FacebookTwitterRedditEmail

Using Shadowy “527 Groups,” Corporations Give Unlimited Dollars Directly to Members of Congress

Using Shadowy “527 Groups,” Corporations Give Unlimited Dollars Directly to Members of Congress Groups Allow Companies to Influence Legislation, Underscore Need for Reform

CounterPunch Wire Report

Corporations are using shadowy and little-noticed groups to put millions of dollars into the hands of lawmakers – a practice otherwise prohibited by federal campaign law – while seeking legislative favors, Public Citizen has found.

Public Citizen’s analysis of recent telecommunications, tobacco and money-laundering legislation shows that these groups, known as “527 groups,” enable corporations to gain access to lawmakers and shape legislation.

The 527 groups, products of an exemption carved in Section 527 of the Internal Revenue Code, enable lawmakers to directly amass huge quantities of “soft money” – unlimited contributions from individuals, corporations and unions. (Other soft money is given through political parties.) With the 527 soft money, politicians sponsor events that further their own careers, give money to state and local candidates, and pay for “get-out-the-vote” efforts.

A Public Citizen investigation of 25 leading “politician 527 groups” (non-politician groups will be the subject of a forthcoming report) found that it is difficult and sometimes impossible to learn which politicians have 527s, who contributes to them and what the groups spend money on. Although these politician 527s would be banned under pending campaign finance reform legislation, the defective disclosure apparatus will continue to hinder the tracking of soft money to the 527 groups set up by non-politicians, such as the Sierra Club and Republicans for Clean Air, that want to influence elections.

“The politician 527 groups are a nefarious mechanism for legalized bribery,” said Joan Claybrook, Public Citizen president. “They allow corporations to put unlimited amounts of money directly into the pockets of members of Congress. This corporate investment is for one purpose only: to shape the laws that Congress votes on and ultimately approves. They have corrupted our legislative process.”

Among Public Citizen’s findings, entitled Congressional Leaders’ Soft Money Accounts Show Need for Campaign Finance Reform Bills:

Virtually every congressional leader has his or her own 527. At least 61 members of Congress have their own groups, including 19 who created new ones in the past year.

In the one-year period from July 1, 2000 to June 30, 2001, the top 25 politician 527s collected more than $15.1 million. This suggests that these top groups would collect approximately $30 million in a two-year election cycle. (More recent reports for all 25 groups are not available although they were due to the IRS on Jan. 31, 2002.)

The majority of contributions to the top 25 groups from July 1, 2000, to June 30, 2001 came from 27 major industries (including individuals, such as executives, associated with these major industries) that gave at least $100,000.

The top six congressional leader 527s collected 81 percent of their contributions from corporations between July 1, 2000, and June 30, 2001.

The 527 politician groups remain shadowy due to flaws in the disclosure law and the Internal Revenue Service’s Web-based disclosure system. And 527s often appear to skirt the law by ignoring disclosure requirements and providing vague and misleading information.

In new policy investigations, Public Citizen found that:

Regional Bell telephone companies promoting deregulation of high-speed Internet service poured $277,666 into the 527s of House Speaker Dennis Hastert (R-Ill.), Majority Whip Tom DeLay (R-Texas) and Chief Deputy Whip Roy Blunt (R-Mo.) while their favored Tauzin-Dingell bill was considered in 2001. Republican leaders simultaneously maneuvered to advance the bill despite opposition among the House GOP rank and file. (A vote is scheduled Feb. 27.)

The 527 groups of Senate Majority Leader Tom Daschle (D-S.D.) and House Democratic Caucus Chairman Martin Frost (D-Texas) received $40,000 and $50,000 respectively from the Stanford Financial Group between July 1, 2000, and June 30, 2001. During this period, Stanford was fighting anti-money laundering legislation supported by the Clinton administration. Stanford gained access to the Texas Democratic delegation through Frost, and neither Democratic leader protested when key congressional Republicans sank the bill.

“Internet access, money-laundering, tobacco legislation – these are among the issues corporations tried to influence through 527s,” said Frank Clemente, director of Public Citizen’s Congress Watch. “These 527 groups are just one more reason that the Senate and President Bush must approve the pending campaign finance reform measure.”

Click here for a copy of Public Citizen’s report.

 

More articles by:

Weekend Edition
March 22, 2019
Friday - Sunday
Henry Giroux
The Ghost of Fascism in the Post-Truth Era
Gabriel Rockhill
Spectacular Violence as a Weapon of War Against the Yellow Vests
H. Bruce Franklin
Trump vs. McCain: an American Horror Story
Paul Street
A Pox on the Houses of Trump and McCain, Huxleyan Media, and the Myth of “The Vietnam War”
Andrew Levine
Why Not Impeach?
Bruce E. Levine
Right-Wing Psychiatry, Love-Me Liberals and the Anti-Authoritarian Left
Jeffrey St. Clair
Roaming Charges: Darn That (American) Dream
Charles Pierson
Rick Perry, the Saudis and a Dangerous Nuclear Deal
Moshe Adler
American Workers Should Want to Transfer Technology to China
David Rosen
Trafficking or Commercial Sex? What Recent Exposés Reveal
Nick Pemberton
The Real Parallels Between Donald Trump and George Orwell
Binoy Kampmark
Reading Manifestos: Restricting Brenton Tarrant’s The Great Replacement
Brian Cloughley
NATO’s Expensive Anniversaries
Ron Jacobs
Donald Cox: Tale of a Panther
Joseph Grosso
New York’s Hudson Yards: The Revanchist City Lives On
REZA FIYOUZAT
Is It Really So Shocking?
Bob Lord
There’s Plenty of Wealth to Go Around, But It Doesn’t
John W. Whitehead
The Growing Epidemic of Cops Shooting Family Dogs
Jeff Cohen
Let’s Not Restore or Mythologize Obama 
Christy Rodgers
Achieving Escape Velocity
Monika Zgustova
The Masculinity of the Future
Jessicah Pierre
The Real College Admissions Scandal
Peter Mayo
US Higher Education Influence Takes a Different Turn
Martha Rosenberg
New Study Confirms That Eggs are a Stroke in a Shell
Ted Rall
The Greatest Projects I Never Mad
George Wuerthner
Saving the Big Wild: Why Aren’t More Conservationists Supporting NREPA?
Norman Solomon
Reinventing Beto: How a GOP Accessory Became a Top Democratic Contender for President
Ralph Nader
Greedy Boeing’s Avoidable Design and Software Time Bombs
Tracey L. Rogers
White Supremacy is a Global Threat
Nyla Ali Khan
Intersectionalities of Gender and Politics in Indian-Administered Kashmir
Karen J. Greenberg
Citizenship in the Age of Trump: Death by a Thousand Cuts
Jill Richardson
Getting It Right on What Stuff Costs
Matthew Stevenson
Pacific Odyssey: Puddle Jumping in New Britain
Matt Johnson
The Rich Are No Smarter Than You
Julian Vigo
College Scams and the Ills of Capitalist-Driven Education
Brian Wakamo
It’s March Madness, Unionize the NCAA!
Beth Porter
Paper Receipts Could be the Next Plastic Straws
Christopher Brauchli
Eric the Heartbroken
Louis Proyect
Rebuilding a Revolutionary Left in the USA
Sarah Piepenburg
Small Businesses Like Mine Need Paid Family and Medical Leave
Robert Koehler
Putting Our Better Angels to Work
Peter A. Coclanis
The Gray Lady is Increasingly Tone-Deaf
David Yearsley
Bach-A-Doodle-Doo
Elliot Sperber
Aunt Anna’s Antenna
March 21, 2019
Daniel Warner
And Now Algeria
FacebookTwitterRedditEmail