5:21AM EST November 29. 2012 - Rep. Connie Mack has about a month left in his Congressional tenure. But before he leaves, the Florida Republican has scheduled a vote Thursday in the lame-duck session on a bill that would benefit a New York mogul whose firm was one of the biggest financial supporters of Mack's failed Senate campaign and the re-election campaign of his wife, Rep. Mary Bono Mack.
The "Judgment Evading Foreign States Accountability Act" is a bill that Mack, chairman of a House Foreign Affairs subcommittee, has proposed to force Argentina to pay U.S. investors more than $3.5 billion worth of principal and interest. Argentina sold the bonds to raise capital and then defaulted on them in 2001. The bill bars defaulting nations from U.S. capital markets and requires the U.S. government to take default status into account when providing foreign aid. It would be the first bill the chairman has moved through the subcommittee this year.
A leading figure in the pursuit of payment from Argentina is New York venture capitalist Paul Singer (no relation to this reporter). Singer has battled in U.S. courts for years over the repayment of the debt, and court records show Argentina owes Singer's companies more than a billion dollars. He isn't the only one pursuing repayment by Argentina: Several large investors have formed a coalition called American Task Force Argentina seeking repayment of the debt.
President Obama earlier this year suspended trade preferences for Argentina over the bond dispute.
Last week, a federal judge in New York ordered Argentina to pay U.S. bondholders and scolded Argentine officials, including President Cristina Fernández de Kirchner, for repeatedly stating that they will not payoff the bonds and will not be bound by U.S. court rulings ordering the country to do so.
According to a briefing paper prepared by the subcommittee, Argentina defaulted on its debts in 2001 and in 2005 "unilaterally offered lenders approximately 27 cents on the dollar." Singer's initial filings with the New York court indicate that he bought significant chunks of the contested bonds several years later.
Singer is a major source of campaign financing for Republican candidates. Last year, he gave $1 million to Restore our Future, the super PAC supporting GOP presidential candidate Mitt Romney. He used another million dollars to create American Unity, a PAC that supported pro-gay Republicans.
American Unity paid for ads in support of eight congressional candidates for the 2012 election, including Mary Bono Mack, R-Calif. The PAC spent just over $423,000 on ads attacking Bono Mack's opponent, according to campaign-finance records compiled by the non-partisan Center for Responsive Politics.
Employees of Singer's investment firm, Elliott Management, also donated $39,000 to Connie Mack's Senate campaign, more than any other single company contributing to his campaign.
Singer and Elliott Management declined to comment for this story.
Mack's office brushed aside questions about the connection between the legislation and Singer's campaign support.
Kristin Jackson, the subcommittee staff director, said in an e-mail: "Congress has a fundamental responsibility to stand up for the interest of Americans everywhere. Let's be clear — U.S. courts have ruled numerous times, including last week, against Argentina. Yet Argentina's leaders continue to ignore our courts."
The bill Mack plans to mark up is unlikely to become law anytime soon. There is no plan to move it on the House floor or in the Senate, where a similar bill was introduced by Sen. Roger Wicker, R-Miss.
Wicker received just over $31,000 in campaign donations from employees of Elliott Management, making the firm one of the top five contributors to his successful re-election campaign. Wicker spokesman Rick Curtsinger said the senator had received requests from Mississippians to look into the issue of Argentine debt and believes the bill is important because "countries have to honor their commitments to international agreements."