Superpower or Banana Republic?

The numbers tell the story. The Congressional Leadership Fund alone has spent $6 million on TV ads to run this fall promoting the U.S. Republican cause. The fate of the electoral campaign in the United States hinges on large sums of money – and that money comes, in large part, from donors who do not necessarily have to identify which candidate they support. It’s a far cry from transparency, but the principle of anonymous donations is legal. Thus far, attempts to reform the system have been unsuccessful. Just this past Monday, a reform bill proposed by the Democrats failed due to Republican opposition. The veil that hangs over campaign finance will not easily be lifted.

The Congressional Leadership Fund is one of the so-called Super PACs, whose influence in political campaigns has spread widely in the past several years in the U.S. These are organizations that are allowed to collect unlimited amounts of money to fund political ad campaigns. The donations are not allowed to flow directly into the candidates’ campaign funds, but they can indirectly fund ads promoting a candidate nonetheless. The only problem: Super PACs must make public the names of their donors. That’s the law.

But that regulation is not hard to get around. The Super PACs have simply established subsidiaries that are nominally non-profit entities. The Congressional Leadership Fund, for example, operates the American Action Network for this purpose. Those who donate to such a group are allowed to remain anonymous. And just like that, the drapes are pulled shut.

Republicans and Democrats alike are using these non-profit organizations to great advantage. Even President Barack Obama, who at first opposed Super PACs and their allegedly non-profit subsidiaries, recognized early this year that these fundraising organizations could work to his advantage.

Democrats in the Senate in Washington now strongly favor increased transparency in the system — but not necessarily with pure motives. When it comes to fundraising, in the past few months Republicans have regularly been more successful than Democrats. It could be that Mitt Romney wins the November presidential election because he has more money in his propaganda fund. At a minimum, Obama’s campaign supporters have reason to fear that possibility. Obama himself showed us that in 2008, when he raised significantly more money than his Republican opponent John McCain. And so the Democrats would just love to know who’s behind Romney’s vast sums to incorporate those donor names into their campaign.

That’s why once again on Monday they proposed the so-called Disclose Act in the Senate. Under the act, the supposed non-profit groups would have to publish the names of any donor who gives more than $10,000. It wouldn’t be complete transparency, but it would be a start.

But the Republicans in the Senate rejected the draft legislation. They don’t want a transparent system. Republican Sen. Mitch McConnell of Kentucky made that point with remarkable openness. Transparency would just scare away potential donors, he claimed. In his view, it’s true. McConnell’s fellow party member Lindsey Graham of South Carolina even referred to it as “political theater at a time when we have real problems to solve.”

The tug-of-war over increased transparency does in fact seem a little like a tragic play. It sounded quite honestly a little desperate when, after the failed vote, Democratic Sen. Harry Reid said, “Perhaps Republicans want to shield a handful of billionaires willing to contribute nine figures to sway a close presidential election.” Reid added, “If this flood of outside money continues, the day after the election, 17 angry, old white men will wake up and realize they just bought the country.” What Reid did not say, however, was that the Democrats would likely have never brought this proposal to the Senate if, in this election, they too could rely on a handful of angry old men with thick wallets.

It was the president himself who, just this weekend, described the underlying problem very well. Washington seems just as broken as it did four years ago, said Obama. The promised improvement in the political culture is nowhere to be found. Democrats and Republicans are blocking each other equally — to the detriment of the country. That point was made by columnist Michael Gerson in a beautifully written sentence published in the Washington Post. America, he wrote, is becoming “a nation with the responsibilities of a superpower and the politics of a banana republic.”