Powerful Tea Party Group's Internal Docs Leak—Read Them HereSubmitted by JAVA on Sat, 01/05/2013 - 10:19
FreedomWorks bills itself as a grassroots outfit, but it's bankrolled mostly by big-money donors.
FreedomWorks, the national conservative group that helped launch the tea party movement, sells itself as a genuine grassroots operation, and for years it has battled accusations of "astroturfing"—posing as a populist organization while doing the bidding of big-money donors. Yet internal documents obtained by Mother Jones show that FreedomWorks has indeed become dependent on wealthy individual donors to finance its growing operation.
Last month, the Washington Post reported that Richard Stephenson, a reclusive millionaire banker and FreedomWorks board member, and members of his family funneled $12 million in October through two newly created Tennessee corporations to FreedomWorks' super-PAC, which used these funds to support tea party candidates in November's elections. The revelation that a corporate bigwig like Stephenson, who founded the Cancer Treatment Centers of America and chairs its board, was responsible for more than half of the FreedomWorks super-PAC's haul in 2012 undercuts the group's grassroots image and hands ammunition to critics who say FreedomWorks does the bidding of rich conservative donors.
Big donations like Stephenson's are business as usual for FreedomWorks. According to a 52-page report prepared by FreedomWorks' top brass for a board of directors meeting held in mid-December at the Virginia office of Sands Capital Management, an investment firm run by FreedomWorks board member Frank Sands, the entire FreedomWorks organization—its 501(c)(3) and (c)(4) nonprofit arms and its super-PAC—raised nearly $41 million through mid-December. Of that total, $33 million—or 81 percent of its 2012 fundraising—came in the form of "major gifts," the type of big donations coveted by nonprofits and super-PACs. (FreedomWorks' nonprofit components do not have to disclose their funders.)
Well-heeled individual contributors ponied up $31 million—or 94 percent—of those major gifts, according to the FreedomWorks board book. Eight donors gave a half-million dollars or more; 22 donated between $100,000 and $499,999; 17 cut checks between $50,000 and $99,999; and 95 gave between $10,000 and $49,999. Foundations contributed $1.6 million in major gifts, and corporations donated $330,000. Corporations once accounted for more of FreedomWorks' hefty donations. In a memo included in the report, David Kirby, FreedomWork's vice president for development, and senior adviser Terry Kibbe wrote, "This year continued our trend of relying less and less on corporate support." At the same time FreedomWorks expanded its small donor ranks from 41,794 in 2011 to 81,081 in 2012. More than 30,000 of those small donors gave between a dollar and $99 this year.
According to ex-FreedomWorks chairman Dick Armey, when he joined the organization in 2003, FreedomWorks relied heavily on corporate donations. The group, he says, subsequently weaned itself off such underwriting and used direct-mail lists—some provided by Armey—to build up a base of small donors. But in the last year, there was a "big surge in private individual contributions," most of which Armey says he didn't know about. "The details were kept secret from me," he remarks.
FreedomWorks, flush with wealthy donors' money, took full advantage of the nation's lax campaign finance rules during the 2012 election cycle. The group's nonprofit side shifted millions of dollars in dark money to the FreedomWorks super-PAC, effectively hiding the true source of those funds. One campaign finance reform advocate blasted those internal money transfers as the "laundering of secret money." A FreedomWorks spokeswoman did not respond to requests for comment.
FreedomWorks president and CEO Matt Kibbe acknowledged that his group's plan to help flip control of the US Senate to the GOP failed miserably ("We take our lumps with humility"), and he insisted that it's time to replace the aging image of the conservative movement with "younger, more diverse, more substantive voices for freedom in America." Kibbe asked: "Can liberty, personal responsibility, and doing things for yourself be the new 'cool'?"
Such a makeover, Kibbe wrote, can begin if FreedomWorks courts so-called "Ron Paul Millennials," the loud, loyal twentysomethings who in 2008 and 2012 followed the GOP libertarian presidential candidate from one stump speech to the next. Kibbe noted that FreedomWorks plans to reach out to blacks and Hispanics with a new "Black and Brown" tour, starring a Brazilian immigrant and tea party activist named Ana Puig. And he touted FreedomWorks' growing online presence, with 2.1 million members on its email list and 4 million Facebook fans.
This may be old news for some, but well worth this reminder... Let the "buyer" beware, lest we experience even more "buyers' remorse".