Senator Sheldon Whitehouse must think the American people have amnesia. At least that’s the impression I got while watching his Senate hearing on Wednesday, where he made the outrageous claim that the IRS never harassed or delayed the tax-exempt status of conservative groups back in 2013.
Of course, that’s not true. The U.S. Treasury Inspector General report found that “the IRS used inappropriate criteria to select tax-exempt applications for further review,” and the IRS admitted that approximately 75 percent of the nonprofits flagged were conservative-leaning.
Whitehouse’s blatant denial of this fact belies his distorted view that requiring nonprofits to disclose their donors will not lead to more targeting of conservatives or have a chilling effect on nonprofit donors who fear harassment or reprisal for their giving.
A more cynical take on Whitehouse and his allies' saber-rattling on this issue is that they know this sort of targeting will happen and, much like President Biden’s push for a Disinformation Governance Board, will mean a political advantage for Democrats.
On Wednesday, the Rhode Island senator’s lightly attended hearing centered on his favorite pet issue: so-called “dark money” in politics. As the Senator warned in a pre-hearing Tweet: “swarms of tax-exempt groups have been allowed to flood American politics with dark money, and our democracy is suffering for it.”
To fight these “swarms,” Whitehouse and his allies are backing legislation that would require nonprofit groups to disclose their donors, a policy that the Supreme Court recently ruled would violate the First Amendment freedom of association rights of donors.
Democrats also want to increase the IRS’s budget to conduct more audits of what Whitehouse called “spin cycle donations.” That’s where 501(c)4 nonprofit organizations spend 49.9% of a donor’s money on political activities, as they are allowed to by law, and then donate the rest of the money to another 501(c)4 to spend 49.9% of that donation and so on and so forth. The Senator and his witnesses provided little evidence that this “scheme” is widespread or an actual problem, but it sounds scary, and he has the flow charts to back it up.
Wednesday’s hearing was part of an ongoing charade for Whitehouse, and I’ve written about it before here. He regularly leads public circuses filled with flow charts and gaudy illustrations, deploring dark money but never admitting that tax-exempt groups aligned with Democrats funnel billions in donations to candidates on Whitehouse’s side of the aisle. The senator exclusively chastises Republicans or conservative organizations while acting naively oblivious to the recent New York Times report that dark money groups aligned with Democrats spent more than $1.5 billion throughout the 2020 presidential election.
Behind every major Democratic policy initiative - climate change, social justice, election reform - is a network of well-funded non-profit organizations and foundations staffed by losing campaign staffers and former advisors. They have names like Sixteen Thirty Fund, America Votes, League of Conservation Voters, Priorities USA, and the Voter Registration Project. Each is conducting precisely the type of First-Amendment protected advocacy that Whitehouse wants to stop.
The dark and shadowy, to use Whitehouse’s lingo, behemoth behind much of this funding is a group called Arabella Advisors - which doesn’t disclose its donors, wouldn’t you know. The Wall Street Journal describes the left’s web of dark money as “an empire managed by Arabella Advisors, a for-profit consulting firm founded by a Clinton administration alumnus who previously worked at the League of Conservation Voters—a “dark money heavyweight,” as the Center for Public Integrity puts it.”
Democrats have tried to use the IRS for decades to stifle conservative groups. The Institute for Free Speech’s Bradley Smith compiled a long list of Democrats, including Obama, Schumer, Durbin, Shaheen, and Merkely, who have all publicly pressured the IRS to investigate their political opponents, writing letters calling for investigations of specific conservative groups or pushing similar legislation to require donor disclosure.
Luckily, the Supreme Court recently ruled that such disclosure requirements are unconstitutional. As Chief Justice Roberts wrote in the majority opinion in Americans for Prosperity Foundation v. Bonta:
When it comes to the freedom of association, the protections of the First Amendment are triggered not only by actual restrictions on an individual’s ability to join with others to further shared goals. The risk of a chilling effect on association is enough, ‘[b]ecause First Amendment freedoms need breathing space to survive.’ Button, 371 U. S., at 433.
In that case, California’s donor requirements were struck down, and major left-leaning groups like the ACLU, NAACP Legal Defense Fund, and the Human Rights Campaign sided with Americans for Prosperity against California’s law. Neither Whitehouse nor his allies have addressed why they disagree with these stalwart left-leaning groups on this issue because they know it harms their cause.
Senator Whitehouse’s grandstanding might make good politics for Democrats, but his argument is outside the law. It's time to call out Sheldon Whitehouse for his grandstanding. Those aren’t swarms, Senator; those are citizens, and their speech and their right to associate are protected.