Independent Expenditures – California’s Super PACS

Tony Quinn
Editor, California Target Book

The big story in this primary election, and probably this fall, will not be the candidate campaigns, it will be the independent expenditures lavishly spent by all sorts of groups to elect favored candidates.  We saw this in the primary; we’ll see it in November.  This is, of course nothing new, it has been going on for a long time, but it will occur this year in the context of the top-two general election runoffs, and the new commission drawn legislative districts.

Huge spending by independent committees has been the rule in California for more than a decade, and even at the federal level, the Supreme Court’s controversial Citizens United ruling simply made it easier for corporations and wealthy individuals to spend money independently of candidates.  This is now raising some important issues about public disclosure of campaign funds, and whether regulation of money in politics really makes any sense.

A little history may be useful.  In 1976, in a ruling called Buckley v. Valeo, the US Supreme Court declared that independent expenditures on behalf of candidates could not be limited, but direct contributions to candidates could be.  Although the 2010 Citizens United decision raised the hackles of political reformers, its real effect was to allow corporations and unions to make their independent expenditures directly from their own treasuries.  Unions collect money through union dues check-offs and spend it through political action committees; corporations collect money for their PACs and spend it through business associations like the US Chamber of Commerce.  None of this was really changed by Citizens United.

In California, we have had this same basic system for decades.  But in 1996, activists groups did try to change it, by putting put a measure on the ballot to severely limit both candidate contributions and independent expenditures.  Although this measure, Proposition 208, passed, it was quickly declared unconstitutional.  The legislature, however, decided to pre-empt any future limitations by putting its own measure, Proposition 34, on the 2000 ballot and unfortunately it too passed.

Proposition 34 was one of the most cynical frauds ever advanced by the legislature.  It placed ridiculously low limits on direct contributions to candidates for the first time in history, but created a big loophole by allowing money to be laundered through county central committees who could then pass the money on to candidates.  It did not attempt to limit independent expenditures because it could not – that clearly would be unconstitutional – but it did make it very practical for interest groups to run lavish independent expenditure campaigns for favored candidates, as we saw in 2012.

So we have Brian Johnson, a Democratic candidate in the 46th Assembly District in Los Angeles, who raised $136,000, but on whose candidacy more than $2 million was spend in independent expenditures, both supporting Johnson and opposing him.  Or Leslie Daigle, a Republican Assembly candidate in Orange County who raised just $25,000, but was the beneficiary of $800,000 in independent expenditures.

In the 40 years since the Watergate scandal, a variety of schemes have been advanced to limit money in politics, all of which have failed.  Presidential public financing worked for some decades until the 2008 Obama campaign blew it away with his hugely successful fund raising.  The Supreme Court’s decision in Citizens United did not create the Super PACs that are now tossing around millions of dollars, but it made it much easier to form them.  The Super PACs at the federal level, like many California independent expenditure committees, hide behind clever names and voters do not know where the money is coming from.

So we are once more hearing about the need for reform.  Prohibiting contributions when the legislature is in session has been suggested, but like earlier reforms if you make it harder for candidates to raise money you will just strengthen the unlimited IE committees.

The best reform would be an immediate repeal of Proposition 34, and removing all limitations on direct contributions to candidates.  This should be accompanied by much better disclosure laws so voters know well before the election who is putting money into a campaign.

California’s disclosure laws, the hallmark of our post-Watergate reforms, have been badly diluted by the rise of amorphous independent expenditure committees.  The explosion of IE activity is directly the result of contribution limits that have made candidates little more than bumps on a log while independent groups fight pitched battles around them.

California needs reform: no limits on what anyone can give to a political candidate; and it needs more sunlight on the process: immediate and detailed reporting of those contributions.

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