Citizens United

 

Is the U.S. Backtracking on Political Finance Transparency as Others Move Forward?

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.

Obama's Outside Group Still Lacking Disclosure

The Center for Public Integrity has an important story today on Organizing for Action's money in politics problem:

Organizing for Action, launched by former Obama campaign officials earlier this year, confirms it will not publicly release donors' employer and occupation data despite collecting it through its online donation form.

Lisa Rosenberg made a similar observation recently, in adding incomplete disclosure to the list of problems with the President's dark money group. To reiterate: OFA allows the President to accept unlimited donations (in the name of grassroots organizing), to build political power for the President, while avoiding the reach of campaign finance laws.

Here is President Obama in 2010 (video, transcript), talking about the DISCLOSE Act:

These shadow groups are already forming and building war chests of tens of millions of dollars to influence the fall elections. Now, imagine the power this will give special interests over politicians.  Corporate lobbyists will be able to tell members of Congress if they don’t vote the right way, they will face an onslaught of negative ads in their next campaign.  And all too often, no one will actually know who’s really behind those ads.

Now it's 2013, Obama has his own "shadow group." We already knew OFA's "voluntary disclosure" was ultimately unreliable. (It's voluntary, and there's a reason campaign finance laws aren't designed to be self-enforcing. On top of that, even if they know the donor's identity, donors are still quite capable of laundering their donations.)

And now we get official confirmation that even though OFA collects important information about donors, and they plan not to release that information publicly.  Why would Obama's group want to know this information, while at the same time keeping it from the public? Why does the President seem to have no plan for OFA's structure, apparently making it up as they go?

The President who was so concerned about the corrupting effects of unlimited contributions is surprisingly unconcerned about the effects of unlimited contributions on himself, and his c4 reflects it. OFA's ability to broker access to the President and tap into large donors is only being held back by the threat of public blowback, and not at all by any Presidential sense of accountability. If OFA's structure were motivated by accountability, we'd see a coherent policy about campaign finance disclosure, empowering public oversight of his group's finances and donors. Instead, we see conflicting messages about what kind of access a $50K donor can expect, and a disclosure policy that exists only in proportion to public outrage about Obama's dark money.

President Obama should be leading the way in creating accountability in our politics. Instead he's leading politics to a place with little accountability.

 

 

Obama Versus Campaign Finance Laws

There's a certain conventional wisdom that President Obama wants stronger campaign finance laws, and to protect our democracy from the corrupting effects of money in politics.

It's a story that you should no longer believe.

The arc of the Obama presidency may be long, but so far, it has bent away from transparency for influence and campaign finance, and toward big funders.

There's the obvious examples, like promising (and failing) to put healthcare negotiations on C-SPAN, only to negotiate a secret agreement with a segment of the industry the reform effort sought to regulate.

But there's a longer pattern here too. Obama came to power as the outsider who would return merit to public policy, and raise up regular citizens' voices in the process, at the expense of the moneyed interests whose power had displaced regular people. (My career was kick-started, in part, by helping to inspire an amendment to a 2006 Senate bill sponsored by Obama and Salazar, an idea emerging from a series of blog posts on Daily Kos.)

Obama was the standard bearer for post-Citizens United reform, sparring with Republican Senate opposition to ultimately fall a vote short of passing the DISCLOSE Act. 2010 was the high point for Obama's campaign finance rhetoric, where weekly speeches and Rose Garden addresses sought to affirm the dangers of dark money, and the need to understand whose money is buying Washington.

How far we've come.

Since then, Obama embraced superPACs and c4s, the vehicles of newly deregulated influence-buying, suggesting that they were a necessary evil, and suggesting that the only alternative would be unilateral disarmament. A reluctant participant in a rigged game. The rationale didn't ring true even then -- the weak disclosure for these groups was justified by appeals to the same broken laws Obama spent 2010 railing against.

Then came the inauguration.

Obama reversed his policy of limiting donors for the inauguration celebration, and failed to post donation amounts online. (George W Bush had amounts and ranges online for his inauguration donors). He sold access to the inauguration, and to the Presidency, to corporate donors, wheedling their way into the privileged positions that move their policy agendas forward. Obama did this for a series of parties, with no public interest justification whatsoever, and didn't disclose donor amounts. The transparency President couldn't publish donor amounts on the internet -- of corporate donors. Private citizens can make hundreds of GIFs of a comical Rubio water swilling incident within 3 minutes, but the President of the United States can't post corporate donation amounts online.

Transparency President no more.

And now we've got the new c4. It's hard to overstate how bad this new policy is for campaign finance. Today's LA Times (via Democracy 21) explains that Obama's new c4 has been set up to sell direct access to the President, for huge sums of cash, which will be disclosed online, quarterly, without specific dollar figures. The President who told us that secret money in politics undermines democracy has now created a huge funnel for donations, with accompanying disclosure that would have been considered cutting edge in 1992. Quarterly disclosure in ranges is the kind of disclosure you create when you don't want to be seen. This should be a policy innovation Obama is remembered for -- a return to soft money and unlimited donations outside the confines of campaign finance law, with instant access to the White House for the most well-heeled donors, all, incredibly, in the name of empowering the grassroots. It's more egregious, direct, (and potentially corrupting) than the similar efforts of recent Presidents who came before him, an evolutionary step forward for money in politics that is more legal, more normalized, and more powerful than it was before.

Maybe Obama has stopped talking about Citizens United because he's learned to use it to his advantage. Maybe his campaign finance rhetoric was fake all along, donning the visage of a reformer. It doesn't matter.

Obama is taking on money in politics by getting more money into his politics.

Obama has done valuable things for transparency. There are innovations that create value for everyone, and many good people in the White House have created valuable things that continue. But we should be clear about Obama's position on transparency when it comes to his political power.

It's time to stop worrying about how Obama can help fix campaign finance, and instead worry about how we fix what he's created.

 

 

Roundup of Recent Revolving Door Work

The old Washington habit of using government positions and relationships to a land a lobbying gig continues to make news. Sunlight's Nancy Watzman took a close look at gun lobbyists and Bill Allison discussed the new revolving door created by the Citizens United Supreme Court decision.

Earlier this week CNN interviewed Sunlight's Kathy Kiely about Rep. Jo Ann Emerson (R - MO) departing congress to head the National Rural Electric Cooperative Association that Sunlight reported on in December. Also be sure to check out Sunlight's Post-Employment Lobbying Tracker. Watch the CNN clip below:

A look at money, transparency and policy since Citizens United v. FEC

The Citizens United v. Federal Election Commission Supreme Court ruling has left an indelible mark on U.S. politics. Since the January 2010 ruling outside groups and organizations have been able to promote their own special interests with neither accountability nor transparency. In the past three years, we've seen a flood of secretive money, the formation of super PACs and little done in the way of policy to reveal the source of the funding.

Our timeline breaks events into four categories: Courts (major court rulings and cases), Disclose (legislation around greater disclosure of political contributions and spending), Super PACs (trend and news for independent expenditure only committees) and FEC (decisions made by the Federal Election Commission).

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New York Proposed Regulations Move Toward Greater Campaign Finance Disclosure

Yesterday, New York Attorney General Eric Schneiderman attempted to throw down the gauntlet on campaign finance disclosure regulations for New York state. The prime target? Nonprofit profit organizations, labor unions, political action committees and other entities that engage in election advocacy at the federal, state, and local level.

If approved, Schneiderman's new regulation would require any organization spending $10,000 or more on a New York election to publicly report itemized schedules of expenses and contributions, including the name and address of the recipients of the expenditures, and "a clear description" of the purpose for the expense. For this kind of disclosure to be truly transformative, two outstanding issues from the draft proposal should be addressed.

1. Make that Real Time, Online Disclosure -- Although it proposes that all disclosure reports will be published online on the Attorney General's website, the current text of the proposed regulation only requires annual disclosure of electioneering activities. One filing per year online is an unreasonably low threshold for disclosure of activities that are ongoing, critically related to one of our most vital democratic institutions (our elections!), and in the public interest to be reported in a manner that’s as timely as the activity. When you measure the potential burden of filing more regularly against the public interest in timely disclosure, technology has changed the balance: The best target to shoot for is real-time online disclosure of key influence data.

2. Close the Exemption Loophole -- The proposed legislation exempts those organizations who already publicly disclose information to other government agencies from filing with the state Attorney General. Although it’s appropriate to guard against redundant requirements, more thought should be put into the potential consequences of this provision. Just because organizations are reporting to other government entities does not mean that the reporting and disclosure these agencies already require is as detailed or timely as what the Attorney General’s office plans to disclose. Nor is there any guarantee that this provision will be interpreted as its meant or that the disclosed information will be easily accessible. New regulations should create reliable disclosure requirements that create a meaningful window into political activity regardless of whatever laws already exist.

Schneiderman is authorized as the Attorney General with statutory authority to oversee nonprofit organizations -- many of which played a big role in this year’s elections -- and his regulatory approach is a creative answer to Congress’s failure to act. As Attorney General, Schneiderman is charged with defining the form and manner in which organizations make annual financial reports to the state and to enact rules and regulations to administer the financial reporting system. Just as it is within his purview to address issues of influence in the political system, Schneiderman can make changes that reflect the best practices of online disclosure and to require necessary and appropriate timelines for doing so. At one time, requiring real time, disclosure may have been a burden, but with the bevy of online tools (including the NYOpenGovernment.com website that Schneiderman himself created earlier this summer), closing the gap between electioneering activity and public notice has never been easier.

As our nation’s campaign finance transparency laws continue to be attacked and weakened, it’s refreshing to see a new, viable proposal that has promise to bring new information to bear on elections that are increasingly taking place in the shadows. The proposed regulations will be published in the New York State Register on December 26th and will be subject to public comment until March 6, 2013. We hope the public takes the chance to address these and other issues at that time and supports Schneiderman’s proposal.

You can read the full text of the proposed regulations here.

Another way to look at money in politics: Its impact on partisan control of state legislatures

As we continue to debate the impact that money had on the 2012 federal races, along comes a very intriguing paper that looks at the question of spending a bit differently. And finds some rather significant effects.

Instead of looking at the impact on individual candidates, Andrew B. Hall, a Ph.D. candidate at Harvard, has looked at the relationship between funding levels and partisan control. And he’s looked at the impact on the state level, and looked at it over several decades. All of which makes his paper, “Aggregate Effects of Campaign Spending” a worthwhile read.

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Hey Big Spender...

... spend a little time with me after Election Day?

With the most expensive election in history behind us, the outsized footprint of dark money remains on our political landscape. While "spending by outside groups reached new heights, the amount the public knows about the sources of that money reached new lows," opined Ellen Miller, Executive Director of Sunlight Foundation. And the dark money spigot is not expected to turn off anytime soon. Join Ellen and a distinguished panel of experts on Friday, Nov. 16 at 9:30am, to assess the political implications of dark money in the 2012 election as well as its influence post Election Day.

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States Take On Citizens United

Frustrated by the inability of Congress to address the Citizens United decision, voters in Montana, Colorado and Massachusetts took the issue on themselves and by overwhelming majorities voiced their opinion that corporations should not have the same free speech rights as individuals.

In Montana, 75% of voters directed the state’s congressional delegation to propose a constitutional amendment overturning the Citizens United decision. In what seems eminently rational, the amendment stated that “the people of Montana regard money as property, not speech.” It went on to say that “there should be a level playing field in campaign spending that allows all individuals, regardless of wealth, to express their views to one another and their government.”

By similar margins, Colorado voters supported a referendum urging the state’s representatives in Congress to support efforts to overturn the Citizens United decision.

Finally, language appeared on the ballot in 170 Massachusetts towns that called on Congress to amend the Constitution to affirm that “corporations are not entitled to the constitutional rights of human beings,” and “both Congress and the states may place limits on political contributions and political spending.” Seventy-nine percent of voters who had the chance to weigh in on the ballot initiative supported it.

Although not binding, the initiatives gave voters a chance to express their disagreement with a system that gives corporations a louder political voice than individuals. Voters know that $1 billion in spending by SuperPACs and secretive nonprofits distorts the political process. They know the dangers of dark money include access to elected officials—the kind of access Chevron purchased with its $2.5 million contribution to a the Congressional Leadership Fund, a Super PAC supporting House Republicans. They know that there is a real threat to democracy when elected officials are willing to consider doing the bidding of deep-pocketed corporate donors in order to stave off future dark money attacks.

Although the ballot initiatives supported a constitutional amendment to address Citizens United, there can be no doubt that during the intervening period, voters would strongly favor greater disclosure of dark money through enactment of legislation like the DISCLOSE Act. Getting dark money out of politics is a multistep process. Voters in Montana, Colorado and Massachusetts took the first step.

Court Decision Should Embolden More Action on Transparency

Last week, the US Court for the District of Columbia rejected a challenge to a longstanding federal law that bans federal contractors from contributing directly to candidates in federal elections. The decision by the court recognizes the constitutionality of imposing restrictions on political contributions in order to prevent corruption and the appearance of corruption. It should embolden legislative and executive branch efforts towards greater transparency, specifically disclosure of dark money contributions by federal contractors.

As the law currently stands, federal contractors who are prohibited from giving directly to candidates may use the wide-open back door provided by Super PACs and 501(c) groups to funnel unlimited contributions to elections. Because there is no disclosure in place, we don’t know how much of the $1 billion of outside money in this election came from federal contractors or what those contractors might expect in return for their investment.

There are two avenues to achieve disclosure of dark money by federal contractors. The first is legislation, like the DISCLOSE Act. If courts are willing to uphold legislatively created bans on contributions from contractors as constitutional, the much more minimally invasive approach of disclosure would also be upheld.

The second option for disclosure of dark money contributions by federal contractors is a presidential executive order requiring anyone who receives a government contract, grant or loan to disclose political contributions to third parties engaged in electioneering communications. A draft executive order requiring such disclosure has been languishing on the President’s desk for too long. To demonstrate his commitment to transparency in his second term, President Obama should issue that order immediately.

The receipt of taxpayer dollars in the form of a federal contract always comes with conditions, including reporting requirements. Disclosure of dark money contributions is a minimally intrusive yet critical tool to provide an additional layer of accountability in the contracting process.