To defend the post-McCain-Feingold version of campaign finance reform, proponents have taken special pains to say that it did not really hurt the political parties. They bounced back, engineered new ways to raise money, became perhaps even stronger. The soft-money the 2002 law took away from them has been replaced by other sources of funding. Online contributions have helped, and so has special new party fundraising authority enacted by Congress in the “Cromnibus.”
But even more important, according to this line of argument, is understanding what a political party is. It is not correct, on this view, to point to the formal institutional party organizations, but parties should be viewed instead as “networks” of allied entities. That would include, for example, interest groups sympathetic to Democrats or Republicans, Super PACs aligned with either major party (sometimes referred to as “shadow parties”), and even Fox or MSNBC.
Now the Campaign Finance Institute has put out new research and commentary in support of this picture of the parties. Having assembled data to show that Super PACs aligned with party interests spent large sums of money in 2016, the CFI declares that there is no cause to “bemoan” the weakness of parties. Parties have “rebounded”: they “have found a way to fight back” after the reforms and Citizens United.
And how did this happen? On this point, CFI words its position delicately. The parties’ recovery can be attributed in part to the “law’s permeability.” The unrestricted funding and spending of Super PACs "looks much like the soft-money the formal parties accepted before the Bipartisan Campaign Reform Act of 2002 (BCRA).” There are advantages and disadvantages to this development. On the plus side, the "shadow party" PACs don’t have to pretend to be “issue advertising” and can spend on direct advocacy of their candidates. But, more negatively, they have to set up as “independent” of candidates or the institutional parties and cannot coordinate their spending with them.
In a first step out on political reform (setting aside his executive order on lobbying), Donald Trump promised churches he would relieve them of the restrictions of the Johnson amendment on campaign activity. He didn't go into any detail.
But over time there have been different proposals for protecting religious institutions’ political speech. One of them is arguably sensible, while another, more aggressive reform of this nature is best avoided.
Attention began to turn more widely to this topic when in the Bush 43 years there was a suggestion that IRS was monitoring sermons and prepared to act against churches where it found campaign content in speech from the pulpit. A notorious case involved a sermon that was critical of the war in Iraq and included favorable comments about Democratic presidential nominee John Kerry and critical ones of his opponent George W. Bush. Nothing happened; the IRS backed off. But it remains the case that while the Service seems to have no particular appetite for regulatory action based on this kind of speech, it could, if it wished. And as the Bush/Kerry episode revealed, the issue can cut in either partisan or ideological direction.
That is one issue, and a reform has been advanced to address it. Its sole point would be to allow for speech in the ordinary course of communications by a religious institution. In 2013, an organization called the Commission on Accountability and Policy for Religious Organizations recommended that religious institutions be free to make communications "related to one or more political candidates or campaigns... made in the ordinary course of… regular and customary… exempt purposes," provided that the expenses incurred are de minimis. The exemption would apply specifically to sermons delivered "as part of a religious organization's regular and customary worship services."
In 1968, the Nixon presidential campaign successfully persuaded the South Vietnamese government to scuttle peace talks with the North. The goal was to end any possibility of an election-eve accord that would boost the prospects of the Democratic presidential nominee, Hubert Humphrey. Candidate Nixon and his agents assured the South Vietnamese, who took the deal, that a Nixon presidency would better protect their interests. This was a glaring case of foreign interference with elections. The election turned out to be close and the intervention was very plausibly a factor in the outcome. See, e.g., Tim Weiner, One Man Against the World: The Tragedy of Richard Nixon 19-26 (2015).
This is the kind of “interference” in an election that Congress is preparing to investigate. It remains to be seen whether the inquiry will eventually become more far-ranging-- whether it will also examine other forms of foreign influence over the electoral and policy processes that are less brazen but still consequential.
For example, the Federal Election Commission recently could not agree on strengthened restrictions on campaign spending that serves foreign interests. Foreign nationals are prohibited generally from making contributions or expenditures in federal elections, but the rules are porous. Companies controlled by foreign nationals, including those directly or indirectly controlled by foreign governments, may establish PACs and fund campaigns with money contributed by their American executives. The law prohibits foreign nationals associated with the ownership or management of the company from directing or indirectly participating in these funding decisions. The enforcement challenge is obvious: how to capture this “participation,” which may include oral directives or suggestions that are not easily discovered. Beyond this, Americans in the employ of the wholly controlled USA subsidiary might guide their funding decisions by close reference to what they believe or know to be their foreign owners’ interests and preferences.
Progressives thinking about the experience with reform have to grapple with its implications for mobilization, for effective political speech and action. As previously noted here, one traditional reform objective – – regulating issue advertising – – bears reconsideration For years, a priority has been to expand the rules to cover certain issue advertising within election seasons. The authors of McCain Feingold settled on what they took to be an objective test--define the election season as a month to two months before an election, and then capture within reporting requirements ads that simply” refer” to a candidate and are directed to his or her electorate. The ads affected would surely be “sham” ads, intended to influence the election, and disclosure of the financing of these “electioneering communications” would be appropriate, as it is in the case of clear-cut campaign advertising.
But is there such a thing as a genuine issue ad--one that is designed to discuss candidates in relation to issues but without, within the four corners of the ad, expressly calling for the candidate’s election or defeat? Or to put it in doctrinal terms, may the government reporting rules reach ads that do not involve either express electoral advocacy or its “functional equivalent”? The Court in McConnell v. Federal Election Commission took it more or less for granted that genuine issue ads would not be subject to mandatory disclosure. 540 U.S. 93, 206 n.88 (2003) (“ [W]e assume that the interests that justify the regulation of campaign speech might not apply to the regulation of genuine issue ads").
In Citizens United, the Supreme Court devoted a line to the seemingly contrary conclusion, suggesting in the most general terms that "the public has an interest in knowing who was speaking about a candidate shortly before an election." Citizens United v. Federal Election Commission, 558 U.S. 310, 369 (2010). But its discussion on this point was short, and it also appeared in a case that involved a communication--a movie--that was plainly intended to influence voter choice. It was decidedly not a case about “genuine” issues speech.
The Independence Institute, a 501(c)(3) organization, has pressed on this issue with a challenge to the application of the reporting rules to an ad lacking either express advocacy or its functional equivalent--i.e. a "genuine issue ad.” The ad named two Senators, one running for election, in appealing for support of pending legislation on criminal justice reform. A three-judge district court last month rejected the claim that the ad was constitutionally protected. The Court relied on the language of Citizens United. It appeared satisfied that even in the case of a genuine issue ad, a reference to a candidate was sufficient to trigger the electioneering communication disclosure requirements. Independence Institute v. Federal Election Commission, No. 14-cv-1500, 2016 WL656396 (D.D.C. November 3, 2016).
A partial picture of campaign finance in 2016, with much still to learn, suggests that the fully rounded-out version may feature surprises and interesting twists. It will certainly influence, perhaps even redirect, the debate over reform.
The aggressively "outsider" Republican nominee is relying on the party apparatus to fund the basics of his campaign. Trump is succeeding with on-line fundraising, as one might expect from outsiders, but it is not enough without the party doing, or attempting to do, what is needed. How well will the party do? Meanwhile, the Super PACs have been slow to extend their support to this candidate of self-declared if disputed wealth: while this may change in the weeks ahead, the wealthy have so far declined to shower their funds on this candidacy, instead putting much of their resources into congressional races.
On the Democratic side, the Super PACs are active: the Washington Post’s Matea Gold and Anu Narayanswamy find that “once-reluctant Democrats have fully embraced” these entities as key requirements for being competitive. In the primaries, however, these PACs were a point of controversy and small donors financed an insurgent, outsider candidacy that was fully competitive with what the front-running candidate from within the party could muster. Meanwhile, while the rallying cry for reform remains Citizens United, the most prominent money behind the Super PACs money is individual and not corporate.
Any year can present in unusual fashion and it is hazardous to put too much weight on the experience with presidential elections or to overgeneralize from it. But in the months ahead, it is an experience that will be cited and argued over, and it will have its effect. One conclusion drawn may well be that we still don't know how the crazy-quilt campaign finance system influences the politics of the campaigns—favoring or disfavoring parties, opening (through the Internet) or narrowing (through the Super PACs) participation, exacerbating or balanced out incumbent advantage.
Beyond these considerations are the venerable reform objectives of controlling corruption and promoting equality. Jeffrey Toobin in The New Yorker speculates about the implications of a Clinton victory for the confirmation of a new Justice and a new Supreme Court majority willing to revisit Citizens United. He asked Pam Karlan and Heather Gerken for their views and each splashes cold water on any excessive optimism that the court, even if it changed course, would make much of a difference to the accomplishment of traditional reform objectives.
Professor Karlan suggests that while Citizens United is a “shorthand” for the role of money in politics, that decision has little to do with the problem seen in campaign finance and its demise will not solve it. Professor Gerken does not go that far, but she does not see the Court as the prime mover in reform. Congress would have to act first, regulating Super PACs and other “shadow” groups, and she doubts that it will.