Mega-Donors Catching Grief From Media, Obama Campaign

by InvestorPlace Staff | May 31, 2012 5:55 pm

[1]The rise of super PACs has had many consequences this election cycle. The unlimited money available to groups who support — but don’t collaborate with — candidates for office kept Newt Gingrich in the Republican nomination race far longer than many pundits thought possible, and has given Mitt Romney a fighting chance against the Obama campaign’s fundraising machine.

But it isn’t just the candidates that super PACs support and oppose being affected by these donations. Sometimes, it’s the donors themselves[2].

Several of the largest super PAC donors have found themselves under increased scrutiny from the media and both sides of the political divide for their largesse. A $1 million Romney super PAC backer found a story written about him once being wanted for criminal mischief after driving a photographer’s SUV into a pond[3]. Other donors have said their businesses have suffered from being on a list Obama’s campaign compiled of the largest conservative super PAC donors. Some conservative web sites have even countered by posting their own lists of rich donors to Democratic causes[4].

In response, many donors have hit back. Frank VanderSloot, the CEO of health and home products company Melaleuca, gave $1 million in corporate cash to Romney’s super PAC, and has helped raise between $2 and $5 million for his campaign. His name made it on an Obama campaign web site[5] that said he had a “less-than-reputable record”. He countered by appearing on Fox News calling for donations to Romney in protest and said that he could continue giving to the super PAC every time something untruthful about him was published. He has even created his own web site[6] to defend himself.

Also fighting back against media criticism is TD Ameritrade (NYSE:AMTD[7]) founder Joe Ricketts, who was criticized after his alleged plans to spend $10 million of his money on ads attacking Obama for his link to Rev. Jeremiah Wright were revealed in a New York Times article[8]. His family released a statement saying it was “deeply hurtful and unfair” to suggest he was planning to do so.

In response, conservative groups and web sites have targeted several liberal donors for criticism. Comedian Bill Maher, who gave $1 million to the Obama super PAC, received criticism for comments he made about Sarah Palin. Maher said attempts to bring up the Palin controversy were merely attempts to divert attention from their own problems. Conservative web sites have also been digging up dirt on former New Jersey Gov. Jon Corzine, Hollywood executive Jeffrey Katzenberg, and George Soros.

For more information on this story, check out this Politico post[9].

Benjamin Nanamaker, InvestorPlace Money & Politics Editor

The opinions contained in this column are solely those of the writer.

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