The Swarm

Mix it up with The Bee's editorial board.

October 7, 2011
Consultant Dave Gilliard's attack on Sen. Barbara Boxer paid off

At this time last year, an obscure shell of a corporation called Taxpayer Network aired an attack on Sen. Barbara Boxer.

If the ad's intended effect was to defeat Boxer, it failed. Boxer won reelection. But the ad did help line a few pockets, a document released a year later shows.

Taxpayer Network raised money from anonymous donors, spent $790,000 on the ad, then returned to anonymity. It's probably all perfectly legal, given the antiquated Internal Revenue Code, toothless Internal Revenue Service regulations, and a Federal Election Commission that fails to take enforcement action.

Taxpayer Network did comply with one requirement, sort of. Because it is a nonprofit and exempt from paying corporate or incomes taxes, Taxpayer Network must file a public tax return, and make it available upon request.

I asked Taxpayer Network for that return numerous times and, as I noted in my column last week, it failed to provide it.

The IRS, meanwhile, sent a copy the other day, two weeks after I made a separate request.

The tax return, dated Aug. 10, 2010, doesn't reveal much. Such documents rarely do. It shows that in 2010, the entity received $840,500 in contributions. There is no requirement it identify the donors, unlike traditional campaign committees, which must identify their contributors.

Taxpayer Network shows $811,608 in total expenses, including $790,000 for the ad, but offers specifics for only $291,198 in expenses.

The biggest single expenditure -- $150,998 -- went to Almanac Advisors, a company owned by Sacramento-area campaign consultant Dave Gilliard.

In addition to his work for Taxpayer Network, Gilliard represents the Republican's recent effort to launch a referendum over the California Redistricting Commission's work, and candidates including Rep. Darrell Issa, a San Diego County Republican, and Rep. Ed Royce, an Orange County Republican.

The second largest expense, $119,340, went to Channel 10 in Sacramento to pay for air time. There was another $14,500 for legal expenses, and $5,175 for accounting.

Taxpayer Network's officers include treasurer David McIntosh, a former Republican congressman from Indiana. McIntosh is a lawyer-lobbyist in the Washington, D.C., office of the law firm, Mayer Brown. In his lobbyist practice, he represents the U.S. Chamber of Commerce, a bank, an electric utility and chemical interests.

Other officers include Bruce Hughes and Lisa Hughes, who are Orange County family law attorneys who long have been involved in Republican politics. The Hughes and McIntosh didn't return calls.

In national politics, Taxpayer Network is a blip. But it's emblematic of the secrecy that increasingly shrouds political campaigns.

It's an old-fashioned notion, but campaigns ought to be conducted in the open. There should be disclosure about how money gets raised and spent before voters go to the polls.

In the 2012 campaign, nonprofit corporations and consultants from the left and right will hide behind outdated laws and level unfounded attacks against politicians. In the process, they will make a mockery out of what should be the world's most open and honest democratic system. Granted, that is a quaint notion.

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About The Swarm

The Swarm is written by members of The Sacramento Bee's editorial board. They meet daily and are separate from the newsroom. Views included here are those of individual writers, and do not necessarily reflect those of a majority of the board or the positions expressed in The Bee's editorials.

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