Category Archives: campaign finance

The Parallels in the TikTok Ban Case and Regulation of Campaign Spending by Foreign Nationals

campaign finance, First Amendment theory

The DC Circuit has held that the U.S. government can force the sale or shutting down of TikTok because of concerns about the influence of the Chinese government over the actions of the platform’s parent company. Among other things, the court rejected an argument that shutting down the platform violated TikTok’s First Amendment rights. The D.C. court wrote: “In this case, a foreign government threatens to distort free speech on an important medium of communication.”

So while under the Supreme Court’s NetChoice case, government content moderation control violates the First Amendment, when it comes to foreign controlled platforms under the TikTok case, government content moderation control prevents distortion and promotes First Amendment values.

In reading the DC Circuit opinion , I was reminded of a parallel dispute in the campaign finance arena over limiting spending by foreign nationals. In Citizens United, the Court held that domestic corporations cannot be limited in how much they can spend to influence federal elections. Citizens United rejected the argument, previously accepted in cases such as Austin v. Michigan Chamber of Commerce, that preventing distortion of the political marketplace could justify such a ban.

And yet the Court in Bluman v. FEC soon after Citizens United allowed a complete ban on spending by foreign nationals, citing the interest in preserving democratic self-government. As I’ve explained, this too is an anti-distortion rationale.

In Bluman and TikTok, the courts reached divergent conclusions because of the foreign identity of the speaker. But they don’t recognize the tension.

The D.C. Circuit did not cite Bluman in TikTok but it might as well have. When the case makes its way to SCOTUS, I expect the Bluman parallel will get some play.

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“Trump Is Running His Transition Team on Secret Money”

campaign finance, tax law and election law

NYT:

President-elect Donald J. Trump is keeping secret the names of the donors who are funding his transition effort, a break from tradition that could make it impossible to see what interest groups, businesses or wealthy people are helping launch his second term.

Mr. Trump has so far declined to sign an agreement with the Biden administration that imposes strict limits on that fund-raising in exchange for up to $7.2 million in federal funds earmarked for the transition. By dodging the agreement, Mr. Trump can raise unlimited amounts of money from unknown donors to pay for the staff, travel and office space involved in preparing to take over the government.

Mr. Trump is the first president-elect to sidestep the restrictions, provoking alarm among ethics experts.

Those seeking to curry favor with the incoming administration now have the opportunity to donate directly to the winning candidate without their names or potential conflicts ever entering the public sphere. And unlike with campaign contributions, foreign nationals are allowed to donate to the transition….

Mr. Trump’s transition team, formally known as Trump Vance 2025 Transition Inc., has revealed nothing about how much money it hopes to raise, who has contributed to the fund or how it is spending the money.

The current Trump transition, like its predecessors, is set up as a “dark money” nonprofit. Those groups typically do not have to disclose their donors, even to the Internal Revenue Service. But unlike Mr. Trump’s team this year, earlier transitions accepted financial support from the General Services Administration, which oversees much of the transition process. In exchange for that federal money, they agreed to conditions that other dark-money nonprofits do not have to follow, like capping individual contributions at $5,000 and disclosing the names of their donors.

When Barack Obama won the presidency in 2008, his transition raised $4.5 million while restricting donations to a maximum of $5,000, and pledging to refuse money from corporations, labor unions, political action committees, lobbyists and registered foreign agents. Nearly 60,000 people contributed, with an average donation of about $75….

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New Interactive Data Base from the Center for Political Accountability

campaign finance

The Center for Political Accountability today announced the launch of The Barbara and Morris Pearl 527 Interactive Database, a user-friendly interactive database created to shine a spotlight on under-the-radar corporate political spending in the United States.

The database has two interactive portals:

  1. Donations Database: Tracking the flow of funds from public companies to major 527 organizations and covering available data from 2010 through October 2024;
  2. Spending Database: Analyzing how these 527 groups spend corporate contributions on key state-level races and covering the 2022 and 2024 cycles.

The tool is intended to provide a timely and essential resource for understanding the role of corporate money in shaping state-level elections. It is designed for users to easily navigate and uncover data that were previously difficult to access.

In the near future, CPA will schedule a webinar to assist journalists in their use of the database.

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“Supreme Court won’t hear challenge to Alaska campaign finance laws”

campaign finance, Supreme Court

I missed this news yesterday:

More than 14 years after the Supreme Court’s decision in Citizens United v. Federal Election Commission, which removed limits on independent political expenditures by corporations and unions, the justices declined to weigh in on a challenge to the constitutionality of two campaign-finance laws enacted by Alaska voters in 2020.

The laws were put in place to target the role of “dark money” – money spent to influence elections, but without the public knowing the source of the funds. One regulation requires anyone who gives more than $2,000 in a calendar year to groups that spend money to influence the elections of candidates to report the donation within 24 hours. A second regulation requires election ads to disclose when a majority of the donations that fund it come from outside Alaska.

Five voters and two groups that spend money on elections went to federal court in Alaska, arguing that the regulations violate the First Amendment. A federal district judge rejected their request to block the regulations before the 2022 elections, and the U.S. Court of Appeals for the 9th Circuit upheld that decision.

The challengers came to the Supreme Court this summer, asking the justices to take up their case. They contended that the regulations are an “outlier among all state and federal campaign finance rules” that place “unprecedented burdens on citizens’ right to speak about matters of public concern.” But after considering the appeal at five consecutive conferences, the justices ultimately denied review on Monday without comment.

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“Inside the Republican false-flag effort to turn off Kamala Harris voters”

campaign finance, campaigns

WaPo:

Muslims in Michigan began seeing pro-Israel ads this fall praising Vice President Kamala Harris for marrying a Jewish man and backing the Jewish state. Jews in Pennsylvania, meanwhile, saw ads from the same group with the opposite message: Harris wanted to stop U.S. arms shipments to Israel.

Another group promoted “Kamala’s bold progressive agenda” to conservative-leaning Donald Trump voters, while a third filled the phones of young liberals with videos about how Harris had abandoned the progressive dream. Black voters in North Carolina were told Democrats wanted to take away their menthol cigarettes, while working-class White men in the Midwest were warned that Harris would support quotas for minorities and deny them Zyn nicotine pouches.

What voters had no way of knowing at the time was that all of the ads were part of a single $45 million effort created by political advisers to Tesla founder Elon Musk who had previously worked on the presidential campaign of Florida Gov. Ron DeSantis (R), according to a presentation about the group’s efforts obtained by The Washington Post.

The project, funded with anonymous donations, micro-targeted messages across the battleground states, often with ads that appeared to be something they were not — a tactic the organizers sometimes referred to internally as “false positives.”

With digital spots, direct mail, text messages, influencer marketing and mobile billboards, the overall project was a high-tech experiment in misdirection — an old political tactic that has been sharpened in recent decades with increasingly precise targeting techniques.

Ads tested better if Muslims felt they were seeing a message meant for Zionists, “Bernie bros” felt they were hearing from the far left, and “Zyn bros” felt they were hearing from activists who wanted “a world without gas-powered vehicles,” a ban on fracking and affordable housing for undocumented Americans — policies Harris did not actually support during her campaign.

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“Clashes, confusion and secrecy consume the Harris campaign’s finances”

campaign finance, campaigns

NBC News:

If Kamala Harris’ campaign was known for anything, it was its blockbuster fundraising. In just a matter of months, it crossed the $1 billion mark, in a stunning and record-breaking pace.

Now, less than a week since the vice president conceded the contest, it not only has run out of money, it’s still asking for more. The campaign emails and texts, known for their ubiquity throughout the election, aren’t expected to stop anytime soon.

“Hi Team, It’s Kamala, The election isn’t what we wanted, but I will never give up the fight,” a text message sent Tuesday said. “And right now there are still a number of critical races across the country that are either too close to call, or within the margin of recounts or certain legal challenges.”

Two campaign officials said the requests are for money meant to eventually flow to the Democratic National Committee to help assist with efforts such as state recounts or curing ballots.

One of the officials acknowledged there was some debt but downplayed its significance, saying it would not be difficult to pay off by year’s end. The official also stressed that, given the results of the election, it would have been worse to have lost while sitting on a pile of unspent cash. 

But several campaign officials questioned that contention, saying it appeared the requests were meant to pay down debt. One senior campaign official called the practice of asking supporters for more money after losing decisively and having taken in so much money as “appalling” and another described it as “disgusting.” A third person who was flooded with complaints from donors questioned how Democrats could save their credibility moving forward.

The overarching challenge at this point for what is left of Harris’ campaign is that the financial picture is shrouded in mystery — even for those within the organization. No one can — or will — spell out a clear status of its finances. Reports have surfaced about debt that’s reached into the tens of millions of dollars — a narrative that’s taken on a life of its own in conservative media and, much to the dismay of donors, even brought a troll from Donald Trump over X.

“Whatever we can do to help them during this difficult period,” Trump teased on X.

The campaign on Wednesday said it is an inaccurate characterization of the debt. One senior official flatly stated in an interview this week: “That’s completely wrong.” 

Five sources with direct knowledge of the campaign’s internal finances confirmed to NBC News that it has indeed accrued debt. But none could point to a specific amount; several people threw out possibilities, with the lowest beginning at $6 million. ..

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