Consider the Source

Sen. John McCain, R-Ariz. is pursued by reporters on Capitol Hill in Washington. Manuel Balce Ceneta/AP

John McCain predicts 'huge scandals' in super PAC-tainted election

By Michael Beckel

Sen. John McCain slammed the Supreme Court’s 2010 Citizens United decision as “incredibly naïve” on Tuesday, and predicted there would be “huge scandals” in its wake.

The Arizona Republican was co-author with then-colleague Sen. Russ Feingold, D-Wis., of the last major attempt by government to reform campaign finance laws in 2002. He was participating in a panel discussion on the decision at the Newseum in Washington, D.C.

The law prohibited corporations and unions from bankrolling issue ads that mention a candidate within the final weeks before an election.

But under the contentious Citizens United ruling, corporations and unions were freed not only to fund issue ads that mention a candidate but to also make so-called “independent expenditures” that urge people to vote for or vote against candidates.

Many worry this change will increase the potential for corruption and unseemly alliances between lawmakers and special interests.

The ruling has given rise to independent expenditure groups called "super PACs," which can accept unlimited contributions from individuals, corporations, unions and trade groups. They may not donate money to candidates’ campaigns nor coordinate with candidates about their expenditures.

Super PACs have collectively raised more than $230 million since their creation in 2010, according to the nonpartisan Center for Responsive Politics.

In the 2012 GOP presidential race, each candidate has benefited from super PACs — particularly former Massachusetts Gov. Mitt Romney — which have frequently been run by their former top aides and funded by an elite network of donors.

At the Thomson Reuters-sponsored event, McCain called this overlap between campaigns and super PACs “outrageous” and said the independence of super PACs is “the worst joke in Washington.”

Consider the Source

The super PAC cavalry

By Michael Beckel

Where would candidates be in the presidential race without their super PAC allies? The nascent groups, created in the wake of the Supreme Court’s 2010 Citizens United ruling,  have been a dominant force in the GOP primary, and they have helped extend a nomination contest that many expected to be wrapped up long ago.

All candidates have benefited from super PACs, but no group has collected more money than the pro-Mitt Romney “Restore Our Future” super PAC, which raised more than $43 million through February. That’s nearly 60 percent of the sum that the Romney campaign itself has raised.

The money in both accounts — the super PAC and the campaign — has allowed Romney’s messages to dominate the GOP race, even if his campaign is legally prohibited from coordinating on expenditures with Restore Our Future.

Newt Gingrich, meanwhile, has been aided by a super PAC called “Winning Our Future,” which has raised nearly $19 million. And the “Red, White & Blue Fund,” which supports Rick Santorum, has raised nearly $5.8 million. In fact, Winning Our Future has nearly matched the Gingrich campaign dollar for dollar: For every $1 the Gingrich campaign raised through February, the super PAC raised 91 cents.

Looming large on the horizon, however, is President Barack Obama, who has amassed more than $158 million for his re-election campaign, and, thanks to no serious primary opposition, still counts nearly $85 million in the bank. Furthermore, last month, Obama gave his blessing to a super PAC called "Priorities USA Action," which has already aired ads attacking Romney.

Consider the Source

From left: Mitt Romney at a victory rally in Schaumburg, Ill., Bob Perry of Perry Homes. Steven Senne/AP, Bob Perry website

Pro-Romney super PAC reports more cash on hand than Romney campaign

By John Dunbar

A February increase in financial support for underdog Rick Santorum was too little and too late to slow the far-better financed Mitt Romney, who coasted to an easy victory in the Illinois Republican presidential primary Tuesday.

Santorum’s campaign raised $9 million in February compared with $4.5 million in January. The “Red, White and Blue Fund,” a super PAC supporting former Pennsylvania Sen. Santorum, raised $3 million, 41 percent more than what it raised in January.

Romney’s campaign, meanwhile, raised $12 million in February, nearly doubling its January total, while the super PAC supporting the ex-Massachusetts Gov., “Restore Our Future,” brought in $6.4 million, $3 million of which came from Texas homebuilder and Republican super donor Bob Perry of Texas.

Romney drew 47 percent of the vote in Illinois, former Pennsylvania senator Santorum garnered 35 percent, and Texas congressman Ron Paul of Texas drew 9.3 percent while Gingrich lagged in fourth at 8 percent.

Santorum’s recent financial surge has been aided by Wyoming businessman Foster Friess, who donated $600,000 to the pro-Santorum Red, White and Blue Fund in February, and retired Louisiana energy executive William Dore, who gave the group $500,000 last month.

The pro-Santorum PAC also received a $1 million contribution last month from Annette Simmons, wife of GOP mega-donor Harold Simmons, a billionaire investor who hails from Texas.

All told, the Simmons family donated to each of the top three GOP presidential candidates’ super PACs in February, with Harold giving $100,000 to Restore Our Future and another $100,000 to “Winning Our Future,” a super PAC supportive of Gingrich.

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Sen. Jim DeMint (R-S.C.) J. Scott Applewhite/AP file

Tea Party-aligned Sen. Jim DeMint donates $500,000 to Club for Growth super PAC

By Michael Beckel

In his quest to remake the Senate Republican caucus in his own image, Tea Party kingmaker Sen. Jim DeMint (R-S.C.) has thrown some serious cash at a conservative super PAC that has attacked a Republican House member and other GOP candidates for office.

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Susan Walsh/AP

Pro-Romney super PAC returns donation from charity

By Rachael Marcus

The Citizens United case opened up a whole new way of giving for nonprofit corporations, but there are still some lines that can’t be crossed.

Last July, the pro-Mitt Romney super PAC “Restore Our Future” accepted a check for $100,000 from the Rod and Leslie Aycox Foundation, a nonprofit with the same tax status as a charity or hospital. That’s a no-no according to the Internal Revenue Service.

The 501(c)(3) corporation was clearly in violation of tax law, according to the IRS, which states these organizations are “absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign.”

So the foundation faced the wrath of the IRS, but the super PAC?

“The liability is all on the donor side … but there is no legal exposure for the recipient,” said campaign lawyer Kenneth Gross.

In February, the foundation, based in Alpharetta, Ga., remedied the situation.

In the newest filing to the Federal Election Commission, Restore Our Future refunded the full $100,000 to the foundation.

“The foundation requested a contribution refund, and when they did so, we promptly complied with their request,” said Charlie Spies, the treasurer of Restore Our Future.

The $100,000 contribution was returned to the foundation in February. That same month, Rod Aycox personally made a contribution to the pro-Romney super PAC of $100,000.

While the Aycox Foundation was liable for the contribution, Restore Our Future was never at risk, said Paul Ryan at the Campaign Legal Center.

Consider the Source

Screen shot of Raja Krishnamoorthi's campaign video, "Renewing Prosperity" YouTube

Illinois Democrat gets eleventh hour boost from family-funded super PAC

By Michael Beckel

Democratic U.S. House candidate Raja Krishnamoorthi of Illinois has said he “detest[s]” super PACs, but his friends and family don’t appear to share that opinion. They have provided all of the money to a super PAC called “Suburban Voters for Choice,” which has spent $17,600 on a TV ad trying to give his campaign a last-minute boost.

Kalikathan Krishnamoorthi, the candidate’s father, a professor at Bradley University, donated $9,000 to Suburban Voters for Choice earlier this month, according to an iWatch News review of paperwork filed voluntarily by the group to the Federal Election Commission this week.

The candidate’s brother, Venkatesan “Ram” Krishnamoorthi, a doctor, donated an additional $2,400, and Glen Tullman, who is identified as both a “friend of Raja” and the president of healthcare information technology Allscripts, donated $10,000.

The three men are the only donors to the nascent super PAC, which was formed just three weeks ago by Michael Vainisi, who served as the finance director of Krishnamoorthi’s 2010 campaign for state comptroller. The group’s assistant treasurer, J.B. Mantz, also previously served as a senior advisor to Krishnamoorthi during that unsuccessful race.

The group expressed a desire to disclose the names of its donors before Tuesday’s primary election in the spirit of “transparency,” according to its filing with the FEC. Because of the group’s late formation, it was not legally required to disclose any of its donors prior to the election.

“We are going beyond what election law requires to disclose our donors now ahead of time, instead of waiting until after the election,” Mantz told iWatch News. “We think that that’s the more honest and ethical approach.”

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Screen shot from Conservative Action Fund ad, "Surfing Rabbi says" YouTube

GOP super PAC men seek to overturn donation limits

By Michael Beckel

As unlimited contributions flow into super PACs this year, one man is at the center of a new effort to allow people to donate more money, to more candidates, at the national stage.

“I don’t believe government is there to limit us,” Shaun McCutcheon told iWatch News.

McCutcheon is a 44-year-old general contractor in Alabama. He’s the owner, founder and president of Coalmont Electrical Development. He’s a member of the Republican Party who admits he may have a bit of a libertarian streak. And he’s also the treasurer of a super PAC called the “Conservative Action Fund.”

That's a group that spent more than $43,000 opposing House Financial Services Committee Chairman Spencer Bachus (R-Ala.) in Tuesday’s GOP primary in Alabama, although it has mostly targeted Democrats with its attacks.

In one advertisement it produced last fall, the super PAC accused President Barack Obama of implementing "draconian laws and regulations." And it aired another ad that featured a "surfing rabbi" and computer-animated versions of Obama, along with New York Democrats Anthony Weiner and David Weprin, dancing in hot dog costumes — all while encouraging voters to support Republican Bob Turner in the special election to replace Weiner after his sexting scandal.

Now McCutcheon is requesting that the FEC repeal the existing biennial limit on how much money individuals can donate to federal candidates.

McCutcheon wants to donate at least $51,900 to multiple federal candidates ahead of the elections this November, spread across more than two dozen conservative politicians, according to documents released by the FEC on Wednesday.

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Writers and editors

John Dunbar

Managing Editor, Politics The Center for Public Integrity

John is director of Consider the Source, the Center's ongoing investigation of the impact of money on state and federal politic... More about John Dunbar

Paul Abowd

Reporter The Center for Public Integrity

Paul is money and politics reporter for the Center's Consider the Source project. He comes to D.C.... More about Paul Abowd

Michael Beckel

Reporter The Center for Public Integrity

Michael Beckel joined the Center for Public Integrity as a politics reporter in February 2012, where his focus is super PACs and the infl... More about Michael Beckel

Reity O'Brien

James R. Soles Fellow The Center for Public Integrity

Reity O’Brien is the Center’s 16th James R. Soles Fellow.... More about Reity O'Brien

Chris Young

American University Fellow The Center for Public Integrity

Chris Young is an American University Fellow currently working as a member of the Center’s Consider the Source team.... More about Chris Young

Dave Levinthal

Senior reporter The Center for Public Integrity

Dave Levinthal joined the Center for Public Integrity in 2013 to help lead its Consider the Source project investigating the influence of... More about Dave Levinthal

Ben Wieder

CAR Reporter The Center for Public Integrity

Ben Wieder is the Computer Assisted Reporter for the Consider the Sourc... More about Ben Wieder