From former NASA astronaut Mark Kelly, who is making a bid for the U.S. Senate, to presidential candidate Elizabeth Warren, the refrain du jour among 2020 Democratic presidential candidates seems to be a pledge to swear off donations from corporate political action committees (PACs). It’s a good sound bite to drop on the campaign trail: rejecting corporate and special interest money. But does it really matter on paper?
Steven Billet, who oversees a master’s program in legislative affairs at George Washington University, says candidates who refuse corporate PAC money are basically “giving the sleeves out of their vest.”
“They are giving up nothing because they wouldn’t have gotten much corporate PAC money,” Billet tells Fortune.
A corporate PAC, a type of PAC that raises money in the name of a company, can contribute up to $5,000 to a candidate’s campaign per election. To put this in perspective, an individual donor can donate up to $2,800 of personal money, and a couple can give up to $5,600. So, if a candidate refuses $5,000 from a corporate PAC, they could potentially get the same amount from a private donor.
“Corporate PAC contributions are not a big piece of the pie for major candidates,” says Andrew Mayersohn, a researcher at the Center for Responsive Politics. “There just aren’t enough corporate PACs out there to fund much of an eight-figure senate campaign, let alone a presidential campaign.”
And, according to Mayersohn, corporate PACs specifically “aren’t particularly ideological,” so they tend to give money to incumbents, rather than candidates in open primaries.
“Most corporate PACs don’t make direct contributions to presidential candidates,” he says, “especially when there’s a primary where you don’t know what the outcome will be.”
And even when corporate PACs do give money to a candidate, the sum pales in comparison to other contributions. In the 2016 presidential election, for example, Hillary Clinton raised around $250,000 from corporate PACs—constituting less than 0.5% of the total money she raised, data analyst Brendan Glavin told Marketplace. That number was even smaller for then-candidate Donald Trump: $26,000 or 0.01% of his total fundraising.
Finding the Loopholes
While corporate PACs might not donate money to a specific candidate who doesn’t want them, they can still donate to a political party. A candidate like Warren could reject the corporate and special interest money, but that doesn’t mean the Democratic Party as a whole will do the same. Money that comes through the party could end up being used to support an individual candidate or to sponsor political events.
But perhaps the easiest workaround is that people who work for corporations can donate on an individual basis, money that many candidates gladly continue to accept. In some cases, candidates may even seek out money from a company’s executives on an individual basis.
Michael Williams, founder of the public policy and communications consulting firm The Williams Group, calls it a “sick irony” that candidates will turn away lobbyist or corporate PAC money, while continuing to accept money from executives at the same companies.
“What’s the difference? If you won’t take a particular bank’s money, but you’ll take the bank executive’s money?” Williams tells Fortune. “Are you really materially changing anything?”
Williams says doing so only perpetuates the myth that money influences policy. If a candidate is completely opposed to an industry, he says, those corporations won’t give them money because they don’t expect money to change a candidate’s position.
“I don’t know anyone who was a ‘no’ on something until they got a contribution and then became a ‘yes,’” he says.
And these private donations tend to add up much more quickly than those from a corporate PAC. Unlike individual contribution limits, which have grown over time, corporate PACs continue to face the $5,000 per candidate donation limit—a figure that hasn’t changed since 1974. As such, the total contributions from individuals have skyrocketed as compared to those from PACs.
According to 2017-18 data from OpenSecrets, corporate PAC donations to Democrats totaled $149,426,431, while business donations from individuals to Democrats totaled $920,808,050—more than six times the total given by PACs.
FEC data for the 2016 presidential election shows that corporate PAC donations to Democratic presidential candidates totaled $942,116, and independent expenditures for non-political committees totaled $4,582,471.
But not everyone feels rejecting corporate PAC money is misguided. At the very least, the move could be an effective branding strategy.
Brad Smith, a former FEC commissioner and the current chairman of the Institute for Free Speech, a nonprofit that advocates for loosening campaign-finance regulations, calls swearing off corporate PAC money “not meaningless, but a calculation,” and says the advantage of doing so could outweigh the loss of PAC money.
“It might even get them a net increase in contributions if it persuades more individuals to give,” Smith tells Fortune.
What about super PACs?
While not all of the Democratic candidates are aligned in this respect, many of the expected frontrunners—including Bernie Sanders, Kamala Harris, and Elizabeth Warren—have disavowed super PACs. But this is tricky in practice.
Super PACs have only been around since 2010, but unlike other PACs, they can accept unlimited contributions from any non-foreign source and can spend unlimited amounts to influence an election—meaning that their potential power is also limitless.
Yet super PACs are intended to operate independently from a candidate: they are legally prohibited from contributing directly to a candidate or party, meaning that their funds are usually used to run ads for or against particular candidates and issues. As a result, a candidate can say that they don’t support a super PAC operating on their behalf, but in practice, there isn’t all that much they can do to stop it.
“Any candidate who swears he won’t accept super PAC money is either ignorant, or assumes the listener is ignorant,” says Smith. “A candidate cannot ‘refuse’ super PAC support. He can publicly ask a super PAC not to spend in his race, but the super PAC can choose to ignore the plea and spend whatever it wants.”
Such a claim, therefore, amounts to “grandstanding,” he says.
In addition to swearing off super PACs, some candidates—like Julian Castro, Tulsi Gabbard, Beto O’Rourke, and Elizabeth Warren—have sworn off PAC money entirely, meaning they won’t accept money from labor or ideological PACs, either. Gabbard, O’Rourke, and Warren are also joined by Cory Booker, Kirsten Gillibrand, Kamala Harris, and Amy Klobuchar in a pledge to refuse money from lobbyists.
But the pledge that might matter more than the others, according to Mayersohn, is Warren’s. Going a step further than the rest of the crowd, Warren told supporters in a February email that she would not attend high-dollar fundraisers, dinners, or cocktail receptions with donors, in order to provide “equal access.”
Looks like 2020 might become the small dollar donation election, after all.