Big Business Prefers GOP Over Democratic Super PACs

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By Michael Beckel
iWatch News | News Report
From The Center for Public Integrity

Republican-aligned super PACs have benefited from far more corporate cash than their Democratic counterparts — a revenue stream created in the wake of the controversial Citizens United U.S. Supreme Court decision two years ago.

The top two super PACs — the pro-Mitt Romney Restore Our Future and Karl Rove’s American Crossroads — have raised nearly $24 million in contributions from companies so far this election cycle, a Center for Public Integrity analysis has found. Donors include hedge funds, energy companies, dietary supplement makers and even a popcorn manufacturer.

The list includes a handful of Fortune 500 and other publicly traded corporations, but donors are more likely to be privately held businesses, often organized as limited partnerships or limited liability companies.

Businesses account for only about 5 percent of donations to the four most prominent Democratic super PACs. Labor unions, which were also given greater spending freedom thanks to the Citizens United decision, make up a much larger percentage of receipts.

Proponents of campaign finance deregulation have frequently downplayed the role of money from profit-making businesses to super PACs, but their presence worries campaign finance reform advocates.

Dems dwarfed by GOP super PACs

The Center’s analysis found that more than 100 companies have collectively donated more than $14.2 million to Restore Our Future, the pro-Romney super PAC started by aides of the GOP presidential nominee. That’s 17 percent of the $82 million the group has raised through the end of June.

Meanwhile, about two-dozen companies have combined to give $9.4 million to American Crossroads, the super PAC co-founded by top GOP strategists Rove and Ed Gillespie, who left American Crossroads in April to become a senior adviser to Romney’s presidential campaign. That’s about 23 percent of the $40 million the group has raised through the end of June.

The leading Democratic super PACs have struggled to keep pace with the GOP’s big-money operation.

Collectively, the four main Democratic super PACs have combined to raise about $48 million, according to their most recent campaign finance filings. These groups — Priorities USA ActionMajority PACHouse Majority PAC and American Bridge 21st Century — have relied extensively on unions and wealthy individuals for their funding.

Super PACs are legally required to disclose their donors on a regular basis with the Federal Election Commission, although they are not the only groups running political advertisements this year.

Politically active nonprofit organizations, which outspent super PACs in 2010 and are likely to do so again this election, are also spending big bucks. How much corporate money is flowing to politically active nonprofits, which are not legally required to publicly reveal their donors, is unknown. So far, the public has only had glimpses.

Corporate giving to nonprofits secret

For instance, last month, health insurer Aetna accidentally revealed that it had contributed $3.3 million last year to the conservative advocacy group American Action Network, a nonprofit organized under section 501(c)(4) of the U.S. tax code that was one of the biggest spenders on political ads during the 2010 midterm elections.

As Democrats in Congress have pushed the DISCLOSE Act as a means to create new reporting requirements for groups that make political ads, conservatives have questioned the necessity of doing so.

Senate Minority Leader Mitch McConnell, R-Ky., a fierce opponent of campaign finance regulations, has argued that Democrats are promoting the DISCLOSE Act to “create the impression of mischief where there is none” and that “the much predicted corporate tsunami simply did not occur.”

And in June, Republican lawyer Jan Baran, who filed a brief with the U.S. Supreme Court in support of Citizens United, told the New York Times that super PACs have not spent a “nickel” of Fortune 500 money. He was wrong. Baran could not immediately be reached to comment for this story.

In May, Florida-based Fidelity National Information Services became the second Fortune 500 company to donate to Restore Our Future, giving $75,000. The first was CONSOL Energy, which donated $150,000 to the super PAC last July.

Other publicly traded companies that have donated to Restore Our Future include Colorado-based Hallador Energy Co. ($100,000); Arizona-based Apollo Group, the corporate parent of the for-profit University of Phoenix ($75,000); Florida-based defense contractor B/E Aerospace, Inc. ($50,000); and Kansas-based payday lender QC Holdings ($25,000).

For-profit colleges for Romney

The Apollo Group was listed among the Fortune 500 in 2011, but its ranking fell to No. 504 this year. Records show that during the first half of 2012, the company spent roughly $400,000 on education-related lobbying, an arena where it has often clashed with the Obama administration.

Earlier this year, Apollo Group spokesman Rick Castellano told USA Today that the company backs “candidates who understand the important role Apollo Group plays in American higher education.”

Like Restore Our Future, American Crossroads has also drawn Fortune 500 backing.

Alpha Natural Resources gave $100,000 to the group in October. Alpha owns Massey Energy, the owner and operator of the West Virginia mine where 29 workers were killed in a 2010 explosion in the worst coal mining disaster in the United States since 1970.

In 2010, Ohio-based American Financial Group, another Fortune 500 firm, donated $400,000 to the conservative super PAC.

On the Democratic side, Caesars Entertainment Corp. is a Fortune 500 company that has given $150,000 to Majority PAC, which focuses on maintaining a Democratic majority in the U.S. Senate.

Conservative attorney Dan Backer of DB Capitol Strategies is among those who think corporate spending on elections is a good thing.

More corporate spending’ needed

“Corporations have issues too,” Backer said “They are subject to extraordinary regulation and over-taxation. Why shouldn’t they be able to say, ‘Vote against so-and-so’?”

“We need more corporate spending — not less,” he added.

Craig Holman, a lobbyist for Public Citizen, the nonprofit advocacy group founded by Ralph Nader in 1971, disagrees.

“Our elections should be run by individual Americans, not by artificial legal entities called corporations,” he said.

Holman said American Crossroads and Restore Our Future have raised a “substantial amount” from companies.

“These companies want to dismantle the regulatory regimes that govern their industries,” he said.

Restore Our Future was an effective attack dog against Romney’s GOP rivals during the presidential primaries and the group has now turned its sights on President Barack Obama. American Crossroads has aided conservative candidates in congressional races and has recently turned its attention to the presidential race.

Thanks to changes in campaign finance law in the wake of the 2010 U.S. Supreme Court’s Citizens United ruling, super PACs are legally allowed to accept unlimited contributions from individuals, corporations and unions to fund political ads that are not produced in conjunction with a candidate’s own campaign.

Money for something

Many of the corporate donors spend heavily on lobbying.

During the first half of 2012, financial sector titan Fidelity, whose revenues hit a record $5.7 billion in 2011, spent $50,000 on federal lobbying — all targeting the Federal Deposit Insurance Corp. over the implementation of the Dodd-Frank Wall Street reform law, a statute that Romney has pledged to overturn if elected to the White House in November.

During the same period, Pennsylvania-based CONSOL Energy spent nearly $1.8 million on state, federal and grassroots lobbying, records show. Areas of interest for the coal industry giant include clean air and water regulations, miner safety issues and the military’s use of biofuels.

Overall, most of the companies that have invested in either American Crossroads or Restore Our Future are privately held.

The top industry donor to Restore Our Future is William Koch’s energy company Oxbow Carbon, LLC, which has given $2.75 million, including $1 million from its subsidiary Huron Carbon, LLC. Koch himself has also given $250,000 to Restore Our Future.

William Koch is the brother of Charles and David Koch, the well-known conservative donors, but he does not own a stake in the billionaire brothers’ privately held Koch Industries.

Oxbow’s interests include coal, natural gas and petroleum.

Energy interests

Oxbow Carbon spent $1.1 million on federal lobbying during the first six months of 2012, a sum that included payments to a firm run by Heather Podesta, the sister-in-law of President Bill Clinton’s former chief of staff, John Podesta.

The company has lobbied on a variety of energy and environmental issues, such as greenhouse gas regulations and a desired land exchange in Utah and Colorado. Last year, records show the company also voiced concerns about proposed Department of Labor regulations, which Oxbow argued would “clearly and undeniably skew the employment landscape in favor of unionization.”

Five other private companies have given $1 million to Restore Our Future:

  • Florida- and Oklahoma-based Rooney Holdings, Inc.
  • Utah-based Eli Publishing, Inc.
  • Utah-based F8 LLC
  • Idaho-based Melaleuca, Inc., including Melaleuca of Japan, Inc., Melaleuca of Asia Ltd. Co. and Melaleuca of Southeast Asia, Inc.

CRC Information Systems, Waterbury Properties LLC and Fairbanks Properties LLC combined to give $1 million apiece to both Restore Our Future and American Crossroads. The three companies are all headed by Robert Brockman and all listed the same return address — a P.O. Box in Dayton, Ohio — on campaign finance filings.

Four other privately held companies have donated at least $1 million to American Crossroads so far this election cycle:

  • Contran Corp., the company of Texas super donor Harold Simmons ($2 million)
  • Crow Holdings, LLC ($1.5 million)
  • Whiteco Industries ($1 million)
  • TRT Holdings ($1 million)

American Crossroads has also received $400,000 this year from Weaver Popcorn, the Indiana-based maker of the popcorn brands Pop Weaver and Trails End, which is sold by Boy Scouts across the country. This donation is on top of the $325,000 the company gave in 2010.

Both Restore Our Future and American Crossroads received new contributions from companies in June, records show.

Among them, publicly traded Scotts Miracle-Gro Co., which touts itself as the world’s largest marketer of branded consumer lawn and garden products. Scotts gave $200,000 to Restore Our Future. Meanwhile, the privately held, Cincinnati-based car dealer Jeff Wyler Automotive Family, Inc. gave $50,000 to American Crossroads.

American Crossroads spokesman Jonathan Collegio declined to respond to specific questions.

When asked about the corporate contributions Restore Our Future has received, spokeswoman Brittany Gross said, “We don’t discuss our donors.”

Reprinted by permission from iWatch News

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