Arkansans of the Year: Koch brothers
Charles and David Koch's money helps Arkansas Republicans gain legislative majority.
by David Ramsey
Page 2 of 4
The DLCC responded by committing resources to the state for the first time in recent history, spending around $1 million. Even with DLCC support, Democratic candidates in targeted races were outspent 3-to-1 if outside money is included, according to Martin.
All of this spending, unprecedented in legislative elections in Arkansas, has been a bit jarring, both to candidates and voters. The candidates themselves mostly still operate on shoestring budgets, and it's relatively easy for an unaffiliated group to outspend the actual campaigns. In local elections, a little bit of money goes a long way.
"It's unknowable in terms of how many actual dollars [AFP spent]," Democratic political consultant Michael Cook said. "Maybe it was a million, maybe it was [more], but it was a ton of money and I can just tell you ... talking with candidates across the state ... it was just a presence that was felt in these races."
AFP's mission statement explains that it is "committed to educating citizens about economic policy and mobilizing those citizens as advocates in the public policy process." The language about "educating" is no accident — the group is classified as a 501(c)(4) non-profit under the U.S. tax code, which requires it to operate "exclusively for the promotion of social welfare."
Here's where things get slippery. Groups like AFP can satisfy IRS rules as long as they are primarily engaged in promoting the common good and general welfare of the community. That means that the boundaries for allowable activity are exceedingly vague — advocating on the issues without explicitly endorsing or opposing a candidate counts as promoting social welfare (and they can make an explicit endorsement if they like, it simply can't be their primary activity and they have to report what they spent).
If that sounds like a giant loophole, it is. Media from AFP and other 501(c)(4) groups often named specific candidates and expressed clear approval or disapproval ("Jon Hubbard stood with us" or "Butch Wilkins voted to support President Obama's healthcare plan"). It simply avoided language like "vote for." AFP's education efforts just so happened to take place in 32 House and Senate districts that had competitive races. When the AFP bus tour made a stop in Mountain View, where Republican Missy Irvin happened to be running for Senate, Missy Irvin happened to be on hand. This was one of many stops that featured a cheap-gas giveaway to potential voters that showed up.
Yet because of the legal loophole for 501(c)(4)s, AFP does not have to disclose who its donors are, even as they engage in activity that appears obviously political. Oelke has presented AFP as a grassroots organization raising money within the state, but the public remains in the dark about who — and where — the group's funders are. As long as they remain nominally independent of the campaigns, there are no limits on how much they spend.
"Even though they claim to be a non-partisan organization, this election clearly showed that they were a shell organization for the Republican Party," DLCC spokesman Roth said (DLCC is a 527 organization that, unlike 501(c)(4)s, must disclose its donors).
While Martin said that she believed that strong candidates and a superior ground game would keep Democrats competitive, she said that the mammoth spending advantage that outside groups granted Republicans was difficult to overcome, and helped give them the House and Senate.
"It definitely swung things," she said. "Obviously the balance of power is different now. It would be foolish to say that didn't have any effect, because obviously it did."
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