GOP Uses New Loophole to Crush Democratic Party in Fundraising

Democrats raised barely a tenth of the Republican haul through the new mechanism.

<a href=:"http://www.shutterstock.com/pic-170786798/stock-photo-man-putting-money-in-suit-jacket-pocket-concept-for-corruption-bribing-paying-or-business-wealth.html?src=V6-XVBFdjIInO-hD6IWD_A-1-14">Source</a>/Shutterstock

Fight disinformation: Sign up for the free Mother Jones Daily newsletter and follow the news that matters.


Last December, the outgoing Congress slipped language into a spending bill that created a loophole allowing donors to make much larger contributions to political parties. Both parties supported the rule change at the time. But only one has been able to capitalize on it. According to filings last week, the Republican National Committee has raised nearly 10 times as much as its Democratic counterpart from donors who took advantage of the new loophole.

Following the 2010 Citizens United Supreme Court decision that ushered in an era of unlimited donations to outside groups backing political campaigns, the super-PACs supporting presidential candidates have brought in eye-popping hauls. Jeb Bush’s super-PAC has raised more than $100 million, and a single donor cut a $10 million check to a Ted Cruz super-PAC. Party committees, which have seen their influence diminished as outside money flows freely, have tried to get creative in boosting their fundraising totals. The RNC, which will spend heavily on both the presidential race and congressional battles next year, has been much more successful: It’s raised $63 million this year, including $7.7 million in the month of July. The DNC has raised just $36.4 million, and $4.9 million in July.

That’s a reversal from the last presidential election cycle. In July 2011, as the 2012 election loomed, the DNC had raised $50.6 million, to $43 million for the RNC.

A substantial portion of the Republican advantage comes from the new loophole. Previously, donors could contribute a maximum of $32,400 per year to the party. Now they can give not only $33,400 to the main fundraising accounts of the RNC and DNC (the same amount as last year, adjusted for inflation), but an additional $100,200 to three auxiliary fundraising accounts. That means an individual donor can now give a total of $334,600 a year to either party.

Six-figure donations have flowed to the RNC under the new rules, while Democrats have struggled to find people willing to write such large checks. The RNC has raised nearly $11.1 million from donors who gave to the new auxiliary accounts (ostensibly set up for legal costs, building costs, and the party conventions next summer). In July alone, the RNC had 12 different donors cut checks for $50,000 or more.

The DNC has raised just $1.3 million for these new accounts since the beginning of the year, much of it coming from transfers made by Democratic politicians with cash to spare in their own campaign accounts. In July, the DNC raised only $500,000 for these accounts and had just four donors who wrote checks over $50,000.

Part of the imbalance may come from Republican donors who already have their checkbooks out. Several of the big donors to the RNC in July are major supporters of presidential candidates. The largest contribution to the RNC by far was the $668,000 in donations from Hushang Ansary and his wife. Ansary was part of the Shah of Iran’s inner circle and served as the Shah’s ambassador to the United States before the Iranian Revolution. The Ansarys have donated $2 million to Right to Rise, the super-PAC backing Jeb Bush. Similarly, South Florida financier Bill Edwards donated $360,000 to the Bush super-PAC and $83,200 to the RNC in July.

Several major backers of Wisconsin governor Scott Walker also wrote large checks to the RNC. Ted Kellner and Jon Hammes, owners of the National Basketball Association’s Milwaukee Bucks, who just got Walker’s approval for $250 million in public financing for a new arena, donated a combined $200,000 to Walker’s super-PAC and $150,000 to the RNC in July. Anthony Scaramucci, a New York fundraiser who has taken a lead fundraising role for Walker, donated $33,400 to the RNC’s headquarters account.

In addition to the main committees, each party has two separate arms to raise funds for House and Senate races. Here, too, Republicans hold a lead over Democrats, both in overall fundraising and in donations to the new auxiliary accounts. The National Republican Congressional Committee, which supports House Republicans, has raised $46 million this year, including $3.4 million to the new accounts. The Democratic equivalent, the Democratic Congressional Campaign Committee, out-raised the NRCC by about $690,000 in July. But it still lags overall, with only $40.7 million raised in 2015, of which just $978,000 went to the new accounts.

AN IMPORTANT UPDATE

We’re falling behind our online fundraising goals and we can’t sustain coming up short on donations month after month. Perhaps you’ve heard? It is impossibly hard in the news business right now, with layoffs intensifying and fancy new startups and funding going kaput.

The crisis facing journalism and democracy isn’t going away anytime soon. And neither is Mother Jones, our readers, or our unique way of doing in-depth reporting that exists to bring about change.

Which is exactly why, despite the challenges we face, we just took a big gulp and joined forces with the Center for Investigative Reporting, a team of ace journalists who create the amazing podcast and public radio show Reveal.

If you can part with even just a few bucks, please help us pick up the pace of donations. We simply can’t afford to keep falling behind on our fundraising targets month after month.

Editor-in-Chief Clara Jeffery said it well to our team recently, and that team 100 percent includes readers like you who make it all possible: “This is a year to prove that we can pull off this merger, grow our audiences and impact, attract more funding and keep growing. More broadly, it’s a year when the very future of both journalism and democracy is on the line. We have to go for every important story, every reader/listener/viewer, and leave it all on the field. I’m very proud of all the hard work that’s gotten us to this moment, and confident that we can meet it.”

Let’s do this. If you can right now, please support Mother Jones and investigative journalism with an urgently needed donation today.

payment methods

AN IMPORTANT UPDATE

We’re falling behind our online fundraising goals and we can’t sustain coming up short on donations month after month. Perhaps you’ve heard? It is impossibly hard in the news business right now, with layoffs intensifying and fancy new startups and funding going kaput.

The crisis facing journalism and democracy isn’t going away anytime soon. And neither is Mother Jones, our readers, or our unique way of doing in-depth reporting that exists to bring about change.

Which is exactly why, despite the challenges we face, we just took a big gulp and joined forces with the Center for Investigative Reporting, a team of ace journalists who create the amazing podcast and public radio show Reveal.

If you can part with even just a few bucks, please help us pick up the pace of donations. We simply can’t afford to keep falling behind on our fundraising targets month after month.

Editor-in-Chief Clara Jeffery said it well to our team recently, and that team 100 percent includes readers like you who make it all possible: “This is a year to prove that we can pull off this merger, grow our audiences and impact, attract more funding and keep growing. More broadly, it’s a year when the very future of both journalism and democracy is on the line. We have to go for every important story, every reader/listener/viewer, and leave it all on the field. I’m very proud of all the hard work that’s gotten us to this moment, and confident that we can meet it.”

Let’s do this. If you can right now, please support Mother Jones and investigative journalism with an urgently needed donation today.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate