Super PAC Corporate Donations: Not All Contributions Are Equal
WASHINGTON -- "Corporations are people, my friend," Republican presidential candidate Mitt Romney responded to hecklers at the Iowa State Fair on Thursday, as the candidate was questioned over his position on not raising taxes on individuals and corporations.
The quote has drawn condemnation from the Democratic Party, painting Romney as an out-of-touch candidate. Romney's comment raises another issue that has been dogging his campaign recently. You see, my friend, corporations are campaign donors, too.
Corporate donations are an increasingly big part of electoral politics since the Supreme Court's Citizens United decision, and subsequent court rulings, freed corporations and unions to spend money on independent campaigns. According to a HuffPost analysis, corporations have given $16.8 million to Super PACs, political committees that can receive unlimited contributions from individuals, corporations and unions and that are required to report their donors. The amount of corporate money donated to political nonprofits is unknown, as these committees can raise unlimited corporate money without disclosing it to the public.
The majority of that $16.8 million has gone to two Super PACs, the Karl Rove-linked American Crossroads, with $8 million in corporate donations, and the pro-Romney Restore Our Future PAC, with $3.5 million in contributions from corporations. Corporate donations account for more than a quarter of the total contributions to each of these committees.
"We are just seeing the beginning of what could turn out to be an onslaught of corporate money being injected into our congressional and presidential campaigns," Democracy 21 President Fred Wertheimer told The Huffington Post. "The Citizens United decision has opened up Pandora's Box here."
The Campaign Legal Center's FEC Program Director, Paul S. Ryan, previously told The Huffington Post, "There's a big difference between humans and corporations that the Supreme Court ignored in their Citizens United decision."
The Legal Center and Democracy 21 have been at the center of the corporate contributions controversies surrounding the pro-Romney Super PAC Restore Our Future. The two reform groups filed a complaint calling for an investigation into the alleged $1 million donation from the short-lived corporation W Spann's to the pro-Romney group.
The reform groups are now calling for an investigation into two other obscure corporate donations to Restore Our Future, Eli Publishing and F8, LLC, for making contributions in someone else's name.
"The enforcement agencies need to send a clear message to donors that they need to put their name on the check if they're going to be giving to Super PACs and I hope that reporters are taking a close look at filings by other Super PACs so that these types of abuses are smoked out," the Campaign Legal Center's Ryan said in a statement. "The fact that Restore Our Future has been the recipient of all three mysterious $1 million contributions warrants exploration of the PAC's knowledge of or involvement in this 'straw company' donation scheme."
The Huffington Post previously reported that the Utah state business records show that Eli Publishing and F8, LLC are registered with one of the founders of the Provo, Utah-based marketing company Nu Skin Enterprises and a lawyer connected to the company.
Unlike human beings, corporate donors need only disclose the name of the company, which in the case of W Spann provided no public information, and for Eli Publishing and F8, LLC provides little immediate information. That problem extends to many of the other corporations giving to Super PACs that also have relatively obscure names with little immediately available information on the humans behind the contributions.
2GIG Technologies, B/E Aerospace, National Label Company and R.P. Lumber Co. are just some of the obscure names that appear on Restore Our Future's disclosure report. The reports filed by American Crossroads and other groups also contain corporate names that have little distinguishing characteristics and are often subsidiaries of bigger companies.
"Any time that an opaquely named organization contributes to a committee, it makes it harder for the public to know who is behind that interest," Center for Responsive Politics spokesman Michael Beckel explained to The Huffington Post.
Beckel pointed to another issue that benefits corporations over human beings when they give contributions: "[T]he deep pockets that corporate treasuries bring to the table is not something that an ordinary citizen can bring."
Often those deep treasuries are being used by donors who are looking for ways to contribute as much as they can to their favored candidate. The rise of candidate-centric Super PACs provides big-time donors with an unlimited way to show their support for a presidential or congressional candidate. These donors can dip from their personal pockets or their corporate treasuries to double or triple donate in order to give a helping hand.
An ABC News report revealed that the majority of the money donated to the pro-Romney Restore Our Future and the pro-Obama Priorities USA Action Super PACs came from donors who had already donated the maximum amount to the campaign committees of their favored candidates.
The Supreme Court in the Citizens United ruling based its decision to allow corporate donations on independent expenditures on the assumption that these expenses do not raise a significant corruption concern.
"The justices tried to draw a distinction between a direct contribution and an independent expenditure," Beckel said. "But it turns out that these are the same donors."
These candidate Super PACs are multiplying at a rapid pace in the Republican presidential primary. Five have already emerged to support Texas Gov. Rick Perry's soon-to-be-announced bid, another supports Rep. Ron Paul (R-Texas), and Rep. Michele Bachmann (R-Minn.) now has one, too. All of these committees will be able to accept unlimited corporate contributions.
"For more than 100 years individuals and groups of individuals were permitted to finance our elections. Artificial entities like corporations were forbidden from doing so," Wertheimer said. "In one fell swoop, corporations were injected into our political system with their trillions of dollars in resources."
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First Posted: 08/11/11 07:40 PM ET Updated: 10/11/11 06:12 AM ET