Operating with few rules and limited oversight, outside groups spent a record $1 billion to influence last year’s election.
Politicians of all persuasions griped about the meddling. But few are working to change laws that ushered in an unprecedented flood of money made possible by a 2010 Supreme Court ruling that erased years of campaign finance law.
Instead, political leaders and donors from both parties are preparing for the flow of outside money to intensify. New groups have formed and others are shaping plans to come back bigger and smarter ahead of the 2014 congressional elections and the 2016 presidential race.
What laws do remain could become even looser as the Supreme Court considers another high-profile decision.
“The unregulated system that we seem to be headed in will make Watergate look like a bad soap opera,” said Robert Zimmerman, a member of the Democratic National Committee’s national finance team who helped raise as much as $500,000 for President Barack Obama’s re-election effort.
“Everybody is focusing on raising more,” Zimmerman said.
The president, too, is intensifying his fundraising focus to help his party and a new nonprofit organization led by his former campaign manager.
Having promised to headline at least 20 fundraisers in his final presidential term for Democrat’s campaign committees, Obama last week raised millions of dollars in four events. One was a $32,400-per person brunch in Atherton, Calif.
“I’m going to need some help,” Obama told donors.
Donors who gave millions last fall, largely on the Republican side, are already lining up to do more.
Super PACs can raise and spend unlimited funds to help candidates, but cannot coordinate expenditures or strategy with a campaign.
The emergence of super PACs and other outside groups, emboldened partly by the Citizens United decision by the Supreme Court in 2010, has done more than anything else to reshape the contours of campaign fundraising.
A few federal court cases have broadly eased campaign finance rules, allowing donors to give unlimited sums. That kind of money largely has gone to super PACs.
Many super PACs have affiliated nonprofit “social welfare” organizations that spent hundreds of millions last year on issue ads. Those groups don’t have to disclose their donors because they’re governed by tax law. Open-government groups have pushed Congress, to no avail, for a law that would require politically active groups to disclose their finances.
The system faces further deregulation as the Supreme Court prepares to hear a case this year that could wipe away aggregate annual limits on direct contributions to candidates and official campaign committees.
Officials across the political spectrum already acknowledge that there is little oversight in the new world of political fundraising, where the Internal Revenue Service and Federal Election Commission have been reluctant to enforce what rules remain.
Meanwhile, the number of outside groups leveraging the tax code to court major donors is growing.
Obama earlier in the year converted his victorious re-election campaign into an unprecedented nonprofit organization, Organizing for Action, designed to influence policy debates in Washington. Individual donations to the Obama campaign were capped at $2,500 last year; the new group has no such limits.
Its leaders have reached out to at least 50 top Obama donors who intend to raise at least $500,000 this year. Former Obama campaign manager and group chairman, Jim Messina, said that Organizing for Action voluntarily would disclose the identity and specific amount of money it receives from donors, while denying corporate donations.
Republicans were quick to react to the 2010 Supreme Court ruling, creating well-funded outside groups that spent heavily on television ads that aided the GOP’s success in the 2010 congressional elections. Obama initially signaled that he didn’t want Democrats to form outside groups, but ultimately gave his blessing after the Republican gains in that election.
“It’s a disaster of a system. But Democrats need to be engaged or else Republicans are going to perpetually win,” said Bill Burton, a former Obama adviser who led the president’s super PAC.
Indeed, outside groups overwhelmingly favored Republicans in the last election. The super PAC allied with Obama, for example, spent more than $65 million compared with $142 million spent by that of Republican presidential nominee Mitt Romney.
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