An Unusual $1.6 Billion Donation Bolsters Conservatives

Unusual, indeed, Grey Lady.

In 2010 the Supreme Court decided Citizens United v Federal Election Commission, ruling 5-4 that corporations have the same right to political speech as any other person and can pay for as much constitutionally protected free speech as they like.   The rationale given by Anthony Kennedy was that transparency about who was donating the money would alleviate any concerns about hidden hands manipulating American politics, since Americans would know who funded various political messages. 

In practice, and under the laws of political nonprofits, the hands of the billionaires who shape our politics, including spending $580,000,000 in “dark money” to engineer the appointment of a 6-3 doctrinaire far right Supreme Court majority,  remain eternally hidden.  One such 90 year-old billionaire made the news yesterday by a generous $1,600,000,000 tax deductible, perfectly legal, gift to Federalist Society superstar Leonard Leo, principal architect of our 6-3 Federalist Society Supreme Court.

 I’ll let Heather Cox Richardson tell this grotesque story, which was reported in yesterday’s NY Times (link above, at top):

Today’s big news is an eye-popping $1.6 billion donation to a right-wing nonprofit organized in May 2020. This is the largest known single donation made to a political influence organization.

The money came from Barre Seid, a 90-year-old electronics company executive, and the new organization, Marble Freedom Trust, is controlled by Leonard A. Leo, the co-chair of the Federalist Society, who has been behind the right-wing takeover of the Supreme Court. Leo has also been prominent in challenges to abortion rights, voting rights, climate change action, and so on. He announced in early 2020 that he was stepping back from the Federalist Society to remake politics at every level, but information about the massive grant and the new organization was broken today by Kenneth P. Vogel and Shane Goldmacher of the New York Times. 

Marble is organized as a nonprofit, so when Seid gave it 100% of the stock in Tripp Lite, a privately held company that makes surge protectors and other electronic equipment, it could sell the stock without paying taxes. The arrangement also likely enabled Seid to avoid paying as much as $400 million in capital gains taxes on the stock. Law professor Ray Madoff of Boston College Law School, who specializes in philanthropic policy, told the New York Times: “These actions by the super wealthy are actually costing the American taxpayers to support the political spending of the wealthiest Americans.”

This massive donation is an example of so-called “dark money”: funds donated for political advocacy to nonprofits that do not have to disclose their donors. In the 2010 Citizens United v. Federal Election Commission (FEC) decision, the Supreme Court said that limiting the ability of corporations and other entities to advertise their political preferences violates their First Amendment right to free speech. This was a new interpretation: until the 1970s, the Supreme Court did not agree that companies had free speech protections.

Now, nonprofit organizations can receive unlimited donations from people, corporations, or other entities for political speech. They cannot collaborate directly with candidates or campaigns, but they can promote a candidate’s policies and attack opponents, all without identifying their donors. 

“I’ve never seen a group of this magnitude before,” Robert Maguire of Citizens for Responsibility and Ethics in Washington (CREW) told Casey Tolan, Curt Devine, and Drew Griffin of CNN. “This is the kind of money that can help these political operatives and their allies start to move the needle on issues like reshaping the federal judiciary, making it more difficult to vote, a state-by-state campaign to remake election laws and lay the groundwork for undermining future elections.” Our campaign finance system, he said, gives “wealthy donors, whether they be corporations or individuals, access and influence over the system far greater than any regular American can ever imagine.”

source

What could go wrong?