The FEC is AWOL
Air Date: April 6, 2020
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HEFFNER: I’m Alexander Heffner, your host on The Open Mind. My guest today is one of the foremost experts on American campaign finance, essentially how our politics runs. Anna Massoglia is a researcher, editor and writer based at the Center for Responsive Politics where she studies foreign influence, digital and political ads and is responsible for Open Secrets, Dark Money Data, and Foreign Lobby Watch. She’s held additional roles with the Lawyers Committee for Civil Rights Under Law, a Voting Rights Project, the U.S. House of Representatives and the Sunlight Foundation. And a pleasure to have you here.
MASSOGLIA: Thank you so much for having me.
HEFFNER: And you were noting to me just off camera a second ago, the Federal Election Commission is in effect handicapped by virtue of not having members to vote. So we might start there. What is going on with the Federal Election Commission?
MASSOGLIA: Well the Federal Election Commission, which is tasked with campaign finance oversight across the board for federal campaigns and other political groups has not had a quorum, so has not had enough commissioners to vote on any type of enforcement action for months now. This means that anytime there is a violation or an infraction of campaign finance law, there is very little that the FEC can do about that. So we have violations across the board potentially and nothing happening. We have seen a lot of progress in some areas since the 2016 elections, such as with digital ad disclosure, that those are now becoming available online. We’ve seen a lot of people working to address these issues, but we’ve also seen new issues cropping up such as the FEC’s lack of a quorum.
HEFFNER: Right. So that means in just tangible terms for the public, that the body, whose responsibility, the sole body, whose responsibility it is to enforce the law as it relates to campaign finance is AWOL, is not functioning.
MASSOGLIA: That’s correct. The FEC is charged with the civil enforcement. The Department of Justice also has to some extent some purview over campaign finance infractions once they reach a criminal level. But without the FEC flagging these infractions, there’s very little that’s happening outside of extremely egregious examples that have risen to that level.
HEFFNER: Can you give us a distinction? Can you make the distinction between criminal and civil so that we can understand what is considered penalties that the FEC would issue versus, you know, criminal review, and let’s just take an example of how Russian entities were funneling money through the NRA during the 2016 contest.
MASSOGLIA: Well, we didn’t really see much happen in terms of consequences of that at all. With the criminal side, you’re generally seeing more of these high profile cases. With foreign influence infractions Paul Manafort is one name that comes to mind, whereas on the FEC civil enforcement side, you’re seeing more fees, you’re seeing fines, you’re seeing groups’ flag where they have to amend their filings so that the public disclosure is corrected and that people have that information.
HEFFNER: But what actually are the violations that would be deemed civil versus criminal? In other words, at what point does it become criminal? What can you get away with in the absence of an FEC working for the American people?
MASSOGLIA: Well, gosh, in some cases you are seeing people not filing at all. You’re seeing foreign money going in through various groups. You’re seeing lack of donor disclosure across the board. One of the issues though is in many cases these are not necessarily violations of the law or even civil infractions in some cases since the law is very vague in many aspects of it. For example, dark money, money from undisclosed sources you are seeing were to like political purposes not having a definite meeting under the FEC’s rules and people exploiting loopholes like that, to not disclose their donors, not disclose their sources of funding and in many cases not disclose their financial information at all.
HEFFNER: Right. And the Supreme Court’s decision really enabled the floodgates to open, almost as widely as they possibly could in terms of granting any entity the right of a human being to donate and maybe to donate in an unlimited fashion. So we’re in this, in this climate that has been described as the wild west of campaign finance and reform. Specifically what have you seen so far with respect to the major candidates in 2020 and how they’re raising money, and whether or not there is a check to ensure that foreign influence is not absorbed in the way that they’re raising money, whether it is the President of the United States, Donald Trump, whether it is Bernie Sanders or any of the other candidates who are raising money right now.
MASSOGLIA: Well, it’s important to distinguish between what money the candidates are raising, which in many cases they are of course are across the board, are required to disclose their donors whether it’s from individuals versus outside groups spending where you have groups like super PACS, 501c 4s and other political groups that can take in many cases, unlimited money from sources including businesses, from undisclosed sources, and 501c 4s, which is a type of nonprofit often associated with dark money that can even take unlimited sums from foreign, from foreign nationals even, which are normally prohibited from being involved in U.S. elections but can also spend as long as they’re not using that funding. But there’s very little, there’s very little accountability mechanisms to ensure that that’s actually what’s happening behind the scenes.
HEFFNER: Case in point, supposedly the law is that these entities you describe cannot coordinate with campaigns, but they’re often, their underlying function or mission is synonymous with that of a presidential campaign. So all these entities that are able to raise money in a way that’s untraced or at least that’s unaccounted for, are then funneling their money towards the causes of the presidential campaigns. And that’s the system we have right now.
MASSOGLIA: That’s correct.
HEFFNER: What is the Center doing in, in a proactive way to try to flag whenever possible instances of violations and specifically in the arena that is unaccounted for where that dark money resides, the organizations you just mentioned. How do you actually go about the process of trying to find the origin of those organizations and where the money’s coming from?
MASSOGLIA: Oftentimes finding the origin of dark money is a difficult and in many cases, impossible task. One of the issues with that is there’s not a central repository of data or information on dark money groups. With political groups and campaigns that explicitly spend on politics you at least do have some level of disclosure to the Federal Election Commission with dark money groups. In many cases they are organized where they claim they are not political groups. They, for example, 501 c 4 nonprofits say they support social welfare but they can still spend unlimited sums in politics. So long as politicking isn’t their primary purpose. But in many cases they will run ads where they almost say vote for vote against, but they usually paint a candidate in a favorable or dis favorable light. And because they avoid those words, they can claim those ads are educational in many cases and not actually end up disclosing much, if anything to the Federal Election Commission.
We at the Center for Responsive Politics are trying to piece together that data, taking the traditional campaign finance data from the FEC, political ad data reported to the Federal Communications Commission as well as on digital platforms and other types of public records such as incorporation records, lobbying records Foreign Agents Registration Act filings and a variety of other different sources. But in many cases you have a lot of different pieces of the puzzle and you never find the full complete picture. You don’t ever really know everyone who is bankrolling those groups, if any. In some cases,
HEFFNER: We know that the digital economy and specifically online political content hasn’t been regulated to provide transparency to the American people. There are countless shows on this air, we’ve talked about the one candidate for higher office presidential office this cycle who has co-sponsored with Mark Warner and the late John McCain, the Honest Ads Act. It’s one signature piece of proposed legislation that hasn’t gotten a vote in the Senate that would begin to provide accountability so that all of the trail of ads that is video or memes via tweet or Instagram, that they require the same legible understanding of who’s financing it as a 30 second or 60 second TV spot. Now, to my knowledge Klobuchar’s legislation has gone nowhere. Are there preparations underway to think about in a new legislative climate if the American people do demand greater transparency, what would be the immediate steps so that the finance system is more transparent so that ads online specifically are more transparent?
MASSOGLIA: Addressing online ads that have political focuses at the federal level is really important because right now we have a very ad hoc system where certain digital platforms have decided to disclose some information about the digital ads that are running in a political context. We’ve seen Facebook, Google, Snapchat, Twitter to some extent, at least disclose the spending on certain ads and incorporate disclaimers. But there really isn’t a standardized system across the board. Many other platforms are continuing to run political ads or politically charged ads and have no disclosure or disclaimer system at all. So having some level of addressing that at a federal level where you have the disclosure side, that all the spending information is out there for the public to be able to access it. But also having disclaimers on those ads are really important so that people know who is paying for the messaging. It presents a lot of challenges with the Internet, especially because you don’t have traditional political ads in the same way you would on TV and radio as you mentioned. You have memes, you have videos; you have a lot of colorful ads that don’t necessarily use the vote for vote against language that would trigger the Federal Election Commission’s oversight. So there’s a lot of loopholes there. Closing that is really important. Honest Ads is one of those proposals that would address a lot of those issues.
HEFFNER: And the fact of the matter is Facebook pays Devin Nunes They pay the Republican Party and Democrats too, to not push forward regulation that would dampen their profits. I mean that explains in a nutshell why Mitch McConnell refuses to put up for debate what would pass the House instantly
MASSOGLIA: You’re seeing heavy lobbying spending by a lot of the tech companies who are the biggest beneficiaries of political ad spending. And you’re seeing…
HEFFNER: I just want the public to understand it for you to explain to them why we don’t have an Honest Ads Act right now.
MASSOGLIA: It’s a great question. Yeah, There’s a lot of issues out there and people really don’t know who’s behind so many of these ads and so much other messaging online.
HEFFNER: And not just Facebook, Alphabet, Google, they all have their lobbyists and they all have paid the Republicans, many of them, to keep the status quo which means information insecurity, a lack of integrity in the accountability of elections, which is getting to our present conundrum of this 2020 race. So without tapping into the caucus results or primary results, that to hear from you, I just as someone who’s monitored this so closely and, and is really so knowledgeable about electoral habits and the possibility of reform, we have some scenarios in the Democratic Party right now you have a candidate like Pete Buttigieg, who’s raised money like, much like Barack Obama, a lot of millionaires, some small donor support. You have someone like Bernie Sanders who’s raised money through largely small contributions in an unprecedented fashion too. And then you have someone like Mike Bloomberg who’s putting his own net worth forward and self-funding a campaign. I wanted just to hear your response to that question of these models of self-funding billionaires or individual donors.
MASSOGLIA: Well, money and politics and the issue of money in politics has played a unique role in the Democratic Primaries. We’ve seen much more of a focus on it and as an issue than in prior years where candidates are doing things like rejecting corporate money, rejecting lobbyist money, rejecting foreign agent money. And so it’s been really interesting to see them address that. They have taken very different fundraising models ranging from that self-financing to smaller donor donations. And one of the issues that we think is so important is actually getting the information about the donors and who’s funding those campaigns out there getting the financial information. One of the things that a lot of the candidates who had those smaller donors have done is actually the names of those voluntarily, which has been a really interesting thing to go through from a data standpoint but also gets the information out there about who these individuals are; gives a better perspective of who supporting the candidates. In many cases the donors can be a reflection of who’s actually going to get out and support the candidate. So it’s been nice to at least get a better gauge of that this year now that we have the information out there
HEFFNER: And has there been an audit to basically ensure that for the small donors in the case of Senator Sanders, that these are all real people. I mean, how much of the FEC’s absence here could reflect a lack of scrutiny on the individual donors. How confident can we be that when Sanders makes this point, he is being truthful that these are all individual small donors?
MASSOGLIA: Well, at least with the Federal Election Commission and many federal filings, you are submitting the information under the penalty of perjury in most cases. So even if you’re doing so voluntarily, to some extent you are ensuring that it is correct as opposed to the ad hoc disclosure such as online ads,
HEFFNER: Which doesn’t mean that a scheme could, you know, a scheme that that does not eliminate the possibility that a scheme could be concocted to throw that into.
MASSOGLIA: Yeah. And at least the FEC is able to flag in fractions. So they are still processing data processing filings as they get those in. In some cases we’ve seen the FEC send letters that people have received too much money over the contribution limits, that type of thing. The real issue comes in when the FEC wants to enforce the law and wants to actually fine campaigns or outside groups because without a quorum, that’s where the road stops for them.
HEFFNER: And are they referring penalty, greater penalties, criminal penalties to the Justice Department? Is that the way it’s supposed to work, ideally as the people on the front lines seeing what’s happening and if there may be impropriety or illegal behavior?
MASSOGLIA: Well, we don’t really see what happens behind the scenes and what those interactions look like between the FEC and the Justice Department. There was a recent Government Accountability office report that looked at how the FEC and the Justice Department worked together and it was not promising. The end suggestion of the report was that they should talk to each other, effectively and said that there was a stark lack of communication, that there was very little coordination, that access to information was not streamlined. And in many cases you had information at the FEC that never made it to the Justice Department or vice versa.
HEFFNER: It sounds like an electoral 9/11 with the CIA and FBI, the lack of communication.
MASSOGLIA: It’s an important issue to address then. But one of the more disconcerting parts of that conclusion was that even if they do have more communications, so many of the issues still can’t be addressed without a quorum at the FEC that there’s so little that they can do about certain violations that even if they’re flagged on one side or the other there’s a lot that still falls into falls through the cracks.
HEFFNER: Or without robust legislative parameters for how this ought to operate, right, I mean, even if there was a quorum and they did vote, it doesn’t mean that the post Citizen’s United climate would yield any kind of greater accountability or scrutiny. But let me ask you again, going back to those three models, the model of the, of the millionaires and then the regular donors versus the self-funding billionaire is there any insight you can offer into, you know, basically what might be better for responsive politics ultimately, and for transparency and accountability?
MASSOGLIA: One of the concerns I’ve seen raised about Bloomberg self-financing is that there are still a lot of questions about the financial situation behind that. Even though, you know you’re getting the money from Mike Bloomberg and it’s going out to those vendors, you don’t really know what the financial situation is behind that. You don’t know who he’s rubbing elbows with behind the scenes. You don’t know a lot of details of his finances until you get his personal financial disclosure. And even then that disclosure is very limited in many cases.
HEFFNER: But what about the effect on the democracy, I mean, your sense of how a candidate like Bloomberg, were he to in effect buy the nomination, how that would affect the long-term possibility of you know, accountability. You know, is it Stacey Abrams has been on record saying, well, at least we know where the money is coming from. It’s not Russian. It’s not foreign. You’re saying that may be not true because even if it’s Mike Bloomberg, it could be offshore accounts. It could be handled in a way that’s not patriotic. But I just wanted to get your insight into that question of the outcome of who wins the democratic nomination and ultimately who wins the next election. How will it affect the work that you do? Or how do you ideally hope it might affect the work that you do,
MASSOGLIA: I just hope that the information gets out there. With Bloomberg you are seeing just such a flood of money. It’s not necessarily the financing model, but the amount that has been really interesting to follow. You’re seeing ads almost constantly on TV, online. And with people seeing Mike Bloomberg ads everywhere in a way that they’re not for other candidates, I think it makes it hard to get the other candidates and messaging out there and people might be less familiar with them than they are with Bloomberg and it creates a bit of an uneven stage in many cases where other candidates might not be able to afford that, relying on outside donors.
HEFFNER: Has your organization, the Center for Responsive Politics, taking a position on Citizens United on, or you know, I know you study this, but have you tried to assess what would make our politics fair from the point of view of transparency and campaign finance?
MASSOGLIA: We’ve taken a position on some aspects of Citizens United. The ruling had a lot of different impacts and parts to it. The big thing that we have focused on is the transparency aspect where one of the impacts of opening up elections to corporate spending was that it opened up the door to groups like 501c 4s and LLCs that are very opaque, that can hide who is ultimately bankrolling these groups pouring money into elections. And that’s really what we are hoping to combat with by getting that information out there.
HEFFNER: Is there anything that folks at home watching can do to try to help in navigating the illicit side of the spending? When folks saw the onslaught of expenditures on Facebook and the fact that all these troll farms were undertaking these hotbeds of finance activity for American elections but not on American soil and not Americans who were funding them. Is there anything that they can do to help in the, in sort of the spirit of grassroots citizen journalism and reporting of things at the local or state or federal level that they find to be un-kosher and want to help correct?
MASSOGLIA: Well, if you notice something wrong, always flagging it can be helpful. We get a lot of great tips from people who see ads on TV from shady groups that they are curious who’s behind them. And in many cases we learn about new groups that way. So that can always be helpful. Also just voting is one of the things that’s really important. Continuing to vote in a way that promotes a quality democratic system and promotes clean politics in a way that’s more transparent. Another thing is just getting that information out there. Continuing to spread factual information rather than spreading disinformation. One of the things that’s been so problematic with the digital media and potential foreign influence has been just an onslaught of misinformation and disinformation all over social media platforms. And in many cases it’s not just a foreign actor putting that information out there. They’re relying on people continuing to spread it like a virus. And putting a stop to that, I think that that’s something that people can really do.
HEFFNER: Is there any indication you can share with us that the Russian interference that we saw in 2016, actually during the primary campaign and general has been revived in this Democratic primary contest so far?
MASSOGLIA: We have seen some issues with potential foreign spending. One of the things, not on the Democratic primary side, but with the National Rifle Association, which is one of the groups that came under scrutiny for accepting Russian money and ultimately admitted to that is that the, that their most recent tax return covering 2018 they disclosed spending on foreign fundraising for the first time. They had never done that before and now are fundraising and multiple different countries across the world while continuing to pour significant funds into U S election. So we are seeing, not necessarily that the foreign money is reaching U.S. elections ‘cause we don’t know what happens in the middle behind the scenes, but we’re seeing groups that are accepting foreign money than spending in us elections. And they’re not; they’re certainly not the only one. We’re seeing the Chamber of Commerce as well as a variety of other groups actually admitting to taking foreign funds at varying points or working with foreign companies and other foreign interests and then spending in elections. And even if it’s not necessarily the same dollar bill that goes into them from a foreign source going out to an election, it’s hard to say that doesn’t at least have some impact on the decisions that that group is making.
HEFFNER: And certainly we have no more clarity on whether Facebook and Alphabet and all these companies are accepting foreign monies through these 501 c super PACs, organizations that are pretending to be American entities but then in fact are not. But there is no more confidence really today that we can have that they’re going to entrap them and actually play by the rules.
MASSOGLIA: I mean, we’ve seen so many different actors on social media at least get flagged by some of the companies but in they continue to pop up with more. It’s not like quashing one is going to quash all of them through 501c4s, but also just through non-entities, through pages on Facebook where they can operate without any paper trail whatsoever. We’re seeing groups that are ultimately tied to foreign sources, impersonating news agencies as well as just American individuals. We’re seeing not just from Russia but also from a lot of other countries.
HEFFNER: Thank you so much for your time today, Anna.
MASSOGLIA: Thank you for having me.
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