In the News
Cato: Staring at the Sun: An Inquiry into Compulsory Campaign Finance Donor Disclosure Laws
By Eric Wang
Since the Supreme Court’s 2010 decision in Citizens United v. Federal Election Commission, proponents of stricter campaign finance regulation have increasingly prescribed “disclosure” as an antidote to “dark money” in politics. Advocates of more extensive donor disclosure laws typically invoke Supreme Court Justice Louis Brandeis’s famous maxim that “sunlight is said to be the best of disinfectants,” but they seldom acknowledge the harm of excessive sunlight.
This paper urges a more critical and balanced look at the issue, especially concerning disclosure requirements for independent political speech (i.e., speech that is not coordinated with candidates). Of primary focus is the Court’s jurisprudence in this area, which is often invoked to support additional compulsory donor disclosure laws but lacks coherence, especially as it applies to independent speech. Even assuming that the Court’s jurisprudence in this area remains sound, many arguments being advanced for compulsory donor disclosure laws are untethered from the justifications the Court has articulated, rendering them especially susceptible to challenge in litigation. This paper concludes with recommendations on how, and how not, to enact disclosure laws.
New from the Institute for Free Speech
Out-of-State Spending Was a Tool for Local Change in Alabama
By Joe Albanese
Without outside help, it’s not guaranteed that the “anemic” state Democratic Party would have had the resources and infrastructure necessary to fully take the fight to Moore. The funding and manpower provided by the Democratic Party and liberal activist groups from across the country were surely determining factors.
Situations like these offer an opportunity to reflect upon the fact that “out-of-state” political spending can be an important – and positive – influence in elections. A U.S. Senate election can send a new representative to Congress to make laws that the rest of the country must follow. That means people around the country have some stake in electoral outcomes – activists, donors, everyday citizens, and political junkies alike have an interest in advancing their values and ideas nationwide…
Many people decry out-of-state political spending as something that’s corrupt – a manifestation of powerful outsiders trying to interfere in local affairs. In reality, it is still voters who decide which candidate takes office – indeed, Jones also raised more money from Alabamians than Moore did. Out-of-state spending is simply a powerful tool for introducing voters to different ideas and advancing arguments.
Censorship and Privacy: Lessons from Alabama
By Alex Baiocco
Alabama Secretary of State John Merrill bragged in a press release that he successfully pressured a private company to take down a political ad because he viewed the ad as “misleading.” …
Whether one voted or not is, in fact, public record. Taken at face value, the ad is accurately informing voters of this fact. But it is also easy to understand the Secretary of State’s concern that many voters would interpret this ad to mean that whom they vote for is also public record. It is not, and Secretary Merrill worried that such an interpretation would dissuade Alabamians from voting due to “fear of retribution for how they chose to cast their ballot.” …
[N]o public official should have the power to prevent the public from hearing this speech. Indeed, the Alabama Secretary of State does not (officially) have that power. But the fact remains that an elected official used his position to effectively censor an ad that opposed his party’s candidate in a U.S. Senate race…
Unlike the sacred secret ballot, donations as small as $200 to federal candidates are public record, and the searchable government database where this information is stored includes donors’ names, home addresses, occupations, and employers.
The exact same concerns expressed by Secretary Merrill regarding “fear of retribution” deterring participation apply equally to donor disclosure.
Wisconsin John Doe
USA Today: Governmental accountability board? More like Wisconsin’s Secret Police
By Glenn Harlan Reynolds
In the course of its secretive “John Doe” investigation, the GAB hoovered up millions of personal emails from Republican donors and supporters, and even raided people’s homes, while forbidding them to talk about it…
Now an investigation by Wisconsin Attorney General Brad Schimel on behalf of the overseeing court has spelled out a long list of misdeeds by the investigators…
As the report says, “After reviewing the emails exchanged between the attorneys at GAB, it is apparent that GAB attorneys had prejudged the guilt of Governor Walker, Wisconsin Republicans, and related organizations that they were investigating and this dramatically influenced their ability to give competent legal advice. GAB attorneys did not act in a detached and professional manner. The most reasonable inference is that they were on a mission to bring down the Walker campaign and the Governor himself.”
The investigation continued despite its failure to find anything like the sort of violations it was ostensibly intended to investigate. It continued despite court orders to stop. And prosecutors retained evidence (including medical and other records about Republican officials and donors, kept in a file labeled “opposition research”) even after being ordered by the Wisconsin Supreme Court to turn all the information over.
Influence
Wall Street Journal: Millions of People Post Comments on Federal Regulations. Many Are Fake.
By James V. Grimaldi and Paul Overberg
Reports earlier this year of fraudulent comments on the FCC docket prompted the Journal to investigate the phenomenon there and at other federal agencies. After sending surveys to nearly 1 million people-predominantly from the FCC docket-the Journal found a much wider problem than previously reported, including nearly 7,800 people who told the Journal comments posted on federal dockets in their names were fakes.
The Journal found instances of fakes that favored antiregulation stances but also comments mirroring consumer-groups’ pro-regulation talking points, posted without permission of people whose names were on them.
Such distortions, often unknown even to the agencies involved, cut against an important element of democracy, the public’s ability to participate in federal rule-making. The public-comment process, mandated by law, can influence outcomes of regulations affecting millions.
Political Advertising
Fitchburg Sentinel & Enterprise: Have a heart. Don’t be a Grinch about money in politics
By Dan Backer
T’is the season of giving and Americans sure know how. The average American plans to spend $660 on Christmas gifts this year. An estimated $1 trillion will be spent by January 1st – for the first time in the history of U.S. business.
And it’s not just direct spending. Retailers will spend billions in advertising dollars to get us in the store or shopping online.
But if Christmas toy commercials and snow-filled movie trailers were replaced with political ads, then gleeful carolers would be replaced by shrill outrage. Anti-speech liberals would lament the rise of “money in politics,” turning to the government for a solution to the “problem” of Americans exercising their rights to share their ideas and seek support to spread them far and wide.
Election 2016’s final price tag – the largest in U.S. history – fell just short of $7 billion for all federal elections. Americans will spend about 150 times more on Christmas cards and stuffed teddy bears than we spent on politics during what many describe as the most consequential election of the 21st century…
The next time you see a holiday commercial, watch it or ignore the noise. The next time you see a 2018 political ad, vote for the candidate or not. That’s always been your choice.
Donors
USA Today: Major Democratic donors launch a center to help donors get smart about political spending
By Fredreka Schouten
Two major Democratic donors, the husband-and-wife team of Steve Phillips and Susan Sandler, this week will unveil a new data and political analysis clearinghouse to help other wealthy Democrats figure out how to get the most bang for the millions of dollars they will plow into next year’s midterm elections.
The Sandler Phillips Center is akin to a “financial advisory” firm for politics, Phillips said, that will dig into voting patterns and demographic data and vet on-the-ground activists to help guide investments of liberal political money to federal and state races where it can make a difference…
The new center – and its recommendations for the 2018 elections – will be unveiled Thursday to donors in the Democracy Alliance, an influential coalition of the Democratic Party’s biggest givers.
Candidates and Campaigns
Vice: Being Rich Is the Easiest Way to Get Elected
By Paul Blest
Funding is often necessary to win office, but it’s not always sufficient. Failed candidate Meg Whitman put up over $140 million of her own money in the California gubernatorial race in 2010 and lost by double digits, while current administrator of the Small Business Administration Linda McMahon spent $97 million in two straight failed bids for US Senate in Connecticut.
Out of the 528 Congressional candidates who accounted for over 50 percent of their own contributions between 2010 and April 2016, just 11 had won, according a report by the Center for Responsive Politics…
“When you have people self-financing these campaigns, then they don’t have a funding accountability to anyone,” added Daniel Newman, president of MapLight, a group that tracks money in politics. “Some people find that appealing, that they’re not accountable to special interests, but at the same time they’re not accountable to citizens or constituents, because they didn’t come from an organized political base.”
The States
Denver Post: Taxpayer groups file suit against Denver to prevent disclosure of nonprofits’ donors in election spending
By Jon Murray
The lawsuit, filed by the Phoenix-based Goldwater Institute on behalf of the two groups, says changes approved by the City Council in September violate the free speech provision of the First Amendment. The city ordinance requires clubs, associations, corporations and groups that advocate for or against local ballot measures to meet the disclosure requirements of issue committees once they raise and spend at least $500.
Once it passes that threshold, an issue committee must identify by name and address each donor who gave $50 or more within that calendar year…
The lawsuit was filed in Denver District Court…
The Goldwater Institute, which has challenged similar laws in other states, argues that two more recent rulings by the 10th U.S. Circuit Court of Appeals in Denver have changed the legal landscape.
In the more recent of the two, the court ruled in early 2016 that the burdens imposed by the law on the nonprofit Coalition for Secular Government, which expected to spend $3,500 challenging a proposed “personhood” amendment, were greater than the “government’s modest informational interest” in requiring donor disclosure.
Santa Fe New Mexican: Measure to change campaign finance reporting withdrawn
By Tripp Stelnicki
A controversial proposal that would have altered the city’s campaign code, removing a disclosure requirement for people and groups spending money on advertisements for ballot initiatives in municipal elections, is no more.
Councilor Carmichael Dominguez, the sponsor, said Wednesday he was withdrawing the proposal.
“I don’t want us to be doing anything where we look like we’re anti-disclosure at all,” Dominguez said.
According to city code, any person or group spending more than $250 on a form of public communication in favor of or against a ballot measure must file regular campaign finance statements with the city clerk.
The Rio Grande Foundation, an Albuquerque-based, libertarian-leaning think tank, filed a lawsuit against the city in federal court this summer over the disclosure requirement, arguing it infringes on constitutionally protected speech and violates nonprofit donors’ privacy. Dominguez had said his proposal was tailored to limit the city’s exposure to what he said could be a costly legal battle…
U.S. District Court Magistrate Judge Carmen Garza has scheduled a conference Dec. 19 to determine the date of a trial in the foundation’s case against the city.
WAMU D.C. Public Radio: Public Financing Of Political Campaigns Moves Forward In D.C. Council
By Martin Austermuhle
A D.C. Council committee on Wednesday gave unanimous approval to a bill creating a program to provide qualified candidates with taxpayer funds to run their campaigns. These candidates would have to swear off any contributions from large donors, corporations and political action committees.
Under the bill written by Council Members David Grosso (I-At Large) and Charles Allen (D-Ward 6), candidates for office in D.C. would first have to qualify for public financing by raising a certain amount of money from small-dollar donors. This could be from as high as $40,000 from 1,000 donors for mayoral candidates to $5,000 from 150 donors for ward-based Council candidates.
They would then receive a lump-sum base payment to kickstart their campaigns – $160,000 for mayoral contenders, $40,000 for Council candidates – and be eligible for public funds at a 5 to 1 match.
Prescott Daily Courier: Senator hopes to limit marijuana billboards
By Howard Fischer, Capitol Media Services
Farnsworth conceded Arizona could not ban billboards which urge people to vote specifically for a ballot proposition that would legalize marijuana for all purposes.
“Free speech and promoting what you believe in is an important part of our society,” he said. And Farnsworth said he will make sure that the final version of SB 1032 is worded in a way so as not to stifle legitimate political speech.
But Barr said the message does not even need to specifically urge people to vote yes for a specific numbered ballot measure to gain constitutional protection. He said even signs talking about how legalization affects crime or the number of people incarcerated are entitled to the same First Amendment protections.
“Those are all public policy issues,” Barr said. And he’s not sure that Farnsworth’s proposal can be crafted in a way to pass constitutional muster.
“As we know, the Arizona Legislature’s not famed for its narrowly drafted legislation,” he quipped.
