The unlimited donations to and spending by Super PACs and non-profit “social welfare” groups [aka 501(c)(4)s] allowed by the Supreme Court’s 2010 Citizens United and other decisions have changed the whole pattern of funding for our presidential campaigns.
These supposedly independent, “outside” entities are the dominant players in this election. Every one of the major presidential candidates except Bernie Sanders has one or more of these unconstrained groups advocating for his or her election. One study found that more than 80% of the advertising in the Republican presidential primary race was paid for by outside entities – not by the candidates’ own campaign committees. [1] Campaign funding from Super PACs and 501(c)(4)s is rapidly trickling down to US Senate and House races, to state-level elections, and even to Mayoral elections.
As of February, $607 million has been given to Super PACs. Of that huge sum, $248 million (41%) has come from just 50 mega-donors, their families, and their privately held companies. This is more money than the $161 million donated by the 1 million contributors to Hillary Clinton’s campaign committee. While donations to Super PACs and 501(c)(4) non-profit groups are unlimited in amount and source, donations to candidates’ campaign committees are limited to $2,700 per election and corporate money is prohibited. [2]
The Supreme Court justified its Citizens United decision by asserting that the unlimited spending of these outside groups would be independent of candidates’ campaigns and that donors and spending would be disclosed so that voters would know who was trying to affect their votes. As Justice Anthony M. Kennedy wrote for the majority in Citizens United: “By definition, an independent expenditure is political speech presented to the electorate that is not in coordination with a candidate.” Because the expenditures are independent, Kennedy concluded, they “do not give rise to corruption or the appearance of corruption.” [3]
These justifications for allowing unlimited spending have now been shown by reality to be wrong. Meaningful disclosure is not occurring. Super PACs’ disclosures of donors are infrequent and often not timely in terms of when an election is occurring. Furthermore, large donors have engaged in money laundering to hide the true source of their donations. They donate via a corporation or other entity that does not disclose its sources of funding and sometimes is set up for the express purpose of funneling political contributions and then disbanded once the election is over. The non-profit 501(c)(4) organizations do not have to disclose donors and hence are referred to as “dark money” groups. Money is often shuffled among these groups to hide its true source.
It is becoming increasingly well documented – although it has been suspected from the beginning – that many Super PACs and 501(c)(4) groups do NOT operate independently of the candidates and their campaign committees. Over 100 of the Super PACs, including many of the biggest ones, are single candidate Super PACs. This means they are raising and spending money on behalf of one and only one candidate. Roughly 80% of the money raised by Super PACs in this election cycle has gone to single candidate Super PACs. These Super PACs are effectively shadow campaigns. They run ads, stage events, sell candidate-branded merchandise, and even handle press inquiries. They are often run by close aides (or former aides) of the candidate.
In many cases, the candidate attends the fundraisers for the Super PAC and in some cases, the candidate launches the Super PAC and directly helps it raise money before officially becoming a candidate. Jeb Bush, former Governor of FL and Republican presidential candidate in 2016, did this with his Right to Rise Super PAC. It raised more than $100 million that was used to support his presidential campaign once he became an official candidate. [4]
One of the most blatant and well-documented cases of coordination between a candidate and outside groups is that of Wisconsin Governor Scott Walker and two non-profit, 501(c)(4) groups: the Wisconsin Club for Growth and the Wisconsin Manufacturers and Commerce group. [5] I’ll describe this example of coordination in my next post.
[1] Carney, E.N., 12/17/15, “Democracy prospect: Omnibus battles spotlight political money fault lines,” The American Prospect (http://prospect.org/article/democracy-prospect-omnibus-battles-spotlight-political-money-fault-lines)
[2] Gold, M., & Narayanswamy, A., 4/17/16, “41% of Super PAC money coming from 50 donors,” The Boston Globe
[3] Carney, E.N., 12/10/15, “Super PAC debate spotlights illegal coordination,” The American Prospect (http://prospect.org/article/super-pac-debate-spotlights-illegal-coordination)
[4] Carney, E.N., 12/10/15, see above
[5] Fischer, B., 5/19/16, “Will SCOTUS confront the results of Citizens United,” Moyers & Company (http://billmoyers.com/story/confronting-citizens-united/)
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