A light in the dark: The quest to outlaw ‘dark money’

Former Attorney General remains steadfast to the Voter’s Right To Know

Posted 1/12/20

Should Arizona voters be able to know the original sources of money spent to influence Arizona elections?

Terry Goddard thinks so.

Mr. Goddard, a longtime political advocate, former mayor of …

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A light in the dark: The quest to outlaw ‘dark money’

Former Attorney General remains steadfast to the Voter’s Right To Know


Should Arizona voters be able to know the original sources of money spent to influence Arizona elections?

Terry Goddard thinks so.

Mr. Goddard, a longtime political advocate, former mayor of Phoenix and Arizona Attorney General, is spearheading an effort to end what is referred to by political aficionados as “dark money.”

Mr. Goddard, amongst a growing chorus of political operatives, believes a lack of disclosure for 501(c)4 nonprofit organizations that spend money on disseminating content using public communications is in direct conflict with American democracy.

One’s perception of the role dark money can play in a campaign often depends on where you stand on a political issue or candidate --- and whether or not that issue or candidate is the beneficiary of those funds.

In its 2010 ruling of Citizens United vs. the Federal Election Commission, the United States Supreme Court confirmed corporations are people and have the same rights as human beings to express its First Amendment right to political speech.

The idea of a corporation as a person reaches back to the turn of the 19th Century when the Southern Pacific Railroad successfully argued --- represented by Roscoe Conkling, who at the time was a prominent leader of the Republican Party --- the 14th Amendment was designed to protect corporations from discriminatory tax burdens.

Following the Civil War, the 14th Amendment appears to have been struck to ensure all people regardless of color were guaranteed “equal protection of the law.”

Mr. Conkling was a part of the drafting of the 14th Amendment. According to a 2019 article penned by UCLA Law Professor Adam Winkler for the Atlantic, Mr. Conkling successfully argued those equal protections were drafted with corporations in mind.

Mr. Goddard, says the Citizens United case did two things: It confirmed the idea corporations are people and have a right to free speech, and that the general public has a right to know where money comes from in political races.

According to federal law, 501(c)4 nonprofit donors can be anonymous as long as 51 percent of the funds spent go toward a social-service effort. The other 49 percent can be used in any political manner, which is oftentimes funneled into local political races.

“Dark money basically imperils our democracy --- it puts the credibility of our elections at-risk,” Mr. Goddard contends. “If you don’t know who is paying for a statement, you can’t evaluate it.”

The Citizens United case had everything to do with disclosure but also redefined dollars and cents as corporate free speech. Mr. Goddard says the 2010 Supreme Court ruling did not grant a constitutional right to hide political contributions.

A faceless enemy

In 2014, Republican Vernon Parker was running for a seat at the Arizona Corporation Commission and claims he attended a solar rally, was spotted and days later became the target of extensive political campaigns against him --- and fellow Republican Lucy Mason.

Mr. Parker estimates The Free Enterprise Club and Save Our State Now --- both 501(c)4 nonprofit organizations --- spent a reported $3.2 million on negative campaign ads through every medium, which he claims contained lies and slander against him.

The result? Mr. Parker says he was up 14 points in political polls before advertising campaigns emerged against him.

“I just thank God, I am back on my feet now and far removed from what had happened,” he said pointing out he believes Arizona Public Service was behind the attacks.

APS has never admitted to any wrongdoing regarding the 2014 election cycle.

“What they don’t realize is they use ratepayer money to destroy the lives of people who are just out there trying to do what is best for the ratepayer,” Mr. Parker said.

Mr. Parker, a lawyer by trade, a republican and former mayor of the Town of Paradise Valley, says he thought he was a good fit for the Arizona Corporation Commission.

“It was always something I was pretty passionate about,” he said recalling his time as an elected leader dealing with local utility providers.

“I met with APS and SRP, I mean, I met with everybody. I had multiple meetings with APS and made it very clear that I was seeking to be a voice of the ratepayers. The ratepayers, they are the ones who should be looked after a bit more. In my travels, I also met with a lot of groups, the alternative energies. I went to a pro-solar rally to collect signatures and it was reported I was there.”

From that point, Mr. Parker says, political attacks began.

“I was ahead in the polls about 14 points then at that point APS invested over $3 million to run negative ads against me. I would not rubber stamp for them if I was a commissioner,” he said.

“It affected me personally, it affected me financially and it affected my livelihood. All of that because I was determined to stay true to the ratepayer. It really took my knees from under me. It hurt my relationship with my family. I am an APS customer and still feel they used my own --- and other ratepayers’ money --- against me.”

--- Vernon Parker, Scottsdale resident

To a degree, Mr. Parker says, he hit rock bottom.

“All I wanted to do is go inside and hide,” he said.
“There was no way I could fight them. They had television commercials, mailers. And, at one point people would be pointing at me at the grocery store. I would not wish this on my own worst enemy. Emotionally and psychologically it was pretty devastating.”

Mr. Parker says the nondisclosure environment created by dark money entities ought to be a personal issue for all Arizona residents.

“I think our democracy will continue to be hijacked by special interests,” he said. “Special interest is not liberty --- dark money just takes the decision-making ability out of the hands of the individuals who are impacted the most. If we don’t do something now, we will definitely have the reverse of what democracy was supposed to be.”

A fight against secret money

Mr. Goddard is asking Arizona voters to stop the use of undisclosed funds in races through a statewide initiative --- one that requires 356,467 qualified signatures to get a placement on the November 2020 ballot.

The Voter’s Right to Know Amendment would require 501(c)4 nonprofit organizations to disclose the original source of so-called “dark money” used in political ads, Mr. Goddard contends.

Specifically, the amendment would require:

  • Anyone spending more than $20,000 on a statewide campaign or;
  • Anyone spending $10,000 on a local campaign to disclose the original source of contributions of $5,000 or more used to fund campaign expenditures; and
  • A nonpartisan, voter-established commission to write and enforce rules and levy fines for violators.

But first, more than 350,000 signatures of Arizona voters must be delivered to the Arizona Secretary of State office no later than July 2.

“We are cautiously optimistic,” Mr. Goddard said of the monster signature goal. “We have in-hand just short of 200,000 signatures. We are about halfway there.”

Mr. Goddard contends dark money is running rampant throughout all levels of Arizona politics.

“I can’t think of any pros, but I can think of a lot of cons,” he said in being asked if there is any benefit to political donors remaining anonymous. “I am sure donors consider it an advantage that they will not be disclosed --- that no one will know --- there are corporations and wealthy individuals who want to stay secret. Staying secret benefits them, but hurts us all.”

Mr. Goddard also points out a 501(c)4 nonprofit organization is under no obligation to register as a political committee and can provide unlimited funding under Arizona law.

“You won’t ever be able to tell who is really behind those political ads. They all have names like, ‘Americans for a Better Tomorrow.’ Who isn’t for that?” he explained. “They are only really interested in a better tomorrow for a few industries. Other names are uniquely innocuous.”

The ability to keep secret political contributors is a direct strike against American democracy, Mr. Goddard claims.

“I think secrecy is destructive to our democracy. I can’t see any benefit for the voting public,” he said.  “These groups operating in Arizona without having to disclose their donors. Arizona law is most permissive in the country in terms of avoiding disclosure.”

--- Terry Goddard

If signatures are gathered and if the constitutional amendment is approved by voters in November 2020, the Arizona Clean Elections Committee --- a bipartisan, voter-approved regulatory body --- would serve as the amendment’s enforcer, Mr. Goddard says.

“One thing that was very clear is Arizonans do not want to create a whole new bureaucracy,” he said explaining the role of Clean Elections if the amendment is approved by voters.

“The Arizona Clean Elections Commission was established by a vote of the people in 1998. It has worked very effectively as a nonpartisan regulator. It is the closest thing we have in Arizona to an election integrity commission.”

When asked why he continues his quest to outlaw dark money, Mr. Goddard quipped, “You mean when does the certificate of insanity get issued?”

Mr. Goddard says he believes dark money is a potentially fatal flaw in our democracy. He believes passionately Arizona voters deserve the right to know who is paying to influence their votes.

“We bent over backward to allow big donors to hide,” he said. “It bothers me to see voters kept in the dark.”


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