Democrats’ love-hate relationship with ‘dark money’ is ready to be put to a test

It’s a fundraising tactic politicians decry but have benefitted from to the tune of hundreds of millions of dollars over the past decade: so-called “dark money” from secret donors.

With just weeks until the midterms, Senate Democrats are preparing to vote on legislation that would offer voters a look under the hood of shadowy nonprofits and other political groups by no longer allowing anonymous contributions, instead forcing them to disclose the identities of their donors.

It’s a recurring proposition over the past decade by Democrats in Washington, who benefited more than Republicans from dark money groups in recent years. Still, they say the move will provide transparency into how political efforts are bankrolled.

Spending from groups that do not have to disclose donors topped $1 billion for the first time in 2020 and largely benefited Democrats, according to OpenSecrets, a nonprofit that tracks campaign finance and lobbying.

And yet, conservatives oppose changing the current rules that exempt nonprofit groups from disclosing donors. They say it would be an invasion of privacy and an attempt to shame the political beliefs of individuals and corporations, strengthening the left’s cancel culture.

“The goal here is to silence speech or make donors not want to support nonprofit groups,” said Mike Nese, vice president of People United for Privacy, the leading opposition to requiring donor disclosures. “They like to position this as a campaign finance bill, but it is very much the exact opposite. It’s an attack on issue advocacy and nonprofits of all vocations to pursue their missions.”

Senate Majority Leader Charles E. Schumer put the bill, known as the DISCLOSE Act, on the legislative calendar last week. It’s unclear when the New York Democrat will schedule a vote on it, but the measure will face certain defeat in the chamber that’s split 50-50 between the parties.

The intention to once again shine a spotlight on the issue of dark money, or contributions derived from undisclosed donors, is spearheaded by Sen. Sheldon Whitehouse, Rhode Island Democrat. It comes amid a boom in secretive money flowing into politics and accusations from the left that it is negatively reshaping American democracy.

Republicans, meanwhile, have labeled Democrats as hypocrites for exploiting it themselves.

GOP senators unleashed on Democrats earlier this year during the contentious confirmation of Supreme Court Justice Ketanji Brown Jackson, accusing the left of throwing large sums of undisclosed cash in support of her nomination.

“[Republicans] are spending an awful lot of time criticizing dark money,” Mr. Whitehouse said. “It’ll be interesting to watch them vote to protect it.”

In the years following the Supreme Court ruling in Citizens United v. FEC in 2010, which opened the floodgates for undisclosed donors, conservatives outpaced the left when it came to fundraising “dark money.”

Then came Donald Trump.

The former president ignited a fire under liberal groups, which argued they too should capitalize on secretive fundraising and spending to boost their political efforts in opposition to Mr. Trump. The left now eclipses the amount of undisclosed donor cash being brought in by Republicans.

Of the donations and spending officially disclosed to the Federal Election Commission, liberal groups injected north of $514 million into the 2020 election compared with conservatives’ $200 million, according to OpenSecrets. The top-spending “dark money” groups were One Nation, the Senate Republican leadership-aligned 501(c)(4) nonprofit that doled out more than $125 million, and Majority Forward, the Senate Democrats-aligned group that spent more than $86 million.

Despite ridiculing the left, conservatives are opposed to opening the finance books of nonprofits out of fear that donors’ contributions could be weaponized against them. As an example, Mr. Nese pointed to the case of how former U.N ambassador Nikki Haley’s political nonprofit, Stand for America, had its donor list leaked to Politico last month as she contemplates a potential presidential bid.

Sen. Josh Hawley, a Missouri Republican who opposes the bill, said shielding donors to nonprofit groups has been upheld in the courts for the better part of a century.

He cited a 1950s Supreme Court case, NAACP v. Alabama, which found that the group could keep its membership and donors list private. A similar case last year, Americans for Prosperity Foundation v. Bonta, received the same outcome. The high court ruled that a donor disclosure law in California was unconstitutional.

“For civic organizations, I think we want to be darn sure that we are not getting into a situation where people are terrorizing donors like, frankly, what was happening to the NAACP all those years ago,” he said.

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