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Brett Kavanaugh stars in one heavily-promoted digital ad calling on senators to confirm President Trump’s Supreme Court nominee. We don’t know who donated the $791,160 for nonprofit America First Policies’ Kavanaugh ad campaign, nor the $30 million the group reportedly collected last year. But it’s a safe bet that the White House knows.
America First Policies, having registered with the government as a 501(c)(4) social welfare nonprofit, does not disclose its donors even as it maintains a revolving door between it, the Trump campaign, and the White House. The group has spent millions of dollars on campaign-style ads touting President Trump and his policies on taxes, healthcare, and more. Its proximity to the nation’s most powerful elected office makes AFP the most urgent example of a growing practice and problem: elected officials who use nonprofits to raise unlimited advertising funds from secret donors.
The president’s top political advisers created AFP in January 2017 and have led its fundraising and strategy ever since. Its founders included the Trump campaign’s digital director, Brad Parscale, manager Rick Gates, and campaign advisers to Vice President Mike Pence. Other former Trump campaign aides have held leadership positions, including Curtis Ellis as senior policy adviser and Carl Higbie as director of advocacy. In March 2017, following the first failed attempt to reform healthcare, the White House dispatched senior staffer Katie Walsh to make AFP more effective. Corey Lewandowski, who kickstarted the Trump 2016 campaign as its first manager, raised money for AFP until this past May.
To raise unlimited funds while shielding its donors, the group is supposed to avoid coordinating with candidates and not focus primarily on politics. That bar serves to stop donors from giving lavishly to what are essentially shadow campaigns and circumventing direct contribution limits that prevent corruption of candidates. Yet earlier this year, CNBC reported extensive cooperative efforts between AFP and three top pollsters for the 2016 Trump campaign. And early last year, President Trump named Brad Parscale, who serves as an adviser to AFP, manager of his 2020 campaign. Watchdog group Common Cause filed a complaint with the Federal Election Commission, demanding an investigation into illegal coordination. But the federal agency faces seemingly insurmountable partisan gridlock on controversial issues.
Staffed by some of the president’s closest aides, AFP has been able to raise and spend millions for political ads from anonymous donors:
Date Amount Spent* Subject President Trump Appearance
Aug. 2018 $1,200,000
Ad: “Confirm Kavanaugh”
Promoting Judge Kavanaugh for a Supreme Court seat (targeting Democratic senators in states with strong support for President Trump).
Footage of official announcement of Judge Kavanaugh as SCOTUS nominee.
May 2018 $1,500,000
Ad: “Support Haspel”
Advocating Gina Haspel’s confirmation as CIA director (targeting Democratic senators in red states).
Footage of speech at Conservative Political Action Conference.
Nov. 2017 $1,500,000
Ads: “An America First Tax Plan” and “Once in a Generation”
Promoting the GOP tax plan.
Footage of working in Oval Office, holding political rallies, and giving a speech.
June-Sept. 2017 $1,827,395
Ad: “Clear”
Supporting candidates Luther Strange for Senate and Karen Handel for House of Representatives.
Footage of speech and rally.
June 2017 $400,000 Ad: “Safe Again”
Promoting President Trump’s anti-terrorism stance.
Images from President Trump’s first foreign trip (Israel, Saudi Arabia, the Vatican, Belgium, and Sicily).
April 2017 $3,000,000 Ad: “Gary Palmer – Opposing Obamacare”
Pushing House Republicans to repeal Affordable Care Act.
Footage of speech.
Total Amount Spent $9,427,395
Total Amount Raised $30 million**
Donors: Still unknown
*Sources: Politico, America First Policies press releases, Politico Playbook, Washington Post,Bloomberg, Wall Street Journal, Federal Election Commission, Axios, political ads posted on the America First Policies YouTube channel.
**Source: Axios.
To be sure, President Trump isn’t the first president whose advisers helped promote his policy agenda via a lightly regulated nonprofit. In his second term, President Obama enjoyed the powerful support of Organizing for Action, a group created by his top campaign aides. Responding to critics, however, OFA elected to publicly disclose its donors even if it had no legal duty to do so. So far, AFP has not done the same.
We reported this year about the risks of corruption that arise when elected officials are able to raise unlimited advertising dollars through secretive nonprofits, especially from donors with business interests those officials can affect. In the absence of strong transparency laws, officials at other levels of government have exploited the nonprofit strategy. But America First Policies is the most prominent example of how close to power secret donors can get and why we need concrete reforms that bring accountability to these dark money groups.
https://truthout.org/articles/america-first-policies-promotes-right-wing-ideals-with-secret-donor-money/
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And:
IRS Drops Rule That Required Disclosure of Donors to Political Nonprofits
*president Donald Trump has just removed an old IRS rule that required specific types of nonprofit organizations to disclose the identities of their large donors.
As the Department of Treasury explained on its website:
The Treasury Department and IRS announced today that the IRS will no longer require certain tax-exempt organizations to file personally-identifiable information about their donors as part of their annual return. The revenue procedure released today does not affect the statutory reporting requirements that apply to tax-exempt groups organized under section 501(c)(3) or section 527, but it relieves other tax-exempt organizations of an unnecessary reporting requirement that was previously added by the IRS.
Nearly fifty years ago, Congress directed the IRS to collect donor information from charities that accept tax-deductible contributions. That statutory requirement applies to the majority of tax-exempt organizations, known as section 501(c)(3) organizations, receiving contributions that can be claimed by donors as charitable deductions. This policy provided the IRS information that could be used to confirm contributions to those organizations.
By regulation, however, the IRS extended the donor reporting requirement to all other tax-exempt organizations—labor unions and volunteer fire departments, issue-advocacy groups and local chambers of commerce, veterans groups and community service clubs. These groups do not generally receive tax deductible contributions, yet they have been required to list the names and addresses of their donors on Schedule B of their annual returns (Form 990).
As The New York Times reported, “the change, which has been long sought by conservatives and Republicans in Congress, will affect labor unions, social clubs and, most notably, many political groups like the National Rifle Association and the Koch network’s Americans for Prosperity, which collect what is known as ‘dark money.””
Treasury officials said the reporting change would protect privacy and reduce compliance costs for nonprofits, and that the IRS could still request donor information from groups in the rare event that it was needed for tax scrutiny.
“Americans shouldn’t be required to send the I.R.S. information that it doesn’t need to effectively enforce our tax laws, and the IRS simply does not need tax returns with donor names and addresses to do its job in this area,” Steven Mnuchin, the Treasury secretary, said in a statement on Monday evening.
“Treasury Secretary Mnuchin’s announcement is a thinly-veiled attack on transparency in political campaigns,” Adav Noti, senior director at the Campaign Legal Center and a former associate general at the Federal Election Commission (FEC), told Salon by email. “The information that he is allowing organizations to withhold from the IRS was one of the very few remaining protections for voters against the influence of foreign dark money in elections. So the administration has made a choice to deprive law enforcement agencies of the information they need to detect and deter illegal campaign spending by foreign powers.”
Noti’s concerns were echoed by Steven Rosenthal from the nonpartisan Tax Policy Center.
“There’s a lot to this administrative rule under the semblance of reducing paperwork,” Rosenthal told the Times. “It adds another layer of opaqueness to the tax-exempt funding.”
By contrast, Republican lawmakers — many of whom claimed that the existing laws had allowed the IRS to inappropriately target various political groups during the administrations of President George W. Bush and Barack Obama — celebrated the new policy.
Senate Majority Leader Mitch McConnell declared that it was “particularly welcome news to those of us who intently are focused on defending the First Amendment, for those of us who over the years have raised concerns during the last administration about activist regulators punishing free speech and free association. It’s a straightforward, common sense policy decision.”
Similarly, Rep. Kevin Brady of Texas, chairman of the Ways and Means Committee, declared that “for years, Members of the Ways and Means Committee have fought for an I.R.S. that is accountable to the taxpayer and does not target or single-out any person or entity based on their political beliefs.”
The Wall Street Journal also lauded the decision in an editorial on Tuesday:
Presidents swear an oath to “protect and defend the Constitution,” and that includes guarding against restrictions on political speech. So congratulations to Treasury Secretary Steven Mnuchin and Acting IRS Commissioner David Kautter for advancing that cause on the controversial issue of donor privacy.
Treasury announced Monday evening that the Internal Revenue Service will no longer require most 501(c) organizations to include donor names and addresses on their tax Form 990 Schedule B. Nonprofits have had to divulge those sensitive details for donations above $5,000. From now on, only 501(c)(3)s that receive a tax deductible benefit will have to provide such donor information. This new IRS revenue procedure will exempt some 45,000 nonprofits from the reporting rule, including unions and social-welfare groups.
Donor names are supposed to remain private, but the government has inadvertently revealed donor lists. IRS employees also used donor-information demands as part of their harassment of Tea Party organizations during the Obama Administration. State Attorneys General have even sought to require nonprofits to release Schedule B details to state regulators, with a goal of requiring public disclosure that could tee up donors for political harassment—a threat to free speech. The new IRS policy means states won’t be able to exploit this donor information as easily.
By contrast, Democrats condemned the decision as one that would only help the rich continue to remain unaccountable, with Sen. Jon Tester of Montana describing it as “the swampiest, darkest, dirtiest decision.”
This doesn’t mean that nonprofits are completely off the hook.
“Organizations still need to keep the identities of donors on file, and the IRS has the power to request that information,” Noti told Salon by email. “If there is reason to believe that an organization is illegally funneling foreign funds into U.S. elections, the Department of Justice or the Federal Election Commission could open an investigation.”
https://truthout.org/articles/irs-drops-rule-that-required-disclosure-of-donors-to-political-nonprofits/
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