Unmasking a Small Slice of Independent Corporate Spending in the 2010 Federal Elections

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Unmasking a Small Slice of Independent Corporate Spending in the 2010 Federal Elections

Disclosed Corporate Funds Behind Independent Spending Are a Fraction of What Is Hidden, Heavily Favor Republicans

WASHINGTON - Tapping into what few disclosure records exist of campaign spending
by outside groups in the 2010 elections, Public Citizen identified about
200 corporate contributors to a mere 29 independent groups that have
reported their funding sources to the Federal Election Commission (FEC).
These disclosure records account for a very small fraction of the
record-breaking campaign spending by outside groups this year, but they
confirm a widely suspected trend: Corporate money is heavily favoring
Republican candidates by 11-to-1.

 “The overwhelming majority of the corporate money flowing into the
2010 elections remains hidden from public view, laundered through scores
of outside electioneering groups that are refusing to disclose their
funding sources,” said David Arkush, director of Public Citizen’s
Congress Watch division. “Most of these groups claim to avoid triggering
registration and disclosure thresholds by steering clear of making
electioneering activity their major purpose - a claim that Public
Citizen is actively challenging in a series of complaints filed with the
FEC.”

  A few of the outside groups have declared that their major purpose
is to influence federal elections, which requires them to register
either as political committees or “independent-expenditure-only
committees” (known as Super PACs). Super PACs may receive unlimited
contributions from corporations, unions and individuals to pay for
independent expenditures, but they must disclose their donor sources to
the FEC on a quarterly basis (as well as on a 24-hour basis near the
election). It is from these reports that Public Citizen has gleaned a
snapshot of corporate political spending this year.

 Public Citizen’s analysis shows that among the 29 independent
electioneering groups that we have been able to identify as disclosing
corporate donors, 18 are buying ads primarily or exclusively favoring
Republican congressional candidates, 10 are promoting Democratic
congressional candidates, and one is exclusively supporting the
independent senatorial candidacy of Lisa Murkowski, who lost the
Republican nomination in Alaska’s primary election.

 Nearly $10 million in corporate contributions to these groups is
backing Republican candidates, almost $900,000 is backing Democratic
candidates, and about $1.8 million is supporting the independent
candidacy of Murkowski. The list of independent electioneering groups,
their corporate donors and the amount of corporate contributions is
available at http://www.citizen.org/documents/Snapshot-corporate-donors-chart-10282010.pdf.

 Among the largest corporate donors of $25,000 or more to the
independent spending groups, the contributors supporting Republicans are
dominated by the financial industry, followed by real estate,
agriculture and energy. The independent group supporting Murkowski’s bid
is funded primarily by Native American real estate interests. Although
the funding for Democratic groups from large corporate donors pales in
comparison to that of the Republican groups, casinos are a surprising
source of large donations for Democrats. All corporate donors of more
than $1 million dollars are supporting Republican groups through
American Crossroads, an organization launched by Republican strategist
Karl Rove.

 Smaller corporate donors range from automotive services to plumbing
companies to even the Jelly Belly Candy Co., which put $10,000 into a
Republican-oriented group.

 Yet it is important to remember that a vast amount of corporate
money is being poured into the elections, and the sources of that are
for the most part unknown. The U.S. Chamber of Commerce, for instance,
has said that it plans to spend $75 million this election, but its
donors are a mystery.

 “The decision to invest corporate funds in an election is almost
always solely that of the company CEO,” said Craig Holman, government
affairs lobbyist for Public Citizen. “In publicly held companies, the
CEO is under no obligation to get the consent of, or even inform,
shareholders of how she or he is spending their money on politics. This
is a new Wild West of unlimited and undisclosed corporate spending in
our elections.”

 The United Kingdom has long required that corporate CEOs inform
shareholders of political spending and receive shareholder approval for
corporate political expenditure budgets. There are no such safeguards in
the U.S.

 Public Citizen continues to call for passage of the DISCLOSE Act to
lift the veil of secret money in elections; approval of the Shareholder
Protection Act to mandate that shareholders be duly consulted in
decisions of corporate political spending; passage of the Fair Elections
Now Act to provide candidates with sufficient public funds to respond
to corporate-sponsored attack ads; and ratification of a constitutional
amendment to clarify to the U.S. Supreme Court that corporations should
not be treated as people under the First Amendment. The court in its
January decision in Citizens United v. Federal Election Commission gave
corporations the green light to spend as much money as they want to sway
elections.

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Public Citizen is a national, nonprofit consumer advocacy organization founded in 1971 to represent consumer interests in Congress, the executive branch and the courts.

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