Fueled by an expanding class of billionaires, political spending on the 2022 midterm elections will shatter records at the state and federal levels, with much of it from largely unregulated super political action committees financed with enormous checks written mainly by Republican megadonors.
"We've broken records with our broken records," said Sheila Krumholz, executive director of the nonpartisan Open Secrets, which estimated Thursday that total spending in 2021 and 2022 would reach $16.7 billion when tallied after Election Day, easily surpassing the previous midterm record of $14 billion set in 2018.
The total spent on federal races, currently $7.5 billion, has already passed the inflation-adjusted record of $7.1 billion in 2018 and is expected to reach $8.9 billion when all is tallied. Of that, 15.4% has come from billionaires, up from 11.9% in 2020 and 15.3% in 2018. Beyond billionaires, the top 1% of donors, measured by income, has given 38% of the total.
The campaign finance system increasingly mirrors American society, with hundreds of thousands of small donors trying to keep pace with a billionaire class whose spending appears nimble and bottomless. Democrats have largely kept up on the airwaves by constantly hectoring rank-and-file supporters to pitch in.
But billionaires from high finance, Silicon Valley, media and old-line manufacturing have given party-aligned ideological groups — mainly conservative ones — an easy way to surge forward. And as inflation pinches small donors, megadonors are becoming all the more important.
"This is a crucial sector of the contribution base because they are able to nimbly put in whatever amounts are needed at any moment," Krumholz said Thursday. "It's a highly volatile source, and it could change rapidly, even in the next few days."
While both parties have their billionaires, Republicans have many more. Of the 25 top donors this cycle, 18 are Republican, according to Open Secrets, and they have outspent Democrats by $200 million. Billionaires make up 20% of total Republican donations compared with 14.5% of Democratic donations.
Even that may understate the disparity.
The largest donor of 2022 by far was a Democrat, George Soros, whose contributions of at least $126 million were nearly double the roughly $67 million that the next two largest donors, Republicans Richard Uihlein and Kenneth C. Griffin, each ponied up.
But the Soros total is deceptive. Virtually all of Soros' contributions, $125 million, went to his political action committee, Democracy PAC, which in turn disbursed only a small fraction of it, about $15 million.
In contrast, the $135 million from Uihlein, head of the Uline packaging giant, and Griffin, founder of Citadel, one of the largest hedge funds in the world, has flooded the Republican ecosystem with political advertising that may soon help secure Republican control of Congress.
Griffin made his hopes clear in a statement Thursday. "Tragically, we have all seen majestic cities such as Chicago and San Francisco devastated by progressive leftist policies," he said, citing more than a dozen deaths on Halloween in the city he recently abandoned, Chicago. "In a few days, I believe American voters will say we've suffered enough from these misguided policies."
Beyond such well-known megadonors are billionaire contributors of far less renown. Jeff Yass, a Philadelphia-based trader who founded the Susquehanna International Group hedge fund, is hardly a household name, but his contributions of nearly $50 million made him the fourth-largest donor of the cycle.
Timothy Mellon, the quiet heir of the Mellon banking fortune, ranked fifth after writing checks worth $15 million to the Congressional Leadership Fund; a $5 million check Sept. 15 to the Wisconsin Truth PAC, which is blistering Democrats in the state; checks totaling $6 million this fall to the Sentinel Action Fund, a new super PAC run by the Heritage Foundation's political arm; and a $4 million check in September to the opaque American Policy Fund, which has spent more than $5 million attacking Sen. Michael Bennet, D-Colo.
"Is this consistent with democratic — 'little d' — principles when you have billionaires dropping millions of dollars and they are having such an effect?" asked Kenneth R. Mayer, a campaign finance expert and political scientist at the University of Wisconsin. "We're breaking records every cycle."
The sixth-largest donor is a Democrat who made arguably the biggest splash for his party this cycle, Samuel Bankman-Fried, a 30-year-old cryptocurrency billionaire. His $37 million in giving helped fund the Democrats' two main super PACs, the Senate Majority Fund and the House Majority Fund, as well as the party's official House and Senate campaign arms.
But Bankman-Fried's biggest giving, at least $27 million, went to Protect Our Future PAC, ostensibly devoted to backing candidates who would champion pandemic protection. It in turn sank more than $11 million on a failed Democratic primary candidate in Oregon, Carrick Flynn, as well as other primary efforts in solid Democratic districts.
Unlike Republican megadonors, Bankman-Fried is also trying to maintain relations in both parties, giving at least $45,000 to the National Republican Congressional Committee and thousands more to Republican senators like Bill Cassidy of Louisiana, John Boozman of Arkansas, Susan Collins of Maine and John Hoeven of North Dakota.
Rounding out the top 10 donors of the 2022 midterms are Stephen A. Schwarzman of the Blackstone Group, a giant investment firm; Peter Thiel, the technology investor who personally bankrolled the Senate campaigns of two protégés, J.D. Vance in Ohio and Blake Masters in Arizona; Fred Eychaner, a media executive and major Democratic donor; and Larry Ellison, the billionaire founder of the software giant Oracle, who channeled millions of dollars into Republican campaigns through the super PAC Opportunity Matters.
Only Griffin returned requests for comment among the top 10 donors.
Campaign finance numbers are notoriously difficult to track precisely. An adviser to former Mayor Michael Bloomberg of New York said his total giving for Democrats for the 2022 cycle was around $70 million, which would put him near the top of the list. But because Bloomberg saw threats to democracy concentrated at the state level, his donations have focused on races for governor and secretary of state in battlegrounds like Pennsylvania, Michigan, Wisconsin and Nevada. Those contributions do not appear in the federal campaign database.
Indeed, none of the figures tabulated by the New York Times or Open Secrets can be considered complete; all of them are likely to underestimate total contributions. That is because a complicated shell game — giving to political organizations that in turn give to other political organizations — masks exactly who is giving how much to whom.
Since some of those organizations are considered tax-exempt "social welfare" organizations — groups organized under Section 501(c)(4) of the tax code — they may never disclose their donors. And because much of the spending is on highly targeted online advertising that is far less regulated than television ads, total spending may be impossible to determine, Krumholz said.
For a state such as Wisconsin, where two megadonors, Uihlein and Diane Hendricks of Hendricks Holding Co., are spending heavily to reelect Sen. Ron Johnson, a Republican, and oust Gov. Tony Evers, a Democrat, voters may feel besieged by impenetrable political forces, said Eleanor Neff Powell, a political scientist at the University of Wisconsin.
"To be honest, I don't think the vast majority of folks in Wisconsin are aware at all of what's going on," she said. The system is "so opaque, it's hard for the average voter to put all these pieces together."
Out of Uihlein's nearly $70 million in spending, at least $26.4 million went to the conservative Club for Growth, which has pummeled Democrats with negative advertising. Another $13 million went to the Illinois-based Restoration PAC, which has spent against Evers and Johnson's Democratic challenger, Lt. Gov. Mandela Barnes, as well as against Sen. Raphael Warnock, D-Ga.
But Restoration PAC also funneled $15 million to yet another organization, Americas PAC, which then went after Barnes, Warnock and Democratic Sens. Maggie Hassan in New Hampshire and Catherine Cortez Masto in Nevada, as well as Lt. Gov. John Fetterman, the Democratic Senate candidate in Pennsylvania.
The multitude of money flows makes following dollars difficult. Yass appears intent on keeping it that way. More than $6 million of his money went to Club for Growth, in keeping with his past giving, but he also gave $15 million to something called the School Freedom Fund, virtually its lone source of money.
The School Freedom Fund then spent more than $1.5 million of Yass' money to sink the Senate primary run of former Gov. Pat McCrory of North Carolina, $654,000 in a failed bid to secure the Republican Senate nomination for Rep. Mo Brooks in Alabama and nearly $2 million to win a House nomination in a deep-red Oklahoma district for newcomer Josh Brecheen.
Yass also wrote a single $5 million check to the Kentucky Freedom PAC in March 2021, which then transferred that amount to another of Yass' favorite recipients, the Protect Freedom PAC, to which he had already given $4.5 million. Much of the latter group's money went to failed far-right candidates, but it also spent generously to defeat Rep. Liz Cheney of Wyoming in the Republican primary in the summer.
By shuffling money from one group to another until one of them finally spends it, candidates and donors alike have deniability for how it is used.
"Everybody can wash their hands of the nastiness," Powell said.
Some of the most incendiary ads of the campaign have cropped up in the last few days, from new groups with titles such as Citizens for Sanity, a nonprofit that does not have to disclose its donors, and America First Legal, a group started by Stephen Miller, a former adviser to Donald Trump, that has yet to disclose any donors.
Problematic for Democrats was who ended up below the top 10. Bloomberg was the 11th-largest federal spender, with more than $27 million in contributions, including $11 million to the Democrats' House Majority PAC. But his other big checks went to more narrowly focused groups like the League of Conservation Voters and his own Independence USA PAC, which focuses on gun laws, the environment and education. Its only expenditures this cycle appeared to be aiding Rep. Lucy McBath, a longtime ally on gun control, in a Georgia primary against a fellow Democrat.
More noticeable was the absence of S. Donald Sussman of the hedge fund Paloma Partners, who went from one of the biggest political givers in the Democratic Party and the nation to a no-show in the top 50 after he told party officials he would pause his giving until Congress advanced voting rights legislation.
Shane Goldmacher contributed reporting.