Unprecedented: Obama Campaign to Turn Itself into Non-Profit

Never in U.S. history has a sitting president morphed his campaign team into a tax-exempt nonprofit designed to use its voter databases to ramrod a president’s legislative agenda. Until now.

On Friday, First Lady Michelle Obama said the Obama campaign, officially known as Obama for America, will soon be turned into a 501 (c) 4 social welfare non-profit called Organizing For Action that can raise unlimited donations and will become “the next phase of our movement for change.” Former Obama campaign manager Jim Messina will become the group’s chairman of the board, Obama campaign strategist David Axelrod will be a consultant, and Obama media strategist David Plouffe will join the group once he exits the White House. 

According to Politico, the group claims it will disclose its donors and not take money from lobbyists or political action committees (PACs), but will take unlimited money from corporations.

“It’s ironic and puzzling that a grassroots organization with a public interest agenda is going to take unlimited corporate money. It doesn’t square,” said Mary Boyle of Common Cause. “There’s one reason that corporations spends money on politics–they’re looking for something in return.”

In 2008, President Obama refused to take corporate cash to fund his inaugural. In 2012, he reversed that decision, having recently accepted a $250,000 check from ExxonMobil. The fact a sitting president’s former campaign team will be accepting corporate donations, to some, smacks of a double-standard that invites cronyism. Adam Green, co-founder of the Progressive Change Campaign Committee, blasted the decision: 

“They won’t take money from MoveOn, Democracy for America, or Progressive Change Campaign Committee PACs, but will accept million-dollar checks from Bank of America and Goldman Sachs? What’s the principle there? No big bank or corporation will donate million-dollar checks to OFA without the expectation that it will impact which issues they engage on, and that’s very troubling,” Green said.

One of the driving reasons the Obama campaign is turning itself into a tax-exempt non-profit is to maintain the team of tech wizards the campaign assembled to build its massive data mining and targeting apparatus.   “No existing group has the technical resources to manage the data,” writes Natalie Jennings of the Washington Post. "If we can take the enthusiasm and passion that people showed throughout the campaign and channel it into the work ahead of us, we will be unstoppable," said Organizing For Action Board Chairman Jim Messina.

By law, 501 (c) 4 non-profits like Organizing For Action do not have to disclose their donors or the amounts donated. In the past, Messina has blasted conservative 501 (c) 4 organizations as shadowy, secret money groups backed by anonymous donors and corporate interests. In a June email, Messina said:

“They have a vested interest in being able to spend millions anonymously to influence our elections—many of the corporations and individuals funding their organizations don’t want their agendas to receive scrutiny from the press or the public We can make sure they don’t get away with hiding these donors—or their agendas. But it’s going to take a lot of us standing up, putting our foot down, and saying ‘Hell no.’”

First Lady Michelle Obama cut a video to promote the Obama’s campaign’s decision to turn itself into a 501 (c) 4 nonprofit and explained why citizens should get involved. 

“I often think back to one of my first dates with Barack, all those years ago,” said Mrs. Obama. “Back then, he spoke to me about the world as it is and the world as it should be and our obligation to bridge that divide.  The work you’ve done has brought us so much closer to the world as it should be. But we aren’t there yet…So I hope you will join Organizing For Action.”


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