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ALEC, the Chamber of Commerce, and the Kochs: Inside the World of Secret Money

Since the overreaching Citizens United decision in 2010, our democracy has seen an explosion of undisclosed money enter our system, influencing elections and policymaking like never before. Without legislative or regulatory fixes, state and federal law allows considerable leeway for corporations and other special interests to spend in secret.

Presently, inadequate disclosure laws create loopholes for major corporations and other wealthy interests to participate in the secret money charade that plagues our democracy. Many corporations financially support trade associations like the U.S. Chamber of Commerce, which was one of the largest spenders of secret money in the 2016 election. The Chamber spent nearly $30 million. By funneling their finances through non-disclosing spenders like the U.S. Chamber, corporations are able to maintain a clean image on issues like climate or food safety, while simultaneously contributing to lobbying efforts and campaign spending that undermines public protections.

Beyond giving to trade associations, another option corporations have for funneling secret money is to give to nonprofits. Nonprofits that are classified as 501(c)(4) organizations are under no legal obligation to disclose their donors. Giving to these types of organizations is another crafty way corporations keep political spending secret in our current loophole-laden system.

Perhaps no name is as synonymous with political money as “Koch.” Charles and David Koch, two billionaire brothers with far-right libertarian views, wield a notoriously massive amount of power in our democracy. One of the many organizations bankrolled in part by the Kochs is Americans for Prosperity (AFP). AFP spent some of the most secret money of any non-profit in the 2016 elections, and the brothers have vowed to spend $400 million through AFP and other advocacy groups in the 2018 midterm elections to elect Republicans who support their agenda. That’s more than the total combined spending of the Republican National Committee, the National Rifle Association, and the U.S. Chamber of Commerce in the 2016 election cycle.

The money that groups like AFP spend carries exceptional clout because they also have close ties to the administration. More than 44 Trump administration officials have significant ties to the Koch brothers, and the Kochs have had considerable success in reshaping both state and federal law to suit their right-wing policy preferences. The Koch network, for instance, takes credit for a number of the GOP’s recent initiatives, such as the president’s withdrawal from the Paris Climate Agreement and the repeal of limits on short-term health insurance plans.

And much of their stranglehold on our democracy stems from their secret money efforts. The Kochs own or are affiliated with many of the same trade associations, lobbying groups, and political nonprofits that spend enormous sums of secret money in our elections. Much of the Koch Brothers’ political spending runs through a network of nonprofit groups that conceal the identities of donors. This means that they are able to reshape American policy from the shadows.

As rich as the Koch Brothers and their wealthy donors are, they wouldn’t have the influence on American policy they have if not for corporate backers supporting their agenda. For instance, Pfizer and ExxonMobil are among the top corporate sponsors of the American Legislative Exchange Council (ALEC), a conservative political nonprofit also funded heavily by the Koch Brothers that drafts and shares model state-level right-wing legislation for distribution among state governments across the country. ALEC introduces roughly 1,000 bills a year, with about 20 percent getting enacted—often completely unaltered and simply rubber-stamped by conservative state legislators.

Likewise, the U.S. Chamber of Commerce, with its many corporate donors, commissioned a sham “study” that has since been disproven that vastly overstated the costs and understated the benefits of implementing the Paris Climate Agreement. President Trump later cited this “study” as part of his rationale for pulling the United States out of the Agreement, a key component of the Koch Brothers’ agenda.

Americans have a right to know if corporations, individual billionaires, and other wealthy interests are shaping our public policy and our elections. We need stronger rules to force disclosure of secret political spending either from the Securities and Exchange Commission, the Federal Election Commission or the Federal Communications Commission (or all three!) Our democracy should be of, by, and for the people—not the Koch Brothers or other corporate influencers.