The real reason the NRA wins

Senior Columnist
Yahoo Finance

To its many critics, the National Rifle Association is a bottomless source of funds able to buy off politicians everywhere in order to protect gun rights.

In reality, the NRA is a medium-sized interest group that is undoubtedly influential, but is nowhere near the biggest spender in politics. Its ability to stave off gun-control laws in the aftermath of school massacres may have more to do with its effectiveness as an advocacy group, honed over decades, than with the amount of money it spends.

The NRA has one other advantage: The opposition is poorly funded. While polls show Americans generally favor stricter gun laws—and outrage seems to be mounting following the February 14 mass murder at a Florida high school—that hasn’t generated a spending surge on gun-control candidates. In the 2016 election cycle, the NRA outspent the leading gun-control group, Americans for Responsible Solutions, by at least 4-to-1—and possibly by much more. Among advocacy groups that tend to support Democrats and liberal causes, the big money goes toward environmental issues and women’s rights, not gun control.

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The National Rifle Association, founded in 1871, in a nonprofit group with annual revenue of around $400 million. That might sound like a lot, but if it were a public company, the NRA would be much smaller than any firm listed on the S&P 500 stock index.

Its CEO, Wayne LaPierre, gets paid like a big-league boss, however. In 2015, the last year for which the group’s tax return is available, LaPierre earned $5.1 million in total compensation. That’s more than the CEOs of Alaska Air, CME Group, Church & Dwight, Dish Network or Garmin earned that year.

Feb. 22, 2018 file photo. National Rifle Association Executive Vice President and CEO Wayne LaPierre, speaks at the Conservative Political Action Conference (CPAC), at National Harbor, Md. (AP Photo/Jacquelyn Martin, File)
Feb. 22, 2018 file photo. National Rifle Association Executive Vice President and CEO Wayne LaPierre, speaks at the Conservative Political Action Conference (CPAC), at National Harbor, Md. (AP Photo/Jacquelyn Martin, File)

The NRA’s political spending takes two forms: money spent on lobbying, and money spent on elections, whether direct donations to candidates or spending on their behalf through a political-action committee. The NRA spent $5.1 million on lobbying in 2017, according to the Center for Responsive Politics. That wasn’t nearly enough to crack the top 20.

The biggest lobbying group, the U.S. Chamber of Commerce, spent $82 million last year, or 16 times what the NRA spent. Granted, the U.S. Chamber is corporate America’s biggest backer in Washington, funded by many of the nation’s largest companies. Unlike the NRA, it lobbies on a broad range of issues. But several individual companies, including Oracle, Amazon and Comcast, all spent at least twice as much as the NRA on lobbying. Blue Cross/Blue Shield spent nearly five times as much.

The NRA spends a lot more on elections—at least $54 million during the 2016 cycle, including $30 million on ads and other activities that either supported Donald Trump or trashed his opponent, Hillary Clinton. That made the NRA the ninth biggest outside-spending organization. Still, dwarfing that tally were two Democratic groups at the top of the list, Priorities USA (which spent $133 million on Democratic candidates) and the Democratic Senatorial Campaign Committee ($104 million). NextGen Climate Action, funded largely by California billionaire Tom Steyer, spent $96 million on Democratic candidates who support efforts to combat climate change. There is no gun-control PAC or super PAC funded anywhere nearly that generously.

The NRA may spend considerably more on political efforts than campaign finance reports suggest. According to an internal audit of its 2016 finances, the group spent $84 million in 2016 on “legislative programs,” and $55 million on “public affairs,” or $139 million in total. That’s how the NRA defines its spending, which could be broader than what  federal disclosure rules require. Required disclosure forms show spending of $5.1 million on lobbying and $54 million on elections, or $59.1 million total. So if the group’s annual political spending is really around $139 million, that’s more than twice what it reported publicly for the entire 2015-2016 cycle. (Other groups may underreport in a similar way.)

The NRA also has the dubious distinction of being the biggest “dark money” spender in American politics, which means part of its apparatus is organized in a form that doesn’t require the group to disclose where the money comes from. About $35 million of its $54 million in election spending in 2016 came from the NRA Institute for Legislative Action, which is allowed to keep donations secret. Those could come from gun companies, ammunitions manufacturers, hunters’ groups or anybody else. Through an unrelated tax filing, the Center for Responsive Politics did uncover a $4.9 million donation to the group in 2014 from the Freedom Partners Chamber of Commerce, a conservative group funded by the billionaire Koch Brothers.

The other $19 million in election spending in 2016 came from the NRA Political Victory Fund, which is a different kind of political organization that does list donors publicly.

The NRA’s biggest source of income—$164 million in 2016—was dues paid by its roughly 5 million members, which start at $30 per year. “Contributions,” which presumably include money donated to the group’s political-action committees, brought in another $104 million in 2016. Much smaller revenue sources include advertising in magazines the NRA owns, such as American Rifleman, and fees earned from shows and programs the group runs.

Political activities appear to be one of the biggest single expenditure categories for the NRA. But it also spends $88 million on member services, $38 million on publications, $19 million running shows and exhibits, and $11 million on gun training and education. Fundraising cost the group $47 million in 2016.

Revenue from dues and fees fell slightly from 2015 to 2016, perhaps reflecting modest declines in membership. But the amount of political contributions soared, most likely because it was an election year. There’s good reason to think they’ll keep going up.

Confidential tip line: rickjnewman@yahoo.com. Encrypted communication available.

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Rick Newman is the author of four books, including Rebounders: How Winners Pivot from Setback to Success. Follow him on Twitter: @rickjnewman

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