The Cost of Democracy: How Dark Money is Funding Democratic Backsliding

Featured Image Source: Susan Walsh/AP via Washington Post

By Jared Miller

The most worrying parts of the 2020 election to me have not been the seemingly daily bombshells reported in the media, but the ones we will not know about for months, if not years to come. Cambridge Analytica-like firms and actors that utilize disinformation tactics that are anathema to a democracy.  Voter suppression as well as long-term gerrymandering strategies that have rigged the vote. Campaigns that privilege the interests of billionaires and corporations over communities. These are all efforts that contribute to the backsliding of American democracy and they all have a common thread—dark money. Dark money is untraceable election spending that our legal system is failing to prevent or hold accountable because we have legalized it.  Addressing the dark money that has funded these efforts is fundamental to stopping the backsliding of democracy in the United States. 

The Rise of Dark Money

In 2020, election spending on presidential, senate, and house races is estimated to have been almost $14 billion, almost double what was spent in 2016.  This is based on official filings with the Federal Election Commission (FEC), but this does not fully account for dark money.

Dark money is “spending meant to influence political outcomes where the source of the money is not disclosed,” and it has become an important source of political finance in elections for both Republicans and Democrats. In many cases, this political spending comes from nonprofits (e.g. Center for American Progress, Heritage Foundation), social welfare groups (e.g. National Rifle Association), and business organizations (e.g. U.S. Chamber of Commerce) who are not required to disclose their donors.  Dark money is the consequence of a series of 2010 Supreme Court rulings (Citizens United vs. FEC; SpeechNow v. FEC) that struck down limits on political spending as long as groups did not coordinate with candidates.  In practice, partly due to weak enforcement by the FEC, there is close cooperation between dark money groups and official campaigns, and independent groups can be used as a way to funnel money between nonprofits, Super Political Action Committees, shell companies, and campaigns in order to conceal the original source of the funds.  This creates a channel not only for extremely wealthy American to skirt election contribution limits donors (such as how the Koch Brothers funded the rise of the radical right), but foreign actors as well.

Given its opaque nature, and the fact that not all political spending must be disclosed to the FEC, it is extremely difficult to trace or ascertain how much dark money is being spent.  The Center for Responsive Politics estimates that at least $1 billion of dark money has been spent to influence elections since 2010.  Given that estimates of dark money are based on investigations of tax documents, it is unlikely we will know the amount of dark money in the 2020 elections for years to come. 

How Dark Money Funds Democratic Backsliding

Dark money is legal, but it has been used to fund some of the most undemocratic political efforts in contemporary American history. Here are four critical ways dark money is undermining American democracy:

https://twitter.com/realDonaldTrump/status/627841345789558788?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E627841345789558788%7Ctwgr%5Eshare_3&ref_url=https%3A%2F%2Fwww.cjr.org%2Fhit_or_miss%2Fmeet_the_megadonors_nyt_reveals_the_elites_funding_presidential_campaigns.php

1. Who do politicians work for? If money talks, then dark money hides who is talking. Campaign finance laws are designed limit the corrupting influence of money in elections, but dark money can hide who is bankrolling candidates and the parallel efforts to get them elected. Investigative journalists routinely uncover evidence of the influence of dark money, but rarely are these discovered in real time and many dark money trails go undiscovered. Americans overwhelmingly see the lack of transparency as a problem and strongly favor campaign finance reform.  In a 2019 Ipsos poll, 88 percent of respondents said they thought political ads should disclose who paid for the ad, 87 percent that political groups should disclose their donors, and 82 percent said they thought interest groups should follow the same campaign or election laws as political candidates.  Americans want reform, but the politicians who are benefiting from these campaigns have unsurprisingly been reluctant to act.  Increasingly, Democrats are in favor of campaign finance reform and eliminating the dark money loophole, but to date, Republicans have blocked any reform efforts.  

2. Gerrymandering. Voting should be about representing the will of the people, but dark money has been used to limit whose vote counts.  Both Republicans and Democrats are reported to have used dark money to fund strategies to gerrymander voting districts. For example, in 2010, not only did dark money groups help flip the North Carolina state legislature for Republicans, these same dark money groups were the ones redrawing the districts to favor Republican candidates going forward. This is systematic vote rigging and counter the meaning of democracy. The courts ruled that North Carolina’s state and congressional districts were unconstitutional, but the means these groups used to achieve this power, and most importantly the dark money funding them, were and continue to be legal.

3. Disinformation Campaigns. Elections should be about facts and civil debate, but dark money has funded disinformation campaigns designed to cause confusion and stoke tensions. One of the most infamous examples of this is how Cambridge Analytica targeted voters via Facebook during the 2016 U.S. presidential election. Cambridge Analytica, originally funded by billionaire Robert Mercer, first sought to understand how to influence American voters—using both fact and disinformation—to align with Mercer’s libertarian views. After Trump became the presidential candidate in 2016, Mercer unleashed Cambridge Analytica on behalf of the Trump campaign. The tactics of Cambridge Analytica themselves are undemocratic, but it was made possible because of dark money loopholes in campaign finance that allowed Mercer and other major donors to bankroll Cambridge Analytica on behalf of the Trump campaign. Cambridge Analytica officially dissolved in 2018, but it is extremely likely that similar firms have emerged, and it is known that key former Cambridge Analytica personnel are now working directly for the 2020 Trump campaign.  While Cambridge Analytica is the most egregious example of this, they are by far not the only actor propagating attack ads and disinformation. From January 2010 to December 2016, dark money groups are reported to have spent more than $800 million on political ads, the majority of which were negative ads attacking candidates. In an age of “alternative facts” and deliberate misinformation that at times bear a closer resemblance to propaganda than objective fact, who do voters believe, and who do they hold accountable?

4. Bankrolling an authoritarian agenda. The U.S. representative republic is based on the premise that the will of the majority governs, though there is evidence that this is not true in practice. Dark money has helped undermine majority rule. There is increasing evidence that the Republican party is undercutting democratic values and using authoritarian tactics in order to maintain power.  In a sense, the Republican party has abandoned democratic means in order to achieve its policy goals.  By funding campaigns to support these candidates, dark money has helped make these authoritarian tactics possible. 

Democratic Alarm Bells

Alarm bells are sounding about the future of democracy in the United States. Day after day we see reports of how American democracy is fracturing, but it is the behind the scenes actions that may have the most dire consequences.  One cross-cutting measure to stop them is to end the way they are funded and end the legalized corruption that is dark money. Ending dark money will not be a panacea for American democracy, but it will be a key part of beginning to mend our democracy. Regardless of which candidates are elected, it is time to close the dark money loophole.  The future of our country depends on it.   


About the Author

Jared is a Ph.D. student in International Relations at the Fletcher School at Tufts University focusing on electoral politics and corruption in Nigeria. While his current research focuses on Nigeria, Jared has also conducted research on election manipulation, corruption, and elite politics in the United States, Burundi, the Democratic Republic of the Congo, South Sudan, and Sudan.  In addition to his doctoral studies, Jared is a Research Assistant at the World Peace Foundation and a Fellow of the Leir Institute at Tufts University.  Prior to his doctoral work, Jared worked in Nigeria with Search for Common Ground, an international peacebuilding nonprofit, to support community-based peacebuilding programs.  In Nigeria, he worked on issues ranging from human rights accountability and governance reforms to violent extremism and community security.  Jared holds an MA in Law and Diplomacy from the Fletcher School at Tufts University and a BA in International Relations from the College of William & Mary.  You can contact him at jared.miller@tufts.edu.  


Related Blog Posts

One thought on “The Cost of Democracy: How Dark Money is Funding Democratic Backsliding

  • November 26, 2020 at 10:09 am
    Permalink

    I live in a different part of the world and we watched with great interest who the people of America chose. Since the votes are almost 50% divided by 50%, a split in society is possible. it is, of course, very sad to realize that in such a strong country there is a question of democracy. Is money the tool that can solve any problem?

    Reply

Leave a Reply

Your email address will not be published. Required fields are marked *