Why is Bruce Lisman spending hundreds of thousands of dollars to ‘start a conversation’?

Campaign for Vermont became a player on the political scene in Vermont late last year — thanks to the largesse of a single wealthy individual and an aggressive local media advertising blitz.

But eight months since a group of prominent conservatives founded the 501(c)(4) organization, its purpose remains unclear.

What is Campaign for Vermont, and more to the point, what is the group trying to accomplish?

The founder of Campaign for Vermont, Bruce Lisman, says the organization doesn’t adhere to a political point of view, but the group has pushed for fiscally conservative ideas outside the traditional Republican Party construct.

Campaign for Vermont, through hyperlocal radio advertising, has indirectly criticized “Montpelier,” a.k.a. Democrats who hold the governor’s office and the Statehouse, for “out-of-control” state spending. It has also chastised the executive and legislative branches for not being transparent enough about the way taxpayer dollars are used by state government.

In a recent email missive to supporters, Lisman wrote that “Campaign for Vermont believes that higher property taxes, increased electric rates and a risky health care scheme will strangle a vibrant economy.”

Lisman, a native of Burlington’s North End, and a former executive with Bear Stearns and J.P. Morgan, says he is trying to draw attention to the state’s financial future through a “campaign for a prosperous economy.”

Listen closely to GOP candidates such as Randy Brock, who is running for governor, and Wendy Wilton, who is making a bid for state treasurer, and familiar Campaign for Vermont themes emerge.

After months of Campaign for Vermont’s focus on “prosperity,” Brock’s media consultant Robert Wickers said in a statement that “[a]s Vermonters learn more about Randy, and hear his positive message of economic growth and prosperity, this race will tighten.” Brock and Campaign for Vermont have also criticized the growth of the budget this year (an overall rate of 6.3 percent).

Wilton, at her campaign launch for treasurer, echoed that sentiment: “Information is key, but it’s the ease of that information that’s really important too. Because it’s got to be readily available, you’ve got to be able to see it and understand it, and it can’t be in some really arcane spot within the state’s website where you’d never find it even if you put it in a search function. It’s got to be somewhere where people can see it easily.”

Jake Perkinson, chairman of the Vermont Democratic Party, suggests that Campaign for Vermont might be a “launching pad” for a political candidate — most likely Lisman himself. Though he is the face of the organization — his portrait is on email messages and the website — Lisman has said repeatedly that he has no interest in running for office.

Kevin Ellis, a communications strategist with KSE Partners and a supporter of Democrat Gov. Peter Shumlin, says Campaign for Vermont is the Vermont GOP’s ad hoc messaging machine, laying the electoral groundwork for Republican Party candidates this election cycle.

He also speculates that Lisman wants to be a kingmaker. Ellis says Campaign for Vermont’s ubiquitous advertising could be a potential prelude to financing candidates in 2014 — in the event that Vermont’s campaign finance limits are knocked down in the courts.

“Sure, he may give money to candidates,” Ellis said. “But I think he is a millionaire from Wall Street who came to Vermont and wanted to be a player. Spending this money is the best and fastest way to do that. Spending this money makes him a political player, scares the heck out of Democrats and makes him the toast of the Burlington cocktail party circuit among Republicans. But that is a long, long way from playing on the varsity team against pros like Peter Shumlin, Bernie Sanders and Pat Leahy. To steal a phrase from David Plouffe, those guys play chess. Lisman is still playing checkers.”

Hitting the airwaves

Lisman, 65, is the mind and the money behind Campaign for Vermont, which has launched 19 radio, print and web advertising campaigns since Nov. 23, 2011 — all of which were paid for out of his own pocket. As of April 25, he had spent $194,343 on advertising alone, according to a lobbyist filing with the Secretary of State’s office.

With nearly ubiquitous radio spots playing up to six times per day on more than 10 stations statewide, the advertising blitz has drawn attention to Lisman from his detractors and supporters alike.

Until Jan. 1 of this year, Campaign for Vermont’s advertisements advocated broadly for transparency, “defining prosperity” and a vibrant economy. One ad series, for example, encouraged Vermonters to donate to the United Way during the holiday season. Though Campaign for Vermont’s website, which included specific talking points was online at that point, the messages the radio ads promoted were not topical.

As the legislative session began, so did the assaults on Democratic initiatives for alternative energy, Vermont’s health care exchange plan, and the state budget. Campaign for Vermont launched two new radio ads, one criticizing Vermont’s health care exchange – “Vermont’s Act 48 will create an exchange with only one or two [health insurance] carriers. That’s not choice,” Lisman says in the advertisement – and another calling for accurate and realistic analysis of renewable energy and its costs before the state moves forward.

Lisman’s biggest issue is the economy, especially with regard to state taxes and spending priorities, shortly followed by transparency. The former Wall Street executive wants the Legislature to give taxpayers estimates for proposed programs, so lawmakers and citizens alike can make decisions based on real cost analyses.

In an ad launched Feb. 7, Lisman encouraged Vermonters to ask four questions of their legislators on Town Meeting Day: “Are the policies they are considering based on facts and common sense? Will the policy lead to shared prosperity? Is the policy being developed in a non-partisan manner? And lastly, are they listening to you?” In a run of newspaper advertisements in 26 weeklies across the state the campaign reiterated the same message the week before Town Meeting Day.

Campaign for Vermont, Lisman says, is based on principles all Vermonters can agree on.

“Can you tell me if there is something wrong with building a vibrant economy?” Lisman said in an interview. “Honestly?”

The answer, presumably, is no. But Lisman, his past and the views he promotes have made some Vermont politicos uneasy.

A scrape with the Democrats

Campaign for Vermont came under fire from the Vermont Democratic Party after launching a Feb. 6 radio advertisement which they claimed was an attack ad advocating against the re-election of Democrat Gov. Peter Shumlin — a candidate in an upcoming election.

In a Feb. 21 letter to Attorney General William Sorrell, Jesse Bragg, then the executive director of the Vermont Democratic Party, alleged that Campaign for Vermont had spent more than $500 on the ad and hadn’t registered with the Secretary of State as a political committee. Bragg claimed the advertisement “can only be viewed as furthering the purpose of opposing [Shumlin’s] candidacy and/or influencing the outcome of the governor’s election.”

Lisman argued the Campaign for Vermont was not a political committee, and the Vermont Attorney General’s Office ultimately ruled in his favor, determining that the advertisement was compliant with all relevant laws. “The Attorney General’s Office concluded that the ad addressed a policy issue that is currently pending in the Vermont Legislature and did not demonstrate that its purpose was to support or oppose a candidate for Vermont office,” Sorrell’s office announced in a press release.

The issue was settled, but Lisman’s group whose stated purpose was to put “progress ahead of partisanship” had driven a wedge between Republicans and Democrats.

Jack Lindley, chairman of the Vermont Republican Party, said the complaint was “part of the arrogance of single-party power,” and called the charge “frivolous.” He commended Campaign for Vermont for its work.

“Their thinking is pretty clear and their activities with regard to bringing in a better Vermont are well-intentioned and directly to the point,” Lindley said.

Perkinson, the Vermont Democratic Party chair, had other thoughts about the group’s obligations under its 501(c)(4) IRS status.

“They should be able to make those arguments,” he said, “but I don’t think they should be able to cloak those in the name of education and social welfare for the common person when they’re anything but.”

The Democrats fear something bigger from Lisman et al. down the line. Perkinson says he thinks Campaign for Vermont is in the early stages of becoming a vehicle for electing Republican candidates.

“In my estimation, either a stalking horse or … a launching pad for someone who wants to be involved in politics going forward,” he said.

Such a move would be possible, depending on the outcome of a case pending in Vermont District Court, where the Vermont Right to Life Committee is suing Attorney General Sorrell over the criteria defining a political committee. Right to Life argues the financial reporting requirements triggered by spending $500 or more on ads relating to an election are too burdensome. The organization’s hope is to skirt the triggers as long as most of its spending is not on such ads.

If the Vermont Right to Life Committee, which is represented by James Bopp, an attorney who has made fighting campaign finance limits in states across the country his personal quest, according to Seven Days, wins the case, the state would have to allow unlimited — and untraceable — spending by groups like Lisman’s and KSE’s Vermont Priorities.

Eve Jacobs-Carnahan, the assistant attorney general defending the state’s interests, says it’s possible the Vermont Right to Life decision would allow groups to spend unlimited amounts of money on election-based advertising as long as such ad expenditures were not the group’s “major purpose.”

Under IRS rules, a 501(c)(4) is a “social welfare organization,” but according to the IRS “[s]eeking legislation germane to the organization’s programs is a permissible means of attaining social welfare purposes. Thus, a section 501(c)(4) social welfare organization may further its exempt purposes through lobbying as its primary activity without jeopardizing its exempt status.” Launching ads for or against a candidate does not qualify as social welfare spending, but 501(c)(4)s are permitted to engage in political activity, “so long as that is not its primary activity.”

If the organization’s “major purpose” (Carnahan says that would likely be a function of where funds are dedicated) is not ads seeking to influence a Vermont state election, it would not be required to register with the Secretary of State as a political committee, even if it spent over the current $500 limit.

“There wouldn’t be any transparency, the public wouldn’t know where the funds were coming from,” Carnahan said.

Unlimited spending rules in North Carolina allowed a wealthy businessman, Art Pope, to finance a conservative takeover of the state legislature in 2010. ( http://www.newyorker.com/reporting/2011/10/10/111010fa_fact_mayer)

When asked whether he intended to cause a similar political sea change in Vermont, Lisman said no. He wants Campaign for Vermont to foster debate — not financially back candidates.

“Is what we’re doing for somebody’s personal gain, or is there something bigger, more important, to discuss?” Lisman said. “And I think it’s the latter, and I think that because – and let me just be clear – I think this is a worthy effort that we should dedicate, in my case some money and time, and try to capture people’s attention on some issues we’re discussing.”

The spending spree on local advertising

Money indeed. An April 25 filing with the Secretary of State’s office gave the figure: $212,343. Lisman confirmed that all the money came from him, with $15,000 paid to lobbying firm Capital Connections, $3,000 in “other expenses,” and $194,343 paid out in advertising (Disclosure: Campaign for Vermont paid $5,382 for a sponsorship placement with VTDigger.org in March 2012, and Lisman personally gave two $5,000 donations to the Vermont Journalism Trust in 2011.)

In an effort to track the group’s spending across the state, VTDigger went to the offices of WDEV, WORK, WWFY, WSNO and WVMT where the stations disclosed advertisement spending by Campaign for Vermont. All radio advertisements were billed to Marianne Campbell, media director of McLaughlin & Associates, a New York firm that features on its website a Washington Times quote dubbing it one of the best Republican polling outfits.

In a separate trip to WVTK in Middlebury, the station declined to give the information. When VTDigger asked Lisman to disclose the group’s spending on advertising with WVTK, he declined.

Though the group has advocated heavily for transparency in its advertising, Lisman said its April 25 filing of lobbyist disclosure forms with the Secretary of State was enough. The forms report spending by and payments to lobbyists by category including advertising, telemarketing and other expenses.

“We’ve disclosed the important things so that the public can see what we’re doing, and the law didn’t require us to do it,” he said.

Neither Campaign for Vermont nor the radio stations it advertises with are legally required to disclose the ad spending information, and Campaign for Vermont, Lisman says, was not required to file lobbyist disclosure forms with the Secretary of State. The group filed, Lisman said in a press release, because “Campaign for Vermont believes in transparency and is disclosing, as promised to the public, our expenditures related to direct and indirect lobbying for the period January 1 to March 31, 2012.”

Lisman said he refused to disclose specific spending with certain radio stations because the “realm of detail” for such spending was too specific.

“These questions are of interest,” Lisman said, “but we choose not to disclose it, and it’s for the radio stations to decide.”

At WVMT, a conservative talk radio station where Campaign for Vermont spent $25,380, the group received roughly $2,000 in free advertising. Station owner and manager Paul Goldman said he donated the free advertising because of how much Campaign for Vermont had spent.

From Willard Street to Wall Street

Lisman was born and raised in Burlington, where he lived with his brother and their parents, Irving and Lily Lisman, on North Willard Street. Lisman fondly remembers his father’s refrain about his home neighborhood: “My father always said ‘the best thing about the North End is leaving,’ and we did,” Lisman said. When Lisman was still in elementary school, the family moved to the South End.

Lisman graduated from Burlington High School and went on to UVM, where his mother worked as a secretary to earn discounted tuition for him and his brother.

After graduation, Lisman moved to New York City and got a job as a file clerk at the financial firm Bear Stearns.

“I didn’t start in a management position or in a senior position,” Lisman said. “I started as a basic clerk, which is filing different colored pieces of paper from different-colored files. And the guy who transitioned me, which took probably less than 90 seconds to train me, I think he hung out for 10 minutes, said, ‘Try not to think too much, because when you do that, you’re going to put the reds in the pink, and they’re really gonna get pissed at you.’”

Lisman climbed up through the ranks of the company, from clerk to trading assistant to junior analyst to analyst to director of research, and finally he became co-head of Global Equities.

Bear Stearns folded as a result of the 2008 financial collapse, and its leadership faced criticism for reckless trading practices, but Lisman says the criticisms are baseless.

“As the crisis took hold, you could see clearly it wasn’t one company or one type of transaction or even one country that you could assign a central locus of where the crisis began,” Lisman said. “That’s an absurd, simplistic, and probably ideologically oriented point of view. There’s nothing out there that says that. People who say that are making a great leap. We were, as I look at it, a canary in the mineshaft.”

Lisman says his division had no part in the problems that brought Bear Stearns down.

“Our business had nothing to do with the failure of the world,” he said. “It was, I wouldn’t say plain vanilla, but we were large and profitable almost to the very end.”

The economic crash of 2008, as Lisman sees it, was the result of the world becoming too used to an extended period of financial growth.

“It was wretched excess at the end of a very long economic cycle that made people too comfortable,” he said. “Public policy people comfortable that they could continue on, and banks and lenders thinking that things are great and they’re smarter than the next guy pursuing policies that had some wretched excess attached to it, too much greed, could still work. It didn’t.”

Vermont in the new world

The 2008 collapse changed the world, Lisman said, in ways many leaders are still failing to grasp. The new world Vermonters live in needs a renewed focus on economic prosperity, he says. In his return to Vermont, Lisman aims to give his home state a nudge in the right direction.

After he left Bear Stearns, Lisman became head of global equities at J.P. Morgan before retiring in 2009 and coming back to Vermont full time. Lisman felt the need to reconnect with the state, so he spent 18 months touring Vermont, going to people’s homes and talking to them about the issues they found important.

“I had a set of rules. One is, I had a map and I’d mark every road I went on, but more importantly I’d visit people I didn’t know,” he said. At the end of each meeting, Lisman says he asked his hosts who else would be interesting to talk with. “So I met with businesspeople, small entrepreneurs, doctors, lawyers, college presidents, people who ran restaurants, you name it. In all maybe 400 people in a period of 18 months.”

On his marathon meet and greet, Lisman came across Tom Pelham, retired deputy secretary of administration under Republican Gov. Jim Douglas and head of the Department of Finance and Management for Democrat Gov. Howard Dean. Campaign for Vermont, Lisman says, was born out of his first meeting with Pelham.

“He gave me a tour of his house and only when we were sitting staring at each other across the living room did he say ‘So what do you want?’ and I gave him my ideas and we shook hands and he became my first partner in Campaign for Vermont,” Lisman said.

The group is based on Lisman’s premise that the world has changed, and its leaders haven’t caught up.

“I thought, around us Washington wasn’t getting it,” Lisman said. “I mean after the crisis, they weren’t figuring out that something had changed, Europe certainly still hasn’t gotten it … and I didn’t think many of the states were getting it. Our state in particular wasn’t getting it. They were marching to the same tune they had been. Maybe that’s right, but I thought we oughta find out if it’s right.”

Campaign for Vermont was incorporated Sept. 22, 2011, with Lisman, Pelham and Mary Alice McKenzie, both prominent conservatives, listed as officers.

With over $200,000 in expenditures by April 25, some wonder how far Lisman will reach into his deep pockets to fund the campaign.

Eric Davis, professor emeritus of political science at Middlebury College, says that based on how much he has spent so far, Lisman is on course to spend $1 million by the time elections roll around in November.

Davis says he thinks that as much as Lisman preaches non-partisanship, Campaign for Vermont aligns with the right.

“I would say that while Campaign for Vermont is not formally or organizationally affiliated with the Republican Party, but in terms of the issues,” the two groups see eye to eye.

“[Lisman] would like to see Randy Brock elected for governor, but he cannot say in his commercials ‘vote for Brock’ or ‘vote against Shumlin,’” because such an ad would trigger campaign finance laws.

With the session over and Campaign for Vermont’s three to six ads per month seeming to slow down, the group’s future seems unclear, even to Lisman.

“I’ll be interested to see whether the group continues in the 2014 election cycle,” Davis says, “if Shumlin is re-elected and the Democrats still have a majority.”

Lisman says he put more money into Campaign for Vermont initially to gain recognition and make the group known, but making predictions based on those numbers would be a mistake.

“I understand limitations, but remember we had to start bigger. I’m not sure you should extrapolate those kind of numbers anyway,” he said.

One thing Lisman seems sure of is that Campaign for Vermont is here to stay.

“We started last Thanksgiving,” he said. “We’re still here, and I anticipate this Thanksgiving we’ll still be here and the Thanksgiving after that, I think we’ll still be here. How we fund it or how we shape ourselves is largely a function of how we do, how successful we are. We could finish tomorrow if everybody agreed our themes are the themes to grab onto for the betterment of our citizens and considering the world around us.”

Lisman says he doesn’t see that happening, so he plans on sticking with Campaign for Vermont. Funding is a different question, one he admittedly has no answer for.

“How we do it from here I’m not prepared to say and I’m not sure I know, but we’ll still be here,” Lisman said.

Though those words were about Campaign for Vermont, they may resonate with many of the group’s critics who say Lisman has pointed to a lot of problems without naming solutions. Lisman says such criticism plays a vital role in democracy.

“My heroes on a personal level,” Lisman said, “would be people who see something wrong and either raise their hand or say something. The first line of defense in a democracy are people – whether they’re sane or not – who’ll see something that’s wrong and do something about it. Unlike other places where things are grand injustices and no one is brave enough to stand up.”

Campaign for Vermont is not necessarily saying the state is approaching these issues the wrong way, Lisman says, just that citizens and lawmakers alike should be aware of the costs and successes of all programs, and keep a critical eye out for failures.

“We should at least start by saying ‘This doesn’t look right.’ This may ultimately be the best we’ve got, but let’s have a robust debate about it,” Lisman said.

The ultimate goal, Lisman says, is to get people talking about Campaign for Vermont’s central issues, all of which revolve around the state’s prosperity.

“If there were a robust two-party system, I guess, they might have this debate and we wouldn’t do this,” Lisman said. “But there’s no debate on big issues.”

Editor’s Note: Campaign for Vermont co-founder Tom Pelham wrote an op-ed in response to this article, published here.