Money in Politics This Week

June 25, 2012 · by Sean Collins

Crossposted from the Brennan Center for Justice’s ReformNY blog.

1. At the close of the legislative session, faith leaders from across the religious spectrum came together to provide momentum for the campaign finance reform movement as it moves into the break between sessions. In a letter to Governor Cuomo and the state legislature that draws on lessons from the Old Testament, the New Testament, and the Qur’an, 56 religious leaders across the state urged Albany to enact reform legislation, which would use public financing to match small donations at a six-to-one ratio. “Our ancient traditions recognized the power of gifts to corrupt public officials and tip the scales of justice towards the wealthy and powerful,” the letter said, emphasizing that the problems with the status quo have long been evident. Next year’s legislative session provides another opportunity to fix this perennial problem.

2. Ethics issues continue to swirl around Michael Grimm, Staten Island’s representative to Congress. Less than a month ago, Grimm was cited for violating House ethics rules on fundraising. Now, the FBI and the U.S. Attorney’s office are investigating allegations that Grimm’s 2010 campaign pressured contributors to give more than the legal limit, according to a report the New York Daily News. Questions about how Grimm raised money for his first run for office arrive as he prepares to run for a second term this fall.

1. Unlimited spending is good, and non-disclosure is better—or so independent expenditure groups seemed to think in 2010. A recent study from the Center for Public Integrity and the Center for Responsive Politics reveals that 501(c)(4) groups spent roughly $95 million in the 2010 election, $30 million more than Super PACs that disclose their donors. 501(c)(4) groups are “social welfare” organizations that cannot have electing a candidate as a primary purpose. Many of the groups operate in a gray area between social welfare and politics, but so long as the IRS classifies a group as a 501(c)(4), it need not disclose its donors. While Super PACs have outspent 501(c)(4) groups in the current election cycle, more robust disclosure rules and enforcement of bans on coordinated expenditures are plainly needed for both types of organizations.

2. The FEC should act quickly on a petition from President Obama’s campaign that alleges a high-spending 501(c)(4) organization is required to disclose its donors. Last week, the Fourth Circuit Court of Appeals decided that a 501(c)(4) organization must disclose its donors if its “major purpose” is to elect a candidate for office. Whether or not the FEC agrees with the Obama campaign, it should issue a prompt decision to give teeth to the Fourth Circuit’s decision. A slow response will implicitly encourage 501(c)(4) groups to skirt the laws now, knowing consequences will come only after the November elections have passed and the damage has been done.

3. With the Supreme Court soon to decide whether to hear a case that could be the sequel to Citizens United, federal legislators are not content to leave reform in the hands of the nine justices.Proponents of the DISCLOSE Act are once again pushing the reform measure, which would “increase transparency in corporate donations to political action committees, allow shareholders to vote on whether a company should be spending money on politics and require CEOs to stand by ads if they are primary sponsors of the PACs running them.” Senator Sheldon Whitehouse, the lead sponsor of the Act, aims to bring the bill before the full Senate’s attention prior to the November elections.