Spotlighting the Federal Election Commission's Efforts to Keep Political Spending in the Shadows
"[P]rompt disclosure of expenditures can provide shareholders and citizens with the information needed to hold corporations and elected officials accountable for their positions and supporters," the U.S. Supreme Court wrote in Citizens United v. Federal Election Commission. On March 30 – more than 26 months after Citizens United was decided – a federal judge struck down a Federal Election Commission (FEC) regulation that had been preventing disclosure.
Judge Amy Berman Jackson's decision is likely to be appealed – and, therefore, may not directly impact the 2012 elections. Nevertheless, the decision is a reminder that the FEC, like all other federal regulatory agencies, has an obligation to fulfill the will of Congress.
The Bipartisan Campaign Reform Act (BCRA), often called the "McCain-Feingold" law, required that every "person" who spends more than $10,000 per year on "electioneering communications" must disclose the name and address of any donor who contributed $1,000 or more. BCRA also prohibited most corporations and labor organizations from using corporate or treasury funds to make electioneering communications – a provision that was struck down in part in Wisconsin Right to Life v. FEC and entirely in Citizens United v. FEC.
Like other laws, BCRA only became effective when it was implemented by the relevant federal agency – in this case, the FEC. After Wisconsin Right to Life was decided in 2007, the FEC decided to rewrite its regulations to prevent what the agency believed to be an overly broad application of the disclosure rules found in BCRA.
Jackson wrote, "There is no question that the agency was animated by concerns that the disclosure provision might be too burdensome or too broad as a matter of policy when applied to all corporations and labor unions, as opposed to just [certain advocacy organizations] it covered before. In other words, the agency did not purport to be responding to a direct delegation of rulemaking authority or addressing an ambiguity inherent in the statutory scheme: it specifically undertook to modify existing law to fit the changed circumstances."
The FEC's post-Wisconsin Right to Life regulations are responsible for allowing vast amounts of political spending to evade disclosure. This became even more concerning after the Supreme Court's Citizens United decision relied so heavily on the theory that a robust disclosure system is adequate – and necessary – to prevent the appearance of corruption and allow voters to make informed decisions. According to Democracy 21, less than 10 percent of the $80 million spent on "electioneering communications" in the midterm elections was disclosed.
Even more important are the fundamental questions Jackson's opinion renews about the ability of the FEC to fulfill its core mission. Jackson's order, demanding that Congress's intent in BCRA be respected, is just a first step toward full disclosure of the influence of money in our electoral system.
The FEC has yet to successfully issue regulations that would implement the Citizens United decision. The agency has been stymied by ideological deadlocks that have prevented it from issuing even routine enforcement orders, let alone moving forward with such a significant regulatory initiative. Formed in the aftermath of the Watergate scandal to help prevent political corruption and illicit spending, the FEC now looks increasingly irrelevant and will require a significant overhaul in order to meet its basic obligations.
Observers like Citizens for Responsibility and Ethics in Washington, Democracy 21, and Common Cause have long been raising concerns about the ability of the FEC to function properly. In addition to concerns about whether the FEC has become a "captured" agency, they also point out that five of six commissioners' terms have expired, yet no one has been nominated to replace them.
With the fall elections now less than seven months away, it is clear that the FEC will not be able to move forward with new contribution or spending rules to address the onslaught of secret contributions and outside spending that plague modern political campaigns. Stopgap proposals that involve the Securities and Exchange Commission and the Federal Communications Commission in trying to increase disclosure are only partial solutions. Without fundamental reform, the FEC cannot achieve its mandate of assuring that our elections – and, in turn, our public officials – are free from corruption and undue influence by big-spending special interests.