Eight groups, including the Sunlight Foundation, sent letters to the House and Senate, urging Members of Congress to adopt legislation closing down the loophole that allows so-called social welfare organizations to engage in political activities. The murky law was at the root of the controversies surrounding the IRS’s improper targeting of certain groups’ applications for 501(c)(4) status.

At congressional hearings this week, many members of the Senate Finance Committee and House Oversight and Government Reform Committee raised the issue of fixing the broken IRS rules that allow social welfare organizations to engage in substantial electioneering activities. Many noted that engaging in campaign activities is explicitly contrary to the law that says such organizations must engage “exclusively” in social welfare activities. Campaign activities are not “social welfare” activities.

If it results in a clarification of the law, the IRS debacle will have a silver lining. But there is still a great deal of resistance to efforts that would ensure that groups that engage in political activities disclose their donors. Chairman Issa of the House Oversight and Government Reform Committee rejected the idea that it was appropriate for his committee to address the question of any possible fixes—begging the question: what happened to the “reform” part of his committee? And in the Washington Post today, Senator Mitch McConnell uses the IRS case as a twisted justification to endorse dark money in our elections. His sanctimonious criticism of transparency measures ignores Supreme Court precedent as well as decades of support (including his own) for disclosure as a narrowly tailored method to address political corruption.

(It’s also remarkably hypocritical that McConnell would use the 1958 Supreme Court decision in Alabama v. NAACP to justify his position. That case prohibited government mandated disclosure of membership lists--not campaign finance records--when, on balance, threats to the group’s first amendment rights were thought to outweigh the public’s interest in disclosure. McConnell was less than concerned about the NAACP precedent when, under his direction, he repeatedly blocked an electronic filing bill in the Senate by insisting on an amendment that would require membership organizations disclose their members’ names any time a group filed an ethics complaint against a sitting senator. Apparently McConnell has his own balancing test, heavily weighted towards his own interest as opposed to the public interest.)

Narrow changes to tax law would ensure that groups intending to impact our elections disclose their donors, while fully protecting the anonymous speech of organizations that are legitimately engaged in social welfare activities. Clarifying the laws would also decrease the likelihood of future instances of improper targeting by the IRS.

The Washington Post reported today that the SEC is issuing subpoenas to investigate the possibility that a “political intelligence” firm used congressional sources to gather insider information about health care funding, launching a surge of trading in health companies after the nonpublic information was made available to Height Securities, a stock brokerage firm.

Subpoenas, lengthy investigations and anonymous sources are one way to get to the bottom of whether some lucky investors used insider information from Congress to profit from timely stock trades. But here’s another thought. What if Congress enacted disclosure laws to help enforce rules against insider trading? What if political intelligence professionals were somehow required to publicly disclose their clients and the issues they are working on, the same way registered lobbyists have to publicly disclose information about their work? Seems like such disclosures might help cut to the chase, streamlining investigations and maybe even providing a check on the system to prevent the possibility of insider trading on congressional information in the first place. Too bad no one ever thought of that.

Oh wait. Someone did.

The original incarnation of the STOCK Act mandated disclosures by political intelligence professionals, and, in both the House and the Senate, had enough votes to pass. But even a majority in favor of greater transparency was not enough to save the political intelligence disclosure provisions. Even before their most recent slash and burn attack on the STOCK Act, which gutted the bill’s disclosure provisions, Eric Cantor bowed to pressure from Wall Street and stripped the political intelligence language from the bill before allowing it to come to a vote. Rather than holding firm on its own stronger version of the bill, the Senate simply took up the weaker House version.

And now the SEC is questioning Mark Hayes, a lawyer who served for seven years under Senator Grassley as Health Policy Director and Chief Health Counsel for the Senate Finance Committee. We don’t know the full extent of the relationship between Hayes and Height Securities, or whether Height had multiple sources feeding it information from Congress—mandatory disclosures would probably help clear that up—but an email from Hayes to a Height Security analyst said that a “high-level deal had been made that would provide a benefit to health insurers.” Soon after, the surge in trading on health company stocks began.

It often takes a scandal to convince Congress to act. Perhaps the SEC’s investigation will result in enough outrage that a bill providing disclosure of political intelligence activities can be signed into law.

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.

Last week, freshman Rep. Ann Wagner, R-Mo., introduced the Focusing the SEC on Its Mission Act (H.R. 1626). If passed, the bill would prohibit the Securities and Exchange Commission from issuing rules requiring the disclosure of corporate expenditures for political activities.

The bill is an explicit attempt to negate a proposed rule that has been gaining momentum and public support since last year. The rule, which would "require public companies to disclose to shareholders the use of corporate resources for political activities," recently racked up half a million public comments, a record for the SEC. The rule would represent a step towards shedding light on the flood of dark money that has recently overwhelmed American elections.

The bill was just introduced last week and hasn't garnered much press attention yet. I was able to discover it thanks to Scout, Sunlight's legislative tracking tool, and a custom alert that tracks bills that change the Federal Election Campaign Act of 1971.

It remains to be seen if the bill will gain traction in Congress, but it is surely worth keeping an eye on. Since court opinions that made it easy for wealthy individuals and corporations to pump huge sums of money into political campaigns, Republicans in Congress have flipped their opinions on disclosure and could push this legislation as a way to keep political money in the dark.

If you're interested in following this, or any other, legislation sign up for a Scout account and get tracking!

(Photo credit: U.S. House of Representatives) 

Last week the Senate, House, and President Obama came together to continue their history of poorly thought out, bipartisan action on the STOCK Act.

The legislation, signed by President Obama earlier this week, specifically targeted two sections of the law. Section 8, which deals with disclosure and reporting for members of Congress and their staff, and Section 11 which deals with disclosure and reporting for executive branch employees.

The legislation ensures that most federal employees will not see their personal financial disclosure documents posted publicly online. These documents are already public information. Keeping them off the internet for the sake of "security through obscurity" sets a bad precedent by making public information effectively inaccessible.

Members of Congress, the President, Vice President, candidates for those offices, and certain high ranking executive branch officials would still have their disclosures posted online. But, provisions in the law would basically nullify the effectiveness of online disclosure.

The law does not require high ranking officials and members of Congress to file their personal financial disclosures electronically, it merely allows them to if they so choose. Even worse, while the disclosures will still eventually make their way online, the new law ensures that they will not be searchable, sortable, or particularly useful to anyone.

We have created a redline version of the STOCK Act showing exactly how the new law changes the original legislation. The action starts on page 4.

STOCK Act Redline

As of midnight last night, candidates for federal office were to have filed their campaign finance disclosure reports with the Federal Election Commission. These reports contain crucial information that lets voters know which special interests, big-money lobbyists or out-of-state donors may be funding a candidate’s campaign. The reports are supposed to be public, but if you try to find Senate candidates’ reports today, you will be out of luck. Why? Because the Senate has exempted itself from filing directly with the FEC, instead using the Secretary of the Senate as an intermediary. And instead of filing their reports electronically, like House candidates and presidential candidates have been doing for years, Senators and Senate candidates mail or hand-deliver paper printouts of their electronically generated reports.

After receiving the reports, the Secretary of the Senate must scan, page by painstaking page, thousands of pages of campaign finance reports before transmitting them to the FEC. It may be days or weeks before the FEC receives the reports—longer for the ones that are mailed rather than hand delivered, as the mailed reports don’t even arrive at the Secretary of the Senate’s office until they have been processed off site.

But wait, there’s more. After it receives the scanned documents, the FEC must then spend about $450,000 in taxpayer dollars and untold hours having the records typed in, line-by-line, to the FEC’s databases. It will take at least three weeks before the information is publicly available—longer in the middle of a busy election season. The process isn’t just inefficient. It denies citizens timely access to information that can help shape and inform their opinions about their candidates and elected officials.

Senator Tester and Cochran have repeatedly introduced legislation to streamline the process and make electronic filing mandatory. This Congress, a bipartisan group of 30 senators have cosponsored S. 375, the Senate Campaign Disclosure Parity Act, with many others voicing support for the measure.

Despite its overwhelming support, the bill has not become law because some in the Senate have chosen to make it a political pawn. That is why we urge every Senator who supports transparency and government efficiency, as well as every one who opposes government waste, to cosponsor the bill. Overwhelming, demonstrated support may be the best chance this common sense piece of legislation to pass.

The Sunlight Foundation's sister organization, the Sunlight Network, is organizing Citizen Advocacy Day, an exciting opportunity for citizens to let their members of Congress know how important a transparent government is to them. The event will take place May 6, the day after what is shaping up to be an eventful, fun and informative TransparencyCamp.

Citizen advocates will have a chance to talk to key policy staff for their Members of Congress about important transparency issues, like smarter open data through the DATA Act, making sure the Senate keeps up the with the times by mandating electronic filing of campaign finance reports and getting more disclosure about lobbying and the financial interests of members of Congress and their staff.

Sunlight will brief citizen advocates (and feed them breakfast!) the morning of the Advocacy Day to arm them with talking points about key transparency related priorities.

Sunlight advocates on ways to improve transparency of government information but we can’t do it alone. Become a Citizen Advocate and help shine a light on our government.