By Scott Blackburn
To understand the differences in how states restrict citizens’ abilities to support their favored candidates and causes, the Institute for Free Speech categorized each of the 50 states’ contribution-limit laws and measured their impact on free speech. The result is the first of its kind “Free Speech Index.”
To those familiar with the politics of campaign finance law, the results may be surprising. Eleven states have no limits whatsoever on individual contributions to candidates. They include liberal Oregon and deep-red Alabama (both tied for first in the Index). They include the second most populous state, Texas (ranked 9th), and the third least populous state, North Dakota (ranked 9th). They include eastern states (9th ranked Pennsylvania), western states (1st ranked Utah), midwestern states (7th ranked Iowa) and southern states (1st ranked Virginia)…
Twenty-eight states have no restriction on how much an individual can contribute to a political party, among them liberal stalwart Washington (ranked 20th), conservative stronghold South Carolina (ranked 35th), and swing state Wisconsin (ranked 22nd). But West Virginia (ranked 49th) and Rhode Island (ranked 42nd) have decided to limit individual donations to parties to just $1,000. Massachusetts (ranked 44th) allows contributions from unions to candidates, but prohibits contributions entirely from corporations, while New Hampshire (ranked 39th) prohibits union to candidate contributions altogether and allows corporations to donate directly. Neighboring Vermont (ranked 21st) allows both unions and corporations to contribute.
Daily Caller: The Different Ways States Regulate And Protect Our First Amendment Rights (In the News)
By Scott Blackburn
By Joe Albanese
The Institute’s Free Speech Index scores and ranks all 50 states on their laws governing political giving, grading them from A+ to F. Fortunately, Indiana ranked as one of the top states in the country, earning an A grade. This places it alongside 10 other states that earned an ‘A’ or higher. One crucial trait these states have in common is that they don’t limit the freedom of individuals to give to candidates, parties, and political committees, as well as the ability of parties and political committees to give to candidates…
Why is it so important that states like Indiana allow freedom in political giving to and between these groups? Because the main effect of government-imposed restrictions on political giving is to limit the amount of speech individuals, organizations, and political actors can express. Giving money is not just a show of support. It also enables candidates and groups to spread their message further.
That means stringent campaign finance laws tend to favor incumbents and hinder challengers…
Lawmakers in Indiana deserve praise for preserving their constituents’ First Amendment freedoms. Many politicians find it easier to pass laws that make it harder for voters or rival candidates to criticize them. They do so while claiming they are protecting voters from the rich, when really, they are protecting themselves.
By Thomas Wheately
The case, known as First National Bank of Boston v. Bellotti, challenged the constitutionality of a Massachusetts law that censored speech by corporations on ballot measures. The law included criminal penalties.
In a 5-4 decision, the Court struck down the law, reversing the Massachusetts Supreme Judicial Court. “We … find no support” the Court held, “for the proposition that speech that otherwise would be within the protection of the First Amendment loses that protection simply because its source is a corporation…” …
But that’s wrong – very wrong. For decades, the Supreme Court has recognized a corporation’s right to free speech. The Citizens United opinion alone cites 25 cases supporting this point, the first cited case being Bellotti, though it was not the first such decision. Nor, as some have suggested, has the Court ever recognized a so-called “media exemption,” which would grant press outlets full First Amendment protection, but not other corporations. Indeed, the Court has explicitly rejected that argument…
Americans of all political stripes have long reaped the rewards of the sort of corporate speech protected by Bellotti and earlier rulings. Take, for example, the civil rights movement.
In 1964, the New York Times defeated a dubious libel suit brought by white southerners in part because the newspaper, a corporation, was able to invoke First Amendment protection.
Washington Examiner: Maryland lawmakers voted to criminalize online speech in the name of security (In the News)
By Eric Wang
More than a thousand students gathered at the Maryland state capitol in March as part of the national “March for Our Lives” demonstrations against school shootings. Presumably, these students used the Internet, social media, or mobile device apps to organize their rally.
In so doing, they may have committed a crime under an obscure Maryland law.
Instead of fixing this flawed speech law, the Maryland General Assembly recently passed a bill to reenact and expand it. The legislation purports to counter foreign online political propaganda. But in reality, the new burden it would place on Marylanders’ Internet speech threatens our First Amendment rights. Gov. Larry Hogan, R, should veto the bill.
At issue is HB 981, the so-called “Online Electioneering Transparency and Accountability Act.” If signed into law, the bill would reenact the state’s existing regulation of “campaign material.” The term includes any “material transmitted by or appearing on the Internet or other electronic medium” that “relates to” a candidate, prospective candidate, ballot measure, or prospective ballot measure. If you think about it, that includes just about anything…
It is bad enough that HB 981 would reenact Maryland’s unconstitutional speech law. But the bill would make matters even worse by imposing a whole host of additional reporting and record-keeping requirements.
By David Herzig
There has been a politically charged debate in academic circles for a while now about events that happened in 2013 regarding IRS investigations into groups purportedly because of the use of the term “Tea Party” in their name.
Paul L. Caron on the TaxProf Blog has been running a mostly continuous post (up to around day 1830) about “The IRS Scandal.” …
[A]n interesting feud between Bradley A. Smith (and others) and David Cay Johnston (and others) percolated over the facts associated with Professor Smith’s Wall Street Journal Op-ed…
In the opinion piece, Professor Smith asserts that, “[t]he easy fix here would be for Congress simply to scrap restrictions on political activity by social-welfare organizations, thereby stripping the IRS of authority to decide which groups are “political committees” and which aren’t.” The problem with this “easy fix” is that it fundamentally misses a key distinction between 501(c)(4)’s and political committees – 501(c)(4)’s do not disclose donors while PACs are required to. By collapsing the distinctions, it would appear that Professor Smith would allow PACs to have anonymous donors. The current system at least provides that the more involvement in politics that an entity has, the more transparency is required.
Instead of bickering over the facts some 10 year later, it would be much more productive to focus on the problems of adequately funding the IRS as well as related the fixes to the 501(c)(4) political action committee regime.
Ed. Note: Reply from Bradley A. Smith: “No, under plan I proposed in WSJ, pacs could not have anonymous donors, because FECA prohibits that (or state law for state pacs)…
“And that’s basically my point– this should not be an IRS issue at all.”
TaxProf Blog: The IRS Scandal, Day 1829: Wyland Says Johnston’s Op-Ed Contains ‘A Number Of Breathtaking Distortions And Omissions’ (In the News)
By Paul Caron
TaxProf Blog op-ed: David Cay Johnston’s Op-Ed Contains ‘A Number Of Breathtaking Distortions And Omissions,’ by Michael L. Wyland (Sumption & Wyland, Sioux Falls, SD):
In his op-ed Bradley Smith’s WSJ Op-Ed Is A ‘Breathtaking’ Distortion Of The Facts Of The IRS ‘Scandal’, Pulitzer prize winning journalist and author David Cay Johnston has forgotten an old aphorism. When one points an accusing finger at someone, three fingers of the same hand point back at oneself. In short, Johnston’s response to Bradley Smith’s Wall Street Journal commemoration of the fifth anniversary of the IRS scandal contains a number of breathtaking distortions and omissions of its own…
There was a 2017 TIGTA audit report that indicated IRS review of applications for tax exemption that included other types of suspected political activity besides conservative, but that report covered a time period that began in 2004, six years before the 2010 inception of the “tea party cases” activity by the IRS…
Those who point to the 2017 report conveniently ignore a prior 2014 TIGTA report issued in response to assertions by Democratic members of Congress who sought to document the ecumenical nature of the IRS activity.
That report confirmed that the overwhelming majority of the applications flagged were indeed from conservative-sounding organizations, and that the small minority of applications that were also flagged during that time appeared to be included in the group accidentally for reasons not related to their presumed political ideology or assumed activities.
Filed Under: In the News
By Caleb P. Burns and Eric Wang
Based on how campaign finance laws are often portrayed in the news media, the conventional wisdom holds that the campaign finance system is in need of perpetual “reform.” Such reforms typically entail a one-way ratchet in favor of more restrictions on campaign contributions and speech. However, a new study by the Institute for Free Speech (IFS), ranking the 50 states’ campaign contribution laws, challenges that conventional wisdom. In addition to underscoring the challenges that our clients often face when making contributions in connection with state elections, the IFS study suggests that, to the extent “reform” is needed at the state level, it should be in the direction of liberalization.
As the IFS “Free Speech Index” highlights, the United States’ system of federalism is both a boon to policy innovation and a compliance headache for clients that conduct activities in a multitude of states. As IFS notes, its study “challenge[s] the assumption that campaign contributions are regulated in a similar manner by all states. Quite the contrary.” Overall, the study notes that campaign contributions are “more highly regulated than at any time prior to the 1970s, and in some important ways more highly regulated than ever.” …
The policy implications of the IFS study are significant. As IFS explains, “[t]he right to contribute to candidates, parties, and political groups allows citizens to simply and effectively join with others to amplify their voices and advocate for change. The right to speak out about politics is a core First Amendment right, and limits on one’s political donations infringe on that right.”
By Luke Wachob
A new report by the Institute for Free Speech grades the states on political giving freedom and offers the clearest picture to date of how states limit contributions to candidates, political parties, and political action committees. These limits make life difficult for upstart challengers and others who lack a pre-existing base of financial support. But exactly how cumbersome they are varies tremendously from state to state.
Consider a candidate for the Colorado General Assembly. Despite the fact that many of these candidates will have to campaign in the expensive Denver media market, they can accept no more than $200 per election from individuals. In addition, corporations and labor unions are prohibited from giving any money to candidates. Cross the border in neighboring Nebraska, and it’s a totally different story. The Cornhusker State has no contribution limits at all, allowing individuals, groups, businesses, and unions to donate as they please.
The pattern repeats across the country. One state will impose low limits across the board, while a neighboring state has no limits whatsoever, and yet another has a mix of moderate limits on some kinds of giving. So it is that a candidate in Virginia faces no limits on contributions from individuals, while a candidate in West Virginia is limited to $1,000 per donor. A candidate for the South Dakota House of Representatives can also accept no more than $1,000 per individual, while a candidate in North Dakota can accept unlimited amounts, just like in Virginia.
Daily Caller: Clinton Campaign Funneled $150,000 To Hillary Clinton’s Personal Company (In the News)
By Andrew Kerr
The Clinton campaign’s rent payments to ZFS vary greatly…
“I would think that’s not usual,” [former FEC chairman and founder of the Institute for Free Speech Brad] Smith told TheDCNF. “That would be something that would cast out as to whether they’re actually paying market value.”
A possible explanation is that ZFS is extending credit to the Clinton campaign. If that were the case, however, that could open up the Clinton campaign to reporting violations, according to Smith.
“You can’t extend credit to a campaign on different terms than you would anybody else,” Smith said. “A landlord can’t say, ‘well, you just pay me what rent you can when you can’ – no, you can’t do that.”
Smith said the varying nature of the campaign’s payments ZFS lead him to believe there likely isn’t a formal sublease agreement in place between it and Clinton’s LLC.
“That’s what it sounds like, they don’t have any actual agreement,” he said…
“The bottom line is that there’s a bunch of Clinton affiliated organizations that are renting space up there, and it doesn’t seem like there’s much really going on,” Smith told TheDCNF. “Rental payments all go to Hillary Clinton through her LLC.”
“Obviously, it has a certain fishiness to it,” he added. “If they are charging market rates, there’s probably nothing illegal per se about doing business with your own company charging market rates.”
Center for Public Integrity: Politicos beware: Court ruling could prompt more transparent campaign spending (In the News)
By Carrie Levine
The decision Friday involved three staffers from the 2012 presidential campaign of Ron Paul, R-Texas. The Paul staff members – Jesse Benton, John Tate and Demetrios Kesari – were convicted in 2016 of charges connected to $73,000 in payments to an Iowa state senator…
The three men made the payments to the state senator, Kent Sorenson, via a third-party video production company…
Lawyers for Benton, Tate and Kesari argued that the law, and FEC precedents, don’t prohibit a campaign paying a vendor who then pays a subcontractor, even if campaign finance reports only show the name of the original vendor. Prosecutors said it was illegal to hide the purpose of the payments, which were described as “audio/visual expenses,” when they were really made in exchange for Sorenson’s endorsement…
Democratic nominee Hillary Clinton’s campaign helped fund an infamous dossier on Trump – the campaign paid law firm Perkins Coie, which then hired a research firm, Fusion GPS, to conduct research on Trump. The Campaign Legal Center accused both Clinton’s campaign and the Democratic National Committee of failing to file accurate campaign finance reports and has a complaint pending at the FEC against both entities.
“If I’m Perkins Coie, right now I’m a bit nervous about the reporting of payments to Fusion GPS,” said Brad Smith, a former FEC chairman and current chairman of the Institute for Free Speech.