But if the dinner party had been in June 2011, Romney would have been stretching the legal bounds of allowed coordination between a candidate and a super PAC. The FEC issued an advisory opinion on the question in July. The timing of Romney’s meeting highlights just how quickly the already ambiguous guidelines on coordination, which regulate the relationship between candidates and super PACs, are changing, and how they stretch the boundaries of campaign finance limits.

On the other side of the organization spectrum, 501(c) nonprofits are accepting unlimited, anonymous donations and funneling them into super PACs, providing complete secrecy to donors. But these nonprofits, too, are buttressed by weak regulation, say critics. Meanwhile, their funding increases as a result of the infamous Citizens United Supreme Court decision.

Candidates can only solicit money from nonprofits if the organization’s “main purpose” is not political activity, according to FEC regulations. If a 501(c) organization exceeds the minimum amount of political activity, it becomes a Qualified Nonprofit Corporation, and can then make political independent expenditures. But as reported by Roll Call last week, a more precise definition than “main purpose” has “never been clearly spelled out.”

The Internal Revenue Service says 501(c) nonprofits can only participate in “insubstantial” amounts of political activity, which Washington insiders have taken to mean social aid work must be 51 percent of the group’s purpose. But that is understood more as a rule of thumb.

This distinction has come under increased scrutiny as nonprofits both receive and give donations in the political realm — including to super PACs.

In 2010, the nonprofit advised by Karl Rove, Crossroads GPS  spent tens of millions of dollars on advertisements for Senate races around the country in 2010. The actions of the nonprofit, which is affiliated with the American Crossroads super PAC, prompted Sen. Dick Durbin and the nonprofit groups Democracy 21 and the Campaign Legal Center to request an IRS review of Crossroads 501(c) status and a clarification of the rules governing nonprofits’ political action. 

Coordination confusion

Federal laws guiding super PAC coordination are equally narrow, say critics; super PACs may be independent groups in name, but the reality tells another story, according to critics, allowing for a large amount of activity outside the legal definition of coordination.

“The critical point is that the [coordination] laws are pretty modest,” said Paul S. Ryan, FEC Program Director and Associate Legal Counsel at the Campaign Legal Center. Candidates and super PACs “can’t coordinate on a specific detail, but it’s false that they can’t interact.”

As far as the FEC is concerned, coordination is defined as: “made in cooperation, consultation or concert with, or at the request or suggestion of, a candidate, a candidate’s authorized committee, or their agents, or a political party committee or its agents.”

The rules allow “a lot of interaction that’s not independent,” said Ryan. “It’s an overstatement and misstatement to say that they [super PACs] have to be independent.”

The rules have created enough head-spinning that comedian Stephen Colbert devoted his show Monday to spoofing them.

A super PAC can support a specific candidate so long as their coordination is within the limits of the three coordination “prongs,” as the FEC calls them.

The first and most widely known is the restriction on coordinated spending. Super PACs are called independent expenditure groups because the decisions about how they spend their money can’t be made with the input of a candidate, though the money can be spent in support of a candidate or an issue that is important to the candidate.

The second is a limitations on public communications that can be made in support of candidates. If the communication is for electioneering purposes, advocates the defeat or victory of a candidate, has the input of a candidate or is disseminated 120 days or fewer before the election, it is considered coordinated.

The third coordination guideline covers solicitation. The candidate is not allowed to solicit or direct any money for super PACs, said Ryan with the Campaign Legal Center but “that restriction is quite modest.”

How does this affect the system?

Coordination limits have been pushed by candidates and super PACs in a number of ways. Even with these limitations, super PACs unlimited donation allowances bring in significantly more funding than traditional PACs, which can only take donations of up to $5,000 in support of candidates. Restore Our Future was created to support Romney, and has so far raised more than $12 million this year. By contrast, Romney’s traditional PAC, Free & Strong America, raised only a little over $3 million in the same time period.

All the same, several groups have submitted advisory opinion requests pertaining to “coordination” to the FEC, and some of the most significant changes in campaign finance have come from these groups.

A ruling in July 2011 allowed candidates to attend super PAC fundraisers; the idea of hybrid PACs that have a bank account both for independent and coordinated expenditures originated with an advisory opinion request to the FEC, and U.S. Sen. Mike Lee (R-Utah) submitted an advisory opinion request last month asking whether a leadership PAC could also open an independent expenditure bank account.

But “the cutting edge of how much interaction on the spending of money can you get away with,” said Ryan, is being pushed by the super PAC American Crossroads. Its request seeks permission for American Crossroads to run advertisements that “feature incumbent members of Congress who might face uncertain re-election prospects,” and asks whether this could hurt its status as an independent expenditure committee.

Weakness of the FEC

The Federal Election Commission, the body charged with enforcing campaign finance laws, is first and foremost hampered by an ideological divide. Five of its six commissioners are on expired terms, and three Republican commissioners “think all campaign finance laws unconstitutional.”

This leads to lax regulation of what is already an “unlimited, unregulated shadow campaign,” says Ryan. “Million-dollar contributions to the Super PACs pose just as big a threat of corruption as would million-dollar contributions directly to candidates.”

“Barack Obama has been one of the protest mobs’ biggest cheerleaders,” writes the campaign’s chief and right-wing political consultant Joe Wierzbicki in a release announcing a new campaign ad. ”The new poll finds that support for the violent Occupy Wall Street mobs has fallen further, and since Barack Obama has been one of the protest mobs’ biggest cheerleaders, it spells trouble for him as well.”

The mainstream media hasn’t spent much time highlighting this vulnerability for Obama, but that is where you come in. We urgently need your help to raise the money to launch our new TV ad campaign that shows how Democrat leaders shamelessly have championed the Occupy Wall Street mobs that have cost taxpayers millions of dollars and created considerable damage in cities across America.

The ad closes with a question: “Are we going to let these mobs and their Democrat champions do this to America, or are we going to fight back?”

Voters still sympathize to a significant degree with the main message of the movement, which centers on the need to address the inarguable fact of expanding inequality in the country tied to the finance industry and corporate America. Although recent polls report dipping popularity for the Occupy movement, they also report greater support for the movement than for the Tea Party, with much greater public sympathy for the movement than for Wall Street and large corporations.

Wierzbicki is a longtime pitchman for Republican Party-associated firm Russo Marsh & Rogers. Wierzbicki’s 2011 Campaign to Defeat Obama PAC shares a Willows, California, PO Box with the Our Country Deserves Better PAC and with TeaPartyExpress.org. All three organizations share the same treasurer, a Kelly Lawler, who was a former staff member at the National Republican Campaign Committee.

As the “OWS as Democratic Party-backed public menace” ads hit the airwaves, a blogger for the Economist underlined how Occupiers might pose a major political problem for Democrats.

“As long as the Occupy movement remains without acknowledged leaders who can credibly distance it from the worst behavior of its least reasonable affiliates, the movement will increasingly come to be defined by its most egregious episodes.”

The blogger points to CBS coverage from clashes in Oakland.

“You see the problem? Who watches CBS News? Older people. Older people who don’t cotton to this sort of shenanigans and who vote in droves.”

The Massachusetts Republican Party recently launched a nearly identical campaign targeting Democratic Senate candidate Elizabeth Warren as the “matriarch of mayhem.”

According to the Center for Responsive Politics’ OpenSecrets blog, companies including AT&T, Exxon Mobil, Kraft, Coca-Cola and the infamous Koch Industries that are part of ALEC’s “private enterprise board” have spent millions on these tactics to influence local and national government.

“Legislators welcome their private sector counterparts to the table as equals, working in unison to solve the challenges facing our nation,” ALEC’s website states. ALEC, a conservative grouping of state legislators and corporate interests, has come under fire for drafting bills, including Arizona’s SB1070, that benefit private business interests.

The Pharmaceutical Research and Manufacturers of America (PhRMA) has spent the largest sum on lobbying –- in 2010, the drug trade group spent more than $22.74 million hired and 156 lobbyists, 59 percent more than any other company on ALEC’s board.

The congressional connection goes both ways: Of the lobbyists hired by PhRMA, the Center for Responsive Politics found, 120 were once federal employees and four were former members of Congress.

The Center for Media and Democracy, which leaked information from a whistleblower on ALEC’s role in drafting legislation, found a continuing rise in lobbying pressure from ALEC board members. Ten of the 23 companies had lobbied the EPA in 2009 while, during the first six months of 2011, eight had already done so.

The Center for Responsive Politics also noted that not only did the corporations pressure Congress directly, but individuals and political action committees (PACs) affiliated with the 23 corporations have given millions to candidates and committees.

Calling it “Christine PAC” for now, she described it as “the new kind” of PAC that will allow her to endorse candidates, do independent expenditures in certain races, lobby on issues and do things “that other activist organizations have the handcuffs on because of the IRS.”

The super PAC, a creation of recent court decisions and Federal Election Commission opinions, can raise unlimited amounts of money and run independent expenditures for or against candidates, and their donors have to be disclosed. Seventy-two super PACs were formed for this past election cycle, and spent $83.7 million in the elections. Examples include Karl Rove-affiliated American Crossroads or Dick Morris’ Super PAC for America.

Sarah Palin’s PAC, SarahPAC, is a leadership PAC, so it has a $5,000 limit on contributions and expenditures to candidates or other PACs.

The donations show a remarkable concentration of wealth for an organization that claims to be grassroots. In its initial IRS filing as a 527 organization on March 29, the group described itself as, “an independent, national grassroots political organization whose mission is to speak out in support of conservative issues and candidates across America.”

The largest donor to the 527, contributing 47 percent of the total cash in the latest filing, was a familiar one — Texas home builder Bob Perry, who helped fund another 527 group Swift Boat Veterans For Truth prior to the 2004 election, which ran ads attacking the military service of Democratic candidate for president Sen. John Kerry. Perry contributed $5 million in October and $2 million in September. Perry’s net worth has been estimated at $650 million, and he has contributed to dozens of Republican causes since the mid-1980s.

The second-largest individual donor was Robert Rowling, CEO of TRT Holdings, an Irving, Tex.-based energy company. Personally, he gave $1.5 million to Crossroads in the latest filing, bringing his year-to-date donation total to $2.5 million. TRT Holdings also donated $1.5 million to Crossroads as a corporation. According to Forbes, Rowling isnumber 64 in the Forbes 400 List of Richest Americans, having a net worth of $4.2 billion.

B. Wayne Hughes, chairman of Publican Storage, the largest self-storage company in the United States, contributed $1 million on September 15, bringing his year-to-date contributions for Crossroads to $2.3 million. He was number 85 on the Forbes List of Richest Americans in 2009, having a net worth of $3.5 billion.

Alliance Resource Partners, a Tulsa-based coal producer with $1.1 billion in revenues and $1.2 billion in assets as of 2009, donated $2 million. A roof in an Alliance-owned mine in Kentucky collapsed on April 28, killing two miners. The non-union-owned mine had been cited for 214 safety violations. MSHA issued a citation to Alliance for the accident on October 8.

American Crossroads has spent more than $16 million this cycle in political advertisements and other communications.  An affiliated group to Crossroads is American Crossroads Grassroots Policy Strategies, a 501 (c)(4) “social welfare” group, does not have to disclose its donors; however, tax law prohibits it from spending roughly more than 50 percent of its funds on election materials. It has spent around $11.5 million dollars thus far in independent expenditures and electioneering communications.

In its mission statement, Crossroads describes itself as, “a new kind of non-profit political organization dedicated to renewing America’s commitment to individual liberty, limited government, free enterprise and a strong national defense—through informed and effective political action by citizens like you.” However, most of its action is paid for by just a few wealthy donors.

If you’re more of a visual learner, however, you’ll be happy to see that The New York Times has published a story that includes a fun video and also the following chart that breaks down campaign finance law in the post-Citizens United world:

Interestingly enough, some issues, like the accurate and complete disclosure of political donations to campaign ads, were a big problem even before the Supreme Court ruled in Citizens United v. the FEC. The recent court case opened up the possibility that corporations could spend directly on ad campaigns on behalf of candidates, but most were already well acquainted with the shell game of giving to nonprofit corporations with like-minded views in order to hide their own political activity. The difference now, however, is that these nonprofits are allowed to get involved directly in the game of advocating for candidates, as long as it doesn’t become their primary mission.

Because it’s become the focus of so much popular fear and resentment, however, Citizens United has become an useful rallying point for those seeking to repair the campaign finance disclosure system through legislation like the DISCLOSE Act.

Gallant is an associate at the firm of Bopp, Coleson & Bostrom. The firm’s head, James Bopp, Jr., is the conservative lawyer behind much of the turmoil in election law these days: he argued the Citizens United case at every level up to the Supreme Court, for instance. The firm is currently arguing approximately 50 cases around the country for NOM and other groups that center around the issues of nonprofit organizations, political speech, and their First Amendment rights in the wake of Citizens United.

In short, Gallant told me, groups like NOM, which are registered as 501(c)4 “social welfare organizations” and not political committees, are making the case that states are acting unconstitutionally by compelling them to register as political committees (PACs) when they decide to spend money on elections. The brief that NOM filed on September 14, argues as much; however, it is 42 pages long and full of legalese, so I asked Gallant to explain it a bit.

The first claim NOM makes in its brief is that the group’s “injury is the chill to speech caused by Defendant’s prospective enforcement of Rhode Island law or prosecution of NOM,” and that, therefore, “NOM has standing to seek relief from the chill.” It seems a little odd for the group to claim injury based on the State of Rhode Island potentially enforcing its laws and prosecuting NOM in the future, but Gallant argues that such claims — called “pre-enforcement challenges” — actually aren’t that odd at all:

“That’s typical. It’s what’s called a pre-enforcement challenge and its often recognized in First Amendment contexts in which an organization is faced with either doing its speech and being charged by an enforcement agency or holding off on its speech  The speech is said to be ‘chilled’ and the organization can seek relief with a preliminary injunction.”

Another important claim in the brief is that “The Rhode Island Law is Vague, and therefore Overbroad.” Vague and Overbroad, again, are legal terms of special significance, explains Gallant:

“In a First Amendment context, vagueness is a special concern. If a group or individual doesn’t know if what they want to do is regulated, then they take a wide berth around it… Overbreadth is when the law sweeps in conduct or communications that cannot constitutionally be regulated.”

“An organization can’t be swept into the political action committee regulatory scheme unless its either under control of a candidate or its major purpose is the election or defeat of a candidate [NOM is neither]. The communication itself may be regulable — in other words it may fall under a constitutionally proper definition of an expenditure — but a lot of states, based on that, sweep the organization itself into regulation as a political committee and you can’t do that.”

Basically, NOM is testing the waters in a number of states, challenging state laws that place restrictions on corporations spending in state elections after the Supreme Court ruled in Citizens United that they have a right to do so. In that same ruling, however, the Supreme Court upheld current federal disclosure laws 8-1, so NOM’s claim that it shouldn’t be compelled to disclose its donors to state election boards seems like it’s on more shaky ground.

In a lawsuit filed last week against the state, the National Organization for Marriage says it should not have to report its expenditures or comply with spending limits or bans that are required for political action committees.

The group – which held a rally against gay marriage on the State House lawn in July, sparking a counter-rally — argues it shouldn’t be considered a PAC, and says the rules for PACs are burdensome and interfere with free speech.

NOM’s tactic — flout an individual state’s campaign finance laws by failing to register as a PAC and to report its donors, then sue the state for interfering with free speech if its election board attempts to force the group to comply — is pretty standard fare by now. The group is engaged in similar lawsuits in California and Maine, and it’s currently refusing to register as PAC despite its political activity in the state of Minnesota as well.

Most independent observers predict NOM’s challenges will eventually fail — the group has already lost a similar case in the Supreme Court regarding disclosure of its political activity in the state of Washington — but the group’s plan, for now, seems to be to delay as long as possible. It’s got deep enough pockets to fight these cases in the courts for months — or even years — allowing its political spending in state races, meanwhile, to go undisclosed until long after the elections in question have been decided.

Doyle notes how the initial two groups, conservative Club for Growth and Democratic-leaning Commonsense Ten, have been joined by about half a dozen others — including the already notorious Rove and Gillespe 527 group, American Crossroads — in registering in the last few weeks as “independent expenditure committees” that will collect unlimited amounts of money for campaign spending. Disclosure reports show the Club for Growth has received a total of $75,000 from just two donors, for instance.

But not all these groups are planning on registering as PACs, and many continue to spend thousands, and sometimes millions of dollars on campaigns without listing any donors:

[T]he American Action Network filed an independent expenditure report with the FEC Aug. 5 indicating that it is spending nearly $435,000 for cable television and radio ads in the New Hampshire campaign for an open U.S. Senate seat. The report listed no donations funding this spending.

The ads in question target Senate candidate Rep. Paul Hodes (D-N.H.) for his stance on climate change legislation. They’re not the only ones the group has cut, though. Again, according to Doyle’s report:

The American Action Network has indicated on its website that it also sponsored ad campaigns focused on Senate races in Washington state and Florida; however, it filed no reports with the FEC on its spending in those states. The group indicated in press releases that it considered its efforts in these races to be “issue advocacy” not subject to any FEC reporting rules.

I asked Pawlenty whether he and his PAC would push for voter registration reform along the lines of his own state’s fairly straightforward process, which allows registration up to and including Election Day. (Thanks to my colleague Graham Moomaw for typing it up.)

“One potential corrosion of our freedom and liberty is to have the democratic system, the election system, being undermined or becoming even partially fraudulent or lacking in credibility,” said Pawlenty. “We have electronic scanners in Minnesota. The ballots that were cast last time through the scanners were 99.9 or so percent accurate. There were no problems with them and the individuals who cast those ballots had to present themselves at a polling place in person and with at least some, you know, screens around identification and proper voting.”

Pawlenty went on to say that “all the problems in Minnesota in the Franken-Coleman [Senate] race related to the absentee ballot process.”

“I’ve been told that in 2006 there were 12,000 absentee ballots cast in our state,” said Pawlenty. “That’s a high number based on a historical number, so keep that in mind, 12,000 in 2006. In 2008, there were almost 300,000 absentee ballots cast in our state. Now this is a process where people are supposed to use absentee ballots because they’re unavailable in their voting area on Election Day because they’re out of the state, they’re on business travel, or they’re medically or physically unable to show up. So you can see in a presidential race, you know, an increase of say 10 percent or 20 percent or something like that from 2006. But what you saw is approaching this 3,000 percent increase, in absentee voting in Minnesota … obviously something very extraordinary occurred and what occurred is you had grassroots organizations come in here and use the absentee ballot process as a substitute for voting by mail. And, almost all of the problems … in the Franken-Coleman case come out of these absentee ballots.”

Pawlenty circled back to my question about whether his own state’s voter registration system should be a national model. “Same-day registration in Minnesota would be fine if we had more stringent identification requirements,” he said, “specifically photo ID. We don’t require, and we should require in Minnesota, photo ID. So it’s not that the timing or the day of it is the problem. It’s making sure that we welcome any legal person who’s entitled to vote, to vote. We just need to make sure it’s appropriate. Now, we don’t have a history or tradition in Minnesota of a lot of voter fraud or these kinds of concerns but this Franken-Coleman experience, particularly as related to the absentee ballots, gives us pause. So, it’s not so much a same-day registration issue as it is making sure the registration, and the identification that goes along with it, is rigorous and appropriate.”

I told Pawlenty that I’d asked the question in the context of him hiring Sara Taylor to work for his campaign, and wondered whether he agreed with the priority she, and the Bush administration in general, placed on poring over voter rolls for alleged registration fraud.

“Absolutely,” Pawlenty said. “We should aggressively, at the state and federal level, enforce voter fraud concerns and to aggressively investigate and enforce voter fraud concerns. Because if we allow any corrosion to the integrity of the system, it calls into question the entire credibility of the results of the election and ultimately the pillars of the democracy. It is extraordinarily important. It goes to the core credibility and acceptance of our democratic system. And if people are going to question the outcome and say it was derived by fraud, as opposed to the will of the people, you’ve undermined a core tenet of democracy. It’s very concerning. Now, so to answer your question, we should make it a critical priority.”