According to Democracy 21 President Fred Wertheimer:
The Times column points out that the amount of secret contributions being spent in federal elections by tax-exempt groups has dramatically increased in recent years to more than $300 million in the 2012 races. The public overwhelming supports disclosure of campaign money and the Supreme Court overwhelmingly supports the constitutionality of such disclosure. The DISCLOSE Act would close the gaping campaign finance disclosure loopholes for tax exempt groups and should be enacted promptly and not be stonewalled by congressional Republicans.
The New York Times
By: Thomas Edsall
JULY 22, 2014
It used to be that the Democratic Party, the party of the little guy, was the party of big money. Up until 2004, the party was dependent on so called soft money – contributions of as much as $10 million from corporations, unions and individuals that were beyond the reach of federal regulation.
Conversely, the Republican Party, the voice of Wall Street and corporate America, surpassed the Democrats in attracting small donations. The party pieced together direct mail lists of tens of thousands of men and women who were willing to contribute $5 to $25 a month, often motivated by the social and cultural issues of the 1960s and 70s.
Figure 1, taken from the OpenSecrets.org, clearly demonstrates the Republican advantage prior to 2004 in raising funds in small and medium-sized donations known as “hard money.” The chart shows that from 1987 to 2002, the Republican National, Senatorial and Congressional Campaign Committees decisively outraised their Democratic counterparts in relatively small federally regulated hard money contributions, often by a 2 to 1 margin.
During those years, to lessen the Republican advantage, Democrats turned to raising millions of dollars through large soft money donations. From 1992 to 2002, Democrats raised a total of $706.3 million from soft money donors, 87 percent of the $815.2 billion raised by the Republican Party that way.
In the middle of the last decade, this pattern began to change. Democrats discovered that liberal animosity to George W. Bush and the Iraq War, followed by the nomination of Barack Obama, produced a groundswell of supporters willing to commit to small, regular internet-enabled credit-card payments to the national party committees.
Republican small donors, in turn, appeared to become increasingly disenchanted with a party that delivered only modest results in the culture wars. This is the party, after all, that nominated John McCain in 2008 and Mitt Romney in 2012, neither of whom made the hearts of social conservatives leap.
In financial terms, the Republican Party and its candidates are now more in line with their ties to corporate America and the rich. They have turned increasingly to large contributors — donors who make gigantic donations to “super PACs” and “social welfare” organizations that claim tax exempt status under the 501(c)4 provisions of the Internal Revenue Code. So far, 501(c)4 committees have successfully avoided publicly identifying their donors.
No matter how used to all this we’ve all become, the numbers are striking. The amount of money flowing into federal campaigns — for Congress and the presidency — has been growing rapidly, doubling from $3.1 billion in 2000 to $6.3 billion in 2012. While overall spending increased by more than 100 percent from 2000 to 2012, spending by secretive political nonprofits, which do not disclose donors, has exploded 13-fold, from $24.9 million in 2000 to $335.7 million in 2012.
Four out of every five dollars, or $269.5 million, raised by tax-exempt groups, most of which claim to be “social welfare organizations,” go to pro-Republican and conservative groups. These political nonprofits have become a key source of indirect support for Republican candidates. As Figure 2shows, spending by conservative nonprofits has grown from $2.5 million in 2000 to $269.5 million in 2012. Liberal nonprofit spending has gone from $21.9 million in 2000 to $58.5 million in 2012.
The Democrats’ advantage with small donors is most apparent inpresidential elections. In 2012, Obama raised $232.2 million from contributors of $200 or less, nearly three times the $79.8 million in small contributions made to Mitt Romney.
While far outpacing Romney among small donors, Obama also crushed Romney in the competition for larger donors of $200 to $5,000, $489.7 million to $366.3 million, according to the Center for Responsive Politics, which produces OpenSecrets.org. Contributions of $200 to $5,000 may seem modest in comparison to the multi-million dollar contributions to super PACs, but the men and women who give $200 to $5000 are much wealthier than average Americans: A 2004 survey among donors of $200 or more, 35 percent had incomes in excess of $250,000, compared to just 2 percent of the entire population.
Overall, the Obama campaign spent $683.6 million in 2012, $250.3 million more than the Romney campaign’s $433.3 million.
Romney was able to keep pace with Obama only by raking in $418.6 million in support from super PACs and independent committees, $287.3 million more than Obama’s super PACs and independent committee support of $131.3 million, as shown in Figure 3. Restore Our Future, a super PAC, spent$142.1 million in support of Romney. It received contributions of $30 million from Sheldon Adelson, an international casino operator, and his wife, Miriam, and $9 million from Bob Perry, a Houston developer. Obama’s main super PAC, Priorities USA, raised $65.2 million, with the largest contributions, $2 million each, from Irwin Jacobs, former chairman of Qualcomm; James Simons, of Renaissance Technologies; Jeffrey Katzenberg, of DreamWorks Animation SKG; and Fred Eychaner, of the Newsweb Corporation.
When all the money is added up, including support from the national parties, a total of $1.1 billion was spent on behalf of Obama and $1.2 billion on behalf of Romney.
Just as the Republican Party and Republican candidates moved from reliance on small-to-medium publicly reported donations to large, often undisclosed, contributions, the party’s platform position on campaign finance law began to change.
Not only did the Republican Party itself shift, but the Republican appointees to the Supreme Court are now unanimously opposed to constraints on large donors, as seen most recently in the April decision in McCutcheon v. Federal Election Commission and before that in 2010’s Citizens United v. FEC.
The Republican Party and the Republican justices have, in turn, been joinedby the three Republican appointees to the Federal Election Commission who have used their power to block the F.E.C. from issuing rulings that would require disclosure of donors to 501c “social welfare” organizations.
In effect, the Republican Party establishment has adopted positions designed to enable and legitimize the growing dependence of its candidates and party organizations on large corporate and individual donors.
Just a decade ago, the Republican Party was a strong proponent of full disclosure of the sources of campaign money.
The 2004 Republican Party platform proudly declared that “Republicans have enhanced financial disclosure requirements for political campaigns, corporations, and pension funds in order to bring about more transparency and accountability in the political system.” Four years earlier, in 2000, the platform endorsed “full and timely disclosure on the Internet of all campaign contributions — so the media and the public can immediately know who is giving how much to whom.”
In 1996, when Bill Clinton was running for a second term, the Republican platform decisively supported “requiring full and immediate disclosure of all contributions, and cracking down on the indirect support, or ‘soft money,’ by which special interest groups underwrite their favored candidates.”
By 2012, the Republican Party had completed an about face. In a section of that year’s platform titled “The First Amendment: Speech that is Protected,” Republicans firmly backed “the free speech right to devote one’s resources to whatever cause one supports.” There is no mention of voting rights or ballot access in this section; the entire focus is on “resources” — money.
Declaring their opposition to “any restrictions or conditions that would discourage Americans from exercising their constitutional right” to use their “resources” to promote their political views, the Republican National Committee declared its “support of repeal of the remaining sections ofMcCain-Feingold” and pledged to “support either raising or repealing contributions limits, and oppose passage of the DISCLOSE Act.”
The currently pending DISCLOSE Act, sponsored by Democrats, would require any tax-exempt group that spends more than $10,000 in a federal election to publicly identify all donors of $10,000 or more. Spending by these political nonprofits, most of which operate as 501c4 committees, ballooned from a barely noticeable $16.9 million in 2006 to $335.7 million in 2012.
James Bopp, a lawyer who has successfully litigated many of the cases dismantling campaign finance law, said in a lengthy phone interview that in recent years “the party has become more conservative and among conservatives, the First Amendment has a principal place and as a result conservatives are against campaign finance regulations.”
Liberals, Bopp argued, try to manipulate campaign finance legislation to the advantage of the left, while conservatives act on “principled convictions.”
Maybe, maybe not.
A simpler explanation is that the Republican Party elite has adopted a new set of principles in order to justify and support the changing financial needs of the Republican Party.
Polling shows consistently high levels of public support for restrictions on campaign contributions, based on the widespread belief that the system of paying for political campaigns is corrupt. Eight out of ten voters oppose corporate involvement in politics. Despite these views, campaign finance reform has failed to become a mobilizing issue.
One alternative to the existing system is public financing, which is, however, fraught with problems: What regulations would govern qualification for public subsidies? Would there be limits encouraging some candidates to opt out in favor of private financing? How would primaries be paid for? Would the system strengthen or weaken potential third party candidacies? In June 2013, Gallup found that a slim majority of the public, 50-44, supported public financing, but when the issue was put in the context of “using taxpayer dollars to pay for political campaigns,” support dropped radically.
A 2013 Sunlight Foundation study by Lee Drutman, a senior fellow, found that in the 2012 election, a tiny fraction of the American public, just 31,385 men and women making up 0.01 percent of the population, provided over a quarter of the $6 billion spent in federal campaigns that year.
This constituency is composed of publicly identified donors who made contributions to candidates and to political committees, including super PACS, ranging from $13,000 to $93 million (Sheldon and Miriam Adelson). 49.8 percent of these mega-donors gave at least 90 percent of their money to Republicans; 35.5 percent gave at least 90 percent of their contributions to Democrats. “A tiny sliver of Americans who can afford to give tens of thousands of dollars in a single election cycle,” Drutman wrote, “have become the gatekeepers of public office in America.”
One way or another, the inexorably rising costs of campaigns suggest that as long as this situation endures, neither the Democrats nor the Republicans will be the party – or represent the interests — of the little guy.