Real-Time Disclosure — One Simple Fix for a More Informed Public

falling money
Photo: Flickr user 401k

In anticipation of an upcoming decision by the Supreme Court in McCutcheon v. FEC, Congress should enact legislation to mandate near real-time disclosure of hard money contributions to parties and candidates, so that citizens can better gauge whether their elected officials are representing their interests or special moneyed interests. Transparency’s impact is diminished when information about campaign funding is delayed by weeks or months. A less informed public and less accountable system may be the goal of opponents of more disclosure, but it is unacceptable in the Internet era where information about everything other than government is publicly available everywhere, with the tap of a screen or click on a mouse.

James Madison said, “A popular government without popular information or the means of acquiring it, is but a prologue to a farce, or a tragedy, or perhaps both.” To decrease the chance, or at least the speed, with which our government completely devolves into farce or tragedy, citizens must have real-time access to information about the way our elections are financed. Nearly $7 billion was spent on campaigns in 2012. Roughly a billion dollars was the result of spending by “outside” groups. The remainder was financed mostly with so-called hard money contributions made to the candidates, parties and traditional PACs. The source of much of that money was the political 1% of the 1%, the wealthiest citizens whose voice in politics, if measured by spending, far outweighs everyone else’s.

Disclosure of where all that money comes from runs the gamut from nondisclosure of at least $300 million in dark money spent by so-called social welfare organizations on election-related activities, to quarterly reporting by congressional candidates and joint fundraising committees, to monthly reporting by parties and presidential candidates. Since the Citizens United decision, much of the focus — including ours — has been on the seemingly intractable problem of disclosing outside dark money expenditures. However, with the likelihood that the McCutcheon court will again find a way for the wealthiest among us to have an outsized impact on elections and public policy, Congress must update the current disclosure regime to allow citizens to monitor and evaluate, in real time, who their elected officials are actually representing.

If, as many predict, the court uses the McCutcheon case to continue its attack on contribution limits, it will be possible for a single donor to contribute more than $3.5 million to a party’s candidates and committees. And if current laws are not changed to require timely disclosures of such contributions, the public will have to wait months to find out who gave how much to which candidates. If a candidate or elected official knows who is giving to his election efforts in real time, the voters who put him or her in office should have the same access to that information.

Moreover, Congress should not wait until after the McCutcheon case is decided to act on a real-time hard money disclosure bill. As we have seen in the four years since Citizens United was decided, Congress cannot be relied upon to increase disclosures after the Supreme Court has triggered a new way to fund elections. Furthermore, even if the Supreme Court doesn’t undo current limits, candidates are still free to solicit five- or six-figure contributions from the wealthiest members of our society. During the 2012 elections, both presidential candidates solicited (extorted?) access and influence buying contributions of $70,800 from single donors. Delaying disclosure of such large contributions is not necessary from a technical or technological standpoint, nor is it required by the Constitution.

Disclosure of money in politics has long been endorsed and upheld by the Supreme Court because it is a critical tool to inform the electorate, deter corruption and the appearance of corruption, and aid in enforcement of campaign finance laws.

Disclosure Informs the Electorate

In Buckley v. Valeo, the Supreme Court reaffirmed the long held standard that disclosure is necessary to enable the electorate to make informed decisions, noting:

First, disclosure provides the electorate with information ‘as to where political campaign money comes from and how it is spent by the candidate’ in order to aid the voters in evaluating those who seek federal office. It allows voters to place each candidate in the political spectrum more precisely than is often possible solely on the basis of party labels and campaign speeches. The sources of a candidate’s financial support also alert the voter to the interests to which a candidate is most likely to be responsive, and thus facilitate predictions of future performance in office.

Citizens are affected every day — not just in the weeks before an election — by the decisions of their elected representatives, and have the right to know when those decisions are being driven by large campaign contributions. Has a campaign contribution or the access it buys contributed to the introduction of a bill, the tabling of an amendment, or a vote on legislation? Today’s technology allows those asking such questions to determine in real time what, if any, role money played in shaping policy, and allows constituents to react if they determine their representatives are not representing their interests.

In addition to the impact large campaign contributions can have on policy, their impact on who gets elected has only increased since Buckley. The “wealth primary,” in which a candidate is often selected not on the merits of his or her position but on whether he or she can raise sufficient funds to mount a competitive campaign, often takes place a year or more before an election. Real-time disclosure of who is leading the race for cash is critical for voters who wish to respond — positively or negatively — to a candidate’s fundraising efforts in some way beyond going to the polls on Election Day.

Disclosure Deters Corruption and the Appearance of Corruption

Limiting corruption and the appearance of corruption is as important to a functioning democracy as informed voters, and real time disclosure is critical to achieving that goal. (Sunlight is the best disinfectant, after all.) Again, don’t take my word for it. The Supreme Court recognized that:

[D]isclosure requirements deter actual corruption and avoid the appearance of corruption by exposing large contributions and expenditures to the light of publicity. This exposure may discourage those who would use money for improper purposes either before or after the election. A public armed with information about a candidate’s most generous supporters is better able to detect any post-election special favors that may be given in return.

Deterring corruption should not have to wait three months, until after a quarterly campaign finance report is filed. Likewise, it’s not just “post election special favors” that should be detected and deterred, as the Buckley court noted, but favors that take place before an election — or any time an elected official acts in a way that reflects the positions of contributors rather than the wishes of constituents.

Disclosure Aids Enforcement

Even if the McCutcheon court overturns the overall contribution limits to candidates and parties, limits on direct contributions will likely remain. As the Supreme Court has recognized, “recordkeeping, reporting, and disclosure requirements are an essential means of gathering the data necessary to detect violations of the contribution limitations.”

Real-time disclosure aids the enforcement process by ensuring the Federal Election Commission has timely information, by providing a tool for journalists and whistleblowers, and by fostering self-auditing and self-enforcement, as campaigns, parties and donors themselves work to avoid the immediate publicity that would result from real time disclosure of an illegal contribution.

Extending the 48-Hour Notification Period

Current disclosure laws require a candidate’s principal campaign to notify the FEC within 48 hours of all contributions of $1,000 or more it receives during the last 20 days of an election. Recognizing that the impact of large contributions is relevant year round, one simple way to achieve near real-time disclosure is to eliminate the 20-day time frame, mandating 48-hour notification of large contributions whenever they are made. To close potential loopholes, the notification requirements would have to apply to all political committees, including joint fundraising committees, and ensure that the $1,000 threshold is cumulative, to avoid multiple undisclosed $999 contributions.

Opponents of disclosure will object that real time reporting is too burdensome for campaigns. That’s a tough argument to make when candidates running multi-million dollar campaigns already have the software and consultants that enable them to comply with the 48-hour rule in the last, heated, frantic days of an election. The same consultants using the same software can easily extend the scope of their reporting of large contributions so that it takes place year-round.

Greater Disclosure, Not Fewer Caps

Transparency can foster accountability, deter corruption and provide for a better-informed electorate, but, while it is fundamental to our democratic system of government, it is not a panacea for all that ails our democracy. Limits on who can give to candidates and campaigns and how much they can give are still necessary to ensure our elected officials represent all of us, not just those with the means to buy access and influence. Knowing a driver is going 200 miles per hour does not mean it is safe for him to do so. Similarly, knowing a candidate asked for and received a five-, six- or seven-figure contribution from a single donor does not make that candidate less corrupted or corruptible. Limits still matter. But as the attack on contribution limits continues, robust, real-time disclosure can act as a bulwark against the unfettered and wholesale purchase of our elections by the wealthy.

Campaign finance disclosure laws, which have been around for 100 years, require periodic updates to reflect changes that take place in campaigning, fundraising and technology. We are at a period of the perpetual campaign, where fundraising is focused a tiny, super-wealthy portion of the electorate and in which technology allows us to have information available in real-time. Our disclosure laws must reflect modern realities if they are to adequately serve voters’ right to information about who is paying for our elections. Disclosure of large contributions online, in real time, is a necessary, obvious and simple update. As Mitch McConnell, no friend to campaign finance laws, once noted, “We need to have real disclosure… why would a little disclosure be better than a lot of disclosure?” It’s time for a lot of disclosure.