Daily Media Links 3/17: RNLA: FEC’s Democrat Commissioners ask IRS to ignore Commission’s own expertise, The Dangers of Government Control over Campaigns: NYC Edition, The American: Tempest at a Tea Party, and more…

March 17, 2014   •  By Kelsey Drapkin   •  
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In the News

RNLA: FEC’s Democrat Commissioners ask IRS to ignore Commission’s own expertise

By Paul Jossey

As the Center for Competitive Politics commented, the simplest solution is to have the IRS categorize Section 527 groups as those determined by the FEC (or similar state commissions) to be ‘political committees’ i.e. those whose “major purpose” is the nomination or election of candidates. It could then classify the rest under Section 501(c)(4).

This solution would relieve the tax agency of the burdensome task of parsing “issue discussion and advocacy of a political result” on the one hand and the express advocacy of candidate support or opposition on the other. The FEC, having been a party to all major litigation in this area since 1976’s seminal Buckley v. Valeo, is uniquely positioned to make those esoteric determinations with a view toward First Amendment privacy concerns.

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The Dangers of Government Control over Campaigns: NYC Edition

By Luke Wachob

As New York State legislators consider implementing a taxpayer-financed campaign scheme modeled after New York City’s program, a complaint filed against the New York City Campaign Finance Board (NYCCFB) raises an important concern about these programs:  if public funding becomes a necessity to win public office, the government can effectively shut down campaigns merely by denying candidates access to public matching funds.

The plaintiff in the complaint, John Liu, was the New York City Comptroller prior to declaring his candidacy for Mayor in 2013. In New York City’s wasteful taxpayer-financed campaign program, every $1 raised in contributions from citizens is matched with $6 in public funds. With so much money at stake, NYCCFB’s decision to deny Liu public funds amounted to a death sentence for his campaign. According to the complaint, CFB Chairman Rev. Joseph Parkes justified the Board’s decision based on “potential violations” of campaign finance rules.

We’ll see how the facts bear out in this case, but it is undoubtedly troubling to see the government shut down a political campaign over “potential” violations. Whatever happened to innocence until proven guilty? Instead of taking the time to get the facts, the CFB appears to be picking winners and losers. While it’s true that taxpayer-financed campaigns are prone to being gamed and exploited by corrupt politicians, and that New York City’s program in particular has paid out over $19 million to candidates later charged with corruption-related offenses since 2001, the case of John Liu shows how “strict enforcement” can also backfire. If the CFB continues to take an aggressive approach to rooting out campaign finance violations, it becomes very likely that at some point a campaign that’s following the rules will be wrongfully denied public funds and effectively shut down. If Liu’s complaint is accurate, that may have already happened.

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The American: Tempest at a Tea Party

By James V. DeLong

The IRS recently proposed rules designed to hogtie the electoral activities of the Tea Party movement, while leaving untouched the politicking of unions and business groups.

The right reacted with fury, and more than 140,000 comments were filed, mostly outraged. The IRS should back down out of a sense of self-preservation, but it is not clear that maintaining the legitimacy of the agency is anywhere on the administration’s priority list. The rule looks to be the product of a deliberate Progressive offensive, and in this calculus a bit of collateral damage, such as delegitimizing the IRS, is small beer.

Republicans have introduced a bill to stall the action for at least a year. The bill might well pass the House, but the effort is Washington theater. Nothing can pass the Senate, and the Office of Management and Budget recently said that a veto would be in order if something did slip through.

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Wall Street Journal: Opinion: Harry Reid’s War Against the Kochs

Wonder Land columnist Dan Henninger on why the Senate Majority Leader demonized the GOP donors on the Senate floor. 


Fox News: Issa pens scathing letter to Cummings as IRS feud escalates

“… rather than pursuing the facts where they lead — which is the function of effective congressional oversight — you have made yourself an obstacle  to effective congressional oversight, in effect, a defense counsel for Lerner and others who acted to deprive Americans of their constitutionally-guaranteed rights,” the committee chairman wrote. 
In another verbal sting, he continued: “Even though the White House helped orchestrate your ascension to Ranking Member, I have encouraged, and continue to encourage, you to subordinate your political loyalties to the institutional interests of the Committee and the House, especially in cases like this where obstructing the Committee’s work risks permanently disadvantaging Congress in its interactions with the Executive Branch.”
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San Francisco Chronicle: Democrats Vow to Block Attempt to Delay IRS Rule in Ukraine Bill

By Kathleen Hunter

March 13 (Bloomberg) — Senate Majority Leader Harry Reid vowed to block House Republicans from using a Ukraine aid package to delay U.S. Internal Revenue Service rules governing political activity by some nonprofit groups.  

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NY Times: Hollywood Conservatives Are Granted Tax-Exempt Status

By Michael Cieply

LOS ANGELES — Friends of Abe, a loose fellowship of Hollywood conservatives, will be recognized by the Internal Revenue Service as a tax-exempt organization, a lawyer for the group confirmed on Sunday. “Friends of Abe was recognized as a 501(c)(3) public charity effective as of the date of its formation,” the lawyer, Ofer Lion, said in response to an email query.

A request for such status had been under consideration for about three years, as government officials scrutinized Friends of Abe for signs of political activity not permitted to such organizations. (Queried earlier, an I.R.S. spokesman said the agency was not permitted to discuss the business of specific individuals or groups.)

Gary Sinise, Jon Voight and Kelsey Grammer have been publicly associated with Friends of Abe. But the group generally does not disclose the names of members, to protect them from what it sees as possible job discrimination in the more generally left-leaning entertainment industry. While it eschews direct campaign activity, Friends of Abe has often played host to conservative political figures, including Herman Cain, Paul D. Ryan and Ted Cruz.

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Corporate Governance

AP: Missouri secretary of state calls for SEC to require businesses report political spending

Kander, a Democrat, says investors want to know how money has been spent for political purposes by the companies in which they invest.  
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Candidates, Politicians, Campaigns, and Parties


Huffington Post: Obama Will Appear At Two Super PAC Events 

By Sam Stein

WASHINGTON — Senior Obama administration officials confirmed on Thursday that President Barack Obama would be appearing at two super PAC events this election cycle to help support Democratic candidates.

The officials, who would speak only on condition that they not be quoted or identified, said that these events would not be fundraisers. Instead, the president would speak before gatherings hosted by House Majority PAC and Senate Majority PAC in order to draw an audience to their cause (electing House and Senate Democrats, respectively). After he was done and gone, they added, the checks would be exchanged.

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National Journal: The Actual Intention Behind That Awkward Mitch McConnell Video (Democrats are making jokes now, but they do this too.)

By Shane Goldmacher
Candidates and the super PACs that support them aren’t allowed to share videos, or any other information, in private. So campaigns have increasingly gone public, posting B-roll clips of their candidates shaking hands with all sorts of constituents in hopes that the images wind up in future TV ads.  

Hence, the Senate minority leader’s montage includes clips of him with fellow Kentuckian Sen. Rand Paul standing behind him; shaking hands with students and veterans; sitting beside his wife; standing in front of a “Women for Mitch” sign; working in his office and sauntering down local streets.  

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Lobbying and Ethics

The Hill: Cloud darkens over Patton Boggs

By Kevin Bogardus and Megan R. Wilson

Layoffs, merger talks and late paychecks have darkened the cloud hanging over the Washington lobbying powerhouse Patton Boggs.
While the leaders of the firm, the longtime king of K Street, acknowledge that they are going through tough times, they deny that the firm is in financial straits.
“We have been through a hard time and we have more work to do, but we are doing fine,” said Ed Newberry, Patton Boggs’s managing partner.
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Roll Call: Ethics Committee Gets New Staff Director

By Matt Fuller

The Ethics Committee announced a major staffing decision Thursday, with a longtime committee staffer becoming the staff director and chief counsel.  

Tom Rust, who has served in a number of roles on the Ethics panel since 2009 — including as a nonpartisan staff attorney, a member of several units on the committee, and as interim staff director and chief counsel — fills the shoes of former staff director and chief counsel Dan Schwager, who left last November.  

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More Soft Money Hard Law: The FEC and the Making of Law “Case-by-Case”

By Bob Bauer

A conflict—the latest in the series—has broken out among FEC Commissioners about whether they have made public all relevant material on the General Counsel’s  view of Crossroads GPS and whether it is a “political committee.”  In one report, the GC concluded that the evidence supported further investigation of the question, but the Commission deadlocked, and now a private lawsuit is looming.  Republicans seem to believe that the public record is incomplete and that the missing GC analysis would have a bearing on the legal merits of Crossroads’ position.   Whatever the facts of the matter, this ruckus reminds readers once again of the troubled condition of the Commission’s “case-by-case,” fact-specific approach to determining “political committee” status. 

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State and Local

Colorado –– Denver Post: Scott Gessler loses appeal over ethics ruling

By Lynn Bartels

A Denver District Court judge has sided with the state’s ethics commission in a case involving Secretary of State Scott Gessler, who was found guilty of violating Colorado’s ethics laws by using state money to attend a Republican event in Florida in 2012.

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District of Columbia –– Washington Post: Former D.C. council member’s treasurer charged with stealing from campaign

By Ann E. Marimow

Former D.C. Council member Michael A. Brown’s campaign treasurer has been charged with stealing more than $100,000 from the candidate’s bank account in a case that bolsters the politician’s explanation of the missing money.  

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Kelsey Drapkin


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