GOP Ohio Governor Candidate John Kasich: Records Show He Bought Into A Goldman Sachs Internet Fund Before It Was Launched

CINCINNATI (TDB) -- John Kasich was chairman of the U.S. House Budget Committee in July 1999 at the height of the dotcom boom. His federal financial disclosure statement (a portion excerpted above) shows he acquired a stake in the Goldman Sachs Internet fund on July 1, 1999. But Goldman Sachs didn't launch its Internet mutual fund until October 1, 1999. Kasich's financial disclosure statement indicates he got a three month head start. The record suggests that Kasich -- who didn't seek reelection in 2000 -- was closely following developments on Wall Street. Did he have access to inside information? Goldman Sachs said it created the Internet fund to offer an opportunity to invest in "what may be the most compelling technological change in our lifetime." It was the go-go era before the dotcom crash. After leaving the House, Kasich went to work for Lehman Bros. Inc., a Wall Street investment bank that collapsed in 2008.

Copies of four years worth of Kasich's House financial disclosure reports are available here (pdf) at the Center for Responsive Politics. [Ed. Note: The financial disclosure statement about Goldman Sachs is for calendar year 1999. Kasich signed and dated it May 12, 2000. He certified the information was accurate: "I certify that the statements I have made on this form and all attached schedules are true, complete and correct to the best of my knowledge and belief." The word certify is printed in capital letters.] Zacks.com has data about the Goldman Sachs Internet fund, which trades under the symbol GITAX. And Money Magazine's online edition noted the fund's Oct. 1, 1999 debut with a headline that day saying, Goldman Cooks Up A Net Fund. Just in case there are any doubts about the October 1, 1999 launch date of the Goldman Sachs fund, the Daily Bellwether has retrieved a decade old Goldman Sachs press release that announces its opening to investors. The full-text is reprinted below:

"PR Newswire
October 1, 1999, Friday - 13:35 Eastern TimeGoldman Sachs Launches the Goldman Sachs Internet Tollkeeper Fund(SM); A Different Approach to Internet InvestingSECTION: Financial NewsLENGTH: 760 wordsDATELINE: NEW YORK, Oct. 1Goldman Sachs Asset Management today launched the Goldman Sachs Internet Tollkeeper Fund, a specialty equity mutual fund investing in growth companies poised to benefit from the expansion of the Internet. What is an Internet Tollkeeper? -- Internet Tollkeepers include established telecommunications, media, technology and Internet companies; -- These businesses, like a toll collector for a highway or a bridge, have the ability to grow revenue by increasing traffic (customers or sales) and by raising tolls (prices); -- These are companies with strong market share, brand recognition, recurring revenue streams and pricing power. What is the investment focus of the Goldman Sachs Internet TollkeeperFund? -- Primarily, companies that provide access, content (movies, music and videos), services and infrastructure (servers, routers, networks) to Internet providers and users; -- Secondarily, companies whose rapid adoption of the Internet has improved their business model, as well as Internet-based companies capable of generating long-term sustainable profitability, -- This approach contrasts that of "pure play" Internet funds investing in new dot.com companies. Who manages the Goldman Sachs Internet Tollkeeper Fund? -- The Goldman Sachs growth equity team, managers of the Goldman Sachs Capital Growth, Strategic Growth and Growth Opportunities Funds; -- A team with an 18 year institutional track record and over 150 years' combined investment experience. "The evolution of the Internet has transformed the economic landscape. Theopportunities that have been created are significant -- so, too, are therisks, particularly for investors," said Douglas Grip, President of GoldmanSachs Funds Group. "The Goldman Sachs Tollkeeper Fund offers a potentiallymore conservative approach to investing in what may be the most compellingtechnological change of our lifetime." Goldman Sachs Asset Management was formed in 1988, providing individualinvestors the opportunity to tap the resources of a premier global financialservices firm and put this expertise to work for them in their individualportfolios. As of June 30, 1999, Goldman Sachs Asset Management had $191.1billion in assets under management. Investors have access to more than 30 Goldman Sachs Funds, managedaccording to institutional investment processes that deliver region-,capitalization-, and style-specific equity portfolios; and benchmark-driven,research-intensive fixed income funds. These investment processes combine thebest of what Goldman Sachs has to offer: active management, global resources,significant research capabilities, risk management expertise, proprietaryquantitative models, and a team approach. Goldman Sachs (NYSE: GS) is a leading global investment banking andsecurities firm, providing a full range of investing, advisory and financingservices worldwide to a substantial and diversified client base, whichincludes corporations, financial institutions, governments and high net worthindividuals. Founded in 1869, it is one of the oldest and largest investmentbanking firms. Goldman Sachs is headquartered in New York and maintainsoffices in London, Frankfurt, Tokyo, Hong Kong and other major financialcenters around the world. Some risk factors that can negatively affect pure-play internet stocks canalso negatively affect Internet Tollkeeper stocks. The Fund is subject togreater risk of loss as a result of adverse economic, business or otherdevelopments than if its investments were diversified across differentindustry sectors. Securities of issuers held by the fund may lack sufficientmarket liquidity to enable the fund to sell the securities at an advantageoustime or without a substantial drop in price. For more complete information about the Goldman Sachs Internet TollkeeperFund, call 800-526-7384 and request a prospectus. Read the prospectuscarefully before investing. Goldman, Sachs & Co. is the distributor of the Goldman Sachs Funds. The Goldman Sachs Internet Tollkeeper Fund(SM) is a service mark ofGoldman, Sachs & Co. SOURCE Goldman, Sachs & Co. CONTACT: Kathleen Baum of Goldman, Sachs & Co., 212-902-5400COUNTRY: UNITED STATES (92%); 92%);STATE: NEW YORK, USA (92%); 92%);CITY: LONDON, ENGLAND (65%); 65%);COMPANY: Goldman, Sachs & Co. GOLDMAN SACHS GROUP INC (98%); GOLDMAN SACHS GROUP INC (98%); GOLDMAN SACHS FUNDS GROUP (64%); P (64%); ORGANIZATION: Goldman, Sachs & Co. GOLDMAN SACHS FUNDS GROUP (64%); TICKER: GS (NYSE) (98%); GS NDSEG##GS"

Ohio Republican Party Wrecks Kasich's Qualifying Day: Presser Surfaces Blasting 'Ties To Lehman Brothers'

CINCINNATI (TDB) -- In November 2008, one didn't have to work for Lehman Brothers to be considered unfit for government service in a high office. According to the Ohio Republican Party, one just had to have "ties to Lehman Brothers," the bankrupt Wall Street investment house. John Kasich, a former Lehman Brothers managing director (2001-2008), qualified today as the GOP candidate for governor of Ohio. Wall Street is in his past, and so is his own party's criticism Wall Street executives. Today, The Daily Bellwether links to this Nov. 24, 2008 Ohio Republican Party press release that first raised the Lehman Brothers fitness issue. The state GOP targeted Lawrence Summers -- an Obama economic adviser -- with a headline that said "Summers Is A Managing Director Of A Hedge Fund With Ties To Lehman Brothers." It turns out that Lehman bought a 20% stake in the D.E. Shaw hedge fund in March 2007. By that time, Kasich had been a managing director for six years -- he was full time with Lehman Brothers. Below is the actual text of the Ohio GOP's concerns about Lehman Brothers:

"Summers Is A Managing Director Of A Hedge Fund With Ties To Lehman Brothers:
"[Summers] Is A Managing Director Of A Hedge Fund, D.E. Shaw Group, At A Time Of Distrust Of Wall Street." (Deborah Solomon and Michael M. Phillips, "The Obama Transition: Summers And Geithner, Two Contenders For Treasury Job, Have Close Career Ties," The Wall Street Journal, 11/8/08)
Summers Took On The Role Of Managing Director In October 2006. "In October [2006] Lawrence Summers, former Harvard University president and U.S. Treasury Secretary under the Clinton administration, was named managing director at D.E. Shaw; Mr. Summers also is known for his role in the bailout of Long-Term Capital Management in 1998." (Jacob Bunge, "Lehman Brothers Buys Into D.E. Shaw," [New York] Daily News, 3/13/07)
In March 2007, Lehman Brothers Bought A 20 Percent Stake In D.E. Shaw Group. "Lehman has also heavily expanded its investment banking capacities in Europe and Asia, and has built up its asset management capabilities. Its business trading and arranging financing for hedge funds have also picked up just this week Lehman took a 20 percent stake in D.E. Shaw Group, one of the world's largest hedge fund managers." (Joe Bel Bruno, "Lehman Brothers 1Q Profit Up 5.6 Pct.," The Associated Press, 3/15/07)
D.E. Shaw Founder David Shaw Said "We're Very Pleased To Be Associated With Lehman Brothers." David Shaw: "We're very pleased to be associated with Lehman Brothers. ... Lehman has demonstrated a strong commitment to investment management, and will be a valuable resource to us as we continue our efforts to innovate within both the absolute-return and benchmark-relative asset management areas." (Jacob Bunge, "Lehman Brothers Buys Into D.E. Shaw," [New York] Daily News, 3/13/07)"

Ohio State GOP Vice Chairman Kevin DeWine: He Has Personal Knowledge Of "Thin' Military Records

DAYTON (TDB) -- The No. 2 official and chief fundraiser for the Ohio Republican Party has not spent a single day in military service, according to his biographies. Yet deputy GOP chairman Kevin DeWine audaciously is attacking Illinois Sen. Barack Obama's "thin record (that doesn't contain a single day of military duty)." DeWine is a state representative whose district includes communities near one of the nation's largest military installations -- Wright Patterson Air Force Base. There must be an armed forces enlistment office in that neighborhood. With wars and troops in Iraq and Afghanistan, DeWine doesn't seem to have taken any time to drop by and sign up for a hitch in uniform, thus enriching his own "thin record."

This bare spot in DeWine's resume is being exposed because he is behind a GOP fundraising letter that says the Obama campaign has been "outrageous and offensive." The sin: Gen. Wesley Clark said Sen. John McCain's service as a Naval Aviator and Vietnam POW does not mean McCain is qualified to be president. Clark did say McCain was a hero, which DeWine failed to note. Here's the text of DeWine's letter:

"Outrageous and offensive.
There’s just no other way to describe the gutter campaign tactic the Obama campaign pulled Sunday.
'I don’t think riding in a fighter plane and getting shot down is a qualification to be President.' That’s what Obama spokesman Gen. Wesley Clark said Sunday on national television.
Sadly, it’s not the first time the Democrats have tried to smear John McCain’s war record, and it won’t be the last.
Will you contribute $100, $250, or $500 today to help us push back?
We’re building an Ohio defense fund to counter these insidious attacks by Sen. Obama and his supporters.
John McCain spent five years being tortured as a prisoner of war in Vietnam. His heroic service to our nation stands in stark contrast to Sen. Obama’s thin record (that doesn’t contain a single day of military duty).
Please help us fight back.
Your contribution of $100, $250, or $500 will help us build a defense fund here in Ohio so we can counter these slash and burn tactics by a candidate who promised a “new” kind of politics but delivers more of the same.
Kevin DeWine
Deputy Chairman"

There is a fabrication in that letter, too. Gen. Clark is not an "Obama spokesman." Clark is a Democrat who supported Hillary Clinton. He endorsed Obama when Clinton ended her campaign. (H/T to BloggerInterrupted for the text of DeWine's letter.)

Ohio GOP's First 2008 Presidential Fib: Disaffected Dems Flooding Phones

COLUMBUS (TDB) -- Without offering a shred of proof -- probably because there isn't anything to back up the claim -- the Ohio Republican Party says Ohio Dems are flocking to its banner. Last week, the the Ohio GOP bragged that Obama "should be worried because the phones at our headquarters are ringing off the hook with 'coffee Democrats' asking how they can help John McCain."

But that word out of state GOP headquarters doesn't mesh at all with what insiders at local party offices in Cincinnati, Cleveland and Columbus are seeing. They don't seem to have noticed any kind of rush to align with the political organization best known for George Bush, Dick Cheney and Ken Blackwell, the biggest GOP loser in a governor's race in modern times. Phones "ringing off the hook" with Dems for McCain on the line? Laughable. The claim has the ring and tone of propaganda at best, an outright lie at worst. Hamilton County Republican Chairman Alex Triantafilou pointed out on his personal blog this weekend how he's frustrated that he can't sell more people on Republicanism.

"One of the great frustrations of being your chairman is the inability to change perceptions in many respects. Many people get their image of Republicans from the national news media and the top of the ticket. But, our party is much broader and we stand for so much more than the issues that affect the nation as a whole." Those don't sound like the words of someone whose phones are "ringing off the hook." If they were, he'd be rejoicing rather than frustrated.

As Howard Wilkinson, the respected political writer at the Cincinnati Enquirer notes today, McCain starts out in a hole in Ohio. He's not nearly as popular as Bush was in 2004 in the state's suburban counties. And he notes that in SW Ohio's Butler and Warren counties -- where Bush nailed down his 2004 victory --there is no wave of enthusiasm for McCain yet in sight. That makes the Ohio GOP's claim that Democrats are jumping aboard the McCain bandwagon sound silly. Wilkinson writes:

"Bush took 66 percent of the vote in Butler County, winning by a 53,629 vote margin. Next door in Warren County, Bush took 72 percent of the vote, defeating Kerry by 41,993 votes. To win Ohio, McCain somehow needs to replicate that success. Bush was immensely popular in those two counties, but he was also helped by the presence on the ballot of the state issue to ban gay marriage, which pumped up the vote among evangelical Christians and the self-described 'values voters' of whom there are many in those counties. McCain won't have that kind of hot button issue on the ballot . . ."

Ohio Republican Party: Shifts Fire From Hillary To Obama

CINCINNATI (TDB) -- For most of the past year, Hillary Clinton has been the prime target of GOP strategists. This week, the Ohio Republican Party proclaimed Obama even more liberal than the woman who's been its sturdy arch-villain. Is the shift a sign that Republicans now recognize the Illinois senator poses a greater threat? After all, just 10 days ago ORP deputy chair Kevin DeWine told the Clermont County Chamber of Commerce that Clinton was the candidate his party preferred to face. Indeed, he said he endorsed her run -- a counterintuitive remark.

Now the attack on Obama has appeared on the ORP's official blog:

"And this is the guy Democrats think will unite the country? The only part of the country he's uniting is the far left wing of the Democratic Party."

GOP's Kevin DeWine and Dem Chair Chris Redfern: This Year, Ohio's Prezzie Primary Counts

BATAVIA, Ohio (TDB) -- The two party leaders shared a stage at the Clermont County Chamber of Commerce today and agreed: Ohio's March 4 presidential primary now seems certain to play a significant role in selecting nominees for the White House. Deputy GOP Chair Kevin DeWine said he's convinced the early primaries and Super Tuesday on Feb. 5 won't lock things up for any candidate.

"It's my personal opinion it won't be decided by then. Hold on, because here come the presidential candidates."

Dem Chair Chris Redfern was equally as certain: "Ohio will be important, obviously, in November. But it appears Ohio will play a role in the primaries as well. There's no end in sight."

Traditionally, Ohio is a key state in the general election and often decides who wins the presidency. Its primary -- which comes late in the cycle -- is usually meaningless because the everybody already knows who the Republicans and Democrats plan to crown at the national conventions. So far, that hasn't happened.

DeWine and Redfern also agreed the run up to the November vote for president will be more intense in Ohio than ever before. Both said the campaign will be fought across all 88 counties, and Redfern said John Kerry lost in 2004 because his strategists focused too narrowly on urban areas. Redfern said Kerry could have won if he'd spent money in small towns, "just a few bucks on rural radio in places like Fulton County." He said the Dems have no intention of ignoring Clermont County this year even though it is overwhelmingly Republican.

DeWine said the state Democratic Party "now has a more organized 88-county strategy" that the Republicans intend to match. "We are planning to play in counties that have a dark blue Democratic tint to them."

Both said Ohio was crucial in November, but DeWine elaborated:

"Ohio has a long history of being on the side of the winner. The bottomline is: If you don't win the Buckeye State you don't win the White House. Especially if you are a Republican."

A questioner from the audience wondered who Redfern was backing -- Hillary, Obama or John Edwards. The state Dem chair said he was staying neutral. GOP leader DeWine said he had endorsed Hillary Clinton. That remark wrinkled some foreheads and led to a round of nervous laughs in the room. DeWine continued, "In the Democratic primary."

Ohio Republican Party: Its Official GOP Blog Echoes Strickland's Iowa Caucus Concern

CINCINNATI (TDB) -- Ohio's Democratic Gov. Ted Strickland has been catching flak over a comment that the Iowa caucuses make "no sense." There is speculation that the remark will go down as the governor's gaffe. Now the Ohio Republican Party -- no ally of Strickland -- has linked to a USA Today editorial that seems to share his sentiment that Iowa should not have such crucial power over the presidential selection process. A link to the Ohio GOP blog is here.

The USA Today editorial it cites raises concern that Iowa's voter participation is too low, the voting is too early, and the state is too tied to an agricultural economy to be any kind of stand-in for the rest of the nation when it comes to the serious job of picking a president. The Ohio GOP -- by giving that concern prominence on its partisan Web site -- seems to be saying it agrees with Democrat Strickland. Here's USA Today:

"It seems odd that candidates would spend months, and millions of dollars, in Iowa in pursuit of an election that would barely constitute a neighborhood in some large American cities. It should. Iowa is not tiny, 30th in population according to the Census, but its time-consuming caucus process means that only 8% of the population will participate."

The newspaper said that about 87,000 Republicans will caucus, according to predictions ahead of the voting -- that's not even a full house at a Washington Redskins game. For Ohioans: It's not even close to a full house at Ohio Stadium when the Buckeyes play; it's just a tad smaller than the population of Parma, Ohio.

Ohio GOP Straw Poll: Fred Thompson Wins, Rudy No. 2

COLUMUBUS (TDB) -- The Ohio Republican Party's news release is here. Apparently, the former Tennessee senator has some support in the Buckeye State.

Ohio Republican Party: Hillary Swipes Edwards' Rhetoric

CINCINNATI (TDB) -- The Ohio Republican Party is out with a 10-page background document from RNC headquarters that roughs up Sen. Hillary Clinton and contends she has been borrowing her stump themes from others. Specifically, the GOP says she is echoing Democratic rival John Edwards, who trails her in the national polls but has been running strong in Iowa. "In Iowa, Hillary adapted Edwards ideas and rhetoric as her own," the GOP says. (Check page 2 of the document.)

The Republicans point out a handful of standard oratorical flourishes in phrases like "basic bargain" and "play by the rules" that crop up in Edwards campaign appearances over the past few years. And, of course, they both talk a lot about health care, especially for children. The GOP says Hillary has sounded too eerily similar recently -- but the material it cites seems to fall somewhat short of full copyright infringement.

Still, the GOP wisely is monitoring every word and may eventually catch one of the Democrats delivering another candidate's script. Wouldn't that make great TV?

Eminent Domain Controls: Two Ohio GOP Lawmakers Seek Statewide Vote

COLUMBUS (TDB) -- Two Northeast Ohio senators plan to introduce a resolution next week seeking a statewide referendum that will strengthen private property rights and curb the ability of local governments to take land for city projects. The proposed constitutional amendment has the backing of Ohio Sen. President Bill Harris.

Sen. Kevin Coughlin, R-Cuyahoga Falls, said he does not believe the use of eminent domain is consistent across Ohio. "I believe Ohio voters want the opportunity to support private property rights at the ballot box. Eminent domain should be used sparingly and only when it benefits the public as a whole. Our laws should reflect that and leave no wiggle room for government to abuse its power," Coughlin said in a statement released by the state Republican Party. His co-sponsor, Sen. Tim Grendell, R-Chesterland, said "from Lake Erie to the Ohio River, all Ohioans deserve to have their private property rights respected and protected."

Traditionally, eminent domain has been used by government to acquire property for college campuses, airports, roads and other public purposes. Recently, it has begun to be used for economic redevelopment. Cities would try to take land for private developers who then would build shopping centers or offices. In Norwood, a Cincinnati suburb, the Ohio Supreme Court ruled last year that a shopping center project was improperly using eminent domain to remove homeowners.

A GOP news release about the proposed eminent domain resolution in the Ohio Senate is HERE.

Ohio Republican Party: No Way To Treat A Lady

COLUMBUS (TDB) -- The Ohio Republican Party has a trio of postage-stamp sized photos on the front-page of its official Web site that display the faces of Democratic presidential frontrunners John Edwards, Hillary Clinton and Barack Obama. Edwards and Clinton are caught with unflattering facial expressions that make them look like total goofballs. Are the Republicans trying to say Hillary is casting a spell, that she just discovered Chelsea joined the Marines, that her shoes are too tight?

Sen. Obama gets the straight treatment. His mug isn't the target of the GOP croppers, probably because the Republicans feared a backlash if they mocked a black man. Of course, they have no trouble mocking a lady, do they? The photos appear over a fundraising squib. Are the Dems supposed to frighten Republicans out of their money?

But the biggest picture on the Ohio Republican portal is Abraham Lincoln, the Great Emancipator and first GOP president. A national holiday Monday will memorialize Lincoln's importance to the nation. We'll remember that he spoke of charity to all and malice toward none of our fellow Americans -- a sentiment apparently beyond the zealots who like to pose their political foes in goofy poses.

Lincoln himself was no Hollywood matinee idol, and it is said he endured some cruel pokes about his appearance. He was called common-looking. There are several versions of his reply to this put down. "God must have loved the plain people: He made so many of them." Or, "God loves the common man, he made so many of them." Or this story, "He (Lincoln) was in a party of plain people, and, as it became known who he was, they began to comment on his appearance. One of them said -- 'He is a very common-looking man.' The president replied -- 'The Lord prefers common-looking people. That is the reason he makes so many of them."

I wonder what Lincoln would have to say about the pictures on the GOP portal. Maybe, "You can fool some of the people all of the time, and all of the people some of the time, but you cannot fool all of the people all of the time."

Ohio GOP: Reimbursed $$$ For Petro Aid

COLUMBUS (TDB) -- Conservatives who suspect the Ohio Republican Party tilted in favor of former Attorney General Jim Petro during his unsuccessful primary against Ken Blackwell last year now have some evidence. A $9,000 check went from Petro's campaign to GOP headquarters to reimburse the state party for unspecified personnel services during the contest to win the 2006 gubernatorial nomination.

The payment shows up amid year-end campaign expense reports that Citizens for Jim Petro filed in Secretary of State Jennifer Brunner's office this week. The money is not listed as a political donation. Instead, it is reported as "Misc-Balance Due Primary Personnel Svs." The line item suggests somebody at state headquarters did some work for the Clevelander, and that the Petro camp was billed $9,000.

The report is a public document that can be viewed by clicking here and reading through the pages. The payment was dated Aug. 1, 2006.

On the other side of the transaction, the Ohio GOP's post-primary finance report for its state candidate's fundraising arm discloses a $9,000 "contribution" from Citizens for Petro on that date. The more detailed personnel services explanation shows up in Petro's paperwork, which was filed after Blackwell was out of office and out of the picture as a force majeur.

During the primary, there were reports that state GOP headquarters -- which was supposed to be neutral -- actually preferred Petro over Blackwell. The Toledo Blade said in March that $1.49 million in contributions had gone to his campaign from a party account. Until the Petro-Blackwell contest, Ohio GOP Chairman had managed to avoid primaries by convincing candidates not to run against each other. In 1998, for example, he got Blackwell to run for Secretary of State and drop his plans to run against former Gov. Bob Taft.

Blackwell was ambitious and easily defeated Petro in the primary last May, but he lost big in November to Ted Strickland, who reclaimed the governors office for the Democrats after 16 years of Republican control. Petro is out office and working as a private lawyer in Columbus, but his expenditure report shows he donated thousands of dollars to candidates last year, including $10,000 to Betty Montgomery, who hoped to succeed him but lost to Democrat Marc Dann. Petro also gave money to Phil Heimlich, who for a time was his running mate but dropped off the ticket to run for re-election as a Hamilton County Commissioner. Heimlich lost. Petro also made contributions to State Sen. Joy Padgett, who replaced Heimlich as his running mate. Padgett later tried to win a congressional seat, but was defeated by Democrat Zack Space.

There did not seem to be any money that flowed from Citizens for Jim Petro to Blackwell. (Maybe the donations are there and I missed them.)