A political group run by prominent conservative Trump critics has burrowed its way fully under the skin of the president and his political team, who have hit back hard by calling the group’s members “washed up Washington swamp creatures” and dubbing the group itself a “scam PAC.”
The atacks from the Trump reelection campaign this week against the Lincoln Project and its principals—people including longtime GOP attorney George Conway and political operative Rick Wilson (a Daily Beast columnist)—are based on the premise that the organization is running hard-hitting anti-Trump ads not to damage the president but to line the pockets of its own executives and cosultants. Hence the label “scam PAC,” a term for a political group that does little in the way of actual politicking, and mostly exists to raise money and then pass it along to its principals.
“Financial disclosures show that over 90 percent of the Lincoln Project’s recent donations went towards nothing other than lining the pockets of those who run the group,” wrote Republican National Committee chair Ronna McDaniel in a column last month.
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PAY DIRT accepts second place to no one in our distaste for scam PACs, so we dug into the numbers to see if there was anything to McDaniel’s allegations, which were echoed in a Trump campaign email on Wednesday that dubbed the Lincoln Project “a transparent way for political bottom feeders to make easy money.”
And, in fact, the actual numbers belie the attack. Indeed, they show that the Lincoln Project is relying on the same sorts of spending and accounting practices that have led to allegations that senior Trump campaign aides have enriched themselves at the expense of the president’s reelection effort and its donors.
McDaniel’s claims rely on a misinterpretation of the group’s financial reporting that assumes, wrongly, that Lincoln Project executives are simply pocketing the money that’s channeled through their political consulting firms. Look a little deeper than that cursory review, though, and it’s clear that that’s simply not the case.
McDaniel and the Trump campaign focused their charges of financial shenanigans on numbers reported to the Federal Election Commission. The 90 percent figure mentioned in her column comes from tallying up payments reported in those FEC filings to consulting firms owned by the group’s senior staffers; chief among them Summit Strategic Communications and Tusk Digital, firms run, respectively, by Lincoln Project “advisors” Reed Galen and Ron Steslow.
From its formal launch in November through March of this year, the Lincoln Project has paid those two firms about $1.35 million in operating expenses and outlays associated with the group’s ad buys and other independent expenditures. Its total operational and IE spending over the same period was about $1.62 million.
If you don’t dig any deeper into the numbers, it looks like McDaniel has a point. Conservative commentators have echoed the allegations as well.
“It is a pure money scheme,” wrote a writer for the website RedState in a piece linked in McDaniel’s column. “Financials from TLP have come out and they show that a significant amount of the money taken in is not sent out to the field for grassroots or even professional activism—it is sent to the interests of those on the TLP board.”
That is simply not true. In fact, huge portions of the reported payments to Summit Strategic and Tusk Digital have gone towards the group’s actual political activity. That’s apparent by cross-referencing the vendors it’s reported paying—primarily firms owned by Galen and Steslow—and the media organs that have reported receiving money from the group to air its political communications.
From December 2019 to present, for instance, the Lincoln Project has spent $277,000 on political advertising on Facebook and Instagram, according to Facebook’s ad archive. But the group hasn’t reported a single expenditure to Facebook in its FEC reports.
That tells us something critical about how the group is spending its money: Facebook is effectively a Lincoln Project sub-vendor, which isn’t required to be itemized in FEC reports. In other words, one of the consulting firms that the Lincoln Project is paying is using the money it receives from the group to lodge those Facebook ad buys. It’s not just pocketing the money, it’s spending it to advance the group’s political agenda through paid media.
The same pattern is apparent in the Lincoln Project’s filings with the Federal Communications Commission. Those filings show that it employs an ad buyer called Ashton Media, run by a media consultant named Steve Hazleton, to reserve and purchase television airtime. FCC filings analyzed by the Center for Responsive Politics show the Lincoln Project has spent at least $120,000 to place TV ads. But as with Facebook, the group hasn’t reported paying a dime to Ashton, suggesting that it too is a subcontractor for one of the consulting firms bringing in those large lump sum payments from the PAC.
Those payments to Ashton and Facebook only include the costs of actually placing the ads. On top of that, there are significant production costs, and FEC records indicate that the Lincoln Project has employed the video production firm Howe Creative for that task.
Howe Creative, run by conservative author Ben Howe, is also employed as a subcontractor, as one FEC filing in particular makes clear. On February 14, the Lincoln Project reported paying Summit Strategic $6,810.18 for “digital production costs.” On the same day, the group paid the exact same amount, for the same purpose, to Howe Creative, indicating that it was acting as a subcontractor for Summit Strategic for the purposes of that independent expenditure.
Howe told PAY DIRT that that was just one invoice of many paid by Galen’s consulting firm. The $6,810.18 line item was for production expenses related to Howe’s work on a digital ad called Telling the Truth. Howe said that was just one of 24 ads his company has produced for the Lincoln Project, all billed to Summit Strategic, including Mourning in America, the spot that got Trump and his allies so riled up this week. So once again, significant amounts of the sums ostensibly “lining the pockets” of Lincoln Project consultants actually went towards bona fide political activity.
The group’s payments to Howe, Ashton, and Facebook are only evident through incidental public records that provide snapshots of how the group is spending its money. There are undoubtedly other expenses that have been channeled through its consulting firms to various other sub-vendors associated with all the other expenses that come with running a political group.
There is legitimate criticism to be leveled at the sort of subcontractor arrangement that the Lincoln Project employs. Political groups generally are not required to disclose such subcontractors in periodic FEC filings. That payment structure therefore serves to obscure potentially huge flows of money from those groups’ primary vendors to all the companies that they hire to actually carry out the work.
That can make it next to impossible for the public to discover if a campaign is using one of its vendors to surreptitiously pay family members, business associates, or other ethically problematic individuals. Indeed, when the Democratic National Committee hired the firm Fusion GPS to compile opposition research on Donald Trump during the 2016 campaign, resulting in the compilation of the infamous Steele Dossier, it paid Fusion as a sub-vendor of its law firm, thereby obscuring the eventual recipient of the payments in its FEC filings.
Such arrangements also make it more difficult to know whether or to what extent the primary vendors are taking a commission off the top. While it’s simply untrue that, as McDaniel put it, Lincoln Project expenditures are doing “nothing” but enriching its executives, it is entirely possible that Galen, Stelsow, and others involved with the group are being well compensated for their work—exactly how well is not knowable from the group’s FCC filings.
But hefty compensation is nothing unique in politics. Indeed, the Trump campaign’s own financial practices resemble those of the Lincoln Project in key ways, and have led to similar allegations of personal enrichment by its top officials—allegations that Team Trump has vehemently rejected.
Trump’s two presidential campaigns have paid tens of millions of dollars, for instance, to companies owned by or affiliated with Brad Parscale, who ran Trump’s digital program in 2016 and is now his campaign manager. Parscale didn’t simply pocket that money, he used it to place ads and conduct other forms of political work that advanced the campaign’s political objectives.
The practice nonetheless led to allegations of self-dealing, even within the Trump campaign itself. In interviews with federal investigators in 2017, former Trump campaign manager Corey Lewandowski griped that Parscale "was able to put $94 million of campaign money through his business" in an effort to “enrich” himself, according to an FBI summary of the interview.
The Trump campaign has strenuously pushed back on any allegations of self-dealing, but has also acknowledged the potential for a perceived conflict of interest. When CNN wrote a story last year on Parscale’s financial entanglements with the campaign, the RNC, and pro-Trump outside groups, a campaign spokesman said Parscale had stopped using his companies to place ad buys for the Trump reelect “to remove even the appearance of self-dealing."
There are a few hallmarks of a scam PAC. The most obvious one is the excessive payments to its own executives. But one key criterion is a group that engages in minimal or no actual political advocacy. Such groups often donate nothing to allied political campaigns, and spend nothing on paid media supporting or opposing candidates.
That’s the crucial metric: executives and consultants will of course be paid, sometimes exorbitantly, even in perfectly legitimate political operations. But are they being paid to actually advance a concrete political agenda, and are they doing so effectively? Or are they promising donors an effective, but fictional, political operation?
Say what you will about the Lincoln Project’s goals, or its insistence on identifying itself as a group of Republicans, even as it goes after not just Trump but GOP Senate candidates as well. It’s difficult to deny that it has been effective in its mission of damaging—or at least distracting—Donald Trump. And it’s influence only appears to be growing, in no small part thanks to its remarkable ability to spend relatively small amounts of money and still drive the president crazy.
Trump’s twitter tirade against the Lincoln Project’s brass and its ad earned it a ton of free media and additional attention. The version of the Mourning in America ad posted to Twitter has 5.7 million views. The one on YouTube has more than 1.7 million. On Facebook, another 945,000.
