U.S. House: Reform Groups Press Ethics Committee to Resume Work on Unresolved Case of Rep. Maxine Waters
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Today, the Campaign Legal Center joined with a coalition of reform groups to urge the House ethics committee to resume its work on the pending investigation of Rep. Maxine Waters (D-CA) and provide the public with an accounting of the status of the case.
The case has been pending for more than two years and a scheduled hearing in November was abruptly cancelled without explanation.
The organizations signing the letter include the Campaign Legal Center, Common Cause, CREW, Democracy 21, League of Women Voters and Public Citizen.
The full letter follows below.
March 23, 2011
The Hon. Jo Bonner, Chairman
The Hon. Linda T. Sanchez, Ranking Member
House Committee on Ethics
U.S. House of Representatives
Washington, D.C. 20515
RE: Status of the Matter Regarding Rep. Maxine Waters
Dear House Committee on Ethics:
Our organizations – Campaign Legal Center, Citizens for Responsibility and Ethics in Washington, Common Cause, Democracy 21, League of Women Voters and Public Citizen – are concerned about the length of time it has taken the House Committee on Ethics to investigate and conclude the Matter Re: Representative Maxine Waters. We are writing to ask the Committee to inform us and the public when it plans to resume its work and adjudicate the case.
The investigation of Rep. Maxine Waters (D-Cal.) has been pending for approximately two years. The case involves allegations that the Waters and/or her staff in 2008 engaged in improper behavior that resulted in substantial financial gain for the Representative.
The Office of Congressional Ethics (OCE) began its investigation into the allegations on April 2, 2009, and recommended on August 6, 2009, that the Committee on Ethics further investigate the matter. The Committee on Ethics accepted the recommendations of OCE and set up an investigatory subcommittee on October 7, 2010, which on June 15 recommended an adjudicatory hearing. The Committee on Ethics agreed and scheduled a hearing to take place on November 29, 2010, which was suddenly cancelled without explanation by the Committee ten days prior to the hearing.
Recent news reports indicate that the Committee has no plans yet for resuming the investigation or adjudicatory hearing and concluding the matter.
These delays, followed by uncertainty whether any action is forthcoming, are unfair to all parties involved in the case and reflect poorly on the ability of the House Committee on Ethics to fulfill its mission.
We request that the committee inform us and the public about when the Committee is planning to resume its work on this case and when the Committee is anticipating completing its adjudication of this case.
Thank you for your attention to this matter.
Sincerely,
Campaign Legal Center
Citizens for Responsibility and Ethics in Washington
Common Cause
Democracy 21
League of Women Voters
Public Citizen
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White House: Reform Groups Urge President Obama to Fill 5 Expired FEC Slots with Commissioners Who Will Enforce the Law
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Today, the Campaign Legal Center joined with a coalition of reform groups to urge President Obama to move quickly to fill the expired commission slots at the Federal Election Commission (FEC) and end a “national campaign finance scandal” where the enforcement agency has refused to enforce campaign finance laws. The organizations asked the President to break from the longstanding but problematic practice of the White House simply nominating those individuals recommended by Senate leaders from each party.
By April 30, 2011, five of the six commissioners will be serving expired terms – some for as long as four years. By starting with a nearly clean slate President Obama has the opportunity to ensure that our nation’s campaign finance laws are actually enforced during the 2012 election cycle when unprecedented amounts of money are widely expected to be raised and spent.
The organizations include Americans for Campaign Reform, Campaign Legal Center, Common Cause, CREW, Democracy 21, League of Women Voters, Public Citizen and U.S. PIRG.
The full letter follows below.
March 15, 2011
The President
The White House
Washington, D.C. 20500
Dear Mr. President:
Our organizations are writing to express our grave concern about the dysfunctional Federal Election Commission which is spectacularly failing to meet its statutory responsibilities to administer and enforce the nation’s campaign finance laws.
The organizations include Americans for Campaign Reform, Campaign Legal Center, Common Cause, Citizens for Responsibility and Ethics in Washington (CREW), Democracy 21, League of Women Voters, Public Citizen and U.S. PIRG.
As a result of its failures, the FEC itself has become a national campaign finance scandal.
Solving this scandal, in the first instance, rests in your hands and in the statutory power you have to appoint FEC Commissioners.
As a 2009 Washington Post editorial explained about the FEC:
The commission was designed to have power shared equally between the two parties, so that neither would have the upper hand in taking potentially politically inspired action against the other. This unusual setup has often produced 3-3 splits between Republican and Democratic appointees. But those deadlocks have tended to arise sporadically, and in ideologically or politically charged cases, not in run-of-the-mill enforcement actions.
That's no longer true. The three Republican appointees are turning the commission into The Little Agency That Wouldn't: wouldn't launch investigations, wouldn't bring cases, wouldn't even accept settlements that the staff had already negotiated. This is not a matter of partisan politics. These commissioners simply appear not to believe in the law they have been entrusted with enforcing.
The FEC problems described in the Washington Post editorial in 2009 remain true today.
As of April 30, 2011, the terms of five of the six current FEC Commissioners will have expired and you will be in a position to nominate five new Commissioners for the agency. By statute, none of the five current Commissioners whose terms will have expired are eligible to be reappointed.
Our organizations urge you to expeditiously exercise your powers to nominate five new Commissioners to serve on the FEC and to give the Commission a new start. We also call on you to discard the past practice of allowing party leaders in Congress, in essence, to name the FEC Commissioners, the result of which all too often has been Commissioners who either serve partisan interests or are ideologically opposed to the laws.
We also request that you begin steps now to help ensure that five new Commissioners are in place as rapidly as possible, rather than allowing the current Commission to remain in place a day longer than is necessary.
Over the years, there have been serious failings at the FEC caused by both Democratic and Republican Commissioners.
However, nothing in the past history of the agency compares with the current situation in which three FEC Commissioners, Don McGahn, Matthew Petersen and Caroline Hunter, who are ideologically opposed to the campaign finance laws, have paralyzed the agency by consistently blocking enforcement of the laws and repeatedly misinterpreting the laws.
The actions of these Commissioners have turned the FEC into a rogue, non-functioning enforcement agency.
A St. Louis Post-Dispatch editorial last week aptly captured the current situation at the FEC in stating that there is “no doubt that the FEC is completely useless as a watchdog agency.”
Given the fact that the votes of three of the six FEC Commissioners can block any action by the agency, the regulated community has been given a blanket license to ignore the campaign finance laws. Everyone knows that as long as these three Commissioners remain on the FEC, the campaign finance laws can be violated at will and they will block enforcement actions.
This is a travesty for the American people who reasonably expect that laws that protect against government corruption will be vigorously enforced. It also is an outrageous abuse of office and an abdication of responsibility by the three Commissioners.
As an editorial in The New York Times last week stated:
The message to candidates entering the new era of unlimited big-money campaigning is clear. So long as the Republican members of the F.E.C. get their way, nobody’s minding the store and anything goes. …
With 2012 in sight, more, not less, reform is urgently needed. Five of the six F.E.C. seats come up for replacement next month. The Senate’s preference will be to confirm safe loyalists chosen by party bigwigs. President Obama can make a real difference if he breaks the tradition by selecting truly independent watchdogs as the two parties’ nominees — ones committed to enforcing the law — and fights for their confirmation.
Earlier this month, the dysfunctional state of the FEC was demonstrated once again.
According to a BNA Report (March 4, 2011), the FEC professional staff found through audits that the Kansas Republican party and a unit of Georgia Democratic party each had improperly used campaign funds.
Three Commissioners voted to support the FEC staff’s findings in both cases. The three obstructionist Commissioners, however, voted to reject the staff’s recommendations in both cases and thereby blocked findings that the Republican and Democratic Party committees each had committed campaign finance violations.
This is not an isolated instance. It is but one of numerous examples of a destructive pattern and practice on the part of the obstructionist Commissioners who have repeatedly blocked efforts by the FEC professional staff to enforce the campaign finance laws.
While the terms of five Commissioners will have expired as of April 30, 2011, and none of them are eligible for reappointment, all of these Commissioners will be able to remain on the Commission indefinitely until replacements are sworn in to take their seats.
Three of the FEC Commissioners are already in lame duck status as holdovers, including two whose terms expired nearly two years ago and one whose term expired nearly four years ago. The terms of two other Commissioners will expire on April 30 and, like the three lame duck Commissioners, they are not eligible for reappointment.
These circumstances provide a unique opportunity for you to nominate five new Commissioners and take steps to fundamentally change what is commonly recognized as the worst functioning government agency in Washington.
It is essential that you nominate new Commissioners based on merit, skills, qualifications, experience, background and professional reputation. It is also essential that the nominees have a basic commitment to enforcing the campaign finance laws as written by Congress and interpreted by the courts. Individuals who are ideologically opposed to the campaign finance laws must not be given the responsibility to enforce these laws.
One possible approach to nominating FEC Commissioners based on merit would be to establish a bipartisan advisory group of distinguished individuals who could find and recommend potential qualified nominees for each available seat on the Commission. This would be similar to the way that some Senators use outside advisory groups to surface the names of potential nominees for a judgeship.
You could then choose nominees based on these recommendations, in compliance, of course, with the statutory requirement that no more than three members of a political party can serve on the Commission at the same time.
We are well aware that in nominating FEC Commissioners based on merit and qualifications you would create a conflict with congressional leaders who are accustomed to choosing the Commissioners themselves.
Given the completely dysfunctional state of the FEC that has resulted from a business-as-usual appointments process, however, and given the enormous damage that has been done as a result to our campaign finance laws which protect against corruption, it is essential to end this national scandal by moving forward with a new approach to nominating Commissioners and with five nominees to fill the vacancies on the FEC.
If you proceed to nominate new Commissioners based on merit and qualifications, then it would be up to the Senate to address the FEC scandal. Each Senator would be faced with a clear choice: vote to confirm new FEC Commissioners selected on the basis of merit and qualifications or vote to take personal responsibility for perpetuating a scandal that is severely damaging the nation’s anti-corruption campaign finance laws.
We recognize that nominating new Commissioners may well lead to Senate filibusters against the nominees. If it does, that is a battle that must be fought.
The effort to remake the FEC and restore the integrity of our campaign finance laws cannot begin until you nominate new Commissioners. Our organizations strongly urge you to expeditiously nominate five new FEC Commissioners.
Thank you for your consideration of our views.
Respectfully,
Americans for Campaign Reform
Campaign Legal Center
Common Cause
CREW
Democracy 21
League of Women Voters
Public Citizen
U.S. PIRG
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How Presumed Presidential Candidates Skirt Contribution Limits & the FEC Turns a Blind Eye: Legal Center Releases White Paper
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Today the Campaign Legal Center released a white paper taking an in-depth look at the legal issues surrounding likely 2012 presidential candidates, who so far are calling themselves anything but that. The white paper looks at what the laws are, which ones are actually enforced, when the $2,500 limit contribution limits kick in and how state committees and federal leadership PACs are used to skirt that limit. Finally the paper makes recommendations about what can be done to close this long-existing loophole in federal campaign finance law.
The paper, They Claim They’re Not Ducks: Federal Campaign Finance Law and Presidential Pre-Candidacy Activity, was written by Campaign Legal Center FEC Program director Paul S. Ryan.
To read the full white paper, click here.
The executive summary follows below.
Executive Summary
For months, reporters have been writing about prospective presidential candidates raising and spending millions of dollars through a myriad of political organizations other than presidential campaign committees (e.g., 527 organizations, state PACs, federal leadership PACs), focusing their activities in early presidential caucus/primary states, and accepting contributions in amounts that far exceed the federal candidate $2,500 contribution limit and from sources, namely corporations, that are prohibited from making contributions to federal political committees. Remarkably, until March 3, 2011, not a single major player had admitted they were even “testing the waters” for a presidential run.
We have all heard the adage: “If it walks like a duck and quacks like a duck, you can be reasonably sure it is a duck.” Well these folks are walking like prospective candidates, talking like prospective candidates, but claiming they are not “testing the waters” of candidacy. They are in denial because if they admitted what is obvious to all, that they are “testing the waters,” they would be subject to a whole set of federal rules and restrictions that they want to avoid for as long as they can.
When do the federal law candidate contribution restrictions kick in? Federal law requires an individual who is “testing the waters” of a federal candidacy—i.e., spending money “for the purpose of determining whether [the] individual should become a candidate”—to pay for those activities with funds raised in compliance with the federal candidate contribution restrictions ($2,500 per individual donor, no corporate/union contributions).
Yet, for example, a political advisor to Mississippi Governor Haley Barbour has acknowledged that Barbour “is giving active consideration to running” for president, but Barbour is raising and spending funds through a Georgia PAC—funds that would be illegal under federal law (e.g., $25,000 corporate contributions)—to buy the Republican Party of Iowa’s voter list. Barbour is not alone. Mitt Romney has set up PACs in Iowa, New Hampshire, South Carolina, Michigan and Alabama and is spending millions on staff and consultants focused on early caucus/primary states. Other prospective Republican candidates, as well as prospective Democratic candidates in past election cycles, have done the same thing.
The notion that these individuals are not spending money for the purpose of determining whether they should become candidates strains credulity, yet they continue to ignore the federal candidate contribution restrictions applicable to such activities, which amounts to a refusal to acknowledge that they are “testing the waters” of a presidential campaign.
Why does this matter? For more than 100 years federal law has restricted contributions to candidates and the Supreme Court has consistently upheld such restrictions as vital to reducing the threat of corruption that results from unlimited contributions. Effective “testing the waters” regulations are crucial to protecting the integrity of elections by preventing prospective candidates from accepting potentially-corrupting unlimited contributions.
However, for decades prospective presidential candidates, both Democrats and Republicans alike, have skirted candidate contribution restrictions with an astoundingly high degree of success. Ronald Reagan opened the door to this abuse in 1977 with his “Citizens for the Republic” PAC, which he used to lay the foundation of his 1980 presidential campaign outside the candidate contribution restrictions. By the 1988 election cycle, virtually all serious contenders for the major parties’ presidential nominations were raising money outside the candidate contribution restrictions to fund their pre-candidacy activities, prompting one member of the FEC to write in dissent to Advisory Opinion 1986-6:
In its rulings on unannounced presidential aspirants the [FEC] has, step by step, gotten itself into the absurd position that it refuses to acknowledge what everyone knows: that Vice President Bush is running for President and is financing his campaign through the Fund for America’s Future, Inc., which he organized and controls. . . . Only persons just alighting from a UFO can doubt that activities of these sorts, which are engaged in over a period of many months, will promote the candidacy of the founding father. That, of course, is why so many would-be Presidents, of both parties, have created and utilized PACs of this sort in recent years.
In terms of enforcement, little has changed since 1986, but it is time for change. After detailing the activities of some of the most talked-about likely 2012 presidential candidates in Section I, putting these prospective candidate activities in historical context in Section II, and explaining the relevant federal laws and FEC guidance in Section III, this paper offers some ideas to close this long-existing loophole in federal campaign finance law in Section IV. Specifically, the Campaign Legal Center recommends:
1. More rigorous enforcement by the FEC of existing regulations requiring “testing the waters” activities to be paid for with funds raised under the $2,500 per election candidate contribution limit, subject to the ban on corporate and union contributions,
2. Amendment of an existing FEC regulation that creates a presumption that certain activities (e.g., setting up and staffing offices in states other than the candidate’s home state) by candidates participating in the public financing system constitute “testing the waters” of a presidential candidacy, to apply to all presidential candidates and any “person” paying the expenses covered by the current regulation, not just to federal leadership PACs covered by the current rule, and
3. Demand honesty from prospective candidates through pointed questions by journalists and voters. Likely 2012 presidential candidates should be asked, point blank, whether they are spending any money for the purpose of determining whether they should become candidates—i.e., “testing the waters.” If they deny that they are “testing the waters,” they should be asked why they are traveling repeatedly and often primarily to early caucus/primary states, buying voter lists in those states, staffing offices in those states, etc. Likely 2012 candidates should be required to explain their activities in a manner that passes the smell test. Just because the FEC may let abuse of the law slide, does not mean that voters and journalists have to. A little honesty is not too much to ask of those desiring to become our next president.
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