A pair of important new challenges to IRS rules that chill non-profit political speech

Last Friday, two lawsuits were filed in federal court challenging the IRS’s definition of "political intervention" as applied to two not-for-profit organizations – Catholic Answers, Inc., and the Christian Coalition of Florida, Inc.  The new legal challenges claim the IRS’s application of an "all the facts and circumstances" test to determine whether non-profit political speech is tax exempt has the effect of chilling constitutionally protected "grass roots lobbying, issue advocacy and voter education activity ."  The lawsuits also allege that the IRS’s "all the facts and circumstances" approach to determining whether a non-profit has engaged in non-exempt "political intervention" activity is unconstitutionally vague and overbroad.

The complaints ask the federal courts to strike down the IRS’s "political intervention" rules and regulations both on their face and as-applied to the two non-profit groups, as well as additionally asking for tax refunds and that the IRS be enjoined from denying 501(c)(4) tax exempt status to the Christian Coalition of Florida.

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Filed Under: Blog

Money also isn’t a free press…

The Center for Competitive Politics generally sticks with defending what we call the First Amendment political rights of speech, assembly, and petition, which means we rarely touch on the other two First Amendment rights, press and religion. Occasionally when politics intersects with these rights, such as regarding political endorsements by newspapers or religious leaders, we may comment but generally these other rights just fall outside our main areas of work.

That said, the recent troubles of the newspaper industry do bring an interesting parallel to mind, that regarding the importance of money in politics and whether "money is speech."

Advocates of so-called campaign finance "reform" insist that "money isn’t speech," an argument they must make if they are to have any hope at all of not running up against the First Amendment’s prohibition of speech limits.

As I like to point out to people, money isn’t speech, but money also isn’t a free press.  But just try to run the New York Times or any other newspaper without money and see how long it lasts, I tell people. I always assumed I was making a rhetorical point or even a somewhat absurd, take-the-logic-to-its-furthest-extreme argument in order to illustrate how important money was to enable free speech. Little did I know that the economic downturn would prove the point for me.

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Filed Under: Blog

Northeast ‘clean elections’ advocates plot strategy in New Jersey

At an event at the Eagleton Institute in New Jersey this past Friday, representatives and advocates of taxpayer financed elections in New York, New Jersey and Connecticut gathered to discuss the details of their programs and their plans for the future.

The broad generalizations, sweeping disregard for individual First Amendment rights and refusal to recognize any failures in these programs weren’t surprising in the least.  However, several comments went so above and beyond that they bear repeating.

For example, one representative from New Jersey stated unequivocally that their gubernatorial program was a success in limiting influence and "purifying" elections, no doubt the reason New Jersey is the pinnacle of ethics and virtue today. 

Another panelist went even further, noting that the problem with these programs is that lobbyists continue to exist even after Election Day.  Apparently, legislators in New Jersey need protection from lobbyists (AKA representatives of citizens) after they’re elected, lest they be unable to distinguish between policy positions they agree with and ones they disagree with.

(click here to read more)

Filed Under: Blog

‘Marketplace of ideas for contributions’

Former FEC commissioner and Heritage Foundation scholar Hans von Spakovsky has penned an interesting ‘Ideas’ piece for Politico.

The op-ed lays out a clear and reasoned opposition to the recently-introduced "Fair Elections Now Act," which would enact taxpayer financed elections at the congressional level.

Supporters of the bill seem to be relying on a argument that the bill would free lawmakers to spend more time legislating instead of raising money (previous efforts to enact the system relied mostly on a corruption argument). The bill’s chief sponsor, Sen Dick Durbin, cites this "problem" first in his office’s press release announcing the bill. Other supporters of public financing, such as Bob Bauer, are pressing this issue as well.

(click here to read more)

Filed Under: Blog

Text of ‘Fair Elections Now Act’ released

The text of the Fair Elections Now Act, which would enact taxpayer financed campaigns at the congressional level, is now available.

The House version, H.R. 1826, is here and the Senate version, S. 752, is here.

The bills have been referred to the relevant committees in the House and Senate. Starting next week, Congress is on a two-week recess, and there has been no word from leadership on a schedule for taking up the legislation.

Filed Under: Blog

Arizona Progressives Slam “Clean Elections” Program

Arizona and Maine, we are continually told, are examples of the success of so-called “clean elections” schemes that shovel taxpayer dollars into the campaign coffers of politicians. Few advocates, however, ever bother to cite exactly what “success” looks like under “clean elections,” other than to note the increasing number of candidates lining up for their campaign welfare checks.

The Phoenix News in Arizona published an article a few days ago taking down claims that “clean elections” has somehow changed politics in the Copper State, or even led to a better quality of legislator. The report is rich with detail of the gaming and manipulation that occurs, and how Arizona politicians have rather easily twisted “clean elections” into their own purposes.

A few excerpts:

The state’s landmark Clean Elections system began with the best of intentions. Progressives wanted to reduce the role of money in politics – taxpayer-funded elections seemed a brilliant way to take down special interests and give control back to the people.

But in the 10 years since voters approved the system, it’s become a source of irregularities. Today we have politicians using Clean Elections money as personal slush funds. We have Clean Elections being used as just one more tool [by Nixonian politicians]. And, ultimately, we have a Legislature that’s more stupid, and more reactionary, than ever…

Click here for more on the failure of Arizona’s “clean elections” scheme

Filed Under: Blog, Arizona

Mandatory Disclosure for Ballot-Initiative Campaigns

The most common approach to disclosure in American politics is simply and aptly described as “more is better.” Disclosure is often championed as a low-cost means of combating the allegedly corrosive effects of money in politics by providing information to the public about the source of funding and expenditures made by groups advocating for the […]

Filed Under: Disclosure, Disclosure, Disclosure, Disclosure State, External Relations Sub-Pages, Research, ballot initiatives, campaign finance reform, Dick Carpenter, Disclosure, institute for justice, polling, Disclosure, Disclosure, California, Colorado, Florida, Massachusetts, Ohio, Washington

Another day, another dramatic overreach by campaign finance “reformers”

We at the Center for Competitive Politics are used to seeing broad sweeping claims by the self-anointed campaign finance "reform" community, and equally expansive proposals to wipe away core First Amendment political rights in an effort to somehow deal with real or imagined "corruption." Just yesterday, Senator Dick Durbin of Illinois proposed taxpayer handouts for politicians to run their campaigns, because apparently it’s tiring and time consuming having to ask for contributions from people (coming soon, the Free Binky’s, Milk, and Cookies for Weary Candidates Act).

But even we were surprised to find buried in the report of Governor Pat Quinn’s Illinois Reform Commission, released yesterday, a recommendation for "reform" that would strip huge numbers of citizens of the right to contribute to candidates they support.

Under the Campaign Finance section, recommendation #4 stood out. It reads:

4. Extend Pay-to-Play Ban. Ban contributions to state constitutional or legislative campaigns from contractors who have obtained or are seeking state contracts of more than $50,000 during the election cycle and companies engaged in regulated practices. (emphasis mine)

Companies engaged in regulated practices? What does that mean? In the most expansive reading, that’s every company in Illinois, all of which are subject to various health, occupational, and safety regulations. A more likely but hardly less troubling reading would mean any company that requires a state license to operate.

So, any doctor or attorney in private practice or who owns a portion of their practice, would be unable to contribute to candidates. Many building contractors, whether they do government work or not, have state licenses.  The Illinois Department of Professional Regulation lists more than 250 distinct professions that would presumably fall under the "regulated practices" definition.

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Filed Under: Blog

April Fools! Congress proposes bailing out politicians

Yesterday, congressional supporters of campaign finance restrictions filed their bill to enact taxpayer-financed campaigns at the congressional level. It’s too bad they didn’t wait to roll out this silly idea on a more appropriate day — like today, an appropriate commemoration of April Fools Day.

You’d have to be a fool to think the public is going to buy a half-thought out scheme to bailout politicians with taxpayer money.

CCP published an op-ed in today’s Washington Examiner detailing why the bill is a bad idea. Bloomberg and The Washington Post covered the roll out. The text of the bills, jointly introduced in the House and Senate, are not yet publicly available, but there are likely to be constitional questions about some of the provisions in the legislation.

(click here to read more)

Filed Under: Blog

Better Parties, Better Government: A Realistic Program for Campaign Finance Reform

In Better Parties, Better Government: A Realistic Program for Campaign Finance Reform (Washington, D.C.:  American Enterprise Institute Press, 2009), authors Joel M. Gora and Peter J. Wallison conduct a significant survey of campaign finance regulations beginning in the early 1970’s.

The authors assert that most of the provisions enacted over the past several decades have failed to achieve their goal of limiting corruption and instead have acted to strengthen the incumbency advantage. According to Gora and Wallison, “the current campaign finance system works to assist the campaigns of those who created it.”

After their exhaustive look at the history of campaign finance reform measures, Gora and Wallison examine past and current alternatives to remedy the broken system. They conclude that most reform schemes further the incumbency advantage, with taxpayer financed campaigns and contribution limits being the biggest offenders in this regard.

To remedy this issue, the authors demonstrate that the best and most effective way to fix the current incumbent-advantaged system would be to ease the coordination restrictions on parties, allowing them to become the principle campaign financier. Ultimately, the authors argue that this single change in the current system would have substantial benefits for the American election model.

Filed Under: Coordination, Political Parties, Research, Tax Financed Campaigns Research, Tax-Financing, Taxpayer Financed Campaigns, campaign contributions, Contribution, Contribution Limits, Coordination, Political Committees & 527s, Contributions & Limits, Coordination, Political Committees & 527s, Political Parties