Daily Media Links 7/29: The SEC’s twisty argument to toss pay-to-play muni bond rule challenge, Campaign funding legislation left languishing, and more…

In the News

Bloomberg BNA: D.C. Circuit to Hear Challenge to Contribution Limits

Kenneth P. Doyle

The case set for en banc argument involves a challenge to campaign contribution rules brought by a married couple, Laura Holmes and Paul Jost. They argued that having separate contribution limits for primary and general elections is unfair and unconstitutional because it advantages some candidates—often including incumbents—who face no primary challenge. Under current FEC rules, such candidates can use primary contributions to fund a general election race.

Holmes and Jost are being represented in the case by the nonprofit Center for Competitive Politics, a critic of campaign finance regulation.

Attorneys for the FEC have argued that the Supreme Court has consistently upheld the constitutionality of campaign contribution limits, including separate limits for primary and general elections. However, the D.C. Circuit panel ruling in April said it was not “frivolous” to challenge such contribution limits.

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IRS

Fox News: Documents indicate IRS officials knew of Tea Party targeting since 2011

A new batch of FBI documents released Thursday by Judicial Watch indicates that several senior Internal Revenue Service (IRS) officials were aware of the targeting of conservative groups almost two years before they told Congress.

Lois Lerner, who oversaw tax-exempt groups for the IRS, and top IRS official Holly Paz “knew that agents were targeting conservative groups for special scrutiny as early as 2011,” the conservative legal advocacy group said in a release Thursday..

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Independent Groups

CNN: Major Republican super PAC goes quiet

Theodore Schleifer

The lack of activity is another reminder that national Republican outside groups are ditching their plans to spend big on taking back the White House given their controversial nominee.

Two major donor networks — one organized by Charles and David Koch, and Karl Rove’s Crossroads groups — are currently sitting out of the presidential race and focusing their dollars on Senate battles.

Several of Future 45’s original bankrollers are prominent Trump critics who have pulled all of their money from efforts to support the presidential ticket. Singer, who cut one of the original checks to the group and is the most prolific bundler in Republican politics, poured millions into defeating Trump during the primary and is now declining to endorse him in the general. Griffin, too, has so far declined to endorse Trump.

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Conventions

Huffington Post: Democratic Donors Gripe That Clinton Foundation Giving Isn’t Buying DNC Access

Ryan Grim

High-dollar Democratic donors are frustrated their gifts to the Bill, Hillary and Chelsea Clinton Foundation haven’t bought better access at the Democratic National Convention, according to Democratic fundraisers here.

The issue isn’t necessarily about access to policymakers for the purpose of pressing a particular regulatory or legislative agenda. Instead, it’s about admittance to exclusive events, where high-rollers can see and be seen hobnobbing with celebrities and other millionaires.

Convention events come with a price tag, and can cost more than $50,000 to get into. But that’s just campaign money. Some donors are annoyed their charitable contributions to the Clinton Foundation aren’t being taken into account.

“They want it included in their tally, and Dennis is saying no,” said one fundraiser, referring to Dennis Cheng, one of the most powerful if low-profile managers at the convention.

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Free Speech

Wall Street Journal: Judge: First Amendment Protects Political Robocalls

Jacob Gershman

Political robocalls may be an irritating feature of modern campaigning, but that doesn’t mean they don’t deserve protection under the First Amendment, a federal judge ruled.

A decision handed down Wednesday in Arkansas federal court struck down a state law passed 35 years ago that banned political robocalls. The statute restricted commercial robocalling and also made it unlawful to solicit information “in connection with a political campaign” using an automated phone system for dialing numbers and playing recorded messages.

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DNC Emails

ABC News: DNC Still Assessing Hack Damage, Hasn’t Notified Donors of Breach

Matthew Mosk, Brian Ross and Rhonda Schwartz

The Democratic National Committee has yet to notify thousands of wealthy donors whose email addresses and other personal information have been exposed by a pernicious cyberintrusion, including Hollywood stars, CEOs and some of America’s superrich.

“It’s very disturbing,” said Georgia trial lawyer Mark Tate, who has donated tens of thousands of dollars to the Democratic Party and its candidates. “They haven’t told me that my information is out there.”

But out there it is, along with thousands of donor files — many of them listed on a massive spreadsheet the party called the “Big Spreadsheet of All Things,” which appears to list data about every check written to the party, Hillary Clinton and President Barack Obama going back to 2013. The file includes email addresses, phone numbers and in some cases additional personal information not publicly available on FEC reports. Under FEC rules, contributors are required to reveal the amounts of their gifts and provide a mailing address but not email or phone information.

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Foreign Contributions

The Hill: A Putin SuperPAC?

Matt Strabone

Recent revelations have led some commentators to conclude that President Vladimir Putin of Russia might be taking more than an observer’s interest in the 2016 presidential election. Certain public statements certainly point to Putin viewing the candidacy of Donald J. Trump very favorably. While any alleged assistance to the Trump campaign on the part of the Kremlin or its resident has been the stuff of spy stories and foreign nationals are, of course, prohibited from providing financial support to campaigns for U. S. federal office, there are serious loopholes in campaign finance law that make very real the threat of Russian intervention in our democratic process.

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Daily Mail: Billionaire accused of being front for Chinese Communist bid to influence Bill’s 1996 election finally faces being questioned after years on the run

Alana Goodman

According to congressional investigators, Ng laundered the illegal campaign donations through a close Clinton associate in Arkansas named Charlie Trie during the 1996 election.

Trie, who sent the donations to the Democratic National Committee and Clinton’s legal defense fund, pleaded guilty to violating campaign finance laws in 1999.

The House Oversight Committee said it will take the opportunity to finally question Ng about the foreign donation scheme now that he is under house detention at a $3 million Manhattan apartment, awaiting trial on separate charges that he tried to bribe a top UN official.

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SEC

Reuters: The SEC’s twisty argument to toss pay-to-play muni bond rule challenge

Alison Frankel

The agency hasn’t shown much eagerness to do so, but in the Appropriations Act of 2016 (which was actually passed in December 2015), the House and Senate seemed to take the issue out of the SEC’s control. The law barred the commission from using SEC funds to “finalize, issue or implement any rule, regulation or order regarding the disclosure of political contributions.”

Now the SEC is arguing that the very law intended to block the commission from meddling with campaign finance shields the commission against litigation by three state Republican parties attempting to challenge new rules restricting contributions by private advisors to municipal bond issuers. The SEC’s motion to dismiss a challenge at the 6th U.S. Circuit Court to the new rules has left the Tennessee, Georgia and New York Republican parties fairly sputtering with indignation.

“The SEC turns the Appropriations Act language on its head, asserting that the Act required the SEC to do precisely what it was barred from doing,” the state parties’ lawyers at Bancroft wrote in a brief filed Wednesday.

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Influence

Arizona Daily Star: Pelosi tracks the mega-donors to political campaigns

David Bauder

Many of the big donors wouldn’t talk to Pelosi. But a surprising number did. Pelosi, daughter of House Democratic leader Nancy Pelosi, already knew many of them from accompanying mom on the canape circuit. Some wanted to demystify the process, annoyed at being vilified as the “billionaire class” by Bernie Sanders, and suggest their influence is exaggerated.

The point was made to comical effect by Brad Freeman, who has given more than a million dollars to the Bush family. He got a call from George W. Bush shortly after he was elected, and visions of grandeur danced in his head; Freeman dreamed of a chance to run the C.I.A. Instead, the conversation turned to Bush’s cat, which Freeman had taken a liking to. Bush couldn’t bring the cat to the White House. Would Freeman want it?

When people wonder what he got in return for his donations, Freeman says ruefully, “I got the frickin’ cat.”

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Candidates and Campaigns

The Hill: Katy Perry fundraises for Clinton on convention stage

Megan R. Wilson

The entertainer has been traveling on and off with Clinton throughout the campaign.

“And now you can join her on the road, too,” Perry said.

“If you go to HillaryClinton.com and donate before midnight,” Perry said, “you could win a chance to join Hillary on the road and see for yourself why I know she should be the next President of the United States.”

“And maybe, I’ll let you borrow one of my outfits,” she said.

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The States

Boston Globe: Campaign funding legislation left languishing

Frank Phillips

The new legislation, proposed by Common Cause and several state senators, would tighten a 1998 law that bans state political figures from using federally raised donations. The sponsors were reacting to a ruling by state regulators in April claiming that the use of federally funded donations to support Baker’s and other state political activities is legal because of a “loophole” in the state and federal laws.

House Speaker Robert DeLeo said the bill, which was filed June 9, came too late for the lawmakers to deal with it before the legislative session that ends Sunday. He also wants it studied by a special task force he wants to create.

The bill also would address another area of what Common Cause calls “significant undisclosed money in politics” by requiring disclosure of money raised for party state committee races. In a fundraising blitz never seen before, Baker raised over $300,000 (with no limits on each contribution) this past winter to finance his campaign to take control of the GOP state committee.

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Argus Leader: Campaign reform as crazy as Kim Kardashian on Mt. Rushmore?

Dana Ferguson

A coalition called Defeat 22 is hoping to build opposition to Initiated Measure 22, an extensive ballot measure would create a publicly-funded campaign finance program, would establish a state ethics commission and would lower the amount of campaign funds candidates can accrue. It would also create a state subsidized fund that would give each voter $100 vouchers that he or she could contribute to political candidates.

The latest effort by the coalition that includes Americans for Prosperity, the South Dakota Chamber of Commerce and Industry and the South Dakota Retailers Association, aims to make the idea of publicly-funded political contributions sound as ludicrous as making a Karsdashian the latest addition to South Dakota’s iconic monument.

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