The controversy over the Internal Revenue Service's handling of applications for non-profit status from Tea Party groups has put a spotlight on a subject with which we at the Sunlight Foundation Reporting Group are all too painfully familiar: The migraine-producing complexity of the nation's campaign finance system. To shed some light on the ongoing debate, we've decided to share what we know.
As often is the case with systems worthy of Rube Goldberg, it's easier to draw than to describe.
News that individuals at the IRS improperly targeted certain groups for scrutiny thrust DC’s “House Cleaners” into high gear. Indignant talking points have been drafted, hearings have been announced, and heads will roll. (Already, Acting IRS Commissioner Steve Miller was forced to hand in his resignation).
But what happens after the dust settles and is swept away? In terms of public policy about campaign finance transparency, there could be a silver lining, but only if the outrage is channeled into reform efforts. So far, hearings have been scheduled by Representatives Issa and Cummings of the House Oversight and Government Reform Committee (who would do well not to lose sight of the “reform” mission embedded in the name of the committee) Representatives Camp and Levin of the House Ways and Means Committee, Senators Baucus and Hatch of the Senate Finance Committee, and by Senate Permanent Subcommittee on Investigation’s Levin and McCain—the latter the “maverick” reformer who hasn’t put his name on a significant piece of reform legislation since the Bipartisan Campaign Reform Act of 2002. Each of those Members should acknowledge—during their hearings and beyond—that underlying the IRS actions is the real and dangerous problem of political organizations masquerading as social welfare organizations, impacting elections with hundreds of millions of dollars in dark money expenditures.
As many as 600 individuals appear to have exceeded the $117,000 that they were legally allowed to give directly to federal candidates, political parties and political committees in the last election cycle, records examined by the Sunlight Foundation suggest. But our most troubling finding may how difficult it is determine with legal certainty exactly how many campaign scofflaws there are, or how much over the limit they gave.
Like our former Sunlight colleagues, Paul Blumenthal and Aaron Bycoffe of the Huffington Post, we have been curious about the number of donors who appear to have exceeded campaign spending limits, in an era when the Supreme Court has made it possible for wealthy individuals to give in unlimited amounts via super PACs.
In addition to those who violated the overall limit for giving to federal campaigns, we identified as many as 1,478 individuals who may have given more than the legal limit of $70,800 to parties and committees and 507 who appear to have given more than the $46,200 legal aggregate limit to individual candidates.
This week, Senators Wyden and Murkowski introduced S. 791, the Follow the Money Act, their bipartisan effort at disclosing money in politics. The bill would require groups spending $10,000 or more on election-related activity to register and disclose contributions above $1,000. The bill would also raise the threshold for contributor disclosure by candidates and political parties from $200 to $1,000.
New ideas and new voices are welcome in the effort to expose dark money in the political process. Congress should be alarmed that shadowy groups spent $1.2 billion on election-related activity in 2012, and a decision about the best way to shed light on the donors behind that money should not be based on a crass political calculation about whether the secret expenditures were worse for the other party. Democrats and Republicans alike should recognize that dark money is bad for democracy—buying access and influence to elected officials, funding negative and misleading ads that turn off voters, and taking the message of a campaign out of the candidates’ control.
Elected officials on both sides of the Capitol should follow the lead of their colleagues who are working towards bipartisan consensus on disclosing dark money.
Just in time for next week's special city council election, Sunlight is sneak-previewing our latest addition to Influence Explorer — DC campaign finance data — as well as our wish list for how it can be made better.
With the U.S. Senate expected to take up gun legislation next week and recent passing of gun laws in Connecticut, Colorado and Maryland, we put together a tool kit on the issues around gun rights and gun control. For more information, you can follow the money, influence and news on the issue of gun control and gun rights in the U.S. at our resource page.
Keep reading for information about state legislation, swing votes in the Senate, political spending by gun rights and gun control groups, details on how they lobby Congress and where they are airing TV issue ads.
I recently returned from Croatia, where I was invited to speak about what works and what doesn’t in terms disclosure of money in politics in the United States. I was certain that the portion of my talk advocating disclosure of all election-related spending would lead to questions about whether, in some cases, anonymity is necessary to protect those who want to make financial contributions for election related activities. After all, Croatia is in a part of the world where, until recently, exercising one’s right to free speech could have serious consequences. I had come armed with answers to respond to questions about whether some level of anonymity associated with political contributions is ever appropriate.
My answers remained in my briefcase. I did not need to share that even the extremely conservative Justice Scalia understands that, "harsh criticism, short of unlawful action, is a price our people have traditionally been willing to pay for self-governance. Requiring people to stand up in public for their political acts fosters civic courage, without which democracy is doomed." For this audience, it was a given that the sources of money behind election-related activities must be public. Needless to say, the acceptance of disclosure by those attending a conference on election innovations does not make transparency a region-wide or even a countrywide trend. But that no one even raised the issue of anonymity as a necessary condition for financial political participation was a stark and telling contrast to the debate over dark money in this country.
Since the Citizens United decision, there has been a vocal camp decrying disclosure, despite the Supreme Court’s own recognition that “disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way [and] transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.” But compared with the recent and real histories of new and emerging democracies, where free speech has been met with government intimidation, harassment and punishment, the parade of horribles spelled out by Mitch McConnell and others seems almost laughable.
In this country, there are protections for those who can establish a real and legitimate threat as a result of their positions. The Socialist Workers Party, for example, has for years asked for and received an exemption from having to report its contributors based on demonstrable harassment. Such exemptions, given on a case-by-case basis, are narrowly tailored to address actual harm and are a far cry from McConnell’s proposition, which would grant blanket anonymity to corporations and wealthy individuals to protect them from harsh criticism and potential boycotts of their products. (Never mind that boycotts and criticism are also protected by the first amendment.) Pre-emptive anonymity as a method to stave off any possible bad reactions is not only unnecessary, but it places all political speech on a slippery slope toward secrecy. Why stop with dark money? If we are willing to provide contributors to outside groups with blanket protection for phantom threats, shouldn’t all contributors to political candidates and parties be similarly hidden from public view?
For those of us who work on political finance transparency issues in the U.S., it is disheartening to have protect against a system of clandestine influence buying while, at least to us, it appears that parts of world where secrecy had been the norm are now moving towards greater transparency. On the other hand, perhaps it is a matter of perception. Do newer democracies look at the U.S. as at least having a system of disclosure, however flawed? In some countries, is the issue of political finance transparency so new that any debate around the issue of anonymity is yet to come? For those of you exploring political finance transparency around the globe, we’d love to start a dialogue. Please share your experiences, thoughts and perceptions in the comment space below.
As voters go to the polls in today's primary contests for a South Carolina special congressional election that has garnered attention for its share of colorful candidates, the donors appear just as just as worthy of a second look.
That's not just because the donors are, in most cases -- the candidates themselves. They also include a diverse range of out-of-staters from infamous dark money man David Koch to comedian Stephen Colbert's wife, as Sunlight has reported.
In the final days before polls opened, donations continued to pour in. We're keeping tabs using our Follow the Unlimited Money alert service that sends us emails every time one of the committee's we're watching files with the Federal Election Commission.
Most of the late cash has gone to former South Carolina Gov. Mark Sanford, who is trying to make the political comeback of a lifetime just two years after departing office in disgrace. Revelations of Sanford's extra-marital affair with his Argentine lover (now fiance) ended his marriage but not, it now appears, his once-promising political career. By late last month, Sanford was already the dollar frontrunner in the contest to replace Tim Scott, a Republican appointed to the Senate this year. That financial momentum has only continued to build with more late contributors jumping on the frontrunner's bandwagon.
In the 20-day period before today's primary, Sanford raked in $80,050 in contributions of $1,000 or more, bringing him to a total of at least $414,447, according to Federal Election Commission reports. Combined, the six leading Republicans and the Democrat most likely to win her primary, Elizabeth Colbert Busch, have raised over $3 million so far in the race.
It’s axiomatic that the Sunlight Foundation believes transparency can deter corruption, foster accountability and increase the public’s participation in government. But that is not to say that in all cases transparency alone is sufficient to ensure a cleaner, fairer democracy. That is why it is troubling when people in the position of shaping public debate blithely remark that contribution limits should be tossed out in exchange for greater transparency.
David Axelrod, the president’s former top strategist and newly minted NBC pundit did just that through a series of tweets. As compiled by Politico, Axelrod tweeted, “Campaign finance system is a mess. Limits have just created a cottage industry for lawyers who devise schemes to circumvent them. Too much money in politics. But if it’s inevitable, let it flow directly to candidates and demand full disclosure, with stiff penalties. And end the SuperPac and faux SuperPac game that too often allows donors to elude detection and candidates to deny responsibility."
Too much money in politics. But if it's inevitable, let it flow directly to candidates and demand full disclosure, with stiff penalties.2/3
— David Axelrod (@davidaxelrod) February 20, 2013
Exchanging candidates’ unfettered access to the deepest pockets for greater transparency is not a fair trade. We need disclosure and limits. Knowing a driver is going 200 miles per hour does not mean it is safe for him to do so. Similarly, knowing a candidate received $100,000 or $1,000,000 from a single donor does not make that candidate less corrupted or corruptible. Nor does it foster any faith in our system. As the Supreme Court noted in Buckley v. Valeo, contribution limits are one of the law’s “primary weapons against the reality or appearance of improper influence” on candidates by contributors. The Court found that these limits “serve the basic governmental interest in safeguarding the integrity of the electoral process."
A campaign finance system that permits unlimited contributions to candidates would encourage an arms race between candidates, each promising access and influence to any sugar daddy willing to fork over a six or seven figure contribution. A plutocracy would evolve, with voters’ and small donors’ voices drowned out by the amplifying power of unlimited contributions from a few.
We share Axelrod’s frustration with the current dark money system and understand that only the thinnest veneer exists between third party groups and the candidates they support. But rather shredding that veneer, laws should adopted to fortify it. As a first step, Axelrod’s own proposal of “full disclosure, with stiff penalities” should apply to the Super PACs and 501(c) groups that engage in political activities with unlimited funds. The DISCLOSE Act would have provided such disclosure, had it not been killed in Congress. (It should be noted that, consistent with his continued disappointing actions on transparency and reform, the president failed to use any political capitol to ensure passage of a robust dark money transparency bill.)
Our campaign finance and disclosure system is in desperate need of repair. But giving up on it is not the answer. We need to shine a bright light on all the money already in the system, without opening up the floodgates for still more.
Today, Senator Tester announced that once again he has introduced the Senate Campaign Disclosure Parity Act, (not yet online) a bill that would bring the Senate into the 21st Century by requiring senators and Senate candidates to electronically file their campaign finance reports with the Federal Election Commission.
The current filing system in place in the Senate would laughable if it weren’t so destructive to disclosure. Senate candidates file their quarterly campaign finance reports with the Secretary of the Senate, who prints them out on reams of paper to be delivered to the Federal Election Commission. The FEC then inputs the information contained in those reports into its computer databases. Transparency delayed is transparency denied. The Senate system is anathema to anyone who supports meaningful disclosure.
House candidates and presidential candidates, by contrast, have been electronically filing their campaign finance reports for over a decade—streamlining the process and saving taxpayer money. It is estimated that the duplicative paper filing system in place in the Senate costs up to a half a million dollars annually.
Versions of the Senate Campaign Disclosure Parity Act have been introduced with significant bipartisan support in multiple prior congresses. No Senator that we know of has ever publicly opposed the legislation. The only reason the bill is not law is because it has been used for partisan political squabbles. As the Senate struggles with massive challenges facing the country, from sequestration to guns to immigration, perhaps this year Senators can finally agree to enact a bill that no one can disagree with.
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