Wednesday, November 7, 2012

Post-Election: 501(c)s & Political Spending

Os_logoWhile final figures will take a while to compile, an early Center for Responsive Politics report indicates that at least $300 million of the approxmately $6 billion spent this just competed election cycle came from tax-exempt, section 501(c) organizations that are generally not required to disclose the sources of their funds.  I say "at least" because the report (and likely most if not all future reports) only captures political spending reported to the Federal Election Commission or comparable state agencies because it is for express advocacy, electioneering communications, or other activities explicitly covered by federal or state election law disclosure requirements.  For a more detailed analysis of such spending in previous election cycles, including the limitations of the data available, see the Campaign Finance Institute.

National-Institute-on-Money-in-State-Politics-150x150Even though such spending may be a relatively small part of total election spending, it could have a disproportionate effect on election results because of the ability of such groups to target their spending on close races.  A National Institute on Money in State Politics report documents the spending patterns of 501(c)s and other independent groups with respect to California state elections from 2005 through 2010 (California not having a prohibition on corporate and union independent election spending even before the Citizens United decision), including how such groups tend to concentrate their spending on specific races. 

It is also important to note that while media reports have tended to focus on the conservative-leaning, newly created section 501(c)(4) social welfare organizations such as Crossroads GPS, the above report on this year's spending also shows significant spending by established entities ranging from the U.S. Chamber of Commerce to the NRA to Planned Parenthood (Action Fund, I assume).  Even more strikenly, the above report on past spending in California shows the largest spenders to be almost all unions, which are presumably left-leaning generally. In other words, it is far from clear that the perceived conservative advantage in such spending will be maintained in the long run.

LHM

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