Don’t let the Show-Me State become a dark money model for the nation

“Social welfare” charities are increasingly being used to fund political ads while shielding their donors from voters.

May 3, 2018

Cross-posted from The Kansas City Star.

While questions about accounting practices at a charity may lack the lurid details of Gov. Eric Greitens’ personal scandals, it could be his G-rated missteps that finally bring him down.

Earlier this week, a report by a Missouri House committee exposed that the governor didn’t just illegally obtain a donor list from The Mission Continues — a “social welfare” charity he founded — to raise money for his political run. Greitens also allegedly staged a cover-up to mislead the Missouri Ethics Commission about how he got the list in the first place.

This isn’t the first time Greitens has come under fire for his relationships with nonprofits. Shortly after he rode to office on a wave of dark money, the governor’s campaign treasurer launched a nonprofit called A New Missouri that raised hundreds of thousands in anonymous funds in 2017 to promote Greitens’ agenda.

Officeholders nationwide are turning to these organizations, which are required under federal tax law to promote “social welfare,” but increasingly fund politics while shielding their donors through their nonprofit status. These nonprofits enable elected officials to raise unlimited funds from secret donors, including those with business before their offices. In short, they provide a conduit for corruption.

Occasional exposés across the country reveal just what a donation to one of these nonprofits can buy. In the state of New York, for example, gambling companies donated $2 million to a nonprofit affiliated with Democratic Gov. Andrew Cuomo just before he declared his support for more state-sanctioned gambling. In Los Angeles, a pipe manufacturing executive made it clear that his million-dollar pledge to the mayor’s nonprofit was meant to gain influence in a city that forbids campaign contributions by companies with government business.

Greitens has an opaque history with his deep-pocketed donors. His gubernatorial run was fueled by millions in spending by unknown funders, and he has refused to disclose who has donated how much to his cross-country travel or lavish inauguration.

The optics are not promising for those seeking to give Greitens the benefit of the doubt. A New Missouri is headquartered in a building owned by a major campaign donor to the governor — a building where Greitens’ campaign is also headquartered. To boot, the organization is run by a top adviser to Greitens’ campaign and key player in the alleged donor list cover-up, Austin Chambers.

All this presents an urgent problem for policymakers. The use of webs of nonprofits and other shadowy corporate structures to maximize secret funding is now part and parcel of our freewheeling politics. Some of that is a product of the 2010 Citizens United Supreme Court decision. But it’s also a product of our failure to tighten up our campaign finance and ethics laws, and then to enforce them effectively.

Fortunately there’s a practical (and constitutional) way for legislators in Missouri to reduce unaccountable political funding. In a new Brennan Center report, we lay out a straightforward road map for state and federal laws that would bring transparency to the connections between nonprofits and the officeholders they support.

For a nonprofit like A New Missouri — which is effectively controlled by an officeholder that it spends major funds to promote — we propose two key safeguards that are well-established components of anti-corruption law: One is public disclosure of who is giving money, and how much, to the organization. The second is contribution limits for donors who have concrete business interests that the officeholder has the power to affect.

These safeguards provide constituents the information they need to assess whether an elected official is acting in the interests of the public or in the interests of big donors.

Though Greitens’ legal troubles appear to far exceed the realm of nonprofit oversight, allegations about deeply-flawed elected officials remind us of the critical importance of transparency in a democracy. “Just trust me,” cannot be the governing rule of an officeholder-controlled nonprofit.

Sunshine, as the Supreme Court likes to say, is the best disinfectant.

(Photo: Flickr)