Who’s Buying our Midterm Elections?

BILL MOYERS: This week on Moyers & Company, the corrupting influence of money in politics.

ANDY KROLL: This is the era of the empowered one percenter. They’re taking action. And they are becoming the new headline players in this political system.

KIM BARKER: People want influence. It’s a question of whether we’re going to allow it to happen, especially if we’re going to allow it to happen and nobody even knows who the influencers are.

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BILL MOYERS: Welcome. It’s barely spring and already the spending for this year’s midterm elections is three times higher than it was on the very day the Supreme Court issued the Citizens United decision back in 2010. That one fired the starting gun that set off the mad dash for campaign cash.

Look at this headline: “Billionaires use super PACs to advance pet causes.”

And this: “Federal super PACs spend big on local elections.”

Right. Unlimited and secret cash is no longer just for the White House or Congressional races – it’s even being thrown at state and municipal races – right down to County Sheriff and school board.

I could go on, but don’t take my word for it. Listen instead to two of the best journalists covering the world of money and politics. Kim Barker reports for the independent, non-profit news organization ProPublica. She specializes in “dark money” from those so-called “social welfare” groups that keep the identity of their donors secret.

ANDY KROLL: works in the Washington bureau of “Mother Jones” magazine. He’s a muckraking journalist whose exposés have opened eyes to campaign finance corruption as well as malfeasance in Congress and in the banking business. Welcome to both of you.

KIM BARKER: Thanks for having us.

ANDY KROLL: It’s great to be here.

BILL MOYERS: Both of you have talked about— covered and talked about dark money. Exactly, for the benefit of my viewers, what is dark money?

KIM BARKER: Dark money— these are organizations that can take unlimited amounts of money from billionaires or corporations or unions or anybody. And then turned around and spend money on political ads without saying who their donors are. They don’t have to tell who the money came from. They do have to say what it’s being spent on. And where it’s going. But they don’t have to say who the donors are.

BILL MOYERS: Yeah, where does all this money go? I mean, it seems to me to be frank, it sometimes sounds like a racket, you know? Lots of money raised. It goes to the campaign managers. It goes to the strategist. It goes to the television stations. And you really wonder if so much of it isn’t taken off along the way. Profit margins and all of that.

ANDY KROLL: It’s absolutely a self-enrichment process for the consultants and the ad makers, you know? The “mad men” of American politics. And all the different players, the political professionals in this process. I mean, one aspect of all of this dark money sloshing around in our politics, as Kim and I have written about a lot is that, you know, these folks on the left and the right pass money around between different organizations, you know? Americans for a Better Tomorrow passes it to Americans for Better Leadership passes it to Americans for a Better Leadership and a Better Tomorrow.

And all along the way, someone is taking a cut. A consultant has to be attached to these organizations as this dark money moves around. And people are getting rich off of that.

BILL MOYERS: What’s all this money doing to us?

KIM BARKER: I would argue that if you’re wondering why your government is so broke and you can’t really get anything passed through Congress, campaign finance has a lot to do with that.

I think it means that a candidate for office has to wake up in the morning and not just worry about what his or her opponent is doing. They have to worry about what his or her opponent’s outside money group is doing and what their own outside money group is doing. So you have this sense that as soon as you get into office, you have to start raising money for the next election. It means you can’t take a stand on an issue that might prove unpopular. It means that you have to go hand in hand with what your party thinks. It just sort of means that we’re going to get more of the same, more of this gridlock, which benefits a lot of these same billionaires that are putting money into the system in the first place.

ANDY KROLL: Political science has shown us that members of Congress are already far more receptive to the interests and the ideas and the whims of the very wealthy in this country, sort of the middle class, and basically could not care less about what poor and working people think or want in terms of policymaking. Add super PACs into the mix, add dark money groups into the mix, when really it’s just one donor in your district who can make or break you.

BILL MOYERS: Is that why you’ve been spending a lot of time at the local and state level, covering big money?

ANDY KROLL: Absolutely. I think it’s— I mean, I love covering at the local and state level, because it’s like taking a magnifying glass to these issues. What happens at the state level when you have empowered millionaires and billionaires? And how that influence is even stronger now and the money goes a lot farther at the state level than it does in Congress.

BILL MOYERS: You did that story on the DeVos family in Michigan. In a capsule, can you tell us what that was about?

ANDY KROLL: I’m from Michigan. The DeVos family, cofounders of Amway, the multilevel marketing company. Big time Republicans, long-time members of the Koch network, the donor network. So in 2012, Michigan does the unthinkable and passes a right-to-work law. The cradle of organized labor is now a right-to-work state.

BILL MOYERS: But they didn’t call it that. They called it “freedom to work” right?

ANDY KROLL: That was the spin, exactly. Dick DeVos, the heir to the Amway fortune had a role in this. I figured out that this had been a multi-year effort. There was fundraising. There was electing Republican candidates, essentially, helping to engineer a complete Republican takeover in Michigan in 2010.

The state House, the state Senate, and the Governor’s Mansion all were occupied by Republicans. And then a lot of, in this case, dark money, through a group, you know, another, the Michigan Freedom Fund, essentially, in a lame duck session in 2012, after the elections, put a blitz on. And blanketed the airways—

VOICEOVER in Michigan Freedom Fund Ad: There’s a plan to protect our freedom in Michigan. It’s called Freedom to Work, because joining a union or not should be your choice, and choosing not to join shouldn’t cost you your job. Freedom to Work will mean more jobs.

ANDY KROLL: —lobbied lawmakers really hard, you know, twisted arms if they needed to, broke a few as well, and just applied a massive amount of influence and did the unthinkable. And it still boggles my mind to think about it. But it was an incredible illustration of what one or two really motivated wealthy donors can do.

BILL MOYERS: “ProPublica” just published your latest big story on the Koch brothers. What’s new there?

KIM BARKER: We basically took a look at the network of 12 groups that we could identify from the Koch brothers network in 2012 that were active in trying to push conservative causes and spent more than $383 million that particular year.

And we tried to show what was going on with these LLCs that we figured out were involved with these 12 nonprofits.

BILL MOYERS: LLC? What is that?

KIM BARKER: Limited liability company. So we just wrote about how these had been playing behind the scenes in the Koch brothers’ network. But I think what you’re going to see much more this year is, you know, person X is going to go to Delaware. They’re going to have a lawyer form an LLC. And it doesn’t have to say who’s actually behind it. It just has to be LLC— let’s call it Sunny Day LLC. And then you’re going to have this LLC start spending money on politics. They’re going to tell the FEC—

BILL MOYERS: Federal Election Commission.

KIM BARKER: “Well, politics isn’t our main thing that we’re doing. We do all these other things. We make money. We do all these other things.” So they won’t have to report their donors. And they won’t have to deal with the I.R.S. saying, “You’re not a social welfare nonprofit.” The only thing that they’ll have to worry about is they’ll have to actually pay some taxes that they don’t have to pay right now with a social welfare nonprofit. But you know, you have this system that’s so complicated and really the only explanation that people could come up with is that it’s about control. It’s about having this set of LLCs, that you’ve got some unknown hands behind the scenes able to control what the groups are doing and make sure the groups stay in lockstep. That they never, you know, color outside the lines.

BILL MOYERS: So who is in control?

KIM BARKER: We don’t know. We know someone is. We know that it could be different folks for every single organization. But I can’t tell you for certain who’s in control.

ANDY KROLL: And there’s been a lot of great work. “ProPublica,” “Open Secrets,” “The Washington Post” about trying to visualize, you know, following the money. But it basically looks like someone put a big bowl of spaghetti in front of you and is like, “Follow the lines throughout the entire process.” And you’re like, “I can’t do that.”

BILL MOYERS: Why do they go to such lengths to keep secret where the money’s coming from, where it’s going, what’s it doing? Why not just say, “This is what we’re doing”?

ANDY KROLL:: Bad publicity.

KIM BARKER: Look what happened to Target, you know?

ANDY KROLL: Target is a great example. That was actually sort of the shot heard round corporate America. Target gave money to an organization in Minnesota that ended up advocating against marriage equality and then the—

KIM BARKER: Or a candidate.

ANDY KROLL: Right, against this issue. And you had the LGBT community, marriage equality advocates go ballistic, especially because Target had always portrayed itself as a sort of forward thinking, hip, progressive even organization. And yet, their money ended up supporting someone who was against gay marriage. And that scared a lot of people.

KIM BARKER: That was the canary in the coalmine. They don’t— nobody wants that to happen again.

BILL MOYERS: So are you suggesting— is it feasible that the Koch brothers or anybody is putting all this money into this labyrinth because they would be ashamed or hurt publicly if people knew what that money was doing?

ANDY KROLL: Absolutely. Absolutely. I think in a few rare cases, we have seen I.R.S. forms sort of accidentally released that include a list of donors. And it’s been sort of a who’s who of—

KIM BARKER: Fortune 500—

ANDY KROLL: Fortune 500 corporations. I mean, there was a tax filing from the early 2000s for the group Americans for Prosperity. Which is founded and funded by Charles and David Koch. And it had a whole roster of major corporations, name brand corporations. And they give to these organizations specifically so that they don’t have their name out in the public. And they can sort of quietly push, you know, this issue or that issue, but not have their brand out there. And they want to have their cake and eat it too.

BILL MOYERS: So that would explain why when the Supreme Court’s decision in Citizens United said transparency, disclosure will be the cleansing agent here, Mitch McConnell and others in Congress made sure the disclosure bill that would implement that transparency didn’t pass. The Disclose Act.

KIM BARKER: Yeah, yeah, and you really— so I think that the— either the Supreme Court was naive about how campaign finance really works. Or maybe just prescient. Maybe they knew what was going to happen. But their whole idea of using disclosure as some sort of cleansing mechanism and the internet as a way for people to figure out what was actually going, naive, you know?

You look at some of these groups, Americans for America, ad paid for by Americans for America, and you say, “I’m an American. I can get behind that idea. I can get behind America.” You know? And you really have no idea, though, where the money is coming from. And you have to do the level of research— I mean, I think Andy and I can spend months on a story. And you still get to the end of it. And I can say, “I know someone’s controlling this network from behind the scenes. But I can’t tell you who it is.”

BILL MOYERS: President Obama seemed horrified at the Citizens United decision, disgusted by it, repelled by it, and then he’s done nothing to counter them. The Democrats are embracing Citizens United, right?

KIM BARKER: Yeah, I mean, so far. It’s like, yeah, I mean, so far. I think in the very beginning, they said it was very distasteful. But they’ve joined, you know, they’ve said, “Okay,” after 2010, when they really didn’t take advantage of Citizens United and the conservatives very much did. They said, “Fine, we’re going to play this game now.”

So I think aside from a few people that are saying, “Look, money in politics is completely out of control. You’ve got Harry Reid, all these people that used to criticize Citizens United and have pretty much said, “If you can’t beat them at this, let’s just join them.”

ANDY KROLL: And I would say the Democrats, and especially President Obama and the folks in his universe got a taste of the forbidden fruit in 2012. And they really liked it. And I’m talking about a super PAC that specifically backed Obama. It’s called Priorities USA Action. You know, in a year when the story about super PACs was how little effect they seem to have, Priorities USA actually had a noticeable effect, you know, it picked a single message. Attacked Mitt Romney as essentially a coldhearted, soulless, you know, venture capital plutocrat. And it ran those ads, you know, using folks who had been laid off because Bain Capital, Mitt Romney’s former company had come in and taken over and then fired everybody.

WOMAN in Priorities USA Action Ad: I was suddenly 60 years old. I had no healthcare.

MAN 1 in Priorities USA Action Ad: Mainly what I was thinking about was my family. How am I going to take care of my family?

MAN 2 in Priorities USA Action Ad: He promised us the same things he’s promising the United States. And he’ll give you the same thing he gave us.

ANDY KROLL: And they use these ads really effectively, especially appealing to working class white people in Ohio, in North Carolina, and Florida. And, you know, I covered this, at the time, and you could really see Priorities USA making an impact for the president. And I think Democrats came out of that, in fact I know that they, you know, the week after the election, Jeffrey Katzenberg, the Hollywood movie mogul, who was really the sort of father of Priorities USA Action super PAC said, “Wow, that really worked. We should keep this thing around.”

BILL MOYERS: Isn’t that the one that’s now getting ready to sail with Hillary Clinton?

ANDY KROLL: It absolutely is.

BILL MOYERS: For 2016?

KIM BARKER: Yep, yep.

BILL MOYERS: Given the fact that their opponents have so much money, how should Obama and the Democrats play the game?

ANDY KROLL: Well, they could start by at least trying to implement some kind of reform. I mean, it’s not necessarily playing the same game as the other side, but it is, at least, acknowledging that this game is being played. I mean, I talk to Democrats who are in the business of winning elections, not in the business of passing reform, and they intend to use every tool at their disposal.

BILL MOYERS: And if you and I had that kind of money, wouldn’t we be tempted to do it? If it has that kind of impact and that kind of effect, wouldn’t we be tempted to do that?

KIM BARKER: Sure. Yes. Absolutely. You know? But people without money don’t have that same opportunity. And I think— I don’t know, a big issue that we try to cover is disclosure.

ANDY KROLL: This is the era of the empowered one percenter. And they absolutely are tempted. They’re taking action. And they are becoming the new, you know, headline players in this political system.

BILL MOYERS: Do you differentiate in any way between the Koch brothers, the Koch empire, and the billionaire like Tom Steyer who wants to educate the public on climate change and defeat climate deniers, and Bloomberg who wants to take on the gun culture?

ANDY KROLL: I think you have to. I mean, I think you have to in one sense, judge them on the merits of the issue that they are putting their money behind. On the other side, you seem to have a lot of conservatives who they’re very passionate about this issue or that. But those issues also happen to align with the bottom line of their companies. However, the spending— the raising and spending of that money on both sides has an effect on our democracy.

It’s a scary time to be writing about politics, to just be a participant in politics today, because you do see unelected individuals having as great a power as they’ve ever had at least since the post-Watergate reforms, maybe ever to—

KIM BARKER: Well, but we don’t really know that. I would disagree with you on that. I think that billionaires have always tried to influence politics. You can go back to the Copper King scandal of—

BILL MOYERS: Montana.

KIM BARKER: Yeah, the reason they had the tightest sort of rules on campaign contributions of any state. The reason that they were the state challenge to Citizens United in applying that to states. You know, you have always had this sense that I think people with a lot of money want politicians to do what they want them to do. And this is just the latest sort of form of that. I guess I wouldn’t say that you have to ask Americans if this is a system they want.

ANDY KROLL: I think you’re seeing a system, you’re seeing the center of gravity in the political system move away from the actual political parties and go toward the Tom Steyers and the Charles and David Kochs, the Mayor Bloombergs.

And these people have the means, they have the wealth, and now they have, you know, the means, the vehicles in this political system to essentially bankroll a candidate. They could— there could be the, you know, this donor club has their candidate. And this individual has his or her candidate. Maybe you could go back to the Gilded Age, the original Gilded Age and see a similar kind of situation. But—

BILL MOYERS: Or back to the Italian city-states. Every billionaire his own—

KIM BARKER: I mean, I think it is typical. People want influence. It’s a question of whether we’re going to allow it to happen, especially if we’re going to allow it to happen and nobody even knows who the influencers are. You know, this idea of the anonymous money and the anonymous hundreds of millions of dollars going into our political system.

BILL MOYERS: In your reporting have you found overall that Republicans and conservatives are spending more money this way than the Democrats and the liberals? Or does finally it all balance out?

KIM BARKER: You mean on the dark money side?

BILL MOYERS: Yes, on the dark money side.

KIM BARKER: In 2012, I think the ratio was 85 percent of the money spent was by conservative groups and 15 percent was by liberal groups.

BILL MOYERS: In dark— of dark—

KIM BARKER: Of dark money.

BILL MOYERS: Dark money?

KIM BARKER: Specifically dark money.

BILL MOYERS: Yeah, it’s a cat and mouse game. So how do you stay on top of it, when their lawyers are constantly closing one loophole and opening another?

ANDY KROLL: Well, you have to be just completely tireless and willing to bang your head against the wall every single day and know that for every 20 or 30 phone calls or emails that you send, maybe one will be returned?

KIM BARKER: Yeah, nobody returns your phone calls. You send emails out to [email protected], “We’d like your 990. What’s your street address?” Nothing. Because they’re all out of PO boxes. So you can’t even go by to ask them for their tax returns. Andy and I are talking about forming a support group actually, you know? Dealing with our rejection from people.

BILL MOYERS: If we keep talking about money in politics. If we keep showing people how much money is having so much impact, they just despair. They just tune out.

ANDY KROLL: I definitely hear fatigue, big number fatigue. How many times can you tell me that this super PAC spent $100 million or the Koch network spent $383 million on elections. I do get number fatigue. But I— you know, the outrage, at least from my own reporting, is not going away. In fact, people, I mean, I’m still meeting people who are just figuring out who Charles and David Koch are and still getting a sense of who the big players are in this climate right now, in this political system.

And the outrage isn’t going anywhere. And also I think it’s important to temper, you know, the bad news, if you will, with the good news when it comes along. I mean, for instance, the New York City political system has this matching public financing program, helped Mayor De Blasio. New York State is trying to implement a similar system.

KIM BARKER: You have a lot of states trying to take on dark money groups and trying to say, “You can’t just funnel anonymous money into the state elections.”

BILL MOYERS: This very week, the dictionary, Merriam-Webster formally, legitimately brought the noun “super PAC” into its dictionary, its online dictionaries, online unabridged dictionary. Have we made our peace with them culturally and politically?

KIM BARKER: I mean, the super PACs are here to stay. They just are. And I think that Citizens United pretty much set that up. There are super PACs. We have to know how we’re going to deal with them. And we also have to say, “Are we going to allow anonymous money coming into those super PACs? Are we going—” I think dark money is one area where you can get change and regulation. But if you’re going to have all this money going into politics and into elections, at the very least, you can have disclosure.

ANDY KROLL: One thing I would say from being on this beat and sort of studying the history of it, you often see a sort of swing between scandal and response. You see the system sort of grow, grow, grow, grow, grow and get stuffed with money for so long, until finally it pops.

Being in the middle of this every day, I at least have the feeling that if we’re not at one of those moments, man, are we sure getting there. One of those, you know, one of those tipping points, if you will. Just the amount of money coming in, how anonymous it is, showing no sign of slowing down, just rising and rising. You know, it’s— you can’t help but feel like, you know, this can’t go on forever.

KIM BARKER: And you talk to any sort of campaign finance watchdog who’s been doing it for a while and you say, “What’s going to stop this?” And the answer is always scandal. It’s going to have to be a big scandal. So you’re going to have to see a situation where all that money from one particular corporation or individual bought influence with a politician. And that translated into something bad.

BILL MOYERS: Seventy-five years ago here in New York City at Madison Square Garden, Franklin Roosevelt, President Roosevelt said, quote “We know now that Government by organized money is just as dangerous as Government by organized mob.” Have you seen this money corrupting our politics?

ANDY KROLL:: I think it absolutely is, in terms of the effect that it has on our elected officials and whose interests they’re responding to on a daily basis, and how they’re spending their time raising money and worrying about money being raised against them instead of thinking about solutions to the many problems in this country. And I don’t and I think that there is a legal debate about whether what I’ve just described is corruption, as the Supreme Courts would define it. But I think any average person on the street would say, “Yeah, my elected officials, my Congress is bought and sold. And they only care about what the people who fund their campaigns and their super PACs and their nonprofits think and not what I think.

KIM BARKER: Because it gets really strange when you compare the amount of money you can donate to a candidate and the limits on that. And you can compare the sort of money that you can donate to a super PAC or a dark money group. On one side, you’ve got very strict small limits. And on the other, it’s whatever you want to give, whatever you can afford.

BILL MOYERS: Kim Barker and ANDY KROLL:, thank you very much for being with me here today, and thank you very much for what you do.

KIM BARKER: Thanks very much for having us.

ANDY KROLL: Great to be here.

BILL MOYERS: At our website, BillMoyers.com, you’ll find continuing coverage of the corrupting influence of money in politics, and analysis of the Supreme Court’s next big decision on campaign spending, McCutcheon v. the FEC.

That’s all at BillMoyers.com. I’ll see you there and I’ll see you here, next time.

Producer: Gina Kim. Segment Producer: Lena Shemel. Editor: Sikay Tang.