A year ago this week, the Supreme Court freed corporate America to fully engage in campaigns, prompting dire predictions that Big Oil, Wal-Mart or even foreign firms would suddenly flood the political marketplace.
That didn’t happen. But at least one industry sector quietly and without controversy became a major player in the 2010 midterms – in a way that some campaign-finance experts believe could be the wave of the future for 2012 and beyond.
The model: the “Realtors’ Party,” the moniker the National Association of Realtors gave to its $6.5 million election effort, which backed a bipartisan slate of 103 pro-Realtor candidates and saw election of 66 of them.
In a few contests, including in Indiana and Colorado, the Realtors went toe-to-toe with the larger groups backed with much-criticized, anonymous business donations and formed with the guidance of former Bush adviser Karl Rove – and beat them.
Much of what the Realtors did in 2010 could have been done before the landmark Citizens United ruling – pooling contributions from individual Realtors and targeting pro-Realtor politicians for assistance.
But by 2012, some experts envision a day when industry groups will not only hit up their individual members, but their corporate accounts for campaign cash as well – and then target their spending in ways that have less to do with Democrat or Republican, and more to do with who is pro or con on their big issues.
The notion of a rise of well-funded, sector-based, business groups could add powerful new players into political system, conjuring up the specter of an “Ethanol Party” or a “Utilities Party,” which could pool resources and operate without any of the typical party loyalty tests, experts say.
“The business community is figuring out they need to be their own best advocate,” said Greg Casey, president of the Business Industry Political Action Committee, which helps companies set up voter registration and education programs aimed at their employees. “There is a lot going on. In some cases, the Realtors could be the model.”
Added Jan Baran, a Republican campaign finance expert who consults with corporations: “Realtors, auto dealers, lawyers, they are going to want to be politically effective, and a large measure of their influence is that they are present everywhere.”
Beyond the Realtors, the 2010 midterms featured modest independent expenditures from similar groups, such as the OB-GYN PAC, the AmericanAcademy of Ophthalmology, and host of other health-related groups hoping to secure seats for their professional colleagues or their relatives. Sen. Rand Paul (R-Ky.), himself an ophthalmologist, got a boost from his specialty’s PAC.
But the Realtors’ association took its operation to a much larger scale.
The association’s independent advertising campaign was ranked 13th among all the 2010 outside groups – making it smaller than the major GOP and labor union players but bigger than the two Democratic groups cobbled together late in the campaign season, according to a tally by the Center for Responsive Politics, a nonpartisan watchdog group.
It maximized its impact by taking on sizeable roles in just 11 races, including some of the hardest fought contests, and its candidates won in eight of them. Of the candidates selected to receive maximum support from the association, five were Republicans and six were Democrats.
The Realtors’ association declined to discuss their political program for this article. However, the group outlined it and its goals on its website.
“Electing and re-electing REALTOR friendly candidates is an integral part of protecting the industry,” it said. “During the 2010 mid-term election, REALTORS were the driving force in triggering the candidates’ understanding that stable and sustainable housing markets are the central component of our economic recovery.”
In Indiana, the American Action Network, Crossroads Grassroots Policy Strategies and American Crossroads – all groups driven by Rove’s strategic plan to defeat Democrats — spent a combined $722,000 attacking Rep. Joe Donnelly. The National Association of Realtors political action committee and its congressional fund spent more than $587,000 supporting him.
Donnelly won with a margin of 1.3 percent.
In Colorado, American Action Network and American Crossroads spent about $1.7 million trying to unseat Democratic Rep. Ed Perlmutter, which the Realtors countered with $727,000 in ads and direct mail leaflets supporting him.
After being declared the winner, Perlmutter celebrated by doing cartwheels through a crowd of supporters on his way to his Election Night victory podium.
“It helped blunt some of the astronomical amount of money coming from the other side,” said Danielle Radovich-Piper, the congressman’s chief of staff.
“I also think that it helped folks, the general public, understand that there was a business group out there supporting Ed and his efforts, which I think underscores the kind of person and legislator that he is,” she added.
In a post-election boast on its website, the association said: “Because of these ongoing efforts, the next Congress will contain many old friends and new friends who understand real estate issues.”
Those aren’t just feel good messages. The real estate industry had real stakes in the election. It is still in a precarious recovery and will be looking to Washington for continued help with foreclosures, lending and other issues. Most of the candidates it supported sit on the House Financial Services Committee, which oversees the housing industry.
The Realtors’ campaign differed from that of such large trade and business groups as the U.S. Chamber of Commerce in that it was built around one industry and targeted at a subset of candidates with clear records of advocating on housing issues while serving in Congress, a state legislature or on the job.
Casey and other campaign finance experts said one reason the Realtors could play amid the larger, more partisan groups and not get tainted is that the judgments driving their independent expenditure campaign mirrored those of a traditional PAC donation program.
In addition, the association emphasized on its website that “all communications feature positive messages about the candidate on real estate issues,” a policy that helped it avoid accusations of running ads deemed unfair or false.
According to Federal Election Commission records, the Realtors’ program was financed with individual donations from thousands of members, which also made it distinct from the newly created GOP groups that solicited big corporate checks.
“The methodology behind it is probably not different; it’s just a matter of degree,” said Ken Gross, a campaign finance expert who also consults corporations. “So it’s less likely to raise any questions about whether they are taking advantage of the new Supreme Court decision.”
Although the Realtors’ didn’t solicit corporation money, several campaign finance law experts said the Supreme Court decision last year in Citizens United v. the FEC would allow such financing.
But even if there is a rise of industry-based groups, Baran, Gross and other experts said America’s biggest brand names are likely to remain reticent about using corporate money to dabble in politics.
That reluctance only intensified after witnessing the public relations nightmare that consumed Target after the public disclosure of its donation of $150,000 to MNForward, a Minnesota political group created to influence state races.
Brian McClung, a spokesman for MNForward, said the group plans to remain operational and is gearing up for the 2012 state legislative races. But there were some lessons learned.
“We certainly had some bumps along the way, no question about that,” said McClung, who added that the group is considering reorganizing with new affiliates that would allow donations to remain secret much like the American Crossroads groups.
That is the route that Democrats believe coal companies took in West Virginia after news broke last summer that they were considering starting up their own political organization to run ads against Democrats.
No new group emerged, but the West Virginia Conservative Foundation, a seemingly dormant pro-coal group, suddenly came to life and launched a robust round of attack ads against Democratic candidates targeted by the coal industry barons.
“They used it as a shell,” accuses Derek Scarbro, head of the West Virginia Democratic Party. No one at the foundation could be reached for comment.
While anonymity can protect a business from attacks, it also has a downside – lawmakers may not know who to thank.
Perlmutter’s post-election calendar has already included several appearances and meetings with Realtor groups in Colorado and in Washington and there is more to come.
“He has enjoyed a good relationship with our local Realtor groups here for almost two decades,” said Radovich-Piper. “Which is why it wasn’t as surprising that they came in to help, but the level that they did was so.”