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Kip Dellinger

Political Money: A Journey into the Land of Hypocrisy


By Kip Dellinger

February 21, 2011 -- Well, here comes the Silly Season, just around the corner; that would be federal, state, and local elections with the quadrennial presidential election thrown in this year.

And, sure as the sun will rise tomorrow, we will hear the usual rants about the corruptive influence of money in politics – accompanied by misinformation from alleged knowledgeable folks who claim to understand the rules that govern the intersection of politics and money known broadly as campaign finance.

Most of what is represented as an effort to remove the corruptive influence of money from politics (or to put it under the jurisdiction of current office-holders), is simply an effort by those in power to retain their dominance.

They do this under the banner "campaign finance reform" by limiting the opposition’s opportunity to communicate its message or to prevent an insurgent from gaining traction in seeking political office – and, in state and local politics, to influence "legislation" in the form of ballot issues. Think about our beloved Santa Monica.

When the dominant political party – Santa Monicans for Renters' Rights – seized control of everything political some 33 years ago, it did so with generous funding from a few well-heeled liberals intent on turning the City into a little incubator for "economic democracy," as one Party "spiritual" leader characterized the movement (admitting that "we don’t use the ‘S’ word anymore – S being ‘socialism’").

Having seized power, those in control then imposed extraordinarily restrictive campaign finance rules and monetary limitations on local election funding -- all in the name of "good" or "clean" government. And all with a real intention of throwing roadblocks in the way of anyone choosing to oppose them. In politics, money is speech because, while speech may be "free," the opportunity to deliver it is not.

Invariably, efforts to impose restrictions on money come from the Democrat side, particularly the far left. That's because they see the advantage their general constituencies – unionized public employees such a police, fire and teachers – have in sending the message on the public dime, if only they can drown the political views of the opposition in the bathtub at birth.

The hypocrisy of all this is actually laughable since virtually all the "abuses" alleged by those champions for "clean" government were actually initiated by those folks.

It’s always amusing to see the left asserting that the corruptive influence of money in politics on a grand scale originated with Richard Nixon and the Committee to Re-Elect the President in 1972 – where the wealthy and their huge contribution corrupted politics. Somewhere, enabled by mainstream media (see, e.g., Media Matters and James Rainey of the LA Times) that either doesn’t know history or intentionally ignores it, they overlook the 1968 presidential campaign.

Today’s Democrat Party (and actually the lineage of many of those who founded SMRR) traces its heritage to Eugene McCarthy and his ant-Viet Nam War stance. Were it not for two Westsiders, McCarthy never could have mounted a campaign for President four years before Nixon’s transgressions.

Stanley Sheinbaum, a familiar name in Democrat and Los Angeles politics, funded McCarthy’s grassroots beginning with amounts that today would be considered an enormous sum of money. On a less grand but still significant scale, he was joined by others – including Santa Monica’s own Harold Willens, founder of and spokesman for a group of businessmen that advocated a unilateral nuclear freeze for the U.S.

Of very recent amusement is the silence in our mainstream news media and on the Left about the overt political activities of Media Matters, including coordination with the White House political professionals.

Media Matters is organized as a tax-exempt, educational organization to which tax-deductible contributions made are ostensibly for "charitable, educational" purposes. These contributions are deductible by donors for direct contributions and indirectly through funding from private foundations that received tax-deductible contributions.

This, in effect, results in a subsidy from U.S. taxpayers for the Left-Wing donors to those foundations, which are legally restricted from engaging in partisan politics. That is, the same folks who decry, and want to restrict, money in the political realm. Well, apparently only their opponents' money.

Of equal amusement are the "reformers" who want to engage in the "reform" of laws or court decisions with respect to laws that the reformers haven’t even read. They parrot the President’s assertion that Citizens United was wrongly decided by the Supreme Court, never having read the opinions of the court. They propose that "corporations" not be treated as individuals in applying "speech" laws – never mind that any such efforts would have adverse consequences for public employee union political activities (fire, police and teachers) as well for MSNBC, the Washington Post and LA and New York Times – all operating under corporate structures, mind you.

For the uninitiated and uniformed – Citizen United – did not "open the floodgates" to foreign monies sloshing around in our campaigns. And, historically, it was President Clinton and candidate Al Gore who had actually identified problems with illegal political donations from the Chinese including "bagmen" and contribution "laundering."

As for Super PACs, they are not a product of Citizens United, but of SpeechNow, a D.C. federal appeals court decision. And those politicians who voted for the McCain-Feingold legislation in the early 2000s have only themselves for blame for the rise of the Super PAC.

They were told by numerous other legislators and campaign finance lawyers that the campaign legislation restricting independent expenditures would, in fact, be ruled unconstitutional. And contrary to the smokescreen the Left tries to put up, contributions to Super PACs are fully transparent and available for scrutiny either through IRS or Federal Election Commission releases. The fact that some Super PACs do not report as timely as other PACs was a problem that the legislators could easily have rectified – but arrogantly refused to do.

Then there is the most misunderstood of entities involved in politics – the allegedly "evil" c4 organization – invariably described by the Left as allowing secret donors. The poster children of the Left are, of course, Charles and David Koch. But, wait, if the donors are "secret donors," how do we know it is the Koch brothers. Never mind.

Again, the Left rails about c4s. First, the term derives from the fact that these organizations seek tax-exempt status, as organized to promote social welfare, under Section 501(c)(4) of the Internal Revenue Code; contributions to the organizations by individuals do not qualify as charitable deductions as do contributions to Media Matters.

And, again, amusingly – the first use of the c4 organization on a grand financial scale in politics was by George Soros in the 2006 and 2008 election cycles. The left didn’t start whining until the Republicans copied their model and then raised a whole lot more money than the Democrats. The poster child of the angry left in the c4 arena is Crossroads GPS, the brainchild of Karl Rove (American Crossroads is a Super PAC and its contributors are fully disclosed in compliance with Federal election law).

Here’s what you don’t hear. A political action committee (‘PAC’, super or otherwise) or a 527 organization (which is similar to a PAC but not required to register with the Federal election commission, but with IRS instead) MUST be organized to support the election or defeat of a CANDIDATE. Absent a candidate there can be no PAC or 527 organizations.

So, how is an organization created to educate the public about issues such as gun control or gay marriage, sometimes in connection with ballot issues within a given state or local political subdivision?

Well, the c4 organization is the creature of choice and generally the only tax-exempt vehicle available for the purpose. This has been the case for over 50 years.

A classic example – probably forgotten in today’s world of 15-second attention spans – was the "educational" ad that aired it the summer and fall of 2008 that showed a bride unable to make it the alter due to obstacles and concluded with voice-over, "What if you couldn’t marry the person you love." That was it.

Of course it happened to air on TV during the midst of the Prop 8 campaign to outlaw same-sex marriage. It was produced by the c4 organization that was a companion to "Let Freedom Ring." The donor, long thought to be noted philanthropist and former Ambassador to Luxemburg, James Hormel. Strange, that those campaign reformers didn’t seem upset at all over the activities of that c4.

The fact that c4 organizations do not have to disclose the name of donors has been a feature of the income tax law all that time, and Congress has had myriad opportunities to change the rules and has not. This is not Karl Rove’s fault by any means.

What one concludes is that all one needs to do to determine if a campaign finance "reformer" has an ulterior motive – e.g. to deprive of speech someone she disagrees with – is to check to see if her lips are moving.

The views expressed in this column are those of Kip Dellinger and do not necessarily reflect the opinions of the Santa Monica Lookout and You may reach the editor or email Kip Dellinger at
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