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Tuesday, July 13, 2010

American Crossroads and Campaign Finance

The Center for Public Integrity reports:

To jumpstart fundraising, the pro-Republican American Crossroads 527 group is reaching out to powerful politicos such as ex-Sen. Phil Gramm of Texas and aggressively using a new money-collecting entity that can give donors more privacy.

Lackluster fundraising in April and May pulled in only a total of roughly $1.25 million, prompting American Crossroads to recently set up a 501(c)(4) nonprofit arm that is also allowed to get involved in political campaigns, but is less transparent in reporting requirements. Deploying both entities, American Crossroads raised about $8.5 million in June, says Steven Law, the group’s president. Politico first reported the $8.5 million total and some details about the new 501(c)(4)

But sources tell the Center for Public Integrity that only about half of that total went to the 527 group and is slated to be reported publicly on July 20. The other half went to the new 501(c)(4) group — American Crossroads GPS — which does not have to disclose its donors until early 2011.

“There are some kinds of donors who prefer the anonymity of a 501(c)(4),” Law said in an interview. The new 501(c)(4) will also allow American Crossroads to run ads focusing on legislative issues such as taxes, the deficit and health care in the coming months, he said

At, Brian Montopoli writes:

As the RGA and outside groups like American Crossroads (a Karl Rove-backed organization that raised more than $8 million in June, $2 million more than the RNC) rake in the donations amid a Republican fundraising boom driven by anti-Obama sentiment, the RNC concedes that its fundraising has fallen off. Donors, an unnamed GOP strategist told the Washington Post, "want to invest their money to win seats. They don't trust this guy [Steele] to invest their money wisely. . . . They just don't think the RNC is a smart place to invest their money right now."

The RNC counters criticism by noting that it has outraised the Democratic National Committee in more than half of months this election cycle and that it has more cash-on-hand that at this point in the 1994 election cycle, when the GOP took over Congress. But the group has revised its budget downward and has reduced funds for voter mobilization, prompting outside groups to step in to try to fill the void.

The upshot of all this may be that the Republican Party is becoming more decentralized than ever before, with a raft of alternative power centers -- American Crossroads, the RGA, The U.S. Chamber of Commerce, the American Action Network, and even Sarah Palin among them. And that could have serious long-term consequences for the party, since it means less coordination over the deployment of resources.