Defining ‘dark money' and discussing the state of money, politics and ethics in Missouri | St. Louis Public Radio

Defining ‘dark money' and discussing the state of money, politics and ethics in Missouri

Mar 16, 2017

Earlier this month, the spotlight was cast on the brand new nonprofit called A New Missouri Inc. Formed by Gov. Eric Greitens’ campaign treasurer, the group’s focus will be to advocate for the governor’s policy agenda. Its nonprofit status assigned by the IRS means that A New Missouri can take unlimited contributions and it does not have to release information about who gave those contributions.

While the non-profit’s status is perfectly legal, this raises questions about so-called “dark money,” political contributions and ethics in the state of Missouri. This non-profit is viewed by some as a potential loophole out of Amendment 2, which placed caps on campaign donation limits in Missouri.

It should be noted that politicians on both sides of the aisle, like New York Gov. Andrew Cuomo, utilize such loopholes in campaign finance.

On Thursday’s St. Louis on the Air, host Don Marsh spoke with several people from across the political spectrum about how money and politics are treated in today’s world.

Wally Siewert, the director of the center for ethics in public life at the University of Missouri-St. Louis, is organizing a conference on this subject for March 24 and joined the program. Alongside him were University of California-Irvine Professor Richard Hasen and the Show Me Institute’s Director of Government Accountability Patrick Ishmael.

Listen to the three discuss pressing issues about money in politics and what can actually be achieved through campaign finance reform:

The role of money in politics

Siewert said that money in politics is not inherently bad.

“Number one, I think we should admit that politics needs money: money is the fuel that brings democracy to citizens’ doorsteps,” Siewert said. “On the other hand, money can play the role of corrupter. Trying to figure out what that should look like is an ongoing discussion. There’s no simple answer on either side of the aisle, especially because the way money flows into politics and the way we talk about politics is changing so fast these days.”

He hopes that Democrats will realize that some money used for politics can be considered first amendment speech and that Republicans will realize that “political money doesn’t have a blanket from regulation.”

For Hasen, the problem is not the money itself but rather obfuscation of who is supplying the money.

“What we see is that the vast majority of the money that is coming in in many campaigns is coming from wealthy individuals, corporations and groups rather than the population as a whole,” Hasen said. “It makes the candidates who become elected officials and benefit from the money, they end up giving more access to the people who are the big donors.”

What is ‘dark money’?

"Dark money" is defined as when a 501(c)(4) organization uses money it has raised for political campaign-related activities.

“Usually we’re talking about this on the federal level but now we’re talking about it on the state and local level,” Hasen said. “Rather than form a political action committee that has to disclose donors publicly, people instead form 501(c)(4)s, social welfare organizations under the internal revenue code for any kind of educational, religious or charitable purpose. Generally, these organizations did not engage in political activity in recent years but then they started to. The IRS did not push back. Some of these groups are spending up to half of their money on campaign-related activities, disclosing what they spend but not who is contributing to their organizations for political purposes.”

Such practices are employed by politicians across the political spectrum.

“It is a bipartisan issue where Republicans and Democrats are both pursuing similar strategies because that’s where the rules in the system stand today, where you have a separate organization that can take in money because you can’t,” Ishmael said. “I don’t see that as one that is helpful to our political system or our discourse.”

Related Event

What: UMSL Center for Ethics in Public Life Presents "Ethics, Money and Politics" Conference
When: Friday, March 24 from 8 a.m. to 5 p.m.
Where: The Millennium Student Center Century Rooms on UMSL Campus
More information.

St. Louis on the Air brings you the stories of St. Louis and the people who live, work and create in our region. St. Louis on the Air host Don Marsh and producers Mary EdwardsAlex Heuer and Kelly Moffitt give you the information you need to make informed decisions and stay in touch with our diverse and vibrant St. Louis region.