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NRA Shoots Loophole Through Campaign Finance Proposal

This deal is bad for democracy and bad for progressives--it provides added ammunition to perhaps the most potent conservative force in American politics.
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Yesterday, lead negotiators on the DISCLOSE Act announced a special carve-out that would allow the NRA--one of the nation's largest and wealthiest political actors--to avoid election spending disclosure even while accepting corporate money.

The carve-out is clearly intended only for the NRA - it appears that only a couple of other groups may meet the criteria. [Criteria are: 1 million members; members in all states; c4 status for 10 years; no more than 15% corporate funding; doesn't pay for campaign activity with corporate funds.]

This is bad for democracy and bad for progressives--it provides added ammunition to perhaps the most potent conservative force in American politics.

More important, it creates a huge potential loophole for funneling corporate money into politics without disclosure. NRA will become a magnet for up to $87 million of new corporate funds to funnel into the system through its coffers.

The Brady Campaign analyzed NRA's IRS 990 forms and announced yesterday that the group's 2007 501(c)(4) revenues were $332 million and 2008 revenues were $247 million. Total NRA 2008 election cycle revenue add up to $579 million.

This means that NRA can take $87 million (15% of its total revenues) in corporate money and still be exempt from this bill.

So far, there's been no public disclosure of how much of NRA's income comes from corporations.

Either NRA already takes tons of corporate money which they can funnel into politics by offsetting other expenses and technically using their individual donor money for Independent Expenditures. Or, even worse, they have much less corporate money in their revenue stream now. This means that a huge loophole for new corporate money coming into the system has been opened. And, even if NRA is close to its corporate limit now, they could use the prospect of attracting corporate funds as a "match" to attract more money from wealthy right-wing donors, who may not care about gun rights, but want to defeat Democrats (78% of NRA PAC contributions went to Republicans in 2008).

NRA did not conduct any independent expenditures through its 501(c)(4) in 2008, sticking to $7 million in PAC spending. But the group clearly plans to spend on elections through its c4 going forward--or else it would not have sought such a tailored exemption from the DISCLOSE Act.

Supporters of the carve-out will note--correctly--that NRA cannot take corporate funds specifically to spend on elections; this would void its exemption. But, everyone in politics is familiar with the wink and the nod. Corporations can give general revenue funds which will then free up NRA's copious individual donor money from their 4+ million members for spending on elections--money they would not have otherwise spent.