The Director of New America’s political reform program, Mark Schmitt, continues to ask for a fresh and realistic debate about campaign finance, and this is notable because his reform credentials cannot be questioned and because he states his case well and thoughtfully.  In an op-ed appearing today in The New York Times, he argues, correctly, that the reversal of Citizens United would not be as consequential as some assume. The questions about the role of money in politics would not be settled: in the cause of limiting the role of money and opening up the political process to the widest range of speech (and candidacies), the demise of CU would be a “minor step.”  He argues for the more central importance of other means of accomplishing core reform goals, such as public financing on the model of enactments in New York City and Seattle.

Schmitt does not discount effects, both direct and indirect, of CU, but he points out that it is just one of a long line of decisions limiting Congressional authority to regulate campaign finance, all the way back to Buckley.  In one way or another, the First Amendment unavoidably narrows the path reform can travel.

But this does not mean that that path is so narrow that it is for all practical purposes impassable. One of the lines of attack on CU is that it puts in doubt the constitutional support for any effective campaign finance regulation.  This critique holds that contributions limits—ordinary, regular contribution limits—may be next on the chopping block.  The McCutcheon case is then cited as evidence—at least as a signal—that the end may be near.

Of course, the more dramatic reading of CU, a turn away from Buckley, could turn out be to the case.  A Supreme Court willing to go as far as it did—and farther than it needed to –could well look for other opportunities to bring down the Buckley framework.

On this question, it has been useful to consider Judge Merrick Garland’s record on campaign finance.  He wrote for an en banc Court of Appeals in Wagner v, Federal Election Commission, 793 F.3d 1 (2015), upholding a complete ban on contributions to candidates by individual federal contractors. It is a thorough, scholarly piece of work, and the Court was united behind it.

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.

More Complaints about Super PACs

February 26, 2016
posted by Bob Bauer

David Frum’s thoughts about Super PACs are a useful reminder that not all the objections to these PACs are the same, not all fall within the usual range of complaints about bought-and-sold government or deepening political inequality.  Frum suggests that PACs may be victimizing donors and suffering abuse at the hands of their consultants, and that candidates, behind claims of independence, can and do disclaim all responsibility for these organizations’ behavior.  This is a set of concerns a few steps removed from the once dominant worry that these PACs would swing elections.

This perspective opens up a discussion of whether Super PACs can be brought within reasonable regulation, to deal with specific problems, without limiting the goal to the difficult and contested one of limiting independent spending.  The choice is between a hunt for anti-coordination strategies, which is essentially the hope to undo the Buckley guarantees for independent expenditures, and developing more conventional rules to account for the emergence of these PACs and the gaps in the regulatory system within which they are operating.

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.