FEC still hasn’t issued new campaign spending rules

March 25, 2011

A year after the Supreme Court made a landmark decision to ease campaign spending restrictions for corporations and interest groups, the Federal Election Commission has not issued regulations spelling out the full implications of the move.

The FEC increasingly has been paralyzed by a sometimes bitter standoff between Republicans and Democrats on the evenly divided panel. And although most of the commissioners will soon be serving in expired terms, President Obama and congressional Republicans have not been able to agree on replacements for them.

The court found in its Citizens United v. Federal Election Commission decision that the First Amendment allows unfettered spending on campaigns by corporations, nonprofits and unions. Shortly after the January 2010 ruling, the commission said it would no longer enforce regulations that the court had struck down directly.

But the effort to write new regulations has been halted by the partisan feud over how much interest groups must disclose about their financial backers.

Democratic commissioners are demanding that the FEC consider rules that would require interest groups to reveal who is underwriting campaign advertising. They point to the court ruling, saying eight of the nine justices favored public access to information about donors.

“We are not currently getting the kind of disclosure that the statute requires,” said Ellen Weintraub, one of the Democratic commissioners. “The trend is pretty clear: We’re seeing more spending, less disclosure.”

Republicans on the commission, however, are objecting, saying that only Congress has the authority to require disclosure, through legislation. At a meeting in January, the commission was unable to agree even on a notice to solicit public comment about which rules should be changed.

The stalemate has been worsened by the political rhetoric surrounding corporate spending on elections. Obama and congressional Democrats criticized the court’s decision and the practice among some interest groups of shielding their donors.

The disagreement over disclosure mirrors other FEC divisions over how vigorously to enforce campaign spending laws generally. The commissioners have faced partisan divides much more often than their predecessors did. According to the watchdog group Public Citizen, the FEC has deadlocked on one in seven cases during the past 21 / 2 years, compared with one in 50 cases in the five years prior.

The panel gridlocked last month, for example, when it could not agree on whether a negative message from the campaign of Rep. David Schweikert (R-Ariz.) about his opponent in the midterm election violated laws by not clearly identifying that he had paid for it.

The public “has a right to know who is responsible for such advertisements,” the three Democratic commissioners wrote, explaining their vote that the mailer was illegal.

Donald F. McGahn, a Republican commissioner, said he voted to dismiss the case because he had no problem finding the text identifying who paid for the mailer.

“Why are we singling out this guy when we have a mountain of precedent decided in a bipartisan way to let people get away with worse?” he said.

Advocates of tighter campaign spending rules are calling for Obama to appoint new commissioners. In May, five of the six commissioners will be serving in expired terms.

“The one area where [Obama] actually has some power to set the agenda is putting forward a set of nominees,” said Meredith McGehee of the Campaign Legal Center, which advocates for regulation of campaign funding. “He hasn’t taken any action.”

In a letter to the president last week, eight groups called for new appointments, saying the FEC is “a rogue, non-functioning enforcement agency.” The groups included Common Cause, Citizens for Responsibility and Ethics in Washington, Public Citizen and the League of Women Voters, all of which advocate for increased regulation of money in politics.

“We strongly support enforcement of our campaign finance laws,” said White House spokesman Reid Cherlin, “and we support addressing any weaknesses in the current system.”

By law, the FEC can have no more than three members from one party, and presidents have typically deferred to Senate leadership to pick nominees from the opposing party.

The letter calls for a “new approach” to nominations, with Obama choosing the nominees from both parties, although it acknowledged that such a system probably would result in a Republican challenge.

Also at issue in the Citizens United rulemaking is how strictly to interpret the court’s decision. The three Republican commissioners have said they think the decision may invalidate rules that bar corporations from raising money directly for candidates. Under that logic, corporations could hold fundraisers for candidates and deliver contributions from individuals as long as the candidates themselves weren’t involved in the activity.

The stricter interpretation has been that the court’s ruling allows corporations to spend from their general treasuries on campaign ads, but not to interact in any way with candidates or their campaigns.“Disclosure permits citizens and shareholders to react to speech of corporate entities in a proper way,” Justice Anthony Kennedy wrote in the majority opinion . “This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.”

The disclosure provisions proposed by commission Democrats closely resemble those in a bill pushed by congressional Democrats last year, which has prompted complaints from Republicans.

“Under our system of government, the legislative power is vested in Congress,” McGahn, the Republican commissioner, said in a January hearing on the issue. “It’s not the job of an unelected agency to decide it knows better.”

Democrats insist that current laws require more disclosure, which the court said in Citizens United was an important complement to the free speech protections given to corporations.

Staff writer Dan Eggen contributed to this report.

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