Assignment Two Campaign Finance Laws: Money in, Money Out By Jason Howard Tuesday, Dec 10 2013

In this assignment I will discuss recent developments in campaign finance law, focusing on the effects of the Citizen United and Speech Now decisions, the growth of SuperPACs, 501 c(4),

independent spending and how they have changed the ways elections are funded. In addition, attention will be paid to how the campaign strategies of candidates and interests groups have changed within the new fundraising environment. Next, I will attempt to discuss whether these changes, and their effects, pose a major problem for democracy. Modern campaign finance law came into shape in 1971 with the Federal Election Campaign Act (FECA), it mainly focused on expenditure limits and forming a structure for the disclosure of information of funds (Garrett, 2013). Campaign finance laws remained largely unchanged until the The Bipartisan Campaign Reform Act (BCRA) was passed in 2001, aimed at banning unregulated soft money and electioneering ads. In addition, BCRA prohibited the use of treasury fund of corporations and labor unions to contribute to electioneering advertising, issue advocacy and party donations, as it expressed advocacy (Garrett, 2013). In January 2010, the Supreme Court issued a decision on Citizens United v. Federal Election Commission (Citizens United) that lifted the use of the treasury funds prohibited by the BCRA, allowing for the funding of independent expenditures that are electioneering communications directly supporting or opposing candidates. SpeechNow.org v. Federal Election Commission (SpeechNow), another 2010 decision held that there could be no limit on expenditures for PACs that only make independent expenditures, those that are not directly affiliated with a candidate (Garrett, 2013). These recent campaign finance changes come together with the rise of SuperPACs and 501 c(4) groups. These are entities that have been taken advantage of as vehicles for campaign spending deemed as not directly part of campaigns, independent spending. SuperPACs are committees that formed after SpeechNow, allowed for the unlimited fundraising and expending of money with the provision that the SuperPAC not directly support a candidate. As of July 23, 2013, SuperPACs report total independent expenditures of $609,417,654 and total receipts of

$828,224,595. (Opensecrets). IN 2010 there were 83 SuperPAC's, in the 2012 election, 1,310. 501 c(4) groups are social welfare organizations, meaning that they must primarily provide for a common good or the welfare of a community, this is however, a loose term. 501 c(4)s have long been involved with lobbying e.g. Sierra Club, National Rifle Association, Planned Parenthood, but since Citizens United, these organizations, and those that arise only before elections can raise and spend unlimited sums. The most important feature to note when comparing SuperPACs and 501c(4) groups is that SuperPACs must disclose donations and expenditures while 501 c(4) groups do not; there are no concrete ways to know exactly how if they even do spend their donations. The effect of the SpeechNow and Citizens United decision allowing for unlimited spending on independent expenditures has been somewhat rhetorical. This is to say that the spending habits of large donors are relatively similar, but it is the sheer quantity of spending coming from both sides that is changed. It has long been the conclusion of researchers that large amounts of spending can help a challenging candidate, or party that is seeking to gain a majority in their respective house. In a New York Times article Carter Eskew, a Democratic advertising exec. was asked what he thinks is really needed for a campaign and his answer was $500 million (Bai, 2012). Not a small sum, indeed, but he instead to the reporter that anything else would be overkill and that is including outside spending. The amount spent by the challenging party is usually greater than that of the incumbent; donors are willing to spend more for change, rather than more of the same. If that is really the case, that there is a logical cap to how effective campaign spending can accomplish, why is so much money being spent? Money does not always win elections, looking to Rudy Giuliani's primary campaigns, Steve Forbes and others; it is often good campaigning that will win a primary, and later an election. Some things havent changed

drastically since Citizens United and Speech Now, some of the same companies and individuals who are donating large sums could have done the same by donating 527, though now with 501 c(4) those donations go undisclosed. While it is not the case that many think, that corporations can donate unlimited amounts of money to campaigns, they can donate to campaign advertising. So is all this money leading to corruption? Does it lead to more informed voters? There doesnt seem to be evidence to show either. However, I see a paradox in this: If corruption is as entrenched into politics as some may claim, it is likely the fact that it is so buried that it can even exist. Simply put, if you knew about the corruption you would not be calling it corruption, you cannot find the true criminals because they are so good at being criminals. Of course, there could be watershed moments and cases of good investigative journalism that can show exactly how there is corruption. Voters respond to negative advertising, not by changing their minds, but shoring up voters who were already likely to vote for the other candidate (Dingfelder 2012). Whether all this money is actually threatening, democracy is redundant. Democracy was already trampled by a system that is found away to take the inherent factionalism needed for a democracy and make that inherent disagreement the main issue. That is what is threatening democracy. No, the massive amounts of cash flow flooding advertisements and political committees and interest groups and into electioneering and issue advocacy do not help this, they perpetuate it. It is unlikely someone will donate $10 million to an ad campaign defusing the arguments that revolve around a campaign. That would make too much sense.

Citations

Garett, R. S. (2013 November 7). Retrieved from website: http://www.fas.org/sgp/crs/misc/R41542.pdf

Dingfelder, S (2012 April). Retrieved from website:http://www.apa.org/monitor/2012/04/advertising.aspx

Bai, M. (2012, July 17). How much has citizens united changed the political game? The New York Times, Retrieved from http://www.nytimes.com/2012/07/22/magazine/how-much-hascitizens-united-changed-the-political-game.html?pagewanted=2&pagewanted=all&_r=0