Mark Schmitt has replied effectively and thoughtfully to Ezra’s Klein’s warning about small donors and their politics. Klein contends that we are overlooking the polarizing tendencies of small contributions made by Americans at the extremes of our politics. He argues that, just as small donations are becoming the stuff of myth, big money, while more “corrupting,” gets less credit than it should for pushing against polarization: “Big money often wants the two parties to get along” whereas small money exacerbates political divisions. Schmitt questions Klein’s claims about the part that big or small fundraising plays in either promoting or lessening polarization—and he decries “cynicism about money and reform that seems to be infecting the wonk class.”
In concluding that the IRS used “inappropriate criteria” in screening tax exempt applications, an Inspector General’s review cites as one source of this mismanagement “confusion” among employees about the law. The report recommends further internal guidance on the nature of an organization’s “primary” activity, and training or workshops designed to educate staff about “ political campaign intervention versus general advocacy.”
Discussion of the IRS’ mishandling of the tax exempt applications process might include a fundamental question: what role do we want to assign the IRS in approving tax-exemptions for groups engaged in one form or another of political, legislative or policy activity? And to keep the discussion still simpler, stripped of an additional complicating factor, the focus might be mostly on 501(c)(4) “social welfare organizations,” which, unlike their (c)(3) kin, do not offer donors a tax deduction and raise the additional issue of tax subsidies.
Tags: , ,

A new recipe for election reform

May 10, 2013
posted by Bob Bauer

This piece was co-authored with Trevor Potter and published this morning in the Washington Post:

Four decades after the campaign finance reforms that followed Watergate, arguments over the role of money in politics seem increasingly tired and unproductive. We ought to build on the experience of recent years and consider what’s necessary for a new phase of political reform.

Reforms appear destined to fail unless they rest on three key points: They should focus not on further restricting funding for political activity but rather on broadening avenues of citizen participation; they should look beyond contributions to parties and candidates to take into account other ways that money influences politics, including through the intersection of lobbying and political funding; and they should be informed by the experiences of states and localities.

Richard Briffault is unfailingly astute in his observations about the campaign finance laws and lucid in expressing them. In the days not too long ago when worries gathered around “527”s, he wrote an insightful essay on that subject. Now, with Super PACs on the minds of campaign finance analysts, he has turned attention to them. His subject is the Super PAC dedicated to the election of a single candidate and run, often with the candidate’s public approval, by former staff and associates. He proposes that the “coordination” standard be re-defined to capture these cases of “disguised contributions” and bring them within limits. These are not independent committees, he argues, but candidate committees in all but the name.