Two months after President Barack Obama reluctantly embraced fundraising for big-money "Super PACS," many Democratic donors still have not given to such political groups because they are dismayed by how PACs are being used in the presidential campaign.
Billionaire investor George Soros and insurance executive Peter Lewis, who together have donated more than $50 million to Democratic political groups since 2004, are among scores of donors close to the Obama campaign who remain on the sidelines as PACs that can receive unlimited donations seek to load up before the November election. Their reluctance helps explain why Priorities USA Action, the Super PAC that supports Obama, has struggled to keep fundraising pace with rival Republican groups that have already spent tens of millions on the presidential race.
Many of the Democratic donors are alarmed that PACs, or political action committees, have been focused almost exclusively on spending tens of millions of dollars on ads to attack presidential candidates. Nearly all of that spending has been by Republican-backed groups in the bitter race for that party's nomination, most of it by Restore Our Future, a PAC that supports likely Republican nominee Mitt Romney and has overwhelmed rivals Rick Santorum and Newt Gingrich with negative ads.
Obama, who opposed a 2010 Supreme Court decision lifting donation limits on PACs that operate independently from campaigns, was reluctant to embrace such groups. He changed course after seeing the cash being amassed on the Republican side and impact of the pro-Romney group's ads. But many wealthy Democrats who would be potential donors to the pro-Obama PAC, including Lewis, chairman of the insurance giant Progressive Corp., are turned off by the tactics of PACs in the presidential race.
"The Super PACs are nearly all about advertising, and he is loathe to contribute toward that," said Lewis adviser Jennifer Frutchy. "He is not currently planning to contribute to any Super PACs, congressional or presidential." Lewis has contributed $5,000 to Obama's re-election campaign and $30,800 to Obama's joint fund with the Democratic National Committee, the maximum amounts allowed for an individual. He has also given $200,000 to American Bridge, a Super PAC that is largely focused on opposition research, not advertising.
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Soros spokesman Michael Vachon said the financier is "not focused" on this presidential election. Soros plans to donate to Obama and congressional campaigns but is undecided about giving to Super PACs, Vachon said. "Like many people, he's alarmed by the (Supreme Court) decision and the growing role that money is playing in the election," Vachon said.
Last year, Soros gave $100,000 to Majority PAC, which helps Democratic Senate candidates, and $75,000 to House Majority PAC, which focuses on putting Democrats in the House of Representatives. In the 2004 elections, Soros was the biggest donor to the Super PACs' predecessors, so-called "527" groups. The tax-exempt organizations were forbidden from "expressly advocating" for the election or defeat of specific candidates.
Such groups typically focused on registering Americans to vote and encouraging them to turn out for elections, said campaign finance specialist Anthony Corrado, a political science professor at Colby College in Maine. "One of the problems with the Super PAC strategy is that it is largely a vehicle for financing negative advertising, and many donors don't want to invest into that type of activity," Corrado said.
"That individuals who are identified as major donors to progressive causes are reluctant to give to Super PACs is an indication of the challenges that Priorities USA faces in terms of competing with the Super PACs that will oppose them."