Rulings Cover Political Donors In Veil Of Secrecy

A growing number of independent groups are spending money to promote or attack candidates this midterm election season. It's a result of rulings by the courts and the Federal Election Commission -- rulings that, taken together, allow corporations to funnel money into electoral politics anonymously.

The second of two reports

In the first 17 days of August -- not normally a time of major campaign activity -- independent groups spent $2.4 million to promote or attack candidates in the midterm elections. The spenders included unions and well-established advocacy organizations.

But the numbers of smaller independent groups are growing. It's a result of rulings by the Supreme Court, a federal appeals court and the Federal Election Commission -- rulings that, taken together, allow corporations to funnel money into electoral politics while remaining anonymous.

Evan Tracey, president of the Campaign Media Analysis Group, which tracks political advertising, said Tuesday that groups with new ads going up included Americans for Prosperity, the Committee for Truth in Politics, the League of American Voters, the Small Business Action Committee and the Emergency Committee for Israel -- "and that's just in the last 12 hours."

Regional comparisons to 2006 -- when Democrats were pressing beleaguered Republicans in the last midterm elections -- show spending is already up about 50 percent in some cases, Tracey says.

The New Rules

Helping to drive that surge is the Supreme Court's Citizens United decision -- the invitation for corporations to take sides in elections. After that, two lesser-known decisions opened the door wider.

A federal appeals court said people can give as much as they want to groups that advertise for or against a candidate. The so-called "independent expenditure committees" just can't coordinate with the candidate or party.

And finally, the Federal Election Commission rolled those two rulings together and came up with this: These independent expenditure committees can take unlimited contributions from individuals, unions and corporations.

And because of a loophole in the FEC rules, they don't have to report it.

"Unless the donor is giving for that specific ad, the donor will not have to be disclosed," says Larry Noble, a campaign finance lawyer in Washington who formerly served as general counsel to the FEC. "So, effectively, these corporations that don't want to be seen as supporting candidates can now give the same money they would've spent on their own to another organization, to spend that money."

Who's Behind The Ads?

Take, for example, the Coalition to Protect Seniors, which has been attacking Senate Majority Leader Harry Reid in Nevada. "Democratic senators and congressmen, like Harry Reid and Nancy Pelosi, voted for the new bill, which will cut $455 billion from Medicare," says one ad that's filled with pictures of forlorn senior citizens.

The coalition's ads mention several health care companies by name. But three of them said the ads aren't theirs. So did their trade association, America's Health Insurance Plans.

The coalition is not registered with the FEC or as a nonprofit with the IRS. Its website doesn't list a phone number or address, and nobody at its e-mail address replied to NPR this week or last.

A Dissent

The FEC created this veil of secrecy in a 5-1 vote. The dissenter was one of the commission's Democrats, Steven Walther. He argued that the commission's rule-making brushed aside important federal laws on contribution limits and disclosure.

"Those statutes are still on the books. They've not been overruled. They're still there," he says.

It's possible that the FEC will make the independent expenditure committees reveal their donors in a later rule-making process.

But until that happens, limits are out and veils are in.

On Monday's All Things Considered, NPR's Peter Overby took a look at how backlash against Target Corp. over a political donation may lead other companies to cover their tracks.

Copyright 2010 National Public Radio. To see more, visit http://www.npr.org/.

More in U.S. / World

Comments

blog comments powered by Disqus