The future of campaign finance might have arrived this week—one whose center of political power is located not in traditional political parties but in independent groups.
The latest example of the new fundraising paradigm came on Friday, when the Karl Rove-aligned group Crossroads GPS announced a $20 million TV ad campaign targeting President Obama’s economic record. The news came one day after several well-connected supporters of Mitt Romney, the Republican Party’s early presidential front-runner, declared they had formed an outside group to aid the ex-Massachusetts governor’s campaign.
Combined, the developments show many of the slings and arrows cast during the 2012 election will come not from party committees but fledgling third-party organizations, which are unbound by many of the campaign-finance restrictions that gird candidates and political committees.
“Outside groups are major players, and they are shifting the financial balance,” said Michael Malbin, director of the Campaign Finance Institute. “No question about that.”
The shift in power is not new, but it might be accelerating now for both parties. For Republicans, the change began in earnest in 2010, when they were a big part of their sweeping set of congressional victories. Conservative-leaning outside groups like Crossroads spent $190 million, according to the Center for Responsive Politics, a sum nearly 10 times larger than what was spent during the 2006 midterms. The surge was thanks in large part to the Supreme Court’s landmark Citizens United decision that year, which allowed unlimited corporate and union contributions to political activities. The case was the most notable of a series of recent court decisions that have eviscerated many campaign-finance restrictions on outside groups.
Crossroads GPS, for instance, is a non-profit organization and does not have to disclose its donors—an enticement for contributors who want to keep their involvement a secret. Other groups, like Crossroads GPS’s sister organization American Crossroads, are so-called “SuperPACs,” and can receive uncapped donations that sometimes surpass $1 million.
While those groups have risen, Republican political parties, most notably the Republican National Committee, have fallen. Michael Steele’s tenure as RNC chief left the committee in financial tatters, loading it with enough debt that it could take much of the 2012 cycle to climb out of. Consider that Crossroads’ $20 million investment was nearly equal in size to the debt still held by the RNC at the end of May: $18.5 million.
Even as it retains the ability to coordinate with campaigns that is illegal for third-party groups, it could struggle to keep up with the blistering financial pace set by Crossroads and its brethren.
Third party groups are ready to make a big impact on the other side of the aisle now as well. Democrats, at the request of the president, stayed away from outside groups in 2010. But they are poised to use them even more fervently than Republicans in 2012, having already created a network of third-party groups that are focused on opposition research, House races, Senate campaigns, and the presidential battle. They have already made their presence felt: Priorities USA Action, a group cofounded by ex-Obama spokesman Bill Burton, has already begun airing ads in South Carolina attacking Romney.
Not coincidentally, Romney is the first GOP presidential hopeful whose supporters formed an outside group to support him. The organization, called Restore Our Future, was created mostly to respond to Priorities USA, a source close to the group said, but it could potentially play in the GOP primary.
Supporters of other candidates, particularly ones like Tim Pawlenty and Jon Huntsman who have access to big donors, are expected to create their own outside organizations, effectively creating an arms race among the GOP candidates. White House hopefuls whose supporters don’t have the deep pockets to form the third-party groups could be left in the cold, said Brian Jones, a GOP consultant.
“On the electoral chessboard, it’s a really important piece to have,” he said.