An Idiot’s Guide to Money in Politics
By Heather Somers
Richard Hasen
|
Just when political reporters thought they had campaign finance laws figured out, this election year kicked off with a whole new set of rules. Enactment of the Bipartisan Campaign Reform Act of 2002 (BCRA), known as McCain-Feingold, is the latest change in a 30-year effort to refine campaign finance regulations.
Richard Hasen, a professor at Loyola Law School, gave a primer on the subject to a group of journalists attending a Western Knight Center seminar on campaign finance, taking a brief walk through the history of money in politics - from Watergate reforms, to soft money, to President Bush’s so called “Pioneers” campaign contributors.
“These laws were in response to the free-market approach to campaign finance in the wake of Watergate,” said Hasen of the 1974 Federal Election Campaign Act amendments, which set the basis for modern campaign finance law and created the Federal Election Commission.
Hasen laid out the four basic types of campaign finance laws:
- Contribution limits, which restrict how much money an individual or entity can donate to a candidate or political committee.
- Expenditure limits, which limit how much money an individual or entity can spend independently either in support or in opposition to a candidate.
- Disclosure rules, which lay out what needs to be disclosed to the government.
- Public financing laws, which generally only apply to the presidential race and a few states that have enacted such laws.
The precise implementation of these rules was clarified by the Supreme Court in its landmark 1976 decision in Buckley v. Valeo. Buckley altered the 1974 law and set a precedent for what was considered protected speech in the arena of campaign finance rules.
The high court’s Buckley ruling resulted in the following:
- The court upheld contribution limits because it said they only had a “marginal effect” on First Amendment rights of free speech. The symbolic speech effect of a donation still exists “whether an individual donates $1,000 or $10,000.”
- The court struck down expenditure limits on First Amendment grounds because it said that such limits might prevent individuals from engaging in the political process through election-related spending.
- The overriding interest for upholding campaign finance laws was to prevent corruption, or the appearance of corruption. This threat trumps any First Amendment concern (for contribution caps).
But the ruling also led to the advent of soft money. Hasan noted that the effect of the Buckley decision was that it opened the door to “sham issue ads” and the need to pay for such ads in turn led to the explosion of soft money.
Corporations and unions that had been prohibited from spending or donating money in political campaigns were now able to buy issue ads - as long as those ads didn’t “expressly advocate” in favor or against a candidate. Money for these activities went through political action committees created by the corporations and unions. This happened because, while individuals were capped at $25,000 per year, PACs weren’t.
Campaign Finance Today
BCRA, said Hasen, was the response to a rash of abuses during the 1996 election—primarily the selling of the Lincoln Bedroom by the Democrats and the sale of rounds of golf with Republican members of Congress.
BCRA’s highlights include:
- Bans almost all soft money - even at the state and local levels.
- Redefines issue and election-related speech.
- Regulates all TV and radio ads close to elections in an effort to reign in issue ads.
- Requires that candidates for federal office appear in their ads.
As with Buckley before, litigation soon followed claiming the law was unconstitutional.
Sen. Mitch McConnell (R-KY) filed suit, and in December 2003, the Supreme Court ruled in favor of the law, upholding the soft money limitations and the electioneering provisions, including extending the ban on direct corporate and union spending.
The 527 Question
Hasen attempted to navigate the audience through the latest campaign finance creation - the 527s, the tax-exempt independent organizations that have been active at running ads and raising money outside the parties and campaigns.
He explained that because the 527s are not party committees and have no direct connection with candidates they can’t provide their donors with access to candidates. They are “truly independent spending,” he said. They are also vehicles for unlimited soft money contributions. Political advocacy groups like MoveOn.org and Americans Coming Together were cited by Hasen as examples of newly created 527s.
Hasen concluded with a caution. He said the current law is “hanging by a thread. All it would take is one justice to change their mind or add a new justice and we could see the current construction of campaign finance completely altered.”
|
