By Dan Froomkin
One thing's for certain about most of the biggest donors bankrolling the main pro-Mitt Romney super PAC: They are canny investors.
Private equity or hedge fund moguls make up more than half of the top donors to Restore Our Future -- the PAC created by former Romney aides to supplement his official campaign with unlimited contributions. Six of them have given $1 million or more each.
The size of their checks, however, is dwarfed by what's at stake for them in November. There may be no other group whose future earnings are more in play, especially should President Barack Obama and congressional Democrats pursue their tax agenda more aggressively and effectively in a second Obama term.
If things don't go their way, they could be hard hit by increased taxes on the rich, a higher tax rate on investment income, and regulations that could expose their secrets and limit their leverage.
Most likely of all, however, they could see a sustained attack on one of the most blatant and exclusive loopholes in the tax code -- something called "carried interest" -- that happens to save them billions of dollars a year.
The loophole allows certain kinds of financiers, including private equity investors and some hedge fund managers, to treat what would in ordinary circumstances be considered a performance bonus as long-term investment income -- taxable at the maximum 15 percent capital gains rate instead of the 35 percent maximum for labor income.
Per capita, it may be the biggest giveaway for the fewest people in the entire tax code. And Romney is a poster child for it. Carried interest is the main reason that he so famously was able to end up paying 13.9 percent in taxes on his $21.7 million income in 2010. Much of that income came from performance bonuses still trickling in from private-equity investments he managed during his career at Bain Capital.
Other estimates have the proposal increasing tax revenues even more -- perhaps by as much as $10 billion a year.
There used to be rules, of course, barring people who have billions at stake from spending millions to influence elections. But the Supreme Court, and a subsequent lower court ruling, effectively struck them down two years ago, legalizing unlimited contributions -- even on behalf of specific candidates -- as long as the political operatives in charge promise not to coordinate their spending with the campaigns.
And as a result, what has always been a disproportionate ability of the rich to buy influence has now gone into overdrive -- even creating the possibility that a handful of super-investors could actually corner the market.
Fred Wertheimer, president of Democracy 21, a group that supports strict campaign finance limits, says the preponderance of high-flying financiers funding the pro-Romney super PAC demonstrates how the Supreme Court's 2010 Citizens United decision "created precisely the inherently corrupt system earlier Court decisions warned about with direct contributions."
"You have lots of donors seeing this as a huge opportunity to purchase influence with the candidate if the candidate wins," Wertheimer said.
"The super-rich have huge economic stakes in government decisions," he continued. "There's a very legitimate argument to be made that one of their principal economic interests is maintaining the unjustifiable tax advantage they get in hedge fund activities."
Brittany Gross, a spokeswoman for Restore Our Future, said the super PAC does not comment on its donors.
There may also be more amorphous reasons why Wall Street titans would line up behind a pro-Romney super PAC: namely because he's one of their own.
"They have a friend in Romney," said Victor Fleischer, a law professor at the University of Colorado.
"I see it as about what you think normal is," Fleischer added. For instance, "Romney thinks it's perfectly normal to pay 15 percent on your labor income."
"It's not that I fear these guys are going to pick up the phone and tell Romney what to do," Fleischer said. That's because "Romney's going to do what they want him to do" without any prompting.
And they may also be counting on the idea that Romney will treat them more respectfully.
"They're already rich," said Leonard Steinhorn, a professor of political communication at American University. "I think their egos are hurting far more than anything else."
"This was a cohort that saw themselves as the whiz kids during the '90s and aughts," Steinhorn said. They were rewarded with huge bonuses, applauded for their creativity, credited for big deals and a booming economy.
But then, when the economy crashed, the public recognized that their excesses were a major contributing factor -- and Obama, even while treating them gently, sometimes had harsh words for them.
"These people like to be flattered," Steinhorn said. In Romney, "they're making an investment in somebody who will be very sympathetic, who sees capital -- and only capital -- as the engine of growth in our country."
What they're hoping to get for their trouble, Steinhorn said, is "a president who will praise them and laud them and put them on a pedestal and tell people that they're the ones who are making America grow and making it rich."
Romney's campaign did not respond to a request for comment.
Fraser P. Seitel, a spokesman for the super PAC's top donor, billionaire Julian Robertson, told The Huffington Post that Robertson's motives have nothing to do with personal gain.
Robertson, who founded one of the country's earliest hedge funds, Tiger Management, maxed out on how much he could legally give Romney's campaign directly -- and then gave the super PAC $1.25 million more.
"He happens to believe that Mitt Romney would make the best president at this moment, because of his experience in business and his experience as a manager, and his knowledge of the economy," Seitel said.
Robertson has been retired and focused on philanthropy and his own investments for more than 10 years, Seitel added. He is a major donor to environmental causes. "He really does believe sincerely that Romney would be the best president -- for all the right reasons," Seitel said.
And the donation has nothing to do with buying access either, Seitel said. "People return his calls anyway."