For a moment, just imagine the good you could do for your country with $1.6 billion at your disposal.
Perhaps, you would use the money to end hunger, or maybe you’d finance housing initiatives to give our homeless population a safe place to lay their heads. You could even overhaul our broken education system with massive injections of funds to public schools and expansive scholarship programs for impoverished youth.
Well, when aging and elusive billionaire Barre Seid neared 90 years old, he found himself in that exact position. With no children to inherit his insanely profitable company, Tripp Lite, he didn’t want his fortune going to just any cause ¹.
He wanted his wealth to create epochal change and shape U.S. politics with his own ideologies for generations to come.
Through what his associates termed “attack activism”, Seid donated the entirety of his company to The Marble Freedom Trust — a notorious 501(c) non-profit widely known for bankrolling conservative activism.
Seid’s donation, which totaled $1.6 billion after the sale of the company, is considered the single largest contribution to a political advocacy group ever.
This donation was far from his first political contribution, though. Between 1996 and 2018, Seid had been a regular anonymous donor to various conservative non-profits and religious groups — his grants totaling nearly $755 million. He also routinely donated to organizations run by long-time friend and business associate Leonard Leo².
Leo is best known for his role as judicial advisor to former President Donald J. Trump. He was directly responsible for appointing more than 200 federal judges and the confirmation of conservative justices Neil Gorsuch, Brett Kavanaugh, and Amy Coney Barret to the Supreme Court².
But how exactly did Seid contribute hundreds of millions of dollars without public scrutiny until the end of his life?
It was made possible through what is known as dark money political contributions.
Dark money approved by The Supreme Court
When political candidates and groups raise money, they must disclose the source of their donations to the federal government. All candidates, political parties, and PACs are required by law regularly report the names of all donors that contribute over $200 to the Federal Election Commission (FEC)³.
However, corporate entities and certain non-profits — specifically those categorized under section 501(c) of the tax code — can be exempt from reporting their election spending³. As long as they do not financially contribute to a specific candidate or campaign, they can use their money as they see fit to sway public opinions.
We see this regularly in our campaign advertisements that call “for the election or defeat of federal candidates.”
Before 2007, corporations and non-profits were prohibited from contributing to political ads, according to the FEC. But the Supreme Court ruling in the case of Wisconsin Right to Life v. FEC opened the door for these organizations to start spending on advertisements.
At first, they were only allowed to pay for issue advocacy — a type of ad that raises awareness for a particular societal problem, like limited abortion access, without directly endorsing a specific candidate.
But the notorious 2010 Citizen’s United Supreme Court decision further eroded what was left of the separation between corporations, non-profits, and political ad spending.
Once the ruling for Citizens United v. FEC broke, corporations, including 504(c) non-profits, could begin spending unlimited money on campaign ads and other political tools to convince the public to vote for or against a particular politician.
As long as these organizations never contribute financially to a candidate’s campaign, which is illegal under federal election law, they do not need to report their jaw-dropping spending to the FEC. And the donors whose money they use to fund their activities do not need to be disclosed.
They can remain in the shadows, just like Barre Seid did for most of his life.
And in a more recent 2022 Supreme Court ruling, in the case of FEC v. Ted Cruz for Senate, more federal oversight into campaign spending was eroded.
What does this mean for Free & Fair elections?
This blatant lack of transparency in campaign spending hurts everyone and is one of the most significant threats to our democracy in recent history.
As we have seen with Seid’s secret donation of $1.6 billion, many of these organizations have access to unimaginable amounts of wealth. Wealthy Americans with strong political ideologies can use their funds to dominate our election cycle and ultimately advocate for policy that harms American voters and families.
To quantify Seid’s donation and the power it carries, just think about what $1 billion means in terms of youtube ad spending.
It costs a typical advertiser just $2,000 dollars to reach 100,000 viewers. For only 1 million dollars, a small fraction of Seid’s contribution, an ad could reach approximately 50 million people. With over $1.5 billion left over, multiple ads could be created and played repeatedly for peanuts to sway public dialogue.
And because these donations are not reported, there is no room for federal or public oversight. Most Americans do not know that this type of political spending is even allowed under federal law. Nor do they know exactly who is responsible for the massive injections of cash these organizations routinely supply to various political initiatives.
But what is arguably most dangerous is that multi-million dollar corporations can buy political support for their personal causes without any oversight. With enough funding, these anonymous donors can directly sway public support and ultimately decide who will win elections at the state and federal levels.
These funds then make it impossible for organizations that play by the rules and are held to strict federal reporting standards, like us at New Coalition PAC, to fight back against these dark money organizations and their damaging policies.
We need to end dark money political donations and require that all significant political contributions be reported to the FEC. We must return to the level of federal oversight over campaign contributions that was allowed before The Supreme Court decision in the case of Citizen’s United.
Our political system should work for the average citizen, not only the ultrawealthy.
That’s why we must always ensure that the political donations we make as individuals go to organizations that advocate for Free & Fair elections and can not be bought by multi-million dollar influxes of cash from anonymous donors.
SOURCES:
- ProPublica & The Lever – “How a Billionaire’s “Attack Philanthropy” Secretly Funded Climate Denialism and Right-Wing Causes”
- ProPublica & The Lever – “How a Secretive Billionaire Handed His Fortune to the Architect of the Right-Wing Takeover of the Courts”
- The Center for Public Integrity – “What is political ‘dark money’ — and is it bad?”
