Big money, anonymity, slow disclosure: One Nation funds McConnell’s comeback

David Catanese
McClatchy Washington Bureau

Washington – When the Mitch McConnell-blessed One Nation group submitted its 2020 tax filing last month, it showed it received a $33 million contribution from a single person.

The amount made up nearly one-fifth of the $172 million the group banked during the election year.

Who is the well-heeled mystery donor pouring such a gargantuan sum into one organization’s political goals?

Because of One Nation’s status as a nonprofit public policy advocacy organization – a 501(c)4 in tax code parlance – it’s unlikely the public will ever know. Disclosing names isn’t required by law.

Senate Minority Leader Mitch McConnell, R-Ky., look out from a closing elevator on Capitol Hill in Washington, Tuesday, Dec. 7, 2021.

One Nation – helmed by former McConnell chief of staff Steven Law – has become a key player in the Republican march to reclaim the Senate majority next year. It’s already spent nearly $13 million in 2021 on issue ads targeting the most vulnerable Democratic incumbents on preserving the filibuster and opposing voting rights legislation.

And it is expected to deploy millions more in the coming months as the midterm campaigns intensify.

“Just as we have stood against radical legislative proposals being considered this year, One Nation will look for every opportunity to oppose liberals’ reckless legislative agenda that is making gas and groceries more expensive while slowing our economic recovery,” said Jack Pandol, One Nation’s spokesperson.

To preserve its nonprofit status, One Nation’s focus ostensibly has to be on shaping legislation. But realistically, its function and end goal is very close to that of its companion super PAC, the Senate Leadership Fund: Weaken Democrats fighting for reelection.

The same staffers who work for One Nation do close to the same work for SLF inside the same downtown Washington office building. One Nation simply offers its contributors something SLF cannot: anonymity.

“Basically, One Nation is a political entity masquerading as a nonprofit,” said Robert Maguire, the research director for the Citizens for Responsibility and Ethics in Washington. “One Nation only exists to help Republicans in the Senate, it’s not a social welfare organization.”

Maguire helped author an in-depth report on the group’s tax filing, which he obtained by showing up in person at their office.

“They have a policy of only providing physical documents. They don’t have to email it to you,” Maguire said, explaining the cumbersome process of tracking the money of nonprofits. “The whole system is antiquated. … The ambiguity and difficulty getting the information helps them.”

The reporting deadline of mid-November 2021 detailing 2020’s finances also demonstrates the substantial delay in the disclosure of millions of dollars received more than a year ago. Full details of their 2021 contributions won’t be available for scrutiny until after next year’s midterm elections, when most media attention will have moved on to the composition of the new Congress.

Even before their tax filing was made public, OpenSecrets estimated that One Nation was the biggest outside “dark money group” spender during the 2020 cycle.

But Democrats are taking advantage of the same system, with Majority Forward serving as their own nonprofit vehicle that pours tens of millions into advertisements that frame Senate Republicans in a harsh light.

Democrats have teed up legislation in the Disclose Act, which would require nonprofits to promptly disclose donors who have given $10,000 or more during an election cycle. But the fate of that bill looks onerous unless Democrats move to scrap the filibuster as part of a broader move to overhaul voting rights.

And some outside watchdogs believe that current law already prohibits many of the practices of groups like One Nation. The problem, these critics say, lies with a lack of enforcement by a resource-strapped Internal Revenue Service and a politically deadlocked Federal Election Commission that’s been frozen by partisanship.

Since the IRS was accused of targeting conservative nonprofits in 2013, it’s largely steered clear of challenging the status of existing nonprofits. On top of that, the IRS division that oversees such nonprofits has seen its staff steadily shrink, as ProPublica has reported, with conservative lawmakers eager to slash its budget even further.

McConnell has taken to making the IRS a political pinata, just last week accusing Democrats of wanting to put IRS agents in brand-new electric vehicles as part of their “Build Back Better” legislation.

“Don’t worry, Democrats will make sure IRS auditors can cruise around in Silicon Valley’s finest,” he said.

With the referees barely paying attention to the field, it’s only natural that the players have become more aggressive.

“The tactics used by dark money groups like One Nation have evolved and even matured over time as the outer bounds of what you can get away with are more clear,” said Brendan Fischer, director of federal reform at the Campaign Legal Center.

The best hope for reformers may sit in the courts, where there is a challenge to force the FEC to require greater disclosure. Additionally, the Securities and Exchange Commission has considered whether to require publicly traded companies to disclose their donations to their shareholders.

Still, without robust oversight and enforcement, it’s hard to see groups changing their tactics.

In October, One Nation announced its latest “advocacy effort” totaling $10 million of television, radio and digital ads in Arizona, Nevada and New Hampshire, where three of the most vulnerable Democratic senators are up for re-election next year.

The TV spots flash pictures of Speaker Nancy Pelosi and Majority Leader Chuck Schumer and warn of the “largest tax increases in decades, crushing small businesses and making families pay more.”

It’s the tagline at the close – providing the phone number of the senator’s office and imploring the viewer to call – that is meant to define the ad as advocacy.

How it differs from the rest of the pure political warfare that appears on screens is likely indiscernible to any person outside of politics.

And that’s pretty much the point.

“It increasingly looks like One Nation is ensuring that its spending is complementary to that of its super PAC. One Nation spends a lot of money in non-election years, effectively roughing up Democratic candidates and then the super PAC comes in and advocates more directly against those Democratic candidates,” Fischer said. “It’s sort of a one-two punch.”