Archive for the ‘Super PAC’ Category

Campaign Finance Regulation Needs a Home

Posted on:

securities-and-exchange-commission-photo-thanks-to-flickr-user

The Federal Election Commission can no longer be considered the sole federal agency tasked with regulating federal campaign activity.  As a recent New York Times article suggests, the Securities and Exchange Commission may soon require publicly traded corporations to disclose the names of individuals who contribute to various so-called Super PACs.  Not surprisingly, the measure is strongly opposed by business organizations such as the Chamber of Commerce, which argue that such measures would infringe on the group’s right to free speech. The Internal Revenue Service has also been highlighted recently for its alleged overreach in targeting tax-exempt 501(c)(4) organizations associated with the conservative Tea Party.

These latest events highlight just how thorny of an issue campaign finance regulation has become.  Agencies that are not normally tasked with any kind of campaign regulation have found themselves forced to overcompensate for a seemingly ineffectual FEC.

In international relations, the term “proxy war” is used to describe a situation in which two opposing parties utilize a substitute, or a third party, as an alternative to fighting each other directly.  What Citizens United seems to have engendered, is a proxy war between liberals and conservatives in which government agencies are being used as reluctant battlegrounds.   As we have witnessed this past week, the results are at best messy, and at worst, damaging to the overall legitimacy of the federal government.

The longer both sides continue to battle one another over procedural matters in multiple agency arenas, the more distant they become from their purported fundamental purpose for being, which is to engage in political advocacy.  Not to mention, of course, the more contributor money they waste in the process. But is there any alternative?

These organizations might benefit from looking back to 2004 and the similar issues brought forth by so-called “527” organizations and their apparent exemption from the recently passed Bipartisan Campaign Reform Act of 2002 (also known as McCain-Feingold).  The crucial similarity between the battles being waged today, and those of the past, boil down to one thing: the definition of a “political committee” as defined in the FEC Act.

The difference between the strategies implemented today versus 2004, is that in the latter, watchdog groups and political parties funneled all their complaints and fought all their battles in one arena – the FEC.  Both sides filed complaints and the FEC came down hard on 527’s, primarily for failing to register as political committees.  As a result, America Coming Together was fined $775,000, the Media Fund was fined $580,000 and the Swift Boat Vets and POWs for Truth were fined $299,500.

A strategy that devotes resources to one specific arena (namely, the FEC) could be particularly beneficial for liberals and other proponents of increased disclosure.  The Supreme Court unambiguously upheld disclosure laws as constitutional.  If disclosure is the bottom line, then liberals and supporters need to bring the fight back to the FEC where they maintain a home turf advantage. Otherwise, they risk undermining their cause by fighting procedural battles in agencies that have little interest in regulating campaign activity and little incentive to become enmeshed in a political battle as contentious as campaign finance.

 By Erinn Larkin, Compliance Director, PACs and Parties

 

Why is the Senate Electronic Filing Bill Deemed Unlikely to be Enacted Despite Near Consensus?

Posted on:

Few issues or policy realms have the power to bring together alliances like those witnessed in the now infamous Citizens United case, which pinned the ACLU, NRA, AFL-CIO, and Chamber of Commerce against an alliance that included the American Independent Business Alliance, the DNC, and Senator John McCain (among others).  Even fewer have the ability to kindle bipartisanship and consensus in a political landscape characterized by polarization and gridlock. Yet the Senate Campaign Disclosure Parity Act introduced by Senator Jon Tester earlier this year has indeed managed to receive bipartisan support.   The bill would compel Senate candidates to electronically file campaign finance reports along with the other federally registered committees that have been doing so since 2001 (PACs, Parties, and House Members). The bill would save time, tax dollars, and improve disclosure and transparency.

So why do organizations like GovTrack.us, which track the statistical probability of legislation being enacted, give the bill a 10% chance of success?

In 1971 when the FEC Act was originally enacted, the law dictated that Senate candidates file their reports with the Secretary of the Senate who would then forward them to the FEC. All other committees were to report directly to the FEC. In 2001 when the FEC required that almost all committees file their reports electronically, the Senate was exempted from the law and has continued to file on paper ever since.

Why shouldn’t the Senate be allowed to continue filing on paper?  There are several reasons why compelling the Senate to file electronically is a common sense law. First, the current procedure is inefficient. The candidate sends their report to the Secretary of the Senate, who then forwards the report to the FEC. The FEC then sends it to a third party firm that re-types the reports, enters them into a database, and sends the information back the FEC. Only then is the information available to the public.  By contrast, reports thatare uploaded electronically are instantly available to the public.

Second, the current procedure is costly.  The FEC estimates that having the Senate file electronically would save tax-payers just under $500,000 per year. It would undoubtedly save candidates the expense of printing and sending hundreds of pages worth of reports at-least four times a year.  It also unnecessarily wastes the time of government employees.  Because the Senate reports need to be re-typed, every time a campaign finance analyst finds a potential violation, they must then locate the paper image to ensure it corroborates with the re-typed data.  Such a time-consuming, redundant process is obviated by electronically filed reports.

Lastly, it would provide greater transparency.  While the FEC pays for the service of re-typing the data, it is entirely for their own review purposes. The formatted data is never made available to the public. Therefore, individuals interested in reviewing Senate reports must scroll through hundreds of pages of text-unsearchable PDF images.  For all these reasons, the measure to compel the Senate to file electronically has received widespread support and near consensus among all parties involved.

Why might the bill fail regardless of such widespread support? Those interested in the passage of the Senate Campaign Disclosure Parity Act of 2013 should pay attention to the behavior of Senator Mitch McConnell and his role in the failed Senate Campaign Disclosure Parity Act of 2007.  Senator McConnell first placed an anonymous hold on the bill (when pushed, he later revealed his identity).  He then attempted to attach an amendment that would loosen coordinated expenditure laws between parties and candidates.  In short, he sought to negotiate for policy reform when the matter at hand concerned procedural reform, which to many, was simply too unreasonable and unequal of an exchange.  Observing McConnell’s disposition toward the current bill may provide insight into its chances of ever getting past committee and on to the floor for a vote.

 By Erinn Larkin, Compliance Director, PACs and Parties

The latest challenge to McCain-Feingold: McCutcheon v. FEC

Posted on:

A recent article by in the Huffington Post by Jay Pinho alludes to the thorny spot that progressives have found themselves in vis-a-vis campaign finance rules, ever since the Supreme Court decided the Citizens United case in 2010.  He discusses the recent victory of Robin Kelly the IL-2 special primary election, and the instrumental role that Michael Bloomberg played in Kelly’s electoral success.  Bloomberg flooded the race with money in order to make good on his promise to support gun control advocates.  The point he makes is this: how do Democrats celebrate these progressive victories, while at the same time, work to reverse the rules the allowed them the power to get their message out in the first place?

Pinho also mentions the frustration felt among progressives in knowing that the Supreme Court has the potential to further roll back campaign spending rules when it hears the McCutcheon vs. FEC case in October.  He states, “in conjunction with the Court’s notorious Citizens United v. Federal Election Commission decision from 2010, which lifted the ban on corporate expenditures and led to an explosion of outside spending during last year’s election campaigns, such a ruling in McCutcheon would augur a decisive transformation of American electoral norms — from “one person, one vote” to something approaching ‘one dollar, one vote’.”

The McCutcheon case challenges the constitutionality of individual aggregation limits, which refer to the maximum amount that one individual can contribute to parties, PACs, and candidates during any two year election cycle.  For the 2013-2014 election cycle, this amount is $123,200.  Of this amount, no more than $48,600 can go to candidates; the remainder must go to either PACs or party committees.  This limit should not be confused with the maximum amount that candidates are allowed to receive for their campaigns, which remains unchallenged, and at $2600 per election.  If the Supreme Court sides with McCutcheon, then this limit will be abolished, and individuals will be free to contribute the maximum allowable amount to as many candidates as they choose.   Thus, the case can perhaps be better  understood as an attempt to abolish the limit on the number of candidates individuals can support, rather than the amount of money they can spend per se.

There are several reasons that progressives should take pause before automatically lambasting all individuals, organizations, or proposals to alter extant campaign finance regulation.  First, the practical effects of eliminating individual aggregation amounts is likely to be minimal.  At the current limit, individuals can “max-out,” in other words, contribute the maximum amount of $2600 to both the primary and general elections of a particular candidate, to no more than nine congressional contenders during a two year period.   Of the very small percentage of Americans that contribute to congressional elections at all, an even smaller amount max-out to any one candidate.  The number of individuals who max-out to nine candidates, and exhaust their $48,600 allowance, is minuscule in proportion.

Second, if candidates are to become less reliant on Super PACs and other outside groups, then measures that make it easier to raise money in a transparent way, and in accordance with contribution limits, could be a beneficial thing.  It is impossible for one organization, party, or even Congress, to control the political messages that make it to the airwaves.  What these organizations can control is who is accountable for the messages that are made, and their level of transparency.   Unlike ad hoc organizations like Super PACs, elected officials and candidates are accountable for the statements they make and their legitimacy is dependent upon it.  Therefore measures that empower candidates relative to outside organizations perhaps deserve a second look by progressives that desire an improved campaign finance system.

 

Super PAC Money: Did it make a difference?

Posted on:

The media and political talking heads spent a lot of time thinking about and discussing the potential effects the Citizens United decision would make on this year’s elections. Now that the votes are in and the victors announced, we can finally determine how big of an impact the one billion dollars in independent money had on Election Day results.

It didn’t seem to make much of one.

More than two-thirds of the one billion dollars spent throughout the election cycle went toward losing candidates. Groups who supported Republican Senate candidates pumped $100 million into seven races, and the Republican candidate lost in each of them. In House races, 24 Democrats and eight Republicans won their elections despite being outspent by their opponents.

Even though “dark money” didn’t play as large a role in winning elections as some originally thought, the Citizens United decision did make the 2012 election cycle different from any past year. Over one million television commercials – the majority of which were overtly negative – aired throughout the year, and candidates were forced to spend an unprecedented amount of time fundraising just to keep up with their opponents.

President Obama, who once again relied on his “small-donor army” and raised more than a billion dollars in campaign contributions, held twice as many fundraisers as rallies during his campaign, and Romney’s camp was still in fundraising mode in late October, mere weeks away from Election Day.

So even if it seems as though money didn’t make a difference, it’s never mattered more in the minds of candidates and campaign teams.

What’s next?

Leader of Super PACs and other nonprofits have proven they have no problem finding wealthy donors and convincing them to write large checks to support certain candidates or issues. But now, since it’s clear that their spending wasn’t enough to win an election, they’ll need to rethink their strategies.

In 2008, President Obama outdid his opponent in the world of social media. His presence on sites such as Twitter and Facebook was more prominent that that of John McCain, and the Internet is one of the primary reasons he was able to surpass $1 billion in campaign contributions.

This year, his campaign found a way to innovate campaign finance once again. Weeks before the election, pro-Obama messaging – complete with a “Paid for by the Obama Victory Fund” disclaimer – encouraged visitors of video websites such as Hulu and YouTube to vote on Election Day.

It’ll be interesting to see if third-party groups follow President Obama onto YouTube and Hulu, hoping that they can make a bigger impact in the next Election cycle.