Facts About PACs Podcast
The Facts About PACs Podcast is the #1 PAC podcast in America. The show is produced especially for the members of the National Association of Business Political Action Committees (NABPAC). Each weekly episode includes a recap of the association's latest activities, actionable intelligence for the employee-funded and business trade association PAC community, and an interview with a featured guest. Show host Micaela Isler is the President and CEO of NAPBAC.
Facts About PACs Podcast
Ep 53 Political Science for PAC Managers
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What does the latest political science research tell us about the future of employee-funded and trade association PACs? Amie Adams, President of Dunn Associates, and David Schild, Founder and Managing Partner of Three Rivers Strategies join host Adam Belmar for a bonus episode with Princeton University Political Science Professor Zhao Li.
You can join the fight to defend employee funded and association PACs by texting NABPAC to 52886. Message and data rates may apply. Welcome back to the Facts About PACs podcast. I'm Adam Belmar sitting in again this week for Mikhail Isler. Today we're going to take the opportunity to think about the changes that have impacted the employee-funded and business trade association PAC space over the last 11 years. Why 11? Well, the meteor that hit in 2010 in the form of the Supreme Court decision in Citizens United versus the Federal Election Commission was seen at the time as a possible extinction level event for regular citizens in the world of campaign finance. Well, 11 years later, it is clear that those predictions of catastrophe missed the mark. Joining me once again, this time to dig into the political science and political realities of the American campaign finance system, our notable NAB packers Amy Adams and David Schild. Thanks for being my podcast buddies again this week, you two.
SPEAKER_04Buddies, that seems awful presumptuous, Adam.
SPEAKER_01I don't usually get invited back to these shows, so this is a real treat. Well, it's a first for all of us. Just two short episodes ago, everybody, here on the number one pack podcast in America, we took a deep dive with a political science researcher from Princeton University, Dr. Zhao Li. Episode 50 was part of our continuing exploration of the scholarship regarding American campaign finance, a distinctly differed vantage point on our industry from the position of employee-funded and business trade association PAC managers. Michaela and I had the opportunity to hear what the data is telling political scientists about the trends in PAC fundraising and the growing tensions that exist there. If you haven't heard episode 50 yet, you want to hit play on that one after you finish listening to this episode. Today, in our follow-up, you'll hear more from Dr. Lee about where her research is going next and how we can make use of those learnings right now. But before we jump in, Amy and David, let's get a word in here from Michaela Isler.
SPEAKER_00The Facts About PACs podcast is produced especially for the members of the National Association of Business Political Action Committees. In every episode, we recap this week's NAP activities, share actionable intelligence and best practices, all while connecting the PAC community. And today's episode is brought to you by Chain Bridge Bank, looking for a financial partner who actually understands PACs and the frustration by crossing the bridge to better banking with Chainbridge Bank, a group who specializes in the financial needs of the corporate and association PAC space. Chainbridge Bank, they know PACs.
SPEAKER_01Thanks, Michaela. Amy Adams and David Schild, when Super PACs came on the scene, the prognosticators said corporate money would flood the zone and swamp individual donors. That did not happen. Here is how Dr. Lee from Princeton describes the true implications of Citizens United.
SPEAKER_03It's really interesting how the observed records post-Citizens United don't really match up with the kind of concerns that were being voiced in the public prior to the ruling. So we did not see a flood of corporate money in politics through the independent expenditures channel, at least not the ones that we could observe. So, for example, in some of the political science publications I've read, I've seen numbers such as in 2012, the first elections cycle fully after Citizens United, less than 1% of Super PAC money came from corporate treasury accounts. The super PACs are unlimited independent expenditure vehicles, but they have to disclose their sources. So as far as money that is ultimately being disclosed, there's very little evidence that corporations are directly involved. Now, so-called dark money organizations that just five One C4s are a different matter because almost by definition, their funding is difficult to trace. And certainly I wouldn't be able to put a number on how much or how little of their money comes from corporations. But nonetheless, as far as the data shows, it does not accord with the kind of public concerns that were being voiced prior to Citizens United. And I think political scientists have speculated why. There's this initial reaction that this is because of consumer pressure, that companies don't want to be seen certainly not through Super Pact supporting the election or defeat of certain candidates because they're worried about backlash from consumers who might be politically conscientious in their purchases. But I think that's certainly a part of the story. But I think my research and others' research shows that the corporations are also cognizant of potential backlash from other stakeholders, including not only shareholders, some of which are politically active, but also employees. Even for independent expenditures where employees do not directly participate in the fundraising process because it doesn't come from employees per se, they may still have an interest and indeed the ability to really keep tacks on what their companies are doing as far as political involvement goes. And if they disagree with, let's say, a company's independent expenditures, that can spill over into business activities in an undesirable manner that could potentially decrease employee morale or productivity or expedite employee turnovers. So I think there are lots of stakeholder approaches, along with executives and public affair experts' own judgment that deters most corporations from actually participating in the independent expenditure process.
SPEAKER_01David, research is downstream of events, but you and Amy and many of those listening lived through everything that happened in real time as practitioners. How do you see the current state of play for business PACs in the age of super PACs?
SPEAKER_02You know, I think that uh the Citizens United decision was unquestionably very impactful on the way that we run campaigns in this country, right? Um, the door was opened just to a flood of money that wasn't sort of on the playing field beforehand. But sitting inside a corporate or association political action committee, uh, I'm not sure that it was really a game-changing decision other than the perception that your employees have of money in politics, right? As a utilitarian device, uh separate segregated fund allows you to manage with a modest, you know, overhead outlay contributions to candidates that hopefully a board thoughtfully selects. What is the use in running millions of dollars of TV ads if you're a corporation or a trade association? That doesn't really fit with the sort of moderate, you know, center left, center right approach that I think most corporate PACs are taking. But as I said, what it really does is it changes the way that your restricted class perceives money in politics. I think people feel like, well, my employees, my association members, they're very sophisticated. They understand money in politics, they're following the Supreme Court. No, they have the same level of political sophistication as the average American. So when something like Citizens United comes along and really starts to skew, I think because of coverage that's pretty adversarial, the role of money in politics, that filters down. That is distilled into your restricted class. And so all of a sudden, people you've been talking to for months or years are getting a flood of information about money in politics. Maybe it's not accurate, maybe it really sort of turns their opinion against money in politics. That's your restricted class. That's the audience you have to go see. So I think that was the most immediate effect for corporate and association PAC managers was just sort of changing the tone of discussion. And that's the environment that we operate in as fundraisers.
SPEAKER_04Just the term super PAC that evolved out of that decision has done more to make educating people about political engagement so difficult because there's this perception that they are the same as what corporations and labor unions and other interest groups are doing with their own political action committees. I spend quite a bit of time training PAC champions, executives, pack board members about political engagement and the realities of it and political action committees. And I can't tell you how many times I have to go back to basics and start over with our PAC is not a super PAC. This is the difference. This is what Citizens United means. It doesn't mean that corporations can just go spend all kinds of money from their own treasury. All of the laws that put political action committees into place still remain, and this is not happening at all.
SPEAKER_02Amy's exactly right. And I can't tell you how many times I've had to say to really learned executives, we do not operate a super PAC. The vast majority of the Fortune 500 do not operate super PACs. That's the reality. I don't think it's what you would get from watching mainstream media coverage of money in politics.
SPEAKER_04I should also say, too, that if you haven't done an article or included in any of your presentations, and here I'm talking to PAC directors lately, where you uh show the difference or explain the difference between a super PAC and your PAC or let people know that your PAC is not a super PAC, you need to do so. And you need to do so on a regular basis. I think we think we've done that education. We think we told everybody once and that they understood and they heard it. And yet, as David said, that's not what people are hearing on TV, it's not what they're hearing on the radio. And we need to continually do the education to remind people because when we do the survey work with eligibles, they continue to misunderstand the definitions.
SPEAKER_01These are great points, all. And I go back to something that Dr. Lee said. When there's disagreement over a company's independent expenditures, it can really spill over into business activities in an undesired manner. Look, employee-funded PACs know well where the money is going and who is giving it. But when the company is spending treasury funds going into a super PAC, well, that muddies the waters. It's very misunderstood, but quite honestly, it's something that doesn't happen near at all for this very reason that David and the doctor point out, it is not a helpful on-brand play for these companies.
SPEAKER_04Adam, we do every cycle, we do a survey of corporate packs that are raising a million dollars or more per cycle. And when we ask about the amount that they're doing in independent expenditures, there is maybe one out of all of the more than 100 packs that are part of this group who actually are taking part in independent expenditures. So the numbers are much smaller than, again, what anyone perceived. There's a, and Dr. Lee said something about this in her comments. There's a stakeholder issue at play here. We've seen this quite a bit. There was a lot of conversations, especially in light of January 6th, about various stakeholders, not just employees, but shareholders who are members of organizations who are really starting to look at where the political contributions of an organization are going. And it's just not what folks think it is. It's being portrayed in a totally different way.
SPEAKER_02It's hard for me to imagine a scenario where you would be sitting with your uh PAC board, your PAC contribution committee, discussing the members of Congress, the candidates with whom you want to engage, running down their views, using a set of specific criteria, and all of a sudden feeling like, hey, let's go make a six or seven-figure independent expenditure. Let's put our name on something and let's go public. That's just such the nuclear option for a corporate or trade association pack, right? Which is sort of swimming along in an environment where hundreds of other SSFs are operating. And now you really want to have this sort of outsized and very public impact. The risk is tremendous. And I can't see uh what the advantages are for most organizations.
SPEAKER_04Yeah, you know, um, there were examples of this, and I would say it's probably going back about 10 years now, where there were companies who were getting involved, especially in state issues and in state races where they were able to use corporate money. And what we did see in the research that we did with their PAC eligibles afterwards is that the employees did not discern between what the company was doing with corporate funds and what the company was doing through their PAC. And frankly, a lot of those companies learned a big lesson.
SPEAKER_01Well, in 2021, as we continue to recover from the attacks on the capital on the 6th of January, lessons learned have been order of the day across the industry. And we've talked a great deal on this podcast, Amy, about the importance of two-way conversations that pack managers engage in with their restricted class. But answering tough questions is something that benefits all of us. And that's why we have put in the time to speak with scholars. As you'll hear in this clip from Professor Lee, the value in these conversations between practitioners and scholars is on both sides.
SPEAKER_03Personally, to me, it's incredibly important because we as researchers don't always have a front row seat to a lot of the day-to-day activities of corporate PACs or other domains of corporate political activities. So as much as we can deduce things from data or from other means of observations, it's also really important for us as researchers to hear from practitioners, from policymakers, and other members of the public about what things look like on the ground on a day-to-day basis. And that's great for our work. And I think sometimes, hopefully, we can also produce a research that will benefit people in the real world. So I really welcome this opportunity to speak with you, Adam, on this podcast. And I look forward to any responses that your audience might have to our conversation today.
SPEAKER_02So, Adam, I you know, I love this because I'm a campaign finance nerd and I would love to live in this universe where pack directors are consuming massive amounts of academic data. I don't think, unfortunately, that's the reality, right? Uh I'll give a shameless plug here for NAPPAC, which I think is a great source of professional development for the Graduate School of Political Management at GW, where you can really immerse yourself in this kind of data and information. But, you know, having sat in that corporate PAC director chair, I can tell you that people are uh consuming large amounts of news. I don't know that there is as much of focus on the academic data that's out there. I'm biased. I think you should absolutely be somebody who is a student of campaign finance and campaigns and elections if you're in this job. I just don't know that the reality reflects uh people consuming this data like we'd like them to.
SPEAKER_01Yeah, I think that's exactly right. And that's one of the reasons that we're really taking it on here at Facts About PACs. We are doing the work so you don't have to and bringing you the learnings and talking to people across the spectrum. This isn't about political ideology. It's about data, it's about understanding trends. And Amy Adams, you sit in a place that's far removed from Professor Lee. You're seeing these things happen and understanding them in a way that researchers really can't. But I assume that you appreciate this research even that much more because of that.
SPEAKER_04Oh, absolutely. And honestly, I would love to talk to Dr. Lee personally, because I do think the conversations are so important. We we talk about how important they are in every aspect of the work we do. You know, when we when people tell us they don't want to join the pack, we say to them, please tell us more. It also helps too, I think, when I'm hearing a researcher like that, to be able to back up and say, oh yeah, okay, what are they finding? What am I seeing? You know, is what I'm seeing anecdotal versus versus a real trend. And there's some sort of gut check that's happening, but also some sort of, okay, these may be the trends that I should be watching. And I want to make sure that I'm keeping them in the back of my head.
SPEAKER_02There's an idea here, Adam, that this discussion really reinforces. And that is pack directors should be the source of political education for their members and potential members. I think sometimes there's a focus on, I need to tell my restricted class how our political action committee works and what it's going to do for them. But more broadly, you have to think of, as we've talked about earlier on this podcast, the members of your restricted class as part of this vast ocean of folks who are consuming from sources trusted and quite frankly, not information about money and politics. And if you're producing any sort of regular communication, you can get people the right information, the facts about this is what this court decision meant. This is how many companies are actually playing in this space. You should be the first voice people think of when it comes to their general political education within your organization.
SPEAKER_04And frankly, there are no other people doing this. This goes back to the podcast we did last week about your professional development opportunities. If you are the voice and you have done this research, you can be providing your executives with a way of thinking about things that they don't have the time to go look for.
SPEAKER_01Amy Adams, you just a few minutes ago talked about lessons learned, ones that you saw transpiring at a state level. Really, it's about confidence. Uh, David just used the word. Our government relations teams are nothing. If they don't have the confidence of their partners on the other side, and that means our regulators and our lawmakers, they want to know that they're getting truly accurate, consistent information that is backed up by data. And that is exactly the kind of confidence we have to instill in the restrictive class that we're not playing games. We're not telling you exactly how you need to do anything. We're saying our enterprise is focused on these core issues. We are working hard to inform all of our people about how to get involved in the process and making meaningful relationships happen with lawmakers who are leaders in our space. And all of that really depends on credibility.
SPEAKER_04And there's nothing that provides you with better credibility than being able to refer to academic studies. I mean, I like I watch people's faces when I say, well, what the research tells us is, and all of a sudden you have, they're gonna believe everything that comes out of your mouth.
SPEAKER_02Here's the challenge I think to our listeners. If you're sitting behind a desk running a political action committee today, how do you answer the following question? Are you the most trusted source of political information inside your organization? And if not, what do you need to do to get to that point?
SPEAKER_01Yeah, David, you you couldn't be more right. You know, in our conversation last week, the three of us, Amy Adams, you said something that really stuck with me. You said if you're a pack manager, you're a tough cookie. You're someone who knows full well that you're in a job that will draw criticism from all sides. And some of that can be chalked up to the realization that you can't make everybody happy at the same time. But for her part, Dr. Lee sees even deeper tensions growing.
SPEAKER_03Aaron Ross Powell, we touched on digital fundraising platforms, and that reminds me that I do wonder, and this is my conjecture, I don't have my research to back it up, how employees and other individuals, as they interact with these fundraising platforms and other means of direct solicitation from candidates, color their opinion about the PAC fundraising process because there is anecdotal and some research evidence that the ways in which campaigns and other organizations solicit donations increasingly focused on sort of emotionally charged messaging. Yeah, and often appeal to say polarizing issues or political figures and some of the light in terms of messaging on concrete policy uh discussions. So I think it really has the potential, at least to give it the attention away from the kind of policy or relationship building work that many business packs do and focus people's attention on content that's potentially divisive, that's controversial, that generate collects, that generate uh donations. So I do wonder, first of all, I agree that on average, I would say business packs are more of a moderating force than many individual donors that we have in this country. And I also wonder if this dynamic is going to become more pronounced as we see an increase in individual donors, particularly small donors, through these digital platforms.
SPEAKER_04You know, Adam, I thought it was very interesting how Dr. Lee brought in this information about the polarizing messages being so popular in political fundraising, because honestly, it is the absolute opposite of what we try to do when we are talking about our political action committee and our political engagement efforts on behalf of an association or a corporation. Corporations and associations are a moderating force in politics, not a divisive force in politics. They support candidates on both sides of the aisle fairly evenly. If you really look at the giving, typically it's weighted a little bit heavier on one side or the other, depending on which party is in the majority. That said, associations and corporations are not in the business of politics because they like politics. They're in the business of politics because politics is in their business. And they are there to develop relationships, to be able to do the education so that lawmakers can have the proper information to make good decisions about public policy.
SPEAKER_02Amy is exactly right. If you can look at the last 10, 15 years and you can just see this widening divide between the way the digital fundraising community has essentially weaponized trolling and clickbait headlines to find money on the far fringes of the political spectrum and the way that the business and association community has sort of steered a center path that says, we are divided on the most incendiary issues of the day. And I would say this to a pack director if you're out there wondering like, where does my workforce fall on the most contentious social issues? Guess what? They're probably Like the American populace is split. So do not address those items. They're not part of the mission of your organization. They're going to divide your audience. I think the task of keeping your language much more aspirational, much more positive. You're swimming against the current on that, for sure, right now. But you have to do it. You have to talk about what brings us together as an organization, not what divides us.
SPEAKER_01Yeah, back in episode 51, when Mikhaila and I were first going through this great interview with uh Jali from Princeton, we struggled to better understand this tension of reconciling a personal and now very engaged solicitable class who have all these easy turnkey options to get involved in the political process. And that's running right alongside their activation in the employer association pack. And they're suddenly maybe saying one or the other and not both. But we're finding that there is space for both. But we hear a lot about sustainability. If you're running a pack, it is a sustainable enterprise. Your trustworthiness, your inherent value to the organization and the people that you serve, the employees who are voluntarily contributing and making this a part of our government relations effort have to be respected, start to finish every cycle. And sustainability means not doing the things that David has pointed to on the digital side, where it's pure clickbait and there is nothing but alarmism and emotionality, and it leaves concrete policy discussions and core values sitting on the sidelines, which is not where they ought to be, Amy.
SPEAKER_04Yeah, and I and I think you're right, Adam. And while I say we don't want to talk about things that are divisive and we don't talk about things, we don't talk about them in a divisive nature. We're not trying to get clicks, but that doesn't mean we're not talking about the issues. And I think that's the difference is public policy issues. There is no one party that is going to solve everything. It takes people working across the aisle, as we all know, and any of us who've worked in politics at any time for any length of time know that it takes people working across the aisle to actually get legislation passed. And that is what the business community PACs are interested in doing is helping to move that process along.
SPEAKER_02I think if you were to poll advocacy professionals in Washington, they would say that hard right or hard left turns are deleterious to the business community in the long run. That bipartisanship and the ability to form coalitions is what has given the business association community the greatest wins over the years. So, and this is a phrase I keep coming back to. If you see yourself as a good steward of the dollars you have been entrusted with, then you should not be taking unrelated issues and driving the political process hard to the left or hard to the right with those employee dollars.
SPEAKER_01Amy Adams, president of Dunn Associates and the Voice of Wisdom on the other end of the NABPAC help hotline, and David SHILD, founder and managing director of Three Rivers Strategies. Thank you both again for helping me carry the Facts About PAX Torch while Michaela Isler gets some much deserved time off. And everybody downloading and sharing the Facts About PAX podcast, your support has made us the number one PAC podcast in America. Thank you. NABPAC is dedicated to defending the record of employee funded and business trade association PAX and championing the amazing PAC professionals who lead vital teams. Subscribe, meet us right back here for another Facts About PAX podcast.
