527s and their role in the election
Lately, we’ve been hearing a lot about so-called “527s,” political action organizations named for the tax code under which they fall.
In opting out of public financing last week, Barack Obama said: “John McCain’s campaign and the Republican National Committee are fueled by contributions from Washington lobbyists and special interest PACs. And we’ve already seen that he’s not going to stop the smears and attacks from his allies running so-called 527 groups, who will spend millions and millions of dollars in unlimited donations.”
Donklephant opines: “Numerous conservative 527s will be attacking Obama, and McCain has already signaled that he’s essentially throwing up his arms and saying, “Hey, not much I can do.”
So, the underhanded smear tactics of the 527s are primarily a creation of the right-wing, right?
Not so much so, no.
Consider OpenSecrets.Org’s tally from the 2004 election cycle, when George W. Bush defeated John Kerry. The biggest spender among 527s that cycle was America Coming Together, a liberal organization that was later fined $775,000 by the FEC for violating campaign finance laws. Since disbanded, ACT spent more than $78 million during the election cycle.
Next on the list, and close behind ACT, was Joint Victory Campaign 2004, another Democratic organization. It was started by ACT to fund both ACT and The Media Fund. Like ACT, it was founded by former AFL-CIO CEO Steve Rosenthal, with George Soros as one of its biggest donors. Joint Victory Campaign 2004 spent just over $72.5 million in 2004.
And third on the list was The Media Fund, the third part of the ACT umbrella. Founded by Harold Ickes, Bill Clinton’s White House chief of staff, The Media Fund aired ads in Democrat battleground states, spending a total of some $57.5 million.
Fourth on the list was the Service Employees International Union, a federal PAC. Headed up by Andy Stern, a contributor of The Huffington Post who has become increasingly politically-motivated since the 2004 election cycle, the SEIU is the nation’s largest health care union. The SEIU endorsed Howard Dean in his failed Democratic primary bid, and spent more than $47.5 million in the 2004 election cycle.
Rounding out the top 5 highest-spending 527s in the 2004 election cycle was Progress For America, and finally we have an organization associated with Republicans. Progress For America spent just over $35.5 million in the 2004 election cycle.
Taking a look at the 2nd 5, we find Swift Boat Veterans for Truth ($22.5 million), a Republican-affiliated organization; MoveOn.Org ($21.5 million), which I think needs no explanation; the College Republican National Committee ($17 million); the New Democratic Network ($12.5 million), a Democratic-affiliated 527; and Citizens For A Strong Senate ($10.2 million), also a leftist-affiliated organization.
I don’t think I need to do the math for you. For his part, Obama has been distancing himself from 527s, and has gone so far as to suggest that they not spend money on his behalf, which is figured to be part of the reason MoveOn.Org dumped its 527 status last week (though, as Politico’s Ben Smith notes, MoveOn’s 527 had been dormant since the ‘04 election cycle, meaning their move was largely a PR stunt on Obama’s behalf).
But it’s all part of the political game, this posturing about who 527s are or are not benefitting. If you listen to the rhetoric, it appears that the 527 efforts of the ‘04 campaign are behind us, and the 527s of the ‘08 election cycle will benefit only McCain, who won’t try to stop the 527s, while Obama takes the high road by encouraging the 527s not to spend on his behalf.
But, again, not so much so. Candidates have no control over 527s. Obama knows this as well as McCain. Furthermore, these right-wing 527s that Obama cites as reason for opting out of public financing (an excuse furthered by the New York Times, which editorialized: “Mr. Obama’s power to excite average donations of less than $100 also is admirable, and his concerns about his opponent are understandable. The Republican Party is raising a great deal of money, and shadow groups known as 527s have tens of millions to spend.”) do not exist, as Politico’s Jonathan Martin points out. Unlike 2004, when Kerry touted his military service and prompted the Swiftboat Veterans into the fray, there is no high-spending 527 working on behalf of McCain this election cycle.
So, again, a look at the numbers, this time for the 2008 election cycle. And we find that the biggest spender thus far (at just short of $16 million) is the left-leaning Service Employees International Union. Following second, at $11.2 million thus far, is America Votes, another leftist organization. Third, at nearly $10 million, is American Solutions for Winning the Future, a truly non-partisan group (a rarity in Washington). Fourth, at $7.5 million, is yet another Democratic-affiliated organization, Fund For America. Fifth, at just under $7 million, is GOPAC. Sixth, at just over $6 million, is Emily’s List, a group supporting “pro-choice, Democratic women.” Seventh, at $4.7 million, is Alliance for New America, another Democratic-affiliated organization, followed by the College Republican National Committee at $4.1 million, Citizens United, another Republican-affiliated group, at just under $4 million, and the Gay & Lesbian Victory Fund, at $3.4 million.
Among the 10 highest-spending 527s this election cycle thus far, those affiliated with Democrats are outspending those affiliated with Republicans to the tune of around $48.5 million to $11 million.
So when Obama says “And we’ve already seen that he’s not going to stop the smears and attacks from his allies running so-called 527 groups,” and the New York Times says “Mr. McCain knows the power of these groups since they slimed him out of the 2000 Republican primaries. Now that he’s the presumptive nominee, however, he is inviting them into the fray on his behalf,” rest assured that the facts don’t match their rhetoric.
June 24th, 2008 at 4:39 pm
[...] [Technorati] Tag results for finance wrote an interesting post today onHere’s a quick excerpt Lately, we’ve been hearing a lot about so-called “527s,” political action organizations named for the tax code under which they fall. In opting out of public financing last week, Barack Obama said: “John McCain’s campaign and the Republican National Committee are fueled by contributions from Washington lobbyists and special interest PACs. And we’ve already seen that he’s not going to stop the smears and attacks from his allies running so-called 527 groups, who will spend millions and millions [...]