HOME / ABOUT THE FEC / COMMISSIONERS / FORMER COMMISSIONERS / DAVID M. MASON / SPEECHES AND ARTICLES
Anonymity and the Internet:
Constitutional Issues in Campaign Finance Regulation
Testimony of David M. Mason
Commissioner, Federal Election Commission
at a hearing on The First Amendment and Campaign Finance Reform
before the Subcommittee on the Constitution, Committee on the Judiciary
U.S. House of Representatives
April 29, 1999
Thank you, Chairman Canady and Members of the Subcommittee for this opportunity to testify today. There is no more important issue in public policy than the question of how we govern ourselves, and in a democratic polity the constitutional arrangements for elections are the most fundamental questions we face as a people.
This testimony represents my personal views, and does not represent the position of the Federal Election Commission, or of any of my colleagues on the Commission.
It is worth noting at the outset that the framers of the Constitution left the primary responsibility for the governance and administration of elections to the states, casting Congress power over elections as superior but exceptional rather than routine.
Just as in Section 4 of Article I, the Federal government could not leave itself naked to potential abuse of the electoral process by the states, through the First Amendment, Congress and the American people established certain fundamental protections for the right of self-government, stated as limitations on the power of the government itself. It is the conflict of these fundamental rights with specific positive restrictions on election activity that gives rise to many constitutional issues in campaign finance in particular. Just as state legislation must give way to federal under the time, place and manner clause, both federal and state legislation must give way to the requirements of the Constitution itself, specifically to the First Amendment.
The Complexity and Persistence of Constitutional Questions in Campaign Finance
As one Member of the Independent Agency charged with interpreting, administering and enforcing (in a civil context) the Federal Election Campaign Act, what strikes me most is the degree to which constitutional considerations are an everyday factor in the administration of campaign finance law. For example, the Commission currently has twelve active regulations projects, seven of which directly implicate rights of speech, press or association. These range from major projects, such as our soft money rulemaking, to relatively minor ones, such as the definition of "personal funds."
Our litigation case load shows a similar pattern. The Commission has twenty active litigation cases. At least 11 feature significant First Amendment issues. Among these are:
This list does not include, since the FEC is not a party, Nixon v. Shrink Missouri Government PAC, the case which may implicate the constitutionality of the $1,000 contribution limit, which was recently accepted for review by the Supreme Court. Nor does this list include the recently dismissed case of FEC v. Forbes which involved the extent of press freedoms under the FECA.
The overwhelming impression in reviewing these major activities of the Commission is that the question of constitutional issues in campaign finance is a constant, continuing and developing one. There are not a few major issues, but many; they arise not occasionally, but every day. Though it has been 23 years since the Buckley decision and twenty years since the FECA was amended in any significant way, the Commission continues to face multiple and significant constitutional challenges. Issues which the Commission, and even much of the regulated community, once thought settled can emerge unexpectedly and result in significant effects for the Commission and politically active groups.
The Colorado Republican case, already reviewed by the Supreme Court once, and apparently on the way to a second hearing there, provides an outstanding example of the difficulties this constitutional tumult presents. This case arose out of a 1986 Senate election. Both the FEC and the Colorado Republican Party believed, until the case reached the Supreme Court in 1996, that the central issue was a speech standard: whether the particular ads in question should be judged under an "express advocacy" test or under a broader "electioneering message" standard. The district and circuit courts issued contrary opinions. Rather than resolving this issue, the Supreme Court determined that the central issues in the case were associational rights: deciding in the first instance that political parties had a right to engage in independent expenditures and remanding for rehearing the question of whether limits on coordinated spending by political parties are constitutional. After a decade of litigation, not only have we failed to get further clarification of the express advocacy standard, but a new area of constitutionally-protected activity has been defined, and yet another area is suggested. (My own conclusion is that the electioneering message test is too vague to pass constitutional muster, but to the extent that others disagree, Colorado not only failed to clarify the issue but raised additional complex questions.)
As the Subcommittee is aware, the District Court for Colorado has now decided that party spending limits are unconstitutional, and the case is now on appeal to the Tenth Circuit. If we are fortunate, the Tenth Circuit will hear the case and issue an opinion within a year, in time to file a cert petition in the Fall of 2000. The 1996 Supreme Court decision spawned significant political party independent expenditure efforts. Should the Tenth Circuit agree with the District Court on the question of coordinated spending by political parties, the Commission and political parties will be left in a very difficult position for the 2000 campaign cycle: should the Commission suspend enforcement of the law pending a Supreme Court decision, and should political parties violate the letter of the statute in expectation of such a decision?
One lesson from this experience is that we should not restrict our First Amendment analysis to speech rights alone. The efforts to "ban" soft money and broaden registration requirements which are the most prominent features of major campaign finance reform proposals display this flaw. Associational rights, press freedoms and the right to petition are all implicated in campaign finance legislation.
A second consideration is the degree to which constitutionally suspect legislation can put the executive agency administering the law and politically active citizens in difficult or even untenable positions.
The result of this plethora of post-Buckley constitutional litigation is that the Federal Election Commission sits as a sort of permanent administrative tribunal determining the degree and type of First Amendment freedoms different individuals and organizations are entitled to depending on our analysis of their purpose (political committee status), legal organization (for-profit, non-profit, LLC, partnership), FECA status (political party, press), internal structure (membership), private communications (coordination), as well as their mode of speech.
Everyone understands that any significant campaign finance reform legislation will be subject to a judicial test. What policy makers may fail to appreciate is the degree to which even a detailed, significant and far-reaching ruling such as Buckley still leaves a wide zone of constitutional uncertainty which may subject campaigns and citizens to decades of uncertainty while inferior courts and my agency work out the practical details of landmark rulings.
The constitutional stakes, uncertainty and practical difficulties inherent in this process argue strongly in my mind for incremental rather than revolutionary reform of the campaign finance system.
The Internet, the First Amendment and Campaign Finance Reform
Of course, while constitutional adjudication is slowly proceeding, the real world of campaigns and public policy can change rapidly, presenting constitutional questions in completely new contexts. One of the major challenges for the FEC today is in determining how to treat the Internet for purposes of the FECA. Following a series of enforcement matters and advisory opinion requests, the Commission recently instructed its staff to draw up a regulatory Notice of Inquiry on the Internet and the FECA.
The Internet presents First Amendment questions in a new and beneficial light, especially compared with broadcast communications. The practical dominance of broadcast communication in political campaigns has led to some extremely negative consequences for the First Amendment status of political activity. Broadcast media are characterized legally, and to some degree practically, by scarcity. The fact that broadcast licenses, and therefore broadcast time, is quite limited is a far greater factor in regulation of the medium than the public nature of the broadcast spectrum. With scarcity comes high prices, and a resulting over-focus on the cost of political campaigns, and a confusing admixture of spending and speech questions.
The Internet, on the other hand, has a basis of plenitude. There is literally no restriction on who can have an Internet site or on how many different sites there are. What is most salient about the Internet for First Amendment purposes is not whether 60 or 80 percent of the public has access, but interactivity. Anyone who is on the Internet can have something to say, and the financial and technical barriers to hosting a home page with substantial content are quite low. In the age of the Internet, everyone of even modest means can own a printing press.
For purposes of the First Amendment, and the FECAs media exemption, there is a real question of how extensively press freedoms should apply to the Internet. As a preliminary, if you have ever taken the opportunity to read newspapers from the early Federal period, you will note how partisan, contentious and irresponsible the press of the period marked by passage of the First Amendment was. Federal period newspapers remind me not so much of the New York Times or NBC as of the Drudge Report or "HillaryNo.Com."
In the specific context of the FECA, a media exemption applies to any "periodical publication" (unless controlled by a candidate or political committee). I am not sure why that exemption would apply any less to a regularly-updated personal homepage on the Internet as to ABCNews.com or Slate magazine.
The combination of open access and relatively low cost threatens to undermine the rationale behind the campaign finance regime. Just as Internet stock valuations appear untethered to underlying finances, the value of political communications on the Internet is driven more by innovation and presentation that is to say by ideas than by placement and spending. When the political impact of a site appears to far exceed its dollar cost, or when marginal costs are extremely low, it is difficult to apply a regulatory regime founded upon limits on finances, intended, we must remember, only to prevent financial corruption.
The $1,000 Contribution Limit: Preventing Corruption or Causing Corruption?
A more prosaic example of how change in the real world affects constitutional questions in campaign finance is the inflation question presented by the Shrink Missouri litigation. I think everyone would agree that at some point inflation could so erode the real value of a $1,000 contribution as to change its constitutional status. Though other questions are present, one issue in Shrink Missouri is likely to be whether the one-third diminution in the value of the $1,000 contribution since 1974 is a constitutionally-significant difference in kind.
In addition to this mathematical analysis, we should recall that the whole purpose of the $1,000 limit is to prevent corruption. The Federal Election Commissions enforcement caseload presents some evidence that this $1,000 limit may no longer advance that purpose, and may indeed itself have become a cause of corruption. It appears that this limit may be effectively so low as to induce people interested in engaging in politics to participate in illegal schemes to circumvent it with no directly corrupt purpose.
The Federal Election Commission has already released more 1996 cases involving conduit contribution allegations (section 441f of the statute) than it has had in any year in its history. The 1996 total is already over 20 percent higher than any previous year, and given our five year statute of limitations, additional 441f cases may yet be made public.
In at least some of these cases it appears that donors were motivated by little else than enthusiasm for a candidate. The sums raised in some instances are only a few thousand dollars, not enough to raise serious corruption concerns, nor in many of these cases were the recipient campaigns apparently aware of any extraordinary efforts which might give rise to suspicions of favor-seeking.
It appears that the $1,000 limit may have become effectively so low that it has itself become a cause of corrupt activity, except that its circumvention may be motivated in some instances by nothing other than a pure desire to support favored campaigns. In judicial terms, this raises the question of whether the $1,000 limit is narrowly tailored in advancing its corruption-preventing rationale.
As with all of this testimony, I should note that several of my fellow Commissioners may disagree with my analysis, but in my view the Commissions enforcement experience raises a genuine question in this regard.
Anonymous Speech or Expanded Disclosure?
Lastly, I would like to draw the Subcommittees attention to a string of cases involving anonymous speech because they raise questions about one of the broadest areas of agreement in Campaign Finance Reform, expanded disclosure. Simply put, since the Supreme Court enunciated a right to anonymous political speech in McIntyre v. Ohio, a string of lower courts has fairly consistently applied the Supreme Courts reasoning from voter referenda to candidate elections. Most of these courts have reached the conclusion that there is no constitutional difference in the degree of First Amendment protection between referenda and candidate elections. While I would note that the Supreme Court did view the candidate-referenda distinction as significant in Belotti, as to corporations, the consistent weight and powerful reasoning of these lower court opinions do not allow us to dismiss the concept that at least some anonymous activity is protected in candidate elections. In Buckley itself the Supreme Court declared that contributors who have valid reasons to fear retribution may remain anonymous despite the FECAs reporting requirements. Following are some significant cases and precedents in this area:
The only significant, somewhat contrary authority to the cases above is Kentucky Right To Life, Inc. v. Terry, 108 F.3d 637 (6th Cir. 1997) (state statute requiring "paid for by" disclaimer on independent expenditures was narrowly tailored to advance state interest in advising electorate of sources of support and prevent actual and perceived corruption).
I think it is fair to conclude from these cases that courts will protect at least some anonymous speech in candidate elections. Given these cases, I think Congress would be well served to consider carefully how (if at all) to expand disclosure requirements, rather than simply treating more disclosure as automatically better. The trend in court decisions indicates that we face at least some risk of having even current disclosure requirements struck down or narrowed.
Conclusion: Expanding Rather Than Limiting Political Participation
In conclusion, we must recall that all political activity is, by definition, protected by the First Amendment. While many of us have firm opinions, which we hope are well founded, about settled areas of the law, we can expect significant constitutional issues to arise and be adjudicated in a campaign finance context, as with other areas of First Amendment law. Congress should be cognizant that it is dealing not only with speech standards (soft money and express advocacy) but with a range of other First Amendment issues. As political practices and technologies change, new First Amendment issues will arise and formerly settled distinctions will fade or become irrelevant.
For these reasons, a comprehensive but constitutionally-permissible campaign finance reform may be an impossible quest. If Congress chooses to pass sweeping campaign finance legislation without careful attention to constitutional considerations, Members should realize that they are presenting significant constitutional issues not only to the courts, but to the agency that administers the law, and to campaigns and citizens who live under it, not only as to one major case, but in a series of controversies likely to last for decades.
For these reasons, Congress might look to opportunities, such as those presented by the Internet, to expand political liberties and participation, rather than restricting campaign finances, as the most appropriate means of preventing corruption and reforming the political process.