Worried About Big Labor, Democracy Alliance Scrambles to Expand Fundraising

The left’s leading donor club can’t continue to rely on wealthy unions, president says

cash money
April 21, 2016

The left’s leading donor club is frantic at the prospect of Big Labor’s diminishing ability to finance its political operations and is scrambling to come up with new ways to raise money, internal documents obtained by the Washington Free Beacon reveal.

Democracy Alliance president Gara LaMarche warned attendees of the group’s donor conference in Santa Monica, California, last week that a reduction in labor union support would seriously damage the Alliance’s financial clout and the resources available to its portfolio of political and policy groups.

"Not all the resources we currently bring to bear are secure," LaMarche told conference attendees gathered at the ritzy Fairmont Miramar hotel.

A copy of his prepared remarks illustrates the challenges posed to prominent left-wing groups by laws that prohibit forced unionization in the workplace and limit unions’ abilities to spend members’ dues on political or policy advocacy.

LaMarche’s remarks also offer a glimpse of how Democrats and their allies are attempting to expand their fundraising operations by employing technology and tapping into previously ignored or underutilized sources of money.

The Democracy Alliance more than doubled the amount of money it raised for the groups in its core portfolio last year despite concerns about unions’ abilities to finance their operations.

It raised $75 million for those groups in 2015—the most it has ever raised, according to a chart included in LaMarche’s remarks—compared to $35 million in 2014. That core portfolio swelled from 21 to 34 organizations between 2014 and 2015.

Those organizations include prominent "dark money" nonprofit groups such as Media Matters for America and the Center for American Progress, Democratic political vendors such as data firm Catalist, and political action committees such as Progressive Majority.

The Democracy Alliance does not actually touch the money that it raises for those groups. Instead, it strategically vets and recommends organizations for support by its "partners," which must give at least $200,000 to portfolio groups every year in addition to $30,000 in DA dues.

The Alliance’s labor union partners include the Service Employees International Union; the Communications Workers of America; the American Federation of State, County, and Municipal Employees; the National Education Association; and the American Federation of Teachers.

According to LaMarche, DA portfolio groups continue to rely heavily on support from those unions, which accounted for 13 percent of all DA fundraising last year, and more than a quarter of all Alliance support for its new state-focused dark money initiatives.

The Alliance’s labor union partners "dodged a bullet," in LaMarche’s words, when the death of Supreme Court Justice Antonin Scalia left the court split on a landmark case challenging public sector unions’ abilities to compel the payment of dues that critics say force its members to subsidize political advocacy.

"They were all making contingency plans for the significant hits to their budgets that a defeat would have entailed," LaMarche said.

"Whether that defeat is put off for a year or for many years, we would be foolhardy to assume that we will always have the labor resources that have been such a significant engine for progressive politics and organizations," he warned.

Unions have been "a key anchor of funding for progressive campaigns and causes," LaMarche said, but the Alliance—and the larger progressive movement—need to find new ways to raise money to make up for the disastrous financial shortfall that could follow policies that prevent forced unionization and political participation by their members.

LaMarche floated a number of ideas in his remarks, including what would be a major step towards expanding the Alliance’s fundraising base. For the first time, he revealed, it is soliciting donations for its portfolio groups from non-partners—outside donors who are not bound by its giving requirements, but are approached about supporting one or more of its 34 core organizations.

"In the last few months I’ve been involved in raising six-figure gifts for the Inclusive Economy Fund from non-DA partners," LaMarche revealed, referring to an Alliance-backed dark money initiative that works on economic issues such as paid leave and minimum wage hikes.

"I believe, and have begun to discuss with the DA board and some Partners, that if we make an investment in the capacity to research and approach a wider range of donors, it will pay off in a stronger progressive movement, which is what we are all here for," LaMarche said.

That expansion of DA’s donor base would go hand-in-hand with regional fundraising efforts already underway. Those efforts have included "salons and receptions hosted by DA Partners," including one, LaMarche revealed, at the San Francisco home of billionaire Democratic donor Tom Steyer.

LaMarche also revealed the Alliance’s increasing focus on technology-driven fundraising tools. Five DA partners are currently developing what LaMarche described as "an on-line sustainable, universal progressive payment processing platform" that could facilitate donations to its member groups and collect analytics on those donations to further optimize its fundraising potential.

Another tool the Alliance may employ is called MyChange, a fundraising app that rounds up users’ credit card purchases to the nearest dollar and donates the difference to groups of their choice.

Though it has long focused on steering high-dollar donations to its supported groups, LaMarche said the Alliance will increasingly try to capture small- and medium-size financial support in the vein of Democratic presidential candidate Bernie Sanders’ grassroots fundraising operation.

To supplement those smaller contributions, LaMarche floated the idea of a "Multiplier Fund—an innovation fund to provide multi-state investment for small and medium donor prospecting, retention, and upgrading projects."

These new fundraising initiatives are in their infancy, but LaMarche stressed that the prospect of reduced labor union financing makes their development urgent.

"While these explorations and new initiatives won’t produce significant new sources of funding for three to five or more years, if we don’t work now to experiment or innovate these realms, we will forego critical sources of funding for the future."