The Guardian
Secrets of the billionaire backing Gingrich's shot at the White House
Sheldon Adelson is not running for office – but his cash could swing Tuesday's Florida primary
By Paul Harris
Abraham Foxman, the amiably chatty director of the Jewish civil rights group, the Anti-Defamation League, has a story to tell about his friend, the 78-year-old multi-billionaire casino mogul Sheldon Adelson.
Adelson, who is America's eighth richest man and has given millions of dollars in support of Newt Gingrich's presidential bid, was having dinner with Foxman in Las Vegas several years ago. Foxman let slip that he was having to miss an invitation to the White House from the then president, George W. Bush. Foxman explained it was impossible to get a commercial flight. Adelson replied: "If the president of the United States asks you to go, you go." Then he gave Foxman the use of his private plane.
Foxman asked Adelson if any condition was attached to the spontaneous act of generosity. "The condition is that you tell President Bush that is how you got there," said Adelson. Foxman made it in time to meet the president.
It is a classic vignette to describe the power and style of Adelson, a man who has given scores of millions of dollars to Republican and Jewish causes over the years but who only now – by backing Gingrich – is becoming known to the wider public. It shows the reach of great wealth and how it mixes with the most powerful people on earth. It also shows Adelson's willingness to use that wealth for causes and people he believes in.
Gingrich, the latest beneficiary of Adelson's goodwill, suddenly has an outside chance of becoming president. The veteran firebrand upset the entire Republican race by coming from behind to record a stunning victory in South Carolina. The win rocked the campaign of the frontrunner, the former Massachusetts governor Mitt Romney, and pitched the two candidates into a showdown in Florida on Tuesday. If Gingrich can win there, the contest could go all the way to the party's convention in Tampa, Florida, in August. And if Gingrich wins the nomination, then the first person he ought to thank is Adelson.
Together with his wife Miriam, Adelson has donated $10m to a "Super PAC" backing Gingrich's presidential bid. Super PACs (political action committees) are a new group of organisations, created by a recent loosening of campaign finance laws, that can accept unlimited donations as long as there is no official co-ordination with a candidate's campaign. The donations are among the largest from individuals in US political history. While other rivals to Romney struggle for cash, Gingrich does not. The Super PAC, Winning Our Future, has put TV ads all over the airwaves and even bought space for a half-hour anti-Romney documentary that helped give Gingrich his victory in South Carolina.
Critics have said Adelson's backing of Gingrich ushers in a dangerous new world where America's wealthiest people might feel able to single-handedly sponsor a major candidate's bid for the White House.
In a system already awash with campaign donations and money from lobbyists, such a level of financial backing has some worried. "It is an arms race of money. You can imagine a world where you can't get elected without the backing of a billionaire," said Professor Noah Feldman, a constitutional law expert at Harvard. "Adelson is not breaking any rules. But the rules are mad," he added.
Adelson and his wife do not see it that way. "Our motivation for helping Newt is simple and should not be mistaken for anything other than the fact that we hold our friendship with him very dear and are doing what we can as private citizens to support his candidacy," they said in a joint statement issued to the Observer.
The Adelsons believe their contributions to Gingrich differ only in scale, not kind, from those of any other citizen. "Our means of support might be more than others are able to offer but, like most Americans, words such as friendship and loyalty still mean something to us," they added.
Insiders at Adelson's company, Las Vegas Sands Corp (LVSC), say the billionaire does not understand why some groups – such as labour unions – do not get the same media scrutiny when their campaign contributions are likely to be in total much larger. "The attention he is getting is a little puzzling to him," one company source said. That raises an interesting thought. Labour unions give money to political campaigns in order to further their interests and that of their working members. So, in turn, what does Adelson want for his money? "Elections are not a 'bro-mance'. You expect something in return. Everyone knows that," said Feldman.
Adelson was not always a rich rightwing Republican. He was born poor in the liberal heartland of Massachusetts, where being a Democrat was the norm. His father, a Jewish immigrant from Lithuania, was a cab driver in Boston while his mother ran a knitting shop. They brought up Adelson and his three siblings in a tenement in a tough neighbourhood of the town of Dorchester. For a while the family slept together in the same room.
But Adelson had street smarts that seemed perfect for business. His first job, with money borrowed from an uncle, was at 12 when he sold newspapers on street corners. At 16 he was running a vending machine business. He became a court reporter, joined the army, sold de-icers, invested in real estate and packaged toiletries among many other things. Some ventures worked, others did not.
The idea that launched Adelson into the world's financial elite was Comdex, a computer trade show that he launched in 1979. It grew into a huge hit, attracting tens of thousands of visitors. "He does not tolerate mediocrity. He just does not 'settle' for anything," said Jason Chudnofsky, a former Comdex executive who worked with Adelman for years.
Even back in the 1970s, according to Chudnofsky, Adelman boasted his business acumen would one day put him in the company of world leaders. "He said we would deal with ministers and presidents of countries. Everything he said then is coming true now," Chudnofsky said.In 1989 Adelson nurtured his now booming convention business by buying the old Sands hotel in Las Vegas. By 1995 Comdex was sold with Adelson reportedly earning $510m for his controlling stake. It was just the beginning. Adelson's empire now includes the Venetian and the Palazzo in Vegas and has expanded into Asia. He is now a billionaire at least 20 times over.
It has also made him a Republican. He was apparently converted to the rightwing cause by William Bush, elder brother of the first President Bush, after they met during the 1988 election.Adelson once told a Washington party he "switched immediately" after a talk with Bush.
Through the 1990s and 2000s, as Adelson got richer and also battled trade unions at his Las Vegas casinos, he became more and more politically active. He was generous to George W. Bush's re-election campaign in 2004, and by 2008 helped bankroll Freedom's Watch, a group that ran ads against Democrats and in support of the Iraq war, to the tune of at least $15m.
He also became a backer of Gingrich and a personal friend. They first met while Gingrich was Speaker of the House in the 1990s. Since 2006 their ties have also been financial. In that year Adelson gave $1m to a group called American Solutions for Winning the Future that served as Gingrich's political organisation. By 2010 Adelson had donated around another $6m to the group as Gingrich toured the country, touting his causes and contemplating a presidential run. Eventually this group turned into the Super PAC Winning Our Future. The cheques from Adelson kept coming.
It is not just the American right that is Adelson's great political passion. There is also Israel. Always proud of his Jewish heritage, Adelson's activism took a pronounced leap when he married his second wife, Miriam, in 1991. She was an Israeli citizen who had been working in New York. The Adelsons are friends of Israel's prime minister, Binyamin Netanyahu, and Adelson purchased a Hebrew-language newspaper to support him.
Adelson is an impassioned opponent of an independent Palestine. He has given at least $60m to the charity Taglit-Birthright, which brings young Jewish Americans on trips to Israel. He has established a thinktank in Jerusalem and given large sums of cash to Yad Vashem, the Holocaust research centre. In the US he has donated to the lobbying group the American Israel Public Affairs Committee, helping fund the trips of Republican congressmen to Israel.
All of this dovetails with Gingrich's policies on Israel. Gingrich has vowed that on the very first day of his administration he would order America's Israeli embassy to move from Tel Aviv to Jerusalem. He has called for regime change in Iran and repeatedly denied that Palestinians are a real people, saying instead they have been "invented". In domestic politics, Gingrich has advocated getting rid of child labour laws so that poor children can work as janitors in their schools. He is an ardent fan of slashing federal government and loosening Wall Street regulations. He has warned that President Obama is a socialist who threatens America's traditional way of life. What Adelson thinks of these exact views is less known. Though often happy to talk to the business press, he rarely speaks to the media beyond that. His press spokesman, Ron Reese, said Adelson had turned down at least 50 interview requests in recent days. But Adelson is happy to use his billions to defend himself. In 2008 his lawyers tried to get reporters barred from a case brought by someone suing for compensation they said was owed after a deal in Macao.
He also sued John L Smith, a Las Vegas journalist over a book he wrote. Though Adelson eventually dropped the case after several years and paid some of Smith's legal costs, the journalist was still forced into bankruptcy. "Sheldon is a bully. He likes to get his own way. He hates it when people disagree with him... he does not like the spotlight when it is a critical spotlight," Smith said.
Nor is Adelson's life without controversies now. He is fighting several lawsuits in Nevada. One, brought by former employer Steve Jacobs, accuses Adelson and his firm of wrongful dismissal after Jacobs claimed he refused to follow instructions to dig up dirt on Chinese officials that could be used as "leverage" to help the business in Asia.
Adelson and Las Vegas Sands Corp have denied the charges, saying they come from a disgruntled employee. But the Securities and Exchange Commission has subpoenaed the firm for documents. The Nevada Gaming Board has also launched an investigation.
Another case has been brought by Adelman's former driver, Kwame Luangisa, who alleges he is owed overtime payments from the billionaire and his firm. Again, the accusations have been denied.
Adelson's personal life too has had its legal problems. In 1997, his sons sued him, claiming he had tricked them into selling their Comdex stocks back to him for less than they were worth. They lost. But the implications of such a family dispute hitting the law courts clearly struck Judge Hiller Zobel, who wrote in his judgment that the trial was "like something from the playwright Arthur Miller". Evidence had revealed the sons as "self-indulgent, substance-abusing, over-pampered" and depicted Adelson as a "harsh, demanding, unfeeling" person, the judge wrote.
It was a rare glimpse into Adelson's private life. Smith, who knows first hand what it means to cross Adelson, thinks his own experience told him a little of what Adelson could be like. "He is fascinating. He's worth billions, but he's pugilistic as the day is long," Smith said. "In his mind he's constantly under siege."
There is certainly no doubting the passion Adelson feels for his causes or the lengths he will go to fight for them. In 2008 he flew 40 wounded US soldiers for a weekend in Las Vegas on a private jet. They stayed in suites usually reserved for high-rollers. When one soldier, who had brought his girlfriend along, decided to get married in the city, Adelson paid for that, too. "He's known as this tough person, but one-on-one he can be a softy," said Foxman.
Not that Mitt Romney would agree. ** The money Adelson has poured into Gingrich's cause has battered Romney's campaign. An Adelson-funded Gingrich has become Romney's most implacable foe. Even if Gingrich loses in Florida, he will be able to fight on with a billionaire's backing. "The past would suggest that they [the Adelsons] will continue to finds ways to support Newt in the future," said a company source close to Adelson. Chudnofsky put it more bluntly. "He's not going to stop. If he's said he is going to support Gingrich, then he will go all in."."
http://www.guardian.co.uk/world/2012/jan/28/newt-gingrich-sheldon-adelson-billionaire
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