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The Democratic establishment might have avoided disaster — but it’s still in danger

(CNN) — The political season some have christened as “hot DSA summer” is lurching to an awfully eventful close.

Just a week after a momentous but surprisingly tight primary victory for Michigan Democratic Senate candidate Abdul El-Sayed (who doesn’t actually identify as a democratic socialist but shares the movement’s sensibilities), democratic socialist Francesca Hong narrowly lost in the Wisconsin governor’s primary Tuesday in a bit of a shocker.

The latter result is being greeted with a sigh of relief from the Democratic establishment, which feared Hong torpedoing their chances in an important state.

But that doesn’t mean the party is out of the woods or that this dynamic is going anywhere.

The totality of the results this summer suggests democratic socialists remain ascendant and could still cause the party problems as it seeks to flip the House and Senate this year. But Democratic voters have shown an ability to recognize and respond to that potential danger.

Let’s recap what we’ve learned.

Democratic socialists are clearly ascendant. But they’re still a small piece.

It’s possible to oversell just how ascendant and significant this wing of the party is. But it’s clearly gaining steam.

A year after Zohran Mamdani’s big win in the New York City mayor’s race, we’ve seen:

  • Democratic socialists defeat three incumbent House members – in New York, Colorado and last week in Michigan.
  • They also won a handful of other primaries, meaning the DSA contingent in the next Congress, while still in the single digits, will likely be bigger than ever.
  • They’re on course to add Washington, DC, and possibly Los Angeles to their mayorships in New York City and Seattle.
  • El-Sayed’s nomination and former DSA member William Lawrence’s primary win in Michigan’s battleground 7th Congressional District give this wing of the Democratic Party a rare proving ground outside of deep-blue urban areas.

Oh, and don’t forget that some democratic socialist lawmakers appear to be among the party’s bright shining stars. Mamdani’s stock is pretty high right now, Bernie Sanders remains quite popular nationally, and everyone is waiting for Alexandria Ocasio-Cortez’s next big political move – whether that be running for Senate or even for president.

Democratic voters showed they’re still pragmatic

Plenty of people have asked why El-Sayed and Hong – both of whom were considered favorites in their primaries – wound up in nail-biters.

One likely contributing factor: Democratic voters are more pragmatic and strategic than people give them credit for. It’s quite possible that the national party’s worries about nominating El-Sayed and Hong registered with voters late in the race.

There would seem to be a reason, after all, that the party hasn’t previously nominated candidates like El-Sayed in swing races.

Republicans have nominated a bunch of extreme and problematic Senate and gubernatorial candidates that cost them in recent years – think: Doug Mastriano, Todd Akin, Richard Mourdock, Sharron Angle, Mark Robinson – but Democrats really haven’t had those kinds of problems.

In fact, they seemed to balk at Elizabeth Warren early in the 2020 Democratic presidential primaries after polling showed her performing worse against President Donald Trump than other Democrats.

The tightness of the race in Wisconsin, meanwhile, suggested that supporters of non-Hong candidates coalesced behind the more-moderate Milwaukee County executive David Crowley at the very end.

So maybe these kinds of candidates have a better chance today than they used to, but Democratic voters still value electability.

There is still danger in this trend for Democrats

Just because Hong lost doesn’t mean the danger is behind Democrats. She might have been a more problematic nominee than El-Sayed, but we still don’t know how a candidate like El-Sayed will play in a battleground state.

And voters could start out skeptical.

A recent poll shows Americans viewed DSA unfavorably by a 36%-18% margin. Another showed just 38% of Americans preferred more socialism. And yet another showed 50% of voters said they would be less likely to vote for a self-described democratic socialist, while just 32% would be more likely.

Again, El-Sayed doesn’t label himself a democratic socialist. But he’s left-wing enough that these numbers are instructive.

How he performs in November will say a lot about how comfortable Democratic voters will be with nominating candidates like him in competitive races moving forward.

If he wins, it’s a big moment for the left. If he loses, it could be an even bigger setback for the movement – and cost Democrats the Senate majority.

(Indeed, some on the far-left appeared wary of nominating Hong for fear of how her performance might ultimately reflect on them. Very few high-profile left-wingers publicly supported her.)

Left-wing voters are mobilized, but so are other Democrats

Regardless of who won Tuesday, it shouldn’t escape notice that nearly 800,000 voters participated in the Wisconsin Democratic gubernatorial primary.

That’s about 100,000 more than turned out for the GOP gubernatorial primary in 2022, and it’s about 250,000 more than turned out for the last competitive Democratic gubernatorial primary, in 2018.

The 310,000-plus votes that Hong got was a lot for a democratic socialist candidate; indeed, it would have won pretty much any competitive primary for that office. But the current political environment is also turning out huge numbers of more mainstream Democratic voters.

And it’s not just Wisconsin. A CNN analysis last month showed Democratic primary turnout surging far beyond the last two midterms and far surpassing GOP turnout. Minnesota just set a primary turnout record, and it was overwhelmingly on the Democratic side – with about 700,000 votes in that primary, compared to about 400,000 on the GOP side, even as both featured competitive contests.

The key for Democrats now is in keeping both sides of the party mobilized, even if there might be hard feelings about who made it to the general election.

The-CNN-Wire
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IRS proposal would force nonprofits to disclose leaders’ terrorism convictions

Washington — The Trump administration is weighing a proposal to require nonprofits to disclose in their annual tax filings whether their top officials have been convicted of certain financial or terrorism-related crimes, sources with direct knowledge of the matter told CBS News.The IRS disclosure requirement would be added to the Form 990, the annual return that nonprofit groups file with the agency, said the sources, who spoke on the condition of anonymity because they were not authorized to talk publicly. Federal officials have viewed it as an effort to pressure tax-exempt groups to cut ties with people who have such criminal records and ensure that donors can make informed decisions about how to best direct their money, the sources said.Convictions that would have to be reported include providing material support to terrorists, fraud, money laundering, securities fraud, tax evasion, theft and civil judgments from Securities and Exchange Commission or state securities regulators' enforcement actions.The IRS proposal would not force groups to identify which officer, director or trustee was convicted, according to the sources. It is not a violation of federal law for people with felony convictions to serve on a nonprofit board.The proposal is expected to relate to convictions that occurred within the last 10 years. Nothing has been finalized, and it is one of at least two proposed revisions to the Form 990 moving through the Treasury Department and the IRS. Another proposal announced in April would impose new disclosure requirements for nonprofits that receive government funding. "No one has a right to privacy of their criminal record," said Tom Jones, an ally of President Trump who leads the conservative American Accountability Foundation nonprofit. "If your board members are convicted criminals, I am hard pressed to understand why you have a problem with that being publicized. You should have to explain why those people are on your board."A spokesperson for the Treasury Department said that it is considering "a range of measures to strengthen accountability for nonprofit organizations" and that the agency "will continue to follow the money to ensure tax-exempt status is not exploited to facilitate illicit activity."Inside the IRS, some officials have privately raised concerns about the conviction-related proposal and what the agency could lawfully do with the information — as well as questioned how it relates to enforcement of tax laws, multiple sources familiar with the conversations told CBS News. These IRS officials have said they view the effort as a form of potential political targeting that could draw legal challenges, including on free speech grounds, sources said."This disclosure rule goes directly to guilt by association," said Roger Colinvaux, a law professor at the Catholic University of America and former counsel to the nonpartisan Joint Committee on Taxation in Congress. "There's no federal law that says a nonprofit cannot have a convicted felon on their board. It could just create a stigma and chill association. This would reach deeply into American civil society."One of the sources with direct knowledge of the proposal, who spoke on the condition of anonymity because they were not authorized to talk publicly, suggested that such a move is not much different from material disclosures that publicly traded companies are required to make to help the investing public make informed decisions. The source also suggested that the proposal could help the IRS move faster to suspend or revoke the tax-exempt status of nonprofits if they fail to disclose convictions of any of their leaders. That's because the nonprofit officials who submit the Form 990 must attest to its accuracy under the penalty of perjury, and fact-checking whether board members have undisclosed criminal convictions would be a relatively simple task for the IRS to do, the source added.The disclosure efforts come amid a broader effort by the Trump administration to target left-leaning nonprofits. Mr. Trump signed a national security memorandum last year that directed the IRS to refer groups believed to be financing "domestic terrorism" to the Justice Department. In March, CBS News was first to report that the FBI and IRS Criminal Investigation teamed up to launch a "command post" tasked with investigating possible links between nonprofits and terrorism.That followed a directive from then-Attorney General Pam Bondi late last year for law enforcement agencies and federal prosecutors to probe the anti-fascist antifa movement and other "extremist groups." The memo asked law enforcement agents to consider investigating extremist groups for potential fraud and tax crimes. Antifa, a decentralized coalition of far-left activists, is not a formal organization and has no board members or officers.A number of federal criminal investigations and prosecutions targeting nonprofits are now underway. The highest-profile prosecution focuses on the Southern Poverty Law Center, which is accused of misleading donors and banks by funneling money to informants for white supremacist groups. The SPLC has pleaded not guilty.In another matter, Neville Roy Singham, the wealthy husband of the founder of the progressive nonprofit Code Pink and benefactor of far-left political causes, is under criminal investigation in Manhattan, CBS News previously reported. That investigation began by looking into possible violations of the Foreign Agents Registration Act and has since expanded into a criminal tax probe over whether money was unlawfully funneled through nonprofits he controls and whether he lied on tax forms for those nonprofits.Earlier this year, eight people affiliated with a North Texas antifa group were sent to prison for sentences ranging from 30 to 100 years, after they were convicted for providing material support to terrorists and other offenses, including the attempted murder of an Alvarado police officer at the Prairieland Detention Center.The proposal comes as the Trump administration has also focused its attention on fraud in recent months and spotlighted the pandemic-era Feeding Our Future scandal in Minnesota as an example of abuses in the nonprofit sector. So far, the estimated $250 million scheme has resulted in 68 convictions or guilty pleas. Some states already ask tax-exempt groups a version of the question the IRS is now weighing. California requires charities soliciting donations in the state to disclose whether their officers or directors have been convicted of certain offenses, as part of an effort to prevent charitable fraud. Under state law, a court can remove a director for fraud, dishonest acts or breach of duty in a case the attorney general can bring. But federal law has no equivalent remedy, said Ellen Aprill, a senior scholar in residence at UCLA Law School's center for philanthropy and nonprofits — meaning the IRS would be collecting information it has no stated authority to act on. "I think there is the potential for a fishing expedition," Aprill said.Alexander Reid, a partner at the law firm BakerHostetler who specializes in tax-exempt organizations, said the proposal about board members would collide with the Supreme Court's 2021 decision in the case Americans for Prosperity Foundation v. Bonta. The ruling struck down a California requirement that charities turn over lists of their major donors."The bulk collection and disclosure of sensitive information from tens of thousands of charities, much of which would never be relevant to tax administration or charitable-law enforcement, would fail exacting scrutiny by chilling freedom of association without furthering a narrowly defined governmental interest," Reid said.The IRS has come under the spotlight more recently over questions about political interference. Ken Kies, who was the top tax official at the Treasury Department, was ousted in July after warning that the White House was at risk of illegally involving itself in IRS audits, The Wall Street Journal reported.Steven Toscher, a tax attorney in California, said that from a good governance perspective, he does not see a problem with requiring nonprofits to disclose terrorism-related convictions of their board members. At the same time, he said, it's fair to raise questions about why the Trump administration wants this information, what it might use it for and how it defines terrorism."It's hard to view this in isolation of just good corporate nonprofit governance because of the executive who is proposing it," he said. "They have an agenda, so it's hard to filter this." Diane Yentel, president and CEO of the National Council of Nonprofits, which represents roughly 25,000 organizations, sees the administration's proposal for officers as part of a pattern of Republicans seeking to target groups in the sector that are not aligned with Mr. Trump."Nonprofits welcome reasonable regulation as a way to maintain public trust," said Yentel, but the proposal is "a step too far when viewed in the context of all of the administration's actions and rhetoric of the last 18 months, including equating some nonprofits to 'domestic terrorists' or 'enemies' of the American people."She said complying with the disclosure "would take precious time and resources away from nonprofits' core work of serving communities."
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