Spending machine

Dark Money: Still a Republican Game

by Peter Olsen-Phillips

Massive checks from billionaires like Tom Steyer, Michael Bloomberg and James Simons have fueled a Democratic outside spending machine that has helped to keep vulnerable candidates in contention across the country. Third-party spending on behalf of Democrats has kept pace with conservative dollars by and large, but Republicans still dominate at least one facet of the outside money equation: A Sunlight analysis of dark money — from politically active groups that don’t disclose their donors — finds that the practice still has a decidedly Republican bent.

Longstanding organizations like the National Rifle Association and newcomers like the Kentucky Opportunity Coalition have opened their coffers to intervene in elections; sometimes in contests across the country, sometimes in a single race. Overall, Republican-leaning dark money groups have spent $94.6 million, while Democratic-leaning groups have spent $28.4 million. Some $1.9 million in expenditures could not be classified.

The most prolific of the spenders, by our tally, is the US Chamber of Commerce. A trade association and perennial heavyweight on K Street and the campaign trail, almost all of the Chamber’s $31 million in reported spending has supported Republicans or opposed Democrats.

Just behind the Chamber is Crossroads GPS, which has poured in $23 million to softening vulnerable Democratic candidates, $8.6 million of which has been poured into the nail-biter Colorado Senate race. Crossroads GPS is part of the network of organizations that Republican insiders Karl Rove and Ed Gillespie, currently the Republican nominee for Senate in Virginia, founded in the wake of the Supreme Court’s Citizens United decision in 2010.

While Crossroads GPS has an affiliated super PAC that discloses its donors (American Crossroads), the nonprofit arm has fought to keep its donor list quiet. It won an important victory in December of last year when FEC commissioners deadlocked on a decision to investigate the group’s political activity.

As the Center for Public Integrity and others have noted, Democrats are not bystanders in the dark money game. The League of Conservation Voters reported some $9.5 million in independent expenditures this year — good for the highest total of any liberal group — while the union-backed Patriot Majority USA has spent around $8.5 million.

Regardless of which side of the aisle it comes from, the stream of anonymous money is generally flowing toward a handful of tight Senate elections — particularly Alaska, Arkansas, Colorado, Iowa and North Carolina.

Nonprofit dark money operations generally are 501(c)4 social welfare organizations or 501(c)6 trade associations. Internal Revenue Service rules bar social welfare organizations from being organized primarily to influence electoral politics, though they may still legally spend millions of dollars directly advocating for or against federal candidates in the form of independent expenditures.

When they spend money advocating for or against a federal candidate, these organizations must file a disclosure with the FEC, with some summary information including the type of expenditure (often TV ads), how much was spent and which candidate is targeted. Unfortunately, we know these reports cover only a fraction of the total sum these groups are pumping in to elections.

As Sunlight has reported in the past, politically active nonprofits frequently run “issue advertisements” that skirt the FEC’s definition of express advocacy and go unreported to the FEC.

This covert spending comes to light in the days immediately preceding an election, however, which is partly why we see the large jump in September, as non-filers switch over to directly advocating for candidates — since they will have to report their spending regardless.

The Sunlight Foundation advocates for the DISCLOSE Act which would provide greater transparency of the donors behind nonprofits’ political money.