The disclosure of political spending has become a hot button issue as many of those seeking to buy influence and sway election results with million dollar checks would prefer to do it anonymously. The individuals and corporations writing the checks know they’re doing it and so do the politicians that benefit. Only the public is left in the dark in this equation and that is a serious threat to our democracy. The amount of misinformation out there about disclosure is staggering so the Legal Center has produced a primer on the topic to help separate the fact from the fiction.
Q: Why is disclosure of election-related fundraising and spending important?
A: Disclosure of money raised spent in elections has been the bedrock of our political system for many years, usually supported by all political parties. Voters deserve to know who is funding political communications in order to evaluate the full context of the message. Citizens need to know who has spent money to elect or defeat officials in order to hold those officeholders accountable and prevent corruption.
Justice Kennedy, in the only portion of last year’s Citizens United opinion that had the support of eight of the nine Justices, noted the importance of disclosing the sources of campaign spending. He wrote that disclosure “provide[s] the electorate with information,” makes sure “that voters are fully informed about the person or group who is speaking,” and ensures people are “able to evaluate the arguments to which they are being subjected.”
Justice Kennedy explained further: “The First Amendment protects political speech, and disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way. The transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.”He also went on to say: “With the advent of the internet, prompt disclosure of expenditures can provide shareholders and citizens with the information needed to hold corporations and elected officials accountable for their positions and supporters. Shareholders can determine whether their corporation’s political speech advances the corporation’s interest in making profits, and citizens can see whether elected officials are ‘in the pocket’ of so-called moneyed interests.”
Justice Kennedy presumed that disclosure would serve as a check on potential misuse of independent expenditures, saying “[i]f elected officials succumb to improper influences from independent expenditures; if they surrender their best judgment; and if they put expediency before principle, then surely there is cause for concern.”
Justice Scalia also made a forceful defense of election-related disclosure last year in a concurring opinion in Doe v. Reed. In that case, which upheld disclosure requirements for petition signers for ballot measures, Justice Scalia wrote: “Requiring people to stand up in public for their political acts fosters civic courage, without which democracy is doomed.”
Q: What do you mean when you say disclosure?
A: Disclosure means shining a light on the money that is raised and spent to influence our elections. It should be clear who is paying for a TV advertisement or a piece of mail and where their money comes from. Already, candidates for federal office have to file reports detailing how much money they raised, where it came from and what they spent it on. When they run an ad on TV or on the radio, the candidate has to personally state that they approved the message in the ad. Tens of millions of dollars were spent in 2010 on ads paid for by groups that reveal nothing about their donors. Far more of this undisclosed spending is anticipated in 2012.
Q: Why worry about disclosure? I thought most donations come from small donors.
A: Even in 2008, when more individuals donated to campaigns than ever before, only 12% of the money in congressional candidates’ coffers came from small donations from individuals. That figure represents only a fraction of the total money spent on federal elections. The floodgates that the Supreme Court opened inCitizens United allow unlimited corporate and union money to drown out the voices of individual donors like never before. And without robust disclosure laws, the powerful interests behind that money remain in the shadows. Some groups have admitted receiving donations of tens of millions of dollars from one source—and many other large donations to elect or defeat candidates through these “outside” groups are completely hidden.
Q: Does disclosure really provide voters with useful information?
A: Full disclosure of the money in politics provides voters with information that is critical to holding representatives accountable through elections. In order to make that accountability meaningful, voters need to know if their elected officials will answer to them or to corporations, unions and wealthy donors who pay for the advertisements that flood the airways. When special interest groups can spend large amounts of money while hidden in the shadows, it becomes easier for them to threaten political retribution to lawmakers who don't vote their way. Stronger disclosure laws will make clear the role that special interests play in our elections and will ensure that voters have all of the facts when they go to the polls.
It is also important for voters to know who is paying for the ads bombarding them, because voters will find some sources more “trustworthy” than others. Members of the NRA or the Brady Campaign to Prevent Gun Violence, or any citizen, will have different views about the reliability of an ad if they know that a pro- or anti-gun group paid for it. Ads about cigarette taxes may be seen as more or less reliable if you know they were paid for by tobacco companies or anti-smoking groups.
Q: I thought the Citizens United decision means corporations and labor unions can spend what they want on elections without disclosing where the money comes from.
A: No—in fact, Citizens United said the opposite. Eight Justices agreed that organizations attempting to influence our elections should be required to disclose their spending and contributors, and agreed that disclosure should include the funder of communications that discuss candidates in the midst of an election, and not merely those that expressly advocate for a candidate’s election or defeat.
Q: So if Congress passed landmark campaign finance legislation ten years ago, and the Supreme Court has upheld disclosure requirements by an 8-1 margin, why don’t we have effective disclosure now?
A: Simple—the Federal Election Commission (FEC) subverted the disclosure law that Congress wrote and that the Supreme Court upheld with a little-noticed “interpretation of law” that virtually gutted the its effectiveness. The McCain-Feingold campaign finance law passed by Congress and signed by President Bush in 2002 specified that disclosure is required of all persons who contributed $1000 or more to groups running “electioneering communications”—the ads that flood the airwaves in the weeks before an election. But the FEC’s interpretation required disclosure only of persons who contributed $1000 or more expressly “for the purpose of furthering electioneering communications.” The agency explained that disclosure is only required if the contribution is “specifically designated for [electioneering communications] by the donor.” In other words, a donor can evade disclosure simply by contributing to the organization for general purposes and refraining from designating their money for political ads.
Q: Why is it a problem if only contributions designated for election activity have to be disclosed? Wouldn’t that mean all contributions used to fund these new ads are reported?
A: Unfortunately, the FEC’s enforcement of its own “interpretation of law,” described above, has made it even easier for groups to keep the source of their campaign funds hidden in the shadows. Just a few months after the Supreme Court’s overwhelming affirmance of disclosure requirements in Citizens United, the FEC ignored the recommendation of its general counsel and dismissed a complaint that a group called “Freedom’s Watch” had violated the law when it spent more than $125,000 on a political ad without disclosing donors. In dismissing the complaint, the three Republican Commissioners narrowed the interpretation of the disclosure law even further—to require disclosure of contributions only if the donor specifies that their money should go to a particular ad. Since it is almost never the case that someone donates money to fund a specific ad—indeed, generally the ads are not created until after the money is raised—the FEC has neutered the disclosure law passed by Congress in 2002.
Q: What sort of secret spending is occurring?
A: Although candidates and some political organizations have to disclose information about their contributors and spending, many groups that work to influence elections do not. Corporations, unions, and non-profits can spend millions of dollars to support or oppose a candidate and the public will never know where that money is coming from. The newest and most troubling vehicles for this secret money are the new organizations with deliberately nondescript names like “Crossroads GPS” and “Priorities USA.” They accept unlimited amounts of money from business corporations, labor unions and the über-wealthy without ever disclosing their donors. The public has no way of knowing who really is spending money to influence their vote.
Q: Does disclosure violate the First Amendment?
A: Absolutely not. To the contrary, the Supreme Court has held that disclosure advances the public's First Amendment right to information. Disclosure empowers Americans to evaluate the people and organizations that are trying to influence their vote and to exercise that vote effectively.
Q: Some say that disclosure stifles free speech—is that true?
A: The Supreme Court has consistently upheld as constitutional candidate election-related disclosure laws, except where someone has shown specific evidence that disclosure of their name will result in threats, harassment or reprisals. As recently as Citizens United, the Court held that the challenged federal disclosure requirement did not “impose a chill on speech or expression.”
In the landmark 1976 case Buckley v. Valeo, the Supreme Court upheld blanket disclosure requirements and suggested that if contributors could give courts facts that show, for example, “specific evidence of past or present harassment,” or a “pattern of threats or specific manifestations of public hostility,” they might qualify for an exemption from disclosure requirements. But the Court has granted those exemptions when the facts of a case show that a speaker has been threatened with bodily harm. For example, in separate Supreme Court cases, the NAACP and theSocialist Workers Party were exempted from disclosure requirements after proving to the courts that their members would be subject to serious threats and bodily harm. The FEC has a similar procedure in place to exempt groups that can show that disclosure presents a personal risk.
Q: What about a right to anonymous speech?
A: There is no right to anonymous speech when an organization is trying to influence the outcome of a candidate's election. The Supreme Court has explicitly rejected “[t]he existence of a generalized right of anonymity in speech.” After all, as Justice Stevens wrote for the Supreme Court in City of Ladue v. Gilleo, “the identity of the speaker is an important component of many attempts to persuade.” In order for citizens to make informed choices when they go to the polls, they should know who has been trying to persuade them to vote one way or the other.
Q: Is campaign finance disclosure a partisan issue?
A: It should not be. Campaign finance reforms have historically passed with bipartisan support. Requiring disclosure of contributors to 527 organizations passed with overwhelming bipartisan support in 2000 when our elections were threatened with huge waves of secret spending. Current congressional leaders like Speaker John Boehner, House Majority Leader Eric Cantor and even Senate Majority Leader Mitch McConnell have in the past voiced their support for increased transparency and disclosure of political contributions. However, in the last Congress, the DISCLOSE Act became a partisan issue, with Republicans claiming they were kept out of the drafting and that the bill contained provisions that favored Democrats and unions. Democrats said they could not find Republican members willing to participate in drafting the bill.
Q: Why is support for disclosure so critical now?
A: We are at a unique moment in the relationship of money and politics. The FEC, created after the Watergate scandal and tasked with enforcing campaign finance laws, has become deadlocked and unable to perform its functions and ensure disclosure of money spent in federal elections. At the same time, the Citizens United decision has unleashed a torrent of unidentifiable but generously-funded spending on our elections. The opponents of disclosure have been emboldened by victories on other campaign finance issues and are launching an assault on the decades-old disclosure laws that safeguard our elections. The basic principle that voters should have the information they need to make an informed choice in the voting booth is under attack by wealthy special interests.
Additional Resources on Disclosure:
- Former FEC Chairman and CLC Founding President Trevor Potter discussed how the FEC obstructed development of the disclosure regime that Justice Kennedy promised in Citizens United.
- Though the contributions of enigmatic campaign groups remain obscured, a website called Open Secrets allows you to see where your representatives get their campaign contributions.
- CLC Policy Director Meredith McGee highlighted the importance of requiring that independent groups disclose their contributors and so provide voters with the information they need to evaluate television advertisements run acrossAmerica.
- The National Institute on Money and Politics reviewed the inadequacy of state laws on disclosing independent expenditures
 Statement of Reasons of Chairman Matthew S. Petersen and Commissioners Caroline C. Hunter and Donald F. McGahn, In the Matter of Freedom’s Watch, Inc., MUR 6002, Fed. Election Comm’n (Aug. 13, 2010).
 See Nat’l Ass’n for the Advancement of Colored People v. State of Ala. ex. rel. Patterson, 357 U.S. 449, 462-63 (1958); Brown v. Socialist Workers ’74 Campaign Comm. (Ohio), 459 U.S. 87, 93-100 (1982).