Party Foul: Inside the Rise of Spies, Mercenaries, and Billionaire Moneymen

Why parties no longer control American politics

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Lexey Swall for TIME

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Inside, the place has the vibe of an underfunded startup, with a cubicle farm of young researchers in denim. One Friday in January, the staff erupted in applause as executive director Tim Miller awarded a Hello Kitty--themed Chia Pet to the 20-something who unearthed a 2011 clip of embattled Democratic Senator Kay Hagan beaming alongside Barack Obama--a damaging visual in North Carolina, where Obama's approval rating hovers around 40%. The hit drove negative headlines for 24 hours. "With complete information awareness," Miller says later, "we can define and destroy Democrats in 2014 and beyond."

America Rising is run by three blue-chip GOP operatives. Miller and president Joe Pounder are refugees from the Republican National Committee, and the third, Matt Rhoades, managed Mitt Romney's 2012 presidential campaign. Last April, they decided to ditch the party bureaucracy to open a firm unregulated by the Federal Election Commission. The benefit is that they aren't forced to disclose their donors or intentions and can take money from anybody. They can also make a tidy profit. "We can work with the whole constellation of GOP and conservative groups," Pounder says.

America Rising is just one part of the external infrastructure supporting Republicans. A new network of groups that cater to the Tea Party grassroots has been locked in a fight to control the party's direction with a web of organizations that hail from its Establishment wing. Moderate Republican groups like the Chamber of Commerce are mounting an unprecedented campaign to target insurgent conservatives in 2014 GOP primaries. "Some of these outside groups will spend more money in a month than all three of the party committees combined" in 2014, says Reed of the Chamber, which is expected to spend $50 million in the primaries.

On the Democratic side, a similar shift has occurred, though without the brutal civil war. At the end of 2013, the five top-grossing super PACs, which can raise and spend unlimited money on politics, all backed Democrats. Ostensibly independent, these groups will fund much of the TV advertising in the 2014 elections.

Ready for Hillary, an independent grassroots group that already claims more than 33,000 supporters, has rented Clinton's 2008 campaign mailing list to freshen it up for her potential campaign. It has also armed itself with Big Data tools from Catalist, a company funded by billionaire George Soros among others, which has long served Democratic campaigns. Priorities USA, a super PAC created in 2011 to secure Obama's re-election, is now devoted to making Clinton his successor. American Bridge 21st Century, a Democratic super PAC formed to sink Republican candidates--and upon which America Rising is modeled--launched an outfit called Correct the Record just to parry anti-Clinton attacks.

The growing clout of these outside groups has changed the behavior of candidates as well. Instead of courting party chairmen or local bigwigs, would-be Congressmen make pilgrimages to Washington to visit the private operators who can sway activists back home.

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