In the News
The Hill: Democrats wrong with plan to fund campaigns at expense of taxpayers
By David Keating
The top priority for House Democrats this new year is a bill to fund their campaigns at the expense of taxpayers. But the proposal would not just make it easier for politicians to get their hands on your money. It would also limit campaign speech. Campaign programs financed by taxpayers suffer from a number of problems, including corruption, bureaucracy, and forcing Americans to financially support candidates that they oppose. Perhaps the least sensible part of these campaign programs, however, is the spending limit that they would impose on participating candidates.
If the idea behind this proposal for campaigns financed by taxpayers is to make it easier for candidates to raise money and speak about elections, why would the government demand, as a condition of the program, that candidates must agree to limit their overall spending? Spending caps undercut claims by advocates that the campaign programs are intended to bolster speech rather than restrict it. They instead make the programs look like bribes to politicians who agree to speak less about elections…
This proposal to allow campaigns to be financed by taxpayers has many faults, but spending limits represent an unforced error. Subsidizing speech does not require limiting speech. The programs could simply stipulate that candidates will no longer receive tax dollars once their campaign hits the subsidy cap. Instead, such programs create ceilings. Spending caps give away the true motivation behind campaigns financed by taxpayers, which is greater government control over political speech.
Congress
Wall Street Journal: Democrats Set to Push Election Overhaul, Without GOP Support
By Joshua Jamerson and Julie Bykowicz
On the campaign-finance front, the legislation would require several classes of politically active organizations, including tax-exempt 501(c)(4) charitable groups, to disclose donors who have given $10,000 or more during an election cycle. Currently, those groups don’t have to disclose their donors. The bill also allocates a pool of taxpayer money to match certain small-dollar donations 6-to-1; aides didn’t disclose how much money would be set aside for that initiative, which is meant to encourage grass-roots campaigning.
“The most important thing we can do is come out strong with passage in the House,” said Rep. John Sarbanes (D., Md.), who was one of the chief architects of the legislation, known as House Resolution 1, or H.R. 1…
“I haven’t been a supporter of taxpayer funding to run political campaigns. I don’t think that’s a good idea,” Rep. Steve Scalise of Louisiana, the No. 2 House Republican, said Wednesday, when asked about the Democratic plan to be unveiled Friday…
Still, some Republicans have also called for greater transparency in campaign-finance law-and to scale back the influence of such outside groups as super PACs, political-action committees that can raise and spend unlimited sums of cash.
Rep. Mark Meadows (R., N.C.) and Sen. Ted Cruz (R., Texas) introduced a bill in December that they said aimed to balance concerns about big money in politics with a desire to protect free speech. Their bill removes caps on direct contributions to candidates from individuals and requires donations of more than $200 to be disclosed within 24 hours. Similar bills were earlier introduced in 2014 and 2016, but stalled.
The Federalist: First On Nancy Pelosi’s Agenda: Attacking Free Expression
By David Harsanyi
One of the new bills – specifics are still cloudy – reportedly allocates a pool of taxpayer money to match small-dollar donations 6-to-1, as a way of encouraging “grass-roots campaigning,” according to The Wall Street Journal.
The package, fortunately, won’t pass the Senate. But government-financed campaigns – empowering the state to allocate money to preferred donors and dissuading non-preferred donors – has been something of a hobbyhorse in progressive circles. Setting aside the many constitutional concerns, the recent abuses by the Internal Revenue Service when tasked with regulating political speech demonstrate just how easy it is for bureaucrats to manipulate rules meant to govern speech. These are rules that shouldn’t exist, period…
Democrats will also include a provision in their package that would make tax-exempt 501(c)(4) charitable groups disclose donors who’ve given $10,000 or more during an election cycle. As I’ve written elsewhere, this obsession with eliminating anonymity is also a transparent attempt to chill speech and undermine minority opinions.
(As an aside, the media’s incessant use of the euphemism “good-government groups” in describing “special interest groups” that campaign to limit “dark money” is itself a political bias. There’s no evidence that “good government” is contingent on handing over donor information to activists or that asking the IRS permission to petition the state engenders better governance. These groups do for “good government” what the Patriot Act did for patriotism and the Affordable Care Act did for affordability.)
USA Today: Nancy Pelosi and Jim McGovern: House Democrats will restore transparency, ethics, unity
By Nancy Pelosi and Jim McGovern
The Democratic majority means a fresh beginning after the most closed Congress in our nation’s history – a Republican Congress that shut out the voices of the American people to push backroom, speed-of-light, dark-of-night tax scams for the special interests, while enabling the worst of the Trump administration’s rampant culture of corruption, cronyism and incompetence.
That is why we are proud to unveil a rules package that will usher in a new era of clean government that will honor the consensus of the American people – restoring the people’s house to the people. Transparency, ethics and unity will be the guiding light of the Democratic Congress…
Our rules package will enable us to make progress from the start by passing a priority of our transformative Freshman Class: HR 1 – reducing the role of money and amplifying the people’s voice in our politics. HR 1 will allow us to clean up Congress to give confidence to the American people that we can and will deliver results for the people: lowering health costs and the price of prescription drugs; increasing paychecks while rebuilding America with green, modern infrastructure; protecting workers’ pensions; and cleaning up corruption to make Washington work for everyone.
American Prospect: Democrats Have Promised to Clean Up Washington. Can They Deliver?
By Eliza Newlin Carney
Inevitably, the House’s pending vote on the reform package known as H.R. 1 will be at least in part symbolic, given the likelihood that Senate Majority Leader Mitch McConnell will refuse to bring it up for a vote. McConnell’s foreseeable opposition will put the GOP on record as the Party of No-no small-donor matching funds, no disclosure, no fixes to voting rights, ethics or gerrymandering…
But Democrats could face their own political backlash if they cast themselves as change agents without actually following through. Democrats say the ethics, campaign-finance, and gerrymandering reforms at the heart of H.R. 1 will clean up Washington and revive voters’ faith in democracy. (Legislation to restore voter protections to the Voting Rights Act will proceed on a separate track.) Yet the clash between Democrats’ ideals and their actual political practices could threaten to drown out their reform message, especially as the 2020 presidential campaign swings into high gear.
It’s bad enough that a Russia-style disinformation campaign helped elect Senate Democrat Doug Jones in Alabama, that New Jersey Democrats are pursuing GOP-style partisan gerrymandering, and that Democrat-friendly super PACs have been exploiting disclosure loopholes to hide their donors. It will be even harder for Democrats to take the high road once big donors on the left start leveraging secretive nonprofits-many of which already power the anti-Trump resistance-and super PACs to support the party’s sprawling field of presidential hopefuls.
Politico: Congress unlikely to stop super PACs from hiding donors
By Maggie Severns
Sixty-nine super PACs, which can raise unlimited sums of money but are supposed to tell the public who donated it, delayed or avoided making those disclosures during the 2018 midterms.
One group, Texas Forever, spent $2.3 million attacking Sen. Ted Cruz (R-Texas) and didn’t reveal until after the election that it was funded by Washington Democrats…
Lawmakers could crack down on such practices by requiring super PACs to disclose major donors during the two-week period before an election, as campaigns must do. They could also create a new disclosure deadline shortly before Election Day. Current rules place the final pre-election deadline two weeks before voters go to the polls.
But at the moment, there is little discussion of changing super PAC disclosure rules in House Democrats’ bill, according to multiple people providing input on it…
The bill House Democrats are crafting would make changes to campaign-finance law, including by curbing coordination between super PACs or possibly barring the groups from supporting a single candidate, advocates in touch with the bill’s authors said.
Rep. John Sarbanes (D-Md.), the lawmaker chiefly driving the effort, said he anticipates H.R. 1 addressing the super PAC issue through changes to the FEC that “would make it better-equipped to deal with pop-up super PACs and other players that are coming onto the scene every day.”
Axios: 1 big thing: First House bill to tackle election security
By Joe Uchill
H.R. 1, the gargantuan first bill the new House Democratic majority will unveil Friday, is an anti-corruption grab bag that most prominently tackles campaign finance, sexual harassment and voting rights. But election cybersecurity will quietly play a major role in the bill, too…
But H.R. 1 is more than just a flag in the sand. Everyone who blocks the Democrats’ crackdowns on government misconduct will have to explain why they are opposed to:
– Forcing super PACs to report donors.
– Barring Congress from using taxpayer funds to pay sexual harassment settlements.
– Reinstating the Voting Rights Act.
– Other largely bipartisan-supported provisions many voters see as good government…
H.R. 1 also contains the Honest Ads Act, a Senate bill that would require political ads online to disclose who paid for them. That kind of regulation already exists for other kinds of media.
While Russia famously purchased Facebook ads in rubles during the 2016 election, most of its disinformation work was conducted through puppet social media accounts.
Free Speech
National Review: Boycotts Are Not the Free Market
By Dan McLaughlin
Political boycotts – especially secondary boycotts – are not the free market.
Some of this misunderstanding arises from the political battle lines over free markets. In modern America, fights over free markets – markets for goods and services, markets for labor, markets for capital and investment – are typically framed between conservatives arguing for less government involvement in the market, and liberals/progressives arguing for greater government intervention. As a result, we tend to think of “free markets” as shorthand for any action of private individuals rather than the government.
But that’s not a real definition of free markets, any more than “no government censorship” is a complete definition of free speech. Free markets require a legal architecture, a basis in the culture, and the development of key private institutions in order to function…
Just because secondary boycotts usually (though not always, as I discuss below) involve private actors does not make them an exercise in free markets. Consider the definition I offered above: markets are about freely choosing to do business with others for mutual benefit. But if you are using your own influence in the market to prevent a business from engaging in free exchanges with someone else you disagree with, that ultimately is a reduction of market freedom, not an exercise of it. You are preventing someone else from being able to freely do the same business that you do.
Privacy
Wiley Rein Election Law News: The First Amendment Right to Political Privacy Chapter 3 – Red Monday, Paul Sweezy, and the Frankfurter Concurrence
By Lee E. Goodman
Chapter 1 recounted the plight of the “Hollywood Ten” communists, who went to prison and lost their careers rather than disclose the names of fellow communists to the House Committee on Un-American Activities (HUAC) in 1947. Their fate was decided by the U.S. Court of Appeals for the District of Columbia, and the Supreme Court was unwilling to wade into the Red Scare. Chapter 2 covered the First Amendment protection the U.S. Court of Appeals for the District of Columbia and the Supreme Court afforded, a few years later, to the conservative Committee on Constitutional Government and its political efforts to thwart the New Deal. This Chapter 3 recounts how the Supreme Court slowly began to intervene in the Red Scare, culminating with a significant concurring opinion by Justice Felix Frankfurter in the case of Marxist political activist Paul Sweezy one decade after the Hollywood Ten appeared before the HUAC.
Contribution Limits
Washington Examiner: Campaign finance restrictions help billionaires like Bloomberg
By Washington Examiner
Democrats nominated a millionaire for president in 2016, but she lost to a billionaire. If the party now wants to trade up to a billionaire, Michael Bloomberg might be its guy. He’ll start with a big – let’s not call it healthy – war chest, for he is promising to spend $100 million of his own money on the way to the White House.
But anyone who fears that the party of the Left might be sullied by dependence on, or dominance by, such a mega-rich candidate should reconsider their support for campaign finance regulations…
Perhaps Sen. Bernie Sanders, I-Vt., would propose curbing Bloomberg’s ability to spend on his own campaign, but the Supreme Court wouldn’t and shouldn’t tolerate a law restricting how much of your own money you may spend to ask people to vote for you.
Here’s a better proposal for any progressive out there who doesn’t want billionaire candidates to start with a huge advantage. Our idea could instantly abolish the position of lobbyist bundler, and it might make dark money and super PACs a thing of the past.
Here it is: Abolish the limit on individual contributions. If Bloomberg can get a million-dollar check from himself, Harris should be able to get a million-dollar check from Steyer, and Biden should be able to call up his former boss, former President Barack Obama, for a million.
This would be cleaner and simpler than the system we have, and that’s what the progressive Left says it wants. Or Democrats could leave the regulations as they are – if they like Mike.
Candidates and Campaigns
The Hill: Why forming an exploratory committee means you’re already running for president
By Reid Wilson
In modern politics, there is no such thing as an exploratory committee. The paperwork Warren filed with the Federal Election Commission shows she has created an actual campaign committee.
“Tis the season for these bizarre FEC distinctions on campaign committees,” said Michael Toner, a former chairman of the Federal Election Commission under President George W. Bush. “You can call a committee an exploratory committee, but legally it is a campaign committee.”
Warren’s filings with the FEC include a formal statement of candidacy, in which she declares herself a candidate for president.
“Though this is an exploratory committee, for the sake of transparency and full compliance with the law, Senator Warren and her principal campaign committee will abide by all requirements for principal campaign committees and candidates under the Federal Election Campaign Act of 1971, as amended,” Warren’s campaign wrote on her Statement of Candidacy.
Legally speaking, her principle campaign committee, the Elizabeth Warren Presidential Exploratory Committee Inc., is an actual campaign committee that will allow her to raise and spend money under federal election rules, and that will require her to disclose that fundraising to the FEC.
By Brian Schwartz
Sen. Elizabeth Warren is following her own advice to fellow Democrats about rejecting money from political action committees to help fund their campaigns in the 2020 presidential election.
Warren, a liberal from Massachusetts, is closing her joint fundraising committee, the Elizabeth Warren Action Fund, as she explores a run for the White House, according to her chief spokeswoman, Kristen Orthman.
“We are in process of winding down Action Fund,” Orthman said in an email.
The commitment to shut down the fund comes after Warren told MSNBC’s Rachel Maddow on Wednesday that she believes candidates running for the party’s nomination should avoid funding their campaigns through PACs.
She also said billionaires running for president should not self-fund their campaigns.
“I just mean that people should not be self-funding and they should not be funded from PACs from other billionaires,” Warren said…
Her call for billionaires not to self-fund campaign operations follows CNBC’s reporting that Democratic donor and former New York City Mayor Mike Bloomberg was prepared to spend more than $100 million on his own campaign organization if he were to run in 2020. Tom Steyer, a liberal billionaire from California, is also considering a run for president and will travel to the caucus and primary states of Iowa, New Hampshire and Nevada early this year.
IRS
Washington Free Beacon: There’s No Such Thing as a Free Speech
By Joseph Bottum
Philip Hamburger has always gone his own way, and in [Liberal Suppression: Section 501(c)(3) and the Taxation of Speech] he intends what his subtitle asserts: The constitutional idea of free speech has weakened over the past century, and one of the most powerful devices diminishing freedom of speech is the treatment of nonprofit organizations in the tax code.
“Many billions of dollars” are contributed annually to nonprofits, Hamburger points out. And Section 501(c)(3) prohibits those nonprofits from lobbying directly for legislation or urging the public to vote for or against any particular candidate or ballot measure. Meanwhile, Section 170(c) gives the organizations that qualify under 501(c)(3) a competitive advantage by designating as tax-deductible the donations made to them.
This is, Hamburger declares, “an extraordinary abridgement” of what early generations of Americans would have understood as freedom of speech, which was centered around freedom of political speech…
With the tax structure now so strongly in place, even the threat of removing tax exemptions causes nonprofits to shy away from the kind of public speech that would help maintain them as the Tocquevillian mediating institutions they should be.
Moreover, in Hamburger’s view, the Constitution guarantees these mediating institutions the robust freedom of speech that the tax code takes away from them. That’s a tough row to hoe, given that the Supreme Court has unanimously upheld Section 501(c)(3). But Liberal Suppression is willing to do the work, demanding that we see the constitutional infirmity in this particular example of the power and impact of the administrative state.
The States
Minneapolis Star Tribune: Minnesota campaign board proposal targets ‘issue ads’ funded by anonymous donors
By Torey Van Oot
Minnesota’s campaign finance board wants legislators to require political groups to name the donors who pay for issue advertisements that stop short of urging support or opposition of a specific candidate during a campaign.
Outside groups that bankroll traditional campaign ads flooding airwaves and mailboxes each election must disclose their spending and funding sources. But other “issue ads,” which talk about a state candidate or issue without using words considered to express advocacy, like vote for, elect, support, defeat or reject, are not subject to the same requirements…
On Thursday, the Campaign Finance and Public Disclosure Board will weigh whether to ask legislators to update the law to trigger donor disclosure for ads that “easily convey support for or opposition to a candidate,” even if they do not explicitly urge a vote in one direction.
Campaign Finance Board Executive Director Jeff Sigurdson said staff began working on the proposal after seeing ads that didn’t meet the current disclosure standards but “certainly would have the intent of trying to influence the election.”…
Charlie Weaver, executive director of the Minnesota Business Partnership, said the change could make compliance more difficult and put the board in the position of having to make subjective decisions about thousands of potential ads or mailings…
Weaver also worries such changes could have a chilling effect on speech for ordinary citizens and smaller groups looking to speak out about policy as an election nears.
New York Post: Here’s how much NYC’s public advocate election will cost taxpayers
By Rich Calder
Mayor Bill de Blasio signed a bill Wednesday that allows potential candidates for the office – nearly two dozen at last count – to apply for public matching funds under the current system or a more generous one set for 2021.
At present, the city Campaign Finance Board provides a 6-to-1 match for donations up to $175 from city residents to candidates who collect at least $62,500 from 500 supporters.
But the new program kicks in an 8-to-1 match for each contribution up to $250 as long as candidates agree to take no more than $1,000 from an individual contributor, instead of $2,550.
De Blasio said the lower contribution limit would bolster the political power of “average New Yorkers.”
“With the upcoming special election, we’re expediting an important piece of legislation that will strengthen the voices of average New Yorkers by reforming campaign finance laws,” he said.
But the new system will also likely boost the cost of the race for an office with a budget of $3.5 million.
The Board of Elections says it’ll cost about $15 million just to conduct the special election, set for Feb. 26.
The total bill for the matching funds will depend on how many candidates qualify.
But in 2013, the Campaign Finance Board shelled out $5 million in matching funds to three candidates who met the minimum fundraising threshold.
Associated Press: Lawmaker review of Greitens over, MEC complaint remains
By Summer Ballentine
While work by Missouri House lawmakers to investigate Eric Greitens officially came to an end Monday when the investigatory committee issued its final report, its leader said he’s still hopeful the former scandal-ridden governor will be held accountable for alleged campaign finance violations.
Republican Rep. Jay Barnes said in a statement that the committee he headed lost the authority to continue its investigation into numerous claims of personal and political misconduct levied against Greitens when the Republican resigned in the face of possible impeachment in June.
“However, the Missouri Ethics Commission has the power to investigate and act,” Barnes said. “I remain hopeful the commission will take appropriate action to enforce Missouri’s campaign finance laws against Eric Greitens and those with whom he conspired to evade reporting requirements and voter-enacted campaign finance limits.”
Barnes in July filed an ethics complaint against Greitens’ gubernatorial campaign and a nonprofit that promoted his agenda.
Among the allegations, the complaint said several of Greitens’ campaign staff members established the nonprofit called A New Missouri specifically to skirt new donation limits while essentially functioning as an unofficial arm of Greitens’ operation.
The nonprofit has faced criticism because it’s able to accept unlimited campaign donations without disclosing its donors.
