An Independent Look at Campaign Finance Regulation

An Independent Look at Campaign Finance Regulation
Harry Kresky

Independents, now more than forty percent of the American electorate, are challenging the domination of our politics and government by the two major parties. They seek full participation and structural solutions to the hyper-partisanship in Washington and state capitals across the country. A series of recent federal court decisions reflect the progress that is being made to reposition “non-party” players who seek the right to compete effectively in the political process.

A legal milestone in the battle of “the people vs. the parties” was passed in 2008 when the U.S. Supreme Court upheld a voting system in the State of Washington that abolished party primaries. The partisan system was replaced with one where all voters participate in a first round open to all candidates, with the top two going on to a general election also open to all voters. Wash. State Grange v. Wash. State Republican Party 552 U.S. 442 (2008). That Supreme Court decision laid the foundation for a next step on the political front. California voters will go to the polls on June 8th in a referendum designed to bring that system to their state and give 3.4 million independents the right to vote in the election that determines which candidates will appear on the November ballot.

Independents are making legal headway in the area of campaign finance as well, in some cases by the courts rejecting some of the Watergate-era constraints on political spending. The attempts to restrain political giving as a means to prevent corruption and the aggregation of electoral power have proven to produce the opposite. Thus, restrictions on non-party players in the electoral arena have been loosened while the existing limits on contribution to and expenditures by party committees (as proxies for parties) have been maintained. While the courts have been strident allies of the two parties and the two party system (Justice Scalia once opined “Representative democracy … is unimaginable without the ability of citizens to band together in promoting among the electorate candidates who espouse their political views. The formation of national political parties was almost concurrent with the formation of the Republic itself,” California Democratic Party v. Jones, 530 U.S. 567, 574 (2000)), some decisions, described below, have weakened the relative position of the parties in the funding of candidates for public office. The beneficiaries, independents, corporations, labor unions are, in traditional terms, strange bedfellows. And, while these developments have brought hand wringing by pro-regulation liberals who support a campaign finance system designed to keep “big money,” out of politics, they create new opportunities to open up the political process and challenge the two-party monopoly.

In Citizens United v. Federal Election Commission, 130 S. Ct. 876 (2010), decided by the U.S. Supreme Court in early 2010, the Court ruled that the First Amendment bars limits on independent expenditures by corporations and labor unions in support of candidates for federal office. By increasing the leverage of non-party players, the ruling may well loosen the hold of the major parties on the electoral process. The dissenters, in fact, warned against this. 130 S. Ct. 940.

Independents are particularly encouraged by a March 2, 2010 ruling by the Court of Appeals for the D.C. Circuit that gives a significant leg up to those seeking to organize new approaches and new entities to compete with the parties in presidential politics. In Unity08 v. Federal Election Commission, 596 F.3d 861 (2010), the Court ruled that the Federal Election Commission (“FEC”) lacked jurisdiction to restrict Unity’s access to the funding needed. Unity08’s vision was to create a grassroots process to assemble a presidential ticket that drew from across the political spectrum, not a third party, but a “third way” to overcome the intense partisanship of the Beltway. Its hope was to organize a new online nominating process and secure a ballot line in all fifty states for an independent ticket for national office.

The FEC had tried to limit contributions to Unity to $5,000 per person on the grounds that it was a political committee supporting a candidate for federal office. In rejecting the FEC’s position, the Court’s decision drew a sharp distinction between Unity, an organization attempting to build a new vehicle for action in the electoral arena, and the existing parties. The Court implicitly recognized the need for new and independent players to raise large sums of money to offset the enormous advantage which the major parties have through control of the institutional machinery. This control dominates every aspect of the political process, from who sits on regulating bodies like the FEC to how candidates are nominated to how Congress and state legislatures are organized. For all of the outcry about how our government is broken, it is completely obvious that the current stakeholders will not reform a system that is engineered to their advantage. Unless “outsider” forces or forces which operate beyond the boundaries of party politics are empowered, there will be no way to fix a broken government or repair a damaged political process.

On another front, the national parties were quick to try to exploit the Supreme Court ruling in Citizens United for their own purposes. In Republican National Committee v. Federal Election Commission , 2010 U.S. Dist. LEXIS 29163, decided on March 26, 2010 by the U.S. District Court in Washington, D.C. the Court rejected the Republican Party’s effort to use Citizens United to overturn restrictions on contributions to it that are used to support candidates for public office, otherwise known as “soft money.” The Court noted that the “national party committees and the public officials who control them” were “inextricably intertwined.” (p. 13) In a decision handed down the same day, the Court of Appeals that decided the Unity08 case held that individuals can contribute unlimited amounts of money to non-party organizations making independent expenditures on behalf of candidates. v. Federal Election Commission, 2010 U.S. App. LEXIS 6254.

Unfortunately, the Obama administration has joined with those who decry these decisions and, in particular, the Citizens United ruling, as opening the door to big money domination of the political process. There are several points to be made here. First, the campaign finance system has neither leveled the electoral playing field nor taken “big” money out of politics. Obama himself opted out of the campaign finance system to raise $700 million because he recognized that his insurgent campaign needed as much money as it could get to challenge, first the Democratic Party, and then the Republican Party, establishments. Second, it has become apparent to millions of Americans, particularly to the 40 percent that self identify as independents, that the problem is not that there is too much money in politics, but that there are not enough mechanisms for the people to exercise the power to reform. Put another way, the parties too often stand in opposition to the interests of the people.

We must measure the corrupting influence of money against the need to raise and spend it to challenge existing two-party control. Every court that has looked at the matter has identified the major point of engagement as that between contributors (individual, corporate or union) and a candidate or the party of which he or she is a member. It is this iron triangle of party, candidate and moneyed interests that makes the American political system so hard to reform. Allowing players, including rich ones, from outside that iron triangle to spend to support political reform (including supporting candidates oriented towards reform) and new electoral initiatives is what independents seek in the campaign finance arena.

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