By Anna Massoglia and Karl Evers-Hillstrom, OpenSecrets
March 17, 2021
March 15-21 is Sunshine Week, a national initiative celebrating open government and access to public records. Undisclosed spending by political actors undermines transparency and voters’ ability to make informed decisions.
The 2020 election saw more than $1 billion in “dark money” spending at the federal level, a massive sum driven by an explosion of secret donations boosting Democrats in a historically expensive cycle.
That’s according to an estimate from OpenSecrets. The billion-dollar sum includes a whopping $660 million in donations from opaque political nonprofits and shell companies to outside groups. In 2020, dark money groups preferred to bankroll closely-tied super PACs rather than spend the money themselves — politically active nonprofits that do not disclose their donors reported roughly $88 million in direct election spending to the Federal Election Commission. The remainder of the total is made up of spending on “issue ads” targeting candidates online and on the airwaves.
Democrats have consistently called for closing loopholes in campaign finance law that allow secret donors to bankroll pricey political ads. But that hasn’t stopped them from using secret funds to win elections. Of donations and spending reported to the FEC, liberal groups directed more than $514 million in dark money into the 2020 election, overshadowing around $200 million that boosted Republicans.
Liberal dark money groups overshadow conservatives
Biden’s presidential bid attracted around $174 million in support from anonymous donors, more than six times the $25.2 million in dark money contributions and spending boosting President Donald Trump’s unsuccessful re-election effort.
Future Forward USA, a new hybrid PAC, poured around $100 million into ads backing Biden in the presidential race and took nearly $61 million from its affiliated 501(c)(4) nonprofit in the final months of the election.
Each of the top pro-Biden super PACs, including Future Forward USA, American Bridge 21st Century, Priorities USA Action and Unite the Country, received multi-million dollar contributions from the Sixteen Thirty Fund. The expansive secret donor network poured more than $57 million into liberal political committees at the federal level during the 2020 election cycle. Anti-Trump 501(c)(4) nonprofit Defending Democracy Together also chipped in, spending more than $15 million opposing Trump or boosting Biden.
After years of dark money overwhelmingly boosting Republicans, this marks the first presidential election cycle where dark money benefited Democrats. That’s a continuation from the 2018 midterm elections when Democrats benefited from more dark money than their Republican counterparts at the federal level for the first time since Citizens United.
The 2020 election attracted record amounts of donations from dark money groups to political committees like super PACs. These groups are required to reveal their backers, but they can hide the true source of funding by reporting a non-disclosing nonprofit or shell company as the donor. By using this tactic, dark money groups can get around a 2020 court ruling that attempts to require nonprofits running political ads to reveal their donors.
Super PACs funded almost entirely by dark money groups spent around $38 million combined during the 2020 election cycle. Political committees at least partially funded by contributions from untraceable sources poured a record $2 billion into 2020 elections.
Groups aligned with Democratic or Republican party leadership account for around $3 in every $10 of dark money in 2020 elections. Party-tied dark money groups directed around $320 million into ad spending and political contributions to allied super PACs. With this much secret money, the public is left in the dark about which wealthy donors may have gained influence with party leaders, who dominated negotiations over COVID-19 legislation and other priorities over the last year.
Senate Republican leadership-aligned 501(c)(4) nonprofit One Nation was the top spender, shelling out around $125 million between political contributions and ads. The Senate Leadership Fund, a super PAC tied to Senate Majority Leader Mitch McConnell (R-Ky.) that shares staff and resources with One Nation, received more than $85 million from the dark money group.
The American Action Network, Republican House leadership’s 501(c)(4) nonprofit, poured over $9 million into political advertising boosting GOP congressional candidates and donated $30 million to the Congressional Leadership Fund, the House Republicans’ super PAC that shared staff and resources with the American Action Network.
Senate Democrats’ Majority Forward poured around $85 million into 2020 elections with tens of millions of dollars on TV ads before beginning to report its spending to the FEC when the disclosure window went into effect, according to OpenSecrets research in partnership with the Wesleyan Media Project.
On top of direct spending, Majority Forward gave more than $51 million to Senate Majority PAC, a super PAC that shares the dark money group’s staff and resources, along with millions more to various pop-up super PACs. The Senate Democratic leadership aligned dark money group provided the vast majority of funding for Let’s Turn Colorado Blue and North Star PAC election cycle.
Around $46 million more in party-aligned spending and dark contributions from unknown donors came from Senate Democrats’ other dark money affiliate, Duty and Honor, according to ad data and FEC contribution records. Around $17 million more in 2020 spending and contributions can be traced to congressional Democrats’ dark money group, House Majority Forward.
Democrats push ahead with bill to close dark money loopholes
Despite winning elections on the backs of secret donors, Democrats are continuing their decade-long push to close loopholes that allow dark money to persist. Their bill to overhaul elections, ethics and campaign finance laws passed the House along party lines earlier this month and Democrats introduced the Senate version in a press conference Wednesday.
H.R. 1, titled the For the People Act, would require any group spending more than $10,000 on political ads to disclose all donors who gave $10,000 or more. Nonprofits would have the option of establishing a separate fund that would disclose only donors paying for political ads. This donor disclosure also applies to a nonprofit’s donations to other political groups, like super PACs.
The bill would remove a provision in current law that prevents the Internal Revenue Service from determining whether 501(c)(4)s are truly acting as “social welfare” groups and not political actors. These nonprofits are not supposed to devote more than half of their activities to political purposes, but a provision included in government spending packages effectively prevents the IRS from enforcing its own rules. Regardless, Democrats have urged Treasury Secretary Janet Yellen to more aggressively scrutinize dark money groups.
Democrats’ election bill would require political groups to sign a certification pledging that their spending is not coordinated with a candidate. It expands what activities count as coordination and aims to prevent a candidate’s former staffer from launching an outside group to support them. Those provisions are designed to end the proliferation of dark money groups and super PACs closely connected with candidates and party leaders.
The bill would also make numerous changes to the FEC, which was without a quorum for much of 2020 and whose ideologically divided commissioners have struggled to address dark money. The agency would have five members rather than six, with an independent serving as the tie-breaking vote. The bill would also give FEC staffers more leeway to investigate complaints of campaign finance violations. In the meantime, Biden is being asked to break with precedent and pack the FEC with nominees who would more strongly enforce campaign finance laws.
Democrats are keenly aware that they’ve benefitted from dark money in recent elections, because Republicans often remind them. In last week’s Senate Judiciary Committee hearing on dark money influence over judicial confirmations, Republicans frequently noted the secret spending discrepancy in the 2020 election.
“Now, Republican colleagues have faced massive attacks leveled through Democratic front groups,” Sen. Sheldon Whitehouse (D-R.I.) said during the hearing. “So perhaps this slime machine can be a bipartisan concern.”
Still, Republicans have defended dark money and remain opposed to efforts to unmask secret political donors. Sen. Thom Tillis (R-N.C.) recently equated Democrats’ small-dollar donors to dark money, an inaccurate claim. McConnell has said he will vigolorgusly block H.R. 1, arguing that increased disclosure would chill donors’ free speech rights by deterring them from spending money on political advocacy. Wealthy donors have said in private they make dark money donations to avoid backlash from their customers and employees.
Since the 2010 Citizens United ruling, Democrats have said they will not “unilaterally disarm” and let Republicans dominate the new political spending vehicles enabled by the Supreme Court. Even liberal dark money groups, like the Sixteen Thirty Fund, have expressed support for ending dark money.
“We have lobbied in favor of reform to the current campaign finance system (through H.R. 1), but we remain equally committed to following the current laws to level the playing field for progressives in this election and in the future,” Sixteen Thirty Fund Executive Director Amy Kurtz told Politico last year.
End Citizens United, Let America Vote Action Fund and the National Democratic Redistricting Committee are launching a $30 million effort to support the bill’s passage. Meanwhile, Republican-aligned dark money groups American Action Network and Heritage Action are running ads opposing Democrats’ legislation, focusing mostly on its provisions to expand voting and create a public fund to match small-dollar donations.
-Researcher Andrew Mayersohn contributed to this report.