By Nino Mtchedlishvili
Boston University Statehouse Program
Over the past 15 years, nonprofit groups have dramatically increased their power by funneling black money into political campaigns. The roots of this practice are found in Citizens United v. Federal Election Commission, the Supreme Court ruling that struck down decades-old financial restrictions on campaigns and allowed businesses and outside groups, including nonprofits, to spend unlimited funds on elections .
External financial influence on political and electoral campaigns has long been a part of American politics. However, the impact has grown significantly since the decision by Citizens United, which critics say challenged US democracy and encouraged political corruption.
The issue of transparency related to donors and contributors also creates a campaign finance labyrinth. Regulated by the Internal Revenue Service, a 501(c)(4), nonprofits can have unlimited spending on political activities without ever disclosing their donors if their primary purpose is “social welfare.” However, a clear definition of a primary objective or the calculation rule is not provided.
Supreme Court Justice Anthony Kennedy explained in the majority opinion in the Citizens case that the disclosure of information “allows the electorate to make informed decisions and give appropriate weight to different speakers and messages.” He said technological developments would make the disclosure process more efficient.
“With the advent of the Internet, timely disclosure of expenses can provide shareholders and citizens with the information needed to hold corporations and elected officials accountable for their positions and their supporters,” Kennedy wrote in the majority opinion.
However, according to OpenSecrets, a nonpartisan, nonprofit research group that tracks money in American politics and its effect on elections and public policy, “the generally accepted test is that less than half of the activities of 501(c)(4) nonprofit organizations may be political”. , and in order to stay under the 50% threshold, some black money groups exchange anonymous money in complex networks.
Maurice Cunningham, a UMass-Boston professor and author of “Dark Money and the Politics of School Privatization,” examined the campaign finance plan behind the 2016 Massachusetts charter school referendum.
He described how wealthy white donors supported the expansion of charter schools through so-called “social welfare” organizations like Families for Excellent Schools, using women and children of color in advertising and concealing the actual funding sources while impacting public policy votes. Cunningham said the FES spent nearly $22 million, but only $317,000 went directly to women and minority-owned businesses.
Cunningham said the Office of Campaigns and Political Finance can track down the black money. However, disclosure is only available when the office officially requires it.
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