This file contains archived live captions of the open meeting of the Federal Election Commission held on September 15, 2016.  This file is not a transcript of the meeting, and it has not been reviewed for accuracy or approved by the Federal Election Commission.

>> I'd like to recognize commissioner Weintraub for point of personal privilege. 

>> Thank you Mr. Chairman. I just want to note this is a very significant meeting because it is the last meeting that Casey Morgan human is going to be on our payroll and here in attendance. Casey's been with the agency for almost ten years. Spent most of that time working in the office of general counsel and spent a lot of time here assisting commissioners. Most often me. In getting our work done. When she was down in OGC Casey was a go-to person. All the managers knew if they had a particularly challenging and complicated case, Casey was one of the lawyers they could always go to and know the matter would be treated with diligence. And thoroughness and intelligence and the analysis would be spot on. And I value those traits as well when she worked in my office. She also downstairs played an important role mentoring interns and new attorneys because she is caring person and she cares about this agency and its mission and the people who work here and I value that about her too. She's leaving us to go work at the Department of Education where she's going to also be working on important enforcement matters going after diploma mills that are looking students out of their hard earn ed tuition payments. We are happy to see that she's going to continue in her great career in public service and wish her well but I'm going to miss you, Casey and I know many, many people in the building will. 

>> I just want to add to that. Will miss you as well, Casey and obviously you haven't worked with me quite as long as you have either for the agency or for Ellen, but your advice, your breadth of knowledge about issues and your balance, your approach to things that was thoughtful and very sort of fair. It, unbelievably internp helpful in helping me to form my views. There's always sours. 

>> Thank you, I'd also like to add my thanks and appreciation and wishes for the best. She worked for the three of us for most recent period of time for the three commissioners and part of her job was to try and work and amill rate areas of disagreement on ongoing projects. So that by the time they came to us we are talking about the nub of the issue rather than some of the issues that seem to detract from what we really need to get done. She worked really hard at that and it's a tough job because it's sort of a new approach to do things and it's a good example for us to keep on going so we will miss you and thanks. 

>> I would echo the remarks that my colleagues have stated and wish you all the best and thank you for all the service you performed here at the agency. I'd also just like to mention that in the interim between our last open meeting and today, we had a departure at the agency. Dan who is actually here with us today. The last time we met he was up here as acting general counsel and since that time transitioned into private practice and we haven't had an opportunity to properly send him off in a public setting and I just wanted to thank Dan who was the head of the enforcement division in the office of general counsel for several years and as I mentioned has been our acting general counsel for the last while as well. His leadership was much appreciated. His calm demeanor and level headed advice was always greatly appreciated and we greatly miss him at the agency. We wish you the best now that you've opened a new chapter in your career. I want to mention that as well. Commissioner Weintraub -- 

>> I wasn't prepared to say anything and I will also echo what the chair said but I also have to say that Dan exemplified a truly extraordinary general counsel. I mean, he had all the qualities that make for excellent, thoughtful, balanced advice as well and I really appreciate all the work that you did. Wish you the best. 

>> I think we have a motion for late submitted documents. 

>> Thank you Mr. Chairman. The first item on the agenda is the correction and approval of the minutes. I move to approve the minutes of the meeting of July 14, 2016 and August 16th in the agenda document numbers 16.37A.. 

>> Let's move approval of the minutes according to the motion of the vice chairman. All those in favor say aye do we have a motion. 

>> I move to suspend on the rules of agenda documents in order to consider the late submission of the following documents. Agenda document 16-40-A proposal to launch rule-making. Proposed statement of policy, excuse me, agenda document 16-41-A. Proposed national prohibition. For document 16-42-A for moving voluntary compliance. 16-43-A. Draft be on tech modernization. 16-44-A. Statement to rescind the 2006 TransCanada and make sure the spending is free from foreign influence. Document 16-43-B petition for rule-making on implementing the consolidated and further continuing act of 2015 and agenda document 16-35-B. Political party rules. 

>> We'll take a motion. All those in favor. Any opposed. That motion carries by a vote of 6-0. We'll next consider item two on the agenda implementing the consolidated and further continuing appropriation acts of 2015. We have Tony Buckley to give a presentation. 

>> Good morning Mr. Chairman. 

>> Please proceed. 

>> Thank you. Commissioners received a petition from the rule-making LLP law group. The petition asks the commissioner to adopt new regulations to implement amendments made by the act of 2015. The petition also asks for new regulations regarding convention committee. Also the general counsel has examined the submission and determines it qualifies under a new petition. Therefore we have drafted a notice of availability whether they should make new law making in the proposal of the petition. 

>> Thank you for that presentation. Are there any questions? 

>> No questions, just a comment about this proposal. 

>> I believe this proposal and the item that is next on the agenda echo a discussion this commission had several months ago where commissioner Weintraub raised the issue of the new accounts of the national parties and the possibility of putting some parameters around the proper use of those funds. I think at that time there was bipartisan support for investigating that. We didn't do it on our own volition but we have this perhaps as a vehicle to inform what we might want to do. And so I see this as quite a constructive vehicle for the commission to receive comment about how the parties have used these new party accounts and consider how they might do it in the future. I would note one change from the draft that office of general counsel originally submitted to us and that was just to extend the time for comment we also discussed that when this issue last came before us. Which was that our state party and national committees are overloaded national elections. After that you have turnover at many party organizes and then a holiday season and an inauguration. I think this will give ample time for all parties to consider whether they want to submit comments and to do so. And I look forward to hearing those comments. I think we will also by January 30th, the comments can be informed by the actual experience of the parties in the first election cycle using these accounts and I think that will be useful predicate for us if and how we proceed. 

>> Is there any further discussion? 

>> I would line to -- like to talk about the timing I think this is great that it's been it submitted. And I'm happy to support it. It's two years after the budget cycle when the issue was first raised and we've been talking about it since that time. And it would have been better, I mean, I agree with you, I'm okay with having it now and the comment period after the election beginning of the year but it would have been so much better had we done something on this topic prior to the election. So with that, I am of course going to support this. 

>> Any further discussion. 

>> I move that we adopt the notice of availability draft B as presented in the document today. 

>> With a motion on the table any discussion on that motion if none all of those in favor indicate by saying aye. Any opposed? Madame secretary that vote carries by a vote of 6-0. Thank you Mr. Buckley. Yes, commissioner Weintraub. 

>> I wasn't going to say anything about this but let me just flag one issue that I think would be particularly beneficial for us to get public comment on. When the -- when Congress passed these new provisions and gave the political parties all the extra money they designated all this money for specific purposes and there has been discussion both within the commission and outside as to whether once the party committees raise the money into those accounts, whether they can then move the money around anywhere they want to or exactly what they can spend the money on once it comes in the door. I would encourage any commenter s who see this notice out there to weigh on this issue I think may be one of the most significant ones that will come up in the course of the upcoming, hopefully, rule-making. 

>> Okay. Commissioner Goodman? 

>> Not to prejudge the petition of course. 

>> No, I'm just asking for people to comment on the issue, on the question. 

>> Okay. 

>> We'll turn next to item three on the agenda which is reg 2016-03 political party rules. We have Joe Wenzinger to give us a presentation and I'm informed this is your first time presenting here. So no pressure. Big audience. News cameras here. 

>> I'll just read -- 

>> I think commissioner Goodman may have a series of 20-25 DER rogatories so we'll make sure this is a memorable one for you but welcome to the commission and pleased to have you here with the commission. 

>> Thank you Mr. Chairman and good morning commissioners. On June 215, 2016 there was the farmer labor party that asked for federal funds to pay for activities for state, and local committees of personal party. The office of general counsel has examined the submission and determined it qualifies under 11 CFR 2.2B therefore we have DRACHTed a notice of availability seeking comment on whether the commission should initiate a rule-making on the proposal in the petition. Thank you. 

>> Thank you for that presentation. Is there any discussion on this matter? Commissioner Goodman. 

>> Yes, thank you Mr. Chairman. Hope springs eternal and I think that's what this petition represents. A little over two years ago this petition held a forum to hear from state and local political parties the national parties were represented too but I believe the people who participated most vocally were representatives of state and local parties. Republican, democratic and I believe even the working families party of New York was in attendance. And they all expressed concern about how our regulations impact the operation of state and local political parties. And I would just like to highlight for the public some of the material that has been presented to us in this petition. By the chairman of the Minnesota democratic party and his counsel Mr. Reef. This petition lays out a predicate for the concern out there. And it talks about how state and local political parties play an important role in our political policy by pursuing political parties that a majority of Americans support and these culpable mental state tees are well situated to form grassroots political parties which can help to ensure consistency and cohesion in party goals. While it used to be common practice for state party to pay for communications featuring candidates from the top to the bottom of the party ticket, these are now largely replaced by single candidate communications and only when the party is able to allocate their scarce resources to the cause. It goes on the to say that state parties will increase voter turnout such as voter registration and get out the vote. And that our regulations have strapped the hands of state and local political parties. Limited their ability to perform these functions. The petition strikes I believe a hopeful chord in the end. That following the forum of 2014, they hope that we could reach some bipartisan consensus to help all political parties and this I believe inherently if we do receive comments and are moved by them I believe that this and perhaps in combination with the petition that we've just put out for comment could form the basis for a comprehensive party rule-making next year. And so I'm looking forward to hearing the comments and response to this notice of availability. As you know, I do start with opinions about that. We've discussed them but I'm going to keep an open mind on this petition and look forward to receiving these comments. 

>> Any further discussion? If none, do we have a motion? 

>> I move that the commission approve agenda document 16-35-B draft B. 

>> On that motion, call for the ayes and nays. All those in favor say aye. Any posed? Madame secretary, that vote carries by vote of 6-0. Congratulations for bringing unanimity on your first try. So -- next item is item four. Reg 2013-01 draft notice of proposed rule-making on technological modernization. We have Jessica Selinkoff who has done this work thus far. We will not be voting on this today. We have two documents that have been made below. This is an agenda item that's been on the last three or four open meeting agendas without documents. I wanted to put the first document that is on the agenda is the original draft that was considered was that December? November. Draft B is the more recent, working draft, I'm not saying that it's the final draft but it's a draft that indicates some of the direction that we've been heading towards. There may be further modifications. I think there's been good progress amongst all the offices in pushing this forward. It's going to require a little bit more time to get it across the goal line but I'm hopeful by the next meeting in two weeks we'll be able to do so and so at that point, Miss Selinkoff you will truly have your opportunity to have a star turn and see it come to fruition so we will hold this over to the next meeting of open commission. Next on our agenda is item five which is promoting voluntary compliance. This is the agenda item here is a memorandum from commissioner Caroline Hunter. Madame secretary is there a sunshine notice that needs to be read before we consider this? 

>> Yes. 

>> I move that the commission add to the agenda the consideration of one proposed -- promoting voluntary compliance to proposed statement of policy on the application of the foreign national prohibition to domestic corporations owned or controlled by foreign nationals in free statement to the advisory opinion 2-6-TransCanada and to open a rule-making that the U.S. political spending is free from foreign influence and that the commission continue as far as section 2.7B and that no early public announcement was possible. 

>> The vice chairman has presented a motion all those in favor indicate by saying aye. Any opposed? Madame secretary that vote carries 6-0. The next agenda item is a memo from commissioner Hunter and I will turn that over to commissioner Hunter. . 

>> Thank you Mr. Chairman, today I would like to talk to a (audio fuzzing) who is the head of our reports analysis division and they spend a lot of time and energy, working with committees to file to make sure they are also voluntarily complying with the law. So while we already do a lot of things it's sort of occurred to a few of us that this might be a good idea to have the commission come together and hopefully highlight a few, just a few points that are most relevant to a citizen who may want to be engaged in the process. So the target audience here isn't lawyers or the regulated committee who already are on all of our LISTSERVs and frequent our website. It's more people who are interested in contributing to a federal candidate who may want to put up a billboard or something on behalf of their favorite candidate. We have a whole book of regulations, tons of AOs, Murs and all that so distilling that into four bullet points was not easy. But we tried to pick the ones that were the most relevant to the people sort of out there. That they should know about. Just really quickly to talk about each of them in turn. The first one protect our elections from foreign influence. We're going to be talking about that later this morning. Everybody agrees that foreign nationals cannot participate in U.S. elections and believe it or not there are some instances we see where people don't realize that so we want to make sure that the public is aware that they are not permitted to participate in elections at any level of the government federal, state or local. With regard to staying within the dollar limits we picked one and said the individual contribution limit for this cycle is 27 00 dollars you probably all read in the news a lot of small donor contributors don't know that and they keep contributing over and over again not realizing there's a limit. The campaigns most often catch that but this is an effort to let the public know one example that comes to my mind is an elderly woman who every time she got a solicitation from a party committee wrote a check and had no idea there was a point where she was going to come into -- that there'd be a problem with complying with the federal law so we felt that might be an important. There's the name of another. Obviously most of the people in the room understand that. You can't write a check for your favorite candidate and by reimbursaed by anybody. After I talk about this prohibition someone said I'm the treasurer of the state campaign. I was talking about state and federal laws and she said we had no idea this was a violation and they've been doing this for months and months and she was horrified and said we'll have to fix our reports and all of that. We know it's not intuitive for some people that you're not allowed to give money. It's not yours. It can't be reimbursed. The last one keep your political ads independent. This one is particularly tricky to write. You could probably write five pages on this but trying to distill it. One of the main reasons I wanted to put this one in here is you have to have a disclaimer for independent expenditures and by way of example there's a very large billboard right around the corner from my house right now where somebody says so and so supports one of the presidential candidates and there's no proper disclaimer and it's not the end of the world but that person clearly doesn't know that there is a requirement to have a disclaimer. So I just sent this around to my colleagues yesterday and have spoken with each of them either directly or indirectly and look forward to their comments. They haven't had a chance to really study it so we'll hopefully be able to come up with some language we can all agree on and a couple of ideas and I'm open to more. Perhaps we could submit something like this to various newspapers across the country as an oped signed by all six commissioners and the idea would be to get to mid level newspapers or smaller ones throughout the country. Maybe we could publish something in USA today I'm hold that's the most widely circulated newspaper in the United States. It's in a lot of hotels. Somebody had an idea of doing a video we could post on our website. I'm not sure we could do that. 

>> Can we hire actors to play our roles. 

>> We should definitely have doubles and Greg Scott said he's willing to help putting it on the website in a place that would be appropriate or sending it to a very useful list and somebody else had the idea if we send it out to your list, GRESHG even though a lot of them know about this they may be inclined to forward the information to their donors or their LISTSERV. These are some ideas and I look forward to working with my colleagues. Obviously the election is right around the corner so we don't have a lot of time. 

>> Is there any discussion on this proposal? 

>> Thank you and thank you, commissioner Hunter I think this is a really good idea. And I totally agree with you that one of our most important roles is to provide information and, in particular, to the citizens that are engaged in the political process. I certainly support it. I was interested this morning in receiving Dwyane P's note of some potential additions to this and I'm glad he did because it raised an issue that I think is really important and we've seen as very important in this particular election. And that is the problem of so-called scam packs. When people are making contributions to entities that represent themselves. As actually working for a particular candidate or committee and not -- and so his suggestion I think is really good one and an important one to add to this. Because this is part of who you said is the purpose is to inform citizens engaged in the process. I know we have yet to sit down and talk about the issues but I wanted to voice my strong feeling that that's a really good addition. 

>> Sure, happy to talk about it. Happy to work with you. Just so the public knows this suggestion, if this is not the one you're referring to. Dwyane suggested adding -- you can also find the authorized campaign committee of any campaign you would like to support and that's a helpful suggestion. We were trying to get to that in one of the lines here but happy to add that. If people want to know who is soliciting them they can go to our website and get more information by looking at that campaign's public filing and I agree with that as something to add. 

>> Commissioner Weintraub. 

>> Thank you Mr. Chairman, I also think this is a good concept. As commissioner Hunter knows I was talking the we are a few days ago. About whether this was anything that we could agree onto move forward on an issue that some of us have been trying to get on the agenda in a productive way for months or years I said maybe we could put out better information to the public so everyone understands the prohibitions and she said funny you should say that and I'm tickle ed that the first thing on the list is protect from foreign influence. I would hate to think that anybody thinks these two sentences are going to accomplish that task. But we'll have more discussion on that later on the agenda. Don't give in the name of another I would think we would want to add don't accept money from somebody else who wants you to make a contribution. There's two sides to that transaction. So I think there's some wordsmithing that need to go on and as commissioner ravel pointed out we may have suggestions for other top topics that we want to add in. I think it's a terrific idea for us to be more proactive to make sure everyone understands the rules. It's surprising how many people show up on our enforcement docket saying, oh, I didn't know there was a rule against that. 

>> Is there any further ditz -- discussion. I think this is a very constructive suggestion from commissioner Hunter. As she mentioned our information division lead by Greg Scott does a great job educating through conferences. Through literature and web presentations and so forth. And anything we can do. Any ideas that can educate the public as to what is permitted and prohibited is can -- can only be to the good and hopefully we can move forward on suggestions that have been discussed. Mr. Vice chairman. 

>> Just to add my appreciation that it's great. Take the initiative. It's a good start. 

>> Next item on the agenda. What is listed here is item six has been resolved offline. So we can move past that and move to item seven on our agenda which is a proposed statement of policy on the application of the foreign national prohibition to domestic corporations owned or controlled by foreign nationals. This is agenda document number 16-41-A and I will open that up to discussion in anyone wants to or we can move past it if no one is interested. Commissioner Goodman. 

>> This document is a response to a discussion raised by commissioner Weintraub in her forum. You raised the issue and it needs to be stated quite clearly at the outset that I think, you know, and I'm a provincial kid from a small southern city we all agree with Congress's judgment beginning in 1966 that a foreign national shouldn't be contributing to our campaigns for office. We all agree with that and I went to your forum. I was listening for both legal framework ideas for that and I was also listening for evidence that we have widespread circumvention of the rules. I want to let you know though that you did spark both with an open mind you sparked a lot of study and analysis of this issue by me personally. I had, as a private counsel advised many people on the extent of rules and how to comply with those rules but it did require deeper thought and I credit you with bringing issue and trigger that deeper thought and what you're seeing at least from my perspective, a proper way, how we address this issue of applying the foreign national ban in a modern economy where there are many mixed business associations and U.S. corporations increasingly owned in part by foreign companies and I look at it all with a fresh look. I had never really taken until you called this to our attention, I had never looked at this and thought more deeply, from 1966 until now, what the foreign national ban means. And how to apply it in an increasingly complicated economic system. So but one of your experts I think identified the issue which was you have to identify specifically what you're trying -- what the subject of your restriction is and what you're trying to prevent and tailor any regulatory scheme to that issue. I think you may have defined the problem, the legal issue that we're trying to address more broadly than I have but I want you to know that I listened quite carefully and so I think where we diverge a bit if I understand your New York Times piece is in the how. Is in the how to go about it. So congress, the proposal before us heeds the lines that congress has drawn for our agency. Congress has drawn certain lines by defining the term foreign national quite specifically. That -- those lines have been rewritten over -- from 1966 to 1974, then came the Clinton DNC scandals of 1996, and then in 2002 they redrew the lines. The commission reacted to that in rule-making in the Bic RAL rule-making in 2002 and did a very deep dive in what congress intended to target here. Where did Congress draw that line and this commission analyzed quite carefully the issue of U.S. domestic subs and the complicated relationships with foreign parent corporations. So now then Congress has been fully apprised of all of this many senators wrote this commission in 2002 in connection with that rule-making and and gave us comments and tole us where they want to draw those lines and they were quite explicit about what they intended with respect to U.S. subsidiaries. In the disclosed act of 2010 after the citizens united ruling, Congress considered redrawing those lines again. And did not pass redrawn lines. And in every subsequent iteration of the disclose act it appears that Congress has abandoned an interest if you read a propose -- an act that's proposed as congressional intent. They have not revisited this issue of redrawing the definition of foreign national or the word indirect. Which was the Bic rah change. So I listen carefully at your forum knowing that we don't draw on a blank slate these lines have been drawn by congress, very conscientiously and amended. 

>> . In trying to answer the question within those parameters at the statute we have, what are we trying to address? I was struck by one of your experts that you called to your forum and it was the legal panel with the dean. Was there a Mr. Coats on that panel? I apologize for not knowing the names because I have the transcript and the transcript doesn't always tell you who's talking so I apologize for not knowing who precisely but I was impressed. It was in the Q and A where some of these issues got crystallized in my mind. So what one or two of those experts said was that the real focus of the commission or the ban in dealing with these complicated corporations is not ownership of the corporation. It is on control. And I will read the passage that struck me. I remember it was the gentleman on the far right. 

>> Mr. Jackson of Columbia. 

>> I remember that. After discussing the difference between ownership and control in response to some of your questions, one of them said this, I'm not sure how -- It was -- he was discussing ownership and whether individual shareholders owned each dollar in the corporation you may remember that question. And he said, I'm not sure how much that tells us, the ownership of the assets of the corporation. About whether the money in the corporation is foreign money. So to speak. Here's why. For me, what we're more interested in is the subject you asked me about and we've been discussing which is control of the corporate resources. And for the reasons professor Coats gave one percent ownership in a corporation could yield a certain amount of control. And the way to think about this I think is that the corporation is a box with these resources and the question is not who the money is. Not to trace it back. The question is who decides what happens with those resources? So there are two ways to skin that cat if you're -- if the issue is control. Because ultimately, it's the control, the expenditure that has the greatest potential to influence either the listener, the people of the United States or the politician, depending on which side of the coin of the influence that you're concerned about. Now, 40 years of law here at the commission has focused on the control issue. By restricting who decides how to spin the corporate resource. Who can participate. There's even a prohibition on any foreign national influencing someone else's participation in politics. And it's at that level of control over the actual expenditure-specific control that 40 years of press didn't here at the commission has focused on. Now your article in the New York Times seem to argue for a broader definition of control. It's the blanket control of the board of directors at fiat that oversees Chrysler in Detroit and I think that's the fundamental debate if there is to be one you haven't told me what you think about our proposal here but to me when I compare your New York Times paradigm that you articulated there versus the one this proposal focuses on that's probably the fundamental difference is at what level of control are we going to apply this foreign national ban in the context of U.S. subsidiary corporations that are owned by in whole or part by foreigners and so what this proposal does is it takes 40 years of commission precedent that Congress has been well apprised of and seemed to countenance, with the BICRA and subsequent letters this commission received. And this proposal says absolutely in the context of a U.S. subsidiary, making either independent expenditures or contributing to a Super PAC that's going to make independent expenditures or electioneering indications there can be no foreign national who participates in the decision to spend that money. And that's the level of control at which focus at that specific level. And it's a very tailored approach to this foreign national ban and, secondly, with 40 years of history on this it can't be foreign money. It has to be Chrysler's money earned from Chrysler's revenues and profits in Detroit or Ben and Jerry's money from the U.S. since it's owned by Unilever. Otherwise Ben & Jerry's, U.S. companies, do not meet the definition of national in and of themselves. So how do we control the foreign national influence? They use American money and Americans make the decisions on how that money is spent. So that's point one of this proposal. It makes very clear those restrictions. And, secondly, this proposal provides a certification mechanism finish treasurers of super PACs and carry funds who accept for-profit donations. Or contributions from U.S. subsidiaries of foreign companies for them to be to ask the question that forces everyone on the key issues so there can be no mistake. No misunderstanding and it provides that a certification mechanism which you've discussed, and we all know that safe harbors have a way of driving a lot of conduct and so that is the mechanism through which we would draw greater attention and compliance with those rules. So that's the proposal before us. And I share this proposal with the chair and commissioner Hunter. I'm sure anybody would be happy to answer these questions. 

>> Commissioner Weintraub. 

>> Thank you Mr. Chairman. Well I have to say I am really delighted to see your proposal. I am really excited that you guys are willing to engage on this issue. Commissioner Walther and I have been trying to get a vote on U.S. nationals ever since citizens united came down. And we tried three times in 2011 and as commissioner Walther's credit points out we had a very detailed proposal back in 2011 a series of options of how to address the foreign influence through corporations and commissioner Walther had a large hand in crafting those proposals so I want to -- And to give further credit where credit is due even before citizens United commissioner Walther was at the forefront of expressing concern on these issues. We tried in 2011 to launch rule-making on this topic repeatedly. And I think 2012 we were presented with an AO from Yamaha. A domestically owned subsidiary of a foreign company and it became clear at that point that there was no consensus of the commission of how to deal with wholly owned subsidiaries. We split on that AO. I, you know, I just say this for the benefit of the lawyers out there folks who are out there advising their clients. Based on law that predicts citizens unite ed and not reminding their clients there has been further discussion since then are doing their client a disservice. Because it's been clear since 2011 and again in 2012 that the commission has been splitting on these issues. That there is no long aeroconsensus. -- longer a consensus. In 2015, commissioner Ravel and I presented a petition to the commission. Which was subsequently withdrawn when some private citizens including public citizen whose key employee is out there that raised another petition of national foreign influence and you remembered -- urged the commission to do an action. We got almost 12,000 comments from those petitions that said yes, go forward and do this rule-making and we still couldn't get four votes to do it. So I'm really glad to see people finally engaging on this topic. Earlier this year I wrote an oped, took a new look at citizens united and how it views the political rights of corporations really as vindicating the rights of the individuals behind these corporations. Not that corporations have political views per se but that the people behind them do. And the court made that even more clear in the hobby lobby case. The case about religious opinions. Which plainly corporations don't have and the court of 2014 said in that decision it's important to keep in mind that the important of this fiction, the fiction that corporations are people, is to provide protections for human beings. A corporation is simply a form of organization used by human beings to achieve desired ends. An established body of law specifies the rights and obligations of the people including shareholders, officers and employees who are associated with a corporation in one way or another. When rights, whether constitutional or statutory the purpose is to protect the rights of these people. So we have to get back to who those people are and whether they have the rights that are protected. What we have now as my colleague pointed out I wrote an oped on this earlier this year and at the invitation of the chairman I convened a forum in June where we invited a bunch of experts and I really appreciated that from the chairman to do that. I was hoping bringing all those folks here would help stimulate some discussion and get some good thoughts going and I appreciate that everyone showed up and listened and paid attention I do appreciate that. What we have seen so some of us have been working in the salt mines trying to get this issue going for a long time and I think it has become particularly urgent this year. We've been seeing over the course of the summer the revelations the extent the foreign nationalists are willing to go to muck around in our elections. Last week in the Washington Post U.S. law enforcement agencies are investigating the Russian way to sow public distrust. CBS news article came out more recently. The ultimate goal of the hackers is not necessarily to change the outcome of the election. Their main objection is to delegitimize the outcome by sowing doubt, through a series of cyber attacks. An expert was saying the hackers are trying to undermine the trust in the electoral process. Earlier this week a hearing was held convened by chairman John McCain of the armed service committee. He invited generals to come and testify and in the wake of that he wrote a letter to James cony saying at a minimum these letters serve as a warner. Yesterday at a hearing it was confirmed we pursue an activity of concern through cyber means unfortunately these are not isolated incidents. In the midst of an election year the events in Arizona and Illinois likely show the intent to steal information, manipulating data, damaging public trust and understood -- undermining the integrity of our elections. This must be treated as a threat to our national interests. That was Senator McCain. This has been on the back burner for a long time and suddenly it's been a lot issue and one I think that does require us to take it very seriously we got a number of suggestions at the forum. One of our witnesses was talking about how, you know, we used to say back in the 50s, what's good for general motors is good for the nation it's not so clear anymore in this age of globalization where U.S. companies have foreign interests and foreign interests have ownership in U.S. companies. Some of the statistics on that which professor coats provided to us opened my eyes. He stated about 12 trillion dollars of assets, 12 trillion dollars owned by U.S. companies were controlled by foreign owners. That is 51 or more. Controlled by foreign owners. Back to 1982 about 5% of U.S. corporate stock was held or controlled by foreigners. Now it's up to 25. So there's an awful lot of foreign money in our businesses. And as one of our witnesses at the forum also pointed out, people are not immune from understanding what their bosses want them to do. There's all sorts of discussions that take place between domestic operatives even United States citizens who are running domestic companies and the foreign bosses who ultimately will decide whether they keep their jobs and what's going to happen with that domestic subsidiary. Influence can be and suggestions can be conveyed in all sorts of ways I -- when you hone in on specific decisions about specific expenditures it kind of reminds me of some of the debates we've had over coordination and how it's been the position of half the commission that unless someone hand picks an ad then we don't have to worry about whether there should be any donor disclosure. Whether that was coordinated because it has to be that specific a connection. I think there's all sorts of ways that a foreign owner can convey their views of how they would like things to go in the U.S. without hand picking an ad or dictating the exact words of that ad and I am a little concerned when you talk about that that that's the level of specificity that you would require. I am delighted to see the acknowledgment in your proposed policy of pages 10 and 11 that we really have not done anything post citizens you -- united. To clarify the rules. A lot of activities post citizens united because as you said all U.S. corporations were prohibited from making expenditure s in connection with federal elections prior to these developments. The commission was never formally clarified how the national band is by domestics corporations owned and controlled by foreign nationals. I'm really delighted to have that acknowledgment and to have this momentum for trying to provide some of that guidance. I will note that there's reference to, in here to contributions to super packs I think or independent expenditure only. And we have yet to define that term formally in rule-making here so we can put that on an agenda for a later discussion. When we held our roughly the same time as your forum professor tribe of Harvard put out an oped in the Boston Globe and we have copies of it out in the lobby area if you missed that. About how the Saudis have obtained a large share of Uber. And are using -- and now UB er is getting involved in much more political issues. Spending millions of dollars at times. There was an article in the New York times recently and professor coats lewd -- alluded to a Chinese corporation that has been buying up a lot of corporations -- and banks. In the United States they tried to buy an insurance company and there were some disclosures that were required as to who their owners were and they reVUZ to do provide them and as a result we're not allowed to buy an insurance company in the United States but they have other holdings and those would be able to make expenditures in U.S. elections. We had a number of suggestions from our panelists in June about possibly using 5% foreign ownership threshold which is something that crops up in SCC law as in addition with someone with a significant interest. And potentially a controlling interest. The ability to control what goes on in the corporation. As a potential issue. What I've been trying to do is launch a rule-making that would consider all of these ideas and I am delighted to see that you've put some on paper this week too. And I think they should be incorporated into the rule-making as well as the ideas that commissioner Walther had a hand in 2011 as well as somebody that other ideas from the forum and my oped. I think the notice of proposed rule making that I would like to see should incorporate all our ideas for that. And should provide an opportunity for public comment where if we adopted a policy statement today there would be no opportunity for public comment on that and I think that's one shortcoming of your proposal. The policy statement itself states at the end that is not binding on the commission. So because if it were binding on the commission it would have to be a rule-making. It's a not so safe, safe harbor to put out to say well, we're going to tell you this but we're not really bound by anything we say in this document. Again, that's an argument for doing it through a rule-making rather than through a policy statement but I do appreciate you picked up this notion of certifications which I think can be a useful device for helping to - assure the American people that there isn't foreign money spent in our elections. That people aren't trying to use that venue to muck around in our elections. And that there isn't foreign control over some of the spending going on whether or not they are hand picking ads or specifically dictating I want you to spend X number of dollars in this race as opposed to some more generic, gee, it would be good for business if this candidate won rather than that one. So I'm not going to be able to support the policy statement you all put on the agenda today but I would be happy to be able to support a proposed rule-making and adding it to other options that we can put out to public comment to reach some consensus going forward. 

>> Commissioner goodman. 

>> You covered a lot of ground there and I understand you feel passionate about the issues. Some of the issues you raised we can probably discuss on the agenda item with your proposal but I do want to respond to one point you made about our proposal and I think that is a mischaracterization this commission has 40 years of precedent and copious advisory opinions. 

>> All of it predating citizens united. 

>> Some of it post dating. Including Mur 461 decided by 5-1 vote in June where this commission found no reason to believe that sub said -- subsidiary s and you to define no reason to believe in that case. Based on these principles that the U.S. subsidiary only Americans had made the decisions and only U.S. revenues of the American U.S. subsidiary was used to make contributions in Nebraska state races. I don't highlight that except to respond but my point is this, both before citizens united and after citizens united this commission and the Department of Justice have been fully capable of preventing foreign national involvement very generally. So the one, I didn't want to mischaracterization to hang out there or that perhaps I had indicated that this is an ad by ad determination. The foreign national ban is very broad. The foreign nationals involved in a company can have no role whatsoever in all of the American political spending of the American company. Only American citizens and the law is very broad. It goes beyond specific expenditure by expenditure decisions. It says they can't influence that political activity in any way and so I didn't want anyone to be left with this impression that our proposal is an ad by ad decision. The foreign nationals cannot participate in any way in the political spending of the American subsidiary corporation. I just wanted to be clear on that and people have gone to prison for that. Even American citizens who have assisted and facilitated foreign nationals in making contributions including law firms, hoe began and heart son right across town here have been punished by this agency for even assisting foreign nationals in doing this. So there is a very wide prophylactic zone both in a 40 years precedent before this commission and after. Thank you. 

>> Is there any further discussion on this motion? 

>> I just like to echo a couple of the things that were said by commissioner Weintraub. In particular, and first I want to say that I am happy to see that you are engaging on this subject and that you're trying to think through what would be the best way to deal with the problem of foreign influence. Which I actually think is more complicated than commissioner Goodman gives it credit for but I thought it was most interesting the provisions in your own proposal that make clear and there was a final clause that commissioner Weintraub did (inaudible) reference and it says the commission also has suicide never had occasion to apply the foreign ban regulation to the making of independent expenditures, electioneering and the foreign cricks by domestic subsidiaries of foreign nationals that part of the foreign nationals was by implication of the other. I think that in and of itself is enough reason to say that we need more than a policy. We need actually a rule-making. And of course you know I think that we have to clarify the law first by -- and we'll talk about this later, by rescinding the AO TransCanada which is probably what commissioner, she can speak for herself, I wasn't here, Weintraub was relying on when she voted the way she did. But we need to rescind that AO and engage in a rule-making. And particularly so that -- this was the other issue I have concerns about is that this policy just appeared on the agenda a couple days ago. And there's no opportunity for the public to weigh in. The public clearly is interested in this issue. It's a major concern. With respect to -- and I'll go into more detail about the public's comments on the AO revision but to date we received almost two thousand comments on that proposal. So people care about it. It's really important to the people of this country and it would be absolutely remiss and inappropriate for us to engage in enacting a policy without doing a PRM first. I think that's the most appropriate way to go forward and to provide clarity not just to the public but to those people who have to comply with our laws. 

>> Do we have any further discussion? Mr. Vice chairman. 

>> We have these items coming up and I'm not sure it's the best time to talk about some of these issues. I do want to give credit to the concept of the safe harbor that's in this. I think that's something we haven't really thought about to the degree that we could going forward. I'm not prepared to support the vote today but I think that it's an interesting concept to inject into the idea of how to deal with this increasingly complex issue. 

>> Do we have a motion. I want to make a few more comments. We're going to have a few more items on the agenda that will flesh out this discussion a bit more. One thing that needs to be made clear and not lost in this discussion as we talk about what is or is not the best approach for enforcing the foreign national contribution ban are the fact that millions of American citizens that their free speech and associational rights are part of this calculation. According to the latest numbers over six million American citizens work for corporations that are -- that constitute domestic subsidiaries of foreign corporations and as we consider those approaches that that can't be lost. The supreme court has spoken quite EL KWEPTly -- eloquently on the First Amendment for example the First Amendment case on campaign finance says the First Amendment protects political expression. The constitutional right of an association in Alabama stem from the course recognition that effectived a VEE KA si of both public and private points of view. Particularly controversial ones is undeniably enhanced by group association. The first and 14th amendments guarantee freedom to associate with others for the common advancement of political beliefs and ideas. There was another case that which were in the caption. FECV national conservative PAC from 1985 in which the court specifically held that the First Amendment freedom of association extends to PACs and notes that PACs are mechanisms by which large numbers of individuals with modest means can join together in organizations that serve to amplify the voice of their adherence so in this discussion let's not lose sight of the fact that our decisions are going to have an impact on the institutional and First Amendment rights of those citizens. The framework that has been in place for as commissioner Goodman for -- for almost 40 years. For basically as long as the agency has been in existence I think has been carefully calibrated to take into account the competing interest. The interest in keeping campaign finance system free of foreign influence and foreign money. While on the other hand allowing citizens who work for domestic subsidiaries the same ability to associate with their fellow coworkers that is afforded to U.S. corporations whose operations are based solely here in the United States. And so the one thing that as I consider this matter, one thing I want to make sure is that, you know, to borrow an old expression we shouldn't burn down an old house to roast a pig. There's still some evidentiary issues of trying to identify the full extent of the problem. I have no doubt that as commissioner Weintraub points out in her memo that she says it would be naive or you'd be looking through rose colored glasses if you didn't think there were not foreign operatives who were not trying to influence our election system in some way shape or form and I have no doubt that's the case but I don't think that's necessarily the issue. How are we going to balance the enforcement of the foreign national ban which we all share as we've, I think it's made clear in the discussion so far. There's no debate here at the commission. We're unanimous on that point and there's been a record of enforcement on that that precedes citizens you ^ night ^ niteed and occurred after as well and I think that has been the case with the Department of Justice as well. Which is vigorously enforced this. This is a debate between what is the best paradigm that both vindicates the interest of the national band while taking into the account the First Amendment freedoms of citizens that work for subsidiaries of foreign nationals. I was happy to sign onto the proposal that commissioner Goodman has discussed at length here. And his office took the lead on putting together. I thought it was an excellent piece of work not just in terms of the proposal but in terms of the history that this is not something that has shallow roots. The roots are fairly deep and go back many years but I also want to point out that the clarifications that are in that rule, reflect what's already in existing rules, for example, in one -- in 11, excuse me, in section 110.20 subsection I this is the this was added to the 2002 rule-making and reflects the ban. A foreign national shall not dictate, control, directly or indirectly participate in the decision-making process of any person such as a corporation, labor organization, political committee or political organization with regard to such persons federal or not federal election activities such as decisions of the making of contributions, expenditures or disbursements for any state or local offices or considerations of the political committee. This language preceded -- this was in existence prior to citizens united. There's nothing in citizens united which alter this in any way. Specifically the majority said we are not addressing the issue of the foreign national ban. And I just want to make clear that as we discuss this it isn't the case there are obvious gaps in the legal ban on foreign national participation through contribution expenditures in the statute and in the rules. As I said, this takes care of the direct influence as well as the indirect. So any discussion our suggestions that somehow that you can avoid explicitly seeking to get your company to spend in certain ways but you're going to do it through less direct means I believe that that is already covered under this provision. So I think that that needs to be kept in mind as well. But having said that, I do support the the proposal. I think it's a good -- certainly a good faith effort to try to find some common ground, some clarification. I don't think it changes the law otherwise we would need to have a rule-making. I think this clarify to the extend that there was any confusion, any ambiguity out there in the regulated community. So I'm happy to support it and appreciate the efforts that commission Goodman's office put into that document. 

>> Thank you Mr. Chairman and I'm very glad to hear you and the extent of walling off it that I believe is already necessitated under the law. I know that a certain amount of skepticism was expressed at the forum and I've heard in other places as to how much needs to be specifically stated before people who are responsive to their bosses who they be foreigners will get the message and it's worth noting that a number of foreign entities that do have ownership of domestic subsidiaries not only derive not only are they foreign individuals or foreign corporations but they're also foreign governments who are very much involved in their own economies and therefore in many of the companies that continuing to buy up assets in this country and that was, I think, one of the issues in the case was the ties to the people in high government office or very influential piece, the ruling class in China and so what extent they were controlling the operations. I would hope going forward that maybe we could get some agreement that a company that is owned by a foreign government perhaps would be one that we would look at differently than a company that is owned by foreign individual or a foreign corporation. You know, maybe that might raise the bar a little bit I think there's a lot of distinctions that need to be made in some of the precedence and discussions that the chairman just brought up. I think implicit in that whether we should look at distinctions between business corporations and ideological corporations. Because no one expressed political views and no one is going to feel disenfranchised their stock holdings, the company they hold stock in is not expressing political views for them because that's not why you invest this the stock market and some people are involved with pension funds and they have really sometimes no idea not to mention no control over what's going on with the money in their portfolios. But when you talk about, there's a distinction you want to look at between business corporations and ideological corporations where people do actually, the Sierra club, the NRA these are corporations but people do buy in because they want to affiliate with those political messages. In ways that people who invest in IBM or Microsoft or GM really don't. I do want to say though that corporate PACs do not generally operate like book groups. It's not like a bunch of managers are sitting around in the lunchroom and they say, hey, let's everybody throw a thousand dollars into pot and we'll decide which candidate to support. That's not the way it works maybe there's a corporate PAC out there where that's happening but for the most part management is haranguing the class to get money out of them and we had a case fair ly recently where they initiated high tolerance to extract that money from the solicitable class and get them to contribute to the PAC and the management decides who to support. I'm willing to bet that there are millions of Americans part of corporations where they get solicited by the corporate PAC who would be thrilled to death if by tomorrow those PACs were out lawed and they stop getting those solicitations. I'm a little bit less convinced that all of this corporate PAC spending is the purest exercise of people's First Amendment choices on who they want to support and who they don't. But I'm willing to take a look at and I don't know whether legally this could be a sustainable theory could be sustained but I'm willing to take a look at whether we want to draw distinctions between the expenditure of corporate PAC money that is provided by individual U.S. citizens as opposed to the corporate treasury funds that since citizens united have been able to be spent more directly on political activity. But, again, I throw that out as an idea that I'd be willing to explore in the context of a rule-making. 

>> Commissioner Hunter. 

>> Thank you and thank you also to commissioner Goodman for putting together this proposal and his office. I think it's an excellent con siration of law and I wanted to talk about something commissioner Weintraub side a while ago. Tell me if I'm stating something you said incorrectly that it would be a disservice if lawyers out there weren't telling their clients that since 2011 the commission has been splitting on some of these issues and that there's no long er a consensus. 

>> That is correct. 

>> And we've had this conversation before in the public and I actually think that it's a disservice to amend what the underlying law is. And I understand you don't like apparently the line of ad -- advisory pans that are in the proposal but that doesn't change that it is existing law. The only way to change that is to amend the rule-making. To have a rule-making on this. Because even if we were to get rid of the TransCanada advisory opinion we'd still have the ENJ which was program mull gaited in 2002 so from your perspective it's not the AOs that you seem to not like but the ENJ that was done after an extensive public notice and comment process. Including comments from Trevor Potter, senators Harry Reed and John who supported continuing to allow U.S. subsidiaries to have PACs and take money from U.S. citizens and, again, as commissioner Petersen and others have said there are stringent rules in there and, yes, we do believe in the law and the rules. We're here to support the current law and the current rules and they say that you can't participate in deciding where to spend that money unless you're a U.S. citizen and you're talking about the managers of PACs. My husband's going to kill me but he's one of those and he follows the rules and he asks me every now again am I allowed to do this or that. They're very careful about what they do. And they sometimes are people sitting around talking about which candidates they want to support because they support the issues that they care about. Things like regulations and things that we don't really get into but they are American citizens. I know a lot of them and they care a lot about what their government is doing. They're real people behind these decisions and yes, they can participate. Thank you. 

>> Commissioner Goodman. 

>> There is no further. 

>> One last comment from me. We were talking about the business corporations. I have to go back and look at the numbers but it strikes me the amounts of money that have been spent on communications thus far since citizens united are different from corporations. What has been the experience so far is that business corporations, when they've dipped their toe and either contributing. Aisle I'm not aware of any instances where they make indirect expenditures but there's examples where they contributed to groups that have proven controversial and subsequently there's been boycotts and bad publicity and the experience for many business corporations is that they want to stay away from that. As much as possible for, you know, one, not to drive away customers because as you say, at the end of the day when shareholders invest into a corporation they want a return. That's their primary concern so you don't want to drive away customers, anger shareholders. We both presented at a conference last week from the PLI. I always think of -- PLI? Thank you for reminding me what the acronym was and they talked about this issue. My experience I guess anecdotally talking to people that I know both in private practice who are advising business corporations and also those who are in-house is the extreme caution that they take especially if they're like in domestic subsidiaries to ensure there is no foreign entanglement because of the criminal liability that could attach. Now perhaps there are many others out there that are just reckless and are willing to push the envelope. That's just one person's experience but I -- at least what I've heard, what I've read has been more the opposite extreme is that the business corporations have been very cautious in this realm because they don't want to get entangled in a criminal enforcement action and as I said, at the beginning, I do think that they have participated less. Now I think there are individuals who own businesses who are wealthy individuals. I think those are the people who primarily contributed to the groups that have made the most of the expenditures so I think there might be some irony if we distinguished between business and id -- id owe logical corporations. 

>> That's a fair point but I guess there's -- then there's another category that I -- they're not business corporations. But they're not what I would call ideological groups in the sense of the NRA and the Sierra clubs where everyone knows what the agenda is. But what we've been seeing since citizens united in particular is a plethora of groups that, you know, the kind that Steven Colbert mocked when he said Americans are better tomorrow, tomorrow. Nobody knows who they are, nobody knows where they're coming from or significantly who is funding them. And hundreds of millions of dollars in dark money is being spent by these groups and really we have no money is coming from. And that is I think a place where I do have some concerns because we don't know where the money's coming from and because I think there are some fairly aggressive foreign interests out there who are looking for any avenue to, as I said muck around in our elections I am not completely convinced that all the money that is being funneled through those dark money groups is money that is legal to be spent in our elections. Yet another -- 

>> We cut you off the last two times, Mr. Goodman. 

>> I just wanted to make sure commissioner Hunter is giving her husband accurate advice. Mr. Chairman I would like to move adoption of agenda document number 16-41-A. a proposed statement of policy on the national prohibitions owned or controlled by foreign nationals. 

>> Is there any further discussion on that? If none all those favor indicate by saying aye. That motion fails by a vote of three to three with commissioners Goodman, Hunter and myself in favor and the others opposed. Turn to the next item on the agenda. If I can find my agenda which is now buried under a stack of papers. Which is commissioner ravel's proposal to rescind advisory opinion 26-015 TransCanada that is set forth in 16-32-A. I am assuming I will recognize you first, commissioner ravel. 

>> Thank you chairman Petersen. As I indicated before in the previous discussion and much of that discussion is probably applicable to the discussion that we're going to have here and I'm going to try not to repeat a lot of it but we have received in one month since I put this proposal on the agenda nearly 2,000 comments. Both from concerned citizens, some incredibly thoughtful and incisive comments that talked about some of the issues that we've discussed at the table the ranking member of the house ing administration committee. Lawyers, law professors and nonprofit organizations. And over 99% of those comments support my proposal to rescind the AO. And express grave concerns such as we've been talking about today about the influence of foreign nationals and foreign corporations. That they're having now on our elections particularly since citizens United. And, you know, you've already responded since I put this on the agenda with your own proposals. As I've indicated before. I think this proposal is a preliminary to the rule-making and need to be considered in tandem because it's very important before we enter into the rule-making which is so badly needed in this matter that we first clarify the law. And we know that while there has been discussion of this, perhaps even in a Mur as you indicate after citizens United most of what we have considered at this agency has been previous to citizens United. And based on old views that have absolutely no bearing on the present legal environment and factual environment that we're facing in this country so it's, I think incumbent on us. In fact, I think it's imperative that we revisit this and take a look at it and I want to echo something that I think there was a little distension about but that commission Weintraub mentioned about the fact that there's never been complete consensus even on this particular AO or on this view related to foreign subsidiaries in fact there's a lot of discussion commissioner Walter himself was a no vote on this AO but also Bob LEN heart has indicated a lot of concerns about the way that we have been looking at subsidiary -- for subsidiaries of foreign corporations because of the extreme difficulty of the issues of control and what control means. And in the real world, those subsidiaries are obligated to the owner. They are obligate ed to the owner so whether or not there is a person at the top who is saying you must contribute to my favorite candidate or not. By principles of corporate organization, where the fiduciary responsibilities lie, those subsidiaries have obligations to follow through on the financial and also in some cases political perspectives of the foreign owner. So militate for us to take a look at this again. And I need to say that this problem that we're facing and I know on one said of the table you like to talk about the constitution. And someone at the someone I believe at your very good African-American spoke about this and the United States constitution has recognized the danger of foreign interference in the immull you meant clause, a very well-known clause of the institution. Did you want to comment about that clause? 

>> I think I took an entire class on that clause. 

>> And it says, no person holding any office of profit or trust under them shall without the consent of Congress accept any present, immull you meant office or of any kind whatsoever from any king, prince or foreign state. And this this was explained the clause as to any em moll youments is found in a just jealousy of foreign influence of any sort and it's really significant that it says. Any present of any kind whatsoever that is a pretty strong statement and justifies the concern about having intermediaries or others actually being the donors in the case of foreign gifts. I think also it's important for us to look at the way the world is now with these corporations and I know Ellen spoke quite a bit about this but I think it's important for us to remember that we're really vulnerable to the influence from foreign nationals through their subsidiaries and the way that was totally unimaginable a decade ago. And so it renders I believe the prior consideration of all these moot and that have definitely undermined the assumptions that were part of the AO that we're considering today. First off, also, giving -- given our inadequate disclosure and failure to address issues of disclosure post citizen s united at this commission given what some of the professors spoke about with regard to the FCC. And the fact that there is not very significant disclosure as to the contributions, political contributions and other issues through foreign corporations. For us to think that we're actually capable, given that lack of knowledge that we have of DERPing whether there is this involvement of foreign nationals is not credible. It is not credible and I believe in the forum the great forum that Ellen put on, what Dean Donald who we talked about. He summarized it really well. I love this and I think I've even seen it in some of the cases that have come before us. He says, considering the existing rule that foreign nationals are prohibited from engaging in electioneering communication, in simple terms, a foreign individual could create a why YEEMing corporation. The Wyoming corporation could be the sole owner of a Delaware corporation that in turn could own a Nevada corporation. The Nevada corporation could then engage in independent expenditures on behalf of a candidate for those who don't practice corporate law I hope I picked the four most difficult corporate state to break the corporate structure. Because of Citizens United, your rules are now truly divorced from market realities. And several people in commenting on the proposal today echoed that same concern. One commenter noted the obvious problem in the commissions guidelines is that they ignore the reality of how corporate decisions are made. We should have no doubt and this comment is by Mr. Heel man who I believe is probably still here. We should have no do it that the campaign contribution decisions made by the American directors of U.S. subsidiaries would be influenced by the foreign owners of the company. Subsidiaries of an entirely foreign owned company are not likely to act in a vacuum. And make decisions about the company's money contrary to the wishes of the company hierarchy. So as I also mentioned the intersection of our rules not only with the FCC but the IRS means there's a significant disclosure gap. Professor John coats also noted in the forum one in four dollars in value terms in U.S. corporations is controlled directly or indirectly by a foreign owner. Now what kind of foreign owner? Well, we don't know. It's part of the disclosure gap. It could be individuals, it could be companies, they could be governments and of course, in many countries like China where governments and businesses are essentially identical and so a little hard to tease out even if you know the country from which the investment is coming. What more fundamental feature of our government is the protection of the rehub -- republic. Foreign interest are going to predictably diverge. And we also have to think about the rule and the AO in terms of the people who are supposed to follow it and tell their clients about it. And it is a major concern that lawyers are advising clients based on an oversimplification of these rules and presenting a system to their clients that is ripe for abuse. For example, a recent legal memo informed clients a U.S. subsidiary as long as it's charted is not a foreign national and may participate. This obscures the fact that foreign parents may exert direct or indirect control and many finance lawyers have said that the compliance regime presents a lot of compliance challenges. Alan for example, informs their corporate clients that aspects of potential direction or control can be more administrative challenging and that it's incumbent on each corporation to select a reasonable method for its own operations. In a comment, one of the other comments we received Noah has said it well. The FEC should recognize that legal and factual changes have rendered the current rules preventing foreign influence insufficient to the statutory comment and should begin modernizing them. And, you know, uniformly as I said people think that this AO needs to be rescinded and that we have to go forward with rule-making including ranking member Brady who said I fully support the rescission of ad -- advisory opinion 2006-15. Collectively these and the 199 highlight the need to clarify the status of the AO. And other AOs that purport to permit domestic subsidiaries of foreign contribution to make contributions or donations either directly or through SSFs in connection with federal state and local elections. So that we can give guidance to the regulated community as an important first step in enacting new rules. Thank you. 

>> Do we have any discussion on this motion? Commissioner Goodman. 

>> I read many of the comments. I didn't read about all two thousand I read a hundred. 

>> You read one hundred? That's a small number. 

>> They were very similar. I understand that American people don't want foreign nationals donating in their campaigns. I agree with that sentiment. So did Congress beginning in 1966 and we're debating here over how to go about implementing that policy judgment not whether to implement it. We, all of us here have voted to enforce the foreign national ban I think you and I are we had opportunity to vote on matters involving violations of the foreign national ban and we've done so. But there are questions raised by the politics signed by Alan D. and I guess he addresses his comments directly to your proposal and so I guess I would like to start with how do you respond to his procedural points? He says that there is a statute that says we can consider an advisory opinion within a few days and there's no procedural mechanism for ten years later for rescinding -- the rules in TransCanada were before the advisory opinion. I was curious why you started with 2006 when actually the opinion on which that advisory opinion began in 1978 so could you address the procedural issues raised in that comment? 

>> Yes. Well, and I also would welcome if counsel would want to weigh in because I consulted counsel prior to as I always do prior to making a particular recommendation. As you know every AO ends with a statement that says that it's premised on the facts and it says it in TransCanada by the way. The commission emphasizes that if there is any change in any of the facts or assumptions that presented and that such facts or assumptions are material to a conclusion presented in this advisory opinion, then the requestor may not rely on that. It's my view and I think it's others that these are material facts that they've changed. That -- just the enactment of citizens United since that time presents significant -- Anyway, changes as I've indicated before. And revisiting conclusion and advisory opinions is something we do all the time. It's something that we've done in the past. Last year by vote, six commissioners agreed to revise an advisory opinion in the report of i.e.s that run in multiple states in an interpretive rule. We didn't do that but we agreed to do that. So it's absolutely within our per view. 

>> So why didn't you propose an interpretive role. I'm just thinking of the procedural mechanism to rescind an advisory opinion that's been around for ten years. I think it's to go around to 19-20 back to 1978 if we rescind the whole rule but the proposal is to rescind one and its lineage. I guess I don't know that it's procedurally the -- procedurally capable of doing it the way its postured. 

>> Maybe we could -- 

>> Sorry, Mr. Chair -- 

>> I don't know whether your counsel are willing to weigh in on this at the moment since I received counsel. 

>> The key phrase in that request is at the moment. We've been consulted informally by numerous commissioners offices on this question. And we've given informal advice. The same informal advice to each commissioners office that has asked given that this is an open meeting I'm not sure that this would be a the venue to repeat it but if there is commission interest in a more formal we can give that. 

>> As far as you are aware, has there ever been -- has a -- an advisory opinion been superseded out of a subsequent advisory opinion or for a rule-making process? Has this mechanism as far as you know ever been used before? To rescind an advisory opinion. 

>> The example that commissioner Ravel gave almost fits that pattern. All were interested in propagating an interpretive role that would have given away that opinion. It didn't happen because of the disagreement as to the content of that INTECHTive role but as far as I know the commissioners were in aggrieve agreement that it could supersede in that advisory opinion. It couldn't happen. Before that I don't know. 

>> Commissioner Goodman, I believe you have the floor. 

>> Well, I am just struggling with the procedural mechanism that's presented to us. Which to the facts and assumptions stated an advisory opinion refer to the facts and assumptions presented by that requestor not that legislative facts, what's happening in the world beyond that might change. It has to do with the facts presented and the only facts that I've heard you present is one that Citizens United change -- maybe the legal landscape but it didn't change what TransCanada did. And Citizens United did not address the foreign national ban. I just don't know that procedurally we can rescind an advisory opinion that a party came and obtained through the procedural mechanism of rescinding an advisory opinion. Where the facts and circumstances for that requestor there same. 

>> I disagree with you. I don't think that the facts and circumstances and -- is seally related -- solely related to that particular person's situation. The situation has changed radically in terms of how applicable the law is and given that this commission is so unwilling to enact rule makings and we use AOs as substitute rule makings when in fact they should not be but they are used as presence precedence for others to follow I think it is particularly incumbent of us to look at this in the light of Citizens United and also the changing world in terms of multinational corporations. In terms of, you know, subsidiaries, American subsidiaries and the fact that the analysis in that case was aMRIBable to a different time and it should be revisited. ? Particular if we are planning to do an NPRM actually under any circumstances but in particular if we're going to do an MPRN so we have a clean slate. 

>> If the commission were going to undertake an NPRM we could clearly address this head on. It just seems that would be the most graceful way to do it. I have been know -- I'm not particularly persuaded by it. But going to, I am persuaded that an NPRM would be the proper way to do it not rescinding an advisory opinion and vaguely elude LTing to a wheel bunch of others that we are rescinding along with it. I believe that leaves some vagueness in the field. If we were to rescind this one and vaguely anyone like it. You would thereby remove the legal protections that all of those requestors obtained from their advisory opinions? Would that be the legal effect of the vote here to rescind advisory opinions? 

>> I think it would express what the commission has already expressed which is the validity of the reasoning of that AO. And so the -- those people who are engaging in this practice would have to think about what they're doing. 

>> While people are thinking about what their rights are in the wake of a motion or a vote to rescind, what's the extant law in the meantime because my understanding of what the law is, I will tell you what my understanding of the law is. It would be this regulation. Okay? This regulation that is explained in an explanation and justification that accompanied its adoption. You haven't moved to rescind that evening MRA nation and justification. And that explain nation and justification is premised on all of those advisory opinions. So even if you rescind those, the commission still adopted that reasoning on you in 2002 along with the legislative history of BICRA and all of the comments that came from senator Reed and others that said no, we're not affecting the rights of American subsidiaries. So I don't know what's accomplished there by other than adding some confusion to the field even if we were to undertake an NPRM would take time and so the law would be it seems in a vague state of flux as to the requestors who got advisory opinions but every lawyer out there would then default to the regulation as written. And the ENJ that explains it and so that's my understanding. Is that your understanding? 

>> That's probably correct and frankly for the brief period of time before we have our rule making and I'm glad to hear you're supporting the idea of an NPRM as well as a rule-making I hope, yes, we'll see. We have that situation in many of our places where there is a void of rule-making. Many. And so this would not be any different from that. 

>> Let me jump into getting more to the substance. Because you say that Citizens United and commissioner Weintraub said this as well was the game changer that changes our legal thinking on how to define foreign national under the act. Which in turn turn to the foreign agent registration act definition. Legally, Citizens United said nothing about that definition. I think we all had to concede. Citizens United said we aren't passing on the foreign national prohibition. Making the argument that Citizens United? -- somehow changed the political giving is only half true. While it opened up foreign nationals to make independent expenditures or to give to independent expenditures groups foreign nationals prior to Citizens United had given to the soft money accounts and to the state and local candidates and so foreign nationals and the definition of foreign national was well-established aside from CU. So why is Citizens United fundamentally was a game changer enforcing us to try to reinterpret the definition of foreign national in the statute. 

>> Can I ask a point of clarification because now I'm really confused I thought I heard you say earlier you all agreed the foreign national ban was broad and capacious and prevented the foreign national from doing anything and then I thought I heard you say maybe people were speaking, maybe a word got slipped. But I thought I just heard you say that you thought it was legal before Citizens United and presumably after for foreign nationals to give. 

>> What I meant was corporations and U.S. domestic subsidiaries. You're absolutely right. 

>> Interesting that you equate those. 

>> My point was that foreign nationals were prohibited to making those contributions prior to Citizens United although corporations could. Thank you for calling that. So corporations prior to Citizens United could make donations to the national -- the soft money accounts of the DNC and RNC as well as state and local. Citizens United changed where corporations could give into maybe a different area of politics. But it didn't fundamentally change the issue that the commission has had to address for 40 years which is corporations giving generally and trying to prohibit that activity of foreign nationals that much touch that giving. 

>> Yes, and I think you're looking at it a little narrowly, while that's true is that what didn't exist at the time I don't know what the commissioners saw at that moment but it's quite clear that the amount and the ways of giving has now expanded exponentially and that's where all of the comments comes in. Because people are aware of them, commissioner Weintraub spoke of some of them. Some of the concerns about, you know, countries, foreign countries that are associated with their businesses. You know, all of these things have changed since that time and that was occasioned by Citizens United and its progeny. That's the difference. 

>> Point taken. I understand that. I wanted to clarify that I think. Because I think the point is that while the amount of corporate participation has increased Citizens United didn't change the law. We're called upon to implement the law perhaps in a changed environment but the law is still the law. So how do we -- 

>> We also, let me add one thing which is because of the independent expenditures as I mentioned, the ability to funnel money from one LLC to another or from one 501C 4 or C 6 to another has changed for corporations and we do not have disclosure rules nor does there seem to be an appetite to have them either enact them or enforce them but we don't have the ability at the moment to determine whether or not that is foreign money. That's giving that money. 

>> The changed circumstances. The lay of the world out there. 

>> That's right. 

>> What do you make of the fact that Congress was fully apprised of the definition and the statute and of the commission's regulations and proposed to change that in 2010? Did not. And has not addressed changes in the foreign national prohibition since -- in all the subsequent federations of the disclosed act. What do you make of that? 

>> I make nothing of it. I actually make nothing of it. I think they had it there because there was a serious concern about this issue and there's a serious concern about conduits and intermediaries. They even enacted criminal sanctions for it. But there was not -- they were attempting to make a deal. On the disclose act and that's the reason, that's the only reason that it was dropped. And it does not -- and as far as I'm concerned, constitute legislative history to have you say that as a result Congress doesn't want, you know, think this is an poor -- important matter. 

>> It's not necessarily my point. Point taken I guess my point is Congress knows how to address this in the way of Citizens United. And if, if, Citizens United has changed the First Amendment tolerance for regulation based on your paradigm in the New York times that, you know, it's the ownership that constitutes then Congress ha Z had six years and has not done so. I don't necessarily read that as legislative history but it seem to me that because Congress has always been in the forefront of changing the definition from 1966 to 1974 to 2002 to a proposal in 2010, the definition right now has been static in the law since the Citizens United decision. And clearly Congress is fully apprised. So that's my point. 

>> Well I don't know how well Congress is apprised of the functioning of our commission. The point is irrespective of Congress we have an obligation. This is our job. We have an AO, we have a particular way of setting forth how subsidiaries can operate in giving contributions when they are subsidiaries of foreign organizations. It is incumbent on us I think to look at that and say, you know, that's not working. It's not working. It's not the right standard. We need to look at another way of dealing with what it is an acknowledged problem. That's all I'm suggesting. I'm not changing the law, I'm not doing any of those things. I'm saying let's say this is not an appropriate way for people to be able to shield these contributions. There needs to be more constraints and let's go forward with the rule-making. 

>> Okay. But you are changing the law. You -- 

>> No. 

>> You're proposing to change the definition of foreign national to a broader notion of foreign influence of money to be captured in our regulations implement ing that statute that says it's not what we intended. We don't draw a blank slate. And we're not the law unto ourselves. We make good on the law that congress has given us and the law that we have today is the law that Congress gave us in 2002 in the bipartisan campaign reformat and you're proposing to broaden out from that to regulate U.S. companies and the American employees of those companies. This is 60-70,000 Americans who work for Chrysler USA and thousands of employees who work for Ben and jerry's in Vermont and elsewhere and the other citizens who work for foreign companies and types and whatever. And so you are suggesting that we expand the notion or the definition of foreign national in a way that's contrary to what this law gave us in 2002. By the way I'm sympathetic. Citizens United changed a lot of activity. I guess the point that it didn't wholesale change because American corporations that were owned by foreign nationals were already participating in American politics but we don't write it on blank slate we are not a law unto ourselves. 

>> Even if your own proposal, which we both repeated, you said that because of the i.e.s, because of the other aspects of corporate giving now, it's a case of first impression. It's new. It's something that calls out for a new policy in your view. That didn't pass but, you know -- It calls out for us to revisit it. That's my entire -- 

>> Let me ask you this one last question Mr. Chairman because your proposal uses new terms from the statute we have prohibit s foreign nationals from making cricks contributions and expenditures and this broadens out the actual making of it. Your paradigm is to expand the notion to something called foreign influenced money. With this notion. So I guess turning back for a second to the comment that the center for competitive comment gave us. What's your reaction to pages 16 and 17? 

>> I don't have it in front of me. Sorry. 

>> I'll summarize. What their comment said. The proposal, this is your proposal assumes that U.S. subsidiaries and the U.S. citizens cannot be trusted and their loyalties cannot help but shift to their foreign owners and the comment is this is a cynical and unproven assumption with vast consequences. It goes onto talk about how all of us at some point are paid by maybe foreign clients if you're a lawyer. And that it suggests that we should not call into question the loyalties and have suspicion about the loyalties of the millions of American citizens just because of where they work. And so I guess -- and it is difficult to ratify a proposal that's based on that presumption and so I'm asking your reaction to this comment. 

>> Yeah, well, first off let me say with respect to the issue of those employees, I mean, these employees have the right to contribute to campaigns. There is not any issue about that. It's about the corporate sponsored PAC and there's no question that they as Americans or citizens with foreigners with green cards or all of the others, can participate in the political process. And that's what we want. It's the question of whether or not they can be influenced as Commissioner Weintraub talked about but also there is some evidence. There is a recent study put out and I believe one of the authors is from the University of Arizona. I can provide it to you offline where say said they found that political giving and political activity by employees is very influenced by CEOs of corporations. So there is evidence of that. And then just if you look at corporate structure as I referred to before. The subsidiaries, the employees they are all working for the corporation. The fact that they're a subsidiary. It's not an entity unto it. They are loyal to and must do what is in the best interest or perceived best interest by the CEOs of that corporation. That's the difficulty that we have in formulating some kind of a rule here honestly and why we have to look at what we have set forth in the AO as being incomplete because it doesn't actually address that problem. 

>> But focused on the separate segregated funds, when American citizens who work for Chrysler in Detroit donate their own money to the political action committee, under the umbrella, with the administrative costs paid by Chrysler USA, is it your position that the employees of Chrysler, when they give their own money to a political association, and make their own decisions about how to spend it, even if they are making decision about what's good for the auto industry in the United States, okay? What's good for Chrysler in the United States, now Chrysler is owned by fiat. Are you saying that we have to presume that those decisions are inherently disloyal to American interests. When they're making decisions for their own jobs for Chrysler and the auto industry in the United States? Why do we make that presumption in this proposal? 

>> I think that that's saying something that I never have said floor would I ever say. I do not in any way view this as a proposal that is based on disloyalty of American citizens so please don't try to mischaracterize what is an actually very reasonable proposal based on our experience which is that corporations have financial interests. They, when they contribute and when they set up, even setting up the SSFs asking their employees to contribute to what are the interests of the cooperation, it's done on behalf of the corporation. Not those individual employees. Those individual employees might agree or might not. We don't know. 

>> But assume they do. I'm sorry, I talked over you. Assume, because -- assume that the employees of Chrysler give to a Chrysler USA PAC. It's their own money. Their contributions are voluntary and even assume for the sake of this discussion that when they make political expenditures out of Chrysler USA PAC they are doing so given their economic interest in their employment at Chrysler USA which has plants across America. Probably 60-70,000 employees. Why would we take that right away from them. You did make the argument about fiduciary loyalties and where they lie first. 

>> That's right. 

>> And that's the comment before us. I take it, so that's why I said you're questioning their loyalty and whether their loyalty is an American interest or it's to Fiat in Italy. 

>> I think their loyalty is to the corporation. Through the senior leadership, the CEO and the senior leadership which happens to be a different foreign corporation. That's the rule of corporate law. That is. I'm not saying anything about loyalty per se of a particular employee. And, you know, frankly I think it's interesting that you're raising these issues because as commissioner Weintraub mentioned earlier in her discussion, you know, we had a case before us about PAC and contributors to a PAC who were clearly being not foreign but clearly being pressured to do something on behalf of the views of a particular head of that organization. And that didn't trouble the FEC, we split on that matter. You didn't think that it was within your per view. 

>> It troubled some of us. 

>> It troubled me greatly. 

>> Yeah. 

>> But, so, clearly there -- what's the avenue? What's the avenue for dealing with the problem that you seem to think is a problem of foreign involvement in our electoral process. 

>> I'm not sure that it is extinguishing the rights of American employee who is work for Chrysler and Ben and Jerry's numerous other foreign companies to assume under an umbrella SPON SORed by their employer. It is a separate -- it's not the corporation's money. It's a separate seeing yes -- segregated fund. It takes their personal money in and they make the decisions to take mare personal money out and there's no fiduciary view to Fiat in Italy. There is not because it's not the corporation's money. Now informally, I said, I grant you, the employees of Chrysler may want to vote the best economic interest of Chrysler and USA. They may indeed do that. But that doesn't necessarily mean that their interests are not in harmony with basic U.S. interests. So that's, I guess a fundamental concern I have about your proposal here today. So -- Mr. Chairman, I yield. 

>> Commission Weintraub. 

>> Thank you. Sorry, I -- there were many times where I thought about trying to interject myself but it seemed like there was no -- 

>> We were having so much fun. It was not a good time. Any what I was going to say my colleague said anyway so it eliminated the need but I just want to make a couple points. Point one, I support the proposal. Which as my colleague said, would kind of clear the decks in preparation for rule-making that I sincerely hope we'll be able to launch. I think this notion that these thousands of employees of Chrysler or any other big company are, you know, personally invested in and exercising their choice through the PAC, I think it's just not in practical reality how it works. Most of these employees who contribute to the PAC have no say. I don't know how Chrysler does it so I don't want to pick on them. But the individual employees have no say at all who gets the up many. That is determined by a manager who is often hand selected by the CEO who is hand selected by the foreign owners. So there actually is a connection there and as I said earlier, you know, we know that entities that are closely aligned with the government of China have been buying up companies in United States. We know the Saudis have been buying up companies in the United States. Let me give you the most dramatic example I could come up with. So let's just pause it for a moment. That three ISIS fighters who happen to have, come from families with money, decide to buy an interest or buy an entire company in the United States. Are you really comfortable with that company playing in our elections? You will be to -- willing to say, oh, that's fine. These are American citizens who work for ISIS so that's okay. They're the ones who are going to -- I mean, that's -- you can shake your head if you want to but that would be okay under your theory I assume. And that's, you know, maybe that sound like a ridiculous example but -- 

>> Yeah, it does sound like that. 

>> You know, I don't know how far removed it is from foreign governments who we know have state owned enterprises that are buying up interests in the United States. We know this now. 

>> Commissioner Hunter. 

>> Just focusing in on the domestic subsidiary. I think what you're trying to say and I think what commissioner Goodman was trying to isolate this also is a U.S. citizen who works for, let's just keep the Chrysler aligned for a minute here. A U.S. citizen who works for Chrysler shouldn't be able to contribute to the SSF because the people who work for the domestic subsidiary for Chrysler will by definition be influenced in how to direct that money by Fiat. Is that what you're saying? 

>> Personally I'm saying something a little more moderated than that. I think that possibility is definitely out there. And I want to per sue -- pursue that inquiry. That the people are being influenced in some sense or carrying out policies that they know would be in the interests of their foreign owners. 

>> But you think that -- 

>> That is a real possibility. This isn't about how the money's being spent because as I said most of the people that contribute to it have no say at all over how the money is being spent in most big corporate PACs. I think that is just the reality. And as my colleague said those people are perfectly free and nobody is trying to say they should spend all the money they want to contribute to any candidate they want. Nobody is saying that that's a problem at all. Whoever they work for. But what I would like to pursue in a rule-making is, you know, what is the status of these domestic subsidiaries of foreign owners and I think my colleague's proposal is to clear the decks for that rule making so that we don't have in the meantime people giving advice based on this particular AO. 

>> If I could just dive down a little bit further. You said that what I said sort of overstated it could you state what you think it should be for a U.S. citizen giving to an SSF for a domestic subsidiary who is owned by a foreign parent? Should they be able to give or not to the SSF? 

>> That is an issue I want to explore in the rule-making and as I think I mentioned before I'm willing to consider the possibility that we should look at SSF separately from corporate treasury spending and I haven't decided yet whether there's a legally defensive way to get there but I'm willing to look. 

>> So you don't want to blanketly say that a U.S. citizen shouldn't be able to give to the USSF. 

>> That's not what I'm saying today. 

>> And now I'm not going to reiterate what you say but what I think you're thinking is you want to have some kind of safeguard to make sure that the foreign company isn't deciding how to spend the money. And, guess what? We agree with you and that's the current law. And so I think a lot of this is talk past one another. You want to make sure that Fiat is not deciding how to spend money that people voluntarily gave to their SSF. People who are American citizens and there are all kinds of safeguards in the reg, in the ENG and the advisory opinions that we put forward today and TransCanada from the AO that you guys want to get rid of specifically said that there were all kinds of safeguards. Strong measures taken to ensure that its activity was not swayed by foreign influence. They did all kind of stuff and it's in the record of that AO to say we agree with you. The decision on how to spend the money is made by the American people running the U.S. subsidiary so I actually think we agree at least with respect to how SSF should be operated. 

>> Commissioner Weintraub. 

>> You may have more -- I suspect you do have more confidence that, you know, there are adequate safe guards in place right now. 

>> But I think and this comes up. This is something that, sorry, this is sort of common in the enforcement context and here that we're generally a little bit more willing to accept the representations of people that are made to the federal government often under penalty of perjury if someone attest to me they haven't had any influence by the foreign parent I tend to believe them. Especially contrary to evidence otherwise. And you don't. And that's just a completely different way of looking at this. You know, I actually have a friend who runs a domestic subsidiary of a huge foreign national corporation. I'm going to call him and say, how does this work? He is in charge of a lot of American citizens and I am sure that he follows the rules and makes the decision on his own. 

>> I don't think we ought to be making government policy based on what your husband told you or what you learned when you talk to one friend. We need a rule-making when we gather a broader number of perspectives before the commission. 

>> Yeah, but if I could just say, in that same vein we should not be making broad statements on speculative theories on what may or may not be going on with corporate governance. A lot of what has been said is a lot of speculation of what may or may not happen so I think that -- I think it's good advice for all of us to follow that we should be careful about how much we're relying on theoretical boogeyman to prosecute our case but commissioner Weintraub. 

>> Commissioner Goodman does this all the time. He draws on his experience as former practitioner as do I and that's -- in my experience of ad vising clients I never encountered a corporate PAC that gathered everybody together that was contributing to the PAC or really sought their input in much of a way at all as to who will get the money. I'm not drawing on complete specklation. It's informed by my experience out in the world. 

>> PACs may not meet one's idealic notion of how to operate in the world and I don't think freedom of association and freedom of speech, I think the founder fathers probably had many dark impressions of what the basic human nature was. But I don't think that, again, because some ideal is not met that one's associational freedoms are somewhat diminished and that's why I was a little bit troubled by the suggestion that because American citizens who are employed by a domestic subsidiary of a foreign corporation sure, I'm not talking about infringing upon the rights since they still have the right to contribute. I think that does give short sh rift to the freedom. I don't think the supreme court is under any delusions on how PACs or any other associations operate but because they don't meet of what we think is the perfect world of how associations might operate. I don't think that diminishes their freedom to associate at all and so I am troubled by that suggestion. But, well, I'll give -- I will let you respond to that and then one other question. It's about one o'clock so -- 

>> We want to get going. 

>> Why don't you respond? There was one thing to ask and I suggest taking a quick break and then come back and resume consideration. 

>> I don't know why we just don't take a vote. St the pretty clear. 

>> You can finish. 

>> We talked kind of around this issue a little bit but I'm not sure it's been addressed directly. In the -- in commissioner Weintraub's memo and the memo attached to your motion talkeds -- talks a lot about the game changer. The framework for domestic subsidiaries of foreign corporations being able to establish political action committees and engage in expenditures permitted by law that somehow when Citizens United was handed down that changed everything. Now I can understand to some extent how that changed -- I mean, it obviously worked a large impact in general but let's dig down to the specific issue. It did expand now that the corporations who can only previously make independent expenditures and contributions on the state and local level were permitted by law. They could now do so at the federal level but I got to say for the life of me I do not see how that was a game changer with respect to domestic subsidiaries of foreign parents. And their ability to establish PACs. Because before, the only thing that a corporate PAC can do that a corporation can do that is the sponsoring corporation for a PAC talks about the establishment consideration and the solicitation costs and I read earlier the -- from 110.20 talking about the broad prohibition on involvement direct or indirect. There is nothing post Citizens United that altered any of that. So -- like I said and I'm not saying this to be glib or sarcastic or anything I honestly do not know how -- with respect to the corporate PACs of domestic subsidiaries how Citizens United had any impact whatsoever. Because whatever avenues of leakage before were still there after or anything that happened after were still there before. So that's the one assertion that I've had trouble with all along. Because to me I think that the framework has remained the exact same at least with respect to those corporate PACs. So that's -- if one of my colleagues can enlighten me about how that framework changed I'd be interested to hear it but I just, like I said, in all of my analysis of this issue, which is, I don't think I've ever drafted more talking points for any open meeting before but that's one issue that I just don't understand. And if we can't agree on anything else, if there were ever just agreement on that issue that that framework for that hasn't changed, that would be helpful. Then the issue about, independent expenditure s and contributions and all of that that we can have that as a side discussion but I would throw that out for consideration and if we want to think about that for a second why don't we take a brief like five minute break? And then meet back here and then we can make a motion. And I -- I also -- I apologize for not mentioning that as with respect to this particular agenda item, agenda item ten is a statement of commissioner Walther regarding this motion. And that really should have been included as part of this agenda item. So I don't want to get short on that as well so we want to make sure that you get the full chance to address that as well, commissioner. Okay. Okay. 

>> Why don't we do is that. 

>> Let's make a motion so we can put a check through item seven on our agenda and come back and proceed. Commissioner ravel. 

>> I move approval of agenda document number 16-32-A proposal to rescind advisory opinion 2006-15. 

>> We have a motion on the table any further discussion on that table if none all those indicate by saying aye. Those opposed. 

>> That motion fails by vote of three to three with commissioners ravel, vice chairman and Weintraub in favor. Let's take a five minute recess and when we come back we will come back to agenda item nine which is commissioner Weintraub's proposal. 

>> (Break) test. 

>> It is a proposal to launch rule-making to ensure that political spending is free from influence. This is from 16-40-A and also -- for discussion purposes this also will incorporate item number ten which is the statement of vice chairman Walther regarding the proposal to rescind 2006-15 TRABS TransCanada. 

>> I feel like a lot of the ground has already been covered and I'm not proposing to repeat all of that again. 

>> Just for fun maybe we should. 

>> Really? Did you think that was so much fun? 

>> No. 

>> I did. 

>> You have no idea. I -- as I said earlier, this is a topic that I've been interested in pursuing for a very long time and I think it has particular urgency for the year. Given all the information we got at the hearing which I am very, very pleased. I was very excited to hold the hearing and I was very pleased with all the information that we got there and was very pleased to have my colleagues there and so attentive and I know that you've all looked at the transcripts and by the way if anybody missed it it's all on my page with transcripts and audios and any way you want to imbibe the information there was so many good ideas there. There's so much of foreign national context and raising good ideas there. John. And collect public comment. I mean my forum was to try to persuade you that there are issues out there and smart people thinking about them and coming up with ideas for us but that obviously was a small subsection of the people that I would hope would comment on a real NPRM if it looks like we were willing to tackle this in a serious way that several of the commenters at the hearing pointed out given what we're seeing out there in terms of these very sophisticated intrusions into our political system that are coming from abroad. You really would as I said in my memo have to be wearing some pretty rose colored classes to think there couldn't possibly be any foreign money coming from the dark vehicles out there and yes, I would love to tackle that issue of the dark money vehicles and I'm trying to focus this in more narrowly on the issue of foreign nationals so maybe this one's not so controversial. So I'm going to cross my fingers and make a motion and obviously that's not to close off any debate. I purposely made this very open-ended. I move that the commission open a rule-making. And direct the authors of general counsel to draft an NPRM. A notice of proposed rule-making for those of you who are not in the weeds on our FEC lingo that would allow the commission to consider every option to reduce the potential for foreign spending taking into account the views of every commissioner and all the good information that we already have in front of us and I'm sure we would get many more good ideas if we open this rule-making so I really, really hope that maybe we can move forward on this. 

>> Is there any further discussion? Mr. Vice chairman? I don't know if you wanted to speak to the agenda document that you made below? 

>> That's pretty much speaks for itself. I had occasion to address the issue back in 2006. I felt that -- and I still think the answer to the issues that they confront is especially more acute now because of Citizens United but we can argue all day as to whether there's been a nuanced change by the fact that its adoption but certainly the volume of money resulting from Citizens United in all areas is -- has become so great that I think there's a lot of foreign money as we go forward and I think we have a greater need for that reason to take a good hard look, as a commission, get our best professional judgment, try to do our best if we can't release the process we'll have been educational for the public and for Congress, we will be seen to have tried to do the best we can with a difficult situation and it may ignite some interest in Congress to do more on their own to try to give us more guidance. I recognize that my colleagues are reluctant to adopt a rule-making when Congress is not passed anything in attempt to -- some people in Congress let them give guidance in the past and was unsuccessful with it. I think it was more than 50% vote on that issue. Just enough to get it adopted. But certainly there's a lot of interest in Congress. I think we should give it a shot. I'm not, I think as professionally -- it's within the per view our jurisdiction to give guidance in this area and we ought to do that. So there's a number of different suggestions that have been made as to how the rules might play out and there's suggestions today in connection with the -- one that we previously voted on regarding certification issues. I think that's interesting. It certainly can be incorporated in a number of different ways. I should point out that in 2006 when I made my statement I did point out that PACs at least deserve a different analysis on the issues and -- with respect to direct cricks and -- contributions and that kind of thing I think there's room to try to make good series of rules that will staunch a good part of the money that is foreign in nature and still not impede good business which we all think we -- essential so our nation also. I'm hopeful that this process and the itch R efforts by commissioners so far will precipitate some action. I also don't think we can give promising guidance other than through rules and giving the public a chance to participate. Maybe Congress wants to participate by recommendation by commissioner ravel. Hopefully we can maybe -- have a hearing and talk about and it invite us. So I'm glad we have this process going today and hopefully we'll make some headway. 

>> Commissioner goodman. 

>> We may come full circle now we have said a lot. I have listened and I think I was comfortable with the proposal we made to address this issue of U.S. subsidiaries. And I'm not sure that in the breadth with which this proposal's written I'm ready to take a leap today without looking where we're going to land. It seems little bit all possible options when I think we can address this issue, with the rule that we propose today to limit the decision-making to U.S. citizens using U.S. income. Because to go -- because -- also not only does it say all options but commissioner Weintraub you have stated what your ultimate option is in the New York Times which is referenced in this. 

>> I'm willing to consider anything. I am not -- I am not saying -- I apologize for interrupting but I just want to be really clear on this. What I wrote in the New York Times was intentionally provocative. It was intended to stimulate discussion and I hope that it has but I am not saying today that that is the only thing that I would consider or is there aren't many other ideas that I think would be well worth entertaining and that I might ultimately support including yours. 

>> Fair point. Although you did start today saying that lawyers are advising people on the wrong law today. And I -- and so I'm not prepared to open up -- I guess that Pandora's box today given that you've already expressed that there is a zero tolerance standard. Your proPAEZ sal in the New York Times which informs where I think you want to go with this vehicle. You know, when I look at the matters we have decided on the foreign national since 2010, I wasn't here for the TransCanada one, but it followed that general paradigm. It followed the paradigm that's been in existence for 30 some years so your proposal in the New York Times contradicts that. Then there was this matter called Conseco for Congress and I guess I'd ask you how does your paradigm that you published in the New York Times apply to Conseco. Where a Mexican company gave money to the American candidate. The American candidate owned a Texas holding company, U.S. domestic -- so American citizen owned the Texas company and the Texas company owned the Mexican. Is that an American citizen or is that a foreign citizen? My point is that we applied the basic paradigm of looking at the basic definition of foreign national as recently as Mur 69-19 which was decided in 2016. We said, nope, that's a Mexican company and we voted 6-0 to puppish the -- punish the Mexican company and the American citizen even though he, an American citizen owned that Mexican company. So we'd have to unravel a lot of those issues and I'm not sure I'm prepared to shift from that basic paradigm. It was also the case that I was recused from but it is public and that was a case involving Russian network. I guess I would ask you under your theory that 1% spoils the whole or -- wags the whole dog. One percent characterizes the whole association as foreign, how do you then treat a wholly owned American media companies like -- that's not where I'm trying to go with this. I have not pre-judged the issue, I have not pre-judged where we have to land, so if you think that we need to figure out in advance what the rule is going to say and make sure we have four votes for it before we even put out a notice and seek public comment on different options, then that, to me, is a recipe for never getting anything done, which is, in fact, what we've been doing around here for the last six years since citizens united passed, getting nothing done in terms of accommodating our rules to that decision, and that is, you know, I thought there was, when I was listening to what people were saying before, I thought there was a slim chance, I wasn't overly optimistic, but I thought there was a slim chance that people might be open to talking about this, but, you know, if you say no today, you know, when are you going to say yes? You will have ample opportunity, as OGC is drafting this, to say, you know, I want to consider this and not that, or that idea is just too crazy to even put out for public comment, I'm willing to talk to you about that, I'm willing to engage with you on these issues, but, you know, what I'm hearing from you is that we put our proposal on the table, that's the only thing, which is basically codifying, you know, what we believe, what you guys believe to be the law today, we're not willing to consider any other options, and that means subsididaries of foreign governments, in your view, can go ahead and spend money in U.S. elections, and, you know, you can scoff at my example of the, you know, ISIS fighters who decide to buy a company in the United States, but what would stop them from doing that in your paradigm? How can we assure the American people that all these dark money groups are not spending 1 penny of foreign money when they are running their ads, and they don't disclose any of their donors? I'm looking for a path forward here. It doesn't have to be my ideal path, it certainly doesn't have to be what I put forward in my op ed, but, you know, as other people besides me have said, we are kind of in a situation of national crisis, affecting our national security, our political integrity, knowing that there are people outside of our borders who really would like to influence our election, would like to muck it up, cause, spread disinformation. How better to spread disinformation than through some dark money group? And, you know, you say you're not willing to consider even starting the rule-making, you want to shut it down at the beginning and not consider any options for moving forward? To me, that shows a high degree of tolerance for allowing a whole lot of uncertainty out there as to whether foreign money is coming in and unwillingness to consider doing anything constructive on this topic. 

>> SPEAKER: Excuse me, Mr. Chairman. 

>> SPEAKER: Mr. Goodman? 

>> SPEAKER: I think we did, we did set clear rules on who could make the decisions, what kind of money could be used, with clear restrictions on foreign government, but, um, then let me just ask you, if you're worried about disinformation in the public and foreign influence, what is your position on foreign-owned media enterprises? Like Russian Times or Algezera America, things like that, but what is your paradigm? Because the only way I've heard it expressed is in your New York Times piece. Please don't fault me for reading you and taking you seriously. 

>> SPEAKER: I'd also like you to listen to me today. 

>> SPEAKER: Okay, I'm listening to you today. You do not think that what you said in the New York Times is the law today? 

>> SPEAKER: I do not think that's the only option that we can consider. In a rule-making, we could set new rules. That's the whole point of a rule-making, and if you want to raise the issue in that rule-making, I think it's actually a very interesting issue that we have not taken a position on yet, what happens, how do the rules on media ownership, on the media exemption and the, um, foreign national ban, what's the interplay between those? I don't think that's a topic that the Commission has addressed yet, but we could consider it in this rule-making. 

>> SPEAKER: So, you would consider, your proposal would contemplate taking up then foreign ownership of the New York times as potentially tainting the New York Times? 

>> SPEAKER: If you want to consider media entities and the foreign national, I am willing to consider that. 

>> SPEAKER: It's your proposal, I'm asking, I'm testing the boundaries of what I'm being asked to vote on. 

>> SPEAKER: I'm saying I'm willing to throw anything in that will get four votes on it. 

>> SPEAKER: And you're contemplating taking up international labor unions? 

>> SPEAKER: The amount of resources that are available to corporations in this company dwarfs by a factor of a thousand or more, I think, I don't have the statistics on me right now, the resources that are owned by labor unions, but if you want to throw labor unions in, you know, that's why I want to focus on corporations, because that's where the money is, but, you know, if you want to throw unions in there, I'm happy to throw that in too. 

>> SPEAKER: I would need more time to consider all these. 

>> SPEAKER: I will just say that, you know, you want more time, I'm happy to talk to you anytime and hear what you have to say, but I started talking about this, well, I started talking about doing a foreign national rule-making in 2010, you weren't even here then, but I have certainly put it on people's, should have been on people's agenda since at least March of this year. So, you want more time, absolutely. Tell me when you're ready. In the meantime, I'll make a motion whenever it's appropriate. 

>> SPEAKER: Okay, and I commend you for raising this issue, because, to be honest, I've examined it and just gone back and looked through all sorts of documents that I've never poured through to get a better grasp on this issue and the full implications of it, and I think that, and I give you credit for spurring a conversation of the larger public, and also, I think an investigation amongst commissioners themselves on what the lay of the land is and what would be potential implications of changing the lay of the land. Um, the concern I have is, well, you know, a wise person once told me that it's generally not the best course to undertake a rule-making without a clear idea of where you might land, and, um, the wise person was you, Alla. You once, I remember, when we first got here, saying, um, I give you credit. I think that, just from the discussion we've had here, um, and the motion that we had on Commissioner Ravel's, that left the realm of, you know, the speculative, and now we were actually voting on a proposal to resend AOs and the underlying legal framework that those represented, and the one, the concern I have is are our first principles, when we start this, um, when we start this exercise, are we just in two different, on two different planets. Um, we are, you know, the proposal that we had was operating within the lines that, um, that have been set forth since 1978 about how the associational freedoms of domestic subsidiaries will still be intact, provided that there are precautions that are in place about preventing influence of foreign nationals over decision-making, no solicitation of foreign nationals for contributions to a pack, and also, that if there are expenditures made, that it only comes from domestically-generated revenue, and, so, that is the, you know, the paradigm within which we're operating, and at least I think that Commissioner Ravel expressed this, I don't know if the others did, I believe your concern is that, just by definition, domestic subsidiaries of foreign corporations, there's no way that they can truly be independent, and if that's the case, and if that were shared by the others, then our starting point is so disparate that there's really not a place we could land, because if we're in this world where a single foreign shareholder dollar kind of taints the organization, so, publically traded corporations, then that would make it difficult, even for us to come to an agreement on a certification regime, where we would say, okay, let's at least agree that packs and others certify that the money that they received is not from a foreign national and that a foreign national was not in any way involved with any decision-making process. If we have totally different ideas of what a foreign national is, if we believe that, by that, you mean not from a foreign national, that no foreign national is involved in the decision and that any monies were from, you know, domestically-generated revenue, if that's what we're thinking, but you're thinking that if anything were to come from a corporation that has foreign shareholders or a significant number of foreign shareholders, then even that becomes a difficult hill to climb. So, what I'm saying is that I don't want to foreclose the possibility of us trying to find some commonground, because I think that our interests in enforcing the ban are there, but I think that there may need to be a little bit more discussion or legwork to figure out, are there some first principles that we can start from that would allow a potential compromise to be reached. 

>> SPEAKER: Can I interject? 

>> SPEAKER: Commissioner Ravel? 

>> SPEAKER: Yes, and if I mischaracterized you -- 

>> SPEAKER: I think you do, and maybe I por drayed that in a way that made you think that, but what I was saying was in the AO, in the trans-pacific AO, those constraints were insufficient, what is it? 

>> SPEAKER: Trans-Canada. 

>> SPEAKER: Trans-Canada. They were insufficient to ensure that there really isn't foreign influence, and that's the concern. I mean, if we were to devise some scheme that comes up, for an SSF that comes up in the course of the rule-making where we would get information from people and be able to consider ways to have that clear assurance, despite the corporate structure, that we could put in, and I don't know that certification would be the thing that I would feel comfortable with necessarily, but some way that would enable us to even enforce that rule, I think what we have now, we don't have the capability of enforcing the prohibition on foreign nationals. 

>> SPEAKER: Okay, because the concern I had had about the earlier comments was the statement that one cannot help, even if someone who's an American citizen and who's on the board of directors and is in charge of making decisions for, um, a domestic subsidiaries pack or independent expenditure effort, if the notion is that they can't help but be influenced by the fact that I've met the foreign nationals who own this organization, and therefore, just the way in which the corporation is organized, you can't help but be influenced by that foreign source, that's what I thought was being said earlier, in which case that would have seemed to exclude all domestic subsidiaries. 

>> SPEAKER: That was not my intention. 

>> SPEAKER: Okay. Commissioner winetraub? 

>> SPEAKER: Subsidiaries who are 100 percent owned by foreign governments, is that a topic you'd be willing to address through rule-making? Are you willing to say, as you're sitting here today, that you are completely comfortable that a wholly owned subsidiary of a foreign government, that it's perfectly fine for them to be spending as much as they want in U.S. elections as long as there's somebody who's a U.S. citizen who's cutting the checks? 

>> SPEAKER: I mean, I think that that would certainly narrow the range considerably, and I'd, um, you know, I'd be willing to talk with you about that. I think, because I think that there is a difference and can be a difference between foreign government-owned versus just foreign national-owned, and, so, I mean, if we were able to, what I'm saying is I don't want to end the conversation and end the discussion, because if there is some way, even if we end up with something that we're not even all that satisfied with, because we all have to give, but we find that it moves the ball and lends a little more clarity, I don't want to foreclose that, but, um, but like I said, during the course of the conversation, there have been some positions that have been advanced, which made me concerned that even the kind of lowest common denominator approach might be difficult. 

>> SPEAKER: Mr. Chairman, can I -- 

>> SPEAKER: Mr. Vice Chairman, and then Commissioner Ravel. Commissioner Ravel. 

>> SPEAKER: Thank you, Mr. Vice Chair. I'm a little dismayed that at least the two of you are trying to, um, not have a, even a public comment period, even an ability to look at what all the possible solutions might be in advance, saying, well, because we think you pre-judged it, I mean, I feel that what you're doing is saying we can't even have a thoughtful discussion of these issues, when we're saying that we want that discussion, that we want to be open, we want to hear what the public has to say, we think it's so important, so crucially important to talk about these things, and admittedly, this is a complicated issue, it's not a simple issue, and I think we all believe that. We're not, you know, here to just do a knee-jerk response, what we're trying to do is just get input from people all over the country, and if you, I know you don't like real people, but, you know, academics and -- 

>> SPEAKER: I am real people. 

>> SPEAKER: Right. I've heard that been said. You know, I think that, really, we want to get a lot of people who have given thought, there were many of them at the forum, there's lots more of them all across the country, I am sure, who would want to weigh in on this subject and give us guidance in how we can formulate some of these responses, and to just foreclose that, um, I think is really kind of a sad thing for us. 

>> SPEAKER: Um, Mr., I think the Vice Chairman, um, I want to recognize you. I think the tennis ball has been flying back and forth a few times. 

>> SPEAKER: I think, um, as I remember, and as I've been told, when Congress adopted BICRA, there was a requirement that the Federal Election Commission had to adopt rules within a certain period of time. 

>> SPEAKER: That's true. 

>> SPEAKER: And when the Congress told the Federal Election Commission that they had to adopt regulations, they did it. Very diverse, brand new theories, brand new thoughts, brand new everything, they were told, listen, you have to agree and come up with rules. They worked day and night, day and night, and they did it. I see it no different here. We have different ideas, that little cracks in each of our thinking could make for a deal, and I think that we should give a self-imposed deadline, maybe get a procedure that we agree on how we're going to go about it. I, frankly, think that we ought to consider getting some, invite a team of people who are experts in the field of corporate structure organizations. One of the things citizens united has done is invited corporations to participate in our electional process to an unprecedented degree, and there are all sorts of, whether it's a limited partnership or whether there's half shares that are voting and non-voting shares, whole different ways of which control can be given up and still get the benefit of the wisdom of the people who have voting shares, there's a whole different slug of combinations that we could look at that probably satisfy our needs, but bear in mind, the law is what the law is, foreign money is not to intrude in our system, so we have to be guided by that no matter what. The second one is we don't want to interfere with our ability to engage in a free enterprise system. So, I think it can be done. I think you could look at the combination of corporations, you could look at the combination of people on boards of directors, you could look at certain issues with respect to packs, I think there's an argument, after all, it is the money of the shareholders, they would have a say, and it could be probably structured to give them pretty much a guaranteed say for their own money within some tolerable limits, I assume, but I really think that it's a matter of us deciding whether or not we're going to do this. If we make that decision, I think it can be done. So, that's what I'm looking for, is maybe some kind of a deadline that we give ourselves. 

>> SPEAKER: Commissioner Winetraub? 

>> SPEAKER: I think the deadline idea is a constructive suggestion. You know, what I hear my colleagues saying is we don't like all of your ideas, and therefore we're not willing to consider any of your ideas, and that, to me, does not really have any path forward. All we're asking is to, you know, get our lawyers drafting something. You would, obviously, have ample opportunity to review the document, and if there was something in there that you found so outrageous that you thought, well, I would never, ever, under any circumstances, ever support that, so no point in even having it in there, we can, you know, there's plenty of opportunities for crossing things out, but all we're trying to do is start the ball rolling, and, um, as I said, if you're not willing to at least empower the lawyers to put their pen to paper and start drafting some things up for us that we could then review, and it would still take four votes to get that NPRM out the door, then it seems to me that you're really saying we're not willing to consider anything at all. 

>> SPEAKER: Commissioner Goodman? 

>> SPEAKER: That's a bit of a mischaracterization. We were for something today. We did, we drafted it ourselves. 

>> SPEAKER: Well, let me restate -- 

>> SPEAKER: And you opposed it, and it died by a vote of three to three. So, it's not fair to say we're not for anything. We were for something. 

>> SPEAKER: Anything other than that document. You are not willing to consider any other proposal, anything. 

>> SPEAKER: Well, I really don't want to go after the New York Times, you know, but you've got to understand, Commissioner Winetraub, you took a shot, you expressed a viewpoint in the New York Times, and you doubled down on it today, and you said lawyers out there are giving bad information, the old law isn't the current law anymore, and that's your starting predicate, and we were asked to vote on a proposal by Commissioner Ravel today that completely undid 38 years or more of precedent of this body, so your starting points, we were forced to vote on a starting point today, completely abolish the construct that's been in place for 38 years. So, I accept your representation today, that what you wrote in the New York Times, you're not bound by, I do, but, you know, we had a concrete proposal today that we drafted, if you want to draw up a concrete proposal, I'd be happy to discuss it with you in the future, but I'm not going to harness a whole proceeding, I'm not prepared to support a whole proceeding of the Commission today to jump off this without seeing what the ideas are and where we're going to land. As I just mentioned, there are some really thorny issues there, going all the way from the labor unions to, um, media corporations, given that the interest expressed is no longer just a contribution or expenditure by a foreign national and is now about foreign-influenced money, emor ifsly defined, and until I get greater comfort with that concept, I'm standing on what I voted for today. 

>> SPEAKER: Commissioner Winetraub? 

>> SPEAKER: So, what you're saying is what you voted for today is the only thing you're willing to consider. You're not willing to let our lawyers try and draft up a document that you could then consider again, to see whether there is anything in there that you might be willing to support, including any kind of limitation on spending by, of corporate treasury funds by corporations that are wholly owned by foreign governments. You're not willing to consider that proposal? Let's do that. That would move the ball forward. Let's consider whether that's a good idea. 

>> SPEAKER: Let me just say a couple words. Um, I'm not prepared to support this today, but I will think, like I said, I think that this issue is one of importance, I think it has generated a lot of interest, and I think that, ultimately, we have the same goal, and I want to move the ball forward and talk with you over the next, and talk with all of you over the next, um, couple weeks, to see if there might be a way. Like I said, I think that this is, um, a little unclear as to where we might be able to go, and not withstanding the skills and abilities of Mr. Nodian and his staff, the ability to consider every option might even be a herculean task, even for you and your talented lawyers, but I don't want to be, I don't say that to be glib and say that let's just blow this off, I do want to think a little bit harder about what might be a way, because, um, I think we need to figure out where the potential agreement could lie and want to think about how we might be able to best, um, get the wide range of perspectives that I think we're looking for. So, long answer short, I can't support this today, but I do want to keep the dialogue open to see whether or not there is some way that we might be able to make some constructive progress. Mr. Vice Chairman? 

>> SPEAKER: I'm glad to hear that, and I think if we maybe can call upon you to call another meeting in 30 days, sometime next month, um, for not necessarily action, but at least communication on, you know, some directions, that would be helpful. I think as long as we keep the dialogue going in a constructive way, we'll get input already from people that we know, and maybe from Congress, on areas that are also being thought of, but, I mean, if we pick some issues, for example, like certification, that's a sensible approach in certain areas, not for everything, you know, or if you want to look at a combination of corporations and how they're structured, that's another way. Packs, certainly, I think deserve a way to work with the pack situation, so, I mean, if we work at it, I think we'll find commonground in more areas than we think, but we've got to, we can't just say, um, write me a letter, or send me something by e-mail and tell me this is it, and then we're all busy, and by the time we get back to it, we think of a bunch of reasons why it doesn't work, so it never, um, we don't gel unless we decide we're going to actually get it done. 

>> SPEAKER: Commissioner Hunter? 

>> SPEAKER: One of the things Commissioner Winetraub said earlier was just let me know if you think anything in here is crazy and we'll take it out, and the problem is there's a lot of things in there that we don't, or I'll speak for myself, don't think that should be even placed into an NPRM, and once we get into that, there's not a whole lot left from your bullet points, and I think we're trying to be nice here today, it's our best effort, but there are some crazy ideas in here, just to be blunt about it, and happy to talk about them later, you know, as you know, we didn't get the memo all that long ago. I did read your New York Times op ed, and you even admitted in there that part of your purpose was to blunt the impact of citizens united, a United States Supreme Court decision that gave corporations the right to exercise their first amendment right and run independent expenditures, and, so, you know, here we go with another shot at trying to curtail that first amendment right, and I did come to your forum, I listened to almost the whole thing, and I've reviewed some of the transcript, and I came away, I didn't want to, I was trying to be open-minded, but came away with, you know, with a similar feeling, and I said that to Ken Doil at the time. It's just hard for me to believe that most of the speakers there, you know, had, as a true interest, they didn't seem to have an interest of really curtailing foreign influence. To me, just listening to them, most of the conversation was about curtailing the ability of corporations to participate, and, um, that's just what I took out of it. You know, by way of an example of something that I think is pretty crazy, and I also said this at your forum, I said this when he talked about it, it looks like it's the third bullet, we should take into account the possibly divided loyalties of U.S.-based companies, and I asked him what he meant by that, I don't have the colloquy in front of me right now, but he basically said, yeah, there's U.S. corporations that do things that are against American national interest, and the last thing I think the federal government should do, and especially this place, is to have any say over who's loyal to this government and who's not. That is just so crazy to me, it's hard for me to even address it, and, you know, I think there's plenty of people, anyway, I probably should stop there. That, to me, is certainly not something that the federal government should be engaged in doing, and it sort of falls into the, again, I'm trying to be respectful, it falls into the category of, you know, another attempt to restrict speech, and that's the way I view the bulk of the bullet points in here, and, um, a lot of them are hard for me to take seriously. 

>> SPEAKER: Commissioner Winetraub? 

>> SPEAKER: All right, let me ask you specifically. I've tried this before, and I can't seem to get a straight answer. A rule-making that would explore whether companies that are wholly owned subsidiaries of foreign governments, whether those entities should be spending in U.S. elections, is that a crazy idea that you're not willing to consider? 

>> SPEAKER: Is that on the list? I might just be missing it. Is that on your list of things? 

>> SPEAKER: I'm sorry, am I limited to that? Because my point was to consider every option. 

>> SPEAKER: You're not limited to the list, but I just don't see that in here. 

>> SPEAKER: I'm asking you now. 

>> SPEAKER: Okay. I am certainly not in favor of foreign governments spending in elections. There's nobody that is in favor of that. 

>> SPEAKER: All right, so, is that on the table? A rule-making that would address spending, corporate spending of corporate treasury funds by companies that are wholly owned subsidiaries of foreign governments? 

>> SPEAKER: So, it's basically the SSF issue? 

>> SPEAKER: No. No, corporate spending, corporate treasury funds, not the packs. Corporate treasury funds, spending in U.S. elections by companies who are wholly owned subsidiaries of foreign governments. Is that a crazy idea or could we consider that? 

>> SPEAKER: I don't think that's a crazy idea. Second of all, I don't see it on your list, but I'm just saying, you've asked us to look at your list, and you spent years on your list and read everything, so I'm just kind of surprised it's not on your list, but we're not saying that there's nothing we should consider, and we've made a proposal, we voted on it, we think it was, you know, a concerted effort on our part, Commissioner Goodman's office drafted it. 

>> SPEAKER: Saw it 48 hours ago for the first time. 

>> SPEAKER: You can spend more time with it, if you want to vote again next time, you know -- 

>> SPEAKER: I want to put it in a rule-making. I want to get comment. 

>> SPEAKER: I understand that, but as Commissioner Goodman said, this is something that we put forward, we think it's a step in the right direction, it covers a lot of the issues we've talked about today, you know, it allows the certification process, which, you know, does provide something new, and that's a new thing that's not now out there, and it provides more safeguards, and I don't think that there's ever a process where everyone can feel completely comfortable that there's not any foreign influence. 

>> SPEAKER: But that proposal would allow spending by corporations that are wholly owned subsidiaries of foreign governments, as long as a U.S. citizen directs the spending. It would, under your proposal. So, how about a rule-making that would put your proposal out and the proposal that I'm making right here, right now. It's not complicated. I'm sorry it wasn't in the memo, but it's really not that hard to understand, that would put out the proposition that we should look at the rules for spending, corporate treasury funds only by corporations that are wholly owned subsidiaries of foreign governments. 

>> SPEAKER: I'm not sure that that's not already addressed by current law, but if you want to, as Commissioner Goodman said, if you want to draw something up, we'll take a look at it. 

>> SPEAKER: That's what I'm trying to do today, is to get consensus that we could have our lawyers draft something up for us for our consideration. You're saying you don't want our lawyers, you want me personally to write it, and then you'll consider it? 

>> SPEAKER: I think you can do it. 

>> SPEAKER: Is there anything anybody else wants to say or are we ready to go to a motion? 

>> SPEAKER: I think it has -- 

>> SPEAKER: Okay. 

>> SPEAKER: My motion, I'm going to stick with the motion that I circulated in advance so everyone would have time to consider it, I move that the Commission open a rule-making and direct the office of general council, because this is what they do, they draft NPRMs for us, direct them to draft a notice of proposed rule-making that would allow the Commission to consider every option for reducing the potential for foreign spending in our elections, taking into account the views of all Commissioners, and that document would then be drafted and presented to the Commissioners, and Commissioners could mark them up and see whether there was anything left at the end of the day that we were willing to put out for public comment. 

>> SPEAKER: Is there any further discussion on that motion? If none, all those in favor, indicate by saying I. Those opposed? Madam Secretary, that motion fails by a vote of three to three. 

>> SPEAKER: Mr. Chairman? 

>> SPEAKER: Yes. 

>> SPEAKER: Can I raise another suggestion? And I apologize, I didn't put this in the memo either, but it has occurred to me that one thing that perhaps we could do to reassure the American public that we actually take this issue seriously, I read your proposal, and you talked about some old cases as evidence that the Commission takes these issues seriously, look at these precedents. Well, some of those precedents took five and six years to resolve, so, um, there must have been a tolling agreement, because one of them started in 1996 and didn't get resolved until 2002. Could we direct our council that it is the sense of the Commission that foreign influence is a really important issue, and we would like them to prioritize that in their enforcement docket, and if we get complaints on that issue, we want them to put that at the top of the list and tee them up for our decision-making as soon as possible, so that if there are allegations in this election, we're not still talking about it in 2018? Could we make it an enforcement priority? 

>> SPEAKER: I think that that's, I think if we were to, it's been awhile since I've looked at our EPS criteria, I think that those rank highly in terms of getting scored, but, um, I have no problem with that. 

>> SPEAKER: Mr. Chairman? 

>> SPEAKER: Mr. Baker? I'm getting the nod from folks in the OGC. Commissioner Goodman? 

>> SPEAKER: I don't believe this violates any privilege, to go to aggregate data, but my office has looked at cases inside the building, and we count, um, 13 of various origin, either internal referrals or external pending in OGC that deal with the foreign national issue. 

>> SPEAKER: Well, let's tee them up and get at them. That's actually a fair number of complaints. 

>> SPEAKER: They're not all complaints. 

>> SPEAKER: Okay. 

>> SPEAKER: Okay. um, I think that brings us to the end of the agenda, and not a moment too soon. So, I will turn to Debbie Cuchona, are there any management or administrative matters to consider? 

>> SPEAKER: There are none. 

>> SPEAKER: Hearing none, this meeting is adjourned.