Over at Vox, Ezra Klein suggests that journalists digging into the Clinton Foundation may have their priorities out of order. While acknowledging that “these investigations are worthy,” he claims “the daily corruption that powers modern presidential campaigns is much, much worse” than any potential conflicts of interest arising from the Clinton Foundation.
There is much to take issue with, but I’ll restrict myself to these three thoughts:
Do Super PACs allow “corporations and even foreign governments a way to donate huge amounts of money to the Clintons without seeming like they were donating huge amounts of money to the Clintons”?
Klein begins his piece by describing the allegations against the Clinton Foundation and contrasting them with normal Super PAC activity. He writes:
“[T]he basic concern is that the Clinton Foundation gave corporations and even foreign governments a way to donate huge amounts of money to the Clintons without seeming like they were donating huge amounts of money to the Clintons – and those donations could have given them unusual access or influence in Hillary Clinton’s State Department, or to her hypothetical future White House.
When you look at it that way, what becomes clear is that whatever the conflicts in the Clinton Foundation’s finances, the daily corruption that powers modern presidential campaigns is much, much worse.”
Klein identifies Super PACs as the culprit, saying, “the dynamics behind Clinton’s Super PAC are the precise dynamics that people fear existed in the Clintons’ foundation.”
Actually, the dynamics are quite different. For one, by law, Super PACs report the identities of all of their significant donors, the size of their contributions, and how the organization spends its money. They cannot be used to shield or hide anything. Furthermore, the Supreme Court has made clear that permitting corporations and unions to support or oppose candidates did not invalidate the existing ban on foreign corporations from doing the same. And while domestic for-profit corporations can contribute to Super PACs, most choose not to. It turns out that upsetting a large percentage of your customers is a poor business practice, and taking sides in an election is a surefire way to upset people. Companies likely feel more comfortable contributing to organizations that are not explicitly political, such as the Clinton Foundation.
Is “dark money” significant?
Klein claims that “dark money” has become a “powerful” feature of modern campaigns, but in reality these types of groups remain bit players. Klein notes that $310 million was spent in the 2012 election cycle by groups who do not disclose their donors, but conveniently does not mention that this pales in comparison to the $7.3 billion spent in total in the 2012 cycle. In other words, so-called “dark money” accounted for just 4.3 percent of total election spending in 2012. In 2014, it was just 3.7 percent of total spending. Even when it concentrates in certain races, it does so almost exclusively in competitive, high-profile races with lots of media coverage and spending on both sides. To call it a “powerful” force in elections is inaccurate, and as we’ve explained before, for a variety of reasons, it is unlikely to ever become one:
“Because 501(c) organizations may not have political activity as their primary purpose, they must conduct their activities to stay within the IRS guidelines to maintain their exempt status. In effect, then, a donor whose main objective is political activity faces the effective equivalent of an over 50 percent tax on his or her political donations by giving to a 501(c) organization rather than to a “Super PAC,” which fully discloses its donors. This is because the group must primarily spend its funds on programs other than political activity, as defined in Section 527 of the tax code. As a result of this inefficiency, it is doubtful that spending by 501(c) organizations will increase substantially as a percentage of independent or total spending.”
Are political donors engaging in corruption?
Klein suggests that donors to the Clinton Foundation pose a lesser threat of corruption than donors to a Super PAC, because donors to the Foundation might be motivated by a benevolent desire to improve the world, whereas donors to a Super PAC are acting politically. He writes, “and there will be no chance that these [Super PAC] donors simply wanted to help Bill Clinton distribute HIV/AIDS drugs in the world’s poorest countries.” This is a bleak and inaccurate view of politics. Leaving aside the many more effective charities for HIV drug distribution, there is no bright line between the motives of donors to nonprofit foundations and donors to political organizations. Politically active people are often driven by a belief that they can improve the world through better policies. Indeed there is strong evidence that campaign contributions are a form of consumption and participation rather than an attempt to “buy” policy outcomes. Some Super PAC donors no doubt seek influence, but there is no reason to believe that the number is higher for donors giving to Super PACs versus those giving to a politically connected nonprofit.
Klein attempts to portray Super PACs as primarily avenues for corruption. That simply isn’t the case. Super PACs exist to ensure that when individuals join together their First Amendment rights are not diminished. The major impact of Super PACs on politics has not been to stoke the “bipartisan corruption” Klein fears, but to strengthen democracy by allowing more candidates to run competitive campaigns.