published Sunday, July 15th, 2012

Worse than superPACS

When the U.S. Supreme Court ruled in the Citizens United case two years ago that rich individuals and corporations could spend an unlimited amount of money on political advertising, so long as it was not technically coordinated with candidates' campaigns, the immediate fear was that new "superPACS" allowed under the ruling would ultimately dictate the shape and outcome of this nation's political elections by the sheer volume of slick attack ads they could buy.

But there's now a larger concern on the political horizon: the corporate and political misuse of tax-exempt groups established under IRS laws as nonprofit "social welfare agencies" that are chartered to operate behalf of the broad public good in their communities. Some these nonprofit groups are now, apparently wrongly, exploiting their tax-exempt status, and simultaneously masking the identity of their funders, by quietly receiving and spending vast amounts of money on political advertising promoting the legislative and election agenda of the Republican right wing.

Abuse of tax-exempt status

Because they are not supposed to be engaged in partisan political activities under their 501(c)(4) charters, they are not required -- as are the superPACS -- to register with the Federal Election Commission, which oversees and publicly lists political donations and donors, and the activities they fund. As a result, the extent of the 501(c)(4)s' donor lists and the dollar amount of their partisan political activities is not fully known. But the information accumulated by nonprofit Washington watchdogs, including Citizens for Responsibility and Ethics, the Center for Political Accountability, and the Center for Public Integrity, is troubling. It suggests their partisan political spending is immense.

Aetna, the insurance industry behemoth, for example, gave $3 million earlier this month to the American Action Network, a right-wing nonprofit 501(c)(4) group that has spent millions criticizing President Obama's Affordable Care Act and the lawmakers who supported it, The New York Times reported last week.

Aetna's gift to the American Action Network, moreover, came even as the company's president was saying publicly that he supported the ACA. Aetna also gave $4.5 million last year to the U.S. Chamber of Commerce, which, under its tax-exempt "business league" charter, spent $33 million in the last cycle of its political advertising largely opposing the policies of Obama and Democrats. And it expects to spend even more the same way this year.

Among other corporations reported to have given huge tax-exempt donations to "social welfare agencies" for similar political purposes were Merck, the pharmaceutical giant, Dow Chemical and Prudential Financial. Disclosure of such corporate contributions is infrequent, and generally shielded from stockholders and the public by the pass-through to tax-exempt organizations, which themselves are technically allowed only to advocate for the interest of public policies that serve general social welfare.

Still, research by the Center for Responsible Politics and the Center for Public Integrity, The Times reported, showed that spending by the tax-exempt groups outpaced the superPACS by a 3 to 2 margin in 2010. So far in the current 2012 cycle, they reportedly have raised that margin to account for two-thirds of the outside political spending.

"Companies want to be able to quietly push for their political agendas without being held accountable for it by their customers," Melanie Sloan, executive director of the Citizens for Responsibility and Ethics, told The Times. "I think the 501(c)(4)'s are likely to outweigh superPac spending, because so many donors want to remain anonymous."

GOP's protection racket

That view has become broadly embraced by all but the Republican leadership in Congress. Sen. Mitch McConnell, the Senate Republican leader, for example, is resisting having the IRS review the partisan activities of these supposedly "social welfare groups." He said in a recent essay that he believes IRS reviews would be "un-American" and would chill their First Amendment free speech rights.

His view is plainly intended to provide political cover for their secrecy. Yet it's not their First Amendment rights that are threatened. They can enjoy all those rights -- indeed, all their super enriched rights under the Supreme Court's Citizens United ruling -- without the limits on political giving that apply to ordinary Americans.

What is at stake in the secrecy that surrounds hundreds of millions of dollars now being spent on partisan political activities by corporations and other donors who are not being held accountable for the political attacks their donations are supporting. Americans voters should know the source of the money being used for political attack ads. Such knowledge is essential to informed voting and the sustainability of our democracy.

Comments do not represent the opinions of the Chattanooga Times Free Press, nor does it review every comment. Profanities, slurs and libelous remarks are prohibited. For more information you can view our Terms & Conditions and/or Ethics policy.

But money is speech, so next they want to buy votes.

It's legitimate.

If you don't believe them, they'll buy a law or two.

July 15, 2012 at 1:18 a.m.
EaTn said...

This court ruling just underscored the fact that our legislation process is purchased by the highest bidders. History has just proven again that two hundred years or so is about the limit on a particular style government.

July 15, 2012 at 5:13 a.m.
Easy123 said...


Don't you get tired of spewing the same stupid propaganda?

July 15, 2012 at 9:12 a.m.
EaTn said...

JonRos said..."The Progressives operate outside the bounds of constitutional governments"

Who setup Gitmo and other places with alleged torture chambers...and who made it plain that we would no longer adhere to these non-American practices? Who invaded a sovereign country under pretense and who got us out of it after ten grueling years?

July 15, 2012 at 4:49 p.m.
Easy123 said...


Show me a "ProgDem" that loved Saddam Hussein.

July 15, 2012 at 7:11 p.m.
Easy123 said...


LOL! Lies, lies and more BS!

Being against war is in no way a vote in favor of Saddam Hussein.

Keep reaching!

July 15, 2012 at 7:23 p.m.
Easy123 said...


We already acted against Saddam. It was called the Gulf War. That ended quickly.

Then Baby Bush starts another war based on complete fabrications (WMD's in Iraq) and thousands of our soldiers die. Oh, but we got Saddam! Who freaking cares?

Our men and women were sent to war because G.W. Bush wanted to defend his fathers honor. He lied and fabricated elaborate stories about "weapons of mass destruction". But you don't care. You're a Republican war-monger through and through.

Keep reaching, sweetheart! Your straw man argument isn't going to fly.

July 15, 2012 at 7:35 p.m.
lkeithlu said...

Refusing to act against the Hitler of our time is the same as endorsing his actions.

Saddam Hussein cannot hold a candle to the evil that was Hitler. How dare you equate the dictator of a third world backwater to the likes of Hitler. Get a grip.

July 15, 2012 at 7:48 p.m.
Easy123 said...


That's the Conservative default hyperbole.

Saddam orders the murder of around 5,000 Kurds and around 200,00 Iraqi's and others that "disappeared" (likely killed by secret police). With a total estimate of people killed on his watch hovering around 500,000.

Hitler orders the murder of around 11-13 million Jews, Non-Jewish Poles, Homosexuals, disabled, Serbs, Communist, gypsies, Freemasons, Slavs, POW's, Jehovah's Witnesses, etc.

They can somehow consider the two equal in some way. Saddam was a 1/24th Hitler at best. There is no comparison between the two.

July 15, 2012 at 7:57 p.m.
lkeithlu said...

Not to mention the Nazi Reich that invaded and occupied many countries. I think Iraq tried to occupy Kuwait.

July 15, 2012 at 8:32 p.m.
EaTn said...

Sadam had one significant attribute...he hated the Iranians and was the one stability factor in the region. We had a lid on Sadam on his genocides and he was in control of the country's religious squabbles, but Bush had the fairy-tale visions of a democratic Iraq that he just had to carry out. Ten years later of our blood and trillion dollars wasted, and Iran is in a position to waltz into Iraq without firing a shot.

July 16, 2012 at 6:32 a.m.
Leaf said...

Well, the trolls deflected you to an old war instead of the subject of this article. What about this unlimited secret money influencing American politics?

July 16, 2012 at 9:46 a.m.
EaTn said...

Leaf....yeah, you're right. After several comments the subject seems to change. Your question on donations: my thought is that only voters should be allowed to donate to candidates in their voting district only, which means that neither corporations nor foreigners would be allowed.

July 16, 2012 at 11:33 a.m.
Leaf said...

The supreme court disagrees. The right wing members think that corporations and foreign governments are people too and not allowing them to influence politics with unlimited secret money is trampling on their right to free speech. I believe history will decide that the Citizens United decision was a terrible blow to U.S. Democracy.

We need a new Constitutional amendment concerning campaign reform and lobbying.

July 16, 2012 at 3:59 p.m.
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