Nonprofit spending increased as the groups were freed to spend money on express advocacy advertisements. While more than half the money spent by non-disclosing groups went to so-called electioneering communications, issue ads that had previously been allowed, almost the entire growth in spending by non-disclosing groups came from the newly-allowed express advocacy, which grew from $6.9 million in 2008 to $62 million in 2010.
Super PACs have even gotten in on the secret money act. While Super PACs are required to disclose their donors, they can accept contributions from nonprofits that do not disclose their donors and from corporations, some of which either do not identify their owners or dissolve upon making a large donation. This has already caused controversy for the Romney-backing Restore Our Future, which received three $1 million contributions from corporations that appear to do no business, one of which dissolved a few months after making the donation.
"The money has shifted to the fringes and it's become less and less transparent," said Center for Responsive Politics Executive Director Sheila Krumholz. "It's shifting away from the parties, the candidates, the PACs, and shifting to these unregulated groups and becoming much and much more secret."
The decrease in disclosure was aided by a 2007 ruling by the FEC that gutted a provision of the McCain-Feingold campaign finance reform law requiring the disclosure of donors to groups spending money on election ads, whether they be issue ads or express advocacy.
"We had 100 percent disclosure for nonprofit spending on electioneering communications in 2004," explained Craig Holman, the lobbyist for the watchdog group Public Citizen. "The FEC changed the disclosure rule in 2007 to only require disclosure for contributors who earmark their donations for [express advocacy and issue] spending, which no one does. Now, everyone has figured out that they don't have to disclose at all."
Tuesday, September 27, 2011
Super PACs and Disclosure
At The Huffington Post, Paul Blumenthal has a long piece on Super PACs and nonprofits: