Over $2 million from corporate PACs, whose donations have become a campaign issue this year, has flowed to all the campaign accounts of candidates from both parties in the four hotly contested Orange County Congressional seats, according to federal campaign disclosures.
“Many in the public perceive that donors with economic interests give so that they may have access to officeholders later. And the perception is correct,” said Michael Malbin, a campaign finance expert who directs the Campaign Finance Institute in Washington, D.C.
“What you see going on nationally is Democrats taking up the issue of corporate political power and using PACs as a symbol of this issue.”
More than 90 percent of the $2 million-plus in corporate PAC money went to the Republican candidates – Diane Harkey, Mimi Walters, Young Kim, and Dana Rohrabacher – and constituted about 25 percent of the candidates’ fundraising into their campaigns, according to a Voice of OC review of disclosure data from the Federal Election Commission.
Their Democrat opponents – Mike Levin, Katie Porter, Gil Cisneros, and Harley Rouda – made a point of prominently declaring they don’t accept any corporate PAC money.
But federal data show each of the four Democrat candidates indirectly received corporate PAC money.
Altogether, according to the data, the Democratic candidates received more than $430,000 from dozens of campaign committees that are funded partly – and in some cases mostly – by corporate PACs, including the nation’s largest pharmaceutical companies, Wall Street banks, and military contractors.
[Click here to see a list of the contributions to the Democrat candidates and here for contributions to the Republicans.]
Federal data show corporate PAC money made it to the Democrat candidates’ campaign committees, on a smaller scale than their Republican opponents, through a series of at least 40 intermediary PACs that are partially funded by corporate PACs and corporations.
The Democrat candidates’ campaign money sources include committees funded by the corporate PACs of private prison contractor The GEO Group; pharmaceutical companies like Merck and Pfizer; Wall Street banks like Goldman Sachs and JPMorgan Chase; military contractors Lockheed Martin and Raytheon; and dozens of other major corporations.
Corporate PAC money accounts for less than 1.5 percent of the total money raised by the Democrat candidates in OC, when accounting for the share of corporate PAC money in the committees contributing to the candidates.
Voice of OC asked the campaigns of Levin, Rouda, Cisneros, and Porter why they accepted contributions from committees funded by corporate PACs, given the candidates’ promises, and whether they will return the money.
Some campaigns that responded suggested the pledge applied only to direct contributions from corporate PACs, though the candidate’s promises were broader claims to not take any corporate PAC money. Cisneros’ campaign said he returned all money directly from PACs, though they have not returned money from candidate committees that are partly funded by corporate PACs.
“Gil Cisneros has made a pledge to not accept any contributions from PACs, period. Each and every time the Cisneros for Congress campaign has received a direct contribution from a PAC, it has returned the funds to the PAC immediately,” said Cisneros’ campaign manager, Nic Jordan, in a statement. Cisneros is running for the open 39th District seat in north Orange County being vacated by Rep. Ed Royce (R-Fullerton).
Levin’s campaign emphasized the contributions he received were not directly from corporate PACs.
“None of the contributors to any of these PAC[s] had any role whatsoever in determining where the PAC contributed, and thus these are not corporate contributions,” said Parke Skelton, Levin’s campaign consultant, in an emailed response. Levin is seeking the south OC and coastal San Diego County 49th Congressional District seat of retiring Rep. Darrell Issa (R-Vista).
Skelton said Levin has fundraised from over 150,000 individuals, and the money identified by Voice of OC represents a small percentage of his overall money.
Porter’s campaign manager also emphasized she hasn’t taken any direct money from corporate PACs, unlike her opponent. Porter is running against incumbent Rep. Mimi Walters (R-Laguna Beach) in the inland, south Orange County 45th Congressional District.
“Mimi Walters has taken $1,480,000 and counting from corporate PACs. Unlike Mimi Walters, Katie is running her campaign without accepting a dime from corporate PAC’s, so you won’t find a corporate PAC donation on her report; not one cent,” said Porter’s campaign manager, Erica Kwiatkowski, in an emailed response.
“Katie has received grassroots support from over 180,000 contributions in the general election cycle so far, with an average contribution of $27.50,” Kwiatkowski said.
Porter’s campaign disclosures do not show any contributions from corporate PACs, though federal election filings do show about $116,000 in contributions to her committee from groups funded partly by corporate PACs, such as PAC to the Future. That particular PAC gave $5,000 to Porter’s committee and $10,000 each to Levin and Rouda’s.
Voice of OC sent the PAC to the Future campaign finance filings to Diana Dwyer, a Chico State professor who studies campaign finance. She said this is a route corporate PAC money takes to candidates’ committees.
“Corporate PAC money (not corporate money) makes it to candidates’ committees in this way,” Dwyer said. She emphasized corporate PAC money is different from corporate money because not is not directly from corporations, but rather is given by individual donors associated with the corporation, like executives and other employees.
None of the Democrats’ campaigns except Cisneros said whether they would return money they got from committees partially funded by corporate PACs.
Cisneros has largely self-funded his campaign with about $8 million from his 2010 lottery winnings. His campaign said he refused contributions from every PAC that has tried to contribute to his campaign.
But in Cisneros’ case, that doesn’t cover the main way money from corporate PAC-funded committees has come to his campaign, which is other candidates’ committees that have given his campaign at least $22,000. His campaign has not said whether he will return that money.
The OC races could help decide which party controls the 435-member House of Representatives and are attracting national attention ahead of the Nov. 6 election. Three of the OC races rank in the top five most expensive U.S. House races nationally this election, according to the transparency website OpenSecrets.
The Republican candidates in OC have not objected to corporate money, and donations include at least $45,000 from PACs run by pharmaceutical companies like Pfizer and Amgen directly to Walters’ campaign committee, and at least $11,000 from the PACs of oil industry companies like Chevron and Koch Industries directly to Kim’s committee.
In public statements, Democratic congressional candidates said corporate PAC money makes members of Congress answer to corporations rather than the people, and that they refused to accept such contributions.
“I’m refusing to take any money from corporate PACs – because I will only answer to you, not drug companies, the gun lobby, or Wall Street bankers,” wrote Harley Rouda on his campaign website. Rouda is running for the coastal 48th Congressional District against Rep. Dana Rohrabacher (R-Costa Mesa).
“I’m rejecting money from corporate PACs because Big Money in politics is a threat to our democracy,” wrote Levin in a July tweet.
Rouda’s campaign didn’t return phone and email messages seeking comment. His committee received at least $150,000 from committees that are partially funded by corporate PAC money, equivalent to about 2.4 percent of the overall money to his committee.
The corporate money so far hasn’t gone directly to the four Democratic candidates. Rather, the corporate PACs gave to committees with names like United for a Strong America PAC and Fearless for the People PAC, as well as candidate committees like Lofgren for Congress – which then contributed to Democrat candidates’ campaign committees here in OC and across the country.
For example, PACs run by the military contractor Raytheon and pharmaceutical companies Pfizer and Allergan contributed to the Committee to Re-Elect Linda Sanchez, which contributed $4,000 to Cisneros and $2,000 each to Levin, Porter, and Rouda, according to federal data.
The middle committees often mixed in money from individuals with corporate money, making them partially-funded, and in some cases mostly funded, by the corporate contributions. Money from these types of committees went to all four Democrats’ campaigns, according to the federal disclosures.
The money discussed in this article is separate from “independent expenditure” contributions supporting and opposing candidates, such as those by super PACs, which have spent millions on the OC races but cannot legally be controlled by candidates.
All four of the OC Democrat candidates appear to have received corporate PAC money through the national party’s main organization for electing Democrats to the U.S. House of Representatives: the Democratic Congressional Campaign Committee (DCCC).
The corporate PACs of Visa, Goldman Sachs and others gave to committees like Pete Aguilar for Congress, which then gave earmarked contributions through the DCCC to the four Democrats in the contested OC House races.
When congressional candidates have refused to accept corporate contributions, the corporate giving often switches to instead come from the companies’ CEOs and their spouses, which can make the money more difficult to connect to the corporations, according to campaign finance experts.
“It sounds good in a sound bite: ‘I don’t take corporate money.’ [But] yeah, you do,” just through CEOs and their spouses, said Robin Kolodny, a political science professor at Temple University who studies campaign finance.
Individual contributors with business interests will sometimes list their occupation as a housewife, “retired,” or “self-employed,” she added, which makes it more difficult to track which businesses they’re associated with.
“We are flush with corporate money from individuals who gained wealth through corporations or the stock market. So certainly, there’s a class of people and a very small group of people who are funding elections, and their organizations,” said Dwyer, the Chico State professor.
Many of the same corporate PACs are giving to committees that contribute to both Republican and Democrat candidates. Among them are Pfizer, AT&T, Verizon, Goldman Sachs, and Lockheed Martin.
“They just want to have access to the majority” that controls Congress, Kolodny said, adding companies are “betting on winners.”
Dwyer said people and organizations tend to contribute to people they already agree with.
“As hard as we try as political scientists to show that money buys votes, [you] will not find one study that actually demonstrates that. Because it’s not a straight line,” Dwyer said.
“It’s not like you’re changing their minds. They’re already on your team.”
Much of the corporate money to candidates’ campaigns is difficult to trace, because it passes through committees that each receive hundreds, if not thousands, of separate contributions from corporations, unions, and individuals, and then donate to dozens of other committees that give to candidates.
People in charge of campaign funding know this makes this more difficult for journalists to track it, said Kolodny.
In several cases, corporate PAC money traveled through three or more intermediary committees before reaching candidates in the OC races.
The PACs of Pfizer, Goldman Sachs, JPMorgan Chase, Herbalife and Visa each gave to CHC Bold PAC, which contributed to House Majority PAC, which contributed to Giffords PAC, which gave $3,000 each to Rouda, Porter, and Levin.
Each of the intermediary committees has received thousands of other separate contributions – many of which were from corporate PACs or committees funded corporate PACs – adding to the complexity of tracking the money.
The money pathway to the Democrats’ campaigns includes more than 70 different committees, at least 41 of which contributed directly to the OC candidates’ committees.
“If you want to hide your money, all you have to do is give to two layers of intermediary organizations,” said Malbin of the Campaign Finance Institute. Doing so provides “less and less valuable information for those of us who want to know what’s going on.”
“One of the fundamental principles of representative democracy is that we can hold officeholders accountable for their actions. We cannot do that unless we know whether officeholders are beholden to others,” Malbin added. “I have to be able to judge that and hold you accountable.”
Contact Nick Gerda at ngerda@voiceofoc.org and follow him on Twitter @nicholasgerda.