I decided on the title of this piece before I had much of a clue how to actually write it.
What the hell was I thinking?
Even a cursory discussion of this topic could easily require several books. Several intensely boring books. I had writer’s remorse about even “going there” given that (a) I’m by no means an expert in this ridiculously complex arena and (b) the topic makes dishwater seem considerably less dull. However, since a lack of expertise has never discouraged me from conveying a strong, laborious opinion, I thought I’d weigh in. The topic is important. Tedious, but important.
Please bear with me. I promise I’ll eventually make an interesting point or two. Scratch that. I promise I’ll make a point. As initial context, though, I do need to lay out a vast over-simplification of just a few of the political organizations that currently participate in American elections:
- A Campaign Committee is obviously the central organization dedicated to the election of a specific political candidate. It is highly regulated by the Federal Election Commission (FEC). An individual may give up to $2,700 per election to campaign committees. All donors and expenditures must be publicly disclosed.
- A Party Committee is dedicated to electing multiple candidates at the national, state, and local levels. An individual may give up to $33,900 per year to a national party committees and a total of $10,000 per year to state/local party committees. A party committee may contribute up to $2,700 per election to campaign committees. All donors and expenditures must be publicly disclosed.
- A PAC is a “Political Action Committee” formed to collect money to contribute to other committees. A PAC is generally formed by a corporation, union, or ideological group with the intent of influencing one or more elections. An individual may give up to $5,000 annually to a PAC. A PAC may contribute up to $5,000 to one or more campaign committees per election. It can also annually contribute up to $15,000 to national party committees, a total of $5,000 to state/local party committees, and $5,000 each to other PACs. All donors and expenditures must be publicly disclosed.
- A Super PAC is an “independent expenditure-only” committee that can advocate for the election or defeat of a candidate or party. A Super PAC can’t contribute to nor directly coordinate with any candidate or party committees but it can spend an unlimited amount independent of those two entities. Coordination through the media, however, isn’t illegal – which is as big a loophole as you think it is. There are no limits on contributions to a Super PAC. All donors and expenditures must be publicly disclosed.
- A 527 organization is an “issue advocacy” group that can’t expressly advocate for the election or defeat of a candidate or party. Instead, it is supposed to focus solely on an “issue” – which is as vague a restriction as you think it is. It can’t coordinate with any candidate or party committees but it can spend an unlimited amount advocating for its issue. There are no limits on contributions to a 527. All donors and expenditures must be publicly disclosed.
- A 501(c)(4) organization is a “social welfare” group that isn’t supposed to have politics as its “primary” purpose – which is as unenforceable a restriction as you think it is. It can’t directly contribute to candidate or party committees. However, since it can spend unlimited amounts of money elsewhere to freely seek legislation “germane” to its purpose, it can essentially do whatever else it wants. There are no limits on contributions to a 501(c)(4). Donors do not need to be disclosed. Hence, money from these groups is often called “dark money”. Foreign donations are allowed but are only supposed to be used for “educational” purposes – which is almost funny. Expenditures that explicitly advocate for or against a candidate are supposed to be disclosed; otherwise, there are no expenditure disclosure requirements.
Even the brief bullet descriptions are daunting and these are just the major “legal” groups. There are also 501(c)(3) “charities” that aren’t supposed to be political, but are. There are also LLCs which aren’t supposed to be used to obscure individual political donations, but are. The bottom line is that the political money landscape is massively complicated and the fact that many of these groups can donate to each other makes things almost humorously meaningless.
Gaming the system is just way too easy.
As a simple example, a single group could create a 501(c)(4), a 527, and a Super PAC. Via its 501(c)(4), the group could collect as much money as it wanted from anywhere it wanted without disclosing its donors. It could then donate half of the proceeds to its 527 to advance a specific cause and half to its Super PAC to impact specific elections. Each of the latter two organizations would have to report a donation, but only as an unattributed bulk sum from the 501(c)(4). Thus, the group could quite easily and quite legally drop unlimited amounts of untraceable money to sway any election.
Unfortunately, this is by no means an academic exercise. As just one real-world example, the NRA itself is technically a 501(c)(4). It also runs both a 527 (Political Victory Fund) and a PAC (Institute for Legislative Action) and it has a well-known relationship with Karl Rove’s Super PAC (American Crossroads). Bingo!
To put some of this into practical perspective, USA Today published a partial breakdown of political televisions spots that aired from January 1 through July 8 focused on the 2018 House and Senate races. With some rounding, 386,000 television spots were aired; 107,000 were run by outside groups; 47,000 were funded by dark money groups.
Thus, over a quarter of all ads came from non-campaign groups and almost half of those were untraceable to the individuals or corporations that sponsored them.
Factoring in the fact that dark money gets focused on the most contested elections, the numbers get even worse. In Missouri’s Senate race, 42% of ads came from dark money groups; in Wisconsin’s Senate race, 46% of ads came from dark money groups. I’m frankly surprised that the numbers weren’t higher and I fully expect that they will be as we get closer to the November elections.
In any case, I think I promised to make a point or two about money in politics. If anyone’s still reading, here they are:
First is a point about usage.
Both conservative and liberal groups have taken advantage of the existing laws. Democrats just suck at it. While dark money comes from across the political spectrum, conservative-leaning groups account for four out of the five largest dark money advertisers. In addition, many Democrats have been refusing to accept corporate PAC money while their Republican counterparts willingly accept it. Okay. I understand the “high road” concept. I really do. But it makes no sense to conduct a political campaign in some alternate universe where things are as you wish they were. Here’s an novel idea: Perhaps Democrats could win some elections and change the damn laws! In the meantime, they should consider running in the same elections as their opponents.
Second is a point about how the laws could possibly be changed. It seems to me that we’re making this a whole lot harder than it needs to be.
I propose that we eliminate all caps on all political donations from any American entity that wants to donate – people, corporations, unions, churches, trade groups, interest groups, pets, whatever. There are actually some valid First Amendment issues related to campaign contributions in addition to the impossible enforcement issues associated with the current set of rules. So just open the floodgates. There would be no meaningless distinction between issue advocacy and candidate advocacy. There would be no unenforceable restrictions on coordinated communications. Donate at will. Work with whomever you want.
Here’s the catch: Any and all donations to advocate for or against a political candidate or issue must be ultimately traceable to a specific non-tax-exempt individual or corporate donor. Period.
Yes, there are some potential negatives.
Sure, elections could be explicitly bought. But, gee, elections can be pretty easily bought today. An uncapped full-disclosure approach would at least let us know who’s making the purchase and would perhaps empower others to make counter bids.
Sure, publicly recorded political donations could be used to discriminate or alienate. Well, tough. Taking a stance is a necessary requirement of participation in a democracy. If an individual or corporation is unwilling to stand by their convictions, they don’t have to donate.
Something has to change. We’ve proven that constant tweaks and reinterpretations of the existing laws by the FEC, the IRS, Congress, and the courts isn’t helping. A radical idea seems appropriate and a past Supreme Court Justice was right:
Sunlight is said to be the best of disinfectants.
– Louis Brandeis, December 1913
Republicans should be happy with the reduced regulations. Democrats should be happy with the increased transparency. The relevant Supreme Court rulings imply that disclosure rules are fair game; only limitations on donations have been successfully challenged in court.
Simpler is better. And it can’t be a whole lot worse than what we have now.