Profile: Center for Responsive Politics (CRP)
Center for Responsive Politics (CRP) was a participant or observer in the following events:
In the aftermath of the Watergate scandal (see August 8, 1974), amendments to the Federal Election Campaign Act (FECA—see February 7, 1972) provide the option for full public financing for presidential general elections, matching funds for presidential primaries, and public expenditures for presidential nominating conventions. The amendments also set spending limits on presidential primaries and general elections as well as for House and Senate primaries. The amendments give some enforcement provisions to previously enacted spending limits on House and Senate general elections. They set strict spending guidelines: for presidential campaigns, each candidate is limited to $10 million for primaries, $20 million for general elections, and $2 million for nominating conventions; Senatorial candidates are limited to $100,000 or eight cents per eligible voter, whichever is higher, for primaries, and higher limits of $150,000 or 12 cents per voter for general elections; House candidates are limited to $70,000 each for primaries and general elections. Loans are treated as contributions. The amendments create an individual contribution limit of $1,000 to a candidate per election and a PAC (political action committee) contribution limit of $5,000 to a candidate per election (this provision will trigger what the Center for Responsive Politics will call a “PAC boom” in the late 1970s). The total aggregate contributions from an individual are set at $25,000 per year. Candidates face further restrictions on how much personal wealth they can contribute to their own campaign. The 1940 ban on contributions from government employees and contract workers (see 1940) is repealed, as are the 1971 limitations on media spending. Perhaps most importantly, the amendments create the Federal Election Commission (FEC) to oversee and administer campaign law. (Before, enforcement and oversight responsibilities were spread among the Clerk of the House, the Secretary of the Senate, and the Comptroller General of the United States General Accounting Office (GAO), with the Justice Department responsible for prosecuting violators (see 1967).) The FEC is led by a board of six commissioners, with Congress appointing four of those commissioners and the president appointing two more. The Secretary of the Senate and the Clerk of the House are designated nonvoting, exofficio commissioners. [Federal Elections Commission, 1998; Campaign Finance Timeline, 1999; Center for Responsive Politics, 2002 ] Part of the impetus behind the law is the public outrage over the revelations of how disgraced ex-President Nixon’s re-election campaign was funded, with millions of dollars in secret, illegal corporate contributions being funneled into the Nixon campaign. [Campaign Finance Timeline, 1999; Connecticut Network, 2006 ]
Investigative reporter Seymour Hersh publishes a scathing portrayal of Defense Policy Board (DPB) chairman Richard Perle, who Hersh alleges is using his position in the Pentagon to profiteer on the upcoming Iraq war. Hersh does not accuse Perle of breaking any laws, but he does show that Perle is guilty of conflicts of interests. The article, which is released days before its official March 17 publication date, prompts outrage from Perle and his neoconservative defenders, with Perle saying any questions of his potential conflicts of interest would be “malicious,” calling Hersh a “terrorist” (see March 9, 2003), and threatening to sue Hersh, a lawsuit that is never filed (see March 12, 2003). Later in the month, Perle will resign from the DPB over his conflicts of interest as detailed by Hersh (see March 27, 2003).
Dealings with Corrupt Saudis in Violation of Federal Conduct Guidelines - Hersh provides readers with details of Perle’s business dealings with the notoriously corrupt Saudi businessman and arms dealer Adnan Khashoggi (perhaps most famous in the US for his involvement in Iran-Contra—see July 3, 1985) and his activities as a managing partner of the venture capital firm Trireme Partners LP. Trireme is involved in investments that will make large profits if the US actually invades Iraq. Perle, as chairman of the DPB, is subject to the Federal Code of Conduct that bars officials such as himself from participating in an official capacity in any matter in which he has a financial interest. A former government attorney who helped write the code says, “One of the general rules is that you don’t take advantage of your federal position to help yourself financially in any way.” The point is to “protect government processes from actual or apparent conflicts.”
'Off the Ethical Charts' - One DPB member says that he and his fellows had no idea about Perle’s involvement with either Trireme or Khashoggi, and exclaims: “Oh, get out of here. He’s the chairman!… Seems to me this is at the edge of or off the ethical charts. I think it would stink to high heaven.” The DPB member is equally disturbed that fellow board member Gerald Hillman, Perle’s partner in Trireme, was recently added to the board at Perle’s request. Hillman has virtually no senior policy or military experience in government before joining the board. Larry Noble, the executive director of the Washington-based Center for Responsive Politics, says of Perle’s Trireme involvement: “It’s not illegal, but it presents an appearance of a conflict. It’s enough to raise questions about the advice he’s giving to the Pentagon and why people in business are dealing with him.… The question is whether he’s trading off his advisory-committee relationship.”
Lining up Investors, Overthrowing Saddam - According to Khashoggi, Perle met with him in January 2003 to solicit his assistance in lining up wealthy Saudi investors for Trireme. “I was the intermediary,” Khashoggi says. Together with Saudi businessman Harb Zuhair, Perle hoped to put together a consortium of investors that would sink $100 million into his firm. “It was normal for us to see Perle,” Khashoggi says. “We in the Middle East are accustomed to politicians who use their offices for whatever business they want.” But Khashoggi says Perle wanted more than just money—he wanted to use his position in both Trireme and the DPB to, in Perle’s words, “get rid of Saddam” Hussein. Perle admits to meeting with Khashoggi and Zuhair, but says that money never came up in conversation, and as for Hussein, Perle says he was at the meeting to facilitate a surrender bargain between Hussein and the US.
Khashoggi Amused - Khashoggi is amused by Perle’s denials. “If there is no war, why is there a need for security? If there is a war, of course, billions of dollars will have to be spent.… You Americans blind yourself with your high integrity and your democratic morality against peddling influence, but they were peddling influence.” Hillman sent Zuhair several documents proposing a possible surrender, but Zuhair found them “absurd,” and Khashoggi describes them as silly. (Hillman says he drafted the peace proposals with the assistance of his daughter, a college student.) Perle denies any involvement in the proposals. When the proposals found their way into the Arabic press, Perle, not Hillman, was named as the author.
Blackmailing the Saudis? - Prince Bandar bin Sultan, the influential Saudi ambassador to the US and a close friend of the Bush family, says he was told that the meeting between Perle and the Saudi businessmen was purely business, but he does not believe the disclaimers. He says of Perle, who publicly is a vociferous critic of Saudi Arabia (see July 10, 2002): “There is a split personality to Perle. Here he is, on the one hand, trying to make a hundred-million-dollar deal, and, on the other hand, there were elements of the appearance of blackmail—‘If we get in business, he’ll back off on Saudi Arabia’—as I have been informed by participants in the meeting.” Iraq was never a serious topic of discussion, Bandar says: “There has to be deniability, and a cover story—a possible peace initiative in Iraq—is needed. I believe the Iraqi events are irrelevant. A business meeting took place.” [New Yorker, 3/17/2003]
Political scientist Timothy Groseclose of UCLA and economist Jeffrey Milyo of the University of Missouri-Columbia release a study entitled “A Measure of Media Bias” that purports to document the “liberal bias” of the mainstream media. Unfortunately for Groseclose and Milyo’s conclusions, their measure of “bias” is found severely wanting, and they fail to mention the substantial body of scholarly work that challenges their theories. The study contains observations of 20 mainstream news outlets, including national newspapers, news magazines, and network and cable television news channels. [Groseclose and Milyo, 12/2004; MSNBC, 12/19/2005; Media Matters, 12/21/2005]
Previous Positions at Conservative Institutions - Groseclose and Milyo have previously received significant funding for their research from three prominent conservative think tanks: the American Enterprise Institute for Public Policy Research (AEI), the Heritage Foundation, and the Hoover Institution on War, Revolution, and Peace. Groseclose has served as a fellow of the Hoover Institution, while Milyo received a $40,500 grant from AEI. Both were named as fellows by the Heritage Foundation. The two authored an article for the conservative American Spectator in 1996.
Flawed Study - Groseclose and Milyo, according to their study, “measure media bias by estimating ideological scores for several major media outlets” based on the frequency with which various think tanks and advocacy organizations were cited approvingly by the media and by members of Congress over a 10-year period. In order to assess media “bias,” the authors assembled the ideological scores given to members of Congress by the liberal group Americans for Democratic Action; examined the floor speeches of selected members to catalog which think tanks and policy organizations were cited by those members; used those citations as the basis for an ideological score assigned to each think tank (organizations cited by liberal members were scored as more liberal, whereas organizations cited by conservative members were scored as more conservative); then performed a content analysis of newspapers and TV programs to catalog which think tanks and policy organizations were quoted. If a news organization quoted a think tank mentioned by conservative members of Congress, then it was said to have a conservative “bias.” The authors write: “As a simplified example, imagine that there were only two think tanks, and suppose that the New York Times cited the first think tank twice as often as the second. Our method asks: What is the estimated ADA score of a member of Congress who exhibits the same frequency (2:1) in his or her speeches? This is the score that our method would assign the New York Times.” The progressive media watchdog organization Media Matters will call the methodology “bizarre,” and will write: “If a member of Congress cites a think tank approvingly, and if that think tank is also cited by a news organization, then the news organization has a ‘bias’ making it an ideological mirror of the member of Congress who cited the think tank. This, as Groseclose and Milyo define it, is what constitutes ‘media bias.’” [Groseclose and Milyo, 12/2004; Media Matters, 12/21/2005] In December 2005, the parent company of the Wall Street Journal, Dow Jones and Co., will question the study’s validity, noting: “[I]ts measure of media bias consists entirely of counting the number of mentions of, or quotes from, various think tanks that the researchers determine to be ‘liberal’ or ‘conservative.‘… And if a think tank is explicitly labeled ‘liberal” or “conservative’ within a story to provide context to readers, that example doesn’t count at all. The researchers simply threw out such mentions.” [Poynter Online, 12/21/2005]
Classifying Organizations - Groseclose and Milyo assign “scores” to a variety of partisan and nonpartisan advocacy groups and think tanks. Some of these scores are problematic:
The National Rifle Association (NRA), widely characterized as a strongly conservative organization, scores a 49.5 on a 100-point scale, classifying it as barely conservative;
The RAND Corporation, a nonprofit research organization closely affiliated with the Defense Department, scores a 60.4, classifying it as strongly liberal;
The Council on Foreign Relations, a nonpartisan political organization featuring both Republicans and Democrats on its board and headed by a former Bush administration official, scores a 60.2, classifying it as solidly liberal;
The American Civil Liberties Union (ACLU), an organization consistently reviled by conservative pundits, scores a 49.8, classifying it as slightly conservative;
The Center for Responsive Politics, a nonpartisan group that tracks political contributions, scores a 66.9, classifying it as highly liberal;
The Center for Strategic and Budgetary Assessments, a defense policy think tank chaired by former Democratic House member Dave McCurdy, scores a 33.9, classifying it as more conservative than AEI and the hard-right National Taxpayers Union.
Lack of 'Balance' Indicates Bias in Study - According to Media Matters, Groseclose and Milyo classify news stories as exhibiting a partisan bias if they fail to balance a “liberal” group’s quote with a “conservative” group’s quote, regardless of the nature of the reporting. For example, the authors cite the National Association for the Advancement of Colored People (NAACP), which they classify as staunchly liberal, as one of the organizations most often quoted without “balancing” quotes from conservative groups. Media Matters will write, “[B]ecause there are no pro-racism groups of any legitimacy (or on Groseclose and Milyo’s list), such stories will be coded as having a ‘liberal bias.’” In contrast, stories featured in the study that quote a spokesperson from the NRA are often “balanced” by quotes from a “liberal” organization, Handgun Control, Inc., though, as Media Matters will note, that organization renamed itself the Brady Campaign to Prevent Gun Violence in 2001, and Groseclose and Milyo do not include that name in their statistics, “therefore, it is impossible to determine from reading the study if Groseclose and Milyo’s score reflects post-2001 citations by legislators and the media of the group under its new name.” Moreover, because the study only assigns partisan weight to quotes from advocacy groups or think tanks, if a story cites a member of Congress as taking a position and contrasts that position with a quote from a think tank, that story, according to the authors, is “biased” in favor of the think tank’s position. Media Matters calls this practice “miscategorization.”
Assuming Reporter, News Outlet Bias - One of the most questionable practices in the study is the assumption that if a reporter quotes a source, that reporter—or his or her news outlet—must believe the opinions expressed by that source. Media Matters will write that “most, if not all, reporters across the ideological spectrum would find [that assumption] utterly ridiculous.” [Groseclose and Milyo, 12/2004; Media Matters, 12/21/2005] The Dow Jones statement will find, “By this logic, a mention of al-Qaeda in a story suggests the newspaper endorses its views, which is obviously not the case.” [Poynter Online, 12/21/2005] The authors say that only two mainstream news outlets, Fox News and the Washington Times, slant rightward. The study finds that Fox News’s coverage is quite moderate; in a 2005 interview on MSNBC, Milyo will say that Fox’s news coverage can be equated with the moderate Republicanism of Senator Olympia Snowe (R-ME), considered the most “liberal”-leaning Republican in Congress. [MSNBC, 12/19/2005]
Bias Findings at Odds with History - The study makes some odd conclusions about liberal bias: for example, the Wall Street Journal, whose op-ed page has long avowed itself as a champion of conservative thought, is characterized by the study as having more “liberal bias” than any news outlet surveyed. The authors claim that they studied only news reporting and not editorial writings, but as Media Matters will note, “the Journal is respected on both the right and the left, and it would be shocking to hear even the most rabid right-winger assert that the Journal is America’s most liberal news outlet.” [Groseclose and Milyo, 12/2004; Media Matters, 12/21/2005]
Methodology Flawed - In December 2005, a spokesman for Dow Jones will call the study “logically suspect and simply baffling.” The statement will note that Groseclose and Milyo only studied four months of Journal reporting, from 2002, while they studied 12 years of CBS News reporting, 11 years of National Public Radio reporting, eight years of reporting from US News and World Report, and two years of reporting from Time Magazine. The Washington Post and Washington Times were also only studied for brief periods. “Yet the researchers provide those findings the same weight as all the others, without bothering to explain that in any meaningful way to the study’s readers,” the statement will note. It will conclude, “Suffice it to say that ‘research’ of this variety would be unlikely to warrant a mention at all in any Wall Street Journal story” (see December 21, 2005).
Failure to Mention Other Studies - The authors fail to mention a large number of previous studies of “media bias.” They do, however, cite three studies that, according to Media Matters, are as “questionable” as this particular study. One assumed that since conservatives say in surveys that the media is biased, then that bias unquestionably exists. The second assumed that news magazines that sold more subscriptions in geographic areas weighted towards Democratic voters were biased in favor of Democrats. The third is an AEI study whose statistics and methodologies were found to be deeply flawed. Groseclose and Milyo ignore one of the most rigorous and exhaustive studies in recent years, a 2000 analysis by the International Communication Association, which found that newspapers and news magazines exhibited little measurable bias, and television network news broadcasts exhibited measurable but relatively insubstantial bias. That study included 59 other studies, all of which go unmentioned in the Groseclose-Milyo study.
Conservative Bibliography - Media Matters will write that the authors seem almost unaware that other studies of media bias exist. The study’s bibliography is heavily freighted with citations from conservative media critics such as Brent Bozell (founder of the Media Research Center) and Reed Irvine (the late founder of Accuracy in Media). The bibliography also cites an article from the hard-right Internet publication WorldNetDaily. It does not cite any entries from dozens of well-known scholarly journals of communication and media studies, most of which have examined the topic of media bias in their pages. [Groseclose and Milyo, 12/2004; Media Matters, 12/21/2005]
Entity Tags: Olympia Snowe, National Public Radio, National Rifle Association, National Taxpayers Union, RAND Corporation, Timothy Groseclose, Time magazine, Washington Times, Reed Irvine, Washington Post, US News and World Report, Wall Street Journal, National Association for the Advancement of Colored People, International Communication Association, Jeffrey Milyo, Brady Campaign to Prevent Gun Violence, Brent Bozell, Americans for Democratic Action, American Civil Liberties Union, American Enterprise Institute, CBS News, Center for Responsive Politics, Center for Strategic and Budgetary Assessments, Hoover Institution on War, Revolution and Peace, Heritage Foundation, Fox News, Dow Jones and Co., Council on Foreign Relations, Media Matters, WorldNetDaily
Timeline Tags: Domestic Propaganda
Charles Boustany. [Source: US House of Representatives / Wonkette (.com)]Representative Charles Boustany (R-LA), a cardiac surgeon, gives the Republican rebuttal to President Obama’s speech on health care reform (see September 9, 2009). [Politico, 9/9/2009] Boustany tells his listeners that Americans “want health care reform,” but wanted to hear Obama “tell Speaker [Nancy] Pelosi, Majority Leader [Harry] Reid and the rest of Congress that it’s time to start over on a common-sense, bipartisan plan focused on lowering the cost of health care while improving quality.” Boustany acknowledged in an interview that the Republicans had done almost nothing themselves to address the health care crisis, but says in his speech that the Democrats’ reform proposals are too big, too expensive, and too ineffective. [Wall Street Journal, 9/9/2009]
Large Campaign Donations from Health Care Corporations - Boustany is an unusual choice for the response, as the Center for Responsive Politics notes that he has received $1,256,056 from health and health insurance interests in his five-year political career. Such donations make up over 20 percent of his total fundraising. David Donnelly of Public Campaign Actions Fund notes: “There is a conflict of interest when members of Congress stand before the public and recite the same talking points put forth by lobbyists and the heads of insurance and HMO giants opposing health care legislation. Rep. Boustany has taken more than $160,000 in campaign contributions from insurance and HMO interests alone. Do you think he’ll disclose that to his national audience tonight?” Boustany makes no such mention during his response. [US Newswire, 10/9/2009]
Voted against Children's Health Care, Flu Vaccination Funding - The Democratic Congressional Campaign Committee (DCCC) notes that Boustany voted against the State Children’s Health Insurance Program (S-CHIP), did not support a supplemental appropriations bill that included an increase in flu vaccination funding, and voted against an expansion of COBRA funding, a government program designed to supplement working Americans’ health coverage. DCCC spokeswoman Jessica Santillo says: “Congressman Boustany’s no votes on issues ranging from providing health insurance for children, to fighting pandemic flu, to keeping the doors open at community health centers makes him a credible voice for special interests, but not for hardworking Louisianians who struggle with health insurance companies.” Boustany has explained that his vote against S-CHIP funding was to encourage a different way to expand the program: “I proudly support S-CHIP, so we must ensure our children are getting the quality health care they need. A massive increase of S-CHIP further neglects those children who already slipped through the cracks. These children need to see a doctor to receive care.” [The Hill, 9/9/2009]
Other Details of Boustany's Life and Career Brought Up - Politico notes that Boustany had three malpractice suits filed against him while he was a practicing doctor. Two of the cases were ruled against Boustany, and the third was settled out of court for an undisclosed monetary amount. [Politico, 9/9/2009] Boustany has previously indicated his doubts that Obama is actually an American citizen, aligning him with the “birther” movement [Daily Kingfish, 9/9/2009] , a position he later recanted. [Huffington Post, 9/9/2009] And several progressive blogs delight in recounting his 2004 attempt to purchase an English lordship from a British con artist. [Daily Kos, 9/9/2009]
The Public Campaign Action Fund (PCAF), a campaign finance watchdog organization, finds that insurance and health management organizations (HMOs) have spent over $700,000 a day during the first half of 2009 to defeat health care reform. It also notes that health care and insurance interests, which include organizations outside of the HMOs and insurance companies, have spent roughly $1.4 million a day during the first quarter of 2009 to defeat reform efforts. During the first six months of 2009, the companies spent $126,430,438, mostly on hired lobbyists, to oppose the health care reform legislation working its way through Congress. Since 2007, the companies have spent around $585 million to defeat health care reform. “The insurance and HMO interests are fighting health care reform with hundreds of millions of dollars,” says PCAF’s David Donnelly. “Why are so many in Congress willing to listen to an industry that is spending tens of millions every month on politics rather than on lowering their premiums or helping to address the costs of health care? They need the cash to pay for their campaigns.” The HMO and insurance companies have 1,795 lobbyists registered in Washington to represent their concerns to Congress and members of the Obama administration; the same firms hired almost 2,000 lobbyists in 2008. PCAF says it compiled its data from information provided by the Center for Responsive Politics and the Senate lobbying disclosure Web sites. [Public Campaign Action Fund, 9/15/2009]
In an interview with PBS’s Judy Woodruff, Haley Barbour, the chairman of the Republican Governors Association (RGA), falsely claims that Democrats are outspending Republicans in the midterm election campaigns. The elections are tomorrow, November 2. Barbour agrees with projections that Republicans will do very well in tomorrow’s elections, probably taking back control of the US House and perhaps the US Senate as well. Barbour predicts a stronger sweep than the 1994 elections, which put Republicans in control of both houses of Congress, motivated by Americans’ “anger and even fear” at what he calls “the lurch to the left given us by [Democratic House Speaker Nancy] Pelosi and [President Barack] Obama.” Barbour goes on to claim that one difference between 1994 and 2010 is that “this year, we got outspent pretty heavily. The labor unions saw this coming early, and they have poured money in to try to save Democrat seats. And it hasn’t been any secret to the news media or the Democratic incumbents that this was going to be a hard year for them because the president’s policies are unpopular.” Woodruff does not challenge Barbour’s claims. [PBS, 11/1/2010] In reality, Republican and Republican-supporting organizations have outspent Democrats and their supporters by a 3-1 ratio (see September 13-16, 2010, October 2010, and Around October 27, 2010). Data from the nonpartisan Center for Responsive Politics shows that while the Democratic Party does outspend the Republican Party in the 2010 elections, pro-GOP outside groups have vastly outspent labor unions and other organizations supporting Democrats. The four biggest outside groups spending money on the elections—the US Chamber of Commerce, the American Action Network (see Mid-October 2010), American Crossroads, and Crossroads GPS—all spend their money on behalf of Republicans. Together those four groups spend $99.6 million, far more than the $28.1 million spent on behalf of Democrats by the two largest labor unions. American Crossroads and Crossroads GPS intend to continue spending money to attack Obama and the Democrats even after the election. “It’s a bigger prize in 2012, and that’s changing the White House,” says American Crossroads chairman Robert Duncan. “We’ve planted the flag for permanence, and we believe that we will play a major role for 2012.” American Crossroads and other such groups, on both Republican and Democratic sides, intend to continue fundraising in the wake of the midterm elections and begin campaigning almost immediately for the 2012 presidential elections. Privately, some Democratic strategists say they are not sure how they will answer the challenge posed by Republican-supporting “independent” groups and the huge amounts of cash they raise from wealthy corporate donors. Obama’s senior political advisor David Axelrod says that special interests “have driven a huge truck filled with undisclosed cash through a legal loophole to try and buy this election… is it any surprise that this same, stealthy crowd will try to move on to the White House next? Whatever the outcome Tuesday, this issue is not going away.” [New York Times, 10/31/2010; Washington Independent, 11/1/2010; Think Progress, 11/2/2010]
Entity Tags: David Axelrod, American Crossroads, American Action Network, Center for Responsive Politics, US Chamber of Commerce, Robert Duncan, Democratic Party, Haley Barbour, American Crossroads GPS, Republican Party, Judy Woodruff
Timeline Tags: Civil Liberties
The Center for Responsive Politics (CRP), a nonpartisan campaign finance watchdog organization, finds that independent organizations supporting Republicans and Democrats are spending unprecedented amounts of money on supporting, or more often attacking, candidates for office. The huge rise in spending comes as a direct result of the Citizens United decision that allowed corporations and labor unions to spend unlimited amounts of money on campaign donations (see January 21, 2010). While organizations are spending huge amounts of money on both sides of the political divide, spending for conservative candidates outweighs spending on liberal candidates by an 8-1 margin. CRP’s analysis finds that the increased spending helped Republicans retake the US House of Representatives in 2010, and is having a long-term effect on the nation’s campaign and election systems. [Center for Responsive Politics, 5/5/2011; Think Progress, 5/6/2011]
Most Democratic Spending Comes from Unions - Labor unions gave over $17.3 million in independent expenditures opposing Republican candidates. The union contributing the most: the American Federation of State County and Municipal Employees (AFSCME), with over $7 million. The National Education Association (NEA) formed a “super PAC” (see March 26, 2010) that spent $3.3 million on election activities. Super PACs must disclose their donors and the amounts donated (see 2000 - 2005), but an array of groups under the 501(c) tax laws do not have to disclose that information (see September 28, 2010).
Corporations Spend Lavishly for Republicans - While corporations donated some money to Democratic causes, most of their money went to Republicans. Corporations gave over $15 million to super PACs such as American Crossroads, which supports an array of conservative candidates. CRP notes that conservative groups that do not have to disclose their donors spent $121 million, and corporations and wealthy individuals were the likely sources of almost all of that money.
Secret Donations on the Rise - In the 2006 elections, the percentage of spending from groups that do not disclose their donors was 1 percent. In 2010, it was 47 percent. “Nonprofit” organizations that can legally hide their donors and donations increased their spending from zero percent in 2006 to 42 percent in 2010. For the first time in over 20 years, outside interest groups outspent party committees, by $105 million. The amount of independent expenditure and electioneering communication spending by outside groups has gone up 400 percent since 2006. And 72 percent of political advertising spending by outside groups in 2010 came from sources that were prohibited from spending money in 2006. [Center for Responsive Politics, 5/5/2011]
The logo of InfoCision, the telemarketing firm that received much of the ASWF monies. [Source: InfoCision]Presidential candidate Newt Gingrich (R-GA) has apparently exploited a loophole in campaign finance law that has allowed him to build what McClatchy News calls “a political money machine that raised $54 million over five years,” according to McClatchy reports. Gingrich has used “a supposedly independent political committee that collected unlimited donations” to “finance… a coast-to-coast shadow campaign that raised his profile and provided a launch pad for his presidential run.” Critics call the ASWF issue another aftereffect of the Citizens United decision (see January 21, 2010).
$54 Million over 5 Years - The Gingrich-supporting PAC, “American Solutions for Winning the Future” (ASWF) was closed down in July 2011. Organized as a so-called “527 group” (see 2000 - 2005 and June 30, 2000), the tax-exempt, “nonprofit” organization raised $28.2 million in the two-year period ending December 31, 2010, the last period for which McClatchy has data. The Center for Responsive Politics reports that ASWF raised almost double the amount garnered by the next closest 527. The organization raised some $54 million throughout its existence, from 2006 to July 2011. McClatchy has learned some of the details behind ASWF and is now revealing them to the public. The organization provided at least $8 million to pay for the chartered luxury jets that Gingrich used to fly back and forth around the nation for public appearances and campaigning for president. The jet charters occurred during the 2008 and 2012 presidential primaries.
Largely Financed by Billionaire, Corporate Donations - ASWF has accepted enormous cash donations from billionaires such as Sheldon Adelson, a Las Vegas casino owner, who has emerged as Gingrich’s primary benefactor. Adelson has given $7.65 million to ASWF, including a million-dollar startup contribution in 2006. According to an Adelson spokesperson, “he and Speaker Gingrich go back a number of years.” Adelson is a prominent supporter and financier of Israeli Prime Minister Benjamin Netanyahu, and like Gingrich holds far-right, aggressively territorial views about Israel. Gingrich has made provocative statements about Israel and the Palestinian people over the years, denying that the Palestinians are a separate people and declaring his support for Israel’s forced-settlement plans that have displaced many Palestinians. A Gingrich spokesman says Adelson and others merely gave to the organization because they agree with Gingrich’s views. Charlotte, North Carolina, real estate developer Fred Godley gave ASWF $1.1 million in 2007 and another $100,000 in 2009. Energy firms donated heavily to ASWF: Peabody Energy, the world’s largest private coal producer, and its chief lobbyist Fred Palmer gave ASWF $825,000. Arch Coal, the US’s second-largest coal company, gave $100,000. Oil and gas firm Devon Energy gave $400,000, as did American Electric Power Company and its CEO Michael Morris. Plains Exploration Company gave $200,000. The late Cincinnati billionaire Carl Lindner gave $690,000. Dallas real estate firm Crow Holdings gave $600,000. Minnesota broadcasting mogul Stanley Hubbard gave $385,000. Wisconsin businessman Terry Kohler gave $328,082. California businessman Fred Sacher gave $275,000. NASCAR president James France gave $264,000. Home Depot co-founder Bernie Marcus gave $250,000. Another Las Vegas casino owner, the late Frank Fertitta Jr., gave $250,000, along with his sons; together the three of them co-owned a casino and the Ultimate Fighting Championship sports league. Former CarMax and Circuit City chief Richard Sharp gave $150,000. Stock brokerage titan Charles Schwab gave $150,000. Cincinnati Reds owner Robert Castellini gave $146,000. Political science professor Larry Sabato says that in light of such enormous contributions, “there’s no way that any politician is going to deny you much of anything that you want.”
New Super PACs Supplanting ASWF - In place of ASWF, two new pro-Gingrich super PACs have formed to support Gingrich’s attempt to close the gap between himself and frontrunner Mitt Romney (R-MA) in the Republican primary.
'Diabolical Scheme' to 'Circumvent' Campaign Finance Law - Campaign expert Lawrence Jacobs calls Gingrich’s use of ASWF “clever,” and adds, “Looking back, and now seeing Gingrich as the frontrunner… it’s an ingenious, diabolical scheme to circumvent what’s left of the campaign finance regime.” Jacobs says of the organization: “The money wasn’t used literally to finance a campaign for a particular office. It was used for a general, over-time campaign to keep Gingrich alive politically—an enormously luxurious campaign operation to sustain his political viability for the right time to jump into the presidential race. It’s no accident that he’s popped in in 2012.” Jacobs says ASWF operated “right on the line” of legality. Sabato says ASWF played a key role in resuscitating Gingrich’s flagging political career. His term as speaker of the House ended in scandal and resignation, and his high-profile divorces and profligate personal and campaign spending had led many to assume that Gingrich’s political career was over. But Sabato says Gingrich used ASWF to create what he calls a new kind of informal candidacy, one that shows the inherent weakness of campaign finance laws that are supposed to ensure “nobody could give so much money that they would become too influential, too powerful.” ASWF was always nominally independent, as required by law, but in 2009 Gingrich ousted its board of directors and took the title of general chairman. Gingrich never formed a formal exploratory committee before declaring his candidacy for president. McClatchy observes, “None of his Republican presidential rivals, nor any other federal candidate for that matter, is known to have operated such a committee before formally declaring his or her candidacy.” Gingrich spokesperson R.C. Hammon says Gingrich did not begin considering a presidential campaign until April 2011, and all of his committee activities were “legitimate.” Hammond says: “The purpose of American Solutions was to advance an agenda of free enterprise and tri-partisan solutions. Those were the activities he was undertaking.” ASWF is just one of a network of political entities that Gingrich has created over the last 10 years. He has managed to enrich himself by charging lucrative fees for speeches, consulting for undisclosed health care industry firms, and selling historical documentaries and books. After the group was formed in the fall of 2006, Gingrich sent a letter to potential backers calling it a unique organization “designed to rise above traditional gridlocked partisanship” and to develop “breakthrough solutions to the most important issues facing this country.” Vin Weber, a former Minnesota congressman who served on ASWF’s board for two years, says the group “certainly helped build his path back into political prominence.” He adds, “They basically sent Newt around the country promoting American Solutions.” Weber is now supporting Romney for the presidency. He says that ASWF had “not gotten really up to speed in terms of programming” when he received a call, apparently in 2008, advising him that the board was being abolished. Gingrich then took over as the group’s general chairman.
Relatively Little Spent on Campaign Initiatives, Most Spent on Raising More Money - ASWF proposed a number of campaign and advertising initiatives that would appeal to conservative donors, including:
a “Drill Now!” movement aimed at increasing US oil exploration;
attempts to rally opposition to President Obama’s health care reform efforts;
a campaign to fight climate change legislation that would call for reduced carbon emissions by industrial concerns.
But of $37.9 million raised from 2006 through 2009, the committee spent just $7.2 million on programs, according to its filings with the Internal Revenue Service. Most of the ASWF money was spent on telemarketers and direct-mail appeals to develop a loyal pool of wealthy contributors. InfoCision, an Ohio telemarketing firm that specializes in building lists of “small” donors, was paid some $30 million over the course of the organization’s existence, exhausting much of the money contributed. $17 million of that money was used to finance Gingrich’s travel. [McClatchy News, 12/19/2011; Think Progress, 12/19/2011]
Entity Tags: Bernie Marcus, Benjamin Netanyahu, Richard Sharp, R.C. Hammon, Plains Exploration Company, Sheldon Adelson, Stanley Hubbard, Terry Kohler, Vin Weber, American Electric Power Company, Barack Obama, American Solutions for Winning the Future, Willard Mitt Romney, Arch Coal, Newt Gingrich, Robert Castellini, McClatchy News, Michael Morris, Crow Holdings, Charles Schwab, Center for Responsive Politics, Carl Lindner, Devon Energy, Frank Fertitta Jr., Peabody Energy, Fred Palmer, Internal Revenue Service, InfoCision, James France, Fred Sacher, Larry J. Sabato, Fred Godley, Lawrence Jacobs
Timeline Tags: Civil Liberties, 2012 Elections
Author and political science professor Richard Hasen provides data showing that the Supreme Court’s 2010 Citizens United decision (see January 21, 2010) is directly responsible for a huge rise in corporate “outside” spending on behalf of political campaigns. Recent arguments in defense of the decision have said that “super PACs,” the “independent” political entities that take corporate, labor union, and individual donations for the purpose of making television ads in support of, or opposition to, a particular candidate or party (see March 26, 2010, June 23, 2011, November 23, 2011, January 4, 2012, January 4, 2012, and February 20, 2012) were not created by the Court’s decision, and therefore Citizens United cannot be held responsible for the enormous surge in spending since the decision was rendered. The arguments equate older “527” organizations (see 2000 - 2005, March 2000 and After, and June 30, 2000) and the enormous donations made on their behalf (see January - November 2004) with the activities of super PACs after the Citizens United decision. “The purpose of the drumbeat appears to be to insulate the Supreme Court from further criticism of the Frankenstein’s monster they’ve created,” Hasen writes. He shows that the two types of organizations—527s and super PACs—are quite different. “It is true that before Citizens United people could spend unlimited sums on independent advertising directly supporting or opposing candidates,” Hasen explains. “But that money had to be spent by the individual directly. It could not be given to a political action committee, which had an individual contribution cap of $5,000 and could not take corporate or union funding. In many cases, wealthy individuals did not want to spend their own money on advertising, which would say, ‘Paid for by Sheldon Adelson’ or ‘Paid for by George Soros,’ so fewer of these ads were made. The only way to avoid having your name plastered across every ad was to give to the 527s, which claimed they could take unlimited money from individuals (including, sometimes, corporate and labor union money) on grounds that they were not PACs under the FEC’s definition of PACs. These organizations were somewhat successful, but a legal cloud always hung over them.” After Citizens United, courts and the Federal Election Commission ruled that super PACs could collect unlimited sums from corporations, unions, and individuals for unlimited independent spending. Hasen writes: “The theory was that, per Citizens United, if independent spending cannot corrupt, then contributions to fund independent spending cannot corrupt either. (I am quite critical of this theory about corruption, but that’s besides the point here.) So what was once of questionable legality before the court’s decision was fully blessed after Citizens United.” Using data from the Center for Responsive Politics and its OpenSecrets (.org) Web site, Hasen compares spending during presidential election years.
1992: Wealthy individuals, organizations, and corporations are allowed to spend unlimited sums (see January 30, 1976). Outside spending in that campaign, up through early March 1992, was about $1.5 million.
2000: The law remains essentially unchanged. By March 2000, outside spending was around $2.6 million.
2004: With the advent of “527” groups, by March 2004, outside spending rose to $14 million.
2008: Under similar conditions as 2004, by March 2008, outside spending rose to $37.5 million.
2012: In the first presidential campaign year after the Citizens United decision, spending as of early March 2012 is over $88 million.
2012 outside spending is at 234 percent of 2008 spending, and 628 percent of 2004 outside spending. Hasen writes, “If this was not caused by Citizens United, we have a mighty big coincidence on our hands.” Hasen expects outside spending to rise dramatically once the Republican primary is concluded and the presumptive Republican nominee begins campaigning against President Obama. “Wait until the super PACs and other organizations start raising their unlimited sums for the general election,” Hasen warns. “Further, lots of groups are now using 501(c) organizations rather than super PACs for their campaign spending, in an effort to hide their donors.” Data from the Center for Responsive Politics shows that during the 2010 midterm elections, spending from groups that used the law to hide their donors rose from 1 percent in 2006 to 47 percent. Moreover, “501(c) non-profit spending increased from 0 percent of total spending by outside groups in 2006 to 42 percent in 2010.” And 72 percent “of political advertising spending by outside groups in 2010 came from sources that were prohibited from spending money in 2006.” The record-breaking spending in the 2008 presidential election—$301 million—was eclipsed in the first post-Citizens United election, the 2010 midterms, when corporate and other outside spending topped out at $304.6 million. Hasen writes: “It was an incredible number for a midterm election season. Why did that happen? Citizens United was decided early in 2010.” [Slate, 3/9/2012]
A bar graph issued by the Center for Responsive Politics shows, in the words of the liberal news Web site Think Progress, why Republicans are so strongly in favor of the January 2010 Citizens United decision that lifted restrictions on corporate donations for election and campaign purposes (see January 21, 2010). In 2010, the first election cycle that the decision was in effect, conservative outside groups outpaced liberal/progressive outside groups in spending for the first time since 1996. The data, compiled by the Center, is as follows:
1990 - Conservative outside groups outspent liberal outside groups $3.2 million to $2.4 million.
1992 - Conservative outside groups outspent liberal outside groups $9.4 million to $7.1 million.
1994 - Conservative outside groups outspent liberal outside groups $6.3 million to $2.6 million.
1996 - Liberal outside groups outspent conservative outside groups $9.9 million to $6.5 million.
1998 - Liberal outside groups outspent conservative outside groups $7.5 million to $5.2 million.
2000 - Liberal outside groups outspent conservative outside groups $29 million to $17 million.
2002 - Liberal outside groups outspent conservative outside groups $17.9 million to $4.6 million (see March 27, 2002).
2004 - Liberal outside groups outspent conservative outside groups $121.3 million to $68.5 million (see January - November 2004).
2006 - Liberal outside groups outspent conservative outside groups $38.7 million to $19.6 million.
2008 - Liberal outside groups outspent conservative outside groups $159 million to $120.3 million.
2010 - Conservative outside groups outspent liberal outside groups $183.3 million to $98.9 million (see January 21, 2010).
2012 (to date) - Conservative outside groups outspent liberal outside groups $166 million to $46.9 million.
The chart shows that outside spending was on the rise well before the Citizens United decision, but, as Think Progress legal analyst Ian Millhiser wrote in May 2012: “[A]nother trend is also clear. Prior to Citizens United, which was decided in 2010, left-leaning groups held a moderate-to-significant advantage in election spending. After Citizens United, conservatives absolutely dominated the field.” Millhiser acknowledged that Republican primary spending in the first few months of 2012 played a significant role in the $119.1 million disparity. “Nevertheless, the last two election cycles suggest that conservatives will continue to benefit from Citizens United even once the general election kicks into full gear,” he wrote. ”Citizens United gave such a boost to Republican candidates that outside spending by conservatives grew by more than $70 million from 2008 to 2010, even though 2008 was a presidential election year and outside spending has historically been much higher in these cycles than in off-year [midterm] elections.” [Think Progress, 5/2/2012; Center for Responsive Politics, 8/2012]
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