There is now bipartisan interest in a change in the lobbying rules to reach the “back room” or “shadow” lobbyist. Most immediately, the proposal has been to have the new Administration expand the ban by Executive Order on federal government employment of lobbyists to include these individuals believed to be lobbyists in all but the name. This would close a much-derided “loophole,” one that has been especially infuriating to those who do register under the lobbying disclosure law while watching others, who seem to do pretty much what they do, escape on an apparent technicality. An amendment to the Executive Order to capture “shadow lobbying” could be followed by a corresponding change in the lobbying laws to greatly enlarge the numbers subject to mandatory disclosure requirements.
The appeal to close a loophole packs its usual punch. It answers the frustration over apparent inconsistency (the demand that those doing similar things be treated alike), and the extension of reporting requirements to “shadow lobbying” would help create a more complete picture of the total dollars spent on influencing public policy. But, as always, there are complications and competing considerations that should affect how a reform like this is designed--with what limiting principles--and how it is administered.
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.
This is one view of the effects of modern political reform, and here is another, and their conclusions are, in a sense, similar: reforms have not worked as intended. But they don’t have in mind the same failures.
Robert Samuelson thinks the reforms have weakened the political system, undermining political parties and blocking other channels for constructive compromise and effective governance. Isaac Arnsdorf argues that, in the case of lobbying reform, the laws have worsened corrupt practice, not curbed it, and he is most exercised by legislators' ability to wield influence for private profit after leaving office.
The one commentator thinks we have government enfeebled by the unforeseen effects of reform; and the other sees reform to have left government more corrupt. Both analyses travel the familiar route of making a point that it invites the reader to take too far.
The 10th Circuit decided another disclosure case, Coalition for Secular Government v. Williams, on the mandatory reporting of “issue speech”. It held that an individual collecting small sums to wage a campaign on ballot questions did not have to comply with registration and disclosure requirements applicable under state law to “issue committees.” The "committee" that was really just a one-person enterprise was too "small scale,” the government's interests too limited: the cost in the particular case exceeded the benefits.
Did this result turn in any way on the nature of the advocacy – – that it was on issues, not for or against candidates? The courts have long distinguished electoral from issue speech in determining the scope of constitutional protections. Buckley v. Valeo, 424 U.S. 1(1976); Citizens against Rent Control v. Berkeley, 454 U.S. 290 (1981); First National Bank of Boston v. Bellotti, 435 U.S. 765 (1978). The government's interests in the case of campaign speech are more varied and include both the prevention of corruption and its appearance, and the assistance that disclosure provides to enforcement of contribution and other regulatory limits. The 10th Circuit found those rationales “irrelevant or inapplicable to issue committees,” and while it has upheld Colorado's issue committee disclosure in principle on the strength of another interest, the voters’ informational interest, it concluded that this interest was insufficient to sustain the law as applied to the Coalition for Secular Government.
In campaign finance law, this distinction between issues and campaign speech has led reform advocates and their allies in legislatures to insist that while the difference may matter to constitutional analysis some of the time, this cannot be not the case all of the time. They maintain that some issue speech is often campaign speech in disguise, and the Supreme Court in McConnell upheld "electioneering communication" disclosure on the basis of its finding that some issue speech was a “sham.” Now the courts must entertain claims in as applied to cases that the plaintiffs’ issue speech is not a sham, that it is the real thing, and that it cannot be regulated as campaign finance spending.
A strength of any reform discussion is careful attention to the role of campaign finance in lobbying activity. Critics of standard reform proposals complain that “insiders” are attempting to regulate the political activity of “outsiders”, but this objection has less force when campaign finance restrictions fall more heavily on the insiders – – on legislators and the lobbyists who may build relationships with them by raising and giving campaign money.
So Senator Michael Bennet, supported by the reform community, has developed a bill entitled the Lobbying and Campaign Finance Reform Act of 2015, which pursues reform objectives from the "inside." It would expand the number of those who are required to register as lobbyists, and it would limit the influence they amass through the fundraising known as bundling. And the Members of Congress that they lobby could not solicit them for contributions when Congress is in legislative session. The focus here is on campaign finance as a lubricant of successful lobbying, and on any temptation in official circles to link the performance of the public’s business to campaign support.
The next question is-- how would this reform, if enacted, work, and how effective would it be in meeting the goals set for it?