Super PAC donors have been highly influential in the current presidential campaigns. In my last post, I highlighted who they were and the specific GOP candidates they supported. Many people had a positive response to this post but wanted to know where the money was being spent. While many Super PAC funds are used to create negative television advertisements, a ProPublica diagram portrayed over 200 other paid sources in A Tangled Web.
A Tangled Web is portrayed in a Sankey Diagram showing a flow of information from one side to another. Campaigns and Super-PACs are on the left while Payees are on the right. When a person clicks on either the Campaigns or Super-PAC sections, he or she can see which Payees receive money from them. This diagram even offers a breakdown of the individual Payees and the specific amount of money they received from each source. In fact, one could even click on the Payees side of the diagram and see the flow of information towards the Campaign and Super-PAC portions. The ProPublica chart is a compilation of data from the Campaign Finance API of the New York Times website and FEC filings retrieved by Kim Barker and Justin Elliot of ProPublica. While this Sankey Diagram may be hard at first, proper usage of it sheds keen insight on how third-party sources received Super PAC money. For example, I highlight the payees of “Restore Our Future” and “Winning Our Future” below:
“Restore Our Future” for Mitt Romney
Mentzer Media Services, Inc. – a GOP advertising firm – $24,670,253
Arena Communications – a GOP direct mailing firm – $3,620,678
Podium Capital Group, LLC – a Romney fundraising group – $1,938,520
NMB Research – a Republican polling group – $803,512
Actuate Strategies, LLC – a political consulting firm – $469,858
TargetPoint Consulting, Inc. – a GOP voter targeting firm – $441,750
McCarthy Hennings Media, Inc. – GOP media consulting firm -$421,747
Clark Hill PLC – political law firm headed by Restore Our Future – $144,902
Cambridge Offset Printing – a political merchandise firm -$736
”Winning Our Future”for Newt Gingrich
Media Advantage, LLC – a Pro-Gingrich media advertising buyer – $6,745,257
Marketel Media, Inc. – marketing firm – $6,016,978
Intelimarc, Inc. – Internet and email advertising – $888,650
Election Connections, Inc. –a GOP phone bank -$757,797
Cicero Media LLC –a political consulting and media firm -$367,700
Empire Creative –a TV production company supporting Gingrich – $194,370
Synovation Solutions, LLC –media advertising and phone calls firm -$162,875
Craft Media/Digital –media firm that makes ads and websites -$154,580
Victory Media Group, Ltd. –a phone-calling firm -$137,709
Piryx, Inc. –a fundraising company using major Social Networking Sites to attract donors -$16,493
What do these numbers mean? Well, ProPublica found that over $306 million has been spent on third-party sources by the Super PACs and the candidates. ProPublica also discovered that the same people running Super PACs tended to be the same recipients of such hefty cash. For instance, “Restore Our Future” gave almost $145,000 to the Clark Hill PLC, which is a political law firm headed by this Super PAC. Meanwhile, “Winning Our Future” was created around the same time Empire Creative, a Pro-Gingrich TV production company, was formed. Another common practice by such Super PACs entail a specific candidate and their corresponding Super PAC receiving consultation from the same source. Target Point Consulting, LLC gives “survey research” to Mitt Romney while also providing “direct mail service” to “Restore Our Future”. This has raised legal questions among some campaign finance lawyers because the candidates and Super PACs are prohibited from explicitly working together. Nevertheless, they pay the same source to connect with voters and promote their respective messages. In turn, ProPublica’s “A Tangled Web” showed how complex and expensive presidential campaigns really are.
After all, it is so common for people to say one’s vote counts in the ballot, but watching how campaign financing unfolds in the Citizens United age makes me think otherwise. Even though I may have an impact on who eventually wins the election through my vote, chances are that my decision could be influenced by the plethora negative ads and payees hired by Super PACs. Since many of the Super PAC donors represent narrow interests, concerns that an average citizen like me could have may be less important to potential policy makers. This has been a concern raised by various sides of the Citizens United debate that will continue in the future.
On the other hand, campaigns are very expensive. If a candidate wants to be a household name, they are going to need substantial money to have their voices heard. Wealthier sources can help them in this area because the Supreme Court said they could use their money to support candidates through the Free Speech clause. The fact that so much campaign finance information is available online is hopeful, but many other donors and payees remain unknown. ProPublica noted that many of the marketing firms paid by Super PACs either had no websites or reported little information to the FEC. The websites created by the even Super PACs themselves give no explicit information about their founders or the list of donors provided by other online news sources. In response, some Congressional leaders have called for the passage of the DISCLOSE ACT, which would require all sources to be publicized. In my next post, I will focus on this piece of legislation and how some public advocacy groups are working to track money in politics.
OpenSecrets.org reported that Super PACs have contributed over $150 million to the current primaries. Though these groups were not created by the candidates and national political parties, they support their respective causes. Some donors have been publicly exposed despite the anonymity associated with donating to Super PACs. In this post, I will focus on the people contributing money in support of the GOP candidates.
RESTORE OUR FUTURE: Mitt Romney
Bob J. Perry -$4 million – This homebuilder from Texas initially supported Rick Perry’s campaign before spending money for Mitt Romney. The Center for Public Integrity claimed he was partially responsible for the former controversy over Senator John Kerry’s military record. They also suspected that he helped President Bush get reelected in 2004.
Steven Lund – $2 million – Lund is the Vice Chairman of NuSkin, a Utah-based company, which creates skincare products and dietary supplements.
Julian Robertson – $1.25 million – Robertson was the CEO of the Tiger Management Corporation in New York, which is currently closed.
John Paulson – $1 million – Paulson, who is President of the hedge fund Paulson & Company, bet money against the subprime mortgage market in 2007 and became a billionaire. His current net worth is almost $16 billion.
Edward Conard -$1 million – Conard has been a longtime supporter of Mitt Romney because he served as the co-head of Bain Capital for over 14 years. He currently leads Waters Corporation and Sensata Technologies.
Paul Edgerly – $1 million – Edgerly is a current Bain Capital executive. Bain Capital is a private investment company that was co-founded by Mitt Romney.
Paul Singer – $1 million -As the CEO of the Elliot Management hedge fund, Singer advocated for New Jersey’s same-sex legislation and originally wanted Governor Chris Christie to run for president.
Robert Mercer – $1 million – Mercer is the hedge fund manager of Renaissance Technologies in New York.
Frank Rooney – $1 million -Rooney was responsible for building the current Dallas Comboy’s stadium, and he served as the U.S. Ambassador to the Vatican during George W. Bush’s presidency.
Frank L. VanderSloot – $1 million -VanderSloot is both finance co-chairman of Romney’s campaign and CEO of a dietary/cleaning company called Melaleuca.
William Koch – $1 million – William Koch is the head of Oxbow Carbon.
Mike Fernandez – $1 million – Fernandez heads MBF Healthcare Partners in Florida.
Some leaders in the for-profit college sector also donated money to “Restore Our Future”. The Apollo Group, which owns Phoenix University, contributed $75,000 to Romney’s Super-PAC last month. James Heavener, the CEO of Full Sail University, gave $85,000 and fundraises for Romney in Florida. Kevin Landry has some financial stake in Full Sail University as head of TA Associates, and he donated $120,000. Todd Nelson, CEO of Education Management Corps., has contributed$5,000. Mr. Nelson oversees the functions of various Art Institutes and similar for-profit institutions; in addition, his wife Amy Nelson gave $50,000. USA Today reported that for-profit colleges enroll only 12 percent of American students but are responsible for over half the debt accrued by the total graduating population. Nonetheless, Romney’s campaign has intricate ties to this industry because his family has investments in Goldman Sachs Capital Partners. This group, which consists of many Romney supporters, has 42 percent of the ownership claims in Education Management Corps.
RED, WHITE, AND BLUE FUND: Rick Santorum
Foster Freiss – $1.6 million – This faithful contributor to Rick Santorum is a mutual fund investor; he spent another $9,000 on behalf of Santorum’s campaign as of March 30. Recently, Freiss made some interesting remarks in the current contraception debate because he stated that Bayer aspirin was a simple contraception tool women used to put between their legs years ago. However, he thinks there is too much public discussion on sex in the current age.
William Dore – $1.5 million – William Dore is the head of Dore Energy Group in Louisiana.
Harold Simmons – $1 million - Simmons has always been supported Republican candidates in presidential campaigns because he paid for advertisements attacking both Barack Obama and John Kerry in his home state of Texas.
WINNING OUR FUTURE: Newt Gingrich
The Adelsons – $16.5 million – Sheldon and Miriam Adelson are the owners of various casinos and hotels through their Las Vegas Sands Corporation. Sheldon donated to Newt Gingrich for his both his conservatism and views on Israel. Adelson comes from a Jewish family, but his father never visited Israel when he was alive. Therefore, Mr. Adelson funds the group Birthright Israel, which allows Jewish youth to see their spiritual homeland. Gingrich wants move the U.S. Embassy in Israel to Jerusalem, which is a desire Adelson wants materialized. However, he thinks Gingrich will be out of the race sooner than later because he has faced a lot of losses in the current primaries.
Harold Simmons – $1.1 million
ENDORSE LIBERTY: Ron Paul
Peter Thiel – $2.6 million – Thiel is co-founder of PayPal and used to invest in Facebook. As the only notable donor to “Endorse Liberty”, he only contributed money in January and none in February. Laura Strickler from CBS News reported that this Super-PAC had spent less money than it received in February, so perhaps Ron Paul may be out of the race soon.
AMERICAN CROSSROADS: GOP Party
Harold Simmons – $12 million
Bob Perry – $2.5 million
Irving Moskowitz – $1 million – Moskowitz is a retired doctor who created a charity in California. He supports Israeli expansion in Eastern Jerusalem.
A. Jerrold Perenchio – $2.5 million – Perenchio is the former Chairman of Univision, which is a Spanish television channel.
Robert Rowling – $2.5 million - As CEO of TRT Holdings, Inc., Rowling owns Omni hotels and has ties to the oil industry.
Dean White – $1 million – White is the CEO of Whiteco Industries, Inc., which is a construction and advertisement company based in Indiana.
Now that I have reviewed all the names, contributions, and backgrounds of these donors, I would like to point out some key characteristics of the Super PAC donors. This information portrays who is – and is not – the average donor. Primarily, most of these men are upper-class and work in the financial, energy, and hospitality sectors. Rather than contribute $10, $25, or $50, they have to give at least $500,000 to the Super-PAC of their choice. According to Charles Riley, these 3.7 percent of American donors have contributed 80 percent of all the money spent so far in the elections. Therefore, racial minorities and women are the least represented in these groups, so they are rare kind of Super PAC donor. Emily Wilkins found women represented only 14 percent of Super PAC donors, which is a reversal of a previously upward trend in female political contributions. Whereas wealthy men prefer to give money to Super PACs, women overwhelmingly support charitable causes.
I think it is safe to say that Citizens United took campaign financing to an entirely new level. The $5,000 donation cap formerly placed on longtime political action committees became unlimited for Super PACs. Meanwhile, just a few people in the American population are responsible for most of the money spent so far in the campaigns. While much of the information in this post may be overwhelming and even uncomfortable, such facts have prompted some Senators to push for a new law aiming to restrain the recent effects of Citizens United. My next post focus on how such money is spent, but I leave you with ProPublica’s music video, Oh, Super PACs!, for now.
2010 Supreme Court Decision Impacts Current GOP Primaries
In January 2010, the Supreme Court reached a shocking verdict in regards to campaign financing. The Court reached a 5-4 decision that allowed corporate donors to face fewer restrictions on the amount of money they contributed to campaigns in Citizens United v. FEC. Corporate spending on elections was interpreted as a Free Speech right that was protected under the First Amendment, for corporations are legal persons under the Fourteenth Amendment. In May 2010, a FederalCourt upheld the Citizens United bill when it permitted Super PACS to accept unlimited amounts of money from corporate donors in SpeechNow v. FEC. How did this all happen after years of regulations? Well, allow me take you back the 2008 Democratic Primaries.
As Senators Barack Obama and Hillary Clinton battled each other in the primaries, the conservative action group Citizens United had a different agenda. This nonprofit group, which received corporate funding, wanted to inform Americans on Sen. Clinton’s scandalous and divisive traits in the TV documentary Hillary: The Movie. Former Speaker Newt Gingrich, Sen. Barack Obama, and other political pundits were included in this film seeking to brand her as ill-equipped for the presidency. The Federal Election Commission (FEC) prohibited public showing of the movie under provisions of the McCain-Feingold Act (2002) banning advertisements supporting or attacking candidates close to voting dates. Citizens United decided to sue the FEC over this ban and this case eventually reached the Supreme Court. Though it was initially focused upon the FEC restriction, it eventually transformed into a larger debate regarding special interests groups and their Free Speech rights.
Various laws prohibited corporations and unions from freely spending money in elections. The Federal Election Campaign Act (1971) restricted union and corporate expenditures on campaigns, Austin v. Michigan Chamber of Commerce (1990) sought to limit the co-option of corporations in elections and the McCain-Feingold Act (2003) contained various rules regarding campaign donations from all sources. In response, Citizen United’s attorney Theodore Olson contended that such laws were all unconstitutional because they essentially limited corporate free speech. As a nonprofit organization funded by corporations, Citizens United wanted such bans on advertisements and spending eliminated.
Attorney Olson was in luck because Republican Justices in the Court considered his plea. In the final verdict, they struck down corporate finance bans found in all three laws previously mentioned. Therefore, most corporate restrictions for campaign spending were overruled and advertisements could be biased towards specific candidates at any time. This case was decided in January 2010, and served as a precedent for SpeechNow v. FEC(2010). A Washington, D.C. Federal District Court ruled that Super PACS could receive unlimited funding from corporate donors who could remain anonymous; Super PACS used to have a $5,000 limit on donations until Judges overruled that limit through SpeechNow in May 2010. In effect, Congress would have more difficulty passing a law like McCain-Feingold, and states have to adhere to the precedence of Citizen United v. FEC (2010). The legal impact of Citizens United clearly shows that this law had substantial effects on campaign financing just months after its creation and in the possibly in the future.
Today, a plethora of online blogs and news sources shed insight on campaign financing within the current GOP primaries. The Young Turks reported that a group of Wall Street billionaires pledged to defeat President Obama in this year’s election with $100 million. David and Charles Koch, two brothers heading Koch Industries, held a fundraiser to raise this money, with Charles Koch contributing about $40 million to this cause. On the other hand, most corporate-based money has been going to Mitt Romney’s campaign. A recent Reuters article showed that D.C. lobbyists within the financial and health sectors gave money to his campaign because they support his pro-business stance. About $1.5 million has been given to Romney from 390 lobbyists, some of whom include Google, Inc. and AT&T. However, the other three candidates received a mere $94,000 combined from their lobbyists. Over 65 percent of the political ads aired in the recent Alabama and Mississippi primaries were in support of Romney. Greg Giroux from Bloomberg noted that the “Restore Our Future” Super PAC for Romney aired over 3,656 ads in comparison to 865 from “Winning Our Future” for Gingrich and 582 from “Red, White, and Blue” for Santorum. Altogether, OpenSecrets.org has found that outside spending for both President Obama and the GOP candidates has reached over $92 million, with Super PACS contributing almost $80 million to the overall total reported. In comparison, the total expenditures from the 2008 elections at this time were only $37.8 million, and the amount of public disclosure on Super PAC funders has nose-dived. This information clearly shows that Citizens United and the subsequent SpeechNow decision have really opened the floodgates for rampant corporate spending on electoral campaigns.
It is truly remarkable at how much money has been spent so far on the 2012 presidential race as a result of Citizens United. Although these politicians accept donations from the general public, corporate sources have provided them with substantial funds. The suppression of a documentary critiquing a past presidential candidate paved the way for many restrictions on campaign financing to be overturned. Two years later, a high amount of political donations stem from corporate-backed sources that can essentially influence other voters through television advertisements. Perhaps American politics may be eventually overtaken by pure business interests, but online sources have exposed the numbers since bloggers frequently comment on Citizens United’spolitical impact. In my next post, I will discuss how various political pundits have expressed their views on the Citizens United v. FEC.decision through blogs.