Opinion: Dark money reaches into Michigan GOP primaries

Patrick L. Anderson

Last week, senior U.S. intelligence officials solemnly warned about Russian interference in the midterm elections. Facebook banned groups masquerading as progressive activists that were actually controlled by international organizations. A Russian woman that managed to ask Donald Trump a question at a conservative event was charged with espionage.

In Michigan, damage is being done by domestically-sponsored “dark money” organizations, Anderson writes.

Meanwhile, here in Michigan, far more damage is being done by domestically-sponsored “dark money” organizations that claim they can legally spend millions of dollars urging voters to support specific candidates, while hiding their identities. The worst of these front groups are now actively promoting specific candidates in GOP primaries for state House and Senate seats, refusing to even name the people running their organizations.

And they are claiming they are tax-exempt while they do it.

Take “Citizens for Energizing Michigan’s Economy.” It received at least $20 million from one Michigan utility, Consumers Energy, according to a Michigan Public Service  Commission filing. In 2017, it listed the former campaign manager for Gov. Jennifer Granholm as its president. An attorney designated as its agent claims it does not have to reveal the current officers of the organization. A Consumers Energy spokesperson says it doesn’t control the entity, which is now running ads in the areas around Lansing, Battle Creek and Grand Rapids.

But someone controls it.

This “social welfare” organization has spent well over $2 million is just a handful of GOP primaries — without filing a single campaign disclosure statement with the state of Michigan. In just one race — against Rep. Gary Glenn, who is running for state Senate — they have spent over $1 million. At least $300,000 has been spent against Rep. Tom Barrett. In just the last two weeks of the campaign, CEME spent at least $150,000 supporting a single candidate in an open GOP primary in Clinton and Gratiot counties.

I learned this first hand, as my wife Madhu Anderson is a candidate for state House in the 93rd district. CEME called our house three times, and sent us numerous mailings asking us to support a fictitious “plan” of their favored candidate, Graham Filler. To top it off, they bought TV ads. Again, this is for a primary election for a single seat in the House of Representatives.

To put this in perspective, campaign finance disclosures show that cumulative, legal campaign contributions to the three candidates in this GOP primary were between $35,000 and $55,000. Thus, one shadowy group spent more money than all the candidates combined, and did it in just a two-week period. And, CEME is not the only front group; multiple organizations operate out of the same address in Okemos, and others (such as “Faithful Conservatives for Michigan” and “Alliance for Michigan Power”) appear to operate in tandem.

Under Michigan law, even a $20 contribution has to be disclosed, along with the name and occupation of the contributor. U.S. law explicitly prohibits tax-exempt “social welfare” entities from running campaign operations. You and I cannot deduct a $100 candidate contribution on our income tax return. Yet, somehow, the dominant spender in Michigan politics right now claims tax exempt status, calls itself a “social welfare” organization, won’t say who runs it, and has been disavowed by an entity that gave it at least $20 million.

Citizens who agree with me can do two things. First, don’t be fooled by phony claims by sham organizations. Before you vote, check to see what the actual candidate said or did. Certainly, if you are in one of the districts targeted by CEME and its shadowy partners, choose your vote carefully.

Second, you can join me in asking the IRS to investigate these blatant violations of tax laws. The Michigan Campaign Finance Network is one organization that has kept tabs on these groups, and it has a copy of the IRS complaint I filed against CEME. If you get a similar campaign advertisement by a “social welfare” group, you can file your own complaint, using Form 13909.

What is happening now is an outrage, but it is an outrage citizens can stop.

Patrick L. Anderson is the principal and CEO of Anderson Economic Group. He lives in Bath Township.