by John Alford
Alabama Legislatures are trying to clean up the state’s political landscape. The problem at hand is that money is being shifted around without a clear understanding of where the funds originated. Political action committees (“PACs“) are, essentially, groups that take in funds and redistribute contributions to candidates or to advocate particular issues. Prior to 2011, a PAC in Alabama could receive money from a donor and then transfer the funds to another PAC. The second PAC can then put funds into half a dozen other PACs, which use the money to help advocate issues. The identity of the individuals who originally donated the funds is lost in the mix. This means that people trying to influence, or even corrupt, politicians, can play this “shell game” and hide the money trail. Keep in mind, there are 859 PACs in Alabama.
An attempt to hide the money trail is exactly what happened when gambling interest groups began trying to increase their odds of success. The U.S. Justice Department wiretapped a session where this statement came to light: “We’re gonna support who supports democracy. And the (expletive deleted) who doesn’t support democracy [should] get ready to get their (expletive deleted) (expletive deleted) busted.” Certainly this crass statement could be taken admirably, but chances are the gambling tycoon was not strictly supporting democracy given that statement is taken in the context of extortion, bribery, fraud, and conspiracy charges. Shifting money from PAC-to-PAC to hide the connection to gambling money, however, was perfectly legal. This confusion of contributions was an integral means of getting support for the gambling agenda since politicians did not need to fear disclosure.
In response to the exact concerns raised by the gambling example, Alabama Legislatures passed House Bill 9, banning PAC-to-PAC transfers. Lawmakers have been seeking such a ban for years: “You can never have too much transparency.” Of course, it has been a hard sell over the years to get people to vote for a law that will ultimately limit the amount of financing a candidate’s campaign receives. Roy Moore, former chief justice of the state Supreme Court, tried running without using untraceable PAC money, and lost. Others supported some form of a PAC-to-PAC ban, but were unwilling to stop taking PAC contributions in fear of losing just like Moore. Now that the law is in place, all funding given to candidates from PACs can be traced back to the original donors. No longer can interest groups retain anonymity through a series of PAC transfers.
The PAC-to-PAC transfer ban is already causing troubles. Former Governor Bob Riley is under fire for illegally transferring $50,000 from one PAC to a new PAC, which he chairs; all this occurred after he signed the law into effect. Other instances have been reimbursement concerns and other small transfers between PACS. It appears that Riley will get out of trouble by claiming the transfer was a mistake which the groups corrected upon noticing. If this excuse works, then nothing should stop the rest of the groups from returning checks, saying they are sorry for erring, and wiping their hands clean of the matter. In addition, the Alabama Democratic Conference (ADC) is claiming that this PAC-to-PAC ban disproportionally affects minorities who benefit from larger PACs giving money to lesser candidates and voting initiative plans. Opponents to ADC’s position claim that such harms, if they do exist, are acceptable because the transparency gained from knowing a candidate’s money trail is invaluable to citizens and journalists.
So the question now becomes whether PAC-to-PAC contributions are worthwhile. Could the fear of pushing minority groups further into obscurity outweigh transparency concerns? There is some room for this argument, particularly given the history of minority treatment in the state. Yet there are other means of supporting minority candidates and voting initiatives than PAC-to-PAC transfers. If allowing PAC-to-PAC transfers means groups can manipulate legislative issues under a cloak of anonymity, then it is time for PACs to reconsider their business model and look for new and inventive solutions; perhaps it is time to take to the extremely effective and cheap forum: the Internet. At this point, going back to the old way just seems like too much of a gamble on democracy.
John Alford is a second-year student at William and Mary Law.
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