The flooding of the IRS with criticisms of the proposed rulemaking has shown that, on this issue at least, Washington is experiencing unity across party and ideological lines. The basic complaint, of course, is that the draft rule is too broad, chilling or preventing or just burdening legitimate political speech or activity. It is a remarkable proceeding. Activities that have been the targets of soft money reform for years—issue advertising and various other voter education activities—are now being vigorously defended against government regulation. In the short run, the result may be a rulemaking indefinitely delayed or, in content, much changed.
But, apart from the question of whether or how this draft might be revised to address these critiques, the hostile reception to the proposals may influence the course of the campaign finance debate in other ways. Here are two:
The FEC Offers a Hand—Or Two Hands—to the IRS
Under the federal campaign finance laws, the FEC and the IRS are directed to “consult and work together” in making their rules “mutually consistent.” 2 U.S.C. § 438(f). The IRS now proposes new 501(c)(4) tax exempt advocacy rules, responding to campaign finance controversies associated with the old ones, and the time has come for it to “consult and work together” with the FEC. But the FEC Commissioners don’t themselves “work together” very well on these issues and so, splitting along party lines, they have presented two views to the Service. The difference in viewpoint is predictable—Democrats favor disclosure, Republicans are suspicious of it—but the real interest of these submissions lies more in the strategies behind these presentations than in their substance.
Here, then, are summaries of each set of comments, following by a “translation” into more straightforward terms of what rival camps are really trying to say and do.
On the Campaign Finance Laws and Lawyers
A federal judge once opined that the federal campaign finance laws were hard to follow, and the same perplexity has been expressed by the Supreme Court—directly, in the course of oral argument, and somewhat less directly in an opinion of the court. See Citizens United v. FEC, 558 U.S. 310, 334-35 (2010) (Kennedy, J.). Conflicts over the constitutionality of various enactments and rules are common. And much has been written about the use and misuse of the heavily regulated legal process to harass, wear down or disgrace political adversaries.
Notwithstanding all of that, the beleaguered participant in the political process looking for legal advice can run into trouble when shopping for free or discounted legal services. Under federal and numerous state laws, these services are a contribution, like any other “in-kind” contribution, with some exceptions. A fully individual volunteer effort is typically permissible. Or a firm can donate but not bill for the time of its lawyers, provided the services are solely for the purpose of assuring compliance with the law and the value of the services is disclosed. As soon as life becomes more complicated, getting the help of a lawyer runs into contribution limits or restrictions on the sources of funds.