Campaign finance laws may seem complicated to the average American.
But it really boils down to one simple divide: If you are engaging in political activity (related to elections), then your donors must be disclosed. If you are instead doing education and issue work, then you don’t have to disclose donors.
It is a clear line, and it is there for a reason.
Our laws aim to ensure that anyone attempting to influence an election cannot do so with secret donors. If a group is aiming to sway voter opinion, it is entirely reasonable for that group’s donors to be publicly known.
This fundamental principle has been brashly ignored by a so-called centrist group called Third Way in recent months. And amazingly, they don’t even deny it.
This organization claims to be a center-left think tank that “champions modern solutions to the most challenging problems in US public policy, including the economy, climate and energy, national security, social policy, and politics.”
Third Way is no different than a conservative group like the Heritage Foundation, which is the most respected conservative policy group on the right for decades. Heritage does not engage in election activity. Never. Not once. They don’t endorse, they don’t attack candidates, they remain focused solely on ideas and policies.
Just what exactly did Third Way do?
Just one month ago, Politico reported that officials from Third Way marched up to Capitol Hill to meet with Senate Democratic chiefs of staff to undermine the group No Labels, which is working to secure ballot access and announce a bipartisan presidential ticket next year if Joe Biden and Donald Trump are their parties’ nominees.
What was discussed in this meeting? We cannot be sure, but it was pitched as Third Way and Move On (a progressive group) wishing to “share some information that they have” on No Labels, which likely includes opposition research, suspicions about donor funding, and perhaps even recent polling.
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Third Way, like the Biden White House and national Democratic donors and activists, see tremendous political risk if a third party ticket were to run in 2024. And there may even be merit to that argument, depending on who the presidential nominee is, whether they can secure ballot access in enough states, and whether the effort is sufficiently funded.
But the merit of that argument is irrelevant to the central question: Is this election activity?
And the answer is clearly yes.
While Third Way will likely claim their concern is about policy differences with a second Trump administration, they have crossed the line of engaging in political activity.
And if they’ve done this by meeting with Senate offices, it can be reasonably assumed they’ve done more than this.
You can be sure that if Heritage was meeting with senior Republican aides and making the argument that Trump cannot win a general election or that another candidate must be nominated, there would be massive blowback and calls for probes into the group.
Third Way’s organizational structure is complicated, but a recent analysis by Ryan Ellis found that the organization’s recent filings show 63% of their funding comes from a sister organization that is a 510(c)3 organization. That sister organization allows tax-deductible gifts, on the explicit promise that it does not engage in political activity.
The IRS is incredibly clear about 501(c)3 groups and what they are permitted and not permitted to do.
Specifically, they are “absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office.”
By meeting with senior Democratic aides and publicly expressing their desire to undermine No Labels for the benefit of the Biden re-election campaign, Third Way is brazenly admitting they are violating tax laws.
The IRS should audit the organization and begin an investigation.
Rules must apply to all groups, whether they benefit one side or the other.
Should the same evidence be in place for a group like Heritage, you can be sure that voices on the left would be demanding an IRS audit. I would too.
Matt Mackowiak is the president of Potomac Strategy Group, a Republican consultant, a former Bush administration official, a Bush-Cheney re-election campaign veteran and a former press secretary to two U.S. Senators.
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