Handpicked Republican establishment candidate Dino Rossi was Washington state’s first Senate candidate to sign onto the right wing “Contract From America.” Dino has already been questioned on some of the Contract’s more damaging provisions, such as a flat tax or a fair national sales tax. But the Contract has more than just damaging provisions – it has a long list of founding partners with close connections to Rossi whose ideas and principles are dangerous for middle class families in Washington state.

One of the primary founders of the Contract is FreedomWorks. On July 22, FreedomWorks PAC endorsed Rossi. National tea party hero, Dick Armey, chairs FreedomWorks, and former Armey staffer Pat Shortridge is Dino Rossi’s campaign manager. Recently, on August 27, Rossi was honored at a FreedomWorks rally as a a“Champion of Freedom,” and he appeared on stage via video along with Michele Bachmann, Marco Rubio and Rand Paul.

“Dino Rossi is closely tied to the FreedomWorks organization,” said Sadie Weiner, Communications Director for the Washington State Democrats. “With Dick Armey pulling the strings at FreedomWorks and former Armey staff pulling the strings at Rossi headquarters, the connection is clear. Dick Armey and FreedomWorks whispered their plan for a national flat income tax or Fair Tax into Dino’s ear, and then Dino signed the Contract that would mean disastrously higher taxes for Washington state’s middle class families who are already struggling to make ends meet.”

FreedomWorks and Dick Armey: Extreme on the Flat Tax

Freedom Works Plans to Battle With Labor Unions, Consumer Advocacy and Environmental Groups. According to the Dick Armey, co-chair of Freedom Works, his organization is trying to “build a powerful conservative force ‘that can go toe-to-toe against the labor unions, liberal consumer groups and radical environmentalists.’” Armey wants to introduce “a flat-tax plan to replace the current federal tax code.” [AP, 11/20/03]

Dick Armey, Co-Chair of Freedom Works, Advocates Flat Tax and Denounces European System. Freedom Works co-chairman, Dick Armey, advocates flat tax reforms for the U.S. social security program. According to accounting today, “he would start by scrapping the current code” and “All income – business and individual – would be taxed only once and at one rate.” Armey also cautioned that the system might become “European.” [Accounting Today, 06/20/05]

FreedomWorks Funded and Bolstered by a Scam

Washington Post: Insurance Money Promised Membership to FreedomWorks. In 2006, the Washington Post reported that a prominent Republican businessman arranged an agreement with FreedomWorks that has netted the organization hundreds of thousands of dollars and thousands of new members. According to documents provided during a class action suit, J. Patrick Rooney, president of Medical Savings Insurance Company, proposed the deal to FreedomWorks, then-called Citizens for a Sound Economy, in 2000. Under the agreement, a broker for Medical Savings Insurance would sell high-deducible insurance polices and tax-free savings plans at a group discount for buyers who joined FreedomWorks. FreedomWorks has earned more than $638,000 and 16,000 new members from the deal. [Washington Post, 7/23/06]

–Critics Said Deal Was a Way For FreedomWorks to “Inflate Their Membership Rosters—And Their Bottom Lines.” The Washington Post reported that critics saw the deal between FreedomWorks and the insurance company as “a way for political groups to inflate their membership rosters—and their bottom lines by taking dues from people with no interest in the group’s polices.” Louis Silber, a lawyer involved with the Florida class action suit said, “We have clearly concluded these folks had no idea what Citizens for a Sound Economy was. They had no idea where their money was going.” [Washington Post, 7/23/06]

–FreedomWorks Altered Its Charter to Allow for Medical Savings Insurance Deal. Court documents involving the deal between Medical Savings Insurance Company and FreedomWorks revealed that initially, the deal would not be legitimate because FreedomWorks’ charter would not allow members. A September 2000 correspondence between Medical Savings President Randal Shuttles to Rooney said that the deal would not go through because FreedomWorks’, then called Citizens for a Sound Economy; charter stated “the corporation shall not have members.” Fifteen days later, Shuttles was told FreedomWorks solved the problem by amending its charger to allow for voting members. [Washington Post, 7/23/06]

–Buyers Were Unaware of FreedomWorks’ Affiliation with Insurance Company, Did Not Know They Were Now Members of FreedomWorks. Jeffery Liggio, a lead lawyer in the lawsuit against Rooney, told the Washington Post that the insurance policies themselves never mentioned FreedomWorks. The suit’s motion for class action status stated, “The certificates of insurance issued to class members, despite the clear language contained therein, did not disclose the identity of the Group Policyholder of the group policy, despite the fact that each putative insured must ‘join’ and pay money to such group as a condition of obtaining the insurance.” [Washington Post, 7/23/06]

Dick Armey: Extreme on Medicare
In July 1995, Armey described Medicare as “a program that I would have no part of in a free world.” (The Washington Post, “Scare Politics of Medicare,” July 26, 1995)

FreedomWorks and Dick Armey: Extreme on Social Security

Freedom Works Believed it Would be Irresponsible to Not Cut Social Security Benefits. According to Cesar Conda, a senior fellow at Freedom Works, “progressive indexing or increasing the retirement age – must be considered” when reforming social security.” This would reduce the benefits received for taxpaying America citizens. Conda continued, “Failure to do so would be irresponsible in the extreme.” [National Review, 6/2/05]

In a September 1984 meeting with the editorial board of the Fort Worth Star-Telegram, Armey was heavily critical of social security. According to a March 2002 column by Jack Z. Smith of the Fort Worth Star-Telegram:

“In a Sept. 6, 1984, meeting with the Star-Telegram Editorial Board, Armey labeled Social Security ‘a bad retirement program’ and a ‘rotten trick’ on the American people. ‘I think we’re going to have to bite the bullet on Social Security and phase it out over a period of time,’ he said. Armey said young people could find better ways to secure their retirement, such as putting money into individual retirement accounts.” (Fort Worth Star-Telegram, “Dick Armey, Guardian of Social Security?” March 9, 2002)

9/08/10