EP. 4 — THE SUPER PAC SURPRISE

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Weston Wamp:  I'm Weston Wamp and this is Swamp Stories brought to you by Issue One.

Mike Huckabee: The problem is we have a wall street to Washington access of power that is control the political climate, and the result is federal government keeps getting bigger.

Weston Wamp:  That was former Arkansas governor, Mike Huckabee. He always had a knack for describing the swamp in a folksy, effective sort of way.

Mike Huckabee:  The donor class feeds the political class, who does the dance that the donor class wants.

Weston Wamp:  A lot of the problems we face point straight back to the 2010, now infamous, Citizens United decision from the Supreme Court. In fact, here's what liberal commentator Keith Olbermann had to say on the evening of that decision quote, "In short, there are now no checks on the ability of corporations or unions or other giant aggregations of power to decide our elections.

None. But guess what?" There really aren't corporate sponsored candidates in quite the way that some of us feared, at least not yet. The bottom line is a lot of what we've been told is wrong. In fact, Citizens United wasn't technically the Supreme Court decision that created what we know as super PACs, but those who knew that Citizens United spelled trouble were right.

It's damaged our elections profoundly, just in a different way than we expected. A lot of people like me assume corporations would dump money into elections and buy candidates. The truth is, that's rarely happened. In 2018, well over $1 billion flowed from super PACs, but none of the top 20 organizations that gave to super super PACs were actually corporations. Now, some of those groups might have taken corporate donations. But this is not what you expected.

So while you're dizzy, I'll go further. 70% of the 20 largest organizational donors to super PACs were supporting Democratic aligned super PACs. And remember, Democrats took back the house overwhelmingly in 2018 this big money approach is working, but what's really happening here? Here's the skinny: One super PACs are bad, disastrous. Some people would say too many of our assumptions about them were off. Three, we've got to educate ourselves on exactly what's happening if we're ever going to fix it.

This is episode four, the Super PAC Surprise.

To get started, let's do a quick recap of what happened in 2010 that changed everything we know about money in elections. First, Citizens United. The takeaway of that Supreme Court decision was that corporations can spend as much as they want in elections as long as the money doesn't go directly to candidates. The ruling was this: corporations are people. So in the same way that the first amendment protects people's rights to spend as much money as they want, expressing their opinion, corporations could now do the same, but truthfully, not a lot of corporations exercise their rights to spend freely in campaigns.

It's been billionaires, trade associations, and unions that have proven to be the big spenders of the super PAC era. Corporations, especially publicly traded ones, have tended to shy away from big giving to super PACs, possibly afraid of the public backlash that would follow since super PAC donors are disclosed. Now back to 2010.

The Citizens United ruling opened the door to a second ruling: Speech Now V. FEC. Based on Citizens United, unlimited amounts of money could be given to political action committees so long as the political action committees remained independent of campaigns. Unlimited money into a PAC equals a super PAC. Let's pause because I know this is complicated.We're talking about multiple decisions that sound about exactly the same, but it's important to tell the difference if we're ever going to get to the bottom of this. I feel like I need an Advil. But let's just keep going.

It turns out that Speech Now v. FEC created a gold rush of political entrepreneurs realizing that instead of raising $5,000 at a time into traditional PACs, a super PAC could raise as much money as you could convince a billionaire to give. And the more money in the PAC, the more power the political operative running it has and the higher salary they can pay themselves to manage it.

I got ahold of Mark McKinnon, the host of "The Circus" on Showtime, and the former Chief Media Advisor to both President George W. Bush and Senator John McCain during their presidential runs to talk about this exact problem.

Mark McKinnon:  So you have these entities, which are often really just money making machines for a few people. And that's often usual just a few people involved, some, you know, bullshit governance structured bylaw that includes people who are gaining from it.

Weston Wamp:  It didn't take long before billionaires were starting their own super PACs to play in elections. A cottage industry developed among Republicans and Democrats to help incorporate and manage super PACs. It's taken years to get a true grasp on the chaos that has unfolded. Millions of people have now organized under the mantra "In Citizens United". And while debates will rage over who can give how much and whether corporations are people, super PACS are screwing up our elections today because the big political players are skirting the rules.

Here's what's going on: the entire basis of the Supreme Court's decision to allow corporations to spend unlimited money in elections was that their money would be independent of candidates and their campaigns. Since the money wasn't going directly to the candidates, the money wouldn't be quote "corrupting", nor would it have the appearance of corruption, but that's just not the case.

Honestly, the naïveté of the Supreme Court that the spending would remain independent is embarrassing and their failure to see that there was no reliable enforcement mechanism has opened the door to a gross manipulation of the Supreme Court's intent by both political parties. For the sake of understanding super PACs, the opposite of being independent is coordination.

Trevor Potter:  Coordination is when two people get together and plan spending or one person asks the other to spend money or one says, "I'm going to spend it. This is the way I'm thinking of, would it be helpful to you?" That's its most direct way.

Weston Wamp:  That was Trevor Potter, the former Chairman of the Federal Election Commission, and the founder of the Campaign Legal Center. He agreed to sit down with me and walk me through the current state of super PAC abuse. When it comes to exposing the flaws in America's campaign system, Trevor is the man. He was famously Stephen Colbert's lawyer in 2011 when Colbert has set up his own super PAC to poke fun at the absurdity of the new campaign finance law.

Trevor Potter:  Colbert, Super PAC transfer, activate.

Weston Wamp:  Colbert and Stewart made a mockery of the idea that coordination wouldn't take place.

Stephen Colbert:  I cannot coordinate with you in any way.

Weston Wamp:  But listen to Trevor Potter explain what a farce the notion of super PACs independence really is.

Trevor Potter:  What's happening in real life is that what the court described as wholly, completely, totally independent, almost now never occurs. And the reason is that candidates and outside spending groups, super PACs other independent spenders, will go to the same advertising agency. So the advertising agency, will know what the candidate wants and what message they want, and then they'll, the super PAC comes along and says, will you help me? Now, legally, the advertising agency is supposed to have distance, a wall between the people helping the super PAC and the people helping the candidates. Time and time again, we have seen instances where that doesn't happen. We've actually had federal candidates say, "I talked to the such and such group and they're going to run advertising for me next week."

Weston Wamp:  Later in my conversation with Potter, he clarified that it's not just the spending of money that's being coordinated so that the messaging is synced between the super PAC and the campaign. But candidates have also found ways to raise money for super PACs, that are again, supposed to be independent.

Trevor Potter:  You have presidential candidates go to events for super PACs to thank the donors or even to solicit money, but that gets a little tricky cause you, there's limited in how much you can solicit. So what you routinely see and what the leaders of Congress in both parties do is go to a room full of literally billionaires and say, "this PAC is doing great work. It's really important to us retaining control of Congress. I hope you will contribute to it. I'm going to leave the room now and John Smith is going to tell you how you can do that." The congressional leader walks out of the room and John Smith now says, "I'd like you to write $100,000 check made out to X," and that's happening all the time.

Weston Wamp:  In 2015 to take full advantage of his place as the Republican front runner, Jeb Bush was so clever in the way that he played the super PAC game that he revealed all new holes in the system. He managed to raise money for a super PAC and coordinate messaging without breaking the law.

Trevor Potter:  Jeb Bush in the last election created a super PAC before he became a candidate. So he went through this elaborate game of saying, "I'm thinking of considering whether to explore running for president," so technically he wasn't the candidates, so he said, "the rules don't apply to me, I can create this PAC. I can raise unlimited sums and unlimited contributions from wealthy individuals." As I recall, raised about a hundred million dollars. And then once it had all the money, which he had raised, he'd been in the room, he'd actually made direct asks, cause he wasn't a candidate so he was allowed to.

Once all that money was raised, he had his campaign manager go over and run it. He then had announced he was a candidate and took contributions in the limited $2,700 a person amounts, but the real money was in the super PAC, and that's what was being spent on advertising by somebody who knew exactly what the campaign plan was because he'd written it.

Weston Wamp:  Stick with us. We're going to take just a short break.

We're back. Let's not lose sight of the reason this is all terrifying. After all, if coordination is legal, then so is corruption. Remember the Supreme Court said they weren't worried about corruption when they made their 2010 decisions because they truly believed that the money that would be going to PACs would be independent of the campaigns. Well, not only are billionaire funded super PACs and campaigns working together, and even worse, unintended consequences emerged. All that a candidate needs to run successfully for office is a single major donor running a coordinated super PAC.

In 2012 Rick Santorum and Newt Gingrich both had campaigns that were basically kept alive by single major donors. The more you think about it, the truth is all of this makes the Bush-Gore campaign feel like the good old days. Now you've got billionaires that can not only give unlimited amounts, but often they're the ones controlling a campaigns paid advertising. So I started wondering, what are the old school practitioners like Mark McKinnon think about the way campaigns have gone to hell in such a hurry.

Mark McKinnon:  The most significant change is the impact that big donors have on campaign. I mean, there's anecdotal evidence everywhere about big dollar donors just acting like puppet masters with these candidates. It's humiliating really to see what these candidates are going through.

Weston Wamp:  In talking to Mark, I was specifically curious if donors before the super PAC era ever had influence on campaign messaging. That certainly wasn't the case when I was growing up around politics. So I asked McKinnon straight up, did donors ever tried to influence the ads you're running back in your Bush campaign days.

Mark McKinnon:  Yeah. And that's a real, uh, evolution of what's going on and again, highly, highly problematic. You know, donors have always been around, but they were never, you know, part of the campaign strategy or messaging or execution. And now they often are. That's just fraught with minefields everywhere for a whole lot of reasons. But again, you know, they often have their own interests that aren't the interests of the broader electorate, and that's how they got a lot of money. And that's why they give a lot of money.

Weston Wamp:  In some cases, super PACs have been a lifeline, keeping a campaign alive, maybe beyond when it should've been. But the current state of the game is so dysfunctional that one of the main concerns for guys like McKinnon is the candidates are losing control of their own message.

Mark McKinnon:  We saw some of it in 2004 with the Swift votes and in the primaries with McCain in South Carolina. You have all the party often anonymous, undisclosed donors that have, you know, there's freelance into our campaign, but we didn't have no control.

Not only do we not have control over it, legally we can't have any interaction with them and that's hugely problematic because they are rogue entities that have no oversight from the campaign or the candidates.

Weston Wamp:  So let's recap, since Citizens United, the amount of money in our elections has trended steadily upwards. For years, Republican candidates relied more on large dollar donors. It's just a fact. And Democrats emphasized trying to build small dollar donor machines. There's been sort of a tug of war for many on the left. Do they give in and rely on super PACs and big outside money groups to win elections? Or do you run cleaner, small dollar campaigns on principle?

In 2016 Donald Trump and Bernie Sanders both proved you can convince Americans to give millions upon millions of dollars, one small donation at a time when you're running for office. Then came a plot twist in 2018. Democrats swept the House in a historic wave, in part because liberal, dark money outside groups.

Liberal ones spent more than their conservative counterparts for the first time since the Citizens United decision. Now we're into 2020 and most candidates running in the Democratic Presidential primary are focusing on small dollar donors. Why are they doing this? Well, it's in part because in 2019, Democrats in the House all joined together and passed a sweeping political reform package known as HR One, and it was passed on a purely party line vote.

You've probably heard about it, and this set the stage for the Democratic Presidential hopefuls to begin pledging to fix the political system if they win office, including cleaning up the outside money that we've been telling you about in this episode. But make no mistake, super PACS and dark money groups are just biding their time and waiting for the most opportune moment to crash down on the election. Who will they support or attack? And when? That's what we have to watch out for.

Now it's that time, late in the episode where you may be feeling hopeless. How do we fix it? Can we fix it? Potter says yes, but the solution is twofold.

Trevor Potter:  The first thing is you need an FEC that's going to enforce the law, and we absolutely don't have that now.

Weston Wamp:  Trevor's right. In case you missed it as of this episode, the FEC has been effectively shut down since September 1st, 2019 because it doesn't have enough commissioners to do its basic job. That's crazy.

Trevor Potter:  So how do we fix this? You're going to have to have a commission that says, Congress said, "if you coordinate, it's not permissible." The Supreme Court said, "you can only do this unlimited spending if you don't coordinate" and we're going to enforce it. Either Congress or the FEC. Congress could write a law that lays out exactly what is coordination. Or the FEC could write a rule that lays out exactly what is.

Weston Wamp:  There are a few ways that this could be addressed. First, president Trump and the Senate could work out a deal to nominate and confirm six new commissioners who are committed to enforcing the law. The other option is for Congress, once and for all, for all of our good to define coordination. And right here there's some good news. Republicans and Democrats in the Congress have done just that.

The Political Accountability and Transparency act spells out in regular language what coordination is. So let's encourage Congress to pass this common sense legislation so that our elections can take a step back toward democratic norms. The stakes are high. Mark McKinnon said it better than I could have at the end of our conversation.

Mark McKinnon:  We have a system in which the candidates can't even control their own campaign. And when others can control the campaigns, and it's being driven not by principle, for my funny profit, you know, you're going to end up with a system that badly fucked up, and it is.

Weston Wamp:  Next episode, the most gripping political reform fight in a generation and why a simple statement that politicians shouldn't pick their voters is lighting a fire behind reformers across the country.

Thanks for listening to Swamp Stories presented by Issue One, the country's leading political reform organization that unites Republicans, Democrats, and Independents To fix our broken political system. Please subscribe to the podcast and share it with your friends.

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I'm your host, Weston Wamp. Thank you to executive producer, Ethan Rome, producer William Gray and editor Parker Tan from parkerpodcasting.com. Swamp Stories was recorded in Tennessee, edited in Texas, and can be found wherever you listen to podcasts.

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