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Elections: The Myth of the Small Donor

Flickr photo courtesy of 401(K) 2012

“There is simply a better payoff by courting seven-figure donors,” said Matt Schlapp, a former White House political director for George W. Bush, in a Politico story Tuesday.

The story, “ Election 2012: The Myth of the Small Donor ,” details the meteoric rise of the mega-donor. Multimillion-dollar donations from people like Sheldon Adelson, Frank VanderSloot and the Koch brothers are “quickly diminishing one of the few avenues—outside of voting—for average folks to shape elections, help determine candidates’ viability and affect the course of the country.”

As this election quickly becomes the most expensive in history , the voice of regular voters is being drowned out by massive cash dumps from the 1% and corporations who funnel money through super PACs and 501(c)(4) “social welfare” groups that don’t have to report the source of their funds.

What are super PACs? What are 501(c)(4)s? And are they too complicated to understand, let alone fight against?

As we wrote Monday , we can win, once we understand what we’re up against.

The Supreme Court has, in a series of decisions, particularly in 2010’s infamous Citizens United v. Federal Election Commission (FEC), undermined past efforts to keep corporations and the rich from buying our democracy.   These decisions overturned laws that banned the use of corporate general treasury funds for independent expenditures and certain broadcast "electioneering communications," whether spent directly or indirectly through 501(c)(4) groups.

Much of the money being spent in the election is coming from super PACs. Super PACs are committees that can raise and spend unlimited sums for independent expenditures but may not donate directly to a candidate. Super PACs must disclose the source of their funds to the FEC.

501(c)(4) groups, named for the section of the Internal Revenue Code that creates them, are social welfare organizations that may not have political activities as their main purpose but may otherwise engage in limited political activities. These groups may accept unlimited amounts of money and need not disclose the source of those funds, which may explain why corporations are doing their political spending through these entities . There has been recent criticism about the use of 501(c)(4) groups to funnel secret money to super PACs  and the potential abuse of the form by some groups .

The Politico piece points out “[i]n an election purportedly being driven by the economic concerns of the middle class, the top 0.07 percent of donors are more valuable than the bottom 86 percent,” with Romney’s campaign and related super PACs receiving “only about 7 percent of their $362 million from donors who gave $200 or less” while 2.4 million Obama supporters have donated an average of $55 each. And remember—that ignores the 501(c)(4) groups, which are widely believed to be disproportionately funded by the megawealthy and corporations.

myvotemyright_180x200_medium

The concluding quote of the piece from 74-year-old retired teacher Larry Stevens sums up the situation pretty well:

It really just pisses me off that the Koch brothers and the super PACs and Karl Rove and Crossroads are trying to buy this election with massive amounts of money....We have to do what little we can to fight them back, and combined, collectively, maybe it will make a difference.

Despite the big money in this election, regular working people can make a difference—people power is the one thing that can beat money power. You can stand up to the money avalanche by volunteering with your local union, central labor council or Workers’ Voice for neighborhood canvasses, phone banks and other actions—and you can help make sure voting rights are protected for all by visiting the AFL-CIO's My Vote, My Right site here

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