A new report finds that super PACs are primarily funded by large contributions from a small collection of donors.
A new report finds that super PACs are primarily funded by large
contributions from a small collection of donors. The report, which was
published by Illinois PIRG and Demos last Wednesday, synthesizes
information obtained from Federal Election Commission filings from 2010
through the end of 2011.
Part quantitative analysis, part political jeremiad, the document concludes that the large-donor fundraising approach of super PACs “undermines basic principles of citizen sovereignty and political equality.”
The report is available online here.
In the 2010 case, Citizens United v. Federal Election Commission, the Supreme Court ruled that the federal government could not limit donations made to political action committees by individuals or for-profit companies. The result, according to the report, has been a dramatic increase in the extent to which political contributions are dominated by a small, but wealthy donor base.
The data show that through 2011, 96 percent of all super PAC money came from large donations of $10,000 or more. In addition, 40 percent of all money came from just 35 donations, each of $1 million or more.
The new findings come on the heels of the Obama campaign’s announcement that it will begin urging big-ticket donors to give money to Priorities USA Action, the largest Democratic super PAC. The organizations have already played a significant role in the Republican presidential primary -- most notably when casino magnate Sheldon Adelson gave over $10 million to a super PAC aiding Newt Gingrich’s cash-strapped campaign.
Adam Lioz, one the report’s coauthors, described super PAC campaign financing as “a bully-based system, where the strength of a citizen’s voice depends upon the size of her wallet.” The report asserts that when political candidates are primarily bankrolled by a few big donors, they are likely to primarily represent those donors’ interests once in office.
“Super PACs are like kryptonite for our democracy,” Lioz said, quoting a line from the report’s conclusion.
In addition to the size of super PAC donations, Lioz and coauthor Blair Bowie also highlight what they find to be a “small but significant amount of funds coming from secret sources.” Unlike traditional PACs, super PACs are allowed to accept money from 501(c)(4) non-profit companies. According to the IRS tax code, these non-profits are not required to disclose their list of donors. In this way, political donors who wish to remain anonymous may contribute secretly to a 501(c)(4), on the condition that the non-profit will donate part or all of the money to a super PAC. Only the non-profit’s name will then appear on the super PAC’s donation filings.
“[Super PACs] are tools that powerful special interests can use to work their will by drowning out the voices of ordinary Americans in a sea of sometimes secret cash,” said Illinois PIRG spokesperson Marites Velasquez.
The report’s authors outline several policy recommendations aimed at stemming the flow of money into super PACs.
First on the authors’ wish list is a constitutional amendment explicitly giving Congress and state governments the power to regulate individual and corporate campaign contributions. Since Citizens United deemed all campaign finance laws to be inherently unconstitutional, an amendment is now the only legislative recourse Congress has left.
Until the Constitution can be changed, the report recommends that the Federal Election Commission enforce stricter guidelines on coordination between super PACs and political campaigns. While the current rules prevent such coordination, loopholes in the system are vast and numerous. The report’s authors suggest that candidates be barred from helping raise money for super PACs, for example, and prevented from appearing in super PAC ads.
Yet while the report seeks a solution to super PAC spending, Marites Velasquez made it clear that the action committees were representative of larger, more endemic political problems.
“Super PACs represent much of what is wrong with American democracy rolled neatly into one package,” said Velasquez.
Image: Illinois PIRG