Sunlight Foundation

'Back to the Source': Colbert Super PAC Leads FEC Reporting, Gingrich Campaign and Others Follow

Super PACs have been a hot topic in the news recently as reporters, advocacy groups, and the public try to follow the money flowing into the political system as the 2012 elections approach.

On January 31st MSNBC reported that Stephen Colbert's super PAC, Americans for A Better Tomorrow, Tomorrow, was the first to submit its end-of-year report to the Federal Election Commission. The deadline for these reports was January 31st.

Colbert included his super PAC's filing on his super PAC's website, ColbertSuperPac.com, but this is not required. This kind of information can generally be found on the FEC website under Campaign Finance Reports and Data, but you have to know exactly what you are looking for.

The FEC portal includes a variety of search tools, including a searchable database of disclosure reports, downloadable copies of electronic filings, images of all financial reports, and other campaign finance data. However, these search tools suffer from a lack of a user-friendly interface. Several organizations, including the Sunlight Foundation, ProPublica, and the New York Times, have taken FEC data and put it in more user-friendly formats while focusing on information most relevant to the upcoming presidential election.

A search for Colbert's super PAC using the FEC's Disclosure Database search tool returns 13 filings, including the Year-End report displayed on Colbert's super PAC website. This report indicates that the super PAC has raised $825,475.46 since July 2011 and spent $151,521.01 as of December 31, 2011.

TPM published an article as the FEC deadline approached as well that focused on Newt Gingrich's campaign filing. The article cited several specifics regarding Gingrich's campaign spending, all of which are publicly available using the same online FEC portal. A search for "Newt 2012," the official name of Gingrich's presidential election campaign, under the "View Images of All Financial Reports" tab returns a list of documents filed. Viewing the PDF of the Year-End report shows all the numbers used in the article mentioned above.

It is necessary to emphasize again that these tools can be extremely hard to use, and you have to be very precise in your search terms. For example, a search for "Gingrich" using either search tool will return many results for other organizations related to Gingrich, such as "Friends of Newt Gingrich," but it will not return other better options.

The TPM article stated that the campaign had $2.1 million at the end of 2011 and owed over a million dollars in debt. The top level summary on page two of the Year-End report shows the $2.1 million the campaign has in cash and the $1.2 million it currently owes.

The article specified that the campaign's debt includes $1,666.66 to Rick Tyler - a former Gingrich aide who currently manages a super PAC in support of his candidacy. A search for "Rick Tyler" shows the $1,666.66 the campaign owes this former Gingrich aide on page 5166.

The debt also includes $350,000 for private jet flights. A search for "Moby Dick Airways," the private jet company that it has been reported Newt Gingrich uses, shows that the campaign began the quarter owing $451,946, incurred an additional $33,008 in charges this quarter, then made a payment of $133,008 to conclude 2011 with an outstanding balance of $351,946.

Lastly, the article says that the campaign paid $47,005 to Gingrich to buy a mailing list. A search for "Newt Gingrich" shows the campaign's $47,005 disbursement to the candidate for the express purpose of "list purchase" on page 4954.

Policy Fellow Matt Rumsey helped with the research for this post.


‘Back to the Source' takes a news article that makes good use of data and investigative techniques and tries to determine whether the underlying data that made the piece possible is publicly available. If you’d like to know where the data behind a particular piece can be found, please feel free to send us an email at mbuck@sunlightfoundation.com.

Sunlight on #superPACs: Colbert edition

In case you missed it, last night some-time South Carolina Presidential candidate and super PAC founder Stephen Colbert gave a great rundown of the new campaign finance landscape in our elections. Colbert and his team of very sharp writers have smartly illustrated just how out of control our campaign finance system is. In short, it’s crazy: A handful of billionaires pouring incredible amounts of cash is fundamentally changing what our democracy looks like. Colbert’s team doing a great job making sure this news gets outside the Beltway. Watch the video here:

The Colbert Report Mon - Thurs 11:30pm / 10:30c
America's Biggest Super PAC Donors
www.colbertnation.com
Colbert Report Full Episodes Political Humor & Satire Blog Video Archive

As you’ll see above, Colbert makes the point that these billionaires are doing this out in the open. There’s a little bit of truthiness to that. Yes, super PACs disclose their donors, but there’s plenty we don’t know. That’s because the FEC has done absolutely no work to regulate this new influx of cash. And neither Congress nor the FEC has had the guts to require the real-time, online reporting that would give the public an actual sense of who’s trying to influence their votes. After all, we only just got the super PAC disclosures from last year (!) on Tuesday, and many of the crucial primary elections are already over -- the Republican field is down to just a few left standing. It might have been helpful for voters in those early primary states to know just who was trying to influence them before they cast their votes. And although it’s great that we can name the top 22 donors, there may still be other billionaires who are funneling their money to super PACs through 501c4s, nonprofits which don’t have to tell anyone who their funders are.

Sunlight’s been working on this issue for a while, so we’ve got plenty of info if you’re interested. (Who doesn’t love a little campaign finance disclosure to spice up your Friday?) Our one stop shop for everything you ever wanted to know about super PACs but were afraid to ask is here: http://sunlightfoundation.com/superpacs/. We’ll be continuously updating that page, so make sure to bookmark it and come back.

We also have draft legislation that we think can solve many of the disclosure problems around super PACs, the SUPERPAC Act. We’re writing it out in the open (the way we wish Congress would write legislation) and we welcome your feedback to make it stronger. You can comment on any particular section or on the whole thing. Check it out: http://publicmarkup.org/bill/superpac-act/

The SUPERPAC Act hasn’t been introduced, yet, but it certainly wouldn’t hurt for you to get in touch with your representatives and let them know they should be on the side of transparency, which they could do simply by introducing and/or cosponsoring this legislation.

You can also read more about it, like -- Lisa’s blog post that Colbert showed on-screen and Lee’s analysis of the 22 donors that gave 48% of the presidential super PAC money (with fun charts!).

Our reporting group has also been spending some late nights going through the documents released Tuesday -- and they’re the ones who are tracking the spending so we can give you detailed data.

Want to help shine a light on super PACs in your area? We’ve also got the super PAC sleuth project -- you can check to see if there’s a super PAC in your area, take a picture, and upload it -- and if you want to dig in even further, you can join our Little Sis group, too.

It’s not enough to hope that the 22 billionaires that we know about pick someone we like for our next president (or representative, or senator -- super PACs aren’t limited to presidential contests). It’s up to us to demand transparency and make sure that everyone knows just who is trying to influence our elections.

On FIRE: How the Finance, Insurance and Real Estate Sector Drove the Growth of the Political One Percent of the One Percent

This piece was prepared in collaboration with Ethan Phelps-Goodman.

In the last two decades, finance, insurance, and real estate have made many individuals quite rich, propelling them to stratospheric levels of wealth.

It’s also propelled these individuals into stratospheric levels of political giving. More than any other industry, individuals from the finance, insurance, and real estate (FIRE) sector, particularly those in securities and investments, are the key drivers of the overall growth of elite donors, or The Political One Percent of the One Percent.

An analysis of campaign contribution records by the Sunlight Foundation reveals that the number of donors in the FIRE sector giving at least $10,000 (in 2010 dollars) per cycle to political candidates, parties, and independent expenditure groups has increased from 1,091 in 1990 to 5,510 in 2010 (a 405% increase). These elite FIRE sector donors’ combined contributions have increased even more dramatically, growing by $162.8 million (a 700% increase, controlling for inflation) to $178.2 million in 2010.

As we detailed last month, individuals spending more than $10,000 on elections now contribute one quarter of all individual campaign contributions – even though they are less than one percent of one percent of the U.S. population. We dubbed these elite donors Political One Percent of the One Percent.

Nowhere, however, has the growth in elite spending been more dramatic than in the finance, insurance, and real estate  sector.

In 1990, 1,091 elite donors in the FIRE sector contributed $15.4 million to campaigns – a substantial sum at the time. But that’s nothing compared to what they contribute today. In 2010, 5,510 elite donors from the sector contributed $178.2 million, more than 10 times the amount they contributed in 1990.

The outsized expansion of the finance sector as a source of major contributions makes some sense, given the increasing wealth of an already wealthy sector.

The financial sector is now 8.4% of the domestic economy, a percentage that has been steadily growing for decades, and is up from about 6% in 1990. But even faster than has been the growth in compensation in the industry. In 1990, industry employees took home $244 billion, according to the U.S. Commerce Department; Compensation in the industry is now almost double the average U.S. compensation, and at one point in the 2000s, the industry accounted for almost 40% of U.S. business profits.

Figures 1 and 2 below detail the changes in absolute dollar contributions since 1990, charting presidential and mid-term election years separately (since presidential years generally have twice the giving, the time trends are easier to see this way). What jumps out in the figures is how dramatically the FIRE sector is leaving everyone else behind. Figures 3 and 4 detail the growth in the number of donors from the FIRE sector as compared to other sectors. Again, we can see them pulling away.

As we can see, the finance sector was always a leading source of campaign funding. But over time, the gap between finance and other industries has grown into a chasm.

In 1990, the next most generous sector, lawyers and law firms, was home to 472 donors contributing $5.7 million (as compared to 1,091 elite donors from the finance sector contributing $15.4 million). By 2010, there were 2,211 elite lawyer donors contributing $59.6 million (as compared to 5,510 elite FIRE donors contributing $178 million)

Put another way, what began as an edge of 619 donors and $9.7 million for finance over law in 1990 grew into an edge of 3,299 donors and $118.4 million by 2010.

None of this is to minimize the increasing contributions by other leading sectors. Lawyers have likewise stepped up in impressive ways, also increasingly distancing themselves from the rest of the pack as key sources of big money. The Communications and Electronics sector has also shown impressive absolute growth in this area, driven largely by high-tech and Hollywood money. But the finance sector towers over everyone else.

Figure 1.

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Figure 2.

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Figure 3.

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Figure 4.

Pin It Digging a little deeper into the financial sector reveals that the growth in finance is mostly in the securities and investment part of the sector, followed by real estate. In 1990, 412 of the 1,091 elite donors from the finance industry came from the securities and investment industry, followed by 328 from real estate; by 2010, it was 2,178 from securities and investments, followed by 1,468 from real estate. In 1990, elite donors from securities and investments contributed $6.1 million and elite donors from real estate contributed $4.6 million. In 2010 elite donors from securities and investments contributed $84.0 million, while real estate donors contributed $44.5 million.

Looking at the historical distribution of finance money, it has consistently been bipartisan, going to candidates and committees from both parties, though slightly favoring Republicans in most years. In 2010, the industry gave 54% of its candidate/party money to Republicans. In 2008, 51% of the money went to Democrats.

Figure 5.

Party committees have been the biggest recipients of this money (53% of total contributions in 2010, 76% in 2008), then individual candidates (37% of total contribution in 2010, 21% in 2008) then independent expenditure groups (10% of total contributions  in 2010, 3% in 2008).

Individuals can now give up to $5,000 per candidate ($2,500 in both the primary and the general), to $30,800 to a party committee, and unlimited money to independent expenditure groups such as SuperPACs. Though these big-ticket donors have historically given less to independent groups, there is plenty of room for them to grow their contributions. In 2010, FIRE donors gave a historical high of 10% of their contributions to these independent groups, indicating that they are starting to catch on to their potential.

Cycle Candidates Parties IE Groups
1990 39% 55% 6%
1992 27% 71% 2%
1994 33% 62% 5%
1996 14% 84% 2%
1998 19% 74% 7%
2000 16% 81% 3%
2002 19% 75% 6%
2004 27% 69% 4%
2006 32% 59% 8%
2008 21% 76% 3%
2010 37% 53% 10%
CONCLUSIONS

Less than one percent of one percent of all Americans account for one quarter of all individual campaign donations. These elite donors all contribute at least $10,000 per election cycle, giving money to multiple candidates, party committees, and sometimes independent expenditure groups.

Within this select community of elite donors, individuals who work in the finance industry play a particularly special role. Of the $774 million in individual contributions given by this class of elite donors in 2010, $178 million (23%) came from elite donors in the finance, insurance and real estate sector. Perhaps more importantly, the ranks and total contributions from these donors have grown more dramatically and substantially than any other sector.

Though it’s very difficult to directly measure the influence that finance and other elite donors are having, it seems fair to say that, to the extent that candidates and parties are eager to court these donors, they will want to keep them relatively happy, since they know that without the support of these donors, raising the money needed to compete electorally is more difficult. At the very least, candidates and party leaders will be spending more time with these financial sector donors than anybody else, hearing them out sympathetically on regulation, taxation, and other issues of concern, again and again. At the aggregate level, it's hard to imagine this not having some impact.

Will Super PACs Determine the 2012 Election?

The Advisory Committee on Transparency is hosting an event, "Will Super PACs Determine the 2012 Election? Should they be more transparent?" on Monday, January 23rd at 2:15 p.m. in Rayburn 2203.

Super PACs have fundamentally changed the relationship between money and politics, and all too often are misunderstood. These new vehicles for political advocacy have upended traditional political alliances, infused tremendous amounts of undisclosed (or partially disclosed) money into the political system, and kicked off controversies over what our 21st century democracy should look like.

We are pleased to present the preeminent experts who will discuss what the public knows -- and should know -- about Super PACs, including the reporter who coined the term “Super PAC” and leading advocates on both sides of the transparency question. We will explore the legal limits of what can be disclosed about Super PACs, and the policy questions around what the public has a right to know.

Panelists:

  • Eliza Newlin Carney: Staff Writer for CQ Roll Call covering the issues of lobbying and influence
  • Allen Dickerson:Legal Director and Interim Executive Director of the Center for Competitive Politics
  • Mimi Marziani: Counsel for the Democracy Program at the Brennan Center for Justice at New York University School of Law
  • Paul Ryan: FEC Program Director and Associate Legal Counsel at the Campaign Legal Center
  • Daniel Schuman: Policy Counsel at the Sunlight Foundation and Director of the Advisory Committee on Transparency

We hope you can join us. Please RSVP to http://snlg.ht/RSVPSuperPAC

The Advisory Committee on Transparency educates policymakers on transparency-related issues, problems, and solutions and shares ideas with members of the Congressional Transparency Caucus. It hosts events to discuss important and wide-ranging transparency policy issues with experts from a variety of backgrounds and develops educational publications and provides timely information to the public and members of Congress. Learn more at http://transparencycaucus.org.

The Political One Percent of the One Percent

This piece was prepared in collaboration with Ethan Phelps-Goodman.

If you think wealth is concentrated in the United States, just wait till you look at the data on campaign spending.

In the 2010 election cycle, 26,783 individuals each contributed more than $10,000 to federal political campaigns. Combined, these donors spent $774 million. That's 24.3% of the total from individuals to politicians, parties, PACs, and independent expenditure groups. Together, they would fill only two-thirds of the 41,222 seats at Nationals Park the baseball field two miles from the U.S. Capitol. When it comes to politics, they are The One Percent of the One Percent.

A Sunlight Foundation examination of data from the Federal Election Commission and the Center for Responsive Politics reveals a growing dependence of candidates and political parties on the One Percent of the One Percent, resulting in a political system that could be disproportionately influenced by donors in a handful of wealthy enclaves. Our examination also shows that some of the heaviest hitters in the 2010 cycle were ideological givers, suggesting that the influence of the One Percent of the One Percent on federal elections may be one of the obstacles to compromise in Washington.

Read more

The Occupation of K Street: Lobbying, Citizens United and the need for reform

Earlier today, protestors from OccupyDC headed over to the offices of the Podesta Group, a high profile lobbying firm, before joining hundreds (possibly thousands) of other Occupy protesters from across the U.S. in shutting down K Street. There's another #occupy protest planned at the Supreme Court, highlighting the January 2010 Citizens United v. FEC decision.

As we’ve written before, we’re excited to see a grassroots movement forming that addresses such wonky issues as campaign finance and lobbying reform. We hope that the Occupy protesters’ concerns on those issues don’t get lost in the coverage of the more colorful aspects of today’s actions. While the Occupy movement has become famous in part for its alleged lack of clear demands, we hope that the media coverage of the protests today highlights the need for real reform to bring transparency to lobbying and campaign finance.

K Street is (in)famous for being the epicenter of lobbying in Washington. In fact, the #OccupyDC group in McPherson Square also calls themselves @OccupyKSt, because ‘the money from Wall Street flows to K Street,’ disproportionately influencing the government. It’s no secret that there’s quite a bit of money around K Street -- we actually mapped the top lobbying firms when we did a teach-in at OccupyDC a while back.

The reality, though, is that we don’t even know where all the money is. For example, loopholes in lobbying registration rules mean that unless you spend 20% or more of your time lobbying, you don’t have to register. So powerful figures, including former congressmen -- like former Senator Dodd who now heads the movie industry’s lobby, or "historians" like former Speaker of the House Newt Gingrich -- do not have to register as lobbyists. Which means we can't track their activity. It also means that, in effect, we rely on lobbyists to uphold an honor code of registering when appropriate. That's not a good recipe for public oversight. Sunlight’s been advocating for serious lobbying reform for years -- you can learn more (and join us!) here: http://sunlightfoundation.com/policy/lobbying/

Lobbying disclosure, of course, has been a problem since long before Occupy. The public has a right to know how special interests and lobbying help shape public policy—for better or worse. But it’s getting harder for us to get that information.

Last January, the Supreme Court decision Citizens United v. Federal Election Commission drastically changed the landscape of our election system by allowing corporations to make unlimited campaign ads—often without disclosing the donors who funded the ads. In the wake of that decision, the FEC has done next to nothing to create transparency, and the DISCLOSE Act, a piece of legislation intended to create disclosure in the wake of Citizens United, failed in the last Congress.

If Congress, the Supreme Court and the FEC are going to make it difficult to follow the money, then it’s imperative for watchdogs and journalists to follow the action. When it comes to knowing who's wielding influence in Washington, that action is lobbying. After last year’s Citizens United vs. Federal Election Commission ruling, campaign finance and lobbying disclosure became even more closely linked. How? Lobbyists can—without ever saying a word—threaten that their clients will spend millions on ads if senators or representatives do not do what the lobbyist wants.

Imagine you’re a member of Congress. A lobbyist comes to you representing a powerful corporation and asks for your help on a bill provision. You’re not sure that bill provision best represents the interests of the people in your district, but the lobbyist points out that their client has a Super PAC that is willing to spend millions of dollars running ads in your district -- money that you can’t match. What’s more, because of how weak campaign finance disclosure laws are, that lobbyist might have an army of other corporations or wealthy individuals who also support the bill who could secretly funnel unlimited amounts of money to that Super PAC. What would you do?

Occupy Wall Street got the country talking about economic disparities and corporate accountability. We hope that today’s actions -- the Occupation of K Street -- fuels the conversation about money in politics and the need for reform.

Influence Explored: Coakely Sues Big, Influential Banks

Massachusetts Attorney General Martha Coakley filed a lawsuit yesterday against five major U.S. banks for violating the state’s laws to protect consumers by conducting unfair and deceptive practices during the foreclosure crisis.

The complaint claims that Bank of America, Wells Fargo, Citi, JP Morgan Chase and Co., and Ally Financial all committed violations of the state’s laws to protect consumer rights and damaged public records through faulty and fraudulent foreclosure proceedings, failing to modify home loans and the use of a system known as the Mortgage Electronic Records System (MERS).

Much of the outrage towards these banks and others stems from the money they received during the housing and financial crisis that began in 2008. All five of these banks received billions of dollars in emergency funds through the Troubled Assets Relief Program (TARP) to ensure their stability and keep them from failing. But now, after many citizens and politicians feel the banks haven’t reciprocated the concern the public and the government had for their financial troubles, they’ve found themselves in legal and political trouble, including this lawsuit.

The violations these banks are accused of committing come after a series of programs that were intended to help the banks help the people. Regularly, before and after those programs were put into place, these banks take part in influential tactics to keep their own bottom line on the minds of lawmakers and not necessarily the financial stability of the public through campaign contributions, lobbying and other less-expected and less-expensive ways.

According to InfluenceExplorer.com, contributions to candidates across the country affiliated with these five banks totaled nearly $14 million. However, only a rather insignificant portion of that money—$173,000—went to Massachusetts politicians.

Also according to Influence Explorer, Bank of America’s political action committee and its employees and their family members gave $4.8 million to state and federal candidates during the 2009-10 election cycle. Massachusetts Democrat Barney Frank received $25,000 of that money.

BofA also lobbied heavily on a variety of bills related to finance and other issues, spending $7.4 million during those same two years. BofA frequently disclosed lobbying on the Dodd-Frank bill—officially known as H.R. 4173, The Wall Street Transparency and Accountability Act of 2010. Presumably, the banking giant spent a great deal of that money to influence the formation and implementation of this bill, which was intended to regulate many banking practices that had no formal regulation before and threatened to significantly lower the profits a bank could rake in. The goal of that bill, according to lawmakers, was to make sure the country would never see a financial crisis like the one recently experienced again.

According to Federal Advisory Committee Act data also displayed on Influence Explorer, as of 2011, Bank of America has five employees sitting on federal advisory committees. Those employees are in the position to advise various agencies on how to implement regulations and do business, usually doing so on issues that affect their own business matters. Walter Muller, the bank’s Chief Investment Officer, sits on the Department of Treasury’s Advisory Committee of the Securities Industry and Financial Markets Association.

JP Morgan is a big spender in Washington as well. During the 2009-10 election cycle, there were $3.4 million campaign contributions affiliated with financial company. There were also $13.4 million in lobbying expenditures reported. Like BofA, JP Morgan reported lobbying heavily on the Dodd-Frank Financial Reform bill.

JP Morgan doesn’t currently have any employees on any federal advisory committees, but did in 2010 when the company’s Executive Director of Environmental Affairs sat on an advisory committee with the Department of Commerce.

If you’d like more influence data about these two companies, or the remaining three being sued by Massachusetts—Well Fargo, Ally Financial (formerly GMAC) and Citi—you can visit InfluenceExplorer.com and TransparencyData.com.

Part of the lawsuit has been brought about because the attorney general Martha Coakley doesn’t believe the banks have adequately satisfied promises to modify mortgages and slowdown the rampant foreclosures happening in the state. For information on that issue, see the report we did on the Home Affordable Modification Program (HAMP), which is a funded through TARP.

Lobbyist Bundler Data Includes Giving to Super Committee

Of the 12 members of the failed supercommittee that were tasked with cutting $1.2 trillion from the federal deficit, five have disclosed records with the Federal Election Commission stating that they’ve received bundled contributions from lobbyists exceeding $16,000.

Representative Dave Camp, R-Mich, is the only member of the committee that has reported receiving bundled contributions so far this cycle. All $32,000 he received was bundled by one lobbyist named Harry Sporidis. Sporidis works for the firm Polsinelli Shughart and represents a number of clients in the healthcare industry, including the National Association for Behavioral Health and the American Society of Clinical Oncology.

According to the records, Sen. Patty Murray, D-Wash, has been the greatest supercommittee recipient of bundled contributions since 2009. She’s received just over $262,000 from large corporations including AT&T, Microsoft, Boeing, and Amazon, and well-known lobbyists like Tony Podesta who represents many prominent clients like BP America, Credit Suisse and Boeing.

This information has been made available as a result of the Honest Leadership and Government Act of 2007, which amended the Lobbyist Disclosure Act of 1995. The act made gifts to lawmakers illegal, was supposed to close the revolving door and required more disclosure regarding lobbying activity and spending – including the disclosure of bundled contributions, among other things. The act came about after Jack Abramoff, the infamous lobbyist turned felon, was convicted of fraud, tax evasion and conspiracy. His case demonstrated the wide-ranging corrupt practices that could take place in Washington. The rules require disclosure of bundled contributions went into effect in 2009, and have so far generated a rather small dataset of just over 300 records but have revealed $17.1 million in contributions to just 76 recipients including party committees. The largest bundler, the Edison Electric Institute (EEI), has given $2,120,952 in bundled contributions to just two recipients. The Democratic Congressional Campaign Committee is one of them and received the bulk of that money: $2,072,950. The Republican Senator from South Carolina, Lindsey Graham, received the remaining $48,000 of that money. According to records filed with the Senate Office of Public Records, EEI has lobbied on a variety of issues related to energy, including regulating greenhouse gases and Clean Air Act regulations.

The remaining supercommittee members that received bundled contributions subject to the relatively new rules are Jeb Hensarling, R-Texas, Chris Van Hollen, R-Md, and John Kerry, D-Mass,. The three received $235,500, $40,000 and $20,425 respectively.

The lobbyist bundler data is now available on InfluenceExplorer.com and TransparencyData.com. The data comes directly from the FEC. Contributions are disclosed by recipients (reporting committees) to the FEC when a lobbyist/registrant or lobbyist/registrant PAC makes at least two contributions to a single recipient totaling at least $16,200. Recipients report according to their regularly scheduled reporting periods and according to biannual reporting requirements put into place just for bundled contributions, according to the FEC.

Van Hollen Lawsuit vs. FEC Sheds Light on Corporate Campaign Activity

Can corporations and labor unions hide how much money they spend on campaign-related ads by funneling money through other corporations that don't have to disclose the identities of the original donors? That question is at the heart of a lawsuit brought by Rep. Chris Van Hollen, who is challenging a Federal Elections Commission regulation that fatally weakened the donor disclosure requirement mandated by the Bipartisan Campaign Finance Reform Act (BCRA). The case is scheduled for argument on January 11th, 2012, before a D.C. federal district court.

Until 2007, federal law prohibited corporations (including non-profits and labor unions) from spending money on "electioneering communications" -- ads regarding a clearly identified federal candidate aired in the immediate run up to an election via broadcast, cable, or satellite communications. Federal law did not restrict the ability of private individuals to buy air time, but did require that an individual's identity be disclosed if $1,000 or more was spent. The Supreme Court opened the door to corporate electioneering communications in 2007 in FEC v. Wisconsin Right to Life, as long as corporations stick to issue ads and don't expressly call for the election or defeat of a particular candidate.

After the Court's decision, the FEC revised its regulations. How would existing law about disclosure of donations apply to corporations making electioneering communications?

The FEC decided to split the baby, requiring corporations and labor unions to disclose donations, but only when they were "made for the purpose of furthering electioneering communications." While reasonable-sounding, this regulation in effect has been a disaster for disclosure and undermined BCRA. Why not require corporations who make these expenditures to report all donors? (The law permits corporations to set up a special "segregated" fund from which funds can be drawn so they don't have to disclose all donations to the general treasury.) How can you tell what a corporation's "purpose" is? The FEC's swiss-cheese standard leaves plenty of room to circumvent Congress's intent.

According to the Van Hollen complaint, evasion is rampant. "Persons making 'electioneering communications' disclosed the sources of less than 10% of their $79.9 million in 'electioneering communication' spending." For example, the Chamber of Commerce spent $32.9 million in electioneering communications in 2010, but did not disclose a single contributor. A cottage industry has sprung up of corporations establishing nice-sounding non-profits through which they funnel money while anonymizing corporate campaign activity. The amount of dark money can only increase.

The court has an opportunity to address this problem, but ultimately Congress needs to look at strengthening disclosure requirements across the board.

Back to the Source: $52 Steaks on Menu as AT&T Feted Lawmakers During T-Mobile Push

Do you remember the AT&T/T-Mobile merger that dominated the news earlier this fall? It caused quite the stir in Washington, with numerous outlets reporting on AT&T's massive lobbying efforts to push through the merger. Bloomberg was one such news outlet, reporting a story of expensive steaks and 'lobbyist's libations' in early September. The story focused on the numerous swanky fundraisers AT&T was hosting as well as their generous campaign donations to key lawmakers.

This was undoubtedly a great investigative piece and involved a good deal of skilled journalism. Using this article as a guide, however, it's possible to see how any of us - or you - could do a similar investigation.

Fundraisers

The article begins describing the lavish fundraisers AT&T had been hosting for lawmakers, citing Sunlight's Party Time data.

  • "AT&T hosted at least nine fundraising receptions and dinners since the deal was announced on March 20."
  • One of which was held at Charlie Palmer Steak, where "AT&T and one of its outside firms, Akin Gump Strauss Hauer & Feld LLP, shared hosting duties for a June 14 fundraising dinner for Representative Henry Waxman, of California."
  • Another was held at BLT Steak. The article says it "was the scene of a June 21 fundraising dinner hosted by AT&T for Representative Peter Roskam, an Illinois Republican who sits on the tax-writing Ways and Means Committee."

Sunlight's Party Time data is free and available for anyone to use. We manually collect fundraiser and event invitations and put them online. They are searchable by a variety of of criteria including committee, leadership PAC, beneficiary, host, and venue.

For example, a PartyFinder search for "AT&T" as a "Host" returns a list of all the fundraisers hosted by AT&T's Federal PAC. The most recent one was September 20th. A PartyFinder search for "Charlie Palmer Steak" as "Venue Name" returns a list of all the fundraisers held at the restaurant mentioned in the article. It's a popular locale - already three fundraisers are scheduled to be held there next month.

Campaign Donations

The article makes a number of points that suggest AT&T exerted its political influence through campaign donations. The article notes the following, frequently citing data obtained from the Center for Responsive Politics:

  • "AT&T's political action committee gave $805,500 to federal candidates."
  • The company's PAC "was the most generous corporate PAC this year."
  • "House Speaker John Boehner, Majority Leader Eric Cantor, and Representative Fred Upton... each received $5,000 from AT&T’s PAC."
  • During the past year AT&T Senior Executive Vice President Jim Cicconi donated "$1,500 to Boehner, $2,000 to the National Republican Senatorial Committee, and $1,000 to the National Republican Congressional Committee."
  • Since 2009, AT&T Chief Executive Officer Randall Stephenson has donated "$2,000 to Boehner, $6,000 to the Republican senatorial committee and $4,000 to the Republican congressional committee."
  • "AT&T’s contributions this year have split 64 percent to Republicans and 36 percent to Democrats, compared with... 55 percent Republican and 45 percent Democratic in the previous election cycle."
  • "AT&T’s PAC has given Waxman $4,000 so far this year, and Akin Gump’s PAC gave him $1,200."
  • "Roskam received $3,500 from AT&T’s PAC."
These numbers can all be found using CRP data to look at money donated by AT&T's PAC, money donated to a specific candidate, and money donated by a specific person. CRP's "Donor Lookup" tool allows you to search for campaign contributions by individual donors or recipients. You can narrow the search by election cycle, state, donor occupation or employer, and zip code. Keep the search simple and broad to return maximum results and possibly identify donation patterns. For example, just typing "Stephenson, Randall" returns numerous instances of the AT&T executive donating to prominent Republican lawmakers as well as AT&T's PAC.

Similar results can be found using Sunlight's Transparency Data and Influence Explorer tools. TransparencyData allows users to sort through raw campaign finance records, while Influence Explorer shows polished lists of top contributors and recipients. Both tools also house other corporate accountability and regulatory datasets so users can get a big picture look at any corporation’s or individual’s influence in government.

Lobbying Efforts

The article notes that AT&T "boosted lobbying spending by 30 percent to $11.7 million in the first six months of 2011 compared with a year earlier" and that the company "supplemented its own in-house lobbyists with 18 outside firms pushing for the merger." The article specifically notes:

  • "The firm of former U.S. senators John Breaux [ ... ] and Trent Lott [ ... ] received $240,000."
  • "A company headed by former U.S. Representative J.C. Watts [ ... ] got $100,000."
  • "Former House Energy and Commerce Committee Chairman Billy Tauzin’s firm was paid $50,000"
  • "Wiley Rein LLP, a law firm [ ... ] co-founded by former Federal Communications Commission Chairman Richard Wiley, received $160,000."
  • "Clyburn Consulting LLC, where the principal [ ... ] a cousin to Representative James Clyburn [ ... ] received $60,000"
  • "Akin Gump received $240,000 this year to lobby on behalf of the merger and other issues."

Lobbying information can be found using CRP's Lobbying Database, which is searchable by client, firm, lobbyist, industry, issue area, agency, position, or bill. A search for "AT&T" as "Client" returns results providing AT&T's total lobbying expenditures by year, as well as an itemized list of lobbying expenses that indicates which lobbying firms were hired and how much they were paid. Narrowing by year shows that by Sept. 20, 2011, AT&T had already spent $11,690,000. The total for the entire previous year was $15,395,078.

Sunlight's Influence Explorer and TransparencyData also provide this lobbying data. Once again, TransparencyData displays the raw records while Influence Explorer displays lists and summaries of lobbyists hired and issues most frequently disclosed as lobbied on.

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‘Back to the Source' takes a news article that makes good use of data and investigative techniques and tries to determine whether the underlying data that made the piece possible is publicly available. If you’d like to know where the data behind a particular piece can be found, please feel free to send us an email at mbuck@sunlightfoundation.com.

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