A Primer on Political Spending

by Sister Barbaba Jennings, coordinator
Midwest Coalition for Responsible Investment

What is political spending?
When a company directly contributes to a federal or state candidate’s campaign, it must list the candidate and the amount given. (Most companies give to both Democratic and Republican candidates, federal and state.)

Why? Because the Supreme Court decision Citizens United vs Federal Election Commission (2010) says that gifts to Political Action Committees (PACs) are free speech but the amounts must be reported to the public.

Examples: In this election cycle, Boeing has directly contributed $3.8 million, Exxon Mobil: $1.4 million, and Monsanto: $724,139.

What is a SuperPac?
A SuperPac is a very large political action committee, sometimes called a 527, that raises money and then indirectly contributes money to candidates or to political action committees like the Democratic/Republican Governors Association, Citizens for Climate Action, or NRA. A SuperPac can accept unlimited donations; they can work in close proximity to political campaigns but are not allowed to “coordinate” advertising. Often the groups then in turn can contribute to the 501(c)(4) “civic leagues” or “social welfare organizations” for campaigns.

How much money do public corporations spend on lobbying legislators?
No one knows. Sometimes corporations don’t even know.

What is “dark money”?
Dark money is money that corporations pay to “civic leagues” or “social welfare organizations” (501(c)(4)) or nonprofits such as American Exchange Legislative Council (ALEC), or to for-profits such as the Chamber of Commerce, National Association of Manufacturers, etc. These groups do not need to disclose what they spend on lobbying federal legislators. They do not even have to disclose these lobbying expenses to their board members or to the member company.

Example: The U.S. Chamber of Commerce has spent $18 million in this election cycle, but most of their members do not know to which candidates, which issues, which
501(c)(4)/nonprofits, etc.

How much do corporations pay to their lobbyists directly employed?
These are usually disclosed. Examples of expenditures in 2016: Boeing: $2.8 million, Exxon Mobil: $1.5 million, Monsanto: $578,554.

I’ve heard of the Koch Brothers. Who are they?
Charles and David Koch are billionaires of the oil industry. They have founded and supported numerous right-wing 501(c)(4) organizations like Americans for Prosperity, American Energy Alliance, National Right to Work Committee, Tea Party Patriots, etc. These groups lobby legislators, buy election media, etc.

Which companies are transparent on their political spending and lobbying?
According to the Center for Political Accountability (2015 report), here’s the ranking of some companies from best to worst (disclosure grade of political spending out of 100):

  • Monsanto: 94.3
  • Hershey: 90 
  • Conoco Phillips: 87.1 
  • Wells Fargo: 87.1 
  • Ameren Corp: 85.7
  • Boeing: 84.3
  • Express Scripts: 84.3
  • Target: 84.3
  • Kellogg: 81.4
  • Starbucks: 77.1
  • AT&T: 72.9
  • Emerson Electric: 54.3
  • Wal-Mart Stores, Inc: 21.4

There are 57 companies that disclose 0.0 of political spending including Berkshire Hathaway, Netflix and Ralph Lauren.

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