Twilight of the Super PAC

In his standard stump speech, Senator Bernie Sanders vows that millionaires and billionaires will no longer be able to buy elections if he wins the presidency. But what if the most venal corruptors of American democracy are not the buyers but the sellers—and their self-interested agents?

Late Sunday night, CNN reported a remarkable allegation. An anonymous Jeb Bush bundler estimated that Mike Murphy, the director of Bush’s Right to Rise, had billed the super PAC $14 million for his services—more than 10 percent of all the super PAC’s revenues. Murphy fiercely disputed the claim, and the next day CNN updated the original post with additional information.

As you read, ask yourself how you’d feel about this explanation if it were your donation at issue, especially the phrases I’ve bolded for emphasis:

Charlie Spies, the attorney and treasurer for the Bush-allied super PAC Right to Rise, said the Bush bundler's characterization was wildly inaccurate.

"That amount is wildly wrong, not even in the ballpark of what Mike's potential compensation could have been," said Spies. "We put vendor per vendor compensation caps in place to ensure that nobody made more than a certain amount of money. That amount is confidential, as is standard for most contracts; we have confidentiality provisions." Refuting the anonymous bundler's assertion, Spies added that "there is no way any so-called bundler would have any idea how much any vendor was making. The only people who would have any way of knowing that are the vendor themselves, myself as a treasurer and counselor, or our governance committee, which is a three person committee of senior donors and political leaders that was put in place to make sure that all compensation was reasonable and something donors would be comfortable with."

In other words: “How dare you accuse us of wasting money! Because of our total non-transparency, there’s no way any of our supporters can know whether we’ve used their money wisely or not!”

Super PACs are new phenomena in American politics. They are a product of two judicial decisions: the U.S. Supreme Court’s ruling in Citizens United v. Federal Election Commission, delivered in January 2010, and the D.C. Circuit’s decision in Speechnow.org v. Federal Election Commission, two months later. Together, these two decisions enabled the creation of a new entity: a political action committee that could accept unlimited donations so long as it did not coordinate its expenditure with any political campaign.

Advocates of campaign-spending limits were left aghast. In his 2010 State of the Union address, President Obama delivered a rare—perhaps unique—reprimand to the Supreme Court justices assembled in a row only a few yards away from him. “With all due deference to separation of powers, last week the Supreme Court reversed a century of law that I believe will open the floodgates for special interests—including foreign corporations—to spend without limit in our elections.”

And the spending came: hundreds and hundreds of millions of dollars of political spending, denominated in gifts in the millions and tens of millions and even hundreds of millions.

But what did it all buy?

In an interview on election night 2012, Chris Wallace challenged Karl Rove: “[American] Crossroads, which you helped found, spent—what?—$325 million, and we’ve ended up with the same president, the same Democratic majority in the Senate, and the same Republican majority in the House. Was it worth it?”

Many donors expressed similar frustrations, in public and—even more forcefully—in private.

American Crossroads would soon fade from the scene. In 2012, Crossroads backed eight U.S. Senate candidates. Six lost. The two who won had received comparatively minuscule amounts, leading some to scoff that Crossroads had achieved a return on investment of only 1 percent. Fundraising would decline to $100 million in 2014.*

Along with the noisy grumbling about Crossroads’ effectiveness, more unnerving doubts were quietly expressed within the conservative world. Had the money all been spent on the intended purposes? Had too much been spent on salaries, fees, expenses, and other forms of personal inurement? Politico’s Ken Vogel reported these whisperings in his June 2014 book, Big Money—and predicted Crossroads’ likely demise. In the current cycle, Crossroads has only spent $116,495 to date, according to the tally kept by OpenSecrets.org.

Disappointment did not, however, lead to disillusionment. After all, the super PAC connected to the Mitt Romney presidential campaign—Restore Our Future—had delivered powerful results. During the 2012 primary season, the ad barrage launched by Restore Our Future had crushed one Romney alternative after another. Restore Our Future saved the day during Romney’s moment of maximum danger: the 10 days between his 12-point defeat by Newt Gingrich in the January 22 South Carolina primary and his crushing 14.5-point victory in Florida on January 31. The Super PAC fired off $15.4 million on television and radio advertising in Florida, 92 percent of it negative. “Of all the spots that ran in Florida for the last week, 68 percent were attacks on Newt Gingrich,” The New York Times reported on primary day.

It was this experience that convinced so many people, pundits and professionals alike, that Donald Trump could not win in 2016. Yes, he might start with a big bump of media attention. But that the decisive moment, the super PACs would open their guns upon him—and down he’d go.

The 2016 super PACs certainly had the funds to do it! In addition to the nine-digit haul at Right to Rise, super PACs aligned with Ted Cruz, John Kasich, Marco Rubio, and Scott Walker all raised amounts somewhere between handsome and staggering. Yet in this Republican presidential contest, “never in the history of political campaigns has so much, bought so little, so fleetingly.”

Or more exactly…

Never has so much bought so little of what it was meant to buy. Obviously the funds expended on behalf of Jeb Bush have bought a great deal for a great many people. Even if the estimate of Mike Murphy’s take is overstated—or possibly confuses gross billings by his firm with net income to himself—the 2016 super PACs have provided princely incomes for their principals and comfortable livelihoods for hundreds more. The question that is bound to occur to super PAC donors is: “Are we being cheated?” Increasingly, super PACs look like the political world’s equivalent of hedge funds: institutions that charge vastly above-market fees to deliver sub-market returns.

Disgust with the costly ineffectiveness of super PACs may explain one of the most important mysteries of the current phase of the 2016 campaign. We keep hearing that Marco Rubio has replaced Jeb Bush as the new darling of establishment Republicans. Yet Rubio’s fundraising has lagged. Rubio’s super PAC, Conservative Solutions, raised $14.4 million in the second half of 2015—the period in which Jeb Bush’s candidacy cratered. In January 2016, by which time Bush was plainly doomed, and Rubio cast by almost all reporters as theoretical front-runner, Conservative Solutions raised only $2.46 million.

That’s not going to stop anybody, least of all Donald Trump, who not only leads nationwide, but (as of mid-January) is ahead by 26 points in Rubio’s must-win Florida.

A long time ago, I wrote a history of the 1970s. One of its sub-themes was the emergence of the post-Watergate campaign-finance system. I was surprised to learn that some of the strongest proponents of limits on campaign donations were the donors themselves. Many had felt extorted by the 1972 Richard Nixon re-election campaign. That campaign had targeted executives in federally regulated industries, notably aviation, with a strong message of “Nice little price-regulated airline you have here, it would be a shame if the president’s appointees disapproved your requests for fare increases to keep pace with inflation.” The president of American Airlines was asked for gift equivalent to one-quarter of his annual salary. The squeeze was so tight that executives at many companies succumbed to the temptation to seek artful contrivances to reimburse themselves from the company treasury—a serious violation of the law. (18 corporations were successfully prosecuted for illegal donations to the Nixon campaign.) In testimony to Congress, corporate executives insisted that they would gratefully welcome a legal excuse to say “No” to political demands.

And flashing forward in time, one has to wonder: How voluntary, really, were those gifts to Right to Rise? The campaign finance system is often described as organized bribery, but to many of those writing the checks, it must often feel like organized blackmail. How many would have appreciated some way to reply to the call from the Jeb Bush campaign: “Sure! Gladly! Love Jeb! Happy to give the legal maximum!”—in a world in which the legal maximum was $5,000 or $10,000 or $25,000. Like all human beings, multimillionaires have finite funds and infinite possibilities to expend those funds. Some must regard the local hospital or the homeless shelter or the city opera or their alma mater as more deserving causes than the ambitions of this politician or that. But the politician can retaliate, and the hospital, the homeless shelter, the opera, and the alma mater cannot. So it’s the politician who shoves his or her way to the head of the giving queue.

But having shoved his or her way forward, how much does the politician truly benefit from the super-PAC system? The politician’s natural interest is to spend as little as possible on consultants’ fees. That’s not in the consultants’ interest, obviously. The effect of the super PAC system is to put the consultants, not the politicians, in charge of the largest pools of political money—and then to wrap those consultants’ takings in layer upon layer of non-transparency and non-accountability.

In his final weeks as a candidate, Jeb Bush often pointed out that he was the one candidate most willing to tangle with Donald Trump. That was true of the words he spoke from his own mouth. But that’s not how his super PAC spent its money. “Trump has had few better allies than Right to Rise,” observed Stephen Hayes in the Weekly Standard. "Right to Rise, like an all-pro right guard, helped clear a path for Trump by blocking several of his would-be tacklers, in particular Marco Rubio.”

Is this really what Jeb Bush would have wished? Is this what he’d wish now—now that Trump seems to be driving inexorably toward the nomination? Or is this a case of a staff on autopilot spending other people’s money to advance its own agenda—while taking a slice of every dollar for themselves as they did so?

On the other hand, perhaps it is what Jeb Bush would wish. Perhaps Jeb Bush's resentment of Marco Rubio raged so intensely that he’d rather see his worst political enemy win the Republican nomination than his former political protégé. Perhaps Bush preferred to wreck his party to exact his revenge. In which case, all those lovely valedictories to Jeb Bush’s high character would seem radically misplaced.

We’ll never know the truth, because the super PAC system insulates politicians from responsibility for the ugliest things their supporters do. After it’s all over, Jeb Bush will claim that it was not he personally, but a zombie super PAC beyond his control, that preferred Trump to Rubio. Don’t blame me, Jeb Bush will say—blame Murphy. And the Republican world will do it. The Republican world already is doing it. And isn’t taking the blame part of why they pay you the big bucks?

* This article originally stated that six of the eight candidates backed by American Crossroads in the 2014 election were defeated. In fact, that was the group's record in 2012. We regret the error.