The dramatic reduction in political speech from independent groups in this year’s presidential election cycle, as compared to four years ago, is the result of legal risks and uncertainty created by the Federal Election Commission after the last presidential election, according to a memo released by the Center for Competitive Politics.
The mainstream media has noted that independent groups are playing a smaller advertising role during this election season, and a study released last week confirmed that the total expenditures of so-called 527 groups focused on federal races and issues in 2008 are less than half of what they were in 2004. In explaining why independent groups have been a diminished factor, both the Washington Post and Politico published stories citing stock market losses and the current economic downturn as reasons for decreased independent political spending.
"While it may be that the sudden across-the-board reduction in net worth played a role in preventing independent groups from amassing the funds necessary to maintain a significant advertising presence in this election cycle, there is more to it," observed Reid Cox, Legal Director at the Center for Competitive Politics. "The legal risk and cost of contributing to independent political speech efforts became real after the 2004 federal election cycle when the Federal Election Commission pursued enforcement actions against seven 527 groups, which resulted in $2.6 million in fines."
"While the fines were imposed on the groups, the FEC put donors on the hook at the same time because what they saw, heard, believed and understood was relevant to any investigation and enforcement action," Cox continued. "Quite simply, donors were prime evidence, subject to both investigation and subpoena. Those are some pretty good reasons for a donor to keep his pocketbook closed and mouth shut."
"There can be little doubt that the world’s economic travails have forced Americans to cut their spending, with political contributions being quick on the chopping block for many," Cox acknowledged. "But the financial collapse alone does not seem to tell the whole story of why independent groups have been much more quiet in 2008," he continued. "Legal risk and uncertainty have a lot to do with the sound of silence so many of us are hearing from independent political groups this election cycle," Cox concluded.
Cox’s memo is the sixth in a series of analyses produced by the Center for Competitive Politics examining the legal and political issues surrounding the advocacy activities of independent groups in the 2008 election.