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New FEC Pick Must Respect Law’s Boundaries

At a sparsely attended Senate Rules and Administration Committee hearing last week, labor union attorney John Sullivan, President Barack Obama’s first Federal Election Commission nominee, faced mostly softball questions, and his nomination will likely sail through the Senate following a voice vote in committee on Thursday.

But a debate among FEC watchers rages over how Sullivan will interpret FEC regulations and Supreme Court rulings on political speech.

Sen. Bob Bennett (R-Utah) asked Sullivan about sensational comments from J. Gerald Hebert, executive director of the Campaign Legal Center, who blasted Sullivan’s nomination. Hebert called Sullivan a “radical— for daring to criticize aspects of McCain-Feingold (the reformers’ Holy Grail) while representing the Service Employees International Union as its associate general counsel.

The unease over Sullivan simmering among self-styled reform organizations is an extension of their attacks on the FEC for “partisan deadlocks— and a supposed failure to enforce “the law.— However, the split votes represent genuine disagreements between the commissioners and are shaped by Supreme Court rulings — not partisanship or flouting the law.

“Reform— groups have little patience for any FEC vote — split or otherwise — that fails to limit political speech by independent groups, parties and candidates alike.

Sullivan has the experience to see reform arguments for what they are, and navigate complex legal matters as groups gear up for issue debates near the midterm elections.

One case, among this year’s recent 3-3 splits, illustrates how crass intimidation tactics can chill independent speech and why Sullivan might even join Republican commissioners in some debates over FEC enforcement.

In the heat of last year’s Ohio Democratic primary, the American Leadership Project, a nonprofit 527 organization backed by some in the labor community, broadcast ads touting issues associated with Hillary Rodham Clinton, including her Senate efforts to create jobs. The ads urged Ohioans to “call Sen. Clinton and tell her to keep working on solutions for the middle class.—

Presumably, Obama’s campaign did not want a group praising Clinton policies on the eve of the Ohio primary, so it filed a complaint alleging that ALP had failed to register as a political committee. The Obama team promised a federal investigation that would be rough on ALP, specifically “rough on the donors.—

Despite the tough talk, the FEC dismissed the allegations. Regulation proponents quickly expressed outrage, claiming that the FEC wouldn’t enforce “the law.—

But that was the very question before the FEC: Was ALP a “political committee— under the law? The answer is extremely important for those concerned about bright lines, jurisprudence and free political speech.

Groups that meet the definition of political committee must avoid all corporate or union funding, abide by limits on funds from individuals and regularly report every dollar they disburse or receive — including the names and addresses of their members. This invasion of donors’ privacy can cripple a group’s fundraising. But failure to register where necessary can open a group to criminal sanctions. Thus, merely alleging a group is a political committee can send donors scurrying for the exits — exactly the result the Obama campaign sought for donors to ALP.

The Supreme Court has permitted Congress to address perceived corruption through restrictions on campaigns, including the regulation of political committees, defined as groups that make expenditures or raise contributions in excess of $1,000 to influence elections, provided their “major purpose— is campaign activity.

Since all groups raise and spend money, however, and since most any speech about public affairs can influence an election, the court clearly limited the activities that make a group a political committee: making contributions to candidates, coordinating expenditures, or raising or spending funds for messages that expressly advocate the election or defeat of a candidate.

The court’s “major purpose— test is an added shield for nonprofit groups that use contributions from individuals to occasionally and independently advocate the election or defeat of a candidate. A group that makes expenditures or accepts contributions is still exempt from regulation as a political committee if its major purpose is something other than electing politicians.

But a group’s major purpose cannot make it a political committee if it doesn’t first engage in campaign activities as the court defined them, and a group’s intent cannot convert issue speech into express advocacy.

Nonetheless, the Obama campaign argued that the FEC should first determine ALP’s “major purpose— and regulate ALP as a political committee if that purpose was to elect candidates, regardless of whether it made contributions, coordinated communications or engaged in express advocacy. In doing so, the Obama campaign and its “reform— allies attempted to erase bright lines and turn the court’s major purpose test on its head, from a test intended to protect speech to a means to extend regulation.

The Obama campaign and reform groups sought to do this even though ALP chose the text of its ads from examples included in FEC regulations adopted a few months earlier to conform with the Supreme Court’s opinion in FEC v. Wisconsin Right to Life Inc. There the Supreme Court reiterated that distinguishing protected issue ads from regulated campaign ads turns on the language of the ad and not on a group’s intent, as an “intent-based test would chill core political speech, by opening the door to a trial on every ad … on the theory that the speaker actually intended to affect an election, no matter how compelling the indications that the ad concerned a …. policy issue.—

Thankfully, the FEC, unlike “reform— organizations now criticizing it, chose to follow the law and judicial precedent. By dismissing the complaint, the FEC signaled that a group’s intent cannot turn protected issue discussion into expenditures.

The legal issues in the ALP matter transcend party. Here’s hoping that Sullivan, who expressed respect for Supreme Court precedent at his hearing Wednesday, will reject calls from pro-regulation groups to ignore court precedent and chill political speech.

Steve Hoersting, vice president of the Center for Competitive Politics, is a former general counsel for the National Republican Senatorial Committee.

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