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The boxes landed in the office of Montana investigators in March 2011.
Found in a meth house in Colorado, they were somewhat of a mystery, holding files on 23 conservative candidates in state races in Montana. They were filled with candidate surveys and mailers that said they were paid for by campaigns, and fliers and bank records from outside spending groups. One folder was labeled “Montana $ Bomb.”
The documents pointed to one outside group pulling the candidates’ strings: a social welfare nonprofit called Western Tradition Partnership, or WTP.
Altogether, the records added up to possible illegal “coordination” between the nonprofit and candidates for office in 2008 and 2010, said a Montana investigator and a former Federal Election Commission chairman who reviewed the material. Outside groups are allowed to spend money on political campaigns, but not to coordinate with candidates.
“My opinion, for what it’s worth, is that WTP was running a lot of these campaigns,” said investigator Julie Steab of the Montana Commissioner of Political Practices, who initially received the boxes from Colorado.
The boxes were examined by Frontline and ProPublica as part of an investigation into the growing influence on elections of dark money groups, tax-exempt organizations that can accept unlimited contributions and do not have to identify their donors. The documents offer a rare glimpse into the world of dark money, showing how Western Tradition Partnership appealed to donors, interacted with candidates and helped shape their election efforts.
Matt Brooks describes the mission of the Republican Jewish Coalition as educating the Jewish community about critical domestic and foreign policy issues.
But the well-dressed crowd that gathered in May for a luncheon on the 24th floor of a New York law firm easily could have figured that the group had a different purpose: Helping Mitt Romney win the presidency.
Brooks, the group's executive director, showed the 100 or so attendees two coalition-funded ads taking aim at President Barack Obama. Then Brooks made a pitch for a $6.5 million plan to help Romney in battleground states, reminding guests that their donations would not be publicly disclosed by the tax-exempt group.
"Contributions to the RJC are not reported," Brooks told the people sitting around a horseshoe-shaped table. "We don't make our donors' names available. We can take corporate money, personal money, cash, shekels, whatever you got."
The Republican Jewish Coalition and similar organizations enjoy tax-exempt status in exchange for promoting social welfare. In this election, the most expensive in U.S. history, they also have emerged as the primary conduit for anonymous big-money contributions.
Forget super PACs, their much-hyped cousins, which can take unlimited contributions but must name their donors. More money is being spent on TV advertising in the presidential race by social welfare nonprofits, known as 501(c)(4)s for their section of the tax code, than by any other type of independent group.
As of Aug. 8, they had spent more than $71 million on ads mentioning a candidate for president, according to estimates by Kantar Media's Campaign Media Analysis Group, or CMAG. Super PACs have spent an estimated $56 million.
Congress created the legal framework for 501(c)(4) nonprofits nearly a century ago. To receive the tax exemption, groups were supposed to be "operated exclusively for the promotion of social welfare." The IRS later opened the door to some forms of political activity by interpreting the statute to mean groups had to be "primarily" engaged in enhancing social welfare. But neither the tax code nor regulators set out how this would be measured.
In recent years, Democrats and Republicans alike have seized on that seemingly innocuous wording to create the darkest corner of American political fundraising.
That was before the boxes from Colorado turned up.
A convicted felon named Mark Siebel said he stumbled on them inside a known meth house near Denver at some point in late 2010.
It’s not clear how they got there. Siebel said a friend found them in a stolen car. After reading through some of the documents, he reached out to people he thought might be interested in them — primarily Colorado candidates attacked by Western Tradition Partnership. A lawyer married to one of the candidates shipped the boxes off to Montana investigators.
We live in this world, and we think that we are somehow a part of a system. well we are, but as the pawns. We can never be the knight or the king, we can only be pawns, to help the other pieces, the much more "important" pieces finally win the game.
Though this is coming out to the MSM a few days before the election (depending on this storm) it will be to late, but I hope that this will help others be more concerned and aware for who ever will decide to try to treat us as fools, to think again.
Webster's New World Dictionary defines the term "social welfare" as "any
service or activity designed to promote the welfare of the community and the
individual, as through counseling services, health clinics, recreation halls and
playgrounds ..." This definition is in alignment with the broad concept of "social
welfare" as provided in section 1.501(c)(4)-(a)(2)(i) of the Income Tax
Regulations. Additionally, the court in Commissioner v. Lake Forest, Inc., stated
that "In short, 'social welfare' is the well-being of persons as a community."
The terms "civic organization" and "social welfare" appear to be defined by
authorities in terms of "community", an equally evasive concept which will be
discussed at length later in this article in the context of Homeowners' Associations.
Because "social welfare" is a vague and elusive term, it has been broadly
interpreted by the courts and the Service.
Organizations exempt under section 501(c)(4) are generally described in one
of the following categories:
1. Nonprofit organizations that traditionally have been labeled
in common parlance as social welfare organizations;
2. Organizations that may be performing some type of public
or community benefit but whose principal feature is lack of
any private benefit or profit;
3. Organizations that would qualify for exemption under
section 501(c)(3) but for a defect in their organizational
instruments or if they were not "action organizations."
Officially, social welfare organizations are classified under Section 501(c)(4) of the tax code, which means they perform some kind of public or community benefit, Overby explains. They include groups like local volunteer fire departments, Rotary International and the League of Women Voters.
"There's this gray area where election law meets tax law," Overby explains. "While the campaigns are disclosing their donors, the superPACs are disclosing their donors, the (c)(4)s do not have to disclose their donors."
Republican strategist Karl Rove, a leader of Crossroads GPS, told Fox News recently why the group can call itself a "social welfare" organization: "It's a social welfare organization because it spends the vast preponderance of its money in furtherance of its social welfare goals. It's an issues advocacy group. For example, it's talking right now about the need to change our policies on spending and debt."
Crossroads GPS, which was formed in 2010, shortly after the Supreme Court's Citizens United ruling that loosened some campaign finance regulations, has raised $77 million in its first two years in existence. Overby reports that 90 percent of that came from — at most — 24 donors.
"This is what makes the social welfare organization approach so appealing," Overby explains. "You've got a couple dozen people who are able to play this incredibly powerful role in the election. It's anonymous. Nobody will ever know who they are. Not their business competitors. Not their political rivals. And not the voters."
On the very day in 2008 that the American Future Fund mailed its application to the IRS, checking the box for "no" on whether it planned to participate in politics, it uploaded an ad to YouTube praising a Republican senator. The group reported more than $8 million in political spending in 2010.
One group, the Center for Individual Freedom, told election officials that it spent $2.5 million on ads in 2010, when it paid for commercials criticizing Democrats in 10 districts. But it reported to the IRS that it spent nothing to directly or indirectly influence elections, calling those same ads "education" or "legislative activities."
For example, almost 70 percent of America's Families First's 2010 expenditures went to grants to five social welfare nonprofits. Four spent money on ads supporting Democrats or criticizing Republicans, including one group that put almost half of its expenditures into political ads.
The Republican Jewish Coalition, though formed in 1985, in many ways epitomizes the new breed of political-minded social welfare nonprofits.
The group's initial IRS application said it would not engage in politics, yet its 2010 tax return says it gave almost $3.8 million to other groups for political activities.
Separately, the Republican Jewish Coalition told the FEC it spent more than $1.1 million on political ads, money that wasn't reported to the IRS. Together, the grants and the political advertising made up almost 40 percent of the total expenditures of the group, which is chaired by GOP super donor and casino magnate Sheldon Adelson.
DO YOU SEE WHAT I MEAN???
Why would there be a confusion over what is going on? Do you think that they are mistaking what they mean? Do you think that this "political madness" has something to do with you? This is actually false. What we are watching, debating, discussing is one time every 4 years we are asked to decide, and partake in a boardroom meeting, that is usually (for the rest of the 4 years until we get involved again), held behind closed doors.