Chambergate, and the unwittingly radical reach of reform

October 11, 2010   •  By Brad Smith
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We have noted the absurdity of Chambergate and the liberal groups that are pushing the claim that the U.S. Chamber of Commerce is somehow “stealing” American elections with foreign money.  I have also been critical of those who foster such conspiracy views as raising valid questions.

Professor Richard Hasen argues that all these questions would go away – or at least be alleviated – if the FEC merely had the power to conduct random audits of political actors.  Now, during my time as FEC Commissioner and Chairman, I publicy favored (and still do) giving the FEC the power to conduct random audits of political committees (others at CCP do not).  But Professor Hasen’s proposal goes far beyond that.  Professor Hasen appears to want the FEC to have the authority to conduct random audits of any political actor or speaker.  That is, he makes no distinction between political committees, i.e. the parties and candidate campaigns, and PACs that contribute directly to candidates, and any American citizen or group of citizens that chooses to exercise its Constitutional rights to make independent political expenditures.

This goes far beyond the traditional call for random audits of political committees.  Under Professor Hasen’s theory, any citizen who spends a few hundred dollars on independent radio ads could be subjected to random audits by the FEC.  Of course, we might exempt small spenders (although the current law does not, requiring reporting at just $250 in independent expenditures).  But a wealthy citizen such as George Soros or Sheldon Adelson could still be subject to audits of their finances, not merely by the IRS but by the FEC, in order to determine that all their political spending is properly reported, and that they are not acting as a front for foreign spending.  A union or business, including a non-profit such as the Chamber or the NAACP, that makes independent expenditures, as is their constitutional right, would also be subject to audit by the FEC. 

Moreover, these audits could be, and in most cases would be (if we’re serious, anyway) far more extensive than a typical IRS audit.  For example, in order to assure that no illegal activity was underway, the FEC would have to investigate to make sure that the groups did not coordinate their activities with a candidate or political party or committee.  (For example, if and the Center for American Progress have coordinated their attacks on the U.S. Chamber and various Republican candidates with the DCCC, Democratic candidates, or Democratic party officials, their expenditures are illegal, undisclosed contributions.  Should we be auditing them? Should they be forced to prove they are in compliance with the law?  Why should we trust them, as they ask of the Chamber?). This means reviewing internal correspondence and documents, appointment calendars, telephone records, and private emails.  This would not be done on the basis of any reasonable suspicion or probably cause, but simply as a “random audit.”  Essentially, every person who participates in American elections would be subject to random audits of their personal finances and poltiical conversations and dealings. 

For years, those of us who favor even modest deregulation of the political system have been frustrated by the apparent unwillingness of “campaign finance reformers” to focus on the practical ramifications of enforcement, to consider possible costs as well as perceived benefits, and to be willing to accept something less than an unworkable, utopian vision of the law.  The latest trend seems to be unrealistic views of what “disclosure” can accomplish, and the belief that disclosure imposes few or no costs. 

Though it may sound innocuous, the idea of random audits of groups or individuals other than political committees that make independent expenditures is a truly radical idea that would impose unprecedented burdens on political speech and association.  “Reformers” making the suggestion seem not to have thought through that which they now recommend.  Those of us who worry about free speech and association and open political dialogue can’t afford that luxury.    

Brad Smith

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