Third Party Groups Under Fire for Big Spending in Midterm Elections

VIDEO: Jake Tapper looks at questions on the campaign trail in Colorado.
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In a nationwide argument over third party spending in the midterm election campaign, Colorado is ground zero.

Negative TV ads are almost inescapable in the Rocky Mountain state, where there's an open senate seat and a tight governor's race. Many of the ads are produced by third party groups that do not have to disclose their donors.

Watch "World News with Diane Sawyer" for more on this story tonight on ABC.

Since the beginning of September, independent groups reported spending some $9.4 million on Colorado campaigns with 80 percent of the funds going to help Republicans, according to Bloomberg News.

All that third party money has been met by heavy criticism from the left, including President Obama.

"They don't have the courage to stand up and disclose their identities. They could be insurance companies or Wall Street Banks or even foreign-owned corporations," Obama said today while campaigning for the Democratic senate candidate in Delaware.

Some Republicans also say anonymous third party spending does a disservice to voters.

"I think it is important that people know who is paying for the ads and what their relationship is with different issues," Republican senate candidate Ken Buck said in a debate in Denver, Colo. today, hosted by ABC News.

But not every Republican is consistent about the principle of transparency.

As Comedy Central's Jon Stewart pointed out on his program, Republican strategist Karl Rove defends the rights of anonymous donors to his third-party political group, even after harshly criticizing anonymous funding back in August for the controversial Islamic prayer and community center in Manhattan.

"I do think there is questions about who is behind all of this," Rove said, referring to the plans and funding for the Islamic center. "They need to tell us who is behind it. Where is the money coming from?"

"Americans for Prosperity" Defends Actions

President Obama often mentions one third-party group by name -- "Americans for Prosperity."

Today, the head of that organization defended his donors' anonymity.

"Too often, we see politicians and other partisans who would demonize individual Americans for just being involved in the public policy process, and that'll be wrong," said Tim Phillips, president of "Americans for Prosperity."

On the campaign trail, the president, Vice President Biden, and other top Democrats have also targeted the U.S. Chamber of Commerce for its massive ad spending, which is second only to the National Republican Congressional Committee, according to the Center for Responsive Politics.

Without providing any evidence, Obama has suggested that since the Chamber of Commerce has foreign members, perhaps some foreign money is funding pro-Republican attack ads. The Chamber denies the charge.

"We're not going to subject our contributors to harassment, to intimidation, and to threats and invasions of privacy at their houses and places of business, which is what has happened every time there's been disclosure here," said Josten.

In fact, the Chamber said all the criticism has been a windfall for donations, with one prominent donor happy to disclose his identity. Glenn Beck just announced his plan to donate $10,000 to the Chamber of Commerce because of the controversy.

"I put my money where my mouth is," Beck said today on his radio program. "I made a donation today myself. I urge you to do the same."

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