Archive for the 'Super PACs' Category

Citizens United and the “Impossible Dream”

July 13, 2016
posted by Bob Bauer

Justice Ginsburg’s recent press comments have been noted mostly for her openly expressed disdain for the Trump candidacy. Less surprising in the remarks was the Justice’s “impossible dream” that Citizens United be overturned. She has said this before, and since she dissented in that case, there is not much news here, unless anyone still had doubts that for this Justice, the killing off of that decision is a priority.

The comment was reported at the same time as the Complaint filed with the Federal Election Commission by Representative Ted Lieu and others who intend to set into motion the reconsideration the Justice is hoping for. And so it invites an appraisal of its prospects for accomplishing the Justice Ginsburg’s “impossible dream.”

As my colleague Marc Elias has pointed out, the FEC cannot succeed; this is a lost cause. When the Complaint fails, it may do little more than unnecessarily promote the belief that CU is here to stay. It is not clear why this is the best legal maneuver, or the most effective exercise in public communications, in the attack on Speechnow and Citizens United.

Aside from the question of strategy, the Complaint itself  is a surprisingly subdued performance. It has a bit the feel of going-through-the-motions: doing the least possible to set up the agency dismissal and the move to the courts. True, the Complainants knew that the outcome at the agency was inevitable and there is time later to build their argument. But the case they preview in the Complaint seems flat and this certainly can’t help the Complainants in their subsequent appeal.

One FEC Commissioner’s Answer to Citizens United

April 7, 2016
posted by Bob Bauer

FEC Commissioner Weintraub believes that she has hit upon a regulatory maneuver to stop publicly traded corporations from making independent expenditures, or unlimited contributions to independent expenditure committees.  At a time when newspaper editorialists carry on with attacks on the Commission as “worse than useless,” the Commissioner seems determined to prod the FEC to face the major “money in politics” issues of the day.

This is her theory: foreign nationals cannot make contributions or independent expenditures, which means that the FEC could establish that no corporation with foreign nationals as shareholders could engage in this political spending.  The rule would not bring about this result outright: it would require a corporation to "certify" that it was not making contributions or independent expenditures with these funds.  As a practical matter, corporations with foreign national shareholders could not risk making the certification and would forgo this political spending.  The Commissioner plans to direct lawyers to produce proposals that she and her colleagues can consider in a future rulemaking.

This is an interesting proposal, but it is generally appreciated that a Commission unable to agree on matters of lesser moment will not find a majority in favor of this one.  But even beyond that, the proposal is vulnerable to questions about its viability as a regulatory measure.

Louisiana is arguing with the help of the indefatigable Jim Bopp that McCain-Feingold cannot limit “federal election activities”, such as GOTV and voter registration, that state and local parties conduct independently, without coordinating with their candidates. Democracy 21, the Campaign Legal Center and Public Citizen reply in a brief filed as amici that this claim is clearly foreclosed by existing precedent: the soft money limits on state parties under McCain-Feingold are contribution limits, not spending limits, and there is no protection gained from claiming to conduct independently the activities paid with these contributions.

The litigating team representing these leading reform organizations is top-notch, and so it is not a surprise in reading their brief that they do a fine job with the materials at hand. But one also sees that there is a problem—not with the advocacy, but with the state of the law.

The Brookings Report on the State Parties

March 14, 2016
posted by Bob Bauer

A Brookings Institution study of state parties, authored by Ray La Raja and Jonathan Rauch, is the latest of the sober commentaries on contemporary campaign finance.  La Raja and Rauch conclude that state parties have lost significant ground to outside groups and are impeded in large part by federal regulation, mostly by McCain-Feingold, in performing critical functions. They would like to see for these state parties increased or eliminated contribution limits, deregulation to enhance their ability to coordinate with candidates and to conduct ticket-wide activities, and perhaps even public financing measures in the form of tax deductible contributions.  The strengthening of state parties, they are convinced, can promote more moderate politics; it can offset to some extent the polarizing forces unleashed by “outside groups.”

It is a thoughtful report and a contribution to the growing consensus that campaign finance laws today are unworkable and in desperate need of reform.  The question is: are state parties, for the reasons given, an appropriately special focus of reform.

As the authors note, there are other reasons for the struggles of state parties and the rise of the outside groups.  Laws and rules may add to the problem but are not its exclusive cause. Much of what La Raja and Rauch say about state parties would apply to the parties as a whole, at the national as well as the state and local level, and there are other actors within the regulated system also clamoring with justification for relief from outdated, burdensome, and pointless regulatory limits.

The case for singling out the state parties rests on La Raja and Rauch’s belief that these organizations are “important nodes of the political equivalent of civil society,” capable of creating “social capital by building connections, trust, and cooperation across diverse individuals and groups.”

This is a strong claim.

The FEC and the Case of the LLC

March 10, 2016
posted by Bob Bauer

The Federal Election Commission’s job is hard, harder than many will admit, but the agency somehow manages to make it even harder. So now, five years after the fact, the FEC has decided not to investigate a donor's alleged use of an LLC to mask a $1 million contribution to a Super PAC.  The word of the non-decision got out before any member of the FEC could explain it or any of the case materials were released.

So naturally the agency looks somewhat silly.  Some might and do ask: how could it be that the alleged establishment of an LLC to mask the true source of a large contribution isn't even subject to an investigation?  And why would it take almost five years for that inconclusive result to be reached?  Maybe the case files once released, along with the explanations of the different Commissioners, will provide some answer to those questions.

The case did take an unusual turn in 2011 when the individual donor came forward, claimed that a lawyer had advised him that he could do this, and asked that the Super PAC amend its reports to disclose him as the true donor.  In other words: on the date that the complaint was filed and before the FEC began its review, the harm of the particular case was being redressed.  And presumably complicating matters was the donor’s contention that he acted on legal advice.