Like many political candidates, Dean Phillips spends hours each day fundraising and thanking his donors. But because he refuses to accept PAC money from corporations, unions or other politicians, he has adopted a unique approach.
“Norbert?” he asked on the doorstep of a man who’d donated $25 to his campaign. “I’m here with goodies!”
Phillips, who is running for Congress in the suburbs of Minneapolis, handed over a gift bag containing a T-shirt and bumper sticker. The exchange was recorded in a video that was shared later with his supporters to encourage them to contribute as well. Norbert Gernes, an 80-year-old retiree, was impressed.
“We desperately need to get the money out of the political system,” he said in an interview afterward. “Because I don’t think we have a Congress that’s representing the people any more.”
Campaign finance was once famously dismissed by Sen. Mitch McConnell, R-Ky., the majority leader, as being of no greater concern to American voters than “static cling.” But since the Supreme Court’s Citizens United decision in 2010 opened the floodgates for unrestricted political spending, polls have shown that voters are growing increasingly bitter about the role of money in politics.
The issue is now emerging in midterm races around the country, with dozens of Democrats rejecting donations from political action committees that are sponsored by corporations or industry groups. A handful of candidates, including Phillips, are going a step further and refusing to take any PAC money at all, even if it comes from labor unions or fellow Democrats.
Rather than dooming the campaigns, these pledges to reject PAC money have become central selling points for voters. And for some of the candidates, the small-donor donations are adding up.
In Minnesota, Phillips, a Democrat, has raised more than $2.3 million, 99 percent of it from individuals, and has used his no-PAC-money pledge to mount a formidable challenge in a district that Republicans have held since 1961. His opponent, Rep. Erik Paulsen, who sits on the powerful House Ways and Means Committee, has raised $3.6 million, more than half it from PACs.
In Texas, Rep. Beto O’Rourke, a Democrat running to unseat Sen. Ted Cruz, has raised more than $23 million in this election cycle — considerably more than Cruz — without accepting any PAC money.
“It’s a major theme of the campaign,” said Chris Evans, O’Rourke’s communications director. “People want to know that you are going to respond to them and their interests, and not the most recent check you received.”
In Pennsylvania, Conor Lamb, a Democrat who pledged not to take corporate PAC money, eked out a victory in a special election in March in a district that President Donald Trump won by 20 points in 2016. In Ohio, another Democrat running in a red district, Daniel O’Connor, made the same pledge, and performed so well in a special election this month that the race is still too close to call.
A recent Pew report found that 75 percent of the public said “there should be limits on the amount of money individuals and organizations” can spend on political campaigns.
“Poll after poll is showing that money in politics has more traction today than it has had in my life time,” said Meredith McGehee, executive director of Issue One, a nonpartisan advocacy group concerned with ethics and accountability, who has been working on the campaign finance issue for decades.
Under current federal rules, a candidate’s campaign cannot accept more than $2,700 from any individual donor or $5,000 from any single PAC. Groups known as Super PACs, however, can legally receive and spend unlimited amounts to influence a race, as long as they do not coordinate their activity directly with a candidate’s campaign.
Frustration with corporate influence in politics was evident during the 2016 presidential cycle. Sen. Bernie Sanders of Vermont, who sought the Democratic nomination, rejected corporate PAC money, excelled at attracting small-dollar donations, and criticized the political establishment in Washington for being too beholden to the wealthy.
Trump also made corruption in Washington a central theme of his campaign and promised to “drain the swamp” of politicians who only do the bidding of their wealthy donors.
“Love or hate Trump, I think the moment he stood on stage and said ‘Give politicians money and they’ll do whatever you want,’ was the beginning of his upward trajectory,” said John Pudner of Take Back Our Republic, a conservative group dedicated to reducing the political influence of corporations, unions and other special interest groups.
Rep. Ken Buck, R-Colo., wrote a book last year called “Drain the Swamp: How Washington Corruption is Worse Than You Think,” detailing the way powerful posts are doled out to those who raise the most campaign money, not necessarily those with the best ideas. The cycle perpetuates itself, he wrote, as members of Congress who serve on powerful committees attract more donations for their re-election campaigns.
But Republican leaders have not taken up the issue. And Trump routinely endorses candidates who accept large amounts of money from corporate PACs. In the recent special election in Ohio, Trump attended a rally for O’Connor’s Republican opponent, Troy Balderson, a state senator who heads an energy committee and has received more than one-third of his campaign funds from PACs, including some with ties to oil and gas companies.
Democrats in Congress also routinely give leadership posts to top fundraisers. But an increasing number of rising stars in the party have sworn off corporate PAC money including Sens. Cory Booker of New Jersey, Kamala Harris of California and Kirsten Gillibrand of New York.
In 2016, only three of the 41 candidates on the Democratic Congressional Campaign Committee’s “red-to-blue” list of the most competitive races made the no-corporate-PAC pledge, according to Adam Bozzi, communications director at End Citizens United, a group that supports an overhaul of campaign finance laws. By contrast, 32 of the 59 candidates on the list this year are shunning corporate PACs.
Candidates can do this in part because of a sharp rise in giving by small donors.
In the last midterm election year, 2014, some 1.5 million small donors contributed a total of $335 million to Democratic campaigns across the country through ActBlue, an online platform that raises money for Democrats. This time around, about 3.8 million small donors have contributed more than $1 billion, and are on a pace to exceed $1.5 billion before Election Day in November, according to Erin Hill, ActBlue’s Executive director. The average donation is $33.85.
That’s good news for Phillips in Minnesota, who has staked his candidacy on the proposition that voters care about who he takes money from.
On the campaign trail, he ties nearly every issue back to campaign finance. When people complain to him about the high cost of drugs or health care, he tells them that corporate influence is to blame.
“Can anybody guess how much the big pharma industry spent on lobbying last year?” he asked a group of small business owners at a round-table discussion. “Take a guess.”
He answered his own question. “Two hundred and forty million,” he said, adding: “They all but pooh-poohed any legislation that would allow Medicare to negotiate prescription drug prices.”
His message is particularly potent because his opponent, Paulsen, has taken in the sixth-largest haul from PACs out of the 435 members of the House of Representatives, according to the Center for Responsive Politics.
Paulsen was under fire even before Phillips entered the race, because of his record of voting in lock step with Trump. His district, the 3rd, has sent Republicans to Congress for six decades, but its voters chose Hillary Clinton for president.
Phillips is an unlikely messenger for warnings about the corrupting influence of wealth on politics. He is the heir to a liquor fortune, as the stepson of Edward Phillips, owner of Phillips Distilling Co., which popularized luxury vodka in the United States.
Paulsen’s campaign has tried to make an issue of Phillips’ wealth.
“Dean Phillips is a hypocrite spending his vast inherited wealth on his campaign, which he’s padded with investments in the very things he campaigns against,” said John-Paul Yates, Paulsen’s campaign manager.
According to Federal Election Commission filings, Phillips has contributed less than $6,000 of his own money to the campaign, and given less than $30,000 worth of in-kind donations, including the use of a pontoon boat for campaigning on Lake Minnetonka.
Phillips says his family fortune is what opened his eyes to the way money influences politics, after he began hearing from candidates who were eager to enlist him as a major donor.
“I watched the Hillary Clinton campaign, and recognized that it was so predicated on spending time with wealthy donors and not spending time in middle-class neighborhoods and rural areas,” he said.
Don Kuster, who said he has ticked the box for Paulsen in every previous election, now volunteers for Phillips’ campaign. He drives the pontoon boat and has held a meet-the-candidate party at his home, which was attended by about 60 Republicans.
“I asked him ‘What’s your thing?’ and he said, ‘Campaign finance reform,'” Kuster recalled from his first conversation with Phillips. “He said, ‘I’m not taking any PAC money. I’m not taking it from the Sierra Club. I’m not taking money from Planned Parenthood. I want to be able to make my own decisions.’ I thought, ‘Ok, that’s something I can support.'”
Laurie Wolfe, a college professor from Maple Grove, Minnesota, said Phillips’ no-PAC pledge has bipartisan appeal.
Wolfe is a co-chairwoman of the local chapter of Indivisible, a grass-roots network that opposes Trump’s policies, but her two brothers support Trump. At family gatherings, there is often only one issue they agree on.
“We need to get rid of these politicians who only care about their corporate donors and getting re-elected,” she said. “A lot of people like us find it refreshing to have a candidate that’s going to the people rather than the big donors.”