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New York Times: When ‘Super PACs’ Become Lobbyists

Sunday, December 2nd, 2012

The “super PACs” and secret-money groups that polluted this year’s election with hundreds of millions of dollars’ worth of largely ineffective attack ads are not slinking away in shame. Many are regrouping and raising more money for a task that is no less pernicious: lobbying Congress and the White House on behalf of their special-interest donors, using the new, anything-goes rules of super PACs to make their advocacy more powerful.

New York Times

Americans for Prosperity, the so-called social welfare group founded with the support of David and Charles Koch, spent at least $36 million this cycle in a largely fruitless attempt to defeat Democrats and elect Republicans. Now it is joining with other conservative groups to lobby Congress not to raise taxes in the current negotiations over the “fiscal cliff.” The group is also demanding there be no reduction or delay in the budget sequester, the widely loathed measure that, in January, will begin cutting $1 trillion in spending over a decade.

It will be joined in that effort by the Club for Growth, which spent $19 million to elect Republicans; by Americans for Tax Reform, led by Grover Norquist, which spent almost $16 million; and by the American Crossroads groups, founded by Karl Rove, which spent $175 million. None of the candidates Crossroads supported won their races, but, nonetheless, the groups are planning a new lobbying and advertising effort on the fiscal cliff, as well as energy and health care issues, according to Roll Call, the Capitol Hill newspaper.

It’s bad enough that these groups and their wealthy donors, many of them secret, missed the message of the election, in which voters rejected their stridency and supported policies like higher taxes on the rich. But by combining lobbying with lavish campaign donations, they are enhancing the danger of the unlimited-spending era.

Super PACs can use the threat of raising unlimited money for the purpose of electing or defeating a candidate far more effectively than old-fashioned trade associations. Corporations, unions and other interests now have two ways to pressure public officials. They can unleash an expensive advertising and lobbying campaign on an issue like taxes or military spending, and then they can threaten to pummel lawmakers in primary or general election campaigns if they don’t get their way. Business leagues like the United States Chamber of Commerce have been doing this for years, but the ease of opening super PACs makes it possible for a much larger group of moneyed players, from conservative to liberal, to join the game.

That’s why the National Association of Realtors formed a super PAC to praise lawmakers for supporting tax deductions for second homes. The American Dental Association has one, as does Mayor Michael Bloomberg of New York (promoting centrism) and the Gay and Lesbian Victory Fund.

Many of the social welfare groups need to spend money on lobbying to show the Internal Revenue Service that their primary purpose isn’t electing candidates, though those goals are so intertwined that the I.R.S. still needs to force those groups to disclose their donors. Short of a constitutional amendment prohibiting unlimited spending, Congress can counter these combined political and lobbying assaults by passing the Empowering Citizens Act, which gives individuals a chance to be heard.

CNBC: Here’s How Much Candidates Spend to Get Your Vote

Thursday, October 25th, 2012

Barack Obama and Mitt Romney are spending a combined $26.86 every second this election cycle, as a binge of campaign spending deluges voters with rallies, banners, and of course, TV ads.

CNBC

The figure comes from a grand total of nearly $1.5 billion spent by both sides just through September. And that works out to about $70 million per month, and more than $2.3 million every day, according to data provided by the Federal Election Commission.

No wonder both candidates spend so much time in fundraisers.

From January 2011 through September, the Obama campaign burned through over $470 million, with the Democratic National Committee spending another $255 million.

And the top three Obama Super PACs dumped in another $53.7 million. All that totals more than $775 million dollars spent — before the crucial election month of October.

On the Romney side, the campaign had spent $298 million in that same time frame, which was joined by $249 million by the Republican National Committee and $156.5 million from the top three Romney Super Pacs. All told, that’s more than $700 million.

The Obama team held the lead by about $75 million as of September.

Historically, these are big, big numbers.

In 1980, Jimmy Carter and Ronald Reagan plus the DNC and RNC spent a combined $528 million in 2012-adjusted dollars. By 2000, that figure had jumped to $899 million in adjusted dollars.

That means the campaigns are spending a lot more per voter than they did years ago. Take a look at the math.

With more than $770 million in campaign and Super Pac spending for Obama this year, the forces supporting the president have spent about $5.33 per registered voter when you calculate using the total number or registered voters in the last campaign, which was just over 146.3 million.

Romney’s team, similarly, has spent about $4.81 per voter. Combined, that’s $10.14 per registered voter.

(Read More: Wall Street Gaming Romney Win: ‘Trillion at Stake’)

Compare that to how much it cost to reach registered voters in 1980: The $528 million spent by Reagan and Carter campaigns plus their parties reached fewer voters — 105 million registered voters. That made total spending over $5 per registered voter.

Election 2012

Your Money Your Vote - A CNBC Special Report

Twenty years later, George W. Bush and Al Gore and their party committees combined spent $899 million to reach that year’s nearly 130 million registered voters. That’s just under $7 per registered voter.

By our math, the cost to reach each voter in America has gone up consistently over the past three decades. There’s lesson in that for the campaigns and the fundraisers who push for ever more cash each year: that flood of money is causing political inflation. And that makes the constant reach for new fundraising records a self-fulfilling prophesy

ZeroHedge: Meet The Billionaires Behind The Best Presidents Money Can Buy

Sunday, October 21st, 2012

The last time we checked on the (funding) status of America’s real presidential race – the one where America’s uber-wealthy try to outspend each other in hopes of purchasing the best president money can buy – the totals were substantially lower. With November 6 rapidly approaching, however, the scramble to lock in those record political lobbying IRRs is in its final lap.

And thanks to the unlimited nature of PAC spending, look for the spending to really go into overdrive in the next 2 weeks as the spending frenzy on the world’s greatest tragicomedy hits previously unseen heights.

ZeroHedge

RESTORE OUR FUTURE

Total raised as of Sept. 30: $110.5 million – supports Republican presidential candidate Mitt Romney

  • Bob Perry – Houston builder who was a major donor to Swift Boat Veterans for Truth, a group that helped undermine 2004 Democratic presidential nominee John Kerry by attacking his Vietnam War record. Total donations: $10 million
  • Sheldon Adelson – billionaire Las Vegas casino magnate who built the Venetian hotel and casino. Donation: $5 million
  • Miriam Adelson – Sheldon’s wife. Donation: $5 million
  • Bill Koch – brother of conservative financiers David and Charles Koch. He runs Oxbow Carbon, a Florida-based firm that is also a donor and shares its address with another contributor, Huron Carbon. Total donations, including through firms: $4 million
  • Steven Lund – runs Nu Skin, a Utah skin care and cosmetics company whose former executives have been linked to two other firms that share an address in Provo, Utah, and donated to the Super PAC: F8 LLC and Eli Publishing. Lund’s wife Kalleen is also a donor. Total donations from the Lunds and firms: $3 million
  • Julian Robertson – hedge fund industry legend at Tiger Management. Total donations: $1.3 million
  • Crow Holdings – Dallas-based investment firm managing the wealth of the family of the late Dallas real estate mogul Trammell Crow, whose sons Harlan and Trammell S. Crow are also donors. Total Crow Holdings and Crow donations: $1.3 million
  • Harold Simmons – billionaire Dallas banker and CEO of Contran Corp who has contributed to PACs supporting Rick Perry and Newt Gingrich. Donations: $1.3 million
  • Frank VanderSloot – Idaho businessman who runs the nutritional and cosmetics company Melaleuca. The firm and its subsidiaries have also donated. Total donations: $1.1 million
  • The Villages of Lake Sumter – a community in Florida run by billionaire Gary Morse, who is also a donor alongside his wife Renee and their several children. Along with the Morse family, thirteen companies controlled wholly or partially by Morse that share an address in The Villages have also contributed. Total donations of all: $1.7 million.
  • Kenneth Griffin – Chicago-based hedge fund manager and CEO of Citadel LLC. Total donations: $1.1 million
  • Bob Parsons – billionaire founder of web hosting giant Go Daddy. Donation: $1 million
  • Jim Davis – chairman of New Balance Athletic Shoes Inc. Donations: $1 million
  • Stanley Herzog – CEO of Missouri-based Herzon Contracting Corp. Donation: $1 million
  • Bruce Kovner – billonaire hedge fund manager at Caxton Alternative Management. Donation: $1 million
  • Rocco Ortenzio – Pennsylvania healthcare executive and founder of Select Medical Corp. Total donations: $1 million
  • John Childs – founder of private equity firm J.W. Childs Associates LP in Florida. Donation: $1 million
  • Edward Conard – a New York investor and former executive at Bain Capital, a private equity firm co-founded by Romney. Donation: $1 million
  • John Kleinheinz – Texas hedge fund manager for Kleinheinz Capital Partners Inc. Donation: $1 million
  • J.W. Marriott Jr. – chairman and CEO of Marriott International, brother of Richard. Total donations: $1 million
  • Richard Marriott – chairman of Host Marriott International. Total donations: $1 million
  • Robert McNair – owner of the Houston Texans football team. Donation: $1 million.
  • Robert Mercer – New York hedge fund manager at Renaissance Technologies. Donation: $1 million
  • John Paulson – a prominent New York hedge fund manager at Paulson and Co. Donation: $1 million
  • Rooney Holdings Inc – private investment firm formed in 1980s to acquire the Manhattan Construction Co. and has since expanded into many areas. Total donations: $1 million
  • Paul Singer – hedge fund manager who helped fund efforts to legalize gay marriage in New York. Donation: $1 million
  • Paul and Sandra Edgerly – Paul Edgerly of Brookline, Massachusetts, is an executive at Bain. The Edgerlys each have given $500,000. Total donations: $1 million
  • Steven Webster – private equity executive at Avista Capital in Houston. Total donations: $1 million
  • Robert Brockman – executive at Reynolds and Reynolds, a Dayton, Ohio-based car dealership support company that shares a P.O. Box with CRC Information Systems Inc, Fairbanks Properties LLC and Waterbury Properties LLC, which split the donation three ways. Total donations: $1 million
  • Miguel Fernandez – chairman of MBF Healthcare Partners, a private equity firm. MBF Family Investments also donated to the Super PAC. Total donations: $1 million
  • Renco Group Inc. – owned by New York billionaire Ira Rennert, another frequent contributor to Republicans this year. Donation: $1 million
  • OdysseyRe Holdings Corp – reinsurance underwriting company in Stamford, Connecticut that is a U.S. subsidiary of Toronto-based Fairfax Financial. Donation: $1 million

 

PRIORITIES USA ACTION

Total raised as of Sept. 30: $50.1 million – supports Democratic President Barack Obama

  • James Simons – billionaire hedge fund manager, founder of Renaissance Technologies Corp. Donation: $3.5 million
  • Fred Eychaner – founder of Newsweb Corp. Donation: $3.5 million
  • Jeff Katzenberg – chief executive of DreamWorks Animation. Donation: $3 million
  • Steve Mostyn – Houston attorney. Donation: $2 million
  • Irwin Mark Jacobs – former CEO of Qualcomm Inc. Donation: $2 million
  • Jon Stryker – billionaire activist and heir to the medical supply company fortune of his grandfather. Donation: $2 million
  • Anne Cox Chambers – billionaire daughter of James M. Cox, founder of Cox Enterprises. Total donations: $1.5 million
  • National Air Traffic Controllers Association – union representing more than 16,000 workers. Donation: $1.3 million
  • S. Daniel Abraham – billionaire creator of Slim-Fast brand, chairman of S. Daniel Abraham Center for Middle East Peace. Donation: $1.2 million
  • Barbara Stiefel – retiree in Coral Gables, Florida. Donation: $1.1 million
  • United Auto Workers – Donations through various funds: $1.1 million
  • Kareem Ahmed – chief executive at Landmark Medical Management in California. Donation: $1 million
  • David Boies, Jr – New York lawyer. Donation: $1 million
  • Morgan Freeman – Hollywood actor. Donation: $1 million
  • Amy Goldman – writer and heiress to the New York real estate fortune of Sol Goldman. Donation: $1 million
  • Franklin Haney – owner and CEO of FLH Company, a Washington-based real estate company. Donation: $1 million
  • Bill Maher – stand-up comedian. Donation: $1 million
  • Mel Heifetz – real estate developer and gay activist. Donation: $1 million
  • Michael Snow – Minnesota lawyer. Donation: $1 million.
  • Steven Spielberg – film director. Donation: $1 million.
  • Ann Wyckoff – Seattle philanthropist. $1 million.
  • Service Employees International Union Committee on Political Education – union representing more than 2 million workers. Donation: $1 million.
  • United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry – union representing some 340,000 workers. Total donations: $1 million

AMERICAN CROSSROADS

Total raised as of Sept. 30: $68 million – supports Republican candidates for federal offices

  • Harold Simmons – Total donations together with Contran Corp: $15.5 million
  • Bob Perry – Total donations: $6.5 million
  • Robert Rowling – an Irving, Texas, businessman and a conservative and active Republican donor. His company, TRT Holdings Inc, which runs Omni Hotel and Gold’s Gym chains, is also a donor. Total donations: $4 million
  • Joe Craft – billionaire coal executive from Tulsa, Oklahoma, and CEO of Alliance Holdings, which is also a donor. Total donations: $2.1 million
  • Jerry Perenchio Living Trust – a trust of billionaire television tycoon A. Jerrold Perenchio, who is a former chairman of Spanish-language broadcaster Univision. Donation: $2 million
  • Crow Holdings – Dallas-based real estate investment firm. Total donations: $1.5 million
  • Weaver Holdings and Weaver Popcorn – Indiana-based company specializing in popcorn. Total contributions: $1.9 million
  • Stephens Inc – a Little Rock, Arkansas, broker dealer. Total donations: $1.3 million
  • Armstrong Group – telecommunications conglomerate in Pennsylvania. Donation: $1.3 million
  • JWC III Revocable Trust – Donatoin: $1.3 million
  • Robert Brockman – executive at Ohio-based Reynolds and Reynolds. Similarly to Restore Our Future, three firms sharing a P.O. Box – CRC Information Systems Inc, Fairbanks Properties LLC and Waterbury Properties LLC – split the donation three ways. Total donations: $1 million
  • Whiteco Industries – Indiana-based company involved in advertising, construction, entertainment and hotels. Donation: $1 million
  • The Mercury Trust – entity linked to California private equity firm of Saul Fox. Donation: $1 million
  • Clayton Williams Energy Inc – Midland, Texas-based drilling company. Donation: $1 million
  • Jay Bergman – of PETCO Petroleum Corporation. Donation: $1 million
  • Kenneth Griffin – Citadel Investment Group chief executive. Total donations: $1 million
  • Wayne Hughes – Founder of Public Storage. Total donations: $1 million
  • John Childs – Chairman and CEO of Boston-based JW Childs Associates. Total donations: $1 million
  • Philip Geier – New York executive. Total donations: $1 million
  • Irving Moskowitz – a Florida bingo magnate who runs a charity in California and is known for his support of Jewish settlers in East Jerusalem. Donation: $1 million
  • Robert Mercer – co-CEO of hedge fund Renaissance Technologies. Donation: $1 million

 

BARACK OBAMA (Democrat)

  • Total raised, including transfers: $609.4 million
  • Raised in September, including transfers: $136.2 million
  • Total transferred from the funds jointly used by the campaign and the Democratic Party: $176.6 million
  • Transferred in September: $39.8 million
  • Total spent: $469.9 million
  • Spent in September: $111.4 million
  • Cash on hand: $99.3 million
  • Debt: $2.6 million

DEMOCRATIC NATIONAL COMMITTEE

  • Total raised: $253.6 million
  • Raised in September: $20.3 million
  • Total transferred in: $108.4 million
  • Transferred in September: $4.0 million
  • Total spent: $261.6 million
  • Spent in September: $22.8 million
  • Cash on hand: $4.6 million
  • Debt: $20.5 million

OBAMA VICTORY FUND 2012 (The main joint Obama/DNC fund)

  • Total raised: $371.1 million
  • Raised in September: $80.0 million
  • Cash on hand: $45.2 million

 

MITT ROMNEY (Republican)

  • Total raised, including transfers: $337.2 million
  • Raised in September, including transfers: $76.2 million
  • Total transferred from the funds jointly used by the party and the Romney campaign: $236.4 million
  • Transferred in September: $34.2 million
  • Total spent: $298.2 million
  • Spent in September: $54.7 million
  • Cash on hand: $63.1 million
  • Debt: $5.0 million

REPUBLICAN NATIONAL COMMITTEE

  • Total raised: $331.2 million
  • Raised in September: $48.4 million
  • Total transferred in: $127.5 million
  • Transferred in September: $28.6 million
  • Total spent: $249.4 million
  • Spent in September: $42.4 million
  • Cash on hand: $82.6 million
  • Debt: $9.9 million

ROMNEY VICTORY INC (Joint Romney/RNC fund – third quarter, July through Sept.)

  • Total raised: $375.6 million
  • Raised in third quarter: $235.2 million
  • Cash on hand: $37.4 million

Appendix: SUPER PACS:

RESTORE OUR FUTURE, a Super PAC supporting Romney

  • Total raised: $110.5 million
  • Raised in September: $14.8 million
  • Total spent: $94.9 million
  • Spent in September: $4.6 million
  • Cash on hand: $16.6 million

PRIORITIES USA, a Super PAC supporting Obama

  • Total raised: $50.1 million
  • Raised in September: $15.3 million
  • Total spent: $43.6 million
  • Spent in September: $12.8 million
  • Cash on hand: $7.3 million

AMERICAN CROSSROADS, a Super PAC supporting Republicans

  • Total raised: $68.0 million
  • Raised in September: $11.4 million
  • Total spent: $53.4 million
  • Spent in September: $27.9 million
  • Cash on hand: $15.8 million

Source: Reuters

Los Angeles Times: Poll: Americans largely in favor of campaign spending limitations

Monday, September 17th, 2012

Amid the flurry of cash directed at the presidential campaigns as well as congressional races, a new poll reveals that the American people aren’t pleased with the vast amount of fundraising now involved in elections.

Los Angeles Times

An Associated Press-National Constitution Center poll found that 83% believe there should be at least some limits on the amount of money corporations, unions and other organizations are permitted to contribute to groups seeking to influence the outcome of presidential and congressional races. And 67% think that limits should also be placed on individual contributions to campaigns. That matches up with just 13% who don’t want limits on external contributions, and 28% who repudiate limits on individuals.

The poll comes during the first post-Citizens United presidential election, stemming from the 2010 Supreme Court decision which ceased limitations on campaign expenditures aimed toward independent organizations made by corporations, ruling them to be free speech protected under the Constitution.

INTERACTIVE: Spending during the 2012 election

The Los Angeles Times has detailed much of the money spent by third-party groups on either side of the presidential race, which as of Sunday has topped $152 million since April. That spending is dominated by spending against President Obama, ($88.9 million), compared with the relatively small amount spent so far against Mitt Romney ($34.9 million).

Americans for Prosperity, a conservative nonprofit advocacy group heavily backed by the well-known Koch brothers, top the list of groups working against Obama, spending $30.8 million on “issue ads.” Restore Our Future, a group formed by former aides of Romney’s campaign, narrowly trails AFP with $28.4 million.

Spending against Romney, on the other hand, is singularly dominated by Priorities USA Action’s $26.4 million, which accounts for over 75% of the total spending against the Republican candidate. Priorities USA Action, like Restore Our Future, was started by former White House aides.

Tellingly, opposition spending dwarfs spending made in favor of either candidate, with just $4.8 million spent in support of Obama, and $13 million spent in favor of Romney.

INTERACTIVE: Battleground states map

As for the presidential rivals themselves, Obama and the Democratic Party, for the first time since April, recently out-raised Romney and the Republican National Committee during August, $114 million to $111.6 million. Through August, Obama and the DNC lead Romney and the RNC in fundraising $747.4 million to $645.9 million.

Romney has repeatedly defended the ruling in Citizens United, while Obama has called for it to be overturned.

The AP-National Constitution Center Poll was conducted between Aug. 16-20 with landline and cellphone interviews among 1,006 individuals with a margin of error of +/- 3.9 points.

Washington Post: Post-Watergate campaign finance limits undercut by changes

Sunday, June 17th, 2012

In 1984, President Ronald Reagan ran for reelection without holding a single campaign fundraiser because he and Democratic challenger Walter Mondale each accepted $40 million in public funds.

President Obama and Republican challenger Mitt Romney spend much of their time crisscrossing the country to collect as much cash as possible, while political groups run by their former aides solicit donations of seven — and eight — figures from sympathetic billionaires.

Washington Post

The money poured into Richard M. Nixon’s reelection campaign from all corners: Six-figure checks flown by corporate jet from Texas; bundles of payments handed over at an Illinois game preserve; a battered brown attaché case stuffed with $200,000 in cash from a New Jersey investor hoping to fend off a fraud investigation.

During four pivotal weeks in spring 1972, the president brought in as much as $20 million — about $110 million in today’s dollars — much of it in the form of illegal corporate donations and all of it raised to avoid disclosure rules that went into effect that April.

“The decision was made that it was time to put the hay in,” John Dean, Nixon’s counsel at the time, recalled in an interview last week. “A lot of us believe Watergate might never have happened without all that money sloshing around.”

Four decades later, there’s little need for furtive fundraising or secret handoffs of cash. Many of the corporate executives convicted of campaign-finance crimes during Watergate could now simply write a check to their favorite super PAC or, if they want to keep it secret, to a compliant nonprofit group. Corporations can spend as much as they want to help their favored candidates, no longer prohibited by law from spending company cash on elections.

The political world has, in many respects, come full circle since a botched burglary funded by illicit campaign cash brought down an administration. The excesses of the Nixon era ushered in a series of wide-ranging restrictions on the use of money in campaigns, including limits on individual campaign contributions that remain in force today.

But the intervening decades have also brought changes that have undercut many of the political financing rules put in place in response to the Watergate scandal, including a Supreme Court case that freed corporations and unions to spend unlimited money on elections and a public-financing regime that has collapsed into irrelevance.

‘Money corrupts’

The result is a frenzied rush to raise money, with echoes of that spring 40 years ago: President Obama and Republican challenger Mitt Romney spend much of their time crisscrossing the country to collect as much cash as possible, while political groups run by their former aides solicit donations of seven — and eight — figures from sympathetic billionaires.

Last week, Las Vegas casino magnate Sheldon Adelson contributed $10 million to Restore Our Future, a super PAC dedicated to helping Romney win in November. Adelson, one of the richest men in the world, and his relatives have spent more than $35 million to help Republicans in the 2012 elections.

“I think we’re in the middle of a scandal that hasn’t quite gelled yet,” said Roger M. Witten, who worked in the Watergate special prosecutor’s office and now handles campaign-finance cases at WilmerHale in New York. “A tremendous amount of ground has been lost. We’ll have to relearn the lessons of Watergate — that money corrupts the system.”

Many conservatives and civil-liberties advocates take a different lesson, however, saying stricter rules would have done little to stop Nixon political operatives intent on breaking the law. Bradley J. Smith, a former Federal Election Commission chairman who is one of the leading voices for deregulating the campaign finance system, said many of the limits enacted after Watergate were ineffective and intruded on First Amendment rights.

“It’s not bad or good in and of itself to spend more money in politics,” Smith said. “We’ve got to shake off the bugaboo, the ghost of Watergate, that somehow justifies never-ending regulation of people’s free-speech rights.”

At the dawn of 1972, Nixon campaign aides, fueled by their boss’s legendary paranoia and scheming, set out to ensure his reelection by taking advantage of a window of opportunity — a loophole that let them raise unlimited, secret funds for about a month between the expiration of one election law and the enactment of a new one. The frenzy began March 10 and lasted until April 7, when legislation went into effect requiring disclosure of political donors.

In the months and years that followed, prosecutors and journalists unraveled a mind-boggling array of bank accounts and revolving political committees used to launder the money. Overseen by Nixon’s finance director, Maurice Stans, the effort featured a half-dozen “pickup men” roaming the country gathering checks and cash.

The volume was so great that some donations that had been offered went uncollected, while others came in late. One New Jersey lawmaker showed up in Washington on April 10 with a briefcase filled with $200,000 in $100 bills, money eventually traced to indicted financier Robert L. Vesco; the contributions were treated as if they had been received prior to the deadline.

Overall, Nixon’s 1972 reelection effort raised an estimated $60 million — “the largest amount of money ever spent in a political campaign,” as Stans later bragged.

By 1975, prosecutors reported that 32 individuals and 19 corporations were convicted or had pleaded guilty to violations of campaign-contribution laws, including household names such as Goodyear, Minnesota Mining and Manufacturing, Northrop, American Airlines, Gulf Oil and Phillips Petroleum, records show.

Former Watergate prosecutor Frank Tuerkheimer, who now teaches law at the University of Wisconsin, said he and his colleagues viewed the cases as the beginning of a crackdown on campaign-finance violations.

‘We were wrong’

“Unfortunately, that didn’t happen,” Tuerkheimer said. “We thought it would result in serious enforcement. We were wrong.”

Congress responded to Watergate by amending the Federal Election Campaign Act in 1974, which implemented contribution and spending limits, created the FEC and provided a system of public financing for presidential contests. The Supreme Court soon struck down the spending limits and other restrictions on free-speech grounds in Buckley v. Valeo.

But donation limits and public financing remained, and, for a time, money seemed to play a smaller role in national politics. In 1984, President Ronald Reagan ran for reelection without holding a single campaign fundraiser because he and Democratic challenger Walter Mondale each accepted $40 million in public funds.

The next crack in the wall constructed by reformers came in the 1990s, after a series of FEC rulings led to the rise of unlimited “soft money” donations to parties, an atmosphere that spurred several major financing scandals during Bill Clinton’s presidency. Reformers pushed back again in 2002 with a major campaign finance law sponsored by Sens. John McCain (R-Ariz.) and Russell Feingold (D-Wis.), which banned unlimited donations to parties, imposed new restrictions on ads and attempted to limit the impact of self-funding millionaire candidates.

Many of the McCain-Feingold provisions, however, were struck down in a series of decisions culminating in the Supreme Court’s 2010 ruling in Citizens United v. Federal Election Commission , which jettisoned a long-standing ban on corporate and union spending on elections. The court ruled 5 to 4 that corporations had the same rights as people when it comes to political speech, upending restrictions on election spending by businesses that stretched back a century.

‘Brought back to life’

The rulings have led to a proliferation of super PACs and other groups and have made it easier for wealthy individuals to spend unlimited money on politics.

“The pieces that created the Watergate scandal — secret money, unlimited donations — have been brought back to life by the Citizens United decision,” argues longtime activist Fred Wertheimer, who helped draft many of the reforms put in place in the 1970s. “The Supreme Court’s idea that you can let all this money into the system without leading to corruption is absurd.”

The long-running debate has been complicated by shifting politics and allegiances. Those in favor of more restrictions on campaign spending now tend to be Democrats, who have been pushing unsuccessfully to enact new disclosure laws for secretive nonprofits and other reforms. Leading Republicans, meanwhile, have adopted a no-regulation posture: Senate Minority Leader Mitch McConnell (Ky.) said last week that Obama’s push for broader disclosures amounted to a “Nixonian” attempt to intimidate conservatives.

But 40 years ago, the lines were scrambled, and many proponents of fewer restrictions came from the left. Joel M. Gora, now a professor at Brooklyn Law School, worked with the American Civil Liberties Union to help advocacy groups resist donor disclosure requirements and was on the legal team that rolled back many restrictions in Buckley.

Gora views Citizens United and other anti-regulation decisions as victories for free speech and says that many regulations are part of an “incumbent protection racket” aimed at quashing dissent. One of the plaintiffs in Buckley was Eugene McCarthy, whose insurgent Democratic presidential bid in 1968 was heavily funded by six-figure donations from antiwar donors.

“These laws are restricting outsiders, whether liberal or left-wing outsiders or conservative and right-wing outsiders,” Gora said. “The difference between the Adelsons of today and the people who wanted to support Gene McCarthy is really just a matter of the amount.”

 

Research editor Alice Crites contributed to this report.

© The Washington Post Company