Does History Show a Remedy for Dark Money?
Despite pleas from President Biden, Senate Republicans blocked the Disclose Act, legislation that would require advocacy groups to provide names of donors who give $10,000 or more if they advocate for particular candidates or issues.
Biden stressed the need for such legislation by pointing to last month’s stunning revelation that Barre Seid, founder of the electronics company Tripp Lite, had sold his firm and donated $1.6 billion to nonprofit groups led by conservative operative and former vice president of the Federalist Society Leonard Leo. Biden called this move “one of the biggest dark money transfers in our history” — one that came to light only through the work of reporters.
Biden tried to paint the cause as bipartisan, recalling the late GOP Sen. John McCain’s efforts to increase transparency in political advertising through his work on the Bipartisan Campaign Reform Act of 2002.
Yet the better example of how to address the flood of dark money in politics may come from before the fight over modern campaign finance laws. In 1969, President Richard M. Nixon signed legislation that set rules to bring transparency and order to private giving in the name of safeguarding the public interest. The bill was more than a half-century in the making and showed that legislators in both parties could come together to ensure that the tax code encouraged charity without allowing for chicanery that starved the public of critical tax dollars.
As Congress debated enacting the income tax in 1910, oil tycoon John D. Rockefeller Sr. made an unprecedented offer. Rockefeller wanted a federal charter to permit the creation of a philanthropic corporation that he said would promote the welfare of the entire country. In return, he wanted the money given to this new foundation to be exempt from personal property taxes. In a period marked by staggering income inequality, Gilded Age business magnates like Rockefeller had served the nation’s patrons, but in the face of progressive taxation, they wanted special exemptions like this to continue their philanthropic endeavors.
Many in Congress feared that writing such an organization into law would open avenues for abuse and corporate misdeeds and could eventually become a platform from which Rockefeller could wield undue influence over public affairs.