[EL] What (Then) Non-Millionaire Benefitted from The Millionaire's Amendment in the McCain-Feingold Law?

Wed Mar 22 03:53:34 PDT 2017

Had the Court not invalidated the Millionaire's Amendment, I think we would have increasingly seen situations where the statute simply didn't work: where the election's unusual circumstances created ambiguities that the Commission couldn't practically resolve except through enforcement. By the time Davis came up, the canaries were already fluttering around the coal mine:

- First there was the 2006 House special election in California's 50th District, where the special election runoff coincided with the regular primary election: did a self-financing candidate's spending trigger enhanced limits in one election, both, or neither? http://saos.fec.gov/aodocs/2006-06.pdf.

- Then there was the Connecticut Senate election, in which self-financing Ned Lamont and incumbent Joe Lieberman squared off in three separate elections over a six-month period: the convention, which is a primary under FEC rules; a subsequent primary, which is a separate election, http://saos.fec.gov/aodocs/2004-20.pdf; and then finally the general election, in which Lieberman ran as an independent candidate. The complexity of the Amendment's calculations and the resulting "game theory" considerations made the Amendment's operation very challenging.

- Finally, there was the fact that the Amendment relied on self-reporting by the self-financing candidate to trigger the enhanced limits. If that candidate, like Melville's Bartleby, would simply "prefer not to" file her opposition personal funds notice - or, more realistically, if she could contrive some basis not to file it, based on the complexities above - then could her opponent engage in self-help and raise under the enhanced limits anyway? Not unless that opponent wanted to look down the barrel of hundreds of thousands of dollars in refunds and penalties. It would have been interesting to see what would have happened if the Amendment had survived Davis and hit the FEC circa 2009. The Amendment relied on massive penalties for deterrence and compliance, and yet the Commission began to shy away from those same penalties, often for the stated reasons of complexity and ambiguity in the underlying legal standard.

The Millionaire's Amendment is certainly a good subject for a ConLaw class. It would be a fantastic subject for a legislative drafting class. It would have thoroughly tested the maxim that "the involutions and varieties of vice are too many and too artful to be anticipated by positive law."

-B.

On Mar 21, 2017, at 7:42 PM, Justin Levitt <levittj at lls.edu<mailto:levittj at lls.edu>> wrote:

And backing up still a few years more, the Illinois redistricting of 2001 is one of the reasons that Obama was, in 2003 and 2004, "extremely well connected in a number of Chicago and some national circles, so he had access to a network of individuals who could give at a high level."

State Senator Obama ran against incumbent Bobby Rush for Congress in the 2000 primary, and with a relatively hasty campaign against a sympathetic incumbent, won more than 30% of the vote.  When Illinois redrew its congressional districts, the block around Obama's home was sliced out of Bobby Rush's new district (as were the homes of all of Rush's other challengers in 2000: the map for the 2000 election is here<https://urldefense.proofpoint.com/v2/url?u=https-3A__www.google.com_maps_d_u_0_edit-3Fmid-3D1UmpxpqoBCGy8v-2Dr9RdE4-5FN9YSYk-26ie-3DUTF8-26hl-3Den-26msa-3D0-26ll-3D41.818236053356586-252C-2D87.58850100000001-26spn-3D0.102346-252C0.136642-26z-3D11&d=DwMD-g&c=XRWvQHnpdBDRh-yzrHjqLpXuHNC_9nanQc6pPG_SpT0&r=liAVgWK_6sjbUg6EC0f0khf6MyboEmFwaqEV2P3ukag&m=zI4MgdT1CUxtsmgxyV_wFRxmKhm286BaBSXvef7--es&s=1xX9urF3YCY67jzpJ-qsomaTqtRIMvMKADqR_jvywv4&e=>, and the map for the 2002 election is here<https://urldefense.proofpoint.com/v2/url?u=https-3A__www.google.com_maps_d_u_0_edit-3Fmid-3D1mYU3VrbNTONvC1oBKtP01RYsxUg-26ie-3DUTF8-26hl-3Den-26msa-3D0-26ll-3D41.818236053356586-252C-2D87.58850100000001-26spn-3D0.245745-252C0.617294-26z-3D11&d=DwMD-g&c=XRWvQHnpdBDRh-yzrHjqLpXuHNC_9nanQc6pPG_SpT0&r=liAVgWK_6sjbUg6EC0f0khf6MyboEmFwaqEV2P3ukag&m=zI4MgdT1CUxtsmgxyV_wFRxmKhm286BaBSXvef7--es&s=7vYoQFC6wYspPtCdh1gxDhS1JkwUn0AaGtIU6d8VCZY&e=>). The state Senate redrawing was considerably more kind to State Senator Obama: his district was substantially reconfigured to run through Chicago's Gold Coast, with a considerably wealthier donor base (the map for the 2000 election is here<https://urldefense.proofpoint.com/v2/url?u=https-3A__www.google.com_maps_d_u_0_edit-3Fmid-3D1ELAbj4u-5FbNQuRMZFVN7wVWqkwLk-26ie-3DUTF8-26hl-3Den-26msa-3D0-26spn-3D0.245745-252C0.617294-26ll-3D41.780569133234614-252C-2D87.62693200000001-26z-3D12&d=DwMD-g&c=XRWvQHnpdBDRh-yzrHjqLpXuHNC_9nanQc6pPG_SpT0&r=liAVgWK_6sjbUg6EC0f0khf6MyboEmFwaqEV2P3ukag&m=zI4MgdT1CUxtsmgxyV_wFRxmKhm286BaBSXvef7--es&s=HQ1_OOBOjD38fR9jLQ3sPOUBeOv8wgNoPbtvDerZZOc&e=>, and the map for the 2002 election is here<https://urldefense.proofpoint.com/v2/url?u=https-3A__www.google.com_maps_d_u_0_edit-3Fmid-3D13xoXfhWwIlaLkeAlbxh3Bs-2Du8a4-26ie-3DUTF8-26hl-3Den-26msa-3D0-26spn-3D0.245745-252C0.617294-26ll-3D41.81153846429898-252C-2D87.57654200000002-26z-3D11&d=DwMD-g&c=XRWvQHnpdBDRh-yzrHjqLpXuHNC_9nanQc6pPG_SpT0&r=liAVgWK_6sjbUg6EC0f0khf6MyboEmFwaqEV2P3ukag&m=zI4MgdT1CUxtsmgxyV_wFRxmKhm286BaBSXvef7--es&s=0rTtxABlFDcM7Z9LGxOZHqZk8NrekgMK2hUbqQjqzqQ&e=>).  That's another part of the reason (not the whole story, but a part) that Obama was poised to collect the bigger checks made possible by the Millionaire's Amendment.

Ryan Lizza<https://urldefense.proofpoint.com/v2/url?u=http-3A__www.newyorker.com_magazine_2008_07_21_making-2Dit&d=DwMD-g&c=XRWvQHnpdBDRh-yzrHjqLpXuHNC_9nanQc6pPG_SpT0&r=liAVgWK_6sjbUg6EC0f0khf6MyboEmFwaqEV2P3ukag&m=zI4MgdT1CUxtsmgxyV_wFRxmKhm286BaBSXvef7--es&s=ioGSZVqRS-imfMTOUybSvwkKIpZh_M09v1tR-gyo4Yc&e=> included this story in his deep dive on Obama's political background in 2008, and teed up by Sam Issacharoff, it also found its way into a 2010 documentary (from about 40:30 to 42:30 here<https://urldefense.proofpoint.com/v2/url?u=https-3A__www.youtube.com_watch-3Fv-3D-2D285T7Pdp58-26feature-3Dyoutu.be-26t-3D40m30s&d=DwMD-g&c=XRWvQHnpdBDRh-yzrHjqLpXuHNC_9nanQc6pPG_SpT0&r=liAVgWK_6sjbUg6EC0f0khf6MyboEmFwaqEV2P3ukag&m=zI4MgdT1CUxtsmgxyV_wFRxmKhm286BaBSXvef7--es&s=svvwUPZfMB-_8fkXkgHBhipJRp6WHBMf-nvIMX-_cFk&e=>).

--
Justin Levitt
Professor of Law
(on leave through spring 2017)
Loyola Law School | Los Angeles

On 3/21/2017 1:05 PM, Pildes, Rick wrote:
I know this is what everyone is thinking about right now, but for those of you who teach the Davis v. FEC case and this issue, there are some very fun facts I was not aware of in the article Kate Shaw just published in the Election Law Journal on this short-lived provision of BCRA (not sure I can link to the article).  Turns out a major beneficiary of this provision was an Illinois state senator named Barack Obama.  Here is Kate’s description:

The 2004 Illinois Senate race

When a one-term Illinois Republican senator named Peter Fitzgerald announced that he would not seek reelection in 2004, the Democrats sensed an opportunity to pick up a Senate seat.26<javascript:popRef('fn26')> A number of candidates entered the field, and two front-runners quickly emerged: Dan Hynes, the Illinois comptroller and scion of a local political family; and businessman Blair Hull, who in 1999 sold his trading business to Goldman Sachs for $531 million.27<javascript:popRef('fn27')> State senator and law professor Barack Obama, who had unsuccessfully run for Congress in 2000,28<javascript:popRef('fn28')> was one of a number of other candidates to enter the race.29<javascript:popRef('fn29')>

Hull made clear from early on that he intended to pour substantial sums of his own money into the race, pledging to spend up to $40 million.30<javascript:popRef('fn30')> In the end he spent $29 million of his own money, “an unprecedented sum for a Senate race in [Illinois],”31<javascript:popRef('fn31')> and at the time one of the top few Senate races ever in terms of personal expenditures.32<javascript:popRef('fn32')>

Recall that the Senate component of the Millionaire's Amendment entitled individuals running against the highest-spending self-funding candidates (and Hull's expenditures of his own money far exceeded the trigger) to accept contributions at six times the otherwise-applicable limits. This meant that in 2004, when the individual contribution limit was $2,000, opponents of self-funders could accept contributions up to $12,000.33<javascript:popRef('fn33')>

And Barack Obama, among others,34<javascript:popRef('fn34')> took full advantage of this provision. During just the primary campaign, Obama raised approximately $4.5 million; from the FEC records, it appears that just over $2 million came from 350 individual donors who gave at the elevated levels the Millionaire's Amendment allowed.35<javascript:popRef('fn35')> Without the increased limits, those donors would have been able to contribute only $700,000 in total—a difference of $1.3 million, or nearly a third of Obama's overall contributions in the primary.36<javascript:popRef('fn36')>

Hull's campaign ended up imploding, in part over domestic violence allegations substantiated by an order of protection his ex-wife had obtained;37<javascript:popRef('fn37')> once all of that came to light, the omnipresent advertisements and massive campaign staff enabled by his expenditures could not stop his slide. And by the time Hull's descent began, Obama was in a position to move into front-runner status. He ended up winning a decisive primary victory of 53%, with Dan Hynes in second at 24%, and Hull a distant third with 11%.38<javascript:popRef('fn38')>

I don't mean to make any sort of strong causal claim about the role of the Amendment in facilitating Obama's eventual victory.39<javascript:popRef('fn39')> But it does seem likely that the Amendment played some part. It was not a foregone conclusion that Obama would be the one to fill the gap left when Hull began to falter; at the time, most local politicos were betting on Hynes, whose name was well known and who had already won a statewide race. By contrast, Obama had never held national or even statewide office, though he'd been a state senator since 1996. But he was extremely well connected in a number of Chicago and some national circles, so he had access to a network of individuals who could give at a high level.40<javascript:popRef('fn40')> And this particular confluence of circumstances seems to have played some role in his eventual Senate victory—which positioned him, four years later, to win the presidency.

Best,
Rick

Richard H. Pildes
Sudler Family Professor of Constitutional Law
NYU School of Law
40 Washington Square South, NY, NY 10012
212 998-6377

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