As the Nov. 8 midterm election draws near, a campaign finance expert warns that “dark money is a growing issue” in America’s elections.
According to former prosecutor, campaign finance expert and
Save Democracy in America founder Dan McMillan J.D., Ph.D., “dark money is a growing issue” in America’s elections. Dark money refers to campaign contributions whose sources are not disclosed. While expenditures such as pricey campaign ads attacking an opponent may be reported to the FEC, the identities of the people, firms, and activist organizations that pay for those ads are often hidden.
“Dark money is spent to influence our elections but we have no idea who the donor is,” McMillan, author of “Get Money out of Politics. The Time is Now,” told The Epoch Times. “It’s bad enough that our government has been for sale to high-dollar campaign donors for decades but now we don’t even get to know who is behind a particular politician or political party.”
According to McMillan, the largest funnel for dark money is 501 (c) (4) groups.
Such
501(c)4 organizations—which include political campaigns and groups that advocate for certain issues—are exempt from federal taxation.
However, contributions and donations made to them are not tax-exempt. To qualify for 501 (c) (4) status, all of the organization’s earnings must be used for social welfare purposes.
As McMillan explained, as long as they don’t identify themselves as a political organization and don’t spend more than 50 percent of their resources on political activity, they don’t have to disclose their donors. But even that limit is easy to evade by using the money for something they'll call “educational work” or “membership building.”
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Issue ads“ are a favorite new way for 501 (c) (4)s to influence elections with dark money. Issue ads focus on issues, such as abortion or freedom of speech, rather than on the candidates themselves. While reporting on expenditures for TV and radio ads is not required until weeks leading up to an election, disclosures for online/social media advertising that avoids expressly advocating for an election outcome are not required at all. McMillan also noted that with the sheer volume of political ads on TV, radio, and every social media platform available, the IRS can’t possibly have enough dedicated resources to police them all.
“For the 2022 midterms we’ve seen the transition of dark money becoming darker,” McMillan said. “It’s a very big and scary problem.”
The Size of Dark Money
As McMillan noted,
Republicans took the lead in making use of dark money after the Supreme Court’s landmark
Citizens United v. FEC decision in 2010. But since then, “Democrats have more than caught up.”
What makes the 2022 election cycle more “ominous and upsetting” for McMillan is that more dark money is being spent while so much less is getting reported.
According to Open Secrets, the 2022 election cycle has already seen over $115 million in dark money contributions from and spending by 501(c) groups. However, they have reported less than $3 million to the FEC.
