FSFP Releases Part II of Report: Undermining Federal Limits on Contributions to Political Parties

This report is a follow-up to Stephen R. Weissman’s previous findings in, “The SpeechNow Case and the Real World of Campaign Finance“, which focused on data surrounding super PAC donors and their direct contributions to the same candidates that they subsidize indirectly via super PACs.

“As I argued in my October 2016 study, “The SpeechNow Case and the Real World of Campaign Finance,” this opinion ignored an essential component of political reality. It discussed the distance between independent spending groups and beneficiary candidates but said nothing about any relationship between their respective donors. In the real world, the distance the Court presumed to exist between candidates and independent groups is bridged by the fact that they often share common large donors. Federal campaign finance data from the 2012 and 2014 election cycles show that the vast majority of top individual and organizational donors to Super PACs and other disclosing independent spenders contributed simultaneously to candidates and to independent groups supporting the very same candidates.”

— Stephen R. Weissman

Part II: Undermining Federal Limits on Contributions to Political Parties“, explores the top 100 individual and 50 organizational donors to independent groups in the 2012 and 2014 elections. It focuses on those who gave to one or more of the six official national party committees and also contributed to unofficial party-linked Super PACs active in the same election(s).

In the present study, I examine the same universe of top outside money donors to the 2012 and 2014 elections. The analysis focuses on donors who contributed to national party committees in a particular cycle while simultaneously donating to independent, party-linked Super PACs in the same elections. It turns out that a considerable proportion of top individual and organizational donors to independent groups – approximately 40 to nearly 50% – followed a two-track policy of making legally limited contributions to party committees while also providing massive funds to party-linked Super PACs for the same elections.

There are federal limits on how much a donor can give to an official party committee per year, but following the SpeechNow ruling, there are no set limits on contributions to party-linked super PACs.

For example, in 2014, the maximum a donor could give to a party committee per year was $32,400; assuming a donor who gave to all three committees of one party, that’s $97,200 to party committees. Under federal law, $97,201 would be illegal—too high a risk of quid pro quo corruption—but that same donor can give millions to party-linked super PACs. In essence, donors can multiply their legal direct party contributions by giving to party-linked super PACs at levels far beyond what Congress has determined is necessary (and the Supreme Court has so far upheld) to protect against corruption. This pattern of giving completely undermines the limits on contributions to parties.

In its influential SpeechNow.org v. FEC opinion, the U.S. Court of Appeals for the District of Columbia Circuit ruled that contributions to a group making independent expenditures supporting a candidate pose no danger of quid pro quo corruption or its appearance, and therefore may not constitutionally be limited by the government. The Court reasoned that since an independent expenditure is, by definition, not prearranged or coordinated with a candidate, “the danger that the expenditures will be given as a quid pro quo for improper commitments from the candidate” is alleviated, and the same logically follows for contributions to make such expenditures. Since independent spenders and their donors inhabit one side of the street and candidates and their donors the other, the constitutional rationale for limiting political contributions does not apply to donations to independent groups.

The large donors surveyed in this study made very substantial contributions to their preferred party committees. The size of these contributions, while within legal limits, assured that these donors would be noticed by party fundraisers, many of whom were themselves candidates and elected officials. When these donors simultaneously embellished their financing by massively subsidizing independent Super PACs linked to the same parties in the same elections, they intensified the danger of corruption and its appearance.

By ignoring such political realities, the SpeechNow decision has helped undermine federal contribution limits, the primary means of federal regulation of campaign financing.

Comments are closed.