October 24, 2019

By Gabrielle Gesek, Associate Editor 

“A house divided against itself, cannot stand.” –Abraham Lincoln 

It may come as no surprise that many Americans believe the political system is broken. Extreme partisanship, a disinterested electorate, and lack of congressional accountability contribute to the current political swamp. But, perhaps, the most pervasive issue undermining the modern political system stems from campaign finance law. In fact, Americans believe that reducing the influence of money in politics is one of the top five most important issues facing the country today. Electoral politics were designed to ensure that the “will of the people” is accurately expressed and represented in each election. However, in recent decades, wealthy interest groups have gained significant power in influencing elections through large monetary donations. Over $5.2 billion was spent on the recent 2018 midterm elections, crowning it as the most expensive midterm election in U.S. history. Outside interest groups shattered records by spending $1.3 billion, while dark money funds ushered in around $98 million. Consequently, according to a recent Pew Research Center report, 77% of the American public says “there should be limits on the amount of money individuals and organizations can spend” on political campaigns, and 65% think new campaign finance laws could effectively reduce the role of money in politics.  Although outspending political opponents in an election may not always secure a win, it does raise the question: Who are our elected officials accountable to, their constituents or their contributors? 

Americans from both sides of the aisle overwhelmingly agree that people who make large political donations should not have more political influence than others. Voters worry that this monetary influence leads to a type of “ingratiation and access” giving wealthy groups the upper hand in Washington, even if the Supreme Court has repeatedly determined that such access falls short of actual corruption. The Federal Election Commission (“FEC”) was created in the aftermath of the Watergate scandal as an independent regulatory agency charged with “administering and enforcing” federal campaign finance law. Although the FEC aims to provide transparency, fair enforcement, and administration of federal campaign finance laws, the Agency has been criticized by its own former Chairwoman as “betraying the American public and jeopardizing [] democracy.” Essentially, the dysfunction of American politics is mirrored in the very Agency responsible for overseeing the democratic process.

The FEC was created to enforce campaign finance laws to ensure fair elections, but the FEC has failed to prevent the undue influence of super PACs in dominating elections. With the continuing rise of super PACs, and the Supreme Court’s unwillingness to curb their political spending, how can a Commission effectively regulate the most painstaking issue in American politics today, when its members cannot reach a consensus on whether to serve bagels or doughnuts at an event?

Although Americans largely believe donations pose a problem, campaign finance law upholds a technical view of donations. Under current federal law, independent expenditure-only political action committees – commonly known as super PACs – can raise unlimited sums of money for corporations, unions, associations, and individuals, and then use those funds to advocate for or against political candidates. Super PACs have infiltrated American political elections by accepting unlimited contributions and making unlimited expenditures aimed at electing or defeating federal candidates. These unlimited monetary contributions have been criticized as influencing the outcome of elections.

While the impact of super PACs may be “overblown” at times, super PACs should be subject to increased regulation and stricter enforcement to ensure transparency in campaign disclosures. But the Agency assigned to enforce campaign finance law is unable to effectively regulate. The FEC’s internal structure and process of appointing commissioners has rendered the Agency unable to effectively enforce campaign finance violations due to voting deadlock and congressional control over the Agency’s budget.

The FEC’s current six-member composition, allowing no more than three Commissioners from same political party, facilitates the Agency’s consistent 3-3 voting deadlock in enforcement proceedings. Because an affirmative vote of four commissioners is required at every stage of decision making, it has become commonplace for the Commission to split 3-3 and deadlock the issue. While the four-vote requirement was created to ensure bipartisanship, it allows ample opportunity for deadlock which prevents the Commission from enforcing finance laws like disclosure violations.

In addition to the voting deadlock, the process of appointing Commissioners contributes to agency capture, which in turn, dilutes the enforcement power of the Agency. Although Commissioners are officially nominated by the President, and confirmed by the Senate, in practice, the President defers to the recommendations of the House and Senate party leaders, regardless of political power. This informal structure has led to agency capture which results when a regulatory Agency is created to protect the public interest but instead forwards the agenda of special interest groups that exercise control over the Agency. Here, the Commissioners owe their positions on the FEC to the very persons they regulate: Congress and the President.

Members of Congress have a “dual stake” in campaign finance policy acting as both regulator and regulatee. When the FEC enforces campaign finance regulations that will affect a congressperson’s future reelection campaign, Congress threatens to cut the FEC’s budget. Congress exercises considerable control over the FEC through its sole discretion over the Agency’s budget. This control has led to Agency capture preventing the FEC from aggressively enforcing super PAC disclosure violations because members of Congress depend on super PAC donations to fund their campaigns. The basic democratic notion that voters are entitled to information about the candidates they are electing is under attack. Super PACs and dark money groups are threatening democratic accountability and the FEC is incapable of protecting citizens from this phenomenon. 

The FEC is no stranger to fierce criticism, congressional threats, public disdain, and even school yard name-calling. Given these concerns, Congress must enact a comprehensive campaign finance reform bill, which would expand the recently proposed H.R.1 bill, to combat the even-numbered voting deadlock problem and weaken congressional control over the Agency’s budget. To achieve this, the agency’s structure and budget must be changed.

The number of FEC Commissioners must be reduced to five to prevent deadlock and facilitate the voting process. The FEC can limit Congress’s power over the Agency’s purse in three distinct ways: (1) by earning money through charging fees for Advisory Opinions and collecting fees through enforcing violations; (2) by delegating control over the Agency’s budget to the Federal Reserve; and (3) by resurfacing random auditing. By limiting Congress’s control over the FEC’s budget, the Agency will not have to fear budget cuts every time it makes a decision that will negatively affect a congressperson’s next campaign.

Enacting a reform proposal similar to H.R.1 may be the FEC’s only chance at survival. Congress, which has created and perpetuated the issues causing the FEC’s dysfunction, is the very institution that must now fix the Agency. But Congress is not going to act on its own good heartedness, the voting public must step in. Like Congress which holds the power to control the FEC through Agency capture and its budget, voters hold their own greater power over Congress: reelection. By placing pressure on Congress to act, a comprehensive new bill can be drafted, and ultimately passed into law, which will effectively change the structure of the FEC, and weaken Congressional influence over the FEC’s budget. This new wave of Agency efficiency will help the FEC to enforce super PAC disclosure violations and restore transparency to American electoral politics.