The Federal Election Commission has not solved the “Super PAC problem,” but then again the Commissioners cannot agree on what the problem is. Others outside the agency are divided in this same way. A number of questions in contemporary campaign finance are like that. Because positions are passionately held, each side is convinced that the other is not merely mistaken but dead wrong, maybe also ill-motivated. Given the chance, proponents and opponents of new rules would like to win however they can.

So there is the hope that the Supreme Court can be shifted by a vote toward a more favorable judgment on congressional power to control campaign finance. And proposals are made to strengthen the FEC for a more decisive role. The Brennan Center suggests that the FEC could make strides in the direction if it could be restructured to a) bring an element of nonpartisanship into the choice of Commissioners, by assuring that at least one is unaffiliated with a party and b) add an additional Commissioner to the total to get to an odd number and avoid deadlocks. The changes would supposedly work together to make good decisions: the odd number of Commissions guarantees decision, and the provision for nonpartisanship improves the chance that the decision will be a good one. To secure this ingredient of nonpartisanship, the Brennan Center suggests a “blue ribbon advisory panel” to recommend nominees for consideration by the President.

The goal of a decision is different from the goal of a good decision and so, in this respect, an odd number of Commissioners only gets us so far. And no one has yet defined how “blue ribbon” recommendations of Commissioners, or the requirement that one or more of them be unaffiliated with any political party, will achieve a particular reform objective.  “Nonpartisan” Commissioners will not be without opinions; they will hold views that inform their regulatory positions, just as there are independents who reliably identify with one party or the other.

The Van Hollen decision handed down yesterday, on a disclosure issue, is remarkable on a number of levels, none of which involve the precise issue before the court.  The United States Court Appeals for the District of Columia did narrow the disclosure required in connection with so-called “electioneering communications,” but as a practical matter, the damage done to transparency is probably of middling consequence.  As matters now stand, anyone wanting to spend substantial money to influence elections and keep much of it from detailed public view has a number of options.  The option that the appeals court ratified yesterday is just one, and probably not all that high on the list.

More important is the way the panel moved, to a new plane, the political case that critics of campaign finance reform have been building against disclosure.  The panel gave the Supreme Court a failing grade on its disclosure jurisprudence. It faulted the Justice for failing to weigh seriously the trade-offs between speech and disclosure, and it believes that it has launched them on an “ineluctable collision course.”  It also thinks the Court has compared constitutional apples and oranges. Speech is a right, and transparency is an “extra-constitutional value”: the appeals court panel evidently believes that, in locating the right constitutional balance, the Supreme has overvalued the extra-constitutional value.

The panel also strikes hard at the notion favoring regulation broad enough to block obvious cases of “circumvention”—cheating. On the issue before the Court, the FEC had concluded that a donation to an organization funding “electioneering ads” was reportable only if made for the precise purpose of paying for these communications. The plaintiff Van Hollen objected to the ease with which this rule can be evaded.  A donation can be made with no specific statement about its use; or maybe the trick is done with a “wink and a nod.”  Unless the regulators can implement a more sweeping requirement without attention to stated, demonstrated purpose, the statutes’ purpose can be “frustrated.”  The court is unimpressed: maybe so, it replies, but the likelihood that a rule will be ineffective is not enough to weaken the force of the constitutional concerns provoked by more muscular alternatives.

Disclosure and a Few Hundred Dollars of Spin

January 15, 2016
posted by Bob Bauer

Beware the opinion on a disclosure issue that begins with the fabled Brandeis observation that “sunlight is said to be the best disinfectant.”  It is meant to make all that follows relatively simple. Brandeis is powerful authority, and he was not just claiming the insight for his own, but instead assigned it universal standing: disclosure “is said” to have this cleansing effect, and it is the “best” of effects.

The Fifth Circuit propelled itself down this path in a case, Justice v. Hosemann, that the Supreme Court is being asked to take up. 771 F.3d 285 (2014).  The question is whether individuals coming together to influence a ballot initiative, but spending little more than $200, can be compelled to register and report as a political committee.  Mississippi law includes this requirement and, finding that the plaintiffs had standing to bring a facial challenge, the Fifth Circuit reversed the lower court and upheld the law as a constitutional measure to serve the voters’ “informational interest.”

The Court began with Brandeis and then moved quickly to suggest that others states have imposed even more onerous registration requirements for issues speech, set at still lower spending levels.  This seems to be a monumental non sequitur.  That a number of states have adopted constitutionally questionable laws does not settle, in their favor, the question of constitutionality, or logically make the case for Mississippi’s slightly more liberalized version.

But there is also the suggestion that in the Internet Age, the voters’ informational interest requires disclosure deep down, to the most modest spending of a few hundred dollars.  The Fifth Circuit cited in full this passage from National Organization for Women v. McKee:

In an age characterized by the rapid multiplication of media outlets and the rise of internet reporting, the “marketplace of ideas” has become flooded with a profusion of information and political messages. Citizens rely ever more on a message's source as a proxy for reliability and a barometer of political spin.
649 F.3d 34, 57 (1st Cir.2011).

“Not Authorized”

November 29, 2015
posted by Bob Bauer

Right now the basic complaint about Super PACs is that they can enlist the and endorsement support of their favored candidates, as in fundraising, and still claim they are “independent” and spend without limit.  But the Supreme Court—not the FEC, not wily campaign finance lawyers—is the reason why this is possible.  In Buckley, the Court tied “independence” to the coordination of specific expenditures with candidates. Without this coordination, the Buckley Court determined, the candidate runs the risk that the expenditure could be unhelpful or counterproductive and is not fairly charged with a “contribution” subject to limits.

No candidate request, control or involvement means, therefore, no spending limits.  The independent committee's public advertising then must contain a specific statement that the candidate did not "authorize" the communication. 11 C.F.R. §110.11(b)(3). This may be true, but the voter checking the committee’s formal registration with the FEC will find that the committee declares itself, and not just a specific expenditure, to be unauthorized.

In a technical sense, this is true: the committee is “unauthorized” because it is an independent committee whose expenditures are made without the candidate’s direction or involvement.  But the absence of control over or involvement in particular independent committee expenditures does not mean the absence of any contact with the committee.  The candidates can applaud an independent committee’s formation and operation for their benefit, and they may appear at the committee's events as guests or featured speakers and assist with its fundraising.

Voters may well be perplexed.

Disclosure Wars

November 16, 2015
posted by Bob Bauer

Sometimes those who disagree about campaign finance are almost deliberately talking past each other, dreading any concessions because, they think, to give an inch is to surrender a mile.  This seems increasingly the case in arguments about disclosure and a good example are the opposing reactions to the Supreme Court's recent decision to decline review of California's 501(c)(3) disclosure requirements upheld by the Ninth Circuit in Center for Competitive Politics v. Harris, 784 F.3d 1307 (9th Cir. 2015).

Here is one fundamental difference: the belief on the part of decision proponents that it was a victory for campaign finance disclosure, and reply by critics that it had nothing to do with campaign finance at all.  And indeed, in technical terms, the case is not a campaign finance case – – it does not involve electoral activities, which 501(c)(3)'s may not conduct, and the information that the government is asking for is not in theory to be made available to the general public but only for the use of authorities for law enforcement.

To those who favor the State of California’s position, however, its significance goes well beyond its holding viewed in the most narrow terms.  If the case did not concern campaign finance, they seem to be saying, it was close enough: it involved a privately funded nonprofit advocacy organization, and a court willing to invalidate those disclosure rules might be tempted to export this critical attitude to the sphere of campaign finance.  There is a fear at work here that if a crack opens in disclosure requirements anywhere, they could expand to swallow up the campaign finance rules. On this theory, the court should be favorable to disclosure of political activity all kinds, to avoid damage down the line to rules of one particular kind.

The discussion of the parameters of compelled disclosure has become, in this sense, politicized.  Anxieties about the collapse of the campaign finance laws are gathering around all roughly similar disclosure requirements as a sort of last stand.  Rick Hasen has written that "campaign finance disclosure laws are under attack" and that much of the criticism has been "offered disingenuously with the intention to create a fully deregulated campaign finance system." Richard L. Hasen, Chill Out: A Qualified Defense of Campaign Finance Disclosure Laws in the Internet Age, 27 J.L.& Pol. 557, 559 (2012).  In his view, because the questioning of disclosure requirements is in many cases "pretextual”, id. at 559, this Court must be closely watched, because if it appears to move away from transparency in any case involving public advocacy, the end could be near. The Court could be poised to water down the disclosure commitment expressed in Citizens United.

Meanwhile, the important doctrinal question of how to measure the costs as well as the benefits of compelled disclosure is passing out of focus.  There is general acceptance that harassment is a cognizable injury threatened by disclosure of a nonprofit association's members and donors, and that in Buckley v. Valeo, 424 U.S, 1 (1976) and Brown v. Socialist Workers ’74 Campaign Committee, 459 U.S. 87 (1982), the Supreme Court provided a remedy through exemptions that can be granted in particular cases to endangered speakers.  But on the question of how this exemption should be structured or operate, the differences are wide.