What does Obama's reversal on super PACs mean?

Feb 07, 2012

Fearing a tide of spending by outside conservative groups, President Obama is giving his blessing to a pro-Democratic Party "super PAC" that will work to help his reelection, his campaign said late Monday.

The move marks a clear political risk for Obama, who has staked much of his political career on opposition to the outsized role of "secret billionaires" and other monied interests while also attempting to win reelection in a struggling economy.

What does Obama's decision to give his blessing to a super PAC, something he was once against, mean for him and his campaign? Was it the right decision? Did he have a choice?

Post reporter Dan Eggen chatted about this issue live at 1 p.m. ET.

Read: Obama gives blessing to a super PAC

Hello everyone. We've got waves of campaign finance developments, along with the tide of election spending, in the news these days. Let's talk super PACs!

What were President Obama's considerations as he thought about whether to accept this super PAC funding? Might there now be other super PAC's forming to help him?

First, to make sure others are up to speed: President Obama's campaign announced last night that he was throwing in the towel on his somewhat-distant relationship with a super PAC, called Priorities USA Action, that was formed to help him but had terrible results raising money (unlike Obama's campaign itself, by the way). 

Various campagn leaders and advisers, including Jim Messina and David Axelrod, have portrayed the decision as one of pragmatism--Axelrod said on MSNBC this morning that Republican groups were effectively "pointing guns" at the campaign.

It appears that a lot of events came together in recent weeks to push them in this direction, particularly the overwhelming dominance of super PACs in the GOP primaries and their ability to raise far more money than Democratic equivalents.

Despite rules defining how Super PACs and the respective campaigns they support/promote may and may not coordinate with said campaigns, such coordination has been known to happen.  Does the Obama campaign declared any stance or made any assurances that such 'coordination' will be monitored/publicized?

This is one of the most vexing issues to get a handle on with super PACs, and even the legal professionals disagree on the details.

To sum up: what most of us would think of as "coordination" often does not count as such under rules administered by the Federal Election Commission. They can coordinate on scheduling and other such logistics, and some conservative attorneys argue it goes further--that the only thing that matters is that the candidate and campaign aren't deciding on ad details and that sort of thing.

For example, candidates can raise money for super PACs, but they can't explicitly ask for more than the $2,500 individual contribution limit under FEC guidelines. 

And yes, this is precisely as idiotic as it sounds.

By the way, Mitt Romney has appeared at fundraisers for a super PAC called Restore Our Future, and Harry Reid and Nancy Pelosi have also lent their names to fundraising efforts by friendly super PACs. The Obama team says they will stop short of direct fundraising appeals, and Obama himself will not appear at Priorities events, though his  underlings will.

I'm having trouble keeping track of all the different groups. What's the difference between a super PAC, a 527 group, and a 501 group?

You know what? I have trouble too, and I'm supposed to write about this stuff!

Your examples are essentially apples and oranges. Let's step back: The FEC oversees election laws, which include limits on contributions, spending reports, coordination rules with outside groups, etc.

The IRS, of course, enforces tax laws. 527s and 501(c) designations are IRS terms, and refer to the status of groups under the tax code. Super PAC, by contrast, is a slang term for an FEC designation officially called (take a deep breath) independent expenditure-only committees. 

Super PACs were born in 2010 after decisions in Citizens United, SpeechNow and other cases basically stripped away many previous limits on outside spending. They are overseen by the FEC, and must report their spending and donors publicly (though often with a nice handy lag time).  Some super PACs, as it happens, are also 527s as far as the tax code is concerned. 

Most 501(c) nonprofit groups, by contrast, do NOT have to report their donors because their "primary purpose" is not elections or politics, but instead "social welfare" or one of many other designations. The latter is a big fat loophole for secret money that I wrote about in a story published today:


That whole thing just made me a bit dizzy.

Do you think Obama voters will be/are unhappy with his decision to "throw in the towel?"  Will this affect how people vote for him...like say independants?

There's no doubt some Obama supporters, especially on the progressive left, may be angry about this. The whole money-in-politics issue is a matter of deep importance to a small but vocal segment of the Democratic base, though frankly it's not clear it ever moves many votes. 

The question is how much this reverberates into negative results at the polls or in contributions to the campaign. It's probably worth remembering that the campaign reformers howled in 2008 when Obama decided to skip public matching funds to raise as much money as possible. We're all aware how that turned out.

Campaign officials are also beating the drum on this whole "we will not tie one hand behind our back" argument, which may have resonance for many supporters who otherwise don't like the idea. 

How have we seen campaigns change since super PACS were declared OK by the Supreme Court? How is their money changing the game?

First, just to get a technical misunderstanding out of the way that is very common: the Supreme Court did not actually approve or create super PACs, per se. In Citizens United, the court ruled 5-4 that corporations (and by unspoken extension unions) could spend unlimited funds on elections as long as they didn't coordinate with campaigns. Then in a case called SpeechNow, an appellate court--drawing in part on Citizens United--struck down limits on contributions to advocacy groups. Then the FEC, taking heed of those two rulings, determined that certain kinds of groups--now known as super PACs--could marry those two ideas together, taking unlimited funds from almost anyone and then spend that money on elections.

I think the change is pretty clear in the GOP primaries, where super PACs have outspent the actual campaigns. Look at Newt Gingrich: Does anyone believe he was not helped, perhaps kept alive, by $11 million in super PAC money from a friendly casino magnate and his family?

Much of it comes down to an inordinate amount of influence for a quite small number of people. For example,A quarter of the money raised by Mitt Romney and his super PAC came from just 41 people: http://wapo.st/xJY9Cp

What it means is that Obama thinks that the liberal media will get his back and not accuse him of brazen hypocrisy and flip-flopping. Which I'm already seeing in the pages of this very newspaper. But Romney will make absolute hay out of it, and we'll be hearing about it until the last poll closes on Election Day.

Hmm. Well, our stories and everyone else's I've seen have led with the fact that he's reversing course on this issue, so I'm not sure how that point is being ignored. It's pretty much the whole reason we're writing about it!

Is there any indication of whether all this new spending is having an impact, or are people just tuning it out? I don't think the 2010 elections necessarily provide much evidence since that was going to be a bad Democratic year no matter what. Basically, are all the campaign consultants winning big by running a con on all these folks donating?

There's always a bit of magic arts to political spending, of course, in the sense that it's hard to definitively prove these kinds of impacts. That said, it's hard to look at South Carolina and Florida and not conclude that super PAC money had at least some impact on the outcomes. 

Do you see these super PACs that are nominally aligned with different candidates attacking the other candidate for being insufficiently conservative or liberal i.e. will we see Priorities USA in the general running ads about Romney flip-flopping on abortion or being the Godfather of Obamacare and Restore Our Future running ads about Obama not getting single payer or not winding down Afghanistan or whatever the liberals are upset at him over?

Excellent question! I think there's no doubt we will see this, and in fact we've already seen glimmers of this in the primaries. (My favorite so far were pink leaflets handed out by a Democratic super PAC in South Carolina extolling Romney's support for gays and lesbians.)

AFSCME, the public sector union, also paid for $1 million in ads in Florida attacking Romney for his ties to a firm convicted of Medicare fraud--in a GOP primary!

This is similar to a previous question, but what fundamentally changed with C. U. that wasn't there before? It seemed like there was huge money in politics long before these new "Super Pacs".

This is a great question, and one that I ask a variety of attorneys and others myself. After all, Sheldon Adelson, the casino billionaire helping Newt Gingrich, spent tens of millions on an advocacy group in 2008. Rich guys in particular have usually had an outlet for their money in politics if they desired.

The general conclusion seems to be, pardon the cliche, a perfect storm. Basically the Citizens United decision, and others both before and after it, have cleared the decks entirely and have removed many of the hazy doubts that probably depressed spending in the past. Remember that most of the liberal 527 groups behind hundreds of millions of dollars in spending in 2004 were in fact hit with massive fines after the fact because they broke the rules. At this point most of those rules no longer exist.

Picking up on the efficacy question, do you think the Super PACs will have more impact in primary races rather than general elections?

I think the impact on the general could also be profound the way things are shaping up. Remember, a huge amount of the $240 million+ that the conservative American Crossroads group plans to spend will be doled out in congressional races, not the presidential contest (though they will probabyl revolve around Obama, so it's sort of a wash in that sense). 

I would also say the Obama campaign has clearly concluded it won't just be an issue in the primaries.

OK,  folks, I'm afraid we've already exceeded our chat contribution limits. Thanks much for taking the time, and I hope it was interesting for everyone.


In This Chat
Dan Eggen
Dan Eggen has worked at The Washington Post since 1997, when he started as a Metro reporter based in Northern Virginia. He joined the National Desk in 2001 to cover the Justice Department and national-security issues. He was assigned to the White House to cover the end of the Bush administration in 2008, and has written about lobbying, campaign finance and the role of money in politics since 2009. Eggen was part of a team that won a Pulitzer Prize for National Reporting in 2002, and was also part of a Pulitzer finalist entry in 2005. A Midwest native, Eggen lives in Washington with his wife and two daughters.
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