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News State / Region Special Report: 2010 elections flooded WNC with outside money

What was the most offensive, false or frustrating political ad of the 2010 election campaign? Whichever candidates you supported, it is likely you can recall at least one TV commercial, mailer or print ad from the midterm election that rubbed you the wrong way.

Now, who paid for that ad? That is often a more difficult question to answer.

Since the 2010 Citizen’s United ruling by the Supreme Court which declared it unconstitutional to limit the amount of money that corporations and trade unions can spend to influence an election, the question of who paid for an ad has become more difficult to answer.

Former N.C. Senator Joe Sam Queen (DWaynesville) says Citizens United was “a big step backwards” in a fight against big money in politics that goes back decades. Queen was one of a number of North Carolina politicians who witnessed a deluge of attack ads on their candidacies from independent groups not directly affiliated with their opponents, groups supported by corporate bank accounts with almost limitless resources.

Of the millions spent by outside groups in North Carolina during the elections, $830,000 focused on three Western North Carolina senate districts (45, 47 and 50). In each of these contests, the Republican candidate emerged victorious. All told, outside groups spent almost $1.5 million in Western North Carolina in a historic election that shifted the balance of power in the General Assembly for the first time in more than a century.

In 2010, about $300 million was spent nationally by outside organizations to influence voter’s perspectives during the midterm elections. “That’s more than every midterm election combined since 1990,” says Jenn Frye, Associate Director of Democracy North Carolina, and that doesn’t count what was spent by the candidates’ own campaigns.

“Corporations need to stand by their ads. We need to know if Exxon-Mobile is telling us that the candidate will be good for the environment.” —Jenn Frye, Associate Director of Democracy NC

According to Frye, there is a reason why the last election was so flush with negative, misleading attack ads with mysterious backers: Citizens United. The 5-4 Supreme Court decision said that corporations and trade associations could spend unlimited amounts of money directly from their treasuries to run ads for or against particular candidates. While contributions directly to candidates are still regulated, the ruling said that these entities had the right to buy ads for or against any candidate without limit.

In North Carolina, groups with names like Real Jobs N.C., Americans for Prosperity and Civitas Action spent millions in the midterm elections as a result of the Citizens United decision, with these three alone spending almost $2 million in support of or in opposition to various candidates around the state. These groups are not bound by the same rules of financial disclosure as candidates, so it is often much more difficult for voters to know whose interests are being represented.

“This decision tips the balance against active citizenship and the rule of law by making it possible for the most powerful interests to manipulate not just individual politicians and electoral contests but political discourse itself,” said Frye during a presentation to the League of Women Voters in Franklin. Corporate interests are already powerfully represented by lobbyists, said Frye, but now that limits to political spending have been removed, few can hope to compete. “It skews our abilities as voters to understand who is impacting the political process and what interests they’re actually pushing.”

Queen agrees. “I think it is blatantly un- American,” he said of idea that corporations should have the same freedom of speech rights as individuals. “In spite of the Supreme Court decision, I don’t find that constitutionally valid.” Queen acknowledges that late in the last election, education groups and others began to run independent ads against his opponent, Ralph Hise but he says that groups supporting Republicans outspent those supporting Democrats almost 20 to one.

“The bad news is, it comes down to money,” said former Sen. John Snow (D-Murphy) about the impact of outside groups on the political process. Snow was defeated by Jim Davis (RFranklin) in another Western North Carolina Senate contest that saw hundreds of thousands of dollars in outside money which funded a number of particularly questionable attack ads.

Not everyone agrees that Citizen United was a bad call, however. Sen. Ralph Hise (R-Spruce Pine) says that first of all he was also the victim of quite a few attack ads from outside groups. “The truth is that candidates have no coordination with those individuals, no conversations,” he said. “We don’t know what’s going on, even when it comes from those who may support us or those who may oppose our opponents.” But Hise is not complaining. He says the Supreme Court has established that corporations have First Amendment rights just like individuals, and he doesn’t believe any legislation can change it.

Sen. Davis also supports the Citizens United ruling and believes that First Amendment rights should apply to corporations during elections, however he would limit it to American corporations. “I don’t think there ought to be any limitations on the amount or from whom, just so long as everything is reported,” said Davis, who notes that Democrats still raised more for their campaign committees in the state than Republicans (though Republican more then tripled their previous fundraising rates).

The problem, according to Frye, is that while all candidates and parties may find themselves the beneficiaries of outside groups at times, some groups are much louder than others (i.e. have more money). And behind those groups are often very powerful individuals.

The top three spenders in the North Carolina elections were all financially backed to a large extent by one individual: Art Pope. Pope, a former legislator and North Carolina businessman, is the primary financial backer for Civitas Action. He also contributed significant funding to Americans for Prosperity and Real Jobs N.C.

“If you take even just a narrow view of the immediate impact of the Citizens United ruling, what it did was flood elections with cash that was harder to trace, and it really did impact who won in North Carolina,” Frye said. “The number one threat to our democracy is the impact that money has on our political process.”

To battle this threat, organizations like Democracy North Carolina are operating on a number of fronts and taking advantage of popular discontentment with the political system. Some polls show that as many as 80 percent of registered voters of all political persuasions thought that the Citizens United decision was bad for democracy and that something should be done to reverse the impact.

On the legislative level, there are efforts to amend the Constitution to specifically say that corporations are not people and that they do not have the same rights as people. There has been some support for such an amendment, but even Frye admits it’s a stretch.

Another response to Citizens United has been a call for more disclosure from corporations and outside groups that run political campaigns. “If you’re going to open the flood gates to corporate money, we at least need to know where it’s coming from,” explained Frye. “Corporations need to stand by their ads. We need to know if Exxon-Mobile is telling us that the candidate will be good for the environment.”

Along with this pressure from outside, shareholders are also demanding more transparency, and an increasing number of companies are reviewing their own policies about the money they give politically and the amount of disclosure provided, says Frye.

Finally, fruitful work is also being done in the effort to promote public financing of elections. Democracy North Carolina was founded with the intent of reducing the influence of political money in the state by advocating for publicly-financed elections and other reforms. The organization was also part of the effort that led to the establishment of voter-run elections for state judicial candidates, a program that is supported by both Democrats and Republicans.

All of these efforts are aimed at returning democracy to the hands of its citizens, says Frye.“We can have a democracy in this country, or we can have great wealth concentrated in the hands of a few, but we can’t have both,” she said, quoting Supreme Court Justice Louis Brandeis.





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