Midterm Money Rush: The Secret Outsiders

A story in Capitol News Connection begins,

One of the biggest stories of the 2010 congressional elections reads like a mystery: the identity of donors whose money saturates races nationwide with television spots and other communications.

The story’s author, Paul Barton, explains that

The spending explosion, most observers agree, stems from recent federal court rulings, especially Citizens United vs. the Federal Election Commission, decided earlier this year. The Supreme Court declared corporations, unions and other special interests could spend unlimited amounts from their treasuries to try to influence campaigns, so long as the money doesn’t go directly to candidates.

Given free rein to spend, fat cats and corporations can spend covertly:

Increasingly, … the weapon of choice is 501(c) nonprofit corporation or association…. Nonprofits have the advantage of not having to disclose donors, which makes them attractive to corporations and wealthy donors who fear a backlash from having their political activities publicized.

There’s some hope that this strategy may not survive for long:

Still another issue concerns whether nonprofits abuse their favored tax status through political activity. It is legal for nonprofits to participate in politics but politics cannot be their “primary function.”

Fred Wertheimer, longtime advocate of campaign finance reform at Democracy 21, contends Crossroads Grassroots Policy Strategies, the group founded by Rove, has crossed that line and that the Internal Revenue Service should investigate.

If the IRS were to enforce the “primary function” restriction, these nonprofits would have to find something nonpolitical on which to spend more than 50% of what they take in, which would make them very inefficient vehicles for channeling political cash.

About Hamilton Richards

I retired in 2006 as a Senior Lecturer in Computer Sciences at The University of Texas at Austin. These days I volunteer technical support for Citizens' Climate Lobby (Austin chapter), Common Ground for Texans, (CG4Tx.org), Integrity Texas (IntegrityTexas.org), and several friends.
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