Outside Groups: Impact and Tax Status

At The New York Times, Thomas Edsall writes:

Douglas Schoen, a Democratic consultant who is not part of the Obama campaign and has been very critical of the president, wrote in an email that

it is a huge, and potentially dispositive disadvantage that Obama is not raising super PAC money. I expect Romney to have $400-500 million to spend in what will ultimately prove to be 5-8 crucial swing states.

In addition to the financial advantages, Schoen wrote, Republican super PACs

can and will run ads without disclosure or with any real review of their accuracy. So Romney can and will insulate himself from the most noxious and offensive and probably inaccurate ads as well — as he did in the primaries.

The second Schoen comment is not quite accurate.  Unlike 501(c)(4) groups, super PACs do indeed disclose their contributors to the FEC.  And blogs, advocacy groups, and news organizations are quick to point out inaccuracies in ads.   For instance, PolitiFact recently noted a dubious statistic (85 percent of recent college grads purportedly moving back with their parents) in an American Crossroads ad.

TPM reports:

Democrats say super PACs are necessary for them to stay competitive in races that were hit by an influx of super PAC money in 2010.

“The pitch is that we are the firewall against outside Republican money,” Andy Stone of House Majority PAC, a Democratic super PAC, told TPM. “We all know what happened last cycle, in so many close races where Republican outside groups came in at the last minute, dumped a whole much of money and ended up winning the race. We’re here to make sure that doesn’t happen this cycle.”

Allison said that super PAC money can often benefit challengers most.

“The problem that every challenger has is name recognition. What super PACs are able to do is drive up the negatives of their opponent while creating a warm, fuzzy image of their candidate,” Allison said. “It’s a huge equalizer for challengers I think.”

Dan Froomkin and Paul Blumenthal writes at The Huffington Post:

Crossroads Grassroots Policy Strategies, the political ad-buying organization cofounded by Republican strategist Karl Rove in 2010, has officially submitted its first tax forms with the Internal Revenue Service, and as expected, the group is formally requesting that the IRS treat it as a nonprofit operating under section 501(c)(4) of the tax code.

But that's a tricky proposition for a group that spends the vast majority of its money on ads decrying one political candidate or another.

The hitch is that the tax code says 501(c)(4) groups "must be operated exclusively to promote social welfare" -- the promotion of which "does not include direct or indirect participation or intervention in political campaigns on behalf of or in opposition to any candidate for public office."