In the News
Cato Institute: Putting the IRS in Charge of Speech
The IRS is a political agency. It’s been used against political opponents going back to at least the 1960s. New proposed rules governing nonprofits that lobby Congress could muzzle those groups when they want to talk to their own members. David Keating is President of the Center for Competitive Politics.
CCP
Unintended Consequences: Iowa Edition
By Luke Wachob
When governments pass laws intended to curb the influence of wealth in politics, they often end up with regulatory regimes that are either so strict or so complex that legal counsel is necessary to navigate them. The unintended consequence of these laws is that they actually elevate the influence of the wealthy, who can afford to hire whatever lawyers and accountants are needed to comply with regulations, while stamping out a great deal of grassroots speech from ordinary citizens who cannot afford those resources.
As much as we point out this reality of unintended consequences, it’s always nice to hear actual regulators acknowledging the phenomenon. Enter Megan Tooker, Executive Director of the Iowa Ethics & Campaign Disclosure Board. In a Waterloo-Cedar Falls Courier article on nonprofit spending in Iowa’s state elections, Ms. Tooker explains why the state hasn’t seen enormous outside spending increases in the wake of the Supreme Court’s 2010 decision in Citizens United:
IRS
Committee on Oversight and Government Reform: Lois Lerner’s Involvement in the Targeting of Tax-Exempt Organizations
Documents and information obtained by the Committee since the release of the TIGTA report show that Lois G. Lerner, the now-retired Director of IRS Exempt Organizations (EO), was extensively involved in targeting conservative-oriented tax-exempt applicants for inappropriate scrutiny. This report details her role in the targeting of conservative-oriented organizations, which would later result in some level of increased scrutiny of applicants from across the political spectrum. It also outlines her obstruction of the Committee’s investigation.
Prior to joining the IRS, Lerner was the Associate General Counsel and Head of the Enforcement Office at the Federal Elections Commission (FEC). During her tenure at the FEC, she also engaged in questionable tactics to target conservative groups seeking to expand their political involvement, often subjecting them to heightened scrutiny.6 Her political ideology was evident to her FEC colleagues. She brazenly subjected Republican groups to rigorous investigations. Similar Democratic groups did not receive the same scrutiny.
Wall Street Journal: New House GOP Report Reignites IRS Scandal
By John D. McKinnon
Newly disclosed emails show Ms. Lerner also took an interest in the application for tax-exempt status by Crossroads GPS, a big conservative player in the 2012 election that was co-founded by Karl Rove.
“Can you please send me a copy of the Crossroads [GPS] application? Lois wants Judy to take a look at it so she can summarize the issues for Lois,” says an IRS email from mid-2011 that is quoted in the report.
Lawmakers also accused her of misleading congressional investigators on multiple occasions, and said she appeared to help lead early efforts to write new rules cracking down on political activity by tax-exempt organizations.
Roll Call: Issa Issues Report Ripping Lois Lerner
By Matt Fuller
The California Republican issued a 141-page report Tuesday on the involvement of Lois Lerner, the former director of IRS exempt organizations, in the targeting of prospective tax-exempt organizations.
The report, which did not have signoff from committee Democrats, concludes that Lerner “created unprecedented roadblocks for Tea Party organizations” and “worked surreptitiously to advance new Obama Administration regulations that curtail the activities of existing 501(c)(4) organizations.”
Independent Groups
CQ Weekly: Will Taxable Groups Hide Political Cash
By Eliza Newlin Carney
But in fashioning their own Republican tracking operation, which they called America Rising, former Romney campaign manager Matt Rhoades and GOP organizers Tim Miller and Joe Pounder chose an unusual structure for a primarily political organization. Unlike its Democratic role model, America Rising operates principally as a limited liability company, or LLC — a type of hybrid business entity that is common in the broader business sphere but occupies an obscure and little-regulated niche in the world of politics.
Corporate Governance
More Soft Money Hard Law: Forms of Influence and the Best Bet
By Bob Bauer
Meanwhile, in the campaign world, the corporate speech at the center of the policy debate is nonprofit, political corporate speech—either through special-purpose entities that serves as vehicle for the expression of wealthy individuals’ ideological or political interests, or through established nonprofits, such as those now banding together across political differences to resist IRS restrictions on their “candidate-related” activities. The constitutional legal developments leading to Citizens Unitedran on this fuel.
All of this is taking place as business (and union, and other) interest spend heavily as required to influence policy in other ways, none of which seem to have the durable interest of the standard “money in politics” stories about campaign financing. Lobbying law is a neglected child in the field of political reform, and similarly secondary as a field of study are the standards that govern the officials’ responses—their ethical obligations—in responding to appeals for assistance or to arguments for particular policy outcomes.
Disclosure
NY Times: There’s a Big Difference Between Union Money and Koch Money
By DAVID FIRESTONE
The Times has long deplored the vast amount of cash that is polluting politics, whether it comes from the right or left. (And we were critical of a Democratic donor who plans to spend $100 million this year against candidates who ignore climate change.) But for the most part, unions, unlike the Koch network, don’t try to disguise their contributions in a maze of interlocking “social welfare” groups. Their contributions on behalf of candidates or issues may be unlimited, thanks to Citizens United, but they are generally clearly marked as coming from one union or another. (They want Democrats to know which unions raised the money.)
Tax Financing
Washington Times: Congress bans taxpayer funding for political conventions
By Stephen Dinan
Congress on Tuesday agreed to cancel its giveaway of taxpayer money to its own political conventions every four years, as the Senate cleared a bill to cut off funds.
Senators approved the bill by unanimous consent early Tuesday, sending it straight to President Obama for his signature.
“This is the type of bipartisan legislation that should move easily through theSenate,” Minority Leader Mitch McConnell said as he pushed the bill through.
Candidates, Politicians, Campaigns, and Parties
Washington Post: Hillary Clinton adviser Minyon Moore sought funds for illegal campaign, court papers allege
By Matea Gold and Rosalind S. Helderman
Washington businessman Jeffrey E. Thompson, who pleaded guilty Monday to federal conspiracy charges in a case that has focused largely on D.C. Mayor Vincent C. Gray’s (D) 2010 campaign, told federal prosecutors that Clinton aide Minyon Moore asked him to fund pro-Clinton efforts in four states and Puerto Rico costing $608,750 during the hard-fought 2008 Democratic presidential primary campaign, the documents show.
Thompson financed the operation through his accounting firm, at times funneling funds through a company owned by a longtime associate. A spokeswoman said Moore did not know that Thompson was funding the project off the books, adding that Moore had asked Thompson to raise money directly for the campaign.
CPI: Outside groups help boost David Jolly to victory
By Michael Beckel
Republican David Jolly tonight narrowly won Florida’s contentious 13th Congressional District election that attracted an astonishing $12.7 million as national partisans fought for bragging rights heading into November’s midterm election.
Outside groups spent nearly $5 million on Jolly’s behalf, according to the Center for Public Integrity’s analysis of FEC records, including the National Republican Congressional Committee ($2.2 million), the U.S. Chamber of Commerce ($1.2 million), the American Action Network ($470,000) and American Crossroads ($470,000).
FEC
National Journal: How A Mysterious Redacted Document Could Affect Money in Politics
By Shane Goldmacher
The Federal Election Commission was deadlocked, and no one was surprised. Democrats had wanted to crack down; Republicans didn’t. No matter that it could have been among the most important campaign finance decisions in years. No matter that the agency’s general counsel had recommended action. Divided equally and hopelessly by ideology, the six commissioners were at a stalemate.
It was all perfectly ordinary for this dysfunctional agency. All except for footnote 111.
The case involved complaints against Crossroads GPS, a nonprofit affiliated with Karl Rove that burst onto the national political scene in 2010 and had since spent tens of millions of dollars on campaign advertisements. For the FEC, the question was whether all of that political spending meant that Crossroads was not, in fact, a nonprofit—and thus entitled to keep secret its list of donors and details of its activities. The outcome had the potential to impact what politically minded nonprofits everywhere—from the Koch Brothers’ vast network to Organizing for Action, the outgrowth of President Obama’s campaign—could and couldn’t do.
