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Legacy Content / RULES OF THE GAME

Campaign Finance Fight Moves To Disclosure

The Supreme Court Could Decide How Much Secrecy Is Too Much

May 3, 2010

Disclosure has become ground zero in the campaign finance wars now that the Supreme Court has lifted restrictions on political spending by corporations, unions and activist groups.

The intensifying debate has raised questions that to go the heart of American political engagement. How much secrecy is too much? How much transparency treads on privacy and free speech?

The Supreme Court tackled these questions head-on last week in its oral argument over Doe v. Reed, a closely watched challenge to Washington state's ballot initiative reporting rules. Citing fears of harassment, anti-gay-marriage activists sued to block the release of 138,000 signatures on a petition to place the state's new same-sex marriage law on the ballot for a referendum.


In a lively and pointed argument, many on the high court appeared to suggest that keeping such names private would be hard to justify. Indiana lawyer James Bopp Jr., a leading free speech champion who's recently targeted disclosure rules in lower-court challenges around the country, faced particularly sharp questioning from Justices Anthony Kennedy and Antonin Scalia.

Both had ruled to lift corporate spending limits in the court's landmark Citizens United v. Federal Election Commission ruling earlier this year, but they appeared to suggest in Doe v. Reed that disclosure rules should stand pat. The Citizens United ruling drew a similar line, rolling back political spending regulations but rejecting a challenge to existing disclosure laws.

"You know, you can't run a democracy this way, with everybody being afraid of having his political positions known," Scalia scolded Bopp. In a comment that seemed to capture reform advocates' growing alarm over Bopp's state-level disclosure challenges, and the sweeping precedent they may set, Scalia also observed: "You are asking us to enter into a whole new field where we have never gone before."

But if Doe v. Reed asks for too little disclosure, some critics argue that reform advocates on Capitol Hill are asking for too much. As expected, Sen. Charles Schumer, D-N.Y., and Rep. Chris Van Hollen, D-Md., unveiled legislation last week responding to Citizens United. The companion bills set out to block newly freed-up corporations, unions and advocacy groups from hiding their political expenditures behind secretive shell organizations.

"We believe that voters have an absolute right to know who is spending money to influence their vote," Van Hollen said at an April 29 press conference to unveil the bill, which is known as DISCLOSE -- the Democracy is Strengthened by Casting Light on Spending in Elections Act. He added: "Nobody should be afraid of this transparency unless they have something to hide."

The bill also imposes new limits on government contractors and bailout money recipients, and on companies with 20 percent foreign ownership. But its centerpiece is an elaborate new disclosure regime that requires corporations and other spenders to run disclaimers identifying themselves in political ads, and to report their top donor or donors. Politically active groups may also set up "campaign-related activity" accounts subject to more comprehensive reporting.

"It's going to be difficult to argue that the law is unconstitutional, particularly in light of the Citizens United decision," said Tara Malloy, associate counsel at the Campaign Legal Center.

President Obama released a statement commending the legislation the day it was introduced, and its backers predict a big assist from the White House.

"I expect the administration to weigh in very heavily on this effort," said Democracy 21 President Fred Wertheimer. Though unions and some progressive advocacy groups had voiced reservations during the drafting process, the AFL-CIO also released a statement of support last week.

But critics signaled that the bill, if approved, would almost certainly face a court challenge. The Center for Competitive Politics assailed what it called "draconian" disclosure requirements for donors to organizations that engage in independent expenditures.

The bill's "whole purpose is to discourage corporations from doing what the court has ruled the First Amendment allows them to do," said Bopp in an interview. Bopp is representing anti-gay-marriage activists in California, Maine and Washington state in lawsuits that challenge disclosure laws requiring the names of ballot committee donors.

Reform advocates warn that Bopp is on a deliberate crusade to roll back the disclosure rules, not just for ballot initiatives but across the board. Bopp is also leading state-based challenges to reporting requirements for political messages that do not include express advocacy -- that is, explicit calls to vote for or against a particular candidate.

Bopp said that such fears are overblown, and that he actually endorses disclosure for donors to PACs, political parties and candidates. But a lower court in Montana recently upheld a Bopp-led challenge to state ballot committee disclosure rules, on the grounds that the threshold for reporting contributions was too low. It's only one of many disclosure disputes that lawmakers and regulators must now settle.

"Given the Citizens United decision, there is going to be renewed interest in disclosure," noted Malloy. "And this is going to be the new front lines in campaign finance and First Amendment cases."

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