The Daily Signal - Arabella Network's Leftist 'Dark Money' Influence Expanding, Author Reveals

Episode Date: April 29, 2024

The left-wing Arabella Advisors network has raked in more money than either of the two major political parties and affects almost every element of public policy and elections, argues Scott Walter, president of the Capital Research Center, a Washington-based investigative think tank.  Walter's new book “Arabella: The Dark Money Network of Leftist Billionaires Secretly Transforming America” shows that in the 2020 election cycle, Arabella Advisors' nonprofits took in $2.4 billion. That's $1 billion more than the combined fundraising of the Democratic National Committee and the Republican National Committee.  That amount rose to $3 billion in the 2022 election cycle, Walter says. Moreover, he adds, nothing on the Right comes close to competing.  Listen to Walter outline Arabella's reach in a discussion of his book on today's podcast. Enjoy the show! Hosted on Acast. See acast.com/privacy for more information. Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Daily Signal podcast. For Monday, April 29th, I'm Fred Lucas. Today we're talking to Scott Walter, President of the Capital Research Center, about his new book, Arabella, the Dark Money Network of Lettus Billionaires secretly transforming America. Scott served in the George W. Bush administration as special assistant to the president for domestic policy and was vice president at the Philanthropy Roundtable, editing philanthropy magazine, producing donor guidebooks on assistance to the point. poor public policy research and other topics. Walter has testified to five different congressional committees about Arabella and related subjects

and about dark money nonprofits to the U.S. Senate, the IRS, and state legislatures. Stay tuned for my conversation with Scott Walter after this. This is Mike Howell at the Heritage Foundation. I know how the left and the deep state operate because I've seen it from the inside. When I was working for the Trump administration, I learned how the left made our lives miserable and how they continue to think they can play by their own rules. Well, now we're taking all of these tricks and tactics that were deployed against the Trump administration

and turning them against the Biden regime. Through the work of the oversight project, we're exposing the left for what they are and embarrassing some actors responsible. We're using strategic foias and fearless litigation to force these bureaucrats to deliver documents they'd prefer to never see the light of day. But for our work to be successful,

we need patriots like you to stand with us. You can take action now. Visit heritage.org slash oversight to learn more. There's no time to waste. We're back with Scott Walter, author of Arabella, the Dark Money Network of Lettus Billioners Secretly Transforming America. Thanks for joining us, Scott.

Great to be with you, Fred. So just to start with, we've written about Arabella here, the day the signal, but I think a lot of people out in America don't really fully understand the power and the depth of this network. So can you just, for starters, explain what is the Arabella Advisors Network? Sure.

And you put it exactly right. The first thing to understand is it's a network. It's a group of groups. And you can visualize a pyramid, right? At the top of the pyramid, you have Arabella Advisors. That's a for-profit PR firm, what they call in D.C. Beltway Bandit. Now, it actually creates and operates everything below it in the pyramid. In the middle of the pyramid, you have half a dozen non-profits of more than one type.

And then at the base of the pyramid, you have what ordinary Americans see, and that is hundreds and hundreds of these fake groups with names like Floridians for a fair shake and Center for Secure and Modern Elections and Opportunity Wisconsin. They're designed to sound like it's your neighbors in a grassroots advocacy group, but in fact, it's just a website and an accounting code in a DC office. And would you say at this point, the Arabella network has displaced the George Soros network or the Soros family network as sort of the biggest funder of the left-wing causes? Well, Arabella definitely takes in and spends even more than Soros' network. And they work together, however, in multiple different ways. So they're not rivals. They're allies. Right.

Okay. Okay. Yeah, right. Right. I would you say Arabella, is it more secretive than George Soros in some ways. Oh, definitely. The Soros' main foundations and political non-profits, they have, you know, they exist as independent entities and they have to do a fair amount of disclosure through the IRS and elsewhere. Whereas the whole point of Arabella's arrangement is for those hundreds of groups at the base of the pyramid that are what ordinary Americans see. Well, those are not independent legal entities that have to report things like who's our board members and what did we spend on fundraising and what did we spend on lobbying and whatnot those individual groups don't do that it's only the umbrella nonprofits in the middle of the pyramid they have to make uh non-profit disclosures

but since they're an agglomeration of dozens or even hundreds of the uh bottom line groups, it all gets amalgamated. So if there's 100 different groups doing stuff in one nonprofit, you can't tell from that one nonprofit's disclosures, who is giving money to what, how much did a particular group spend, who did that particular group even employ to run things, et cetera. It is interesting. I mean, someone like Sheldon Whitehouse. He goes on these tirades on the Senate floor so often and in committee meetings.

and we'll talk about the Coke problems and so forth that he considers such a grave threat. He never talks about anything like Arabella and neither do other Democrats. Well, I know all about Sheldon White House and his prevarications. I've testified to the man four times now. Always, I talk a lot about Arabella and point out that if he actually cared about dark money, he would talk about it. But Fred, would you care to guess how many questions I've gotten from Sheldon White House in those four different hearings? I'm betting zero on Arabella, at least. Absolutely zero. He's never asked me a question. I've never had a Democrat member at any of the half-dozen hearings where I've testified.

Ask me a single question about these things or about anything else. and I promise you, you can go to capitoloresearch.org and search for Scott Walter testifies. I have laid before Sheldon White House in great detail, all of this. And as far as I know, the word Arabella has never escaped his lips. Right. And, I mean, on some level you would expect, I mean, the Democrats are going to aim towards conservative, dark money groups, conservatives will take their aim at liberal dark money groups. But Arabella, is it fair to say Arabella is more organized and more influential than anything

the right has right now? Well, first of all, it certainly just has more money, period. It takes in, in a given election cycle, it takes in two to three billion dollars at this point. and there is definitely nothing on the right that equals that. And then the other thing to note is that to the extent anybody tries to point to things like this on the conservative side, they'll typically point, for instance, to the Coke networks. That's K-O-C-H Coke networks after Charles and David Koch, the billionaires who first started it. David is no longer with us. the thing is, not only did that network not take in as much money, but also that network has not been for almost a decade.

That network has not been very closely aligned with the Republican Party. They have not liked the populists and the Trump folks and the rest, whereas Arabella is absolutely joined at the hip with the Democratic Party. Looking ahead, when you're going to be testifying in Congress or in state legislatures, where are you going to be telling our leaders and government about Arabella? Well, my next testimony is on Tuesday morning to the House Natural Resources Committee. So I will be talking about all sorts of left-wing dark money that have tried to influence environmental policy. the Secretary of the Interior, which is overseen by this committee, and will be testifying the day after me. Her daughter is highly active with lefty activist groups, and people argue that, in fact, as improperly lobbied her mother. And Arabella also continues to be very active in the environmental policy area in all sorts of

ways. Who are the biggest donors to Arabella, or is that just difficult to know just because it is such a dark money off it? Well, remember, the way it works for this sort of nonprofit world is the institutional donors like Soros's Open Society Foundation or Warren Buffett's Susan Buffett Foundation. Those institutional donors themselves typically have to disclose that they've given money to Arabella nonprofits. But when a person just writes a check off of his company or his personal checkbook, those do not have to be disclosed ever. Now, we have tracked the institutional donors, and we can tell you that for almost all of the Arabella nonprofits, Fidelity Charitable Gift Fund, which provides donor advised funds to wealthy people, it is the largest, typically,

donor. Now, ironically, donor advised fund providers have been savaged by Sheldon White House, too. Of course, only conservative ones does he savage. He totally ignores the left-wing ones. Other really big donors to the Arabella network have been Bill Gates. He is one of the largest, mostly through his foundation. Mark Zuckerberg has given tens of millions, mostly for criminal justice reform, quote unquote, which, you know, letting criminals back on the streets. Another person who's really important and has been one of their biggest donors for the two decades they've been around is Hans Jurg Vise. Probably nobody's heard of him who's listening, but he is a Swiss billionaire. He's not a U.S. citizen, therefore he's absolutely not supposed to be meddling in American politics.

And he used to write checks to candidates and campaigns like the Friends of Dick Durbin Committee, which is completely illegal beyond any doubt. Unfortunately, he wasn't caught at that until after the statute of limitations expired. He's gotten smarter. He doesn't do that anymore. Instead, he writes checks to Arabella nonprofits, which is a gray, murky area in the law. Right. And we talked earlier about these various pop-up organizations.

what have been some of the more effective pop-up groups that showed up during an election cycle or a legislative fight and then just disappeared after that? I mean, what were instances where these pop-up groups probably managed to get someone elected or managed to win a particular legislative fight, either in a state or at the congressional level? I'll give you two examples. One would be the demand justice, which was spawned. in the Arabella Network, and it existed to attack, or initially existed, to attack Trump judicial nominees, but it still is in existence. And for instance, everybody listening to this will know one of its former employees, Jen Saki came from Demand Justice, and then went and became the top spokesman for the Biden administration. Demand Justice helped to

pick the nominees to courts by the Biden administration, including Katanji Brown Jackson, for instance. They also had one of their members in the White House Counsel's Office, which is one of the central parts of the federal government picking justices. So they continue to be active. They're trying to pack the court with extra justices. They're also trying to smear the court so as to force recusals, which would shrink the court. They're also pushing bogus ethics legislation, mainly with the help of Sheldon White House again. So again, it's laughable for him to complain about dark money when he works hand and glove with these people. Another group from the Arabella network I would point out, because it was just in the news this past week or so,

that the Department of Education completely revamped the Education Department's Title IX rule. which governs men, forcing men into women's sports in schools. That was plotted through a highly secretive group in the Arabella Network, funded entirely with Soros money, a little thing called governing for impact. They have started in 2019 two years before the Biden administration was even sworn in, and they worked with Harvard Law School folks to do very sophisticated, legal strategy memos of how to overturn dozens of regulations in the federal government,

the most famous being the Title IX. Would you say Arabella is primarily focused on policy or politics? Well, the answer to every Arabella question is everything. Arabella does not discriminate. It is working on arcane regulatory issues like we just mentioned, but it also is, you know, running Facebook ads, attacking certain congressional candidates and boosting others. It plays in environmental issues. It plays in abortion issues. It plays in election policy. The Center for Secure in Modern Elections and Institute for Responsive Government, those are two fake pop-up groups in Arabella's network that work with the charity, quote-unquote, that receive.

received most of the 400 million plus Zuckbucks in 2020. Wow. Okay. And back to demand justice. I mean, that was essentially started as sort of a pop-up group itself, and then it became big enough to spin off into its own nonprofit, right? That is correct. Although I don't think it's a function of the size that caused it to spin off.

I think it's because we had been savaging it for years, and it was an embarrassment to be inside this giant dark money network. Now, the second it left, guess what? It's still got huge sums of money, big chunks of its budget, was money passed through the Arabella network. So it wasn't really very independent, isn't really very independent. How effective have they been being,

because I know they've been identified also as sort of an incubator to try to get stark nonprofits. beyond demand justice, how often have we seen groups spin off and how independent have they been? Well, as I said, even once the groups spin off, they typically continue to get fat checks from passed through Arabella, which makes the independence very questionable. Another group would be fix the court. So this two was spawned inside of Arabella. It is a 501C3 charity, unlike demand justice, which is a 501C4 political nonprofit.

But those two groups have worked very closely together. Again, their job now is to be smearing the conservative majority on the court and boosting left-wing justices. So to show you how they work like that, when Stephen Breyer, a Democrat appointed Supreme Court justice, was being pressured to retire early so that Democrats would be able to put somebody to take his place, if a younger justice to take his place, demand justice was the ringleader for that, including running trucks around town with little miniature billboards savaging him, and then bragging that they were able to force him off the court. similarly, the Fix the Court charitable side of that pair of groups from Arabella.

They have been smearing the court and demanding greater disclosure by justices and the rest, and they have been used heavily by Sheldon Whitehouse and his attacks and smears on the court. The New York Times, The Washington Post, both in news stories and in their editorials, will quote, fix the court as if it's some grand pooh-bah of ethics wisdom, when in fact, here's the great irony, Fred, fix the court in its own disclosures, as we discovered and pointed out and got them embarrassed for, in multiple ways they lied on what they put down for their disclosures to the IRS. And they had to amend their returns and apologize and the rest.

I mean, you just can't make up a bigger joke. Plus, it's basically one guy in his apartment, and it's treated like it's some big, serious, thoughtful place. So, you know, when you realize how little money Arabella had to put into this one goofball in his apartment, in order to have senators and major newspapers take his junk seriously and magnify it massively. That's a lot of bang for the buck. We talked about policy versus politics. How does Arabella impact U.S. elections and how much political power do you think they have in 2024 and maybe going forward? Well, don't take my word for it. In the case of their largest 501C4, which is a political nonprofit like the NRA or League of Conservation Voters, Politico, for instance, which is no conservative news outlet,

They talk about how the 1630 Fund, the Arabella's largest C4 group, is the political powerhouse for Democrats. It is a major player in congressional races every single cycle, typically pouring in more than $100 million in ads and Super PAC support. So that's just a very big thing. And similarly, again, don't take my word for it. Don't take any conservatives word for it. The New York Times talks about how Arabella is the largest dark money network supporting Democratic candidates and causes. And the Atlantic magazine, again, very liberal outlet.

They ran an interview a year or two ago with the then president of Arabella and were scathing about what a colossus of dark. money the place was. And the headline for the story was something like the biggest dark money network you've never heard of. The Democrats used to decry dark money, but now they beat Republicans in it. And this group is the biggest reason for that change. for the most part, I mean, do you feel like the mainstream media sort of turns a blind eye on Arabella, whereas they might not, I mean, wouldn't with the Coke network? It is empirically demonstrable that the left-wing media have not begun to give this network

anything like the kind of exposure that they have done to conservative non-profit. and networks such as those from the Cokes or those connected to conservative judicial activists, those have received far, far more words, far more interrogation. They're not remotely equivalent. The nice thing is that once in a while you will find a left-wing outlet admitting this. The book documents that in the 2020 election, Arabella's nonprofits took in about $2.4 billion. That was more than both the DNC and the RNC combined. Is that right? A billion dollars more than the DNC and R&C combined.

And then in the 22 cycle, which is an off year, so you'd think it would go down. Nope, went from $2.4 billion in 2020 to $3 billion in 2024. that was half a billion dollars more than the DNC plus the RNC plus both parties, House and Senate fundraising committees. Wow. So that tells you probably that the Democratic mega donors feel like they're going to get a better return on investment for them and running into Arabella network than maybe the traditional party machinery. That is absolutely true.

And by the way, another thing to say about 2020 to show you how they, Arabella plays in elections in nefarious ways, but also effective ways, Jay Christian Adams is one of the top election integrity lawyers in America, and he and Heritage's great Hans von Spakovsky, I believe they would both tell you that in their view, the single biggest factor in the 2020 election was the the Zuckbuck's operation. Now, most of that money went from a donor-advised fund of Zuckerberg's to two charity, quote-unquote charities. But the charity that got most of his money, about 350 million of the 420 million of Zuckerberg's, also received $25 million from Arabella's biggest charity. Now, that was not disclosed until a full year,

after the election. And I used to have fights with the New York Times and other places about whether these Zuckbucks were what they claimed to be, which is just, oh, helping the poor election officers during the COVID crisis, or, in fact, were a partisan turnout operation. And there was a lot of resistance in the mainstream media to the idea it was a partisan operation. Well, if we had all known that Arabella was putting in $25 million into this scheme, I don't think anybody would tried to pretend it wasn't a partisan operation because that's that alone is the absolute proof this is partisans turning out votes for their preferred political party what kind of impact do we expect the arabella network to have in 2024 and future elections in based on this well you know there's a

whole other area that we haven't gotten into and that is ballot initiatives the left has been very active in the last few years in ballot initiatives and they are going to have some important ballot initiatives and the state, various states' ballots this year, not just because they care about whatever the policy in the ballot initiative might be, such as abortion or laws for a state, but above all, because they hope to drive people to the polls, they hope to drive Democrat voters to the polls with those ballot initiatives. Arabella will often be the single biggest donor to ballot initiatives. And here's yet another campaign finance reform problem, the bogus reforms in campaign finance.

They squeezed money out of the political channels where political money belongs, right? If you want to play politics, you should be giving money to candidates and parties, which also, by the way, have to disclose that. But campaign finance reform made that hard to give to, but it has no restrictions whatsoever on the nonprofits. And the nonprofits have no limits to how much you can give them and don't have any disclosure rules. So multiple 501C4 groups in the Arabelan world are heavy players in ballot initiatives, and

including the C3, sorry, not just their C4s, but also their C3 charities. And guess what? We have no way of knowing whether Hans-Yorg visa's foreign money is going into those state ballot initiatives. They claim that it's not, but they refuse to provide any evidence even when a sycophantic news outlet like Bloomberg is doing a news story on this, right? They could confidentially show their books to Bloomberg and say, see, here's how we segregate the foreign money out so it doesn't go into this. They didn't do that when Bloomberg was dealing with. doing a puff piece on them trying to defend Hans Vise just two or three months ago. With regard to the title, Mitch is transforming.

Do you think Arabella is succeeding in transforming America? Well, they haven't completed the transformation, thank God, because, of course, the large majorities of Americans are opposed to the Arabella left-wing agenda. So, you know, it's not a foregone, they haven't finished, it's not a foregone, conclusion that they will, but they are a huge threat that people need to be much better aware of and much more focused on. Okay. I guess going forward, I mean, is there anything that lawmakers can do?

I mean, legal changes that can, and some might curb the cloud of the Arabella network or groups like it? There are multiple things that could be done. First of all, the state attorneys general, for almost every state, that person is the top cop, as it were, for nonprofits in their state. And they could be doing investigations and filing lawsuits. That has happened in Louisiana only, and that's continuing, so we don't know how that's going to turn out yet. but the other things that could be done are just greater exposure because Arabella is essentially a Wizard of Oz operation right?

The Wizard of Oz was real scary when you went in the auditorium, he saw the great big, scary booming thing. But then when you discovered that it's just some guy with the microphone behind a curtain, well, Oz isn't so scary and powerful anymore. So education is really important to learn more about this. So thank you. You're doing that right now. You're exposing your big audience to this.

And then there are a couple of, of laws. Thank you for on the book. Well, my pleasure. There are a couple of laws that are also being contemplated. For instance, laws that would say, if you're a C4 political nonprofit and you take foreign money, then you're not allowed to give money to Super PACs. That's a very reasonable law.

There's another law, Claudia Tenney, head of the Election Integrity Caucus in the House. She has proposed that charitable groups should not be able to spend any money on voter registration and get out the vote. That too would make a big difference in the Zuckbuck style operations. All right. I think that's all the questions we have. Is there anything else you would like to share with our audience? I just want to say, great to be with you, Fred, and thanks for all the great works of the Heritage Foundation. Always a pleasure to collude with you. Yes, thanks so much for joining us and thanks for educating the public about Arabella. My pleasure. And that'll do it for today's episode.

I hope you enjoyed my interview with Scott Walter, author of Arabella, the Dark Money Network of Leftist Billionaires Secretly Transforming America. If you haven't gotten a chance, be sure to check out our evening show right here in the podcast feed, where we bring you the top news of the day. Also, make sure to subscribe to the daily signal wherever you get your podcast, and help us reach more listeners by leaving a five-star rating and review. We read all your feedback. Thanks again for listening.

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