POLITICO (Washington) -The convention is being held at a fancy resort, features $550 ticket prices, a steak and lobster dinner and a guest speaker with a $100,000 speaking fee. It’s sponsored by a for-profit company with a mysterious wealthy benefactor, and its organizers, who have been accused of secrecy and corruption, have threatened lawsuits against dissenters and clamped down on news coverage.
Sounds like just the kind of thing that tea party activists, whose populist outrage is directed at the Washington and Wall Street establishments, would be up in arms over.
Except it’s a tea party convention.
Billed as a pivot point to transition the tea party movement from a chaotic uprising to an organized and sustainable political force and featuring Sarah Palin as its star attraction, the first-ever convention in Nashville from February 6 to February 8 is instead shaping up as a reminder of the problems inherent in holding together a fractious coalition of local groups resistant to authority and pursuing often-conflicting agendas.
Red State blogger Erick Erickson made it clear recently what he thinks of the coming event — pronouncing that it “smells scammy” and is inconsistent with the grass-roots energy behind the tea party movement.
“I’m hoping for the best, but I’m prepared for the worst — that it descends into infighting and that the passionate activists who attend end up leaving disenchanted,” he told POLITICO.
At least two national groups that have emerged as major players in the movement rejected requests to buy sponsorships for the convention — which were going for as much $50,000 — while three other groups have recently withdrawn as sponsors, with two citing concerns over organizer infighting and questions about the convention’s unusual finances.
The tensions swirling around the convention are in many ways emblematic of the ones that have plagued the tea party movement as a whole since soon after disaffected conservatives — many new to politics and unversed in organizing — flocked to congressional town halls and marches across the country to protest the big-spending initiatives pushed by President Barack Obama and the Democratic Congress.
The national convention was envisioned as a way to move past the disputes by bringing together leading activists from across the country to share ideas, receive training and hear from tea party heroes such as Palin, the former Alaska governor, and Reps. Michele Bachmann (R-Minn.) and Marsha Blackburn (R-Tenn.).
But perhaps befitting the movement it is trying to bring together, the convention is — well, unconventional and a bit chaotic.
It was the brainchild of Judson Phillips, a Tennessee lawyer who — as first reported by POLITICO — is running the event through a for-profit Tennessee corporation he controls called Tea Party Nation. Most political conventions are conducted by nonprofits. Yet Phillips originally intended to turn a profit from the endeavor, with the cash going to fund a so-called 527 group that would air ads praising conservative candidates or criticizing their opponents.
But Phillips now concedes he didn’t fully grasp the complexities of pulling off the convention and is merely hoping to break even, despite recently selling out the last remaining tickets. In addition to 600 tickets at the $550 level, which will admit attendees to the convention and Palin’s speech, Tea Party Nation offered an additional 500 tickets to Palin’s keynote for $350 each.
“This is the first time we’ve done anything like this,” Phillips told POLITICO. For now, he said, his plans for a 527 group are off the table. “We’re not even done with the convention yet and there may not be any profits. We could still end up losing money on this convention.”
POLITICO has learned that Phillips obtained a $50,000 loan to pay a deposit toward the $100,000 fee Washington Speakers Bureau charged to secure Palin as the keynote speaker at the convention. Much of the loan came from Bill Hemrick, a baseball card tycoon whose loan contract didn’t call for interest but did set a deadline last week for repayment, which Phillips missed.
American Majority, a leading training outfit for tea party organizers, canceled two planned sessions at the convention and withdrew its sponsorship after learning about the convention’s for-profit structure and the criticisms of Phillips.
“Who is this guy? What are his motivations? And what gives him the credibility to try to step in and insert himself as a leader of the movement?” Ned Ryun, president of American Majority, said he started wondering of Phillips.
Another former sponsor, the American Liberty Alliance, cited as a red flag Tea Party Nation’s use of PayPal accounts linked to Phillips’ wife’s e-mail address to process ticket payments.
Phillips, a 50-year-old self-described “small-town lawyer,” got an early start in the tea party movement, helping to organize a February protest in Nashville and later establishing an online social network for activists. After incorporating Tea Party Nation, he pitched the idea for a national convention and set out in search of funding.
His search led him to Hemrick, a 69-year-old retiree who made a small fortune as one of the founders of The Upper Deck Company, which revolutionized the baseball card industry in the late 1980s with expensive hologram-stamped cards.
Hemrick had occasionally donated to conservative candidates and causes, but said “this is the first time that I’ve gotten actively involved in something trying to make a difference.” He wanted to bring Palin to Nashville to try to unite tea party activists “and get them going in one direction,” he explained.
But that wasn’t the impression Hemrick left with several tea party activists on a mid-November conference call, when in the midst of arguing how important money was to a successful convention and broader political movement, Hemrick mentioned that he intended to pitch Palin on a business venture he and some partners were developing.
“For all of us who were on this call, it was a news flash,” said Tami Kilmarx, who was active in Tea Party Nation and convention planning until a dispute over secrecy and control with Phillips and his wife and business partner, Sherry Phillips. “We realized (Hemrick) had his own designs, which are not in line with what this grassroots movement was all about.”
Hemrick said the venture, an automotive safety device he was seeking to get mandated by state or federal governments, is on hold for now and that his comment was being “blown out of proportion. I made a simple little statement that if I meet Sarah Palin, I’m going to talk to her about his thing we got. But now, that subject won’t be raised if I meet Sarah Palin.”
Erickson worries that by associating herself with Phillips and the convention, Palin “might be ruining herself unintentionally.”
She has already taken some heat for the $100,000 contract Tea Party Nation signed with Washington Speakers Bureau — which Hemrick said requires either first-class airfare or a private jet to fly her to the event.
After she was criticized for the fee, Palin told Fox News’ Bill O’Reilly that she “will not financially be gaining anything from this.” Instead, she suggested she would “turn it right back around and contribute to campaigns, candidates and issues.”
But the only way she could do that under federal election law would be to make maximum contributions of $2,400 to candidates, $5,000 to political action committees or $30,400 to national party committees (she could make larger contributions to independent 527 groups, but those are barred from directly supporting or opposing candidacies).
Ryun asserted that the newness of the tea party movement makes it a sort of Wild West where groups and individuals are vying for supremacy and said it’s incumbent on activists and leaders to raise red flags about activity they see as questionable.
“If this kind of stuff is not called out, eventually it will delegitimize the movement and we’re not going to let that happen,” Ryun said.
That’s why some activists are weighing the possibility of protesting outside the convention, said Anthony Shreeve of Dandridge, Tenn. Shreeve is a former Tea Party Nation member who resigned from the convention steering committee in a dispute with Phillips over finances. “It would really look bad for tea parties to be out there protesting the tea party,” said Shreeve.
Phillips declined to respond to the criticisms except to say, “the convention is not about me. It’s about the movement and it’s about the activists who are coming there to learn, network and be inspired.”
After a spate of critical blog posts fed by Shreeve and other disaffected former Tea Party Nation members, Phillips initially moved to close the convention to all media. After criticism, he opened it to a handful of outlets perceived to be friendly to the movement — including Fox News, The Wall Street Journal, Breitbart.com, Townhall.com and World Net Daily — and is said to be considering a video feed or pool arrangement to allow more media access.
His allies, meanwhile, are blasting back at critics, accusing them of jeopardizing the tea party movement by trying to sabotage the convention out of jealousy.
“If some of these people who are just staunchly against Judson make a play to derail that event, it could have a negative impact on the tea party movement as a whole,” asserted Jason Lukawitz, Hemrick’s partner in the automotive safety venture and in a soon-to-be-unveiled political action committee.
Phillips “really has pure motives. Maybe his execution hasn’t the best and I think he’s ruffled some feathers, but it’s inevitable that innovators are going to ruffle feathers.”