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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 FECA’s 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 Commission’s 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 Commission’s enforcement experience raises a genuine question in this regard.


Anonymous Speech or Expanded Disclosure?

Lastly, I would like to draw the Subcommittee’s 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 Court’s 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 FECA’s reporting requirements. Following are some significant cases and precedents in this area:

  1. Talley v. California, 362 U.S. 60 (1960): Manuel Talley was convicted of violating a Los Angeles ordinance that prohibited the distribution of "any handbill in any place under any circumstances, which does not have printed on the cover, or the face thereof, the name and address of . . . the person who printed, wrote, compiled or manufactured [it] [and] the person who caused [it] to be distributed." Id. at 60-61. He had distributed handbills that "urged readers to help [his] organization [National Consumers Mobilization] carry on a boycott against certain merchants and businessmen . . . on the ground that . . . they carried products of manufacturers who will not offer equal employment opportunities . . . ." Id. at 61. The Court held that the statute was void on its face for violating the freedom of (anonymous) expression. Id. at 64-65. It noted that "anonymous pamphlets, leaflets, brochures and . . . books have played an important role in the progress of mankind," including in the founding of this country (e.g., the Federalist Papers), id. at 64-65. The ordinance did not seek to identify, as the City argued, only fraudulent, false or libelous materials, but rather barred all handbills that did not have the requisite disclaimer. Id. at 64.
  2. New York v. Duryea, 76 Misc.2d 948, 351 N.Y.S.2d 978 (1974) (cited in McIntyre, 514 U.S. at 348, n.11): New York prosecuted the Speaker of its State Assembly and two of his aides (his Executive and Special assistants), along with Assembly Majority Leader and an Assembly Member, for distributing letters bearing the signature of a person identified as a party official and urging members of that party to vote for its candidates, when, in fact, the letters had originated with another campaign committee (of which the Defendants were officers). The Court held that the First Amendment did not protect the Defendants’ fraudulent conduct, but the statute, which prohibited anonymous distribution of campaign literature, was unconstitutionally overbroad.
  3. Wilson v. Stocker, 819 F.2d 943 (10th Cir. 1987): James Wilson was arrested for distributing unsigned handbills opposing a candidate for the state senate in violation of state statute prohibiting anonymous campaign literature (that which, inter alia, "is designed to influence the voters on the nomination or election of a candidate"). Relying heavily on Talley, the Court held the statute was facially overbroad.
  4. McIntyre v. Ohio Elections Commission, 514 U.S. 334 (1995): Margaret McIntyre distributed leaflets opposing a school bond levy in violation of state statute that prohibited the distribution of anonymous campaign literature. The United States Supreme Court held that an author’s decision to remain anonymous, like other decisions concerning the content of publication, is an aspect of free speech that the First Amendment protects and outweighs the state’s interest in providing the electorate with information. Id. at 341-343. The statute also could not be justified based on preventing falsehoods, as it was not limited to such material. Id. at 343-345.

  6. State v. Moses, 655 So.2d 779 (La. App. 4 Cir. 1995) (first post-McIntyre decision): Napoleon Moses was indicted for violating a Louisiana statute that prohibited the distribution of campaign literature which did not contain the name (and in some cases the address) of the person distributing it. The Court held that McIntyre was sufficient authority for striking down the statute, given that, under the Louisiana Constitution and caselaw, "the state interest required to justify even a limited prohibition on election-related anonymous literature in Louisiana should be much more compelling than that which theoretically the U.S. Supreme Court [in McIntyre] might have found sufficient in Ohio or elsewhere." Id. at 782. (The Court seemed to conclude that the statute was unconstitutional under both the federal and state constitutions: "We conclude that the right to distribute anonymous campaign literature is clearly protected by the First Amendment to the United States Constitution as interpreted by the United States Supreme Court and by . . . the Louisiana Constitution. Accordingly, we declare [the statute] to be unconstitutional." Id. at 785.]
  7. Shrink Missouri Government PAC v. Maupin, 892 F. Supp. 1246 (E.D. Mo. 1995): Past and possibly future state candidates challenged state statute requiring any printed or broadcast matter with allegations about any other candidate contain disclaimers that candidate "approved" and "authorized" the advertisement. Court held that statue unconstitutional (not narrowly tailored).
  8. West Virginians for Life, Inc. v. Smith, 960 F. Supp. 1036 (S.D.W. Va. 1996): Not-for-profit corporation and individuals brought pre-enforcement challenge to state statutes prohibiting the: a) publication, distribution, or dissemination of a scorecard, voter guide, or other written analysis of a candidate’s position within 60 days of an election unless the document includes the name of the party responsible for it; and b) publication, issuance, or circulation of any anonymous letter, circular, or other publication tending to influence voting at any election. The Court held the state did not meet its burden of proving that the "anonymity provisions" were narrowly tailored to serve the compelling interest of avoiding corruption, nor were they limited to preventing fraudulent, false or misleading statements, or to regulating anonymous express advocacy (the statutes encompassed candidate issue advocacy, which, the court held, was just as protected as the noncandidate issue advocacy in McIntyre).
  9. Stewart v. Taylor, 953 F. Supp. 1047 (S.D. Ind. 1997): Candidate for township advisory board placed sign expressly advocating her election but which did not identify who paid for it, in violation of state statute requiring such identification on "material in support of or in opposition to a candidate" and requiring (in some instances) whether such material was approved by the candidate in support of whom it was published or circulated. Court held that statute was unconstitutional.
  10. Virginia Society For Human Life, Inc. v. Caldwell, 500 S.E.2d 814 (1998) (VSHL) (answer to certified question from United States Court of Appeals for the Fourth Circuit): non-profit group that conducted issue advocacy by preparing and distributing voter guides challenged (pre-enforcement) state statutes that, inter alia, required any writing made "for the purpose of influencing the outcome of an election for public office" identify the author. To avoid unconstitutional overbreadth, Virginia Supreme Court construed "influencing election" language so as not to apply to individuals and groups engaging solely in issue advocacy. Id. at 816-818.
  11. Arkansas Right to Life State Political Action Committee v. Butler, 29 F. Supp.2d 540 (W.D. Ark. 1998): Political action committee and individual brought pre-enforcement challenge to state statute requiring any person making an independent expenditure to name and identify itself and to state that such expenditure was "not authorized by candidate." Court held that while self-identification disclaimer was constitutional, there was no evidence that "authorization" component was narrowly tailored to advance state’s interest in advising electorate of candidate’s sources of support.
  12. Griset v. Fair Political Practices Commission, 69 Cal. App. 4th 818, 82 Cal. Rptr.2d 25 (1999): Candidate committees of incumbent councilman sent mass mailings without identifying councilman as controlling candidate in violation of state statute requiring candidates for office and individuals or groups supporting them to identify themselves on mass mailings sent to voters. Court held statute to be unconstitutional and noted that protection for anonymous speech was not confined to referenda but included candidate speech. Id. at 30-34.
  13. Opinion of the Oregon Attorney General, Number 8266, 1999 WL 133100 (March 10, 1999): Oregon Attorney General opined that state statute prohibiting most anonymous signs, publications and broadcasts used in political campaigns violated the free speech provisions of both the United States and Oregon Constitutions. The opinion noted, however, that courts subsequent to McIntyre have disagreed on the scope of the First Amendment’s protection for anonymity. Id. at 46. Comparing VSHL (narrowly construing statute to prohibit only anonymous express advocacy (thereby implicitly concluding that such prohibitions are constitutional)) with Moses (striking down statute in toto).

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.