[EL] Small and Large Donors (and Recusal)
Trevor Potter
tpotter at capdale.com
Mon Nov 25 11:13:04 PST 2013
With all respect to Mark, when McCain Feingold was passed, IEs with corporate and labor union funding were illegal. The authors of McCain Feingold sought to ensure that elected officials were not able to raise money directly or indirectly for soft money outside groups--a goal that was frustrated by FEC coordination regulations challenged in court by the Congressional Sponsors as grossly inadequate, and by FEC Advisory Opinions that allowed candidate " wink and nod " participation in fundraising for such outside groups. The result is that funds are currently solicited for, and contributed to, outside groups closely tied to candidates, contrary to the design of BRCA.
Sent from my iPad
On Nov 25, 2013, at 2:01 PM, "Mark Schmitt" <schmitt.mark at gmail.com<mailto:schmitt.mark at gmail.com>> wrote:
1. Anyone could have predicted that contribution limits would encourage independent expenditures. It's one of the first things I learned about the topic, years ago, when some states were playing with low contribution limits. The only question is, at what level do limits have that effect, and whether the system can be set up to put other burdens on independent, or not-really-independent expenditures. The authors of McCain -Feingold believed that if elected officials were not able to directly raise money for outside committees, the party soft money that Clinton had been raising would not naturally shift over to outside groups. They were wrong about that, especially after Citizens United. But the basic substitution is no surprise.
2. With all respect for your 44 years, the tremendous fundraising advantage of incumbency, and the number of corporations that seem to split their giving about 60:40 toward the party in power, suggests that big donors are doing much more than just supporting people they agree with philosophically.
Mark Schmitt
202/246-2350
gchat or Skype: schmitt.mark
twitter: mschmitt9
On Mon, Nov 25, 2013 at 12:46 PM, Larry Levine <larrylevine at earthlink.net<mailto:larrylevine at earthlink.net>> wrote:
Look. Broad participation is a laudable goal. But you have identified the problem with this whole discussion – it’s academic. When the academic collides with the real world things start to fall apart and all of the “unintended” consequences start to bight us. Who could have predicted contribution limits would give birth to independent expenditures and super PACs. Certainly not any of the reformers or academics who now decry independent expenditures. The history of independent expenditures in the wake of contribution limits in California and in Los Angeles is illustrative. In my 44 years of campaign experience I would say the overwhelming majority of campaign contributions have gone from donors to candidates with whom they agree philosophically. No one is being bought. It’s people supporting people who they like, or who they believe will represent them well. Yes, that includes builders and developers and oil companies and tobacco companies and the Sierra Club and the Consumer Attorneys and everyone else who has an interest in the process.
Larry
From: law-election-bounces at department-lists.uci.edu<mailto:law-election-bounces at department-lists.uci.edu> [mailto:law-election-bounces at department-lists.uci.edu<mailto:law-election-bounces at department-lists.uci.edu>] On Behalf Of Mark Schmitt
Sent: Monday, November 25, 2013 9:30 AM
To: law-election at department-lists.uci.edu<mailto:law-election at department-lists.uci.edu>
Subject: Re: [EL] Small and Large Donors (and Recusal)
This is intriguing, and definitely a reminder that both the academic debate, and the semi-public debate, fails to notice all kinds of interesting experiments at the municipal and state level.
I like that this approach puts the responsibility on the public official to behave ethically. However, if you had a large number of $200 donors in a community (and you should want to), then legislators might find themselves in the situation where they would have to recuse themselves quite frequently. That would mean that the dynamics of who recused would itself have a huge impact on the outcome of decisions -- changing the composition of committees or commissions, or shifting a decision from one agency to another that would handle it differently. (I think this happened in Parks and Rec.) It would also give a lot of substantive power to whatever agency enforced the law.
On the other hand, if you have a large number of $200 donors, and most elected officials are receiving support from a lot of different people, with different interests, the recusal process becomes less necessary. If I'm deciding the zoning case of someone who gave my campaign $250, I'm a lot more likely to ignore that fact if I have 1,000 other donors at that level. That's one of many reasons that encouraging small donors, and broad participation, is so important.
Mark Schmitt
202/246-2350<tel:202%2F246-2350>
gchat or Skype: schmitt.mark
twitter: mschmitt9
On Sun, Nov 24, 2013 at 10:43 PM, Justin Levitt <levittj at lls.edu<mailto:levittj at lls.edu>> wrote:
FWIW, Prof. John Nagle discussed an idea akin to Rob's "Westminster Approach" in his 2000 piece on legislative recusal, here<http://ssrn.com/abstract=969810>. I suggested that the concept might also be extended to independent expenditures, in my reaction piece to Citizens United, here<http://ssrn.com/abstract=1676108>.
That said, my suggestion was designed for the sort of outsized campaign support seen in cases like Caperton -- a hefty sum, and many times larger than any other contribution or expenditure in the race. That sort of support would seem most likely to incur an incumbent's gratitude to an extent not "shared with a substantial segment" of the other donors. Maybe $200 is a similar pot of gold in Westminster, but I am skeptical that a $200 contribution would earn special political favors in a city with 100,000 residents.
Justin
--
Justin Levitt
Associate Professor of Law
Loyola Law School | Los Angeles
919 Albany St.
Los Angeles, CA 90015
213-736-7417<tel:213-736-7417>
justin.levitt at lls.edu<mailto:justin.levitt at lls.edu>
ssrn.com/author=698321<http://ssrn.com/author=698321>
On 11/24/2013 6:01 AM, Robert Wechsler wrote:
Thanks, Michael, for posing the issue as you did. The issue of small and large donors is an important one, which has been studied primarily by only one side of the ongoing dispute.
Michael Malbin has written most on the issue. See the CFI page on this topic<http://www.cfinst.org/smallDonors.aspx>, which has links to lots of reports and articles on the topic.
With respect to New Haven's public financing program, a local newspaper, the Independent, has published a valuable analysis of the campaign contributions in this year's election<http://www.newhavenindependent.org/index.php/archives/entry/oct_10_money_maps/> (which I was not involved in).
Besides the wealth of large vs. small donors, at the local level especially there is another large difference between them. At the local level, small donors tend to be expressing their political support for candidates. Most of the large donors are either involved with the political party or faction, or have a financial interest in the local government's decisions. The latter group is essentially expressing their recognition that if they do not give, they may not get to keep their contracts (or get new ones), they may not get the next permit or grant they request, inspectors might come down hard on them or, for government employees, they may not get a promotion or may even lose their jobs. That is why the latter group tends to give primarily to incumbents and their perceived successors.
In other words, the two kinds of contributions — small and large — tend to be different both in quantity and in quality, and the donors have different reasons and incentives for giving.
Speech is not an absolute. There needs to be a serious discussion of the quality and quantity of these different kinds of speech, and of ways to deal with them.
For example, an alternative approach to limiting contributions that involve influence or pay to play is what I call the Westminster Approach<http://www.cityethics.org/files/lgep1-0%20-%20Robert%20Wechsler.htm#Westminster%20approach>, after the town in Colorado that first employed it. Here is the language for the City Ethics version of this approach:
An official or employee may not use his or her official position or office, or take or fail to take any action, or influence others to take or fail to take any action, in a manner which he or she knows, or has reason to believe, may result in a personal or financial benefit, not shared with a substantial segment of the city's population, for ... a person or entity from whom the official or employee has received an election campaign contribution of more than $200 in the aggregate during the past election cycle (this amount includes contributions from a person's immediate family or business as well as contributions from an entity's owners, directors, or officers, as well as contributions to the official or employee's party town committee or non-candidate political committee)
No speech is limited here. Instead, a sizeable contribution creates a conflict that requires the recipient's withdrawal from matters involving this sort of donor.
I've been advocating this approach for five years, and although citizens across the country have taken it up and advocated for it, I have not seen an academic discussion of it.
Rob
On 11/23/2013 1:01 PM, Michael P McDonald wrote:
Sometimes how people talk past one another illuminates the real issue at stake.
Rob is talking about a public financing system to increase the speech of small donors, presumably through a contribution matching system.
Larry is talking about raising campaign contribution restrictions to increase the speech of large donors.
I would be interested to see if Rob's assertion is true that there is a tradeoff between small and large donors; that is, when public financing systems were changed to allow candidates to pursue more large donor contributions, the number of small donors decreased. If that can be established, the Supreme Court might take a different position if the Justices perceived a trade-off between the speech of small and large donors. The result might also be further experimentation with hybrid public financing systems with the goal to encourage both large and small donations.
Maybe I am more sympathetic to Rob's position, but I see his comment as pleading with those who think only in terms of campaign contribution limits as restricting speech to join in encouraging speech of all citizens, not just the wealthiest among us. If one really cares about speech, isn't that the compromise point in this debate?
============
Dr. Michael P. McDonald
Associate Professor
George Mason University
4400 University Drive - 3F4
Fairfax, VA 22030-4444
phone: 703-993-4191<tel:703-993-4191> (office)
e-mail: mmcdon at gmu.edu<mailto:mmcdon at gmu.edu>
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From: law-election-bounces at department-lists.uci.edu<mailto:law-election-bounces at department-lists.uci.edu> [mailto:law-election-bounces at department-lists.uci.edu] On Behalf Of Larry Levine
Sent: Saturday, November 23, 2013 12:26 PM
To: 'Robert Wechsler'; 'Smith, Brad'
Cc: law-election at uci.edu<mailto:law-election at uci.edu>
Subject: Re: [EL] Civic Courage, Indeed
You sidestep the fact that limiting campaign contributions is limiting speech. It may be justified legally by a higher purpose of fighting corruption. But the end result is that it has limited speech and in turn has restricted the right to redress. And by the way, contribution limits is the father of independent expenditures, which the reform community seems to hate. Simple fact: you will never get rid of the perception of corruption; in the last 40 years we have passed all manner of restrictions and regulations and the perception is worse than ever. There is an American institution devoted to promulgating the perception of corruption. It's comprised of comedians from Will Rogers to Jay Leno and given life by "reformers" who see corruption everywhere and have made an industry of figh 20;Those who would sacrifice liberty for security deserve neither." The same can be said of those who would sacrifice speech in quest of the shadow of corruption.
Larry
From: law-election-bounces at department-lists.uci.edu<mailto:law-election-bounces at department-lists.uci.edu> [mailto:law-election-bounces at department-lists.uci.edu] On Behalf Of Robert Wechsler
Sent: Saturday, November 23, 2013 4:22 AM
To: Smith, Brad
Cc: law-election at uci.edu<mailto:law-election at uci.edu>
Subject: Re: [EL] Civic Courage, Indeed
the reform community doesn't bring anything to the table. Each battle they lose in court seems to be nothing but an excuse to seek other, new ways to regulate, intimidate, or otherwise silence speakers. Each battle they lose in the legislatures is merely a temporary setback to their next effort. Even many of the purest reformers will happily ally themselves with any corrupt politician who clearly does simply want to suppress his opposition. They call their opposition "ideologues," but there is one constant in their view - an ideological commitment that things must be regulated.
Demonizing is not a way to seek compromise and deal effectively with corruption. As a proud member of the reform communit seek new ways to get more speakers, and I have succeeded. While Administrator of the New Haven Democracy Fund, a public campaign financing program, and since I left, both the number of candidates and the number of contributors grew. People who had never thought of making a campaign contribution got involved and made their voices heard.
Public campaign financing isn't even regulation - it's voluntary. And yet you and your crowd have done what you can to undermine it. We had to change our program to meet the new restrictions on the speech, both of candidates and of contributors, that were imposed by the Supreme Court at your behest. The result was that insider candidates chose not to participate in the program. The program has still been successful, but your efforts undermined speech, and enabled a situation where contractors and developers (who don't give to outsider candidates) gave larger contributions and not only helped incumbents and their successors to win elections, but lay environment in the city.
So don't be such a holier-than-thou demonizer. You are part of the problem, even with respect to what you say you are fighting for. And most of us reformers support a solution that does not involve regulation, intimidation, or the silencing of anyone.
It's sad that, to justify what you do and the problems you create, you have to demonize others. It's sort of like war, isn't it?
Rob Wechsler
City Ethics
On 11/22/2013 11:37 PM, Smith, Brad wrote:
"The CCP crowd sees the spending as pure and spontaneous expressions of political views."
&nb >
I would not agree with either of the first two adjectives in that sentence. I don't think most of us think these views are always pure, and rarely are they spontaneous.
"Those who worry about corruption" . include me and my guess is most of us in the "CCP crowd" (and thank you for the endorsement). The question is the degree of worry, especially when placed against other values and issues, and further, the extent to which efforts to end "corruption" are themselves a source of corruption in the process.< ize:10.0pt;font-family:"Tahoma","sans-serif"'>
"People give or spend because someone asks them to." Of course they do. I'd be shocked if there were disagreement here.
"That's [preventing corruption] the justification for for coordination rules that identify certain individuals who are unlikely to be or be seen as truly independent, not that certain people's speech is restricted." Of course it is almost always the stated objective, and o ctive. Nevertheless, and even in the latter case, it does restrict certain people's speech.
"if it was all just donors expressing their views, campaigns wouldn't have to spend 12% of their money and often more than half of their candidate's time on fundraising." This statement is, I think, factually very wrong. Charity Navigator, for example, considers fundraising expenses of just 10-15% to be very good for a charitable enterprise. It cost money to raise money, and to convince people that a cause is worthwhile.
"But in all but a handful of states, voters and legislators have democratically decided that contribution limits at some level are appropriate,." I think many people feel that the constitution correctly places limits on what democratically elected governments can do.
"and the Court has agreed." And those people are trying to persuade the Court that it got it wrong.
&nb >
"Without coordination rules, those limits are meaningless, and it seems entirely reasonable that prosecutors should enforce those laws."
I think the objection is that the cost of enforcing those laws - even if they are legitimate - is high, and often not taken into account. Coordination investigations probably offer the greatest possibility in the campaign finance world for abuse of prosecutorial power, and as such they also destroy confidence in government by creating - dare we say it - an appearance of corruption. Even when investigations are properly motivated, they have the potential to particularly suppress la er campaign finance investigations. It is perfectly legitimate to suggest that these are high costs that ought not be ignored. Moreover, it is perfectly predictable that almost every high-profile coordination investigation will raise suspicions of corrupt behavior by prosecutors and complainants. That is why I'm not hearing people say the coordination laws should not be enforced - rather, I am hearing them say that either a) they should not exist, because the benefits are not worth the co!
sts; or
b) they should narrowly circumscribed, because otherwise the benefits are not worth the costs.
Mark essentially argues "it's the law, and it should be enforced." This is not a convincing argumen hould not be the law, and use examples of enforcement to illustrate why it should not be the law.
The Constitution plainly circumscribes the extent to which government can regulate speech. Some may be more absolutist on that than others, but I don't think anyone on this list would disagree with that basic proposition. The Court has long held that political speech is at the core of the First Amendment. I think most people would agree, in theory if not always in deed, with that statement. It is entirely reasonable, then, that many people will seek to circumscribe the authority of government to regulate political speech generally, and given the particularly intrusive nature of coordination investigations pacity for political and prosecutorial abuse, to limit the reach of such laws, and to point out possible abuses of the law by political partisans and zealous prosecutors, politicians, and bureaucrats.
I have written that the court is incorrect in allowing contribution limits. But I have also written that the dichotomy between contributions and expenditures is not non-sensical, and given that one rarely wins complete and lasting victories in politics, I could live with a compromised world. Reporters used to like to ask me if it would bother me if Bill Gates gave a candidate a million dollars. My answer was always, "no, but if that were the rule this wouldn't have become my life's w yle='font-size:10.0pt;font-family:"Tahoma","sans-serif"'>
Unfortunately, I have seen little indication that the "reform" community is prepared to live with me in a world compromised to both of us. As Mark well knows, because he helped, that community spent hundreds of millions trying to upset the Buckley status quo. It did not seem to occur to them that "Buckley's rotten tree" (to use Burt Neuborne's old phrase), when pushed, might fall in a different direction than they planned. So long as there is a constant effort to expand the reach of campaign finance regulation, there will be pushback, and that pushback is not illegitimate simply because it argues, at times, for changing the law, or because it points out potential abuses of the law.
Courts, by their nature, can rarely broker a halfway position (Buckley was a valiant effort). I think Mark Scarberry reflects the views of a lot of people on the pro-speech side of the debate when he wrote in this thread:
"I'm not happy that people with money get to have such a disproportionate impact on elections. . [But] With media of all kinds that have tremendous power to affec cumbency providing such an advantage (including by way of a President's ability to use incumbency to speak in an almost unlimited way to the public and to manipulate information), and with the inevitability that regulation will be used to protect incumbents and others who already have power, I have to come down on the anti-regulation/pro-free speech side."
When I read that, I hear a guy who would be prepared to compromise, and I think he speaks for many. Within the scholarly community, there is room for compromise. A growing number of pro-reform scholars, for example, agree that there should be significantly higher disclosure thresholds, higher contribution limits (oft and greater sensitivity to speech concerns. But the reform community doesn't bring anything to the table. Each battle they lose in court seems to be nothing but an excuse to seek other, new ways to regulate, intimidate, or otherwise silence speakers. Each battle they lose in the legislatures is merely a temporary setback to their next effort. Even many of the purest reformers will happily ally themselves with any corrupt politician who clearly does simply want to suppress his opposition. They call their opposition "ideologues," but there is one constant in their view - an ideological commitment that things must be regulated. It seems that ref!
ormers t
oday, as they have for 40 years, see themselves as just one FEC commissioner, one Supreme Court justice, one scandal away from that total political victory. That community, however, has lost a lot of ground in the past decade. I suspect that it will soon lose more, unless it can change and come more serious ments of its tormenters.
Bradley A. Smith
Josiah H. Blackmore II/Shirley M. Nault
Professor of Law
Capital University Law School
303 E. Broad St.
Columbus, OH 43215
614.236.6317<tel:614.236.6317>
http://law.capital.edu/faculty/bios/bsmith.aspx
________________________________________
From: law-election-bounces at department-lists.uci.edu<mailto:law-election-bounces at department-lists.uci.edu> [law-election-bounces at department-lists.uci.edu<mailto:law-election-bounces at department-lists.uci.edu>] on behalf of Mark Schmitt [schmitt.mark at gmail.com<mailto:schmitt.mark at gmail.com>]
Sent: Friday, November 22, 2013 10:04 PM
To: law-election at uci.edu<mailto:law-election at uci.edu>
Subject: Re: [EL] Civic Courage, Indeed
I've never found "appearance of corruption" to be all that conceptually useful, although i long history in the legal doctrine.
But it seems that every time one of these arguments disrupts this otherwise placid list, we're really dealing with two totally different conceptions of what happens when people make expenditures and/or contributions intended to affect the outcome of an election: The CCP crowd sees the spending as pure and spontaneous expressions of political views. Those who worry about corruption tend to see transactions: People give or spend because someone asks them to. Anyone who supports contribution limits, even at a much higher level than the current ones, implicitly accepts the basic notion that if an elected official could ask a donor for $10 million, and get it, the prospect of corruption is very high. But what if the transaction takes the form of Bill Burton or Carl Forti making the ask on behalf of Priorities USA or Restore Our Future? In the donor's eyes that's about as close to an ask from Obama or Romney himself as you can get. B ons and their histories with the candidat!
e provid
e the donor with reassurance that the "independent" message will at least not be at cross-purposes to the campaign itself. With those two assurances, for the donor, there's really no difference between that transaction and a direct contribution to the campaign, other than the amount.
That's the justification for for coordination rules that identify certain individuals who are unlikely to be or be seen as truly independent, not that certain people's speech is restricted.
Obviously, there's a mix between contributions/spending that is a pure expression of viewpoint and that which is the result of a transaction with someone who hopes for access to power, and many transactions have a little bit of both. But if it was all just donors expressing their views, campaigns wouldn't have to spend 12% of their money and often andidate's time on fundraising.
I realize that some on this list would eliminate contribution limits entirely, which would eliminate much of challenge of figuring it what independent expenditures are not really independent. But in all but a handful of states, voters and legislators have democratically decided that contribution limits at some level are appropriate, and the Court has agreed. Without coordination rules, those limits are meaningless, and it seems entirely reasonable that prosecutors should enforce those laws.
Mark Schmitt
202/246-2350<tel:202%2F246-2350>
gchat or Skype: schmitt.mark
twitter: mschmitt9
Thank you, Robert, for helping to fill in a few of the details on what I'm sure will be the ever-growing list of Americans who are prohibited from exercising their First Amendment rights based on appearances, or at least the appearances preferred (disfavored?) by the 'reform' community. I look forward to reading about more Americans who need to go on this list. Perhaps it could be cross-referenced with Santa's naughty/nice list?
Sean Parnell
President
Impact Policy Management, LLC
6411 Caleb Court
Alexandria, VA 22315 class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'>571-289-1374<tel:571-289-1374> (c)
sean at impactpolicymanagement.com<mailto:sean at impactpolicymanagement.com>
From: Robert Wechsler [mailto:catbird at pipeline.com]
Sent: Thursday, November 21, 2013 8:01 AM
To: Scarberry, Mark; sean at impactpolicymanagement.com<mailto:sean at impactpolicymanagement.com>
Cc: law-election at uci.edu<mailto:law-election at uci.edu>
Subject: Re: [EL] Civic Courage, Indeed
Dear Mark and Sean:
I think it is too often forgotten that campaign finance is part of government ethics. Therefore, basic government ethics principles can seem foreign to the conversation.
Both of yo s often don't like each other's politics. In fact, they often don't like each other, period. But that does not make them any less conflicted with respect to their candidate/official sibling. And the public, which does not know the details of any sibling relationship (see all of literature for the complexities involved), sees the same thing no matter what the relationship actually is. And they are right to. Equally, governments are right to create clear conflict rules, rather than basing them on a vague concept of appearance.
I have never seen a conflict of interest provision that differentiates between siblings that like or agree with their siblings. This equal treatment of siblings, and others, is a basic government ethics principle. It should apply equally in campaign finance.
Mark asks, "Would a family member be disqualified under this standard from organizing an independ ily member's election?" The family member would still be conflicted, but would coordination still be a concern?
Well, it could be a fake supporter of an opponent. There are so many fakes in recent elections that this kind of fake would not be surprising. Considering how effective some outside independent groups have been at shooting those they support in the foot, I would argue that a coordinated opposing group would be a clever tactic.
The other basic concept that seems to be missing here is power. Both of you seem to think that family relationships involve political ideas. No, family relationships tend to involve power. The Cheney sisters' public disagreement is atypical, as are Carville and Matlin.
With respect to independent groups, the principal issue involving family members is not ideas. The principal issue is family members being seen as coordinating to help one member get elected, to get power.
I don't share all the views of the sen , but I know that if I were to form a supposedly independent group that took sides in his next election, no one who knew about the relationship would believe there was no coordination. The First Amendment isn't all that relevant here. No one has a First Amendment right to insist he is not coordinating with his stepson when the public reasonably believes that he is coordinating. This is about fraud and making a mockery of rules that are intended to prevent corruption, not about a marketplace of ideas.
Rob
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