jerome Armstrong was “blogging for Dean while clandestinely being on his payroll.” While that was indeed my recollection, it was in error. He in fact shut down myDD–at the time, more popular than DailyKos–during the entire period. My apologies.

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About James Joyner
James Joyner is the publisher of Outside the Beltway, an associate professor of security studies at the Marine Corps Command and Staff College, and a nonresident senior fellow at the Atlantic Council. He's a former Army officer and Desert Storm vet. He earned a PhD in political science from The University of Alabama. Views expressed here are his own. Follow James on Twitter.

Comments

  1. Iowa Voice says:

    Liberal Bloggers On The Take?…

    RedState has an excellent post up about MyDD founder, Jerome Armstrong:

    Deep behind the Times Select firewall this weekend was an article by Chris Suellentrop that calls into question both the judgment of Mark Warner and the motivations behind some …

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  2. The Kos Corzine Connection…

    Here’s something I found which appears interesting enough. Supposedly, Kos compatriot Jerome Armstrong is Political Technologies LLC. During his run for NJ Governor, Corzine opened a diary at DailyKos on April 14, 2005. According to this disclosure do…

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  3. madmatt says:

    I notice you don’t mention the Thune and Blunt campaigns and their use of paid for blogs? As long as they admit they take the money which you yourself said they did, unless they are working 2 guys against each other in the same race there is no problem. And seeing as the bushies are notorious for paying for propaganda it seems to be a case of pot and kettle.

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  4. capt joe says:

    madmatt, tu quoque?

    The key issue with this is to take money, shill and pretend you aren’t bing paid to do it. And that is bad no matter who does it.

    If he had said, so and so paid me money to say x, then there would be no problem. Understand. But then the effect would be much less.

    And I would say the same no matter who did it. Remember the stink over the columnists who were paid by some on the right. Well, most right side bloggers cried foul on this. AS they do on what Armstrong did. If the left side of the blogosphere starts making excuses then what are we to believe. Sort of hypocritical don’t you think?

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  5. James Joyner says:

    madmatt: Nor is that story in the news today. Nor were those blogs by far the most prominent political blogs in the blogosphere.

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  6. […] Opinion Jun 20 at 9:11 am by Aaron -I promise not to make my entries here revolve around politics, but when the shoe fits, I say wear it! The story is a’brewin surrounding Markos Zuniga from Daily Kos and compadre Jerome Armstrong from myDD, in which Armstrong was hired as a “consultant” to Jim Corzine gubernatorial campaign in New Jersey. As it turns out, there is a virtual dovetail between Kos’ writing and Armstrongs, one that would appear on the surface to be, as Outside the Beltway’s James Joyner puts it, a” symbiotic relationship”. Peeling back the onion a bit, we see that there seems to be a rather symbiotic relationship between Armstrong’s consulting business and the blogging activities of his Crashing the Gates co-author Markos Moulitas Zuniga. Clients of Armstrong’s consulting business, including rather netroots unfriendly candidates like Mark Warner, strangely seem to capture Kos’ fancy and get ringing endorsements. […]

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  7. What about Kos’ comment when asked why he was supporting Warner “He hired Armstrong”??

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  8. […] Update: As usual, James Joyner puts it well: Still, aside from the Dean case, where Kos definitely took money, and the Warner case, where we have no proof that Kos is getting anything for his shilling, the “Kos-ola” scandal seems misnamed. If there’s undisclosed pay-for-post going on, we have a scandal; otherwise, not so much. The Armstrong SEC thing combined with his blogging for Dean while clandestinely being on his payroll provide two strikes for Armstrong; so far, it’s only one strike for Kos. […]

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  9. kOS, Armstrong – paid political hacks?…

    Many bloggers, apparently eager to stop people from “getting engaged in politics,” have been following the money of some of the candidates associated with Markos Moulitsas “Screw Them” Zuniga and founder of MyDD, Jerome Armstrong, and are connecti…

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  10. RW says:

    This begs the obvious question: was kos being paid by competing securities companies located in Iraq when he said “screw them” to the 4 who were murdered and burned?

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  11. […] James Joyner at OTB, has the most coverage. […]

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  12. […] OTB > Kos – Armstrong Blogola Scandal […]

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  13. More Kosola…

    A useful timeline of Kos’ and Armstrong’s dealings with each other and with politicians paying them. Outside the Beltway on this profitable “rather symbiotic” relationship…….

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  14. Joe says:

    You say Mark Warner is not “netroots friendly” — what is your basis for this. Warner is very friendly with the netroots. You obviously are shilling the line that the Democratic blogosphere is on the “far left fringes” or whatever. It is not. Instapundit, Powerline, etc. are on the fringes — pro-torture, anti-troops, anti-troops’ families speaking out (see Hindrocket’s latest insult today). The Democratic blogosphere is well in the mainstream of public opinion — you know the vast majority being against he war in Iraq today — and even when the war started, 40 percent were against it. Keep shilling for the right wing.

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  15. James Joyner says:

    Joe: I don’t disagree that Kos, at least, is purely pragmatic. Much of the netroots, though, are well left of the Democratic Party, much less the American mainstream. While scandals and dissatisfaction with Iraq may change things in November, it is, after all, Republicans who have won the last several election cycles.

    As to Warner, this recent Kos diary post from BooMan23 might help explain it. Long quote to avoid charges of selective quotation:

    But there can be no avoiding a controversy about the close relationship that is developing between Warner and Daily Kos. Warner was not only granted the keynote speech; prior to the speech he was allowed to pass out free Yearly Kos t-shirts with his face (not Markos’s or Wesley Clark’s, or FDR’s, or Russ Feingold’s, or Hillary Clinton’s, or Armando’s) superimposed on the front. And on the back, it says ‘Forward Together’ and ‘Authorized and Paid for by Forward Together PAC.’ That is Mark Warner’s presidential political action committee. Then we were all subjected to a Kennedyesque five-minute canned campaign infomercial. Then Warner gave a well presented and well received speech, emphasizing a Dukakis-like technocratic competency that was striking (if one hadn’t been expecting it) for its lack of ideology.

    All of this came on the heels of Warner’s huge blowout part last night at the Stratosphere (an event that was in no way affiliated with Yearly Kos). The party was lavish, providing cocktails, a sushi bar, and carved meats and cheese trays.

    Even before the Keynote address I was hearing a lot of grumbling about Warner’s decision to spend so much money buttering up the Kossack crowd. After the t-shirt and informercial stunts, I heard a lot more grumbling.

    For some, the problem is a simple matter of how Warner is choosing to spend his money. But for others, the problem is that Mark Warner is a centrist candidate that has strong connections to the Democratic Leadership Council. And it is jarring to see Markos go from declaring war on the DLC to coming within inches of endorsing a DLC candidate for President over two years out from the election.

    Let’s be clear about one thing. Markos did not endorse Warner. He was explicit about that. But he has given Warner a major platform to try to win over the Kossack community and to raise his profile from a little known Governor, to someone that might give (another DLC candidate) Hillary Clinton a run for her money.

    And the question then becomes, “is this what Daily Kos wants? Has Daily Kos come to a point where they are going to cozy up to the Democratic Leadership Council?’ Why are we so opposed to Hillary Clinton and Joe Lieberman, if not because they supported the war and do not advocate leaving Iraq? How is Mark Warner any different in this regard?”

    I’ve sat down with Governor Warner and discussed Iraq with him. I like Governor Warner and I know that he is torn over what to do in Iraq. I appreciate, really appreciate, his attitude towards the netroots, toward the progressive community, and toward me personally. I think he is a good man, and I think he should be taken seriously as a candidate. Not all DLC members are the same. There is a big difference between Lieberman, Bayh, and Hillary on the one hand and Warner, Richardson, and Vilsack on the other. Gore is a DLC candidate cut from another mold.

    The way the Presidential race is shaping up, it looks like John Edwards and Russ Feingold are going to be the only non-DLC candidates with a prayer of winning. So, looking at Mark Warner makes some sense. At least he is listening, being respectful, and has shown us good-will. Hillary is busy in New York City this weekend.

    So, I’m not bashing Mark Warner. I’m not questioning Markos’s gratefulness to Warner, or his decision to give Warner the keynote spot. But, I don’t think the Kossack community is ready to give up the fight for a more progressive candidate and more progressive politics a full two years before the election. And we are going to see a battle royale between those that think Russ Feingold or John Edwards are the proper candidates to carry the orange banner and those that are won over by coconut shrimp, and free kosmopolitans and t-shirts.

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  16. M. Simon says:

    Joe,

    Uh, you are a little behind the times. The center is not where it used to be. Which is why the Dems keep losing elections.

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  17. […] Update: As usual, James Joyner puts it well: Still, aside from the Dean case, where Kos definitely took money, and the Warner case, where we have no proof that Kos is getting anything for his shilling, the “Kos-ola” scandal seems misnamed. If there’s undisclosed pay-for-post going on, we have a scandal; otherwise, not so much. The Armstrong SEC thing combined with his blogging for Dean while clandestinely being on his payroll provide two strikes for Armstrong; so far, it’s only one strike for Kos. […]

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  18. […]    And, last but hardly least, Bless Their Hearts.  I guess this is what happens when you tag-team the ''important shit''. […]

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  19. […] Newsbusters has an interesting flurry in the Blogosphere with regards to the biggest Liberal blog, the Daily Kos.  There’s a lot of buzz today on the burgeoning scandal over whether or not DailyKos blogger Markos Moulitsas and his partner, Jerome Armstrong, have been scamming Democrats by taking money from them on the sly and then promoting them to blog readers as straightforward endorsements. Lots of good stuff from Donkey Cons, Outside the Beltway, Flopping Aces, Hot Air, PJM, Ace of Spades, and Riehl World View. […]

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  20. Donkey Cons says:

    Ko$ola: The story so far…

    Dan Riehl’s got the BIG SCOOP: Jerome Armstrong’s consulting firm collected over $161,700 from SEIU — perhaps the most notoriously corrupt union in America — in a single year! And DailyKos has been pimping SEIU!…

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  21. Dawn Patrol w/o MSM…

    IRAQ Barbarism — [One Hand Clapping – Donald Sensing] Al Qaeda says Zarqawi’s successor personally beheaded two American soldiers According to Maj. Gen. Abdul Aziz Muhammed-Jassim, head of operations at the Iraqi Ministry of Defense, the two Americ…

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  22. […] Mickey Kaus has the links: Kosolafest, 2006: Jim Geraghty has posted a “comprehensive Kos-Armstrong” timeline, which he claims shows an “interesting pattern.” (The pattern: Buy one, get one free!) … I debate the issue with Bob Wright here. Wright pooh-poohs the scandal. I say you don’t have to have illegality to have corruption, and this situation reeks of corruption. … Joyner tends to the Wright view, claiming there’s only “one strike” against Kos. … What about Ohio? […]

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  23. Les Jones says:

    In fairness to Kos, he disclosed that Dean was his client on June 9, 2003.

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  24. Tim Worstall says:

    Democratic Netroots…

    An artilce in The Groan about Kos, Yearly KOS, Jerome Armstrong, Mark Warner, Joe Trippi, Dean….well, you know the cast of characters. Really quite surprising, amazing even, that a report on the subject misses this week’s developments. The Blogola,…

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  25. acm says:

    Clients of Armstrong�s consulting business, including rather netroots unfriendly candidates like Mark Warner, strangely seem to capture Kos� fancy and get ringing endorsements

    I don’t understand this “ringing endorsements” business. Kos made clear that Warner’s presence at YearlyKos came about purely because he (and Reid) supported the conference when no other pols took it seriously, and he made explicit his unwillingness to choose among the various presidential hopefuls seeking his backing, calling that get-together “just a first date.” Yes, Warner is an example of a red-state Dem who made good, but beyond that, I don’t see the shilling of which much is being made…

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  26. James Joyner says:

    acm: There’s also a WaPo(?) interview in which Kos argues that Warner, not Hillary, is the candidate to watch. And the sudden about face on the Ohio race.

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  27. acm says:

    yeah, the Ohio thing is much more disturbing. I guess that in this, as much else, there’s a “buyer beware” aspect to following any one person’s take. of course, that also means that we need to be sure that the Top Bloggers are giving independent reads, rather than becoming an echo chamber for early opinionizers…

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  28. Relax, Put Your Feet Up, And Watch The Left Melti…

    It is not without some glee that I report on the meltdown of the left. Alright, to be fair, it’s just confluence of controversies that will eventually dissipate. But having suffered the smug arrogance of leftists who think anyone to the right of Jess….

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