Campaign finance is dead. Long live campaign finance


The Mitch McConnell campaign—which refers to itself by the parody-proof name “Team Mitch”—posted this video on YouTube last week. As you may have noticed, it contains no diegetic sound. There’s a weirdly contemporary electropop soundtrack, but at no point to do events in the video sync up with a particular element of the soundtrack or even narrative. It’s just footage of McConnell signing papers, turning alarmingly to the camera, shaking hands with a man in a tam and goatee whose vote cancels out yours, et cetera. You can dub whatever sound you want over this video, which, as The Daily Show has pointed out, makes it hilarious. It also makes it a free source of McConnell footage for whatever 501(c)4 organizations might want to produce ads to support him—but not coordinate with his campaign, since that is forbidden by law.

Thus we move merrily into the second election cycle of the post-Citizens United world. Under section 501(c)4 of the federal tax code, so-called social welfare organizations can spend as much money as they want to support a particular candidate, so long as they do not coordinate with that candidate’s campaign.

It’s not a complete obliteration of campaign finance restrictions. McConnell can’t accept unlimited money from, say, Citigroup. But if Citigroup wants to donate unlimited money to a 501(c)4 organization that happens to spend it all on its own completely original ad campaign in support of McConnell using free footage the candidate left on the internet, that’s fine—as long as they don’t coordinate.

As McConnell’s extraordinarily gutsy release of B-roll suggests, the line between support and coordination is legally hard to determine. Consider the case of former Utah attorney general John Swallow, who resigned in November amid allegations of corruption.

According to investigators, Swallow’s campaign manager set up a network of 501(c)4 organizations that funneled hundreds of thousands of dollars from payday lenders to the campaign. Swallow had once served as a lobbyist for Check City, a payday loan company whose founder became a sort of personal hero to him.

As Utah’s attorney general, Swallow would have broad authority to enforce rules made by the Consumer Financial Protection Bureau pertaining to lenders in the state. He turned to payday lenders in Utah and around the country to support his campaign, writing to one Tennessee executive to say that “I look forward to being in a position to help the industry as an AG following the 2012 elections.”

That’s not the sort of position that endears a prosecutor to the voting public. The beauty of Swallow’s network of 501(c)4’s is that it allowed one organization to donate money to another, so that contributions from payday lenders became virtually untraceable. Money for pro-Swallow ads and donations to his campaign came from groups with names like Utah Prosperity Foundation and The Proper Role of Government Education Association.

The series of nonprofits supporting the Swallow campaign were essentially a money laundering machine. Donations came in from payday lenders across the company, and they came out as ads and support from anodyne-sounding prosperity and education charities. The network of 501(c)4’s his Swallow’s campaign finances from the IRS, and it hid his backers from voters in Utah.

Perhaps Swallow might not have won the Republican primary if voters knew that his candidacy to enforce laws governing payday lenders was supported almost entirely by payday lenders. Money does not translate to votes, but it’s hard to see this simultaneous influx of out-of-state cash and deception of the public as anything but a reduction in the power of Utah voters.

The law prohibits coordination between 501(c)4 organizations and the campaigns they support, but what’s coordination? We all know it when we see it, but the law does not. The grotesque beauty of so-called “dark money” groups like the ones Swallow created is that they hide coordinators from the public eye. Voters don’t know where the money comes from, and campaigns aren’t telling—thus reducing oversight of coordination to the myopic gaze of the courts.

Meanwhile, McConnell releases a two-minute video of himself silently working. He’s not sharing footage with advertisers, because that would be coordination. He’s just releasing a campaign video that is utterly risible by normal standards, and which will not air in any of the standard places.

If someone wants to make their own pro-McConnell ad, who is he to stop them? He’s just going to leave some money on the dresser, and if you happen to pick up on the way out, that doesn’t mean either of you is engaged in prostitution. Thus do our lawmakers obey the letter of the law and twist the spirit in the extreme, so they can get re-elected and make more laws.



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