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Sunday, December 4, 2016

The Campaign Finance Free-For-All: How We Got To This Point

The Campaign Finance Free-For-All: How We Got To This Point

by Justin Elliott, ProPublica

In a forthcoming law review article, Richard Briffault of Columbia Law School argues that the rise of Super PACs and unfettered contributions and spending this election cycle are “effectively ending the post-Watergate era of campaign finance laws.”

To help understand what is shaping up as a watershed election cycle, I asked Briffault to explain the path that took the country from stringent post-Watergate contribution limits through Citizens United to today’s multibillion-dollar free-for-all.

Briffault has written extensively about the history of campaign finance law. He has filed amicus briefs in cases on the side of defending regulation. His article on Super PACs will be published in the Minnesota Law Review.

Our conversation has been edited for length and clarity.

Can you explain how the 1976 Buckley v. Valeo case created the foundation of modern campaign finance law?

In the Buckley case the Supreme Court held that the First Amendment applies to campaign finance regulations, but it applies in different ways to different kinds of campaign finance activities. Contributions — that is, giving money to a group, a candidate, or a political party — are less protected. The court said that contributions raise the danger of corruption, that is, that candidates will feel indebted to their large donors, and also that contributions are less pure speech than expenditures.

The court said that an expenditure, which is money being spent on communications to the voters to persuade them how to vote, gets the highest level of protection. The court said that that kind of spending cannot be limited because it comes closer to pure speech and because it raises no danger of corruption.

A particularly difficult question involves what are called independent expenditures. Having reached the limit on the amount of money he is allowed to give a candidate, the donor might then just make an expenditure by taking out his own ads praising the candidate, or condemning the candidate’s opponent. In Buckley, the court said that so long as such an expenditure is not formally coordinated with the candidate, it will get the full constitutional protection of expenditures.

The first big loophole in the law that politicians exploited became known as “soft money.” The symbol of the soft money era was Democratic donors sleeping in the Lincoln Bedroom under President Clinton. How did that happen?

As a result of some rulings by the Federal Election Commission, the political parties were allowed to accept unlimited donations and corporate and union money so long as the political party used the money not for direct candidate support, but for background activity, like voter registration and get-out-the-vote drives and certain kinds of advertising that avoided express advocacy of the election or defeat of candidates. Because the money did not go for direct support of candidates — although it certainly helped candidates — it was considered “soft money” not subject to the restrictions on the “hard money” used for direct support of candidates.

The parties and their donors started to figure out soft money in the late 80s and it really took off in the 90s, peaking in 2000 and 2002.

So the famous McCain-Feingold law passed in 2002 and was upheld by the Supreme Court in 2003. Explain the system that law created.

McCain-Feingold stopped the parties from collecting and using soft money. Many experts thought the parties would be hit hard by the soft money ban, but in 2004 they actually replaced all the lost soft money by redoubling their efforts to collect more hard money from individual donors.

However, there was an immediate effort to get around the soft money ban through so-called 527 committees, which were named after a section of the tax code and were in effect a kind of political committee. The idea was that they would act independently of candidates, and engage in issue advocacy that helped candidates but did not expressly support them. The theory of the 527 was that they’re not working with the candidates and they’re not working with the parties, and they’re also not engaged in express electioneering. So they claimed that they could take unlimited individual, corporate, and union contributions.

How big a role did corporate money play in funding these 527s?

There wasn’t actually very much corporate money in the groups, but you did see large individual donations to organizations like MoveOn and the anti-John Kerry Swift Boat group. For the first time since Watergate, you began to see the first real appearance of million-dollar donations.

This is the last time the Federal Election Commission actually took any action. It brought enforcement actions against a number of the prominent 527s and several years later obtained significant multi-hundred-thousand-dollar penalties from them. The commission said that a number of the 527s had crossed the line into regulated electioneering and should have abided by the rules limiting contributions and disclosing spending.

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