Super-PAC Dark Money More Dangerous Than Ever

Written by Common Cause Interns on June 28, 2013

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Written by Kevin Paulsen

On June 21, POLITICO reported on a survey of 151 corporate and trade association staffers which, according to the article, showed that "corporations are very hesitant to embrace super PACS." The survey found that "93% of corporations to do not have super PACs or other independent political efforts." Instead, POLITICO reported, "most companies would rather use standard PACs to give directly to candidates or committees." Such contributions are limited to $5,000 per candidate, per election cycle.

POLITICO's article, however, understates the role of corporate dollars in American elections post-Citizens United. Corporate contributions and expenditures did play a major role in the 2012 elections. According to a post-election report by Demos and PIRG, Super PACs spent over $600 million during the 2012 campaign cycle. The "bulk of their funds [came] from a small set of wealthy donors and corporations making very large contributions." Approximately 11% of all Super PAC funds came from corporate donations, totaling nearly $72 million in all. Corporate donations made up the second largest source of all Super PAC funds in 2012.

Contrary to the POLITICO article, Chevron is just one example of a corporation that has embraced Super PACs as well as other forms of political efforts. In 2012, the company gave over $4.1 million in disclosed contributions alone, including a single $2.5 million check to the conservative Super PAC Congressional Leadership Fund.

Some of the largest recipients of corporate contributions during the 2012 campaign were conservative Super PACs. Restore Our Future, Inc., the premier pro-Romney group, received $26.2 million, or 19.9% of its overall donations, from businesses. Similarly, the Karl Rove-founded American Crossroads received $13.3 million, 16.7% of total donations, from corporations. The conservative group Freedomworks for America took in over 36% of its $15.4 million haul from direct corporate donations. On the Democratic side, Workers' Voice raised $3.8 million from corporations, comprising nearly a quarter of its total donations. Majority PAC received $3.2 million, or 9.4% of its donations, from corporations.

The $72 million corporations spent to influence the 2012 elections through Super PAC contributions is publicly known because Super PACs are subject to donor disclosure requirements. Corporate donations to 501(c) organizations, which are not required to make contributor information public, remain secret. Trade associations, for example, spent over $55 million on political activity in 2012. While it is very likely that a significant portion of that amount came directly from corporate treasuries, trade associations' 501(c)(6) status allow them to keep the source of this money a secret.

Proponents of corporate disclosure gained a glimpse into corporate political activity earlier this year when tech-giant Qualcomm agreed to release its previously undisclosed political contributions as a part of a settlement agreement with New York's Comptroller General. The release showed that while Qualcomm donated $161,000 directly to candidates and their committees, it gave almost 18 times that much in contributions that are not subject to disclosure laws. The company donated $90,000 to 501(c)(4)s, over $1.8 million to trade associations, and $1 million to a single 501(c)(3) organization whose goal is to promote deficit reduction. If Qualcomm's contributions are representative of other corporations', then the contention that corporations prefer to donate directly to candidates is inaccurate. A significant amount of "dark money" is flowing from corporate general treasuries into American elections with no disclosure or opportunity for the public to hold these corporations accountable.

Although it may be true that the majority of corporations have been hesitant to publicly donate to independent Super PACs thus far, the effects of those who have are not insignificant. Corporations gave tens of millions to Super PACs in the 2012 election cycle alone. Even more troubling is the fact that this is only a small sliver of the full picture. Because Congress has failed to pass adequate disclosure laws, the majority of the money corporations like Qualcomm spend to influence elections remains secret. Until these types of donations are subject to public disclosure, consumers have no way to know where their hard-earned money goes when they purchase these corporations' products and services. This is why groups like Common Cause will continue to pressure Congress to pass essential disclosure laws so that corporations can be held accountable for influencing American elections.

Office: Common Cause National

Issues: Money in Politics

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