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Posts in "Campaign finance"
July 16, 2014
Jeb Hensarling, chairman of the House Financial Services panel, was in a rush to recess a lengthy markup so he and the other lawmakers could make it across the street to the Capitol for evening floor votes.
But Rep. David Scott, D-Ga., pleaded for a few seconds to squeeze in his comments before the gavel.
Even though Hensarling reconvened the markup just after those votes, Scott had somewhere else to be. “Thank you, because I have a fundraiser I’ve got to get to right after,” Scott said in a moment of candor that sent the room into surprised laughter.
Scott’s spokesman Michael Andel noted in an email that members are in town about 2.5 days per week. “That’s not a lot of time to do much of anything,” Andel said.
The episode on June 10 offered a rare glimpse into the reality that members of Congress of both parties face, especially in an election year: the constant tension between raising money to keep their jobs and actually doing their jobs.
The dash for cash is nothing new to elective office, but with the increasing costs of campaigns and the ever-bigger potential threats of outside money flooding into races, lawmakers over schedule their short work weeks in D.C. to hit up stakeholders and lobbyists from dawn until dark.
“There are only so many hours in a day, and when you have to spend an increasing amount of those asking people for cash, something has to give,” said Adam Smith, spokesman for Public Campaign, which advocates for public financing of elections. “And what gives, I think, is the job you’re elected to do.”
The Bipartisan Policy Center’s Commission on Political Reform recently released a report that seemed to conclude much the same. Led by ex-lawmakers-turned-K-Steeters such as Tom Daschle and Trent Lott, the commission’s June 24 report found members “spend too much time fundraising, which crowds out the time for legislating.”
“The commission decries the inordinate amount of time that members of Congress spend raising money and worry about the effects of such fundraising on the legislative process,” the report stated. “In particular, we fear that the need to raise ever-increasing amounts of campaign funds is crowding out the time that members have to engage in legislating and government oversight, the job they were sent to Washington to perform.”
The bipartisan group recommended Congress set up a task force styled after the 9/11 commission to make policy suggestions, and urged Congress to pass legislation requiring more disclosure of outside political money. The group also suggested Congress impose new restrictions on leadership political action committees, including limiting the funds to political, not personal, activities.
As much as lawmakers may complain, many of them privately, about the crush of pressure to raise money and the need to fork over donations to colleagues to help them advance in party or committee leadership in a sort of pay-to-play process, Congress seems to have little appetite to revamp the system — at least for now.
But the current way makes for a grueling schedule. House Republicans alone, for example, have 10 fundraisers scheduled on Wednesday, while House Democrats have at least five on the docket, according to party committee lists emailed among lobbyists. Senators also have several events on the docket.
That day, lobbyists and lawmakers can start things off with a breakfast at Bullfeathers benefiting Rep. Chris Gibson, R-N.Y. And they could end the day in a bipartisan way with a reception for Rep. Richard E. Neal, D-Mass., at Legal Seafoods in D.C.
To say nothing of the legislative work taking place on the Capitol campus.
Of course, the overbooked lawmakers and unpredictable congressional calendar can make life plenty difficult for lobbyists, too, who are trying to oblige members’ requests to hold fundraisers.
“Many of these events are scheduled weeks or months in advance, and you just don’t know what the voting or committee schedule will be like,” said Michael Herson, who runs American Defense International and hosts fundraisers. If an event is on the Hill, lawmakers usually can pop in, even briefly, between votes or committee meetings. But when the event is across town, the guest of honor may not make it at all.
But even the best of plans could be easily waylaid. “Votes could blow up the entire event,” Herson said.
Kate Ackley is a staff writer at CQ Roll Call who keeps tabs on the influence industry.
July 2, 2014
In its recent ruling to confer religious liberties on closely held corporations, the Supreme Court makes no mention of its 2010 Citizens United v. Federal Election Commission ruling.
Yet the high court’s Burwell v. Hobby Lobby Stores ruling grows directly out of its Citizens United decision to reject limits on independent corporate political spending. And the 5-4 Hobby Lobby ruling deepens the rift on Capitol Hill between liberals agitating for limits on corporate power and conservatives railing against government intrusions on free speech.
Senate Democrats have already scheduled a vote on a constitutional amendment that would give Congress and the states the power to restrict political spending. Such an amendment directly challenges both Citizens United and the court’s landmark Buckley v. Valeo ruling, which in 1976 upheld limits on campaign contributions but found caps on political spending unconstitutional.
The Hobby Lobby ruling has stoked liberal anger over the court’s expanding “corporate personhood” doctrine, which critics on the left argue threatens a host of environmental, civil rights and consumer safety laws. Now some Democrats on Capitol Hill are considering additional amendments that go beyond campaign financing to more explicitly spell out that corporations are not people. Full story
June 24, 2014
Senate Democrats broadened their assault on unrestricted political money Tuesday, introducing a campaign finance disclosure bill that its authors said will be voted on this year.
Senate Majority Leader Harry Reid had already promised a vote on a constitutional amendment that would let Congress and the states curb political spending. Democrats now plan to also vote on the disclosure bill known as the DISCLOSE Act, which Republicans blocked via filibuster in 2010 and 2012.
“Since the Supreme Court’s disastrous Citizens United decision, a torrent of dark money has swept through our political system, giving corporations and billionaires the ability to buy and sell elections,” said Sen. Sheldon Whitehouse, D-R.I., at a Capitol Hill news conference. Whitehouse was joined by Senate Rules Chairman Charles E. Schumer, D-N.Y., and by Democratic Sens. Michael Bennet of Colorado, Richard Blumenthal of Connecticut and Elizabeth Warren of Massachusetts.
Whitehouse’s reintroduction of the DISCLOSE Act coincides with a multi-pronged push by Democrats and their allies off Capitol Hill to score political points by attacking unrestricted, “secret” political money. Reid levels assaults virtually daily on the billionaire industrialists Charles and David Koch, who have helped underwrite tens of millions in political spending by conservative tax-exempt groups that don’t publicly report their donors.
Senate Democrats are also holding a series of hearings on undisclosed political money and on New Mexico Sen. Tom Udall’s proposal for a constitutional amendment, which would challenge a string of Supreme Court rulings, including the 2010 Citizens United v. FEC ruling to overturn limits on independent political spending.
Republicans have rejected Democrats’ proposed constitutional amendment as a blatant free speech violation, and have launched their own public relations campaign to equate campaign finance disclosure with political intimidation. Asked about allegations that disclosure invites harassment, Whitehouse scoffed that “someone who has the capacity to spend tens of millions of dollars in an election to get their way” need not be “worried about being taunted.”
But Democrats’ first version of the DISCLOSE Act, introduced in 2010, drew fire not just from conservatives but from liberal activists who complained that it would curb constitutionally protected lobbying activities. Democrats narrowed the bill considerably in 2012, and that more-limited version of the DISCLOSE Act was the one reintroduced today.
Asked about Democrats’ own unrestricted political spending Tuesday, Whitehouse said “everyone should follow as much transparency as possible,” but that Democrats can’t “unilaterally disarm.” He added that liberal outside spending might actually help spur GOP support for disclosure.
Democrats at the news conference displayed on a poster board a list of Republican senators who have endorsed disclosure in the past, including Sens. Lamar Alexander of Tennessee; John McCain of Arizona; Mitch McConnell of Kentucky, the Senate GOP leader; Lisa Murkowski of Alaska; and Jeff Sessions of Alabama. Whitehouse also quoted aloud several pro-transparency comments from Republicans, including McConnell.
But the likelihood that Democrats will win GOP support for either their constitutional amendment or the recently-reintroduced DISCLOSE Act remain virtually nil. Tuesday’s press conference came on the heels of yet another politically charged hearing in the GOP controlled House, at which Republicans continued their attacks on IRS officials for mishandling IRS attempts to curb political activities by non-disclosing tax-exempt groups.
June 3, 2014
The Senate’s Majority Leader, Harry Reid, and its GOP leader, Mitch McConnell, delivered sharply clashing views of the campaign finance system Tuesday, at a Senate hearing on a proposed constitutional amendment to allow Congress to restrict political money.
“I am here because the flood of dark money into our nation’s political system poses the greatest threat to our democracy that I have witnessed during my tenure in public service,” Reid said during testimony before the Senate Judiciary Committee. “The decisions by the Supreme Court have left the American people with a status quo in which one side’s billionaires are pitted against the other side’s billionaires.”
McConnell, a staunch and longtime opponent of campaign finance restrictions, countered that the Senate resolution on the table is “embarrassingly bad.” Amending the Constitution as proposed would not only “allow the government to favor certain speakers over others, it would guarantee such preferential treatment,” McConnell told the panel. “It contains a provision, not found in prior proposals, which expressly provides that Congress cannot ‘abridge the freedom of the press.’ That’s really great if you’re a corporation that owns a newspaper. It is not so great for everyone else. The media wins and everyone else loses.” Full story
May 28, 2014
House and Senate candidates are stockpiling campaign cash for the costliest midterms on record by making good use of the multi-politician war chests known as joint fundraising committees.
Since the Supreme Court’s April 2 McCutcheon v. Federal Election Commission ruling to overturn aggregate campaign contribution limits, 37 federal candidates have set up joint committees to raise campaign cash. The total number of joint fundraising accounts registered with the FEC now tops 450, according to the Center for Responsive Politics.
- Amid a $12 million ad blitz leveled by GOP outside groups, Sen. Kay Hagan, D-N.C., has helped launch no fewer than 17 joint committees that have collectively netted more than $1 million.
- Senate Minority Leader Mitch McConnell of Kentucky, whose race could attract as much as $100 million in spending, has a hand in four joint campaign accounts that have raised $3.4 million between them.
- More recently, Republicans created a new joint committee that will raise money collectively for 10 GOP House challengers and the National Republican Congressional Committee.
May 20, 2014
Candidates testing the waters of bitcoin fundraising are following different sets of rules as they go along, a function of both the freewheeling culture of the digital currency world and of mixed signals from the Federal Election Commission.
The FEC approved bitcoin fundraising in a unanimous advisory opinion on May 8, but the agency’s six commissioners immediately began a public dispute over what that decision actually means. At issue is whether digital currency contributions must be capped at $100 per election per donor, or whether candidates, political action committees and parties may accept the virtual currency in larger amounts.
The commission’s three Democrats maintain that they approved of bitcoin fundraising only to the $100 cap, and in a statement cited “serious concerns” about the potential difficulty verifying virtual transactions.
But the commission’s GOP chairman, Lee E. Goodman, countered in his own statement that bitcoins are in-kind donations, and must therefore be capped only at existing contribution limits — $2,600 for a candidate and $5,000 for a PAC per election. “Innovation and technology should not and will not stand idly by while the commission dithers,” he declared.
The upshot is that some political players say they’ll collect large, even unlimited, virtual contributions, and others will be capping bitcoins at $100. The political action committee known as Bit PAC, for one, will take donations well over $100, said its treasurer, GOP election lawyer Dan Backer. Bit PAC operates both a conventional PAC and an unrestricted super PAC, and will therefore take bitcoins donations up to $5,000 in one account, and unlimited virtual donations in another.
“The whole purpose of Bit PAC is to push the envelope” and “to move the ball on the full normalization of bitcoins in campaign finance,” Backer said in an interview with CQ Roll Call. Backer was the first to ask the FEC about bitcoin fundraising last fall. At that time, the commission deadlocked 3-3 and took no action.
By contrast, GOP House candidate Paul Dietzel, a technology entrepreneur running for an open seat in Louisiana’s 6th District, will cap his bitcoin contributions at $100, “just to stay safe.” Dietzel, a free market conservative, posted a neon yellow “Donate Now With Bitcoins!” banner on his website as soon as the FEC issued its May 8 opinion — even though, as Dietzel put it, “it’s still slightly unclear” exactly how bitcoin fundraising will play out.
Rep. Jared Polis, D-Colo., also lost no time collecting bitcoins, and like Dietzel, he will be capping contributions at $100. Other federal candidates accepting bitcoins include Libertarian Jim Fulner, who’s running for Senate in Michigan, and Blaine Richardson, who’s running as an independent in Maine’s 2nd District.
Rep. Steve Stockman, R-Texas, who lost his primary challenge to Sen. John Cornyn in March, was one of several candidates who accepted bitcoins prior to the FEC’s approval. Other bitcoin pioneers include the national Libertarian Party; Darryl W. Perry, a fringe presidential candidate from Alabama; and eight state legislative candidates in California, Maine, Michigan, New Hampshire and Texas.
“The doors are opening instead of closing for the use of bitcoin in order to support candidates,” said Sinclair Skinner, treasurer of the 1911 United Political Action Committee, the first super PAC to accept bitcoins. Skinner called the FEC’s move a “positive step forward in using crypto currency in America.”
“The important thing here is that the FEC actually agreed on the process,” concurred David Mitrani, an associate at Sandler Reiff Lamb Rosenstein and Birkenstock. But Mitrani acknowledged that the FEC’s frequent internal disputes can leave things hazy for political players: “When the commission votes 3-3, what does it mean?”
Goodman downplayed the FEC’s clash over bitcoins, saying it was “like a lot of other areas where there appears to be some philosophical disagreement, or policy disagreement among commissioners.” But Democratic Commissioner Ellen L. Weintraub didn’t mince words: “I think our ability to provide clear guidance is undermined when commissioners take an advisory opinion and say it means something other than what it does.”
Election law blogger Rick Hasen, who teaches law at the University of California, Irvine, summed it up on the day the dispute erupted: “You can bet your bottom bitcoin that Democratic and Republican Commissioners will continue to clash on just about anything controversial coming before the Commission.”
May 8, 2014
The Federal Election Commission has unanimously ruled to permit the use of bitcoins for political contributions, a move that lends legitimacy to the virtual currency but leaves unclear how valuable or useful bitcoins will prove to be in elections.
The commission approved bitcoin campaign contributions 6-0 Thursday in response to an advisory opinion request from the Make Your Laws PAC, which promotes direct citizen participation in the legislative process. The FEC had deadlocked on a previous, similar request submitted last year. Full story
April 30, 2014
Federal Election Commission Vice Chairwoman Ann Ravel went to Capitol Hill on Wednesday to testify about undisclosed political money in California, but she ended up answering questions about an FEC employee’s violation of the Hatch Act.
Shortly before the Senate Rules Committee’s hearing Wednesday morning on campaign finance disclosure problems, the federal Office of Special Counsel announced that an unnamed FEC lawyer had resigned after admitting to Hatch Act violations. The Hatch Act bars federal employees from political activity in the government workplace.
Sen. Pat Roberts of Kansas, the Rules panel’s ranking Republican, zeroed in on the resignation following Ravel’s testimony. Ravel attended the hearing not in her capacity as an FEC commissioner, but as the former chairwoman of California’s Fair Political Practices Commission, which last year fined two tax-exempt groups a record $1 million for violating that state’s public disclosure laws. Full story
April 29, 2014
In the Supreme Court’s recent McCutcheon v. Federal Election Commission ruling to strike aggregate campaign contribution limits, Chief Justice John G. Roberts Jr. took the unusual step of proscribing how Congress might react.
Congress has “multiple alternatives available” to prevent unlimited contributions from making their way directly to candidates, Roberts wrote in his plurality opinion. These include “targeted restrictions on transfers among candidates and political committees,” the chief justice suggested helpfully, or creating “separate, nontransferable accounts” spent “only by their recipients.”
No one actually expects this polarized Congress, which can barely agree on a federal budget, to suddenly wade back into the thorny thicket of campaign finance changes. But the McCutcheon ruling may dramatically impact political fundraising and invites several basic legislative fixes, concludes a recent Congressional Research Service report. Full story
April 20, 2014
White House officials like to trumpet Organizing for Action as a “grass-roots-funded organization,” but the six-figure donors to President Barack Obama’s tax-exempt advocacy group keep adding up, and it just snagged its first million-dollar contributor.
Hedge fund founder and biotechnology entrepreneur David Shaw became the first OFA donor to clear $1 million, thanks to his $500,000 contribution to the organization in the first quarter of this year. Other top donors include author and philanthropist Amy Goldman Fowler, who’s given $750,000 since OFA’s inception in January of last year, and Fred Eychaner, president of News Web Corp., who gave $500,000 to help get the group off the ground.
More than half of OFA’s $32 million in receipts so far still come from small donors of $250 or less. In this quarter, OFA collected $5.9 million from 124,000 donors and the average contribution was $38.68, officials announced. Still, close to two dozen high-dollar donors have now given $100,000 or more. The top 10 donors have contributed $3.9 million collectively so far.
This inner circle includes such top Obama presidential campaign bundlers as Eychaner and Shaw, along with Wall Street investors, CEOs and executives in the real estate, entertainment, pharmaceutical and insurance industries. Ten donors have given $200,000 or more, including California philanthropist John Goldman; Utah venture capitalist Ryan Smith; New York City philanthropist and composer Philip Munger, and investor Mark Gallogly.
Obama administration officials have rejected suggestions that six-figure donors enjoy special access to the White House, and have ignored calls from watchdogs that Obama shut the group down.
As a tax-exempt advocacy group barred from spending most of its money on politics, OFA has also ignored complaints from congressional Democrats that it’s sitting out elections. The group has focused instead on the president’s policy agenda, including promoting enrollment in the Affordable Care Act, and advocating for immigration and gun safety legislation.
OFA takes no lobbyist or corporate money and voluntarily discloses donors of $250 or more every quarter. Shaw, OFA’s first million-dollar contributor, is worth $3.5 billion, according to Forbes magazine, and has served on the President’s Council of Advisors on Science and Technology under both Bill Clinton and Obama. OFA’s top 10 donors are:
- David Shaw, co-founder D.E. Shaw: $1 million
- Amy Goldman Fowler, New York author and philanthropist: $750,000
- Fred Eychaner, president, News Web Corp., Chicago, Ill.: $500,000
- Ryan Smith, Salt Lake City, Utah, venture capitalist: $351,260
- Philip Munger, New York City philanthropist: $250,000
- John Goldman, Atherton, Calif., philanthropist: $225,000
- Mark Gallogly, co-founder, Centerbridge Partners: $200,000
- Kenneth Levine, senior vice president, McAfee: $200,000
- Olan Mills II, chairman emeritus, Olan Mills, Inc.: $200,000
- Jon Stryker, New York City architect, philanthropist: $200,000
April 5, 2014
The chattering classes (no insult intended) are scrambling to come up with a snappy moniker for the joint fundraising committees that may emerge as political power centers in the wake of the Supreme Court’s recent McCutcheon v. Federal Election Commission ruling.
First, the Huffington Post’s Paul Blumenthal alerted readers that the McCutcheon ruling, which struck the aggregate campaign contribution limit, would force them to learn all about these until-now obscure joint committees. The headline said it all: “Figured Out Dark Money Groups, Super PACs? Thanks to the Supreme Court, You’ll Have to Learn About This, Too.”
Next, The Washington Post’s Matea Gold challenged readers of “The Fix” blog to come up with “some pithy names” to describe joint fundraising committees, as well as the turgidly-named “outside groups” that play such a big role in campaigns these days. Gold launched the contest on Twitter, and will announce the winners next week.
So what are joint fundraising committees, and what should they be called? Election lawyer Robert Kelner, who chairs Covington & Burling’s election law and political practice group, has already got his answer: “super joint fundraising committees” or “super JFCs” for short. In a statement on the day of the ruling, Kelner predicted: “We expect to see the emergence of so-called super joint fundraising committees (JFCs) involving many candidates to which a donor could write a single very large check.” Full story
April 2, 2014
Republican National Committee Chairman Reince Priebus could hardly contain his glee during a conference call with reporters shortly after the Supreme Court ruled to strike the aggregate limit on campaign contributions.
“We are excited about the outcome of this case,” exulted Priebus, noting that the RNC bankrolled the constitutional challenge brought by businessman Shaun McCutcheon from beginning to end. In McCutcheon v. FEC, the court ruled 5-4 to overturn the overall limit on what an individual may donate collectively to parties, candidates and PACs in one election cycle, which was capped at $123,200 total.
The ruling “allows us to go to our donors and say: Look instead of being able to give to only nine Senate candidates, you can now give to the 14 that are most in play,” Priebus told reporters. “And you can give to the Senate committee, the congressional committee and the RNC, and you can max out to all three.”
Priebus wasn’t the only party official rejoicing in the wake of the high court’s Wednesday ruling. One Democratic campaign committee operative confided that he was “happy as a pig in shit.” While advocates of campaign finance limits on and off Capitol Hill assailed the ruling as an invitation to corruption and campaign finance abuses, party officials welcomed the decision. Full story
Updated, 11:45 a.m. | In a long-awaited ruling in the case known as McCutcheon v. Federal Election Commission, the Supreme Court today struck the aggregate limit on campaign contributions as an unconstitutional infringement on free speech.
Significantly, the high court left in place the base limit on how much individuals and political action committees may give to candidates and political parties. But today’s ruling makes a challenge to that direct contribution limit, which stands at $2,600 per election for an individual, all but inevitable in the near future.
What the court overturned today was the overall limit on the amount that one individual may give to candidates, parties and PACs in a two-year election cycle, a cap that now stands at $123,000. Republican businessman Shaun McCutcheon had challenged the aggregate limit on the grounds that giving the same amount to a larger number of candidates would not invite corruption. Full story
April 1, 2014
New Jersey Gov. Chris Christie may manage to put the George Washington Bridge scandal behind him, but even if he does, his ethics troubles won’t be over.
Christie’s complicated relationship with campaign contributors and state contractors, in particular, will draw scrutiny as he continues to mull a 2016 presidential bid. Christie’s donors have a history of gravitating to secretive and little-regulated political groups to promote the GOP governor and his agenda.
These include tax-exempt organizations that spent millions on Christie’s gubernatorial election and re-election campaigns, and that operate outside the disclosure rules. Political activity by nonprofits has become commonplace these days, and Christie’s opponents run their own non-disclosing tax exempt groups.
But Christie’s big backers, who have bankrolled several pro-Christie operations, stand out because many of them are state contractors otherwise barred from contributing to his campaign. New Jersey “pay-to-play” laws, considered the strictest in the nation, bar large state contractors, utilities and financial services firms that manage state pension funds from donating to state candidates.
Yet a long list of New Jersey contractors and pension fund managers have given generously to groups that either back or are closely linked with Christie. Such contributions have repeatedly raised questions as to whether Christie supporters are skirting the state’s pay-to-play laws — a suggestion that the state Treasury Department, which enforces those statutes, has rejected.
March 25, 2014
Updated, 5:20 p.m. | Republican leaders are stepping up their campaign to discredit tea party activists who are challenging them on Capitol Hill and on the campaign trail, accusing conservatives of lining their own pockets at the expense of the GOP.
A recent radio ad for Senate Minority Leader Mitch McConnell, R-Ky. — who is under attack from the right in his own primary — blasts the Senate Conservatives Fund for spending its money “on a luxury townhouse with a wine cellar and hot tub in Washington, D.C.” House Republicans joke privately about the “conservative-industrial complex.” Even Ann Coulter has warned of “con men and scamsters” infiltrating the tea party movement.
Such claims hold more water for some groups than others in a movement with no clear leader. The tea party, loosely defined, is scattered among more than a dozen multimillion-dollar organizations, from the Club for Growth to FreedomWorks, to the Tea Party Express and the conservative startup Madison Fund, all with different bottom lines and spending patterns.
Some of the groups that have come in for the most criticism, such as the Senate Conservatives Fund — which calls the McConnell radio ad inaccurate — actually do spend most of their money on candidates. Others, such as the Tea Party Patriots Citizens Fund, have spent exactly zero in this election cycle on candidates, even as they raise millions from low-dollar donors.
Whatever their overhead, tea-party-aligned groups are spending tens of millions collectively, sometimes with little or no board oversight. Such groups tend to operate multiple fundraising entities, simultaneously pulling in checks for a 501(c)(3) charity, a 501(c)(4) advocacy group, a conventional political action committee subject to contribution limits and an unrestricted super PAC. Public records filed with the IRS and the Federal Election Commission revealed some unusual expenditures.