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In the first presidential debate, Mitt Romney leaned heavily on what he called “a study by the National Federation of Independent Business” to argue that President Obama’s tax fairness plan would somehow cost 700,000 jobs. The study wasn’t actually conducted by NFIB – they just paid for it. A look at what else they pay for tells us more than Mr. Romney would like.

Among other projects, NFIB is paying for political advertising in nine states – Colorado, Florida, Iowa, Missouri, North Carolina, Nevada, Ohio, Pennsylvania and Virginia – as part of its “Stop Obama’s Regulatory Tidal Wave” campaign. As NFIB told Politico in July, this will include “a substantial financial commitment.” Just as importantly, the financial sources for this campaign won’t be disclosed.

The group likes to call itself the voice of small business, but its record is squarely in line with Republican Party politics and big business interests. Beginning in 2010, the supposed champion of the corner store found a way to fight through years of legal hearings and pay former Solicitor General Paul Clement to argue its case against the Affordable Care Act before the Supreme Court. Mr. Clement is one of the nation’s top lawyers, and losing a case that big wasn’t cheap for NFIB.

The group was happy – and completely prepared – to pay up.

Because the outcome of that lawsuit was so important to the country, I felt the American people should know where all that money came from. What my staff and I found was a case study in what’s wrong with American politics, and why Mr. Romney should be more careful with his citations.

In 2010, as its lawsuit geared up, NFIB received a $3.7 million grant from Karl Rove’s Crossroads GPS. It was the second largest of a dozen grants disclosed by Crossroads in that filing, bigger than eight others combined. Between 2010 and 2011, NFIB and its affiliated Small Business Legal Center took in more than $10 million from just ten donors.

Compared to their biggest donations in 2009 – $21,000 for NFIB and $7,500 for the Legal Center – this was an unusual flood of very large checks. What “small businesses” were suddenly giving six- and seven-figure donations?

I and my Congressional Progressive Caucus co-chair, Rep. Keith Ellison, wrote to NFIB President Dan Danner on June 12 to ask for a list of the group’s recent donors and members. If the nation’s health care system hung in the balance, it seemed a fair question.

The group has a strange history of misleading the public about this. In 1997 it claimed to represent 650,000 businesses, a figure repeated in the Los Angeles Times and elsewhere. Today, the group claims to represent 350,000 members.

Whatever the number, Mr. Danner didn’t respond to our inquiry. Instead, one of his spokespeople told a conservative website called The Daily Caller, “I’m not sure why the Progressive Caucus thinks that they can compel us to disclose things that we are not legally required to disclose.”

Up to that point, all NFIB had done was sue the federal government using millions of dollars in conservative activist donations without disclosing its funding sources. Once we started asking questions, the public relations team went into overdrive. On June 25, the Wall Street Journal editorial page ran a column calling us part of a “smear campaign” and a “liberal intimidation campaign” against the small business community. Somehow Mr. Danner – who earned $743,676 in 2011, far more than your average small business owner – got the attention of the nation’s premier conservative opinion-makers when he needed it most.

The Journal column, which credulously repeated NFIB’s claim to have increased membership 5 percent since it launched its health care lawsuit, dismissed the possibility of Mr. Rove’s involvement as standard Democratic hysteria. It did not explain the size or timing of the Crossroads donation.

This is legal because the IRS has a “social welfare” loophole for non-profit groups allowing supposedly non-political activist groups to spend money politically and get away with it. The very wealthy people making decisions at NFIB weren’t thinking of social welfare – except maybe their own – when they launched a multi-million-dollar lawsuit against the nation’s strongest health care reform law in decades. Where’s the accountability?

As far as that study Mr. Romney cited in the debate, nonpartisan Congressional Budget Office and Joint Committee on Taxation analysts say the president’s plan would “help the economy in the long run by leading to lower interest rates and higher investment — the opposite of what the NFIB study concluded.” So much for the small businessman.

Meaningful political and campaign finance reform has to make it harder to manipulate policy and hide your intentions. If Democrats have a majority next year, this must be at the top of our to-do list. Cleaner politics means a cleaner government, and that’s not something we can wait for any longer.

Originally posted to Raul Grijalva on Mon Oct 22, 2012 at 01:37 PM PDT.

Also republished by Baja Arizona Kossacks.

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