Many liberals have an almost-religious faith in the ability of campaign finance laws to clean up politics. In the real world, however, political money always finds the loopholes. And in this regard, well-greased backers of campaign finance reform are among the best models. On Wednesday, Senate Rules Chairman Chuck Schumer, D-N.Y., will hold a hearing on the Disclose Act, which aims to force nonprofit advocacy organizations to publish the names of their member-donors. (It's important to keep in mind this distinction: Presently, neither 501(c)(3) nor (c)(4) non-profits have to disclose donor identity. Under Disclose, (c)(4) donors would be disclosed.)
Such disclosure helps Democrats use the bully pulpit and even the Internal Revenue Service to persecute donors to causes of which they disapprove. But it will not remove secret money from politics. For a model of how dark money will work in a Disclose world, donors need only look at one of the bill's sources of support -- the Democracy Alliance, a big-money liberal group that does not disclose its donor-members.
Democracy Alliance was formed as a taxable nonprofit group, so it would not be affected by Disclose -- even though some of its financial beneficiaries will testify in favor of the bill. Democracy Alliance's aim is to coordinate the efforts of wealthy liberals by directing them to a network of more than 100 preferred organizations, most of which officially or unofficially support the aims of the Democratic Party.
The Democracy Alliance explained in an April memo why it does not disclose its membership. “Many of our donors choose not to participate publicly, and we respect that,” the memo said. “The DA exists to provide a comfortable environment for our partners to collectively make a real impact.”
And why shouldn't Democracy Alliance donors like their privacy? Senate Majority Leader Harry Reid, D-Nev., hardly gives a single speech without demonizing conservative donors Charles and David Koch for their philanthropic activity. In that context, Democracy Alliance's secretive behavior seems justifiable.
Many other Americans would love a “comfortable environment” like Democracy Alliance provides, from which they can participate in public life without retribution from politicians or bureaucrats. Democrats, backed by Democracy Alliance dollars, are working to make this more difficult for those who support conservative causes.
President Obama's IRS has already been caught illegally leaking information about donors to conservative groups and attempting to enforce tax laws selectively against donors to conservative organizations. (This was separate from the IRS targeting of conservative groups.) Given the bureaucracy's demonstrated hostility toward conservative donors, Democracy Alliance has a lot less to lose from the Disclose Act.
Democracy Alliance also supports many groups with structures that fall outside Disclose requirements. Many are educational nonprofits which nonetheless privately discuss political aims. Powerline's John Hinderaker recently obtained the pitch that the American Constitution Society, a 501(c)3, made to Democracy Alliance's members. The purportedly non-political organization claimed credit for successfully getting judicial nominees confirmed, shifting the political balance of the D.C. Federal Circuit Court of Appeals, and advocating changes to Senate rules.
Democracy Alliance donors are to be congratulated for quietly supporting causes they believe in. Maybe they should stop supporting Democrats' efforts to make it harder for their fellow Americans to do the same.