Op Ed: California can shine a light on national ‘dark money’ in campaigns

Daniel Newman | February 04, 2013

The disastrous Citizens United Supreme Court decision three years ago unleashed a flood of political money unprecedented in U.S. history. Organizations can now raise and spend unlimited amounts of money to influence elections, without disclosing where that money came from. These "dark money" groups spent hundreds of millions of dollars nationally to influence November's elections.

In California, this dark money poured into campaigns for California's congressional representatives, and for state ballot measures. Most notably, a group called Americans for Responsible Leadership spent $11 million to influence Propositions 30 and 32 -- without disclosing its donors. Chairwoman Ann Ravel led California's Fair Political Practices Commission in a lawsuit against the group to pry free the basic civic information of who was funding their efforts to influence California elections.

The state's suit was successful, but only up to a point. Americans for Responsible Leadership was forced to reveal that it received the $11 million from a second group, the Center to Protect Patient Rights, which in turn received it from a third group, Americans for Job Security.

The donors to this third group are still secret today -- and the current law allows them to remain that way. Voters now know the nondescript names of three secret groups that funneled money -- but are still in the dark about who really influenced California's ballot measures.

Citizens United also freed corporations to spend unlimited amounts to influence elections. The public doesn't know the extent of corporate spending on elections, because the law currently allows corporations to keep their spending secret. Consumer-facing corporations, sensitive to public perceptions of political influence, are able to hide their political spending by financing trade associations, like the U.S. Chamber of Commerce, that do not have to disclose their donors.

And we certainly can't rely on corporations to voluntarily self-disclose. In a public statement to its shareholders, the insurance giant Aetna promised to be transparent about its political spending. Then, it accidentally revealed in a year-end regulatory filing that it contributed $4.5 million to the Chamber of Commerce to influence elections -- a mistaken disclosure that it promptly deleted from its public filing.

Congress will not be acting to reveal this secret money anytime soon. Republicans in Congress will continue to block the DISCLOSE Act and similar sunshine attempts, because the dark money overwhelmingly benefits them.

In November's elections, 85 percent of dark money supported Republicans, according to research from the nonpartisan Citizens for Responsibility and Ethics in Washington.

In California, we can ourselves take major steps that will unmask some of this secret money nationally, leveraging our position as the nation's most populous and most influential state. These three California proposals, if implemented at the state level, would reveal dark money across the nation:

First, the state could make use of its tremendous purchasing power to require that companies contracting with the state disclose all their political contributions -- national, state, and local. It's bad enough that government contractors contribute to politicians who can help them win contracts. We citizens should at least know what these contributions are.

Second, California could require that all companies doing business in the state disclose all their political contributions -- national, state, and local. As the eighth largest economy in the world, California can use our economic size to leverage the political transparency that is critical for our democracy.

Third, California could require disclosure of every entity making major contributions to the type of "pass-through" dark money groups implicated in the $11 million political money-laundering case. California could require the disclosure not just of the generic name of an organization, but of all the organization's major donors, if the organization's money was spent on California elections. This change would mean that, in the case of the laundered $11 million, all three dark money groups that touched the funds would have to disclose all their major donors, opening up a window into these groups' funding sources nationally.

Reforms such as these are well within our grasp. In both chambers of the California Legislature, there have been proposals for legislation, such as the California Disclose Act (SB 52) in the current session, which would bring greater accountability to our elections. What we need now, though, is to move beyond mere proposals.

The California public is disgusted with our broken system of money-dominated politics. Any or all of these three changes made by Sacramento lawmakers would shine a bright light on dark money nationally, while endearing their legislative champions to the California public.

Daniel G. Newman is co-founder and president of MapLight, a nonpartisan research organization revealing money's influence on politics. He is a 2011-13 network fellow at the Edmond J. Safra Center for Ethics at Harvard University.

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