FEC “Dark Money” Search Could Hurt Nonprofits

by Eric Cochling | Oct 29, 2014

The following is a special report for Georgia Center for Opportunity by Mike Klein. Mike’s other work may be found here.

Video from the Atlanta session may be seen here:

While voters fixate on an election next week that could change Washington’s balance of power, some also are looking ahead to next year’s Federal Election Commission agenda that will include an effort by incoming chair Ann Ravel to overhaul campaign finance disclosure law.  Ravel has established her target-of-choice: corporate political action committees and super PAC expenditures after a 2010 U.S. Supreme Court opinion that ended independent spending limits.

Thousands of non-profit groups could become caught in a tidal wave of proposed changes that might impact how local, state and national organizations can advocate for children’s welfare, education, health care and virtually any other policy.  The concept of the “anonymous donor” who makes community projects and thinking happen could be derailed without considerable care to protect the rights individuals have to use their personal money as they desire.

“Dark money” is the pejorative term opponents created to talk about corporate political action committee and super PAC spending.  Ravel speaks openly about “problems we have with these dark money groups” and her view that “people are getting disgusted about what’s happening.”  She says, “Polls have shown that elected officials are primarily serving their large contributors and not their constituents. That view is held equally by Republicans and Democrats.”

The FEC vice chair was at Emory University in Atlanta last week on the final leg of a three-city swing described as a listening tour to gather public input before her 2015 planned initiative.  Other stops were Denver in early October and the University of Chicago’s new Institute of Politics that was founded by President Barack Obama’s political operative David Axelrod. Obama appointed Ravel to the six-member Federal Election Commission in October 2013. The FEC has three Republican and three Democratic commissioners. Ravel becomes chair in 2015.

The 1971 Federal Election Campaign Act is the cornerstone of U.S. election law.  Perhaps more appropriately, it has become at least a time capsule and perhaps even a tomb as the FECA has not been amended since 1979. Changes to national election finance laws have mainly occurred because of FEC rules and regulations or because federal courts decided various questions brought over three and one-half decades.

In 2010 the U.S. Supreme Court (Citizens United vs. FEC) struck down limits on independent campaign spending by corporations and unions. It opened the door to spending by non-profit groups to support or oppose a candidate without having to disclose donors who could be individuals or other entities including corporations. The Center for Competitive Politics says that spending accounted for $311 million of the $7.3 billion spent in the 2012 election cycle.

Georgia State University law school professor Anne Tucker cited higher numbers when she joined Ravel onstage in Atlanta.  Tucker said corporate political action committees spent $360 million in the 2012 election cycle and she said super PAC funds accounted for another $75 million.  Tucker said 1,220 super PACs that do not disclose their donors raised over $520 million for the 2014 midterm elections.  Tucker like Ravel supports the expansion of disclosure.

Thursday evening’s Emory event was far from a balanced discussion.  Twenty-eight speakers approached the microphone and nearly all said the same thing: Someone must stop the inflow of corporate and other big money into politics.  “I tell people your vote is your voice but I recently have come to believe that I am wrong.  Sadly today your dollar is your voice,” said Robin Collins. “We argue that corporate spending in elections should not be equated to the First Amendment rights of individual citizens,” said Cindy Strickland. Another speaker noted she was “invited to this and also reminded” to attend.

Context is often lost where passion prevails. There was important context from William Loughery who knows of what he speaks.  Now living in Georgia, the soft-spoken Loughery is a former chief of staff to United States Senator Arlen Spector, a former FEC staffer and he participated in writing the 1971 Federal Election Campaign Act which as noted above has not been amended in thirty-five years.

“When we wrote the Federal Election Campaign Act there never was any enforcement so why would anyone waste time on independent expenditures,” said Loughery.  “The fundamental problem is nobody wants to change the law, nobody wants to make a significant radical change to update it because basically, the whole process would be captive of the current members of Congress and even the members of the Commission are basically captives of Congress.  Technology has changed, a lot of other things have changed and there’s nothing being done to update the law.”

Battle plans have specific objectives but battles produce collateral damage. Non-profit groups that focus entirely on policies could become swept up in a federal election campaign law disclosure reform movement.  As a young Emory student told the panel, “You have to look for the unintended consequences and protect individual rights, freedom of speech and the legitimacy of our democracy.  That’s not an easy task.”