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Biden is raising tens of millions of dollars for his inauguration but won’t say where the money is going

Business

Joe Biden

Summary List Placement

When Joe Biden becomes president Wednesday, it’ll be the high point of numerous inaugural festivities, most of them virtual or made-for-TV because of the pandemic. 

But as Biden raises tens of millions of dollars toward this celebration, including from corporate giants with big business before the federal government, his inaugural committee has so far refused to reveal how it’s spending its cash — despite touting a robust political money reform agenda heavy on enhanced transparency.

It’s a decision that’s irking several prominent progressive organizations. And they hope Biden will change his mind.

In the meantime, Biden’s decision means he’s keeping from public view information about who’s making money off his inauguration activities, such as consultants, operatives, and vendors. The public may also never know how the Biden inaugural committee spends any surplus cash it generates.

“We think the Biden inauguration committee should voluntarily disclose their spending and that Congress should propose legislation that would require full disclosure of inaugural committee spending,” said Jana Morgan, director of Declaration for American Democracy, a coalition of more than 170 good-government and left-leaning organizations that support a sweeping government ethics reform agenda.

The secrecy in Biden’s inaugural spending also coincides with separate and ongoing civil and criminal court cases involving President Donald Trump’s 2017 inauguration spending.

“We favor full disclosure,” said Patrick Burgwinkle, spokesperson for campaign finance reform group End Citizens United.

“We’re definitely hoping Biden opts to voluntarily disclose his inaugural spending,” said Carolyn Fiddler, communications director for liberal news and opinion website Daily Kos. “Biden’s made clear that his priorities for his presidency are progressive rather than corporate-serving.”

Biden Harris Inauguration

What the law requires — and doesn’t

Federal law does not require Biden’s inaugural committee to publicly disclose how it spends its cash. It only requires the committee to publicly submit information about its contributors — names, locations, dates of donation, contribution amounts — to the Federal Election Commission within 90 days of Inauguration Day. 

Already, Biden’s inauguration committee has voluntarily released the identities — if not the donation dates, full addresses, and contribution amounts — of its donors through early January. They include several large corporations and unions, such as Google, Microsoft, Boeing, Comcast, United Airlines, Yelp, and Qualcomm. 

Insider has since confirmed that Coca-Cola has also contributed. Together, such corporations spend tens of millions of dollars annually lobbying the federal government and many are government contractors.

Biden’s inauguration committee is also voluntarily rejecting some forms of money. Among them: contributions from registered federal lobbyists, registered foreign lobbying agents, fossil fuel companies and fossil fuel company executives and political action committees.

“But there’s nothing stopping the Biden inauguration from adopting further limits and transparency measures,” noted Brendan Fischer, director of federal reform for the nonpartisan Campaign Legal Center.

Biden indeed could voluntarily release most any information he wants — including spending details — concerning the finances of his inaugural committee, which is organized as a nonprofit 501(c)(4) “social welfare” corporation.

Biden’s inaugural committee is funding five day’s worth of programs, including musical performances, celebrity appearances, speeches, and the like. His inaugural committee is not responsible for paying the cost of the swearing-in ceremony — and what will be unprecedented security at Biden’s inauguration in light of the January 6 attack by Trump supporters on the US Capitol. The federal government, along with state and local governments, will foot those bills.

Read more: Biden’s inauguration day will be unlike any other in history. Here’s what to expect.

Biden’s inauguration team declined to answer several Insider questions about its spending, including whether it will go beyond what’s required by law and publicly disclose the identity of its payees and the dollar amounts of any payment it makes.  

The inaugural committee also refused to confirm whether Biden supports changes in federal law requiring his or any presidential inaugural committee to publicly disclose spending information.

A committee spokesperson instead told Insider in a statement that it “will comply with FEC disclosure laws” and publicly report the value of donations it receives.

Biden’s presidential campaign platform, released in 2020 while he was still running for president, expressed enthusiasm for political transparency.

“The next president must demonstrate with their actions — not empty words — that public servants serve all Americans, not themselves or narrow special interests,” Biden’s platform reads. “We also must strengthen our laws to ensure that no future president can ever again use the office for personal gain. The federal government’s power must be used to better the country, and not in service of narrow, private interests.” 

Obama-Biden inaugural 2013

Biden’s ‘dark side’

Several government reform organizations expressed concern that Biden’s inaugural committee could, without the public ever knowing, spend millions of dollars on services from politically connected vendors or cutting sweetheart deals to campaign supporters.

“The Biden inaugural should err on the side of transparency,” said Robert Maguire, research director for the nonpartisan watchdog group Citizens for Responsibility and Ethics in Washington. “I have trouble seeing what’s the downside for them. Just give us information so Americans can have faith that inauguration money is being spent on the inauguration.”  

Meanwhile, if Biden’s inaugural committee finds itself with leftover cash — a distinct possibility given the scaled-down scope of 2021 inauguration activities because of the COVID-19 pandemic and security concerns in Washington, DC — it also has several options for how to divest it.

It could, for example, give the money to any charitable cause it chooses such as cancer research, food banks, or nonprofit COVID-19 relief efforts.  

But as a 501(c)(4) nonprofit, the Biden inaugural committee could also legally contribute money to, say, a liberal super PAC, which in turn could advocate for the election of Democratic political candidates and the defeat of Republican candidates.

It could also give money to another — and politically active — 501(c)(4) nonprofit group that trades in what’s known as “dark money.” Easily defined, “dark money” is political cash that can’t be traced back to its root source.

Read more: Biden’s ‘dark’ side: How Democrats are embracing secret money and the Citizens United decision to defeat Trump

Biden’s 2020 presidential campaign against President Donald Trump benefited greatly from “dark money,” according to an Insider analysis of federal campaign finance records.

In several cases, 501(c)(4) nonprofits that didn’t publicly disclose their donors — most notably, the Sixteen Thirty Fund — contributed millions or tens of millions of dollars to pro-Biden super PACs. 

In turn, those super PACs sponsored massive advertising campaigns either promoting Biden or trashing Trump, and voters never knew who was truly bankrolling these efforts.

Changes to the law?

The Democrat-controlled US House of Representatives has already re-upped HR 1, a wide-ranging government ethics and political finance bill first introduced in the last congressional session, which includes significant changes to presidential inauguration funding. 

Contributions, for one, would be capped at $50,000 and publicly disclosed 24 hours after receipt. Inaugural committees would also be required to publicly disclose any disbursement it makes — along with the disbursement’s purpose.

“There would be far less mystery and opacity about how inaugural committees spend their money if Congress made a new law to bring more transparency to these political groups, and the easiest place to start is treating inaugural committees like campaign committees for disclosure purposes,” said Danielle Caputo, legislative and programs counsel for bipartisan government reform nonprofit Issue One.

And while Biden should just disclose spending information voluntarily, said Beth Rotman, national director of money in politics and ethics for Common Cause, “it would also be great if Congress made this law.

“But democracy reform is really hard,” Rotman added. “You’re asking politicians to give up a lot of control, and these are not easy fights to win.”

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