Crypto billionaire and pro-Israel PACs, not the candidates, are top spenders in NC race
Led by pro-Israel lobbyists and a 30-year-old Bitcoin billionaire, outside groups have been spending more money than the candidates themselves in a hotly contested Triangle primary election, which will likely determine who next represents Durham and Chapel Hill in Congress.
The candidates are spending, too. But their campaigns have been eclipsed by two super political action committees that are both supporting the same candidate: Valerie Foushee, a state senator from Hillsborough. With less than two weeks before Election Day on May 17, Foushee has amassed $2.4 million in super PAC support.
She’s one of eight Democrats seeking their party’s nomination. If all eight pooled every dollar their campaigns have reported raising so far, they still wouldn’t have as much money as what those two outside groups have spent on pro-Foushee TV ads and mailers, an analysis by The News & Observer shows.
Primaries are rarely so competitive and expensive. But incumbent Democratic Rep. David Price is retiring, and whoever wins the Democratic primary for this deep-blue 4th district is almost certain to win the general election and head to the U.S. House of Representatives.
One of the pro-Foushee super PACs, called Protect Our Future, is largely funded by 30-year-old billionaire Sam Bankman-Fried from California who made his fortune in cryptocurrencies like Bitcoin. The other is connected to AIPAC, a pro-Israel lobbying group on Capitol Hill.
So much money pouring in for one candidate is now drawing criticism from Foushee’s opponents.
“I think we’re all deeply disheartened that ... crypto-billionaires have taken an outsized voice and power in this election,” said Taylor Bollhagen, spokesman for Clay Aiken, the American Idol star and Raleigh native who’s hoping to become the first openly LGBT member of Congress from North Carolina.
A spokesperson for Protect Our Future told The N&O that support for crypocurrency doesn’t factor into whom the the PAC backs, and that they are focused on “electing champions for pandemic prevention in Congress.”
Foushee is one of three frontrunners in the race, along with Aiken and Durham County Commissioner Nida Allam. Allam is most aligned with progressive voters, while Foushee is the favorite of the party establishment.
Foushee’s campaign manager, Anna Nunn, said Foushee “is one of dozens of progressive candidates and elected officials” supported by AIPAC.
“The Jewish community in particular has long been a friend to the African-American community, marching arm-in-arm with Dr. King and other Black leaders during the civil rights movement,” Nunn said in a written statement.
By the money
Even ignoring the super PAC money, Foushee has been the biggest spender in the race and the second-biggest total fundraiser. But again, outside money is in play: Most of the money her campaign has raised was routed through AIPAC, in a process known as bundling.
Bundling is a tactic where lobbyists or others direct their supporters’ individual contributions to specific candidates. Unlike super PAC funding, bundled money goes directly to the campaign, so the candidate can control how it’s spent.
In addition to the nearly $1.5 million that AIPAC’s super PAC, known as the United Democracy Project, has spent on ads backing Foushee, AIPAC’s bundling was also responsible for 54% of the $800,000 her campaign had raised as of late April.
The N&O previously reported that Foushee’s campaign received $165,000 in bundled AIPAC donations in the first three months of the year, which caused an outcry in progressive circles in the district. On Thursday a new federal filing showed AIPAC has since ramped up its bundling, with an additional $268,000 in April.
In all, between the donor bundling and the super PAC spending, AIPAC has spent nearly $2 million on Foushee. The other super PAC active in the race, Protect Our Future, has spent nearly $1 million more backing her.
Bankman-Fried, the Protect Our Future founder, is worth an estimated $24 billion. In 2020 he was Democratic President Joe Biden’s second-biggest donor and since then has spent millions more backing numerous politicians — both with personal checks and through Protect Our Future, NBC reported — including Republican senators like North Carolina’s Richard Burr and Utah’s Mitt Romney, as well as Democratic hopefuls like Foushee.
Why are super PACs helpful?
In the NC-04 primary, records from the Federal Communications Commission reviewed by The N&O show just how much the outside groups have been able to dominate the airwaves in recent weeks.
On WRAL, the local NBC affilliate, FCC records show the two pro-Foushee super PACs have spent nearly $1 million buying ads on just that one channel.
By contrast, Foushee’s campaign itself has paid for just $8,800 worth of ads on the channel, Aiken’s campaign has spent $19,775 and Allam has spent $33,525. Similar patterns show up in the reports for other local channels like WTVD, WNCN and WRAZ.
While super PACs can’t directly coordinate with campaigns on ads and messaging, they can take unlimited amounts of money from donors, so they’re often better funded than campaigns. Plus, while campaigns have to spend money on other costs like consultants, staffers, software, food, gas, office supplies and everything else it takes to run a campaign, super PACs can focus entirely on ads.
In total the two super PACs have spent $2.4 million backing Foushee. One of them is also active in a Democratic primary in the state’s northeastern NC-01 district, supporting Don Davis for the party’s nomination.
Davis, like Foushee, is facing a more progressive challenger — Erica Smith, who has tried to make Davis’ more moderate abortion stance a key issue in that primary.
Protect Our Future, the super PAC with crypto backing, spent $920,000 on pro-Foushee ads and mailers in the last few weeks. The United Democracy Project, the super PAC with AIPAC backing, has spent around $1.5 million each on both Foushee and Davis, who are both currently state senators.
And while Davis has made a name for himself at the state legislature as a more centrist rural Democrat, in the Durham-Chapel Hill district it’s a race to the left.
“Senator Foushee has spent her entire life fighting for progressive values, including women’s reproductive rights, voting rights, environmental justice, climate action, access to affordable healthcare and equity in education,” Nunn said.
Allam campaign spokesperson Bill Neidhardt touted Allam’s support and endorsements including from unions, saying she is “proud to reject donations from billionaires and corporate PACs.”
Asher Hildebrand, a Duke University professor and former chief of staff for the retiring Price, said the primary is “kind of a microcosm of debates over the future of the Democratic Party,” citing the generational and stylistic differences between Foushee and Allam. Foushee comes from a long tradition of public service and is a more mainstream Democrat, he said.
“Allam represents not just a more progressive part of the coalition but also a younger, less patient, less willing to play by the rules part of the electorate,” Hildebrand said. Allam’s endorsements include Bernie Sanders, Elizabeth Warren and some members of progressive Democrats known as “The Squad” who support policies like the Green New Deal.
“People are impatient, are fed up and don’t want to go path of least resistance — and Allam appeals to those folks,” Hildebrand said.
Protect Our Future PAC money
Protect Our Future PAC says candidates’ stances on cryptocurrency have nothing to do with its support, and that it instead backs candidates with “long term view on policy planning especially as it relates to pandemic preparedness and prevention.”
They’re running a television advertisement about Foushee that mentions voting rights, abortion, Medicaid expansion and other popular Democratic stances.
“Protect Our Future endorses and invests in Democratic candidates who have their eyes on our future, not just our present — who have demonstrated they’re committed to prioritizing the issues that will safeguard our nation from the consequences of challenges like a future global pandemic,” Michael Sadowsky, president of Protect Our Future, told the N&O in a statement.
“Valerie Foushee has demonstrated strong leadership in the wake of extraordinary times while serving in the state senate and supporting the delivery of Covid-19 relief to the people of North Carolina,” he said.
“On the campaign trail, she has committed to ensuring that our federal agencies have the tools they need to prepare and prevent another pandemic should she serve in Congress. We’re confident Valerie Foushee will be the champion we need to fight today for solutions to the problems of tomorrow.”
Foushee, along with the entire General Assembly, has allocated billions of dollars in federal COVID-19 pandemic relief in multiple spending bills over the past two years. She is the only candidate in NC-04 who serves in the legislature.
A Protect Our Future spokesperson also said the PAC supports Foushee for her efforts around “environmental racism,” meaning the history of locating environmentally damaging disposal sites in communities of color. The PAC cited Foushee’s time on the Orange County Board of Commissioners, during which the county landfill was closed.
A PAC spokesperson said Protect Our Future found out about Foushee’s candidacy and record from Democratic operatives in North Carolina.
Seat decided in the primary
And while Foushee appears to be the only candidate with outside super PAC support, she’s not the only one being backed by special interest groups. Aiken and Allam both have PAC support as well — Aiken from a pro-LGBT group and Allam from an Indian-American group — although their funding is far less.
Allam is the first Muslim woman elected to office in North Carolina. Her parents first immigrated to Canada from India and Pakistan, then moved to North Carolina when Allam was a child.
Both Allam and Aiken’s campaigns have criticized Foushee’s outside support. But big money flowing into a campaign a few weeks from the primary, with early voting already started, might not impact voting decisions.
“I’m curious how far out from Election Day people are undecided,” said Deondra Rose, an associate professor of politics and history at Duke.
Hildebrand said that television advertisements are still effective in reaching voters, but not as much as knocking on someone’s door or “peer-to-peer” texting to encourage support for candidates.
He said that ads aren’t going to be talking about Israel or cryptocurrency, and the source of ad money might not break through to voters, even if it should.
There are also five other candidates in the Democratic primary, and Ashley Ward is one counting on her grassroots efforts instead of big donors, calling her campaign “people-powered.”
“I made the decision early on to not accept or even apply for the endorsement or financial support from organizations that don’t share my values,” Ward said in a campaign email. “This is almost a catch 22. It also means those organizations whose values I do share may not endorse me because I haven’t raised as much money as the top fundraisers. I can honestly claim that this is a true grassroots campaign, fueled by the donors who can vote in this district.”
“Together we can overcome the system that rewards big money interventions in campaigns as opposed to qualified candidates focused on the issues,” Ward told supporters.
This story was originally published May 7, 2022 at 8:00 AM with the headline "Crypto billionaire and pro-Israel PACs, not the candidates, are top spenders in NC race."
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