CCP
Did hundreds of thousands of “investors” really write “personally” to the SEC on corporate disclosure? No, not really.
By Brad Smith
As followers of this blog will know, for the last four years Democrats and others on the political left have been trying to get new mandatory disclosure requirements on spending related to politics. When this effort failed in Congress with the defeat of the so-called DISCLOSE Act, the effort went to the Federal Election Commission. But the FEC is a bipartisan board, designed that way specifically so that one party cannot force rules on the other for partisan gain. There, the disclosure effort failed.
Since then the left has been trying to get some agency – any agency – to require more disclosure. They’ve used the IRS, resulting in the IRS targeting scandal; they tried to Federal Communications Commission, resulting in a mini-scandal of ill-advised regulation and purloined bank accounts; and for the past two years, they’ve been trying to get the Securities and Exchange Commission to demand more mandatory disclosure of corporate spending. Late last month, however, the SEC indicated that it will not take up the regulation of corporate political speech.
The reason, we believe, was revealed by Senator Chuck Schumer (D. N.Y.) when he first introduced the DISCLOSE Act – it was for the “deterrent effect” of compulsory disclosure on speech. We’ve written at length about the problems of both excessive disclosure and “junk disclosure,” and we won’t repeat that here. Suffice it to say that while we think excessive disclosure of the type now demanded is a bad idea (” “), and while we note that the left demands not only disclosure of political spending, but of all types of associational relationships, such as membership in trade associations, funding of charities, think tanks, and other non-profits, we do admit that one can conjure up plausible reasons for more compulsory disclosure.
Professor Coates’ bad government proposal for the SEC
By Brad Smith
As an administrative law professor and former head of a federal regulatory agency (the FEC), I’m not naive enough to think that independent regulatory agencies are free of politics. But in those same capacities, I’m little short of appalled to hear someone argue that an agency should pursue a regulatory initiative not on its own merit, but because it will make it more difficult for the public to oppose other regulatory initiatives of the agency. The very idea of independent agencies is that they bring to problems expertise that is beyond that of Congress, and will apply that expertise in a non-partisan fashion that traditional executive branch agencies cannot. To suggest that an agency continue forward with a rule, using up both their own staff time and the time, treasure, and energy of the public, simply to gain the upper hand over the public in passing other, unrelated rules, is bad government, plain and simple.
In another recent post, I commented on the growing tendency of traditional “good government” types to promote “bad government” practices and procedures if they thought it would help them obtain their ends. Of course, those of us in academia who would venture into active public policy debates must participate in the real politick that is going on around us. But it does strike me that we ought to take a bit higher position in support of sound policy making and non-partisan approaches than full time politicos and activists. At a minimum, we ought not let our immediate political goals lead us to support long-term approaches to politics that are contrary to sound policy-making and a government that works for the people, rather than one that sees itself at war with the public.The least we can do as scholars is avoid promoting a bad approach to policy. Years ago, government reformers who sought better policy making frameworks were derided as “goo-goos,” short for “good government.” As we see reformers more and more willing to adopt an anything goes approach to gaining their substantive policy objectives, it is now fair to deride them as supporters of “bad, bad” government, or “baa-baas.” We hope scholars of Professor Coates’ quality don’t slide off in that direction.
Independent Groups
Wall Street Journal: Texas Billionaire, Corporate Raider Funded GOP Campaigns
By Tamara Audi
Harold Simmons started life without electricity or indoor plumbing in rural Texas and went on to become a corporate raider and one of the richest and most politically influential men in the country.
Mr. Simmons, who died Saturday at age 82, was major donor to the Republican Party, whose money fueled the 2012 presidential campaign and the GOP bid to reclaim Congress.
The Texas billionaire was a controversial figure and often did battle with federal regulators as head of Contran Corp., a holding company for other companies that dealt in hazardous waste and toxic chemicals. He was also a major philanthropist, giving millions to Texas universities, the Dallas Opera and to a girls’ school in Africa founded by Oprah Winfrey.
National Review Online: The IRS and the Tea Party
By James V. DeLong
These public-advocacy and electoral-influence functions are inextricably linked, and the IRS could have decided that this, in itself, legitimated tea-party political activities; IRS rulings and Supreme Court cases could serve as precedent.
But tea-party political activity is offensive to the IRS — so the current notice classifies any references to candidates, even in voter guides or open forums, as political. Then, to nail the door shut, the proposal contemplates eliminating the “primary purpose” test and forbidding social-welfare organizations from engaging in any political activity. (Repeat: This proposal does not apply to unions, business associations, or other organizations exempt under other subsections.)
Obviously, this proposal has nothing to do with protecting tax revenues. The idea that a tea-party group, run on a shoestring and the energy of volunteers, threatens the collection of the nation’s taxes is a joke.
Wall Street Journal: The Rope to Hang Them: John Podesta’s corporate donors are hoping to buy political protection.
Editorial
The Center for American Progress claims that these corporate donations made up “less than six percent” of its $42 million annual budget and “less than three percent” for its political action fund. Its 58 corporate donors each contributed at least $10,000, though the thank tank didn’t break out specific amounts. The donor list would also have been more instructive if it had included its many wealthy individual donors and foundation and union grants. But apparently that degree of transparency is reserved for libertarians like the Koch brothers.
Fortune 500 CEOs are pragmatists who will do what it takes so their companies can co-exist with big government. Depending on big business to defend freedom and free markets is a fool’s errand. That cause will have to be carried by individual Americans and this newspaper.
Meanwhile, keep Mr. Podesta’s donor list in mind the next time a liberal talks about corporations opposing government power. Lenin was closer to the truth when he said business leaders would sell government the rope to hang them.
NY Times: Upstart Groups Challenge Rove for G.O.P. Cash
By NICHOLAS CONFESSORE
At least a dozen “super PACs” are setting up to back individual Republican candidates for the United States Senate, challenging the strategic and financial dominance that Karl Rove and the group he co-founded, American Crossroads, have enjoyed ever since the Supreme Court’s Citizens United decision in 2010 cleared the way for unlimited independent spending.
In wooing donors, the new groups — in states like Texas, Iowa, West Virginia and Louisiana — are exploiting Crossroads’ poor showing in 2012, when $300 million spent by the super PAC and a sister nonprofit group yielded few victories. Some are suggesting that Crossroads’ deep ties to the Republican establishment and recent clashes with conservative activists are a potential liability for Republican incumbents facing Tea Party challengers.
SCOTUS/Judiciary
Wyoming Liberty Group: WyLiberty Attorneys File Petition with the United States Supreme Court
By Steve Klein and Benjamin Barr
CHEYENNE – Wyoming Liberty Group attorneys filed a petition with the United States Supreme Court today, requesting the Court hear an appeal of the case Free Speech v. Federal Election Commission (FEC). Free Speech, a small grassroots group of three Wyomingites, sued the FEC in 2012 for maintaining vague and overbroad regulations that prevent political engagement. The case was dismissed by the Wyoming Federal District Court and the Tenth Circuit Court of Appeals affirmed its ruling.
“If Free Speech had spoken out during the 2012 election cycle—be it through newspaper ads, radio ads, or even Facebook ads—it might have violated FEC regulations.” said WyLiberty staff attorney Steve Klein. “Not even the FEC knows where free speech ends and where campaign finance law begins. This is just as injurious to the First Amendment as outright censorship.”
Tax Financing
New York Post: The governor’s ‘fix’ is in
By Bill Maurer
Thus, actual corruption will remain the commission’s secondary concern; its foremost agenda item will be the “problems” in New York’s campaign-finance system. This, despite the fact that of the 19 scandals that gave rise to the commission, only one concerned campaign contributions.
The commission is now pushing tired “solutions” urged by pro-regulation forces across the country: lowering the amount of money one may contribute to a candidate; increasing public dissemination of the names and addresses of those who dare participate in politics; creating another agency filled with unelected bureaucrats to prosecute peaceful political activity; and pre-emptively showering politicians with taxpayer funds supposedly to make them resistant to bribes.
Of course, those in power could stop corruption by not being corrupt. This is apparently too much to expect, however. Instead, the people must pay by sacrificing their free-speech rights and their money.
Candidates, Politicians, Campaigns, and Parties
Roll Call: Retiring Members of Congress Hold Over $13 Million in Campaign Accounts
By Kent Cooper
The seventeen Members of Congress who have announced their retirement from Congress have campaign accounts that hold over $13 million in campaign funds. Some of these funds may be donated to charities during this holiday season, some may not.
Lobbying and Ethics
Wall Street Journal: Lines Blur When Lobbyists Invest in Industries They Represent
By BRODY MULLINS, JAMES V. GRIMALDI and REBECCA BALLHAUS
Lobbyists are consummate Washington insiders. By dint of continual contact with public officials, they often glean intimate knowledge of pending policy changes and political activities that affect the fortunes of companies or industries they represent.
Many also hold investments that overlap with their responsibilities, according to a Journal review of public records. It showed that about one in five lobbyists whose holdings could be identified had invested in their clients or companies in the industries they are concerned with.
The Journal review found no suggestion of insider trading—investing on significant nonpublic information entrusted in confidence—by the lobbyists, who operate in a political milieu where information that might be held tight in a corporate environment can be served up freely by members of Congress.
State and Local
Arkansas –– NY Times: Arkansas Lieutenant Governor Faces Calls to Quit Over Ethics Violations
By ALAN BLINDER
Lt. Gov. Mark Darr of Arkansas, who said this week that he would settle with his state’s Ethics Commission amid findings that he repeatedly broke campaign finance laws, on Tuesday defied mounting calls for his resignation, including one from Gov. Mike Beebe, and said he intended to remain in office.
Maryland –– Washington Post: Maryland’s tilted campaign playing field
Editorial
MARYLAND’S SWISS CHEESE campaign finance rules are looking more cavity-riddled than ever. The Board of Elections decreed recently that Lt. Gov. Anthony G. Brown, as a state official, is barred from raising money for his gubernatorial campaign for three months starting Jan. 8, while the General Assembly is in session. However, the board ruled that no such prohibition applies to Mr. Brown’s running mate, Howard County Executive Ken Ulman, who may continue to rake in cash from lobbyists and special interests to his heart’s content.
Somehow discounting the fact that Mr. Ulman and Mr. Brown, both Democrats, are politically joined at the hip since they are running for statewide office on a joint ticket, the board decided that Mr. Ulman is a mere local official, and therefore shielded from the law designed to avoid the appearance (and reality) of conflicts of interest on the part of state officials while the legislature is at work.
Michigan –– Michigan Live: Gov. Snyder signs law to double Michigan campaign contribution limits, codify ‘issue ad’ rules
By Jonathan Oosting
The law also codifies non-disclosure rules for so-called “issue ads,” which often feature attacks but do not direct viewers to “vote for” or “vote against” a particular candidate.
For the first time, groups that run issue ads or place robocalls in Michigan will be required to include an “authorized by” disclaimer — but they will not have to name their donors.
Montana –– Ballot Access: Montana Initiative, Directing Montana Legislators to Work for a Constitutional Amendment to Overturn Citizens United, Struck Down
By Richard Winger
On December 20, a Montana lower state court struck down an initiative passed in 2012 that orders Montana legislators to work for a constitutional amendment to overturn Citizens United v Federal Election Commission. The recent Montana case is Rickert v McCulloch, Lewis and Clark County, cdv-2012-1003.
New York –– AP: New job for NYC commissioner of investigation
NEW YORK — New York City Commissioner of Investigation Rose Gill Hearn will be the next head of the Campaign Finance Board.
Mayor Michael Bloomberg announced Monday that Gill Hearn will chair the board that monitors political fundraising in the city.
Gill Hearn succeeds the Rev. Joseph P. Parkes. He resigned last week following the expiration of his term as chairman of the Campaign Finance Board.
