Bundler’s Bungalow

“One of the biggest sources of political donations to Hillary Rodham Clinton is a tiny, lime-green bungalow that lies under the flight path from San Francisco International Airport.”  So begins a story yesterday from the Wall Street Journal, and we see come to life one of the Supreme Court’s three reasons for upholding ongoing reporting requirements for political committees: to gather the data necessary to detect violations of the contribution limitations.  The Journal fulfills its First Amendment role by putting disparate pieces of information together to raise questions of corruption for public and official consideration.  The Journal has another story on the matter in today’s edition.

The bungalow is the address of William and Alice Paw, Chinese immigrants of apparently modest means who vote “sporadically.”  The bungalow used to be the address of businessman, longtime Democratic donor, and “HillRaiser,” Norman Hsu.  The Paws’ political contributions have tracked Hsu’s since the Paws began making contributions in 2004.  Although, “[t]here is no public record or indication Mr. Hsu reimbursed the Paw family for their political contributions to the Clinton campaign,” Kent Cooper, of political money line, says, "There are red lights all over this one."

The red lights Cooper refers to illuminate possible campaign finance violations, such as exceeding contribution limits, and making contributions made in the name of another.

While we are generally for disclosure at CCP, we are often critical, and feel it is a remedy that gets out of hand.  Many want to extend disclosure to activities where disclosure could have no chance of exposing officeholder corruption, like to ballot initiative campaigns; or to keep the dollar-thresholds needlessly low to stop corruption, like at the federal threshold of $200.  We are also aware that there are costs associated with disclosure, including the chill on citizens’ contributions in an environment of public disclosure, as well as the opportunities for officeholders to use any system of disclosure for political retribution (think K Street project).

Here disclosure serves a meaningful role.  It gathers the information necessary to enforce existing law.

But Norman Hsu is a HillRaiser, a bundler engaged in an activity that reformers want to see disclosed in its own right.  (If Mr. Hsu were a federal lobbyist, he would make such disclosures next year under recent changes to federal ethics law).  The Journal’s articles show that ongoing reporting of contributions and reporting by the press are sufficient to detect possible violations of the contribution limits or to detect contributions made in the name of another.

Reformers do not argue that bundling disclosure would prevent coerced contributions.  They argue that a candidate is no less happy to see a bundler of several small contributions than she is to see one large contributor using his own money.  If true, logic would dictate no difference in whether Mr. Hsu used his own money to funnel contributions to the Clinton campaign or genuinely enlisted the support of the Paws, or others.  We can see, then — in the arguments of reform — not just a disdain for wealthy individuals, but a disdain for synergy, political dynamism, and volunteer activity in the area of campaign finance.  While not everyone has millions of dollars available for political donations, everyone can ask his acquaintances to get involved in politics or to contribute within legal limits.

The Center for Competitive Politics is now the Institute for Free Speech.