Last fall, a shadowy conservative political action committee called Citizens for Sanity began running ads in Ohio attacking Democratic Senator Sherrod Brown for his stance on immigration policy, claiming that he favored “spending tax dollars on cities that shield criminal illegals.” The same group also ran more general “anti-woke” spots, asserting Democrats “used to care about the middle class, [now they] only care about race and gender.” In key battleground states, the group has also sponsored snarky billboard campaigns and newspaper ads that feature messages like “no one is free until all pansexuals have free housing.” During the 2022 midterm elections, the group spent millions of dollars on online ads warning that Democrats have “erased our southern border” and favored policies that put “criminals first.”
Citizens for Sanity placed ads costing more than $40.5 million in four battleground states in 2022, according to an estimate by AdImpact. It is run by former Trump Administration officials who also work for America First Legal. That group was founded in 2021 by xenophobic former Trump adviser Stephen Miller, and it has sued the Biden Administration over its immigration policies. No one knows exactly where Citizens for Sanity gets its funding. As a 501(c)(4) “social welfare” nonprofit, the group can avoid disclosing its donors.
Aside from some stories about racist ads Citizens for Sanity ran during baseball game broadcasts in 2022, the organization has attracted almost no national media attention. Sadly, this scant coverage is typical of the corporate media’s inadequate reporting on the millions of dollars in untraceable—or “dark”—money flowing into our elections.
Groups like Citizens for Sanity epitomize the problem of dark money in American politics. Anna Massoglia, editorial and investigations manager for OpenSecrets, which tracks spending on campaigns and lobbying, in an interview, defines dark money as “funding from undisclosed sources that goes to influence political outcomes, such as elections.”
In 2010, the U.S. Supreme Court decision in Citizens United v. Federal Election Commission (FEC) held that legal restrictions on independent political expenditures by corporations, unions, and nonprofits violate the First Amendment. A 2010 lower court decision, SpeechNow.org v. FEC, ruled that organizations may raise and spend unlimited amounts on electioneering messages as long as they do not coordinate with candidates and campaigns. Together, Massoglia says, these rulings “ushered in a proliferation of dark money that is largely unchecked.”
Massoglia says that since 2010, OpenSecrets has tracked “more than $2.8 billion in dark money going into U.S. elections . . . but the actual total is likely even greater.” The group tracked more than $162 million in dark money contributions to super political action committees (super PACs) reported to the FEC in 2023, which Massoglia says is only a portion of the total dark money being spent.
Much of the dark money currently flooding into elections comes from tax-exempt 501(c)(4) “social welfare” nonprofits, which can conceal the names of their donors but cannot legally spend the majority of their budgets on political activity. However, such organizations are permitted to funnel unlimited funds to tax-exempt 527 organizations such as super PACs whose main purpose is influencing elections and policy debates. Unlike 501(c)4s, 527 groups can spend as much as they want on political messaging but must disclose their donors. 501(c)(4) organizations can also spend money on opposition research or polling that might guide the crafting of ads run by super PACs. Moving funds through networks of 501(c)(4)s—which often donate money back and forth among one another—allows wealthy donors and corporations to obscure their political expenditures.
“It very much emulates money laundering in some cases,” explains Massoglia, “but it is legal.”
In addition to routing money through 501(c)(4) nonprofits and super PACs, wealthy donors have at their disposal other methods of shielding their political spending from public scrutiny.
David Armiak, research director and investigative journalist at the Center for Media and Democracy (CMD), notes in an interview that, increasingly, brand new nonprofits “that haven’t filed any IRS disclosure yet” are formed and start running issue ads or targeting candidates just weeks before voters go to the polls. Such pop-up groups—usually super PACs or 501(c)(4) nonprofits—typically don’t have to file with the IRS until late November, meaning they can hide the names of their funders until after an election has been held.
Moreover, Armiak says “donor advised funds [DAFs]”—a type of financial account created to make charitable donations—are “increasingly being used . . . by nefarious actors” to anonymously underwrite tax-exempt charities engaged in various sorts of issue advocacy.
Matt Corley, chief investigator at Citizens for Responsibility and Ethics in Washington (CREW), points out that “there are various ways that an organization that might want to have an outsized political impact, without technically violating the law, can spend money” without having to disclose it. For example, ads that mention candidates, but don’t urge people to vote a certain way, that are aired on broadcast or cable television more than thirty days before a primary or more than sixty days before a general election do not have to be reported to the FEC as “electioneering communications.” Under current regulations, independently sponsored online political ads that do not explicitly advocate for or against specific candidates can be run right up to Election Day without being reported to the FEC. As Corley explains, this loophole shows that “the technology and the reality of how politics is practiced has very much outstripped the law.”
Dark money ads can have a particularly outsized impact on down-ballot races for school boards, state legislatures, judgeships, and various statewide offices. For instance, since its founding in 2014, the Republican Attorneys General Association (RAGA) has spent lavishly in an effort to elect Republicans to the position of top law enforcement officials in dozens of states. According to OpenSecrets, the group spent at least $8.9 million through a variety of super PACs to defeat Democratic state attorney general candidates in the 2022 elections.
As a section 527 organization, RAGA must disclose its donors, but some of those donors are 501(c)(4) organizations that do not have to disclose their funding sources. According to research by the Center for Media and Democracy (CMD), since 2014, the Concord Fund, a 501(c)(4) group closely affiliated with conservative attorney and judicial activist Leonard Leo, has contributed more than $17 million to RAGA. In the first half of 2023 alone, the Concord Fund gave RAGA $1 million. Other top funders of the group in 2023, according to CMD, included tobacco companies Reynolds American ($262,800) and Phillip Morris ($250,000), Amazon ($150,235), and the U.S. Chamber Institute for Legal Reform, an affiliate of the U.S. Chamber of Commerce working to limit the damages victims can legally recover from corporations ($125,000).
Minnesota Attorney General Keith Ellison, who successfully prosecuted former Minneapolis police officer Derek Chauvin for the murder of George Floyd, faced a barrage of negative ads in 2022, funded by the super PAC Minnesota for Freedom, which was in turn financed largely by RAGA. According to the Federal Communications Commission (FCC), Minnesota for Freedom purchased roughly $1.5 million worth of ads attacking Ellison, who narrowly won re-election.
State attorney general elections are not the only down-ballot races awash in dark money. In the past few years, school board contests have seen significant inflows of unaccountable political spending, usually from nonprofits pushing charter schools or conservative culture war themes. For instance, in 2023, the City Fund, a national pro-charter school group, bankrolled in part by billionaires Reed Hastings and John Arnold, donated $1.75 million from its affiliated super PAC to Denver Families for Public Schools, a 501(c)(4) nonprofit that backed three pro-charter school candidates for the city’s school board. All three candidates won.
Although most on the left tend to think of dark money as exclusively a tool of Republicans and conservatives, the fact is that Democrats and liberals also benefit heavily from opaque political spending. According to OpenSecrets, so far this year, President Joe Biden has enjoyed more dark money support than his challenger, Donald Trump. Armiak says most progressives have just given up on the fight against dark money influence because “so many organizations, advocacy groups, and campaigns depend on dark money now.”
It would be inaccurate to suggest that the establishment press never covers the influence of dark money on our politics. In August 2022, for example, The New York Times broke the news that Leo’s Marble Freedom Trust had received one of the largest political donations in history, $1.6 billion, from the reclusive billionaire Barre Seid, to fund a vast network of foundations, think tanks, and political nonprofits. In 2022 and 2023, major news outlets covered the bribery trial of former Ohio house speaker Larry Householder, which helped shed light on dark money spending by electric utility company FirstEnergy. Yet, over the years, the corporate media have missed or minimized as many stories about dark money as they have covered.
David Armiak says, “I don’t think the mainstream media does a good job of following the money in general. Put dark money aside. A lot of times they are not connecting the dots and talking about influential organizations or individuals in providing context for readers.”
For instance, he contends that every time Leonard Leo’s groups are mentioned in the news, Leo’s enormous “Barre Seid trust fund” ought to be mentioned as well. The fact that this doesn’t happen is a grave disservice to the public.
Armiak also argues that the major news outlets consistently ignore the use of donor advised funds like Donors Trust that support hate groups such as the white supremacist website VDARE. CMD has “done stories on it, and mainstream media doesn’t really cover this stuff,” Armiak notes.
Massoglia suggests that national news media tend to give more attention to conservative dark money spending while downplaying equally significant spending by Democratic super PACs and 501(c)(4)s.
Corporate media organizations also typically fail to cover stories about complaints against dark money groups filed with the FEC. Over the past decade, for instance, CREW has submitted dozens of such complaints against super PACs and 501(c)(4) organizations at the state and national level. Very few of these complaints have attracted any major media coverage.
The establishment press not only underreports the influence of dark money groups on politics, but they also consistently fail to inform the public about legislative battles surrounding the regulation of dark money.
As Juliana Broad reported in a July 2023 article for CMD, state-level Republican lawmakers across the country are pushing legislation that would prohibit state officials and agencies from collecting or disclosing information about donors to nonprofits, including donors to 501(c)(4) organizations that spend money on politics. The bills these lawmakers are promoting are based on the so-called Personal Privacy Protection Act, model legislation authored by the American Legislative Exchange Council (ALEC), a policy-development organization financed by the Koch network of rightwing foundations, millionaires, and billionaires. According to Broad, since 2018, Alabama, Arizona, Arkansas, Indiana, Iowa, Kansas, Mississippi, Missouri, New Hampshire, New York, Oklahoma, South Dakota, Tennessee, Utah, Virginia, and West Virginia have all adopted some version of this ALEC anti-disclosure act. Similar bills were introduced in Louisiana, Nebraska, North Carolina, and Pennsylvania but never ratified.
In 2022, voters in Arizona overwhelmingly passed Proposition 211, the Voters’ Right to Know Act. It requires PACs spending at least $50,000 on statewide campaigns to disclose all donors who have given more than $5,000, a direct reversal of the ALEC-inspired legislation previously adopted by the state.
Conservative dark money groups Arizona Free Enterprise Club and Americans for Prosperity, both underwritten by hundreds of thousands of dollars from the Koch network, challenged the law in court on First Amendment grounds. Judges have dismissed their lawsuits three times so far.
The wave of ALEC-inspired state laws criminalizing the disclosure of nonprofit donor information has gotten some coverage in assorted state, local, and regional media. But to date, there has been almost no coverage of the viral spread of such laws by the national, agenda-setting news media. The victory of the Voters’ Right to Know Act in Arizona was reported by The Washington Post and The Wall Street Journal, and dissected by Jane Mayer in The New Yorker. However, national news media have given virtually no attention to the series of Koch-backed lawsuits challenging the law in the two years since.
As citizens, we need more transparency about who is spending money to influence our politics and exactly how much money they are throwing around. Every news organization in the country—whether corporate or independent—should be advocating for the full disclosure of donors and an end to the flood of dark money drowning our democracy.