Thomas Fitzgerald: Winning while losing

Sheldon Adelson, who gave$150 million in a losing cause, is seeking meetings on Capitol Hill.
Sheldon Adelson, who gave$150 million in a losing cause, is seeking meetings on Capitol Hill. (AP)

Election defeats aren't the whole story of Big Money's power.

Posted: December 10, 2012

WASHINGTON - In national politics, this was the year of the super PAC. Along with "dark money" nonprofits that don't have to disclose their donors, they poured billions into the 2012 election, most of it boosting Mitt Romney and Republican candidates for Congress.

Yet Big Money won barely a third of the races it tried to sway, according to the nonpartisan Sunlight Foundation. "Seldom has so much been spent for so little," said political scientist Thomas Mann.

Maybe, as some argue, the loosening of controls on campaign spending, occasioned by the Citizens United Supreme Court ruling and Federal Election Commission regulatory decisions, is not so harmful after all.

Several of the top experts in campaign-finance law said last week, however, that the win-loss record is not an accurate measure of the harm done by the money now sloshing around the political system.

"The real danger of the super PACs is they provide potential corrupting influence for their big donors over government decisions, and that's true regardless of who wins the elections," said Fred Wertheimer, president of Democracy 21 and a longtime advocate of controlling campaign cash. He was speaking at a National Press Club conference on the issue last week.

Just 102 people, millionaires and billionaires, gave about 40 percent of all money donated to super PACs. Those donors "basically purchased a premium seat at the table in Washington when it comes to government decisions in the future," Wertheimer said.

Sheldon Adelson, the billionaire casino magnate who propped up Newt Gingrich's GOP primary campaign and gave generously in aid of Romney - $150 million in all - is seeking meetings with lawmakers on Capitol Hill to discuss changes to a law that federal authorities are using to investigate the dealings of his casinos in Asia, according to news reports.

Nothing has happened, and Adelson ultimately may not win what he wants on the Hill, but some doors will be opened for him because of his donations, and that, to Wertheimer, is troublesome. "I think this [2012] was spring training for what we're going to see happen," he said.

Big donors are not shying away. Adelson has told interviewers he will spend up to $100 million on the 2014 midterm elections for the House and Senate.

Sheila Krumholz, executive director of the Center for Responsive Politics, says voters were robbed of important context in evaluating what they were seeing because of weak disclosure requirements.

Some donors' identities were shielded behind (legal) shell corporations that in turn passed money on to super PACs, and an entire class of nonprofits organized under Section 501(c)(4) of the tax code do not have to disclose their contributors at all.

"Voters were hamstrung," Krumholz said. "They were carpet-bombed with these ads, often misleading negative attacks, yet had one hand tied behind their backs because of the lack of disclosure, which meant they couldn't consider the source of the ads or what ulterior motive drove them to sponsor political ads."

Trevor Potter, a former chairman of the FEC, said that the Supreme Court, in Citizens United, "made a very clear statement that disclosure is required." But the commission's regulations make it easy to avoid disclosure, if a donor is not giving expressly for "electioneering communication," he said.

The FEC, split between the parties, cannot act because the three GOP members object to requiring more disclosure, Potter said. With five of six of the members' terms expiring, he suggested President Obama could use his appointment power to get commissioners, including Republicans, who support disclosure.

In addition, Wertheimer's group and Potter's Campaign Law Center are weighing a lawsuit to force the IRS to tighten regulations so political committees cannot get the tax-exempt status they are using to avoid disclosure of contributors. Legislation pending in Congress would establish a system of public financing for presidential and congressional campaigns that matches donations of $250 or less, and also would make it easier to show illegal coordination between a candidate and a super PAC - if the latter uses consultants and lawyers who have worked for the candidate in the past, for instance.

"Scandals help - they are central to changing the system," Wertheimer said, calling them inevitable.

It may not require a scandal, since members of Congress in both parties are upset with a system that makes them raise even more money to guard against a possible strike from a super PAC in the next election.

"It's not a bad place to start when both sides don't like the status quo," Potter said.


Contact Thomas Fitzgerald

at 215-854-2718 or tfitzgerald@phillynews.com, or follow @tomfitzgerald on Twitter. Read his blog, "The Big Tent," at www.philly.com/BigTent.

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