“Mitch McConnell Has Your Back”: Conservative Billionaires Oppressed By Liberal Thugs
Fear not, billionaire super PAC and 501(c)(4) funders. You may feel oppressed, you may fear the pitchforks and torches of the unwashed masses gathering at the gate of your manse, you may wake in the night in a cold sweat and bellow to your footman, “Dare I give Paul Ryan $10 million for his 2016 presidential race, lest some bearded plebian pen a vicious blog post aimed at my very heart?” If nothing else, Mitch McConnell has your back.
Today, McConnell takes to the pages of The Washington Post to defend the right of America’s millionaires and billionaires to pour their funds into campaigns while remaining anonymous. Those with long memories may recall that when the McCain-Feingold campaign finance law was being debated, McConnell and others said that the answer to the problem of money and politics was disclosure: Let the wealthy give as much as they want, but disclose contributions quickly, and with everything out in the open we could forestall the possibility of corruption. But with McCain-Feingold safely struck down and Citizens United inaugurating a new dawn of American liberty, disclosure is now McConnell’s enemy:
These tactics are straight out of the left-wing playbook: Expose your opponents to public view, release the liberal thugs and hope the public pressure or unwanted attention scares them from supporting causes you oppose. This is what the administration has done through federal agencies such as the FCC and the FEC, and it’s what proponents of the Disclose Act plan to do with donor and member lists.
The fearsome “liberal thugs” notwithstanding, this gets to the heart of democracy’s messiness. You can have a political system where everyone is unfailingly polite to each other, or you can have a system where people are free to express their views, but you can’t have both. By choosing to have a democracy, we make a series of bargains. We enshrine freedom of religion, even though we know that means people who believe in idiotic faiths (i.e. those different from our own) will be able to practice them, too. We create a system of due process, even though that means guilty people, even monstrous people, will be given fair trials with at least the possibility of getting off. And we defend freedom of speech, knowing that that means we’ll have to tolerate the voicing of abhorrent ideas, not to mention Two and a Half Men and the career of will.i.am.
And if our election rules will allow the Sheldon Adelsons of the world to put millions behind their favorite candidate—something which, by the way, residents of most of the world’s democracies find beyond absurd—it isn’t too much to ask that if you choose to use your enormous wealth to attempt to shift the outcome of elections, if nothing else the public should know who you are. That way we’ll know whom our elected officials are indebted to. And yes, there is a price to pay for that participation: people might say you’re wrong, or even call you a jerk. Money is speech, you say? Well freedom of speech means the right to say whatever you want, not the right to be immune from criticism. It’s amazing how often conservatives can’t see the difference.
By: Paul Waldman, Contributing Editor, The American Prospect, May 23, 2013
“Lost In The IRS Scandal”: The Need To Know Facts About The Big Picture And Big Donors Of Dark Money
In the furious fallout from the revelation that the IRS flagged applications from conservative non-profits for extra review because of their political activity, some points about the big picture – and big donors — have fallen through the cracks.
Consider this our Top 6 list of need-to-know facts on social welfare non-profits, also known as “dark money” groups because they don’t have to disclose their donors. The groups poured more than $256 million into the 2012 federal elections.
1. Social welfare non-profits are supposed to have social welfare, and not politics, as their “primary” purpose.
A century ago, Congress created a tax exemption for social welfare non-profits. The statute defining the groups says they are supposed to be “operated exclusively for the promotion of social welfare.” But in 1959, the regulators interpreted the “exclusively” part of the statute to mean groups had to be “primarily” engaged in enhancing social welfare. This later opened the door to political spending.
So what does “primarily” mean? It’s not clear. The IRS has said it uses a “facts and circumstances” test to say whether a group mostly works to benefit the community or not. In short: If a group walks and talks like a social welfare non-profit, then it’s a social welfare non-profit.
This deliberate vagueness has led some groups to say that “primarily” simply means they must spend 51 percent of their money on a social welfare idea — say, on something as vague as “education,” which could also include issue ads criticizing certain politicians. And then, the reasoning goes, a group can spend as much as 49 percent of its expenditures on ads directly advocating the election or defeat of a candidate for office.
Nowhere in tax regulations or rulings does it mention 49 percent, though. Some non-profit lawyers have argued that the IRS should set hard limits for social welfare non-profits — setting out, for instance, that they cannot spend more than 20 percent of their money on election ads or even limiting spending to a fixed amount, like no more than $250,000.
So far, the IRS has avoided clarifying any limits.
2. Donors to social welfare non-profits are anonymous for a reason.
Unlike donors who give directly to politicians or even to Super PACs, donors who give to social welfare non-profits can stay secret. In large part, this is because of an attempt by Alabama to force the NAACP, then a social welfare non-profit, to disclose its donors in the 1950s. In 1958, the Supreme Court sided with the NAACP, saying that public identification of its members put them at risk of reprisal and threats.
The ACLU, which is itself a social welfare non-profit, has long made similar arguments. So has Karl Rove, the GOP strategist and brains behind Crossroads GPS, which has spent more money on elections than any other social welfare non-profit. In early April 2012, Rove invoked the NAACP in defending his organization against attempts to reveal donors.
The Federal Election Commission could in theory push for some disclosure from social welfare non-profits — for their election ads, at least. But the FEC has been paralyzed by a 3-3 partisan split, and its interpretations of older court decisions have given non-profits wiggle room to avoid saying who donated money, as long as a donation wasn’t specifically made for a political ad.
New rulings indicate that higher courts, including the Supreme Court, favor disclosure for political ads, and states are also stepping into the fray. During the 2012 elections, courts in two states – Montana and Idaho – ruled that two non-profits engaged in state campaigns needed to disclose donors.
But sometimes, when non-profits funnel donations, the answers raise more questions. It’s the Russian nesting doll phenomenon. Last election, for instance, California’s election agency pushed for an Arizona social welfare non-profit to disclose donors for $11 million spent on two California ballot initiatives. The answer? Another social welfare non-profit, which in turn got the money from a trade association, which also doesn’t have to reveal its donors.
3. The Supreme Court’s Citizens United decision meant that corporations could pay for political ads, anonymously, using social welfare non-profits.
In January 2010, the Supreme Court ruled that corporations and unions could spend money directly on election ads. A later court decision made possible SuperPACs, the political committees that can raise and spend unlimited amounts of money from donors, as long as they don’t coordinate with candidates and as long as they report their donors and spending.
Initially, campaign finance watchdogs believed corporations would give directly to SuperPACs. And in some cases, that happened. But not as much as anyone thought, and maybe for a reason: Disclosure isn’t necessarily good for business. Target famously faced a consumer and shareholder backlash after it gave money in 2010 to a group backing a Minnesota candidate who opposed gay rights.
Many watchdogs now believe that large public corporations are giving money to support candidates through social welfare non-profits and trade associations, partly to avoid disclosure. Although the tax-exempt groups were allowed to spend money on election ads before Citizens United, their spending skyrocketed in 2010 and again in 2012.
A New York Times article based on rare cases in which donors have been disclosed, sometimes accidentally, explored the issue of corporations giving to these groups last year. Insurance giant Aetna, for example, accidentally revealed it gave $3 million in 2011 to the American Action Network, a social welfare group founded by former Sen. Norm Coleman, a Republican, that runs election ads.
Groups that favor more disclosure have so far failed to force action by the FEC, the IRS, or Congress, although some corporations have voluntarily reported their political spending. Advocates have now turned to the Securities and Exchange Commission, which is studying a proposal to require public companies to disclose political contributions.
The idea is already facing strong opposition from House Republicans.
4. Social welfare non-profits do not actually have to apply to the IRS for recognition as tax-exempt organizations.
With all the furor over applications being flagged from conservative groups — particularly groups with “Tea Party,” “Patriot” or “9/12″ in their names — it’s worth remembering that a social welfare non-profit doesn’t even have to apply to the IRS in the first place.
Unlike charities, which are supposed to apply for recognition, social welfare non-profits can simply incorporate and start raising and spending money, without ever applying to the IRS.
The agency’s non-profit wing is mainly concerned about ferreting out bad charities, which are the biggest chunk of non-profits and the biggest source of potential revenue. After all, the IRS’s main job is to collect revenue. Charities allow donors to deduct donations, while social welfare non-profits don’t.
Most major social welfare non-profits do apply, because being recognized is seen as insurance against later determination by the IRS that the group should have registered as a political committee and may face back taxes and disclosure of donors. A recognition letter is also essential to raise money from certain donors — like, say, corporations.
But some of the new groups haven’t applied.
The first time the IRS hears about these social welfare non-profits is often when they file their first annual tax return, not due until sometimes more than a year after they’ve formed.
In many cases, the first time the IRS hears about these groups is a full year after an election.
5. Most of the money spent on elections by social welfare non-profits supports Republicans.
Of the more than $256 million spent by social welfare non-profits on ads in the 2012 elections, at least 80 percent came from conservative groups, according to FEC figures tallied by the Center for Responsive Politics.
None came from the Tea Party groups with applications flagged by the IRS. Instead, a few big conservative groups were largely responsible.
Crossroads GPS, which this week said it believes it is among the conservative groups “targeted” by the IRS, spent more than $70 million in federal races in 2012. Americans for Prosperity, the social welfare non-profit launched by the conservative billionaire brothers Charles and David Koch, spent more than $36 million. American Future Fund spent more than $25 million. Americans for Tax Reform spent almost $16 million. American Action Network spent almost $12 million.
Besides Crossroads GPS, each of those groups has applied to the IRS and been recognized as tax-exempt. (You can look at their applications here.)
All of those groups spent more than the largest liberal social welfare non-profit, the League of Conservation Voters, which spent about $11 million on 2012 federal races. The next biggest group, Patriot Majority USA, spent more than $7 million. Planned Parenthood spent $6.5 million. VoteVets.org spent more than $3 million.
None of those figures include the tens of millions of dollars spent by groups on certain ads that run months before an election that are not reported to the FEC.
6. Some social welfare groups promised in their applications, under penalty of perjury, that they wouldn’t get involved in elections. Then they did just that.
Much of the attention when it comes to Tea Party nonprofits has focused on their applications and how the IRS determines whether a group qualifies for social welfare status.
As part of our reporting on dark money in 2012, ProPublica looked at more than 100 applications for IRS recognition. One thing we noted again and again: Groups sometimes tell the IRS that they are not going to spend money on elections, receive IRS recognition, and then turn around and spend money on elections
The application to be recognized as a social welfare non-profit, known as a 1024 Form, explicitly asks a group whether it has spent or plans to spend “any money attempting to influence the selection, nomination, election, or appointment of any person to any Federal, state, or local public office or to an office in a political organization.”
The American Future Fund, a conservative non-profit that would go on to spend millions of dollars on campaign ads, checked “No”in answer to that question in 2008. The very same day the group submitted its application, it uploaded this ad to its YouTube account: http://youtu.be/2oEz3lzgDsI
Even before mailing its application to the IRS saying it would not spend money on elections in 2010, the Alliance for America’s Future was running TV ads supporting Republican candidates for governor in Nevada and Florida. It also had given $133,000 to two political committees directed by Mary Cheney, the daughter of the former vice president.
Another example of this is the Government Integrity Fund, a conservative non-profit that ran ads in last year’s U.S. Senate race in Ohio. Its application was approved after it told the IRS that it would not spend money on politics. The group went on to do just that.
By: Kim Barker and Justin Elliott, ProPublica; Published in The National Memo, May 22, 2013
“Can The President Create A ‘Culture’?”: What Matters Isn’t About Culture, It’s People And Politics
As you may have noticed, the biggest problem with the IRS scandal (from the perspective of Republicans) is that it remains stubbornly removed from the President himself. It’s all well and good to get a couple of scalps from mid-level managers, but for it to be a real presidential scandal you need to implicate the guy in the Oval Office in the wrongdoing. Confronted with Obama’s non-involvement, conservatives have turned to vague and airy accusations about the “culture” Obama has created. Mitch McConnell, for instance, is warning darkly that Obama may be not too far removed from Tony Soprano: “I think what we know for sure is that there is a culture of intimidation across this administration—the president demonizing his enemies, attempting to shut people up. There is certainly a culture of intimidation.”
The idea that Barack Obama—whom Republicans regularly accuse of being a foreign-born anti-American socialist communist marxist who is slowly carrying out a plan to destroy America—is the one “demonizing” his opponents is pretty laughable. But the nice thing about the “culture” argument is that to make it, you don’t have to point to any particular thing any particular person has done. It’s just a culture, out there in the ether.
Conservatives are also alleging that the IRS employees who gave extra scrutiny to 501(c)(4) applications of Tea Party groups were in fact acting on Obama’s instructions. It was just that the instructions came in the form of him going out on the campaign trail and lamenting the Citizens United decision and the way it opened the door for all kinds of “dark money” to be injected into campaigns. Once again, it’s a way of ascribing guilt without having any evidence of guilt, but the problem is, it fails from both ends. Lots of people, even many Republicans, joined Obama in lamenting the rise of the new super PACs and 501(c)(4)s. It was an issue when Republicans were using them against each other in the 2012 presidential primaries. And if the IRS employees were trying to help Obama, they were going about it all wrong. As Ed Kilgore says, “The ultimate howler here is that we are supposed to believe that IRS bureaucrats, in obedience to the “dog whistle” of the president’s demonization of conservative groups’ involvement in the 2012 presidential campaign, chose to ignore the groups that were involved in the campaign in a significant way, and instead go after small fry Tea Party organizations.”
But can a president create a “culture” within the government that has consequences for the behavior of bureaucrats down the line, even to the point of sanctioning wrongdoing? The easy answer is, well, sure. Every boss creates an atmosphere that can affect the behavior of the people who work for her. But when you get beyond the people who work in the president’s immediate orbit, what matters isn’t culture, it’s people and policies. For instance, the Bush administration didn’t torture prisoners because Dick Cheney went on Meet the Press and said that to fight terrorism we’d have to go to “the dark side, if you will,” and then folks just got the message and started waterboarding prisoners. It happened because the administration made torture its official policy, and had in place the personnel who were eager to do it.
The United States government is a gigantic entity; even excluding uniformed military, there are 2.7 million federal employees spread around the country. No one, not even the president, can with a few words on the campaign trail create a “culture” that allows misbehavior to happen. I realize that many conservatives believe that Obama and anyone who would ever consider working for him are so corrupt that their immorality must naturally spread through the government like the hantavirus. But that’s not how it works.
By: Paul Waldman, Contributing Editor, The American Prospect, May 22, 2013
“Resonance Resistant”: Republicans Racing Off The Cliff In Their Supercharged Outrage Machine
Whether one thinks the demiscandals being howled about in Washington should or should not resonate more widely, they don’t.
According to a Gallup report released Thursday, “The amount of attention Americans are paying to the I.R.S. and the Benghazi situations is well below the average for news stories Gallup has tracked over the years.” (The Associated Press phone records case wasn’t mentioned.) Why might this be? I have a few theories:
CREDIBILITY People know that the Internal Revenue Service is the conservatives’ bogeyman. It’s the agency that collects the taxes that Republicans hate so much. Some Americans see taxes as, at worst, a necessary nuisance; Republicans see them as an absolute evil. The I.R.S. is the agency that collects the wealth from “us” for the government to redistribute to “them.” As National Journal pointed out Friday, “The agency also implements much of the country’s social policy through the tax code.” We all know that anything with “social” in its name activates the conservative gag reflex.
And on the Associated Press front, it just doesn’t ring true to have Republicans standing up as defenders of the “lame-stream media.” It’s like the person with the club feigning common cause with the baby seal. People just don’t buy it.
Furthermore, Republicans have exhibited a near-pathological need to say anything, no matter how outlandish, that would invalidate the Obama presidency. This has left them with little credibility now that there may be legitimate problems. This is the story of the political party that cried “Kenyan.”
COMPLEXITY Where is Benghazi? Seriously, folks, quickly point it out on a map. Thought so. Now, to the controversy: the talking points — what they said, and the machination of how that was altered, and whether Al Qaeda should have been immediately blamed, and whether the word “terror” should have had an “-ist” or an “-ism.” Seeking to find the killers of four dead Americans is honorable; endless testimony about a fussed-over script used to explain the tragedy is mind-numbing.
UNPOPULARITY It is clear that the Justice Department overreached on the Associated Press scandal and that its strong-arm tactics are likely to have a chilling effect. But Americans are not big fans of mass media. A November Gallup poll found that only a fourth of Americans rate the honesty and ethical standards of journalists highly. Even bankers ranked higher.
As for Tea Party groups that received extra scrutiny from the I.R.S., an Associated Press-GfK poll released last month found that fewer than a fourth of Americans say they support the group. The Tea Party may well be passé.
The policy issue is a different story, as The Washington Post pointed out this week: “In 2010, the Supreme Court’s landmark ‘Citizens United’ decision cleared the way for corporations and labor unions to raise and spend unlimited sums of money, and register for tax-exempt status under section 501(c)(4).”
That decision was extremely unpopular. An ABC News/Washington Post poll released nearly a month after the decision was handed down found that 80 percent of Americans opposed it.
So an unpopular movement applied for tax-exempt status under conditions made possible by an unpopular court decision, in order to influence politics with unfathomable amounts money from unnamed donors? Good luck gaining sympathy for that.
ZEALOTRY The Congressional Tea Party Caucus founder, Michele Bachmann, who never misses a chance to say something asinine, suggested to the conservative site wnd.com that it was “reasonable” to worry that the I.R.S. might use Obamacare to kill conservatives.
The article reads, in part:
“Since the I.R.S. also is the chief enforcer of Obamacare requirements, she asked whether the I.R.S.’s admission means it ‘will deny or delay access to health care’ for conservatives. At this point, she said, that ‘is a reasonable question to ask.’ ”
“Reasonable” and “Bachmann” don’t even belong in the same conversation, let alone the same sentence, and yet she remains one of the most visible spokeswomen for the movement.
Even former House Speaker Newt Gingrich warned Republicans against overreaching. In an NPR interview that aired Friday, Gingrich, referring to the impeachment of President Clinton, said, “I think we overreached in ’98 — how’s that for a quote you can use?”
He continued, advising his party to be “calm and factual.” Ha! That’s too rich, and too late. Republicans are already invoking the I-word.
Republicans are their own worst enemies at times like these, unable to leave well-enough alone, and missing chances to honestly engage the public as they race off the cliff in the supercharged outrage machine.
By: Charles M. Blow, Op-Ed Columnist, The New York Times, May 17, 2013
“The Real IRS Scandal”: Lawmakers Who Pushed The Agency To Rely On Bone-Headed Tactics By Refusing To Fund It To Do Its Job
David Simon, of “The Wire” fame, once responded to the idea of “doing more with less” by saying, “That’s the bullshit of bean counters who care only about the bottom line. You do less with less.” For the Internal Revenue Service, the line should perhaps be updated to “you do less with less, and also cause a scandal.”
The IRS, of course, was recently caught singling out conservative groups seeking tax-exempt status for extra scrutiny. IRS employees in a Cincinnati office used search terms such as “tea party” and “patriot” to find organizations they deemed worthy of more attention in their request to be exempted from paying federal taxes. (The irony of tea party groups complaining about not getting effectively subsidized by the government in a timely enough fashion will be left for another time.)
The “scandal” has already caused the acting commissioner of the IRS to lose his job and prompted a hearing on Capitol Hill Friday during which lawmakers expressed their outrage that the tax agency could act in such a manner. But Congress deserves its own share of blame for the debacle.
Now, the IRS employees who were searching for “tea party” surely should have known better. But the fact of the matter is that the agency has been dealing with a deluge of applications for tax-exempt status at a time when its budget is shrinking. The size of the IRS workforce has dropped 9 percent from its 2010 level, and the agency has seen its budget cut in each of the last two fiscal years. This fiscal year, the amount the IRS spends per capita (meaning per citizen) will be 20 percent lower than it was in 2002, according to an analysis by tax expert David Cay Johnston.
Meanwhile, as Reuters reported, “The IRS has seen the number of groups applying for 501(c)4 status double in the wake of a January 2010 Supreme Court decision that loosened campaign-finance rules.” The Obama administration has requested budget increases for the IRS, but Republicans in Congress refuse to approve them. So it’s perhaps not surprising that already overworked employees at the agency looked for a few shortcuts.
And things are likely not going to get any better this summer when the IRS shuts down entirely for five days due to budget cuts under the so-called “sequester.” These cuts don’t just inconvenience people who need tax assistance; they cost the Treasury money. The IRS estimates that every dollar spent on enforcement brings in $4 to $5 in additional revenue, so cutting the IRS budget is akin to the government cutting off its nose to spite its face.
My colleague Robert Schlesinger noted today that the real scandal surrounding the attack at the U.S. diplomatic outpost in Benghazi, Libya, is not who edited which talking point when, but that the State Department was denied funds to beef up consular security. Much the same can be said for the IRS. The scandal is not about the agency’s shortcuts, but the lawmakers who pushed it towards relying on bone-headed tactics by refusing to give it the money it needs to do its job.
By: Pat Garofalo, U. S. News and World Report, May 17, 2013
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