Stuff You Should Know - How Dark Money Works

Episode Date: March 10, 2016

Since the Supreme Court ruled in 2010 in the Citizens United case that political contributions are speech and should be protected, the floodgates of anonymous political contributions have opened. But does absolute funding corrupt absolutely? Learn more about your ad-choices at https://www.iheartpodcastnetwork.comSee omnystudio.com/listener for privacy information.

On the podcast, Hey Dude, the 90s called, David Lasher and Christine Taylor, stars of the cult classic show, Hey Dude, bring you back to the days of slip dresses and choker necklaces. We're gonna use Hey Dude as our jumping off point, but we are going to unpack and dive back into the decade of the 90s.

We lived it, and now we're calling on all of our friends to come back and relive it. Listen to Hey Dude, the 90s called on the iHeart radio app, Apple Podcasts, or wherever you get your podcasts. Hey, I'm Lance Bass, host of the new iHeart podcast, Frosted Tips with Lance Bass. Do you ever think to yourself, what advice would Lance Bass

and my favorite boy bands give me in this situation? If you do, you've come to the right place because I'm here to help. And a different hot, sexy teen crush boy bander each week to guide you through life. Tell everybody, ya everybody, about my new podcast and make sure to listen so we'll never, ever have to say. Bye, bye, bye.

Listen to Frosted Tips with Lance Bass on the iHeart radio app, Apple Podcasts, or wherever you listen to podcasts. Welcome to Stuff You Should Know from HowStuffWorks.com. Bush and Dukakis on crime. Bush supports the death penalty for first degree murderers. Dukakis not only opposes the death penalty,

he allowed first degree murderers to have weekend passes from prison. One was Willie Horton, who murdered a boy in a robbery, stabbing him 19 times. Despite a life sentence, Horton received 10 weekend passes from prison. Horton fled, kidnapped a young couple, stabbing the man and repeatedly raping his girlfriend.

Weekend prison passes. Dukakis on crime. Hey, and welcome to the podcast. I'm Josh Clark. There's Charles W. Chuck Bryant. There's Jerry over there. And what you've just heard was something we brought back with us from 1988

via the Way Back Machine. That's right. An attack ad, the attack ad from the 1988 election between George Herbert Walker Bush and one Michael Dukakis. That's right. And that ad is widely credited as turning the tide against Dukakis' campaign,

which was doing pretty good at the time. Yeah, well, some people say so. Other people say, nah. True. Depends on who you ask. That's dissent. That's politics, as it turns out. There's always more than one opinion.

But the reason we bring up this ad, which first aired on September 21st, 1988, like this, is called Weekend Passes for obvious reasons. And it was funded by something called the National Security Political Action Committee. And NSPAC was a non-affiliated, pro-Bush, pro-Bush political action committee that was aimed at sinking Dukakis

and getting Bush elected. Yeah. I think one of Bush's, maybe it was his chief campaign guy, said, by the time we're done, people are gonna think Willie Horton is Dukakis' running mate. Oh, man. And it worked too.

I mean, like still, if you say the name Willie Horton, people of a certain age, e.g. our age, can still say, oh, I know who that is. Yeah. Well, quickly, the story of Willie Horton is, he was in prison for murder, was furloughed as part of the, for a weekend, as part of the Massachusetts furlough program

that was in effect at the time. And he raped and killed somebody. On this Weekend Pass. On the Weekend Pass, which was a big sign that it may not be a good idea to furlough murders. Yeah. I guess they needed to test it out to find out one way or another,

but yeah, that pretty much closed the book on it. And the thing was, the Bush campaign linked Dukakis', well, Dukakis himself, with the Weekend Passes and insinuated that he had come up with this and that he was in support of it. Well, he wasn't in support of it. He didn't come up with it, though. Yeah, he inherited it from his Republican predecessor,

I believe. Yeah, it actually started in 1972 with the Republican governor of Massachusetts, which apparently things have been going fine up until then, up until Willie Horton came along. Yeah, it kind of had a weird along and winding road. The initial program excluded first degree murderers. And then the Supreme Court said,

no, the law doesn't specifically say that. So you can't exclude first degree murderers. So the legislature said, well, we gotta put a stop to this and we can't let first degree murderers out on leave. Right. And Dukakis vetoed that. So he did support it until he decided to run for president. And that's when he said, let's get this off the books.

Yeah, so the NS PAC ad was very widely criticized. It was criticized as being misleading. It was criticized as fostering racist attitudes. But it still worked. A lot of people say, and I understand some people say, no, a lot of people say this did work. Some people say it was the tank ride. Remember that?

Oh, I forgot about that. Dukakis rode around in that tank. Yeah, I totally forgot about that. He was off the rails there for a little bit. But the thing is George Bush's campaign was able to say, hey, this had nothing to do with us, blame NS PAC. Right. So it still worked in George Bush's favor,

but George Bush got to say this had nothing to do with me. Not like do it. Remodel it. That was Clinton I just did. Yeah, it was. It was pretty dead on Clinton, really. It's called a political mashup. And the whole way that this PAC was funded

was with what's called dark money. Yeah, we should just title this one, how to exploit a loophole in America. Yeah, and how the Supreme Court really screwed things up. Yeah, or if you don't like Josh and Chuck talking politics, turn it off now. Yeah. So we're taking down the system.

Yeah, yeah, here's the thing, man. Billionaires controlling who gets elected in the United States is not a conservative or a liberal issue. We're all being screwed over equally here, everyone. I got a stat for you, and then we'll get right into it. This will shake you to the core. Since 2010 of the $1 billion spent in federal elections by super PACs, almost 60% of that money

came from 195 people and their spouses. Right. 195 people, 60% of campaign of super PAC spending. And is that crazy? It is crazy, but it's not that surprising if you really step back and look at what's been going on the last decade or so. And that's what people, I mean, some people say like,

spending tons of money on elections isn't bad. It's the fact that 195 people are the ones doing the majority of the spending. Right. That's not right. And that's a billion dollars spent by super PACs, or political action committees, and super PACs up until recently had to disclose

who donated money to them. So this is just the money that's traceable. And what we're talking about is the money that's not traceable here. So we're gonna go back a little bit in the wayback machine. Back to the early 20th century. Once again. Yeah.

And we're gonna talk about money in politics. There's this really good Mother Jones article called Follow the Dark Money. And it gives a bit of a history of politics and money. And says Congress is always reacting to some sort of money scandal. Right. But there's this long history and tradition

of knowing who is funding campaigns. Transparency. In America, yeah. And it started with Teddy Roosevelt. Teddy Roosevelt ran as a trust buster. He was against the big corporations that controlled so much in the robber barons. But he was also simultaneously secretly going

to these same corporations of robber barons and getting secret funding for his campaigns. Yes, one tycoon said Teddy Roosevelt got down on his knees for us. That's not the normal description of Teddy Roosevelt as far as corporations are concerned. Not the public image of him. Or any Teddy Roosevelt you wouldn't think

got on his knees for anybody. So as a result, after Roosevelt was elected, he actually did something about it. He signed into law the Tillman Act that prevented and outlawed corporations from directly contributing to candidates. That's illegal. Still is today.

It is. That's why we need loopholes. Watergate came along in the, I think the 1974, or 19, yeah, the 1972. 1972 election when Nixon was running for office. He... Re-election. Okay.

He accepted $20 million in 1972 money in secret political contributions. And we're talking like delivered in cash and checks in briefcases by couriers who were flying private jets from Texas to DC for Pete's sake. Yeah, and his personal attorney, when Herbert Kombach, he was the deputy finance chair for the Committee for Re-election for President.

He destroyed this evidence and went to prison for it. Yeah. So it was a real thing that happened. What's crazy is that their political action committee was the committee to re-elect the president. And the acronym was CREEP. They called themselves CREEP and they were trying to re-elect Nixon.

That's pretty funny. I mean, come on, it's a little on the nose, don't you think? Well, maybe it was lost on them. So you fast forward and you just say, okay guys, let's stop bashing Teddy Roosevelt and Richard Nixon. How about some Democrats in there?

And Bill Clinton was a really good example of that as well. Yeah, you wanna go jogging with Bill? Wanna play a little golf? Six figure check, please. Yeah. Access to the president or even somebody who's running for the presidency is not supposed to be purchasable.

You wanna sleep in the Lincoln bedroom? You or I? We can't do that. We don't have access to the president because we don't have that much money. So it's just simply not fair for somebody who does have that much money to have that much more access to the president or somebody running for the president.

So over the years there have been scandal and then some sort of change to campaign finance laws. But there's been this through thread over the 20th century that America has said, we wanna know who is giving money to candidates. We wanna know who they're indebted to when they win. Yeah, but there's also been a thread of every time law comes into action,

there is a loophole that is invariably found that can get around that. Right. Created by the same politicians who passed the act to begin with. Sure. Because- It's a game. It's really upsetting if you think about it.

Oh, it's very upsetting. I'm really doing a good job here staying calm. Well, you have a vein in your forehead that's pulsing. I can see it. Is there just blood spurting out of it right now? Yes. So Chuck, there's another thread too to all of this. It's semi-political and that is the tax code, right?

So if you go look at the tax code after 1913, you're going to see something called the 501c4 organization. That's right. It's called a social welfare organization or you can also be a local association of employees and be a 501c4. Those are also known as unions, right?

Correct. And as of 1913, the Underwood Tariff Act which brought back income taxes. The 501c4 organizations are nonprofits that are tax exempt, right? Yeah. And they can accept donations, but because of this, their 501c4 status,

they don't have to reveal who their donors are. Right, which wouldn't seem like a big problem because all nonprofits are people trying to save animals and save the rainforest, right? Social welfare ones, sure. So you want to just donate your money and I want it to be anonymous and it's no big deal. Right.

But that is not always the case. By the, well, late 1959, early 1960s, the government realized that politics and 501c4, were they 501c4s at that time? Yeah. Okay. They were intertwined. There was nothing they could do about it.

Right. And so they started loosening rules and in 1981, they said, you know what? You can be politically engaged as long as it's under the banner of the promotion of quote, social welfare, quote. Or that the work you're doing is primarily social welfare and the way that that translated as far as the IRS,

who enforces the tax code, as far as the IRS was concerned, it was if 51% of your funds are spent on social welfare, you can spend up to 49% on political stuff. Yeah, and the IRS had to fight for that designation because previously it just said primarily, which is such a loose word. Right. You know, they said, you know,

what does this really mean? Right. And so that they just through, I think they released an interpretation, a rule that said, this is what primarily means, 51, 49. That was the rule from 1981 on basically. Yeah. And so, okay, you've got 501c4s.

They're hanging out there over there. They're doing their own thing. Nobody's paying too much attention to them. And then 2010 rolls along. And there was a lawsuit that had made its way through the lower courts up to the Supreme Court. And it was called Citizens United versus the Federal Election Committee.

Yeah, it sounds so boring that I hazard to say that 90% of Americans have never even heard of it. And it may be one of the most influential Supreme Court rulings in the history of this country. Right. But it just, listen to it, Citizens United versus the FEC snooze. So Citizens United was a political action committee.

And, well, I think it still is as a matter of fact. And Citizens United was spending money on advertisements for a video on demand movie that was basically a attack ad, one giant attack ad on Hillary Clinton. I thought you were gonna say it was on those Kirk Cameron movies. I think it was similar.

He had a cameo, I think, right? Okay. And so in this movie, like the Citizens United didn't, I don't believe they funded the movie or financing, but they were running ads about it. And they were running ads within, I think, 30 days of the election. No, 60 days of the prime, no, sorry,

30 days of a primary election, which under the McCain Fine Gold Act, which is a campaign finance reform act that came along in 2002, you're not allowed to do. And Citizens United said, you know what? Why wouldn't we be allowed to do this? This is political speech. We're gonna sue the Federal Elections Commission.

And they did. It's free speech. And the Supreme Court ruled on it. And the Supreme Court in Citizens United ruled in favor of Citizens United. But then they released one of the most sweeping explanations of what they'd ruled that just completely changed the face of American politics from that point on.

It said, it's open season, bring in as much money as you want into the American political system because we are opening the floodgates as wide as they can go. Yeah, what they basically did was they equated speech with money. And they said, basically, they took the term money talks to the reaches that we can't even comprehend.

That you can make huge donations and that is a political statement. That is your speech is a corporation and you are protected because corporations are individuals. Right, so that's exactly what they did. They said, spending money on political campaigns, any political contribution is a form of political speech. Speech is protected under the First Amendment.

But the speech of individuals is protected. Well, corporations are considered artificial people. So therefore they should have that same thing extended to them, right? And so the ruling was that you can spend as much as you want as long as it doesn't go directly to a candidate. And you can also, now that since there's 501c4s, you can funnel as much money as you want to a 501c4

and remain an anonymous donor. Yeah, and the problem, well, there are a lot of problems. One of the biggest problems is these corporations are spending tons and tons, millions and millions of dollars. The court essentially said, Joe Shmo on the street donating $10 to a campaign is the same thing as a corporation donating $100,000 to a campaign. Right, exactly.

Because they're both individuals. Right. So it created this huge loophole. And I think the Supreme Court, what they were relying on was that these groups would be independent of the candidates. And that's not only not how it worked out, that was the plan all along. It was extremely naive, the ruling was.

And if you look at- Was it naive or was it? I don't know. But if you look at the, I have the same question. You know, a lot of people do. The, if you look at the ruling though, there's a section on transparency where they say, we the Supreme Court uphold the constitutionality

of requiring transparency in campaign financing. Yeah, that passed eight to one, right? Eight to one, which is like the only person descending was Clarence Thomas. Yeah. And it was like, yes, we're saying, you need to be transparent. And they said, okay, well, then transparency is going

to come through people demanding the corporations that they own stock in to release what political donations they've done. That makes total sense. If you have stock in a company, if your life's fortune is invested in a corporation, you should know who they're giving their money to. Okay, so that's one way.

And they also said, well, the Federal Elections Commission, they've got their job to do, the IRS, the SEC. There's all these regulatory agencies that are tasked with keeping transparency in the political process. And we're just going to rely on them. And as we're about to see after this break, relying on that was an enormous mistake.

Foolhardy. Learning stuff with Joshua and Charles, stuff you should know. On the podcast, Hey Dude, the 90s, called David Lasher and Christine Taylor, stars of the cult classic show, Hey Dude, bring you back to the days of slip dresses and choker necklaces. We're going to use Hey Dude as our jumping off point,

but we are going to unpack and dive back into the decade of the 90s. We lived it, and now we're calling on all of our friends to come back and relive it. It's a podcast packed with interviews, co-stars, friends, and nonstop references to the best decade ever. Do you remember going to Blockbuster?

Do you remember Nintendo 64? Do you remember getting Frosted Tips? Was that a cereal? No, it was hair. Do you remember AOL Instant Messenger and the dial-up sound like poltergeist? So leave a code on your best friend's beeper, because you'll want to be there

when the nostalgia starts flowing. Each episode will rival the feeling of taking out the cartridge from your Game Boy, blowing on it, and popping it back in as we take you back to the 90s. Listen to Hey Dude, the 90s, called on the iHeart radio app, Apple Podcasts, or wherever you get your podcasts.

Hey, I'm Lance Bass, host of the new iHeart podcast, Frosted Tips with Lance Bass. The hardest thing can be knowing who to turn to when questions arise or times get tough, or you're at the end of the road. Ah, okay, I see what you're doing. Do you ever think to yourself, what advice would Lance Bass

and my favorite boy bands give me in this situation? If you do, you've come to the right place, because I'm here to help. This, I promise you. Oh, God. Seriously, I swear. And you won't have to send an SOS, because I'll be there for you.

Oh, man. And so, my husband, Michael. Um, hey, that's me. Yep, we know that, Michael. And a different hot, sexy teen crush boy bander each week to guide you through life, step by step. Oh, not another one. Kids, relationships, life in general, can get messy.

You may be thinking, this is the story of my life. Oh, just stop now. If so, tell everybody, yeah, everybody, about my new podcast and make sure to listen, so we'll never, ever have to say, bye, bye, bye. Listen to Frosted Tips with Lance Bass on the iHeart Radio app, Apple Podcasts, or wherever you listen to podcasts.

All right, we're back. Boy, we're getting riled up today. I'm remaining calm still. I'm riled up. It's election season. So the Supreme Court said, you guys spend as much money as you want, spend it anonymously if you want. The only thing that remains illegal

is corporations contributing directly to candidates. Right, which once you have these loopholes, who cares? You don't need to anymore. Right, plus also, don't even worry about the mega donors donating directly to candidates, because there's requirements for reporting. There's transparency requirements. If you, under McCain Fine Gold, if you contribute $1,000

or more to a candidate or a PAC that has to report donors, you have to report it. Somebody's got to report it. There's transparency, right? The Federal Elections Commission, the IRS, all these guys are tasked with making sure that happens. So we're fine. Supreme Court went home and took a giant nap together

on their enormous nine-person bed. And here's one of the other big problems, is a lot of this money goes toward campaign ads, television ads, which have a lot of sway. Nine out of 10, and people have studied this, the Annenberg Public Policy Center, determined that in the 2012 campaign cycle, nine out of 10 ads funded by dark money were negative.

So that's why you see those negative ads. And not only that, but 26% of those were misleading. And there's no accountability. So they're being funded anonymously. And there's no fact checker. They don't have to run it by anybody to get approval and say, well, this is all true. It's not misleading at all.

So you can basically say whatever you want. The ad runs. It's anonymously funded. And someone's campaign is destroyed in the process. So the point is, as long as the candidate is not coordinating with the Political Action Committee, the Super PAC, or the 501C4, then it's all kosher. It's all legal.

And coordinating meaning, like, so blatantly, like, come on. It's still going on. So every election season, as it starts to kick off, you'll see on the news, like Ted Cruz or Bernie Sanders or whoever just released an eerie 12-hour tape of them doing different things with no soundtrack whatsoever. And the whole thing is, they'll release a reel. And it's them hanging out with their mom,

them riding a tractor, them standing on a mountain looking as the sun comes up. With their foot on the head of a small child. Sure. And it's just that. There's no sound to it whatsoever. And they just put it out there. I'm just putting it out there.

And then anybody who wants to use it can do whatever they want with it. And then the Political Action Committees, the Super PACs, and the 501c4s come along. That's raw footage. Use that footage to make their ads in support of the candidate. I kind of wondered, I was like, how are they getting this footage anyway if they can't be directly tied?

They're just putting it out there. I had no idea. Yeah. It's pretty cynical, really, if you think about it, the idea that they're not coordinating in any way, shape, or form. They're just putting all this raw footage out there. Sure.

And again, guys, like, if you're getting riled up, if you're Republican, when we say they, like, the Democrats do this, too, but it's really disingenuous to say that all parties are equally at fault here for using dark money. Because, again, studies show that if you quantify the amount of money spent by the GOP and by the Democrats, the GOP has outspent the Democrats mind-bogglingly so.

It's 83%, 83% to 17%. Yes, as far as using dark money goes. Yeah. It's definitely not a, like, Democrats do it for sure. And they sometimes do it cynically. I read about a dark money committee that released an ad in favor of Harry Reid, lambasting dark money.

That's pretty cynical as well. Wow. Yeah. So both sides do it. The Republicans just do it way, way more. Yeah. And I think Hillary Clinton has come under fire for her reliance on super PACs.

Right. Being attacked by Bernie, of course, who's, like, I don't want any part of that stuff, although there are some super PACs for Bernie, but I think he's disavowed them, maybe. Yeah. You have to look into that. George Bush disavowed the weekend passes ad, too.

You still benefit from it. It's not like he's, like, guys, you have to stop. Well. That was my Bernie standard. No, that was your Larry David. Right. Oh, wait. Same guy.

Leading up to the primaries here in New Hampshire and Iowa, not too long ago, Bernie came under fire from Hillary because there is a group called Friends of the Earth Action. They're a 501C4. And they are in strong support of Bernie. And she's, like, hey, dude, you're getting dark money, too, from this outfit. Right.

Friends of Earth Action said, hey, first of all, we've been around since the early 70s. We've been around long before dark money has been around. That's not what we are. We are mainly small donor-based. Do not compare us to these corporations. And they have a point in a lot of ways. You can't compare the Friends of Earth Action

to the Koch brothers. But I think Hillary was just trying to get in some, like, hey, you're not completely clean either. Right. It's true. And the Koch brothers, it's good that you mentioned them because they are basically the poster boys for dark money contributions, right?

Americans for prosperity spent $36 million. And that's their group, right? In 2012, yeah. Yeah. In 2012. And they actually got outspent by other groups, like Carl Rove created Crossroads GPS. And that.

All these names are so dumb. They spent $71 million in 2012. But the Koch brothers, in particular, have pledged $900 million for the 2016 cycle. That's how much they're going to spend on the 2016 cycle. And if you read up on those guys and their dark money contributions, or just their general political contributions, they've definitely

amassed a lot of friends in state legislatures, in the Senate, in the House. And the one that's left is the presidency. And they're spending a tremendous amount of money making friends with whoever's going to become president. All right. So let's talk for a second about does money win you an election?

Because that's really what's at the root here. All right. If money doesn't win you elections, then who cares? I take issue with that, but go ahead. What was the issue? Well, the issue is, like in this article, the author says, a lot of people raise a lot of money and flame out.

They don't make it even to the primary. Look at Jeb Bush. Yeah, I think he raised $103 million through super PACS alone. Yeah, and just burned right through it, didn't get anywhere with it. But that's a disingenuous, that's a straw argument, because it's saying like, yeah, you can raise all the money

you want and you're still not going to win. The thing is, somebody's going to win. And the people that help them win through these huge donations, they're going to be indebted to those people. Well, I'll help you out even further, my friend. OK. People that say you can spend a ton of money and still not win, who he or she who spends the most money almost always wins.

Yeah. Yeah. Not sort of, yeah, nine out of 10 in the House and eight out of 10 in the Senate winners are the people who spent the most money. Oh, is that right? Yeah, 82%, 94%. Yeah.

So you can't ignore that. If you raise the most money, you have an eight or nine out of 10 chance of winning. I got you. So money is buying elections. It is. And then people say, well, if these are, as long as the PACS and the super PACS and the 501c4s

all stay separate from the candidate, and there's no coordination, and there's no crossover, whatever, then the candidate's not indebted to these people who gave $900 million to their campaign, which is just the most ridiculous assertion you can possibly think of. Yeah. And I really, I read this.

I think it was a Bloomberg article or US News. I can't remember. And it basically explained it how you're indebted to these people. It's not necessarily nefarious, although I'm quite sure there is a tremendous amount of nefariousness out there. But even if you remove the nefarious angle, right? Yeah.

If you are a presidential candidate, and you're moving and shaking, yeah, you're going to the local diner somewhere in Rhode Island or whatever and shaking hands or whatever. But the people you're really interacting with, that you see over and over again at the same fundraisers, those are mega donors. You don't see the dude who's sitting at the diner

asking you a question more than that one time at that one diner. You see him in the photo op. You do see the same mega donors time after time after time after time. So at the very least, they have your ear. And even if they don't have your ear, they become who you think of when you think of your electorate. These people who you saw time and time and time again

who contributed money after money after money. So even if you're not saying, yeah, give me some money and I'll make your legal troubles go away with the IRS, even if it's not quid pro quo like that, there's still a mentality that crops up where if you're exposed to these people who are giving you tons of cash to get you elected, you're going to equate their help

with your success at being elected. That's at the very least how it influences politics. Yeah. All right, we definitely need to take a break now because you have blood coming out of your eye ducts. Letting stuff with Joshua and Charles, stuff you should know. On the podcast, Hey Dude, the 90s called David Lasher and Christine Taylor, stars of the cult classic show, Hey Dude,

bring you back to the days of slip dresses and choker necklaces. We're going to use Hey Dude as our jumping off point, but we are going to unpack and dive back into the decade of the 90s. We lived it, and now we're calling on all of our friends to come back and relive it. It's a podcast packed with interviews, co-stars, friends,

and nonstop references to the best decade ever. Do you remember going to Blockbuster? Do you remember Nintendo 64? Do you remember getting Frosted Tips? Was that a cereal? No, it was hair. Do you remember AOL Instant Messenger and the dial-up sound like poltergeist?

So leave a code on your best friend's beeper because you'll want to be there when the nostalgia starts flowing. Each episode will rival the feeling of taking out the cartridge from your Game Boy, blowing on it and popping it back in as we take you back to the 90s. Listen to Hey Dude, the 90s, called on the iHeart radio app, Apple Podcasts, or wherever you get your podcasts.

Hey, I'm Lance Bass, host of the new iHeart podcast, Frosted Tips with Lance Bass. The hardest thing can be knowing who to turn to when questions arise or times get tough, or you're at the end of the road. OK, I see what you're doing. Do you ever think to yourself, what advice would Lance Bass and my favorite boy bands

give me in this situation? If you do, you've come to the right place because I'm here to help. This, I promise you. Oh, god. Seriously, I swear. And you won't have to send an SOS because I'll be there for you. Oh, man.

And so will my husband, Michael. Um, hey, that's me. Yeah, we know that, Michael, and a different hot, sexy teen crush boy bander each week to guide you through life step by step. Oh, not another one. Kids, relationships, life in general can get messy. You may be thinking, this is the story of my life.

Just stop now. If so, tell everybody, yeah, everybody about my new podcast and make sure to listen so we'll never, ever have to say bye, bye, bye. Listen to Frosted Tips with Lance Bass on the iHeart radio app, Apple Podcasts, or wherever you listen to podcasts. All right, we're back. Are you good?

You got the tissue? Yeah, I'm good. You're crying bloody tears? I'm good. I get riled up too, man. When you look at the state of American politics these days, it's very hard to not want to go live on a deserted island somewhere and start your own oligarchy.

Yeah, I rule myself. Monkeys. I wonder what it's, I don't know much about politics around the world. I know other wealthy countries are corrupt as well. I feel like we're leading the race, though. Maybe not. The race downward?

Yeah, I'd like to hear from other countries out there, other big, wealthy countries about your systems. I'm sure they're largely broken, right? Are we the only ones? No, we're definitely not the only ones. I mean, you can look at it right. The Finns. I don't know.

I bet Finland has got it all together. I mean, you look at Scandinavia and you're like, yeah, they're like a model of using taxes for good and all that, but how much of it do you not hear about? Like, how much waste is there? How much graft is there? Well, they pay so much in taxes over there, but everything we hear, though, from people in that part

of the world say we're happy to because everything's great. Like, we have no crime. We have no gun violence. Everyone's healthy. We all get health care. Schools are awesome. We're all happy. I don't know.

Maybe I'll move to Finland. So we talked about why, how money influences politics. But the underlying key is this. If you can purchase campaigns, you can purchase everything else because you get people who owe you or who you've influenced or who you just share a tremendous amount of common viewpoints with into office.

You back the right horse. Your guy got in there, right? You can put it as crassly or as nicely as you want, but you help get somebody into office and now they kind of owe you. And now, the policies are probably going to fall into your favor. And just the ability to do this is such a symptom

of the inequality in the United States that we're dealing with right now, that I think that's what disheartens me the most. It's like when the Supreme Court ruled in 2010, we're opening the floodgates. It basically said, you have no voice, individual. Yeah, but yeah, it did. But did we ever?

Was the Supreme Court really just saying, like, hey, we're going to take the scales off your eyes? Right. We're not going to take away any pretense. Here's how it is. Here's probably how it's always been. But now, it's legal, man. Just get used to it.

Yeah, but no one was paying attention. But I mean, back in the 70s, when Watergate happened, people paid attention to that. You know, like the idea that if you were wealthy, you could become an ambassador for $250k or that you had access to the president. It's always ticked Americans off. That's true.

So remember when we talked a little bit ago about the 501c4s have to, 51% of their spending cannot be political, no comment on that part. But it's unenforceable, basically. Well, IRS did try to enforce it once. Yes, that's where I was headed. The IRS made the mistake of going too hard at the Tea Party because they felt like they were the worst offenders.

And it backfired on them in a big way, to say the least. Well, yeah, well, the GOP in Congress came down hard on the IRS. They got the IRS director removed from her position, got a new person installed. And this new guy has basically said, like, you know, I'm just going with everything the Supreme Court thinks. So I'm going to stop enforcing this.

And even if the IRS wanted to enforce these rules, that they're tasked with making sure that there's transparency, right? Yeah. The Senate actually inserted a couple of bills. And by Senate, I mean Mitch McConnell, who hates campaign finance laws. He got a couple of bills inserted in the omnibus spending

bill. A couple of riders. Yes. And if you guys, a lot of people may not know what an omnibus spending bill is. It's basically a big, large, sweeping set of many, many bills and riders all under one banner. It pays.

It's the government's budget. Well, yeah, but they don't have to do with one another. You can, when you hear like a rider was attached to it, that a lot of times means someone is trying to sort of sneak something through. Right. So if you attach a rider to the right bill, you can get almost anything passed.

And I shouldn't say sneak something through, because it's not like it's in secret. But it's a very convenient way to pass a controversial amendment. Right. OK, so if you take a very cherry bill, like one that has to pass, like the bill that pays for the government's spending for the next year,

and you insert a rider in there that says the IRS is not allowed to make clear rules on 501c4s and political action committees spending on politics, you're going to get it passed. And it did get passed. Yeah, and another thing that got passed was remember when we talked about the fact that shareholders wanted to know if their corporations, who they were donating to, they also got a,

almost had snuck it in. They almost also got in a rider that said, no, corporations don't have to do that. They did. They said that they said that the SEC is not allowed to make rules considering making corporations disclose political contributions. Yeah, you cannot force them to do that.

So there's a ban on the IRS clarifying its rules and the SEC creating a rule. Just clarifying. They just wanted it more clearly defined. Right. In an existing rule. Can't do that. We like it really nebulous.

So Congress said, sit down. When it comes to campaign finance stuff, you don't do your jobs anymore. Your regulatory stuff is over with now. Individuals have petitioned these companies. And sometimes they voluntarily given it up. But if that's the solution, then it's not much of one. Right.

And then so lastly, so the SEC is down, the IRS is down. And the last agency that was tasked with enforcing transparency was the Federal Elections Commission itself. Yeah, surely they would step up and do the right thing. So the Federal Elections Commission is now split three and three along party lines and apparently deadlocks as a matter of routine. Yeah.

So you need four commissioners, four FEC commissioners to take action on anything, to get a quorum, right? They can't even get a quorum. So as far as campaign finance stuff goes, they have been sitting on their hands since 2010. And there was a couple of rulings about transparency that are about the last things they did. So in 2007, they said, you know that McCain-Feingold

requirement that says, if you spend $1,000 or more contributing to a political group or campaign, you have to disclose it? Yeah. We, the Federal Elections Commission, decided that that means that if you spend $1,000 or more on a political communication, like an ad, then you have to disclose it.

So that means that if you contributed $1,000 to a political action committee, you would have to say, this is for ads. Well, and for this ad specifically. That came later. But yeah, that's the way it is now. Which no one ever does, it's another loophole. So this last thing, this last bastion of transparency

to where you had to say, I donated $1,000 or more, you would have to say, it is not just for an attack ad. It's for attack ad number 238, Hillary hates America. That's what this money is for. And like you said, no one does that. Well, because they don't have to. So as far as the Federal Elections Commission is concerned, you don't have to say, you donated that $1,000.

Yeah, they don't have to, so they won't because they don't want their name attached to it, which is the most cowardly thing you can do if you think about it. Well, yeah, there's this, well, that's the argument. That's a lot of people's argument is anonymous political speech keeps you from getting blowback from the powers that be or whatever. And there was this woman who was caught handing out anonymous

pamphlets that she wrote outside of a polling place, which apparently was illegal under McCain Feingold. And everybody was like, well, there's a long, proud tradition of handing out anonymous. Sure, common sense by Thomas Paine. Right, the Federalist Papers were originally anonymous. And Justice Scalia, who died recently, he was actually very, very conservative.

And in his dissent on that ruling, in favor of the woman's right to hand out anonymous pamphlets, said, anonymous pamphlets have about as much historic tradition and precedence as anonymous phone calls in this country. They're not honorable or something honorable about anonymously lambasting something. That didn't translate to the rest of the court,

as far as Citizens United is concerned. Yeah, it's the equivalent of going in the dark of night and like spray painting something on a wall and running away. Right, it's true. So here's where we're at right now. The Supreme Court ruled that corporations are people. They already had ruled that they upheld it. Political money is protected speech, right?

Yeah. So this opened the floodgates to unlimited money to 501c4s, which are nonprofit action groups who do not need to disclose their donors' identities, which means that you could contribute as much money as you wanted to anonymously to a political campaign. So the SEC was banned from requiring corporate disclosure. The IRS was banned from investigating the political

action groups themselves. And then the FEC, the Federal Elections Commission, removed the last transparency requirements of the donors. And an estimated $10 billion is going to be spent on this 2016 campaign. $5 or $6 billion on the presidency, right? $2 billion was spent in 2012. So the big question here is, are you, the individual,

upping your political contribution five times, do you account for this enormous increase from $2 billion to $5 or $6 billion? No. No, of course not. So there are some folks that started digging around and said, all right, who's funding some of these efforts, maybe like climate change denial?

Somebody's funding this stuff. So there's a guy named, well, at Drexel University, an environmental sociologist named Robert Brewell, he said, let me look into this and see somebody is giving a lot of money to climate change denial. And Exxon was given a ton of money, like blatantly, for years and years. And again, the Koch brothers.

The Koch brothers. And we all knew that because it was all on record. But a weird thing happened once these changes came about. The Koch brothers, Koch Industries and Exxon Mobile, their cash flow to climate change now disappeared without a trace. Yeah, they're traceable stuff. But 140 foundations funneled almost $600 million

to about 100 climate denial organizations since then. And their money dried up. This money increased. To anonymous 501c4 groups. You don't need to be a Sherlock Holmes to figure out what's going on here. Yeah, and the other thing about a 501c4 is let's say you have a really great political action

committee or a really great social awareness group, right? Yeah. Or social welfare group. And you don't want to let that brand die because it's really established itself. But you don't want to keep funneling money to it because climate denial has a bad name these days, right? You can funnel money to a 501c4 that

funnels money to that political action committee. Well, that's what's happening. And your donation, it's basically laundered. You're laundering your donation, turning it anonymous. But it's still having the same effect, the same outcome. Yeah, thanks to that loophole. Yeah. And then one more, Chuck, one more criticism of this whole thing

is if you say so what, who cares? This is the way the world works, especially with corporations in particular. If they start doing what's called rent seeking, which is there's an established pie. And when you rent seek, you go to get your piece of the pie. It keeps you from innovating. You start spending your money on legislation.

Yeah, it's like rent seeking is basically if you're a big corporation spending $100 million on lobbying for regulations against your competitor instead of spending that $100 million investing in your own corporation to grow, which is no good for shareholders. No, your bottom line still kind of goes up. But really, you're just reaching the path

towards stagnation because you're not innovating anymore. And the public loses out because regulation decreases. Jobs are lost because you're not innovating. And then as far as consumers are concerned, there's less stuff to buy because corporations are going for the piece of the pie rather than making the pie bigger or creating new pies. Yeah, going for the money that's already out there.

So the solution, I think, is strictly public financing of campaigns. I have no problem with that. Just say, here's $100 million to the candidates who won the primaries and get creative. This is all you got. It's illegal to use another penny outside of these public funds that were just given to you as the party candidates.

Go to it. Everything else is totally illegal. I can't imagine what a sea change it would be in politics. I can't imagine. There would be another loophole. Well, you know what would happen is suddenly these political action committees would start attacking this idea saying, you, Joe Schmoe,

you can't vote with your political speech from your campaign contribution being restricted. Your First Amendment rights are being restricted. You're $50 that you were going to give to your candidate. Which is suddenly taken on huge dimensions of import. It's being restricted. And that's exactly what would happen. So we move into Finland?

No, we need to take this country back, man. What's the best country? That's what I want to know from listeners. Which one's the best? Oh, I can't wait to hear. Costa Rica? That's pretty nice, right? Sure.

If you want to know more about campaign finance, dark money, all that jazz, we want you to go check it out. Look up Dark Money in the search bar at HowStuffWorks.com and just check out Dark Money all over the web. Oh, yeah. Including Jane Mayer from The New Yorker wrote a really interesting book called Dark Money all about the Koch Brothers.

Yeah. Fantastic. Well, since I said Jane Mayer, it's time for Listener Mail. All right. I'm going to call this one maybe appropriate for this. Well, not really. Somebody funding us secretly? This is from a coal miner about our Bill Gates podcast.

He said, hey, guys, one problem that no one ever seems to talk about with renewable energy is the people. The people, you ask. Well, I was an underground coal miner for seven years until the market got so bad that I lost my job. And I'm just one of 7,000-plus people here in eastern Kentucky that has been hit hard by this. I'm not saying we need to stick with coal.

It's just the people don't think about the people that are behind the fossil fuel industry losing jobs. Not only are people losing their way of life, but entire towns are being killed. I can't count how many people have had to leave the place that they've called home their entire life to find work. Along with new renewable, cheaper energy, we need to find jobs to fill that void of those who

have been lost. I was greed. Yeah, you know? Yeah. I mean, it's not like, because creating renewable energy creates a lot of jobs, but they're not going to the coal miners, you know what I'm saying? Yeah.

But however, this is kind of neat. I was lucky enough to find work at BitSource, a tech startup here. The company hired 10 former coal miners and began teaching us how to web and how to be web and software developers. Awesome. The only problem is there are only 10 of us,

and it's just this one company, and they cannot fill the void of all those who lost jobs. I know that you guys might be able to help shed some light on this problem. Like I said, no one thinks about the people and the families that are hurt by progress, but it happens. Someone told me once, you can be the best wheel maker out there, but if no one needs wheels anymore,

doesn't matter how good you are. Thanks for the podcast. I'd love to listen on my drive to and from work. That is Michael Harrison. That is a great point, Michael. It is. Somebody should do something, or maybe train these people in new renewable energy forms.

Sure. And this BitSource company is a pretty good example of how the market can swoop in and foster progress, basically, right? Sure. But the fact that they're hiring 10 coal miners out of 7,000 who need jobs is also an example of how the market doesn't do that.

And like you could, this is where government comes in. Government spending. Say, OK, let's move forward and lay the infrastructure for an enormous high-speed internet national grid. We need people to install that. We need people to design it. We need people to develop it. We need people to maintain it.

Let's take people who don't have jobs, train them to do this stuff, build this infrastructure, and just take off like a rocket from there. Yep. That's one thing you could do. Agreed. Man, we're going to get some mail for this whole episode. Good.

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