H. Rept. 112-571 - 112th Congress (2011-2012)
June 29, 2012, As Reported by the House Administration Committee

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House Report 112-571 - THIRD SEMIANNUAL REPORT ON THE ACTIVITIES of the COMMITTEE ON HOUSE ADMINISTRATION of the HOUSE OF REPRESENTATIVES during the ONE HUNDRED TWELFTH CONGRESS together with minority views




[House Report 112-571]
[From the U.S. Government Printing Office]


112th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     112-571
_______________________________________________________________________

                                     

                                                 Union Calendar No. 411

               THIRD SEMIANNUAL REPORT ON THE ACTIVITIES

                                 of the

                   COMMITTEE ON HOUSE ADMINISTRATION

                                 of the

                        HOUSE OF REPRESENTATIVES

                               during the

                      ONE HUNDRED TWELFTH CONGRESS

                      together with minority views

<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>


 June 29, 2012.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed


                         LETTER OF TRANSMITTAL

                              ----------                              

                          House of Representatives,
                         Committee on House Administration,
                                     Washington, DC, June 29, 2012.
Hon. Karen Haas,
Clerk of the House,
The Capitol, Washington, DC.
    Dear Ms. Haas: Pursuant to Rule XI, clause 1, paragraph (d) 
of the Rules of the U.S. House of Representatives, I hereby 
transmit the Third Semiannual Report on the Activities of the 
Committee on House Administration. This report summarizes the 
activities of the Committee with respect to its legislative and 
oversight responsibilities in the 112th Congress from December 
2011 to June 2012.
            Sincerely,
                                         Daniel E. Lungren,
                                                          Chairman.


                                                 Union Calendar No. 441
112th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     112-571

======================================================================



 
  THIRD SEMIANNUAL REPORT ON THE ACTIVITIES OF THE COMMITTEE ON HOUSE 
                ADMINISTRATION DURING THE 112TH CONGRESS

                                _______
                                

 June 29, 2012.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

   Mr. Daniel E. Lungren of California, from the Committee on House 
                Administration, submitted the following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                              INTRODUCTION

    The Committee on House Administration (Committee) is 
charged with the oversight of federal elections and the day-to-
day operations of the House of Representatives. During the 
112th Congress, the Committee has two subcommittees: the 
Subcommittee on Elections, which examines issues related to 
elections and voting systems, and the Subcommittee on 
Oversight, which focuses on identifying and reducing wasteful 
spending within House operations and establishing best 
practices to help improve services to the House community.

                           COMMITTEE FUNDING

    Under House rule X, clause 6, the Committee on House 
Administration is charged with the responsibility of reporting 
an expense resolution to grant authorization for the expenses, 
including salaries, of the select and standing committees of 
the House.
    In November 2011, the Committee held an oversight hearing 
to review the budgets for all the standing and select 
committees (except the Committee on Appropriations) in 2011, 
and to review budget planning for 2012. During the hearing, 
Committee members asked the Chairs and Ranking Members about 
how each committee operated with their lower budgets and 
whether the committees could continue to perform their 
responsibilities with future cuts to their budgets. Each 
committee was also questioned on whether they have held to the 
practice of giving the minority one-third of the committee's 
budget.
    On December 14, 2011, Chairman Lungren introduced a 
resolution regarding committee funding, H. Res. 496, which 
reduced most House Committee budget authorizations by 6.4% for 
the second session of the 112th Congress. This reduction, 
matching the appropriated funds provided for 2012, further 
reduced House spending and promoted a greater level of 
efficiency within Committee operations. On December 16, 2011, 
the Committee, by voice vote, agreed to a motion to favorably 
report the resolution to the House. On February 1, 2012, the 
House considered H. Res. 496, adjusting the amount provided for 
the expenses of certain committees of the House of 
Representatives in the 112th Congress. The resolution was 
considered under a motion to suspend the rules. The resolution 
was agreed to by voice vote. H. Res. 496, when combined with 
the enactment of H. Res. 22--a resolution introduced by Mr. 
Walden which cut House committee budgets by 5% at the beginning 
of the 112th Congress--represents the largest percentage cut to 
committee budgets since the 104th Congress.

                  MEMBERS' REPRESENTATIONAL ALLOWANCE

    The Committee has jurisdiction over the use of 
appropriations from the accounts of the U.S. House of 
Representatives for the Members' Representational Allowance 
(MRA) as well as official travel by Members and staff, and 
compensation, retirement and other benefits of Member office 
employees. The MRA is the annual authorization made to each 
Member of the House to obligate U.S. Treasury funds not to 
exceed a certain amount. These funds may be used by the Member 
to pay ordinary and necessary business expenses incurred by the 
Member and his or her congressional office employees in support 
of the conduct of the Member's official and representational 
duties on behalf of the district from which the Member is 
elected.
    On July 22, 2011, the House passed H.R. 2551, the 
Legislative Branch Appropriations Act, 2012. This bill 
appropriates $573,939,282 for Members' Representational 
Allowances for 2012. That amount represents a 6.4% reduction 
from the 2011 appropriation level for committee budgets.
    The Committee adjusted MRA authorizations by 6.4% to 
reflect the change in appropriation level. The total amount 
authorized for all Members' Representational Allowances for 
2012 was $597,313,512. The average MRA for 2012 was $1,354,452. 
This reduction, matching the appropriated funds provided for 
2012, promoted a greater level of efficiency within office 
operations.

             COMMISSION ON CONGRESSIONAL MAILING STANDARDS

    On January 9, 2012, the Commission on Congressional Mailing 
Standards (Franking Commission) sent a Dear Colleague letter on 
the pre-approval process for generic communication templates. 
Members can request a template advisory opinion for recurring 
communications, such as meeting notices, that will not change 
throughout the year.
    On January 17, 2012, the Franking Commission sent a Dear 
Colleague letter explaining the United States Postal Service 
price increases on mailing services. For example, the letter 
informed offices of the increase of the price of first class 
postage.
    As an advisory measure, the Franking Commission sent thirty 
Dear Colleague letters to the state delegations to notify them 
of the 90-day election cut-off dates. These letters explained 
that Members are prohibited from sending unsolicited mass 
mailings and mass communications 90 days prior to an election 
in which they will appear on a ballot as a candidate for public 
office.

         OVERSIGHT AND LEGISLATIVE ACTIVITIES OF THE COMMITTEE

Officers of the House

    One of the key responsibilities of the Committee is to 
provide oversight of the Officers of the House, whose 
organizations serve primary roles in the operation of the 
legislative process and in providing the day to day 
administrative and operational infrastructure necessary to 
support the Members and staff of the House.
            Clerk of the House
    The Office of the Clerk is charged with overseeing nine 
departments including the Office of Art and Archives, the 
Legislative Resource Center, and the Office of Official 
Reporters. However, the Clerk's primary responsibilities reside 
with the legislative activities of the House. This includes 
managing the legislative bills originating in the House as well 
as overseeing the voting system.
    On January 17, 2012, with the technical leadership and 
direction of House Leadership, the Committee on House 
Administration and the Committee on Rules, the Clerk launched a 
new website, docs.house.gov, to serve as the central location 
for all legislation to be considered by the House. The 
documents are displayed in XML, an open, machine-readable 
format. The Committee continues to work with the Clerk, House 
Leadership and the Committee on Rules regarding the posting 
requirements for Committee documents. Additionally, the 
Committee stayed apprised of the Clerk's progress on the 
development of a system to capture the financial disclosure 
requirements necessitated by the passage of S. 2038, the STOCK 
Act.
    The Committee worked with the Clerk's office on the 
implementation of Congressman Paulsen's legislative branch 
appropriations amendment, effective January 4, 2012, that 
prohibited the use of funds to deliver the Congressional Record 
to Member offices and the use of funds to deliver bills, 
resolutions and joint resolutions unless requested by a Member 
office. The Clerk made more copies available for pickup in the 
Legislative Resource Center and Rayburn Resource Center to 
accommodate Member office needs.
            Sergeant at Arms
    With the upcoming party conventions and presidential 
inauguration, oversight of the House Sergeant at Arms (HSAA) 
and the United States Capitol Police (USCP) is as always, a 
main focal point for the Committee. Working with our colleagues 
in the minority, the Committee continued to ensure that both 
the HSAA and the USCP have the appropriate resources and 
personnel to provide the high level of security to the Capitol 
grounds that we have come to expect. The Committee has resumed 
the regular bi-weekly oversight meetings with the HSAA and 
continues to meet with the USCP on a continuous basis to 
receive updates on topics vital to security.
    Regarding emergency response planning and execution, the 
Committee has asked the HSAA to continue the emergency response 
training of staff culminating in multiple emergency response 
drills and alternate chamber exercises. During the past 
quarter, the Office of Emergency Management (OEM) has conducted 
five separate evacuation drills, testing new procedures that 
were implemented based on the lessons learned from the real-
world evacuations of the earthquake on August 23rd, 2011. In 
addition, the Committee has asked the HSAA to explore technical 
solutions for emergency response messaging. As requested by the 
Committee, the HSAA has updated their website to include Law 
Enforcement Coordinator training and security tools to 
supplement district security efforts. In conjunction with the 
Law Enforcement Coordinator program, the HSAA continues to work 
the physical security outreach to Member district offices 
through ADT. Along with the ADT security outreach and the 
assignment of Law Enforcement Coordinators, the Committee asked 
the HSAA to determine possible recommendations for additional 
security measures for the beginning of Fiscal Year 2013.
            Chief Administrative Officer
    The Office of the Chief Administrative Officer (CAO) 
provides support functions for the House. The office supports 
the budget, finance, procurement, facilities, and information 
technology needs of the House and all of its components. The 
Committee is charged with overseeing the CAO's office.
    At the direction of the Committee, the CAO accomplished 
several process improvement and cost-savings initiatives over 
the past six months. These included expansion of the Purchase 
Card program, online ordering and payment for flags, and giving 
staff the option to receive earnings statements electronically 
rather than on paper.

House Information Resources

    The Committee continued to work with HIR to improve 
technological services and energy efficiency for the House 
community.
    The Committee also worked with HIR to support a House.gov 
website for mobile devices. This new website will enhance the 
experience for visitors and staff who use smart phones to 
access information about the House and the Capitol Complex. The 
URL is M.HOUSE.GOV.
    On February 2, 2012, the Committee held a conference on 
Legislative Data and Transparency in the Cannon Caucus room. 
One hundred and fifty attendees representing House, academic 
and private sector stakeholders participated. House, Library, 
and GPO administrative offices responsible for drafting and 
publishing legislative documents presented the work of their 
offices and participated in panel discussions with outside 
parliamentary, transparency, and technology speakers. The 
conference enabled the exchange of technical and policy 
information and helped House stakeholders map future 
transparency initiatives.

Inspector General

    House Rule II creates the Office of the Inspector General 
(OIG) and charges the Committee with oversight of the office. 
During the first half of the year the OIG, with the approval 
and support of the Committee, produced four management advisory 
reports and nine audit reports.
    Of particular note was the FY 2011 House Financial 
Statement Audit which the Committee approved on March 27, 2012. 
The House received a clean opinion on its financial statements 
and internal controls over financial reporting. This is a 
direct result of CAO Dan Strodel's ability to restore the 
House's good financial standing through the successful 
implementation of a comprehensive internal controls program and 
a new financial management system. It is an improvement over 
the 2009 and 2010 audits which received adverse opinions on 
internal controls. Also noteworthy, this is the first time in 
the history of the House that the audit has been completed this 
soon after the close of the fiscal year.
    The Committee also worked with the OIG to create awareness 
in the House community of several schemes involving newspaper 
subscriptions and renewals. Offices appreciated the 
notifications and were able to prevent payments to unscrupulous 
vendors.

The Architect of the Capitol

    The Architect of the Capitol (AOC) is responsible for the 
maintenance, operation, development, and preservation of the 
entire Capitol Complex, which includes 17.4 million square feet 
of buildings and more than 460 acres of land. Certain decisions 
regarding management of the House Office buildings and the 
House side of the Capitol reside with the House Office Building 
Commission, but the Committee supervises and oversees AOC 
implementation of all its programs.
    The Committee met regularly with the Architect of the 
Capitol, his senior staff, the House Office Building 
Superintendent, his senior staff, and other AOC management and 
staff. The Committee continued to monitor the operations of the 
AOC, including, but not limited to, the AOC's waste-to-energy 
initiative, which diverts up to 90% of the Capitol Complex's 
non-recyclable solid waste from landfills through the 
utilization of local waste-to-energy facilities, the American 
Veterans Disabled for Life Memorial (AVDLM), the Union Square 
(and Capitol Reflecting Pool) transfer and maintenance, the 
House Office Building garage repairs, the RFP solicitation 
(posted in March) for the Library's Residential Scholars 
Center, completion of the Botanic Garden's Bartholdi Fountain 
(which opened in April after a multi-year renovation), the 
Statue of Freedom Conservation, the Dome Skirt renovation, and 
its various staff changes. Committee staff and representatives 
from House Leadership and the AOC have continued to work 
through the planning phases and continued to spread awareness 
among Members and staff of major renovations of the Cannon 
House Office Building, Phase I of which is scheduled to begin 
in FY2017.

Office of Congressional Accessibility Services

    The Office of Congressional Accessibility Services (OCAS) 
was created by the Capitol Visitor Center Act of 2008. OCAS 
operates under the direction of the Congressional Accessibility 
Services Board and is charged with providing and coordinating 
accessibility services for individuals with disabilities 
including Members of Congress, officers and employees of the 
House and Senate, and visitors in the U.S. Capitol Complex. The 
Committee on House Administration is charged with overseeing 
the agency and meets with OCAS staff monthly.
    During the last six months, the Committee approved minor 
revisions to the Communication Access Real-time Translation 
(CART) and Sign Language Interpreting Services Policies. OCAS 
also worked with the Committee and the CVC to ensure the CVC 
experience is as accessible as possible. In the next few 
months, the audio-descriptive tour for Exhibition Hall will be 
complete. OCAS also provided accessibility services at various 
special events including the State of the Union Address, the 
unveiling of the slave labor commemorative marker in the CVC, 
and the Memorial Day Concert. Finally, OCAS trained over 1,000 
Congressional staff in the past six months on disability 
etiquette and accessibility services so they can better serve 
constituents with special needs.

Library of Congress

    The Committee's Subcommittee on Oversight conducted an 
oversight hearing on the Library of Congress (LOC) on April 18, 
2012, entitled ``Library of Congress: Ensuring Continuity and 
Efficiency During Leadership Transitions.'' Law Librarian David 
Mao, CRS Director Mary Mazanec, Register of Copyrights Maria 
Pallante, and Associate Librarian for Library Services Roberta 
Shaffer, testified before the subcommittee. Questions for the 
record were received on May 9.
    In March, oversight staff conducted a site visit to the 
LOC's Audio-Visual Conservation Center in Culpeper, VA. The 
Packard Campus continues to be the focus of the Library's 
FY2012 revolving fund legislative proposals for the Committee 
and the Committee's video archiving project.
    The Committee also oversaw the appointment of several high-
profile positions within the Library this year. David Mao was 
appointed the 23rd Law Librarian on January 4; Gayle Osterberg 
was appointed the new Director of Communications, effective 
January 30; Karen Keninger became the new Director of the 
National Library Service for the Blind and Physically 
Handicapped, effective March 26; and Mark Sweeney was named 
Director of Preservation on April 2.

Joint Committee on Printing and U.S. Government Printing Office

    The Government Printing Office (GPO) produces, preserves 
and distributes the official publications and information 
products of the Congress and federal government. At the end of 
the first session of the 112th Congress, William J. Boarman's 
recess appointment as Public Printer expired. Pursuant to 44 
U.S.C. 304, the Deputy Public Printer, Ms. Davita Vance-Cooks, 
assumed the duties of Acting Public Printer at the start of the 
second session of the 112th Congress. The Committee and the 
Joint Committee on Printing (JCP) Chairman, Representative 
Gregg Harper, provided support to Ms. Vance-Cooks during her 
transition and have actively ensured GPO continues to meet the 
goals set out in GPO's Strategic Plan for FY2012-2016.
    As demonstrated through recent actions, the Joint 
Committee's primary focus has been on decreasing Congress's 
reliance on tangible documents while still maintaining the 
government's interests in preservation, authentication, and 
availability for perpetuity. This year, the House printed fewer 
copies of the President's FY2013 Budget and adopted a 
resolution reducing by 50% the quantity of pocket Constitutions 
produced for the House. The House also adopted an amendment to 
the Legislative Branch Appropriations Act, 2013, offered by 
Representative Harper to strictly limit the printing of the 
2012 edition of the U.S. Code for the House, thereby providing 
Congress with significant savings. Finally, in this effort to 
eliminate unnecessary printing, the Committee and JCP continue 
aggressive outreach to Member and House committee offices 
urging them to opt out of receiving printed versions of House 
publications.
    The Committee on House Administration and JCP have also 
examined methods to make the House more efficient and 
transparent through its distribution of legislative 
information. In the first quarter of 2012, at the direction of 
the Committee on House Administration, the Government Printing 
Office and the Library of Congress unveiled a Congressional 
Record Application for tablet and mobile devices. This 
application is updated at the same time the information is 
released on GPO's Federal Digital System (FDsys) and is 
typically available before the print edition, thereby allowing 
the public at large to see the information concurrently with 
Congress.
    The Committee on House Administration has been working with 
GPO and its Inspector General to review billing practices for 
committees and support offices in the House. The goal of GPO is 
to use best practices, utilize additional controls and 
streamline the billing process for the House.
    Furthermore, the conference report to the Consolidated 
Appropriations Act, 2012 (Public Law 112-74), included a 
requirement for the National Academy of Public Administration 
(NAPA) to conduct an independent operational review of GPO to 
update past studies of GPO's operations and offer 
recommendations for additional cost saving opportunities beyond 
those that GPO has already implemented. The Committee on House 
Administration participated in interviews and has agreed to 
assist NAPA in various capacities.
    Finally, to help ensure the printing practices of the 
federal government are conducted at the best price and agencies 
are continuing to follow the law, the Joint Committee on 
Printing asked the Government Accountability Office to audit 
the total number of internal printing plants, the total amount 
of in-plant work produced, and the print procurement practices 
of all Federal departments and agencies.

Smithsonian

    The Committee serves as the primary legislative and 
oversight body for the Smithsonian Institution, a federal trust 
instrumentality composed of 19 museums, numerous research 
centers, and the National Zoo. Approximately two-thirds of the 
Institution's funding is from direct federal appropriations. 
Trust funds, which include private donations and revenues from 
museum shops, restaurants and theaters, provide the remaining 
funding.
    In early January 2012, the Committee became aware that 
Smithsonian Journeys, part of the Smithsonian Enterprises 
Division, began offering trips to Cuba as part of a people-to-
people exchange. Although the Smithsonian had met the legal 
requirements to offer such trips, the program raised concerns 
because of the benefits it could provide Cuba's regime, a 
nation which has remained on the U.S. Department of State's 
State Sponsors of Terrorism list since 1982. On January 18, 
2012, Chairman Lungren requested documentation regarding the 
Smithsonian's decision and the application to the Treasury to 
offer people-to-people exchanges. The Smithsonian responded on 
February 3, 2012. The materials provided generated additional 
questions and inquiries to the Smithsonian regarding the trips. 
In April, the Smithsonian indicated modifications would be made 
to the Cuba trip's planned itinerary including the addition of 
a briefing for trip participants by the U.S. Interests section 
in Havana. The first Smithsonian Journey's trip to Cuba 
occurred May 4-13, 2012 and the Committee requested post-trip 
materials for review.
    The Committee has also been actively engaged in providing 
regular oversight of the Smithsonian Institution through 
ongoing staff meetings and briefings.
    In February, Committee staff met with the newly-appointed 
Inspector General, Scott Dahl. Mr. Dahl provided background on 
ongoing initiatives of his office, including an assessment of 
the management of the design and construction of the National 
Museum of African American History and Culture (NMAAHC). On 
February 22, Committee staff attended the Groundbreaking 
Ceremony for the NMAAHC. Authorized in 2003, the NMAAHC is 
scheduled to open to the public in 2015. Construction costs are 
estimated at $500 million; the authorizing legislation provided 
for a 50-50 public-private funding ratio. The Museum will be 
built on a five-acre site adjacent to the Washington Monument 
on the National Mall. The Committee will continue to monitor 
progress of the NMAAHC construction to determine if the project 
remains on schedule and within budget.

Elections

    In response to the request made at the Subcommittee on 
Elections hearing on November 3, 2011, the Federal Election 
Commission (FEC) on December 2, 2011, provided to the Committee 
over 1,300 pages of documents relating to its enforcement, 
reports analysis, and audit processes. The Committee and the 
FEC entered into a period of consultation regarding redactions 
and exclusions proposed by the FEC. At the conclusion of this 
process, on May 23, 2012, the FEC posted the documents in the 
form agreed on its web site. This marked the first time the 
documents had been made available to the public and the 
regulated community. The FEC also announced that it will hold a 
public hearing on September 12, 2012, to provide an opportunity 
for the public to ask questions about the documents and the 
FEC's processes.
    The Committee continued to exercise its responsibilities 
for oversight of the Federal Election Commission and the 
Election Assistance Commission (EAC), reviewing information 
provided by the commissions and meeting with staff of both 
commissions and the FEC commissioners (the EAC has had no 
commissioners since December 2011) regarding the operations and 
policy initiatives of the commissions. The Committee also 
continued to seek the elimination of the Election Assistance 
Commission as provided for in H.R. 672 and H.R. 3463.

            ADDITIONAL OVERSIGHT ACTIVITIES OF THE COMMITTEE

Congressional Internship Program for Individuals with Intellectual 
        Disabilities

    Established by Representative Gregg Harper in the spring of 
2010, and administered by the Committee on House 
Administration, the Congressional Internship Program for 
Individuals with Intellectual Disabilities provides students 
with varying intellectual disabilities an opportunity to gain 
congressional work experience. The program, which includes 
spring, summer and fall sessions, pairs congressional offices 
with students from George Mason University's Mason LIFE 
Program--a postsecondary education program for young adults 
with intellectual disabilities. In 2010, the program started as 
a pilot with six House offices participating. By May 2012, 
fifty-seven Congressional offices had begun to participate in 
the program. Participating interns receive stipends for their 
work on Capitol Hill through a grant provided by The HSC 
Foundation.

                 HEARINGS AND MEETINGS OF THE COMMITTEE

    On April 18, 2012, the Subcommittee on Oversight held a 
hearing entitled ``Library of Congress: Ensuring Continuity and 
Efficiency During Leadership Transitions.'' There was one panel 
of witnesses for this hearing. The Subcommittee heard testimony 
from Mr. David Mao, Law Librarian for the Law Library of 
Congress, Ms. Roberta Shaffer, Associate Librarian for Library 
Services, Ms. Mary Mazanec, Director of the Congressional 
Research Service, and Ms. Maria Pallante, Register of 
Copyrights for the U.S. Copyright Office.

LEGISLATION WITHIN THE COMMITTEE'S JURISDICTION CONSIDERED BY THE HOUSE

    On February 1, 2012, the House considered H. Con. Res. 90, 
authorizing the printing of the 25th edition of the pocket 
version of the United States Constitution. The concurrent 
resolution was agreed to by unanimous consent.
    Also, on February 1, 2012, the House considered H. Res. 
496, adjusting the amount provided for the expenses of certain 
committees of the House of Representatives in the One Hundred 
Twelfth Congress. The resolution was considered under a motion 
to suspend the rules. The resolution was agreed to by voice 
vote.
    Also, on February 1, 2012, the House considered H.R. 3835, 
to extend the pay limitation for Members of Congress and 
federal employees. The House considered the bill under a motion 
to suspend the rules. The bill passed by a vote of 309-117.
    On February 9, 2012, the House considered H. Con. Res. 99, 
authorizing the use of Emancipation Hall in the Capitol Visitor 
Center for a ceremony to unveil the marker which acknowledges 
the role that slave labor played in the construction of the 
United States Capitol. The House passed the measure by 
unanimous consent.
    On March 1, 2012, the House considered H. Res. 562, 
directing the Office of the Historian to compile oral histories 
from current and former Members of the House of Representatives 
involved in the historic and annual Selma to Montgomery, 
Alabama, marches, as well as the civil rights movement in 
general, for the purposes of expanding or augmenting the 
historic record and for public dissemination and education. The 
resolution was considered under a motion to suspend the rules. 
The resolution was agreed to by a vote of 418-0.
    On March 22, 2012, the House considered H. Con. Res. 108, 
permitting the use of the rotunda of the Capitol for a ceremony 
as part of the commemoration of the days of remembrance of 
victims of the Holocaust. The House agreed to the concurrent 
resolution by unanimous consent.
    On May 7, 2012, the House considered H. Con. Res. 105, 
authorizing the use of Emancipation Hall in the Capitol Visitor 
Center for an event to celebrate the birthday of King 
Kamehameha. The House considered the concurrent resolution 
under a motion to suspend the rules. The concurrent resolution 
was agreed to by a vote of 376-0.
    On June 5, 2012, the House considered H. Con. Res. 128, 
authorizing the use of Emancipation Hall in the Capitol Visitor 
Center for an event to award the Congressional Gold Medal, 
collectively, to the Montford Point Marines. The House agreed 
to the concurrent resolution by unanimous consent.

                               APPENDIX A

     Committee Resolutions Adopted During the Period of This Report

              ADOPTION OF COMMITTEE'S VIEWS AND ESTIMATES

                     (Committee Resolution 112-11)

                         Adopted March 9, 2012

MINORITY VIEWS OF RANKING MEMBER ROBERT A. BRADY, REP. ZOE LOFGREN AND 
                        REP. CHARLES A. GONZALEZ

    It is our purpose in these Minority views to sharpen the 
focus on particular subject matter of great concern to us, as 
well as to express our disagreement with some of the views of 
the Committee Majority. We are especially concerned about the 
Committee's activities, and lack of activity, with respect to 
our jurisdiction over federal election law. Within these views, 
we provide an array of materials on that subject to create a 
record that we wish had been created during the last six 
months.

                               Elections


H.R. 5799, The Voter Empowerment Act

    In the wake of the 2010 election cycle, state legislatures 
passed an unprecedented number of restrictive voting laws. 
Obstacles to the ballot--new voter ID requirements, arbitrary 
voter registration restrictions including the elimination of 
same-day registration, shortening of early voting and absentee 
voting periods, requiring proof of citizenship, and making it 
more difficult to restore voting rights--have endangered our 
democracy. While the purported justification for these 
disenfranchising laws is to curb voter fraud, there is scant 
evidence that voter fraud of the type addressed by these laws 
actually exists. As a result of this phantom problem, millions 
of eligible Americans will lose their right to vote.
    The Florida Division of Elections, at the direction of 
Governor Rick Scott, is currently engaged in a large-scale 
voter purge effort in an attempt to remove eligible voters from 
their rolls. In 2011, Scott instructed then-Secretary of State 
Kurt Browning to remove from Florida's rolls a list of non-
citizens culled from the Department of Highway Safety and Motor 
Vehicle database, even though the database did not contain up-
to-date citizenship information. This effort produced a list of 
approximately 180,000 names. Then-Secretary Browning, however, 
considered the list too unreliable to be used.
    Secretary Browning resigned in February 2012, and Governor 
Scott continued with the purge, sending to local election 
officials instead a list of 2,600 names of people he claimed 
were non-citizens and directing that they be purged. He did so 
despite evidence that the list was based on unreliable data. So 
far, a considerable number of individuals identified on the 
list have come forward to prove their citizenship. Most county 
elections officials in the state have refused to use the list. 
On June 12th, the Department of Justice filed suit in the U.S. 
District Court in Miami seeking an injunction to stop the 
purge, alleging violations of the National Voter Registration 
Act. On June 27, 2012, U.S. District Judge Robert Hinkle denied 
the Department of Justice's request for an injunction.
    The Democratic Members of the Committee on House 
Administration refuse to stand idly by while the 
Constitutionally protected right to vote is mercilessly 
assailed. They worked extensively with the Democratic staff of 
the House Committee on the Judiciary, numerous voting and civil 
rights groups, and dozens of Members of Congress to draft 
legislation by which the federal government could meet its 
Constitutional obligation to regulate voting and protect the 
right to vote of millions of American citizens. As a result, 
Rep. John Lewis, with 126 original cosponsors, introduced H.R. 
5799, the Voter Empowerment Act (VEA), on May 17, 2012. The 
Voter Empowerment Act would protect and enhance the right to 
vote by providing access, protecting integrity, and ensuring 
accountability.
    The Majority has given no indication that the Committee 
will be considering the Voter Empowerment Act or any other 
legislation on the subject in the remaining six months of this 
Congress.

                PROVISIONS OF THE VOTER EMPOWERMENT ACT

1. Access to the polls

    If enacted, the VEA would provide increased access to polls 
to eligible citizens through a number of methods. Current voter 
registration processes can be inefficient and exclusionary and 
are vulnerable to mistakes or manipulation. The VEA modernizes 
the registration system and automatically and permanently 
registers all eligible, consenting citizens and updates changes 
of registration information, while also protecting voters' 
privacy. Further, by providing for online registration, the VEA 
alleviates time and transportation constraints that are 
sometimes obstacles to registering to vote.
    While every American's right to vote is under attack, 
voters with disabilities have always endured additional, often 
unique, challenges when attempting to cast a ballot. The VEA 
removes some of these impediments by ensuring that disabled 
voters have easy access to registration and absentee ballots, 
providing grants to states to ensure access to the ballot, and 
by exploring other methods of safe and effective voting for the 
disabled community.
    Young voters also face many obstacles at the polls. State 
laws with confusing and arbitrary residency requirements can 
pose particular challenges to college students. To combat this 
problem, the VEA requires universities that receive federal 
funding to offer and encourage voter registration to students. 
The bill also allows prospective voters as young as 16, if they 
will be 18 years old and otherwise eligible to vote at the next 
election, to pre-register. This will help to ensure that they 
are able to address all of the paperwork in advance, so that 
their right to vote is not denied simply because their 
birthdays fall too close to election day.
    The VEA would also make voting easier for members of our 
Armed Forces. By simplifying the registration process, ensuring 
that military voters are not improperly removed from 
registration lists, and ensuring that military absentee ballots 
make it to their destination, the VEA ensures that defending 
democracy abroad does not mean losing the right to vote at 
home.
    The VEA also makes voting more accessible to all eligible 
Americans by implementing ``vote by mail'' programs and 
requiring adequate notification if a polling place is moved.

2. Accountability

    If no one is held accountable for failures in election 
management, there is little incentive for improvement. As a 
result, even easily redressed problems are allowed to fester. 
State and local governments have no greater responsibility than 
protecting the republican system by which our leaders are 
elected. Though the new Majority failed to read that provision 
during their farcical exercise at the beginning of the 112th 
Congress, Section 4 of Article IV of the Constitution demands 
it of ``every State in this Union'' and calls upon the Federal 
government to ensure that this is so. The VEA, therefore, would 
take great strides to create new provisions by which citizens 
can hold accountable those who are responsible for running 
their elections.
    The first step to accountability is recognition of what 
problems there are. It is cliche to recognize that the many 
eyes of our millions of voters are apt to see many problems 
more quickly than even the best analysis. The VEA, therefore, 
creates a national voter hotline to ensure that problems can be 
reported, addressed, corrected, and prevented. The lessons 
learned from this centralized resource can also help every 
state and locality learn from the others, so that no mistake 
need be repeated and best practices can be learned.
    Sometimes mechanical failure prevents voters from casting a 
ballot. The VEA sets standards for voting machines, confirms 
that voters voted for their intended candidate, and provides a 
fail-safe paper copy of a cast ballot while still protecting 
voters' privacy.
    The Election Assistance Commission, created by the Help 
America Vote Act in the wake of Florida's disastrous handling 
of the 2000 election, is the only federal agency responsible 
for providing assistance and guidance to local election 
officials in administering elections. The VEA reauthorizes EAC, 
which saves cash-strapped states critical resources, to ensure 
the highest election standards are being met nationwide. The 
Majority has pursued a misguided course by unsuccessfully 
seeking to abolish the agency several times during the 112th 
Congress.

H.R. 4010, DISCLOSE 2012 Act

    On February 9, the Disclosure of Information on Spending on 
Campaigns Leads to Open and Secure Elections Act of 2012 
(``DISCLOSE 2012 Act'') was introduced by Rep. Chris Van 
Hollen. The DISCLOSE 2012 Act is similar to a bill passed by 
the House in the 111th Congress but defeated in the Senate 
after falling short of defeating a Republican filibuster 
despite receiving a strong and bipartisan majority vote.
    H.R. 4010 seeks to restore the American people's trust in 
our elections process in the aftermath of the U.S. Supreme 
Court's disastrous 2010 decision in Citizens United v. Federal 
Election Commission. Among the primary components of the 
legislation:
    
 The DISCLOSE 2012 Act would require any 
corporation, labor organization, section 501(c) organization, 
Super PAC or section 527 organization that spends $10,000 or 
more on a ``campaign-related disbursement'' to file a 
disclosure report with the Federal Election Commission within 
24 hours of the expenditure, and to require disclosure for each 
additional $10,000 or more that is spent. The FEC must post the 
report on its website within 24 hours of receiving it.
    
 The legislation strengthens the ``Stand by Your 
Ad'' requirements enacted under the Bipartisan Campaign Reform 
Act of 2002, ensuring that they apply to all outside spending 
groups. Any covered organization that pays for an independent 
expenditure or electioneering communication broadcast on radio 
or TV must disclose in the ads its top five funders (for a TV 
ad) or top two funders (for a radio ad). The head of the 
organization also must appear in the ad and state that he or 
she approves the broadcast message; and
    
 The legislation requires any covered organization 
that submits regular reports to its shareholders, members or 
donors to include in such reports any information that is 
required to be reported to the FEC under the legislation, and 
to post a hyperlink on its homepage to the location of the 
organization's disclosure report on the FEC website.
    We strongly support DISCLOSE 2012 Act and promptly called 
on the majority to hold hearings on the bill. As the majority 
declined to hold any hearings, Rep. Gonzalez, Ranking Member of 
the Subcommittee on Elections, asked for and received use of 
the Committee hearing room to hold a forum, ``The Most 
Expensive Seat in the House: The State of Our Campaign Finance 
System,'' to address the explosion of money in politics during 
the current election cycle, on April 18, 2012. [A full 
transcript of the Forum follows at the end of these views]

American Tradition Partnership, Inc. v. Bullock Amicus Brief

    In May, 2012, the Democratic Members of the Committee filed 
an amicus brief in support of the Montana State Supreme Court's 
decision in American Tradition Partnership, Inc. v. Bullock. 
That court in American Tradition Partnership upheld a Montana 
law banning corporations from making campaign contributions in 
state elections. The Democratic Members were hopeful that the 
U.S. Supreme Court would seize the opportunity to remedy some 
of the mess that has resulted from the ruling in Citizens 
United.
    The brief highlighted that Citizens United was decided on 
false premises. The Supreme Court based its decision on the 
idea that transparency and disclosures would prevent the 
corruption long associated with unfettered and undisclosed 
campaign contributions. However, in the years since the 
Citizens United opinion, attempts to require disclosure of 
corporate campaign financing have been unsuccessful. On June 
25, 2012, the Supreme Court summarily reversed the Montana 
State Supreme Court's decision.
    The Democratic Members view this outcome as a missed 
opportunity to reverse the ruling in Citizens United. While the 
Democratic Members would prefer to see the passage of 
legislation that mandates disclosure of corporate 
contributions, they maintained in their brief, and still 
maintain in light of the Supreme Court's ruling, that Citizens 
United was wrongly decided, under false premises and poses a 
grave threat to our democracy.

                        Smithsonian Institution


Service by staff on corporate boards

    We are concerned about recent discussions at the 
Smithsonian of a proposal to reverse current Smithsonian policy 
and the 2007 recommendations of the Independent Review 
Commission by allowing Smithsonian personnel to serve again on 
the boards of directors of profit and nonprofit corporations.
    In 2007, when scandals involving Smithsonian governance 
exploded, then-Chairman Brady criticized this practice of 
corporate board service and commended the Board of Regents for 
acting quickly to implement reforms. Now is not the time for 
backsliding. At a time of severe budget constraints and pay 
freezes, at the Smithsonian and government-wide, the Board has 
more important priorities than to encourage the staff to 
moonlight from their official responsibilities, and we hope 
this proposal will be dropped.
    We were pleased to learn that the Board has delayed 
potential action and may be having second thoughts.

Smithsonian Museum of African-American History and Culture

    On February 22, 2012, President Obama attended the ground-
breaking for the Smithsonian's National Museum of African 
American History and Culture on the National Mall. Congress 
authorized the Museum in 2003 and it is anticipated to open in 
2015. We urge fulfillment of Congress's bipartisan commitment 
of remaining Federal funds, funds which, along with private 
funds being raised by the Smithsonian, will help to ensure 
completion of this historic project on schedule.

Smithsonian Journeys to Cuba

    Under clause 1(k) of House Rule X, our Committee has no 
jurisdiction over foreign policy. This fact has apparently been 
overlooked in the majority's continuing criticism of 
Smithsonian Journeys's new ``people to people'' exchange trips 
to Cuba. The Majority complained in the Committee's ``Views and 
Estimates'' to the Budget Committee earlier this year that the 
Smithsonian's participation ``lends an imprimatur of government 
support for these trips.'' In the current activities report, 
the majority expresses concern that the trips could benefit the 
Castro regime.
    Just to be clear, it is the United States government, 
through the Departments of State, Treasury and other agencies 
which have authorized and licensed these trips.
    Smithsonian Journeys is part of Smithsonian Enterprises, 
which operates in the commercial marketplace to produce 
unrestricted trust fund revenues which may be spent for the 
Smithsonian's operations. The Smithsonian's travel program, 
like many similar ones by museums, universities and other 
organizations across the country, has been licensed by the 
Office of Foreign Assets Control of the Department of the 
Treasury, is consistent with American law and policy, and 
buttresses the Smithsonian's overriding mission to support 
``the increase and diffusion of knowledge.''
    As of late June, two trips to Cuba have been successfully 
conducted and two additional ones are scheduled by the end of 
the year.

                        Architect of the Capitol

    The minority was very disappointed by the decision to 
eliminate continued funding for the restoration and maintenance 
of the Capitol Dome. It has been well documented that the cast-
iron dome is eroding from water leaks stemming from pinholes in 
the Statute of Freedom. In Fiscal Year 2011, Phase I of the 
Dome restoration plan was started. This first Phase will repair 
and restore ironwork, sandstone and brick masonry along the 
skirt. The last time that the dome underwent major renovation 
was in 1960, 52 years ago. As the most recognizable symbol of 
our republic, we should spend what is prudent to properly care 
for this icon.

Cuts are a risk to safety

    Lead is a health hazard and, according to the EPA, exposure 
could result in high blood pressure or reproductive or memory 
problems, with more significant risks for children including 
nervous system and brain development. Phase IIA funds would 
allow for the renovation and repair of the dome's exterior 
including, priming, resurfacing, and repainting of the Dome's 
exterior.
    In addition, Phase II funds would allow safety improvements 
for the AOC workers that maintain the dome such as a new fall 
protection system. The Architect of the Capitol included in his 
statement to the Legislative branch appropriation bill that, 
``The planned Phase IIA repairs . . . will provide the 
appropriate life-safety systems are in place for the protection 
of AOC employees charged with the continuous care and 
maintenance of the Dome.'' Without these steps, the millions of 
visitors to the Capitol may be exposed to potentially unsafe 
conditions during their visit.

Dome will deteriorate further

    The next phase in Dome funding would prevent a further 
degradation to the dome. Continued deferred maintenance only 
increases corrosion to the ironwork on the exterior of the 
dome, and without the gutter system water will continue to 
deteriorate the dome.

Deferred maintenance means higher costs

    According to the Architect of the Capitol, if the project 
is not funded this fiscal year, the total cost of the 
rehabilitation of the dome will increase due to the rapidly 
deteriorating conditions. Deferred maintenance may also mean 
that the taxpayer money spent on Phase I will be wasted if the 
first part of work to be completed this fall needs to be re-
done.

Major Architect and Engineering Groups Opposed

    A coalition of architectural, engineering and trade groups 
sent a letter to Congressional leaders in opposition to the 
cuts to the AOC's FY2013 budget, warning of further 
deterioration of the U.S. Capitol, as well as increased costs 
and safety concerns. Signatories include: American Institute of 
Architects, American Society of Civil Engineers, the National 
Trust for Historic Preservation, the Glass Association of North 
American, the Illuminating Engineering Society of North 
America, Ingersoll Rand, the Institute for Market 
Transformation, the National Institute of Building Sciences, 
AEC Science & Technology, Ecobuild America, American Society of 
Heating, Refrigerating and Air-Conditioning Engineers, and 
International Facility Management Association. These are 
experts in their fields and their opinions should be respected.

Union Square

    We regret that neither this Committee nor the Senate 
Committee on Rules and Administration has yet reported a bill 
to resolve questions left unanswered when Congress, utilizing 
an appropriations bill, transferred control of Union Square 
from the National Park Service to the Architect of the Capitol 
last December. Given the apparent bipartisan agreement over the 
policy issues presented, we are mystified at the delay.
    Congress transferred control of Union Square, the small 
portion of the National Mall at the foot of Capitol Hill 
containing the Reflecting Pool, to the Architect on the 
recommendation of security officials concerned about the 
potential effects of a comprehensive Park Service plan to 
renovate the Mall, which could offer significant implications 
for security of the Capitol and the Capitol Grounds. To avoid 
entangling the Park Service's plan to improve the entire Mall 
with the unique security issues surrounding the Capitol, 
Congress simply incorporated Union Square into the Capitol 
Grounds and got out of the Park Service's way. Unfortunately, 
the transfer provision failed to state whether the Architect 
should allow limited commercial activity on the Square, as the 
Park Service had traditionally done, or instead administer 
Union Square consistently with the rest of the Grounds, where 
commercial use is generally prohibited by law.
    Our Committee staffs worked diligently with bipartisan 
Senate Rules Committee staff to fashion a provision to maintain 
the Park Service's practice of permitting limited commercial 
use and provide the Architect, the Capitol Police Board and the 
Capitol Police with the necessary legal authority. However, the 
House Appropriations Committee has complicated the process by 
including a somewhat different provision in the Legislative 
Appropriations legislation for fiscal year 2013.
    Whatever the merits of the Appropriations Committee's 
provisions, we are worried that if the legislative committees 
of both Houses simply yield to the appropriations bill as a 
vehicle, the questions and potential legal problems caused by 
the transfer provision enacted last December will very likely 
have remained unresolved for at least a full year and probably 
longer. In the meantime, the Architect, the Capitol Police 
responsible for administering and protecting Union Square, and 
the commercial firms interested in continuing to use it, 
deserve prompt answers to these concerns. We believe the House 
Administration Committee should report the necessary 
legislation and work with others to pass it through the House 
as soon as possible.

                          Library of Congress


Library Hearing and Copyright

    We thank Chairman Gingrey for convening the Oversight 
Subcommittee on April 18, 2012, to examine continuity and 
efficiency at the Library of Congress in a period of 
transition. The subcommittee received testimony from four 
recently appointed heads of key service units (Ms. Roberta 
Shaffer, Associate Librarian for Library Services; Ms. Maria 
Pallante, the Register of Copyright; Dr. Mary Mazanec, 
Director, Congressional Research Service; and Mr. David Mao, 
the Law Librarian of Congress).
    Transition is never simple and the tasks undertaken by each 
of the service-unit leaders will not be easy in an era of 
shrinking budgets. We hope that each and every member of 
Library management will bring to the Committee's attention any 
concern we may need to address, especially in areas where the 
Library provides services directly to the American public. In 
order to provide proper oversight of Library activities, we 
will continue to monitor the operations of these service units 
to ensure a smooth leadership transition--particularly the 
Register of Copyrights, whose travel itinerary and public 
comments have caused some to question her impartiality. We 
trust that the Register, whose position is largely ministerial, 
will redouble efforts to allay such concerns.

Rayburn Research Center

    The Congressional Research Service, in response to budget 
cuts, has been reducing some of its traditional services to 
Members and staff. In recent years, it has closed the CRS 
reference centers in the U.S. Capitol and the Longworth 
Building and drastically reduced the size of the congressional 
staff reading room in the Madison Building under the guise of a 
``renovation'' which transferred most of the space to library 
communications staff.
    Changes in the way Members and staff seek and use 
information provide some justification for these cutbacks. 
However, when CRS decided to pull back its staff and resources 
from the Rayburn Research Center, the Committee staff thought 
it odd that they still wanted to retain use of the room for 
other CRS functions. A bipartisan recommendation by the 
Committee was made to the House Leadership that, since CRS 
would no longer be providing useful functions to the House in 
this space, that the House should reclaim the room to meet its 
own needs.

                     DEFENSE OF MARRIAGE ACT (DOMA)

    We continue to be confused by the Republican Leadership's 
stubborn insistence that taxpayer dollars be used to defend 
discrimination. In case after case, judges have held DOMA an 
unconstitutional violation of the Fifth Amendment to the U.S. 
Constitution, just as the Obama Administration stated in their 
explanation for the discontinuance of defending constitutional 
challenges to Section 3.
    The House has filed briefs in twelve DOMA lawsuits thus 
far, and out of the four that have been adjudicated, the House 
has lost in each matter based on the courts' opinion that 
Section 3 of DOMA is unconstitutional.
    On February, 22, 2012, in Golinski v. OPM, a Federal 
district court judge in California found DOMA unconstitutional 
under the Equal Protection clause and protections afforded by 
the Fifth and Fourteenth Amendments.
    On May 24, 2012, in Dragovich v. United States Department 
of Treasury, a federal judge in California found the denial of 
benefits under DOMA unconstitutional for the same reason.
    On May 31, 2012, in Gill v. OPM, DOMA was ruled 
unconstitutional by the First Circuit Federal Appeals Court in 
Boston. In a unanimous decision, the three judge panel found 
that the Federal Government cannot deny rights and privileges 
such as pension, tax and health benefits to same sex couples in 
states where they can legally marry.
    On June 6, 2012, in Windsor v. United States, a U.S. 
District judge for the Southern District of New York found 
section 3 of DOMA unconstitutional.
    Despite these repeated losses, the Majority continues to 
abuse precious taxpayer dollars for perceived political 
advantage and to prolong discrimination which has gone on far 
too long.

   VIEWS OF REP. CHARLES A. GONZALEZ (TX-20) TO ACCOMPANY THE THIRD 
       SEMIANNUAL REPORT ON ACTIVITIES OF THE COMMITTEE ON HOUSE 
                             ADMINISTRATION

    After consideration of the Third Semiannual Report on 
Activities of the Committee on House Administration prepared by 
the Majority, I find that I cannot approve it. The principal 
reason for my disapproval is that the report is not a 
comprehensive accounting of the activities of the Committee. 
The extent of this failure is partially indicated by the issues 
covered by the Minority Views submitted by Ranking Member Brady 
that find no mention in the Majority's report. The Committee is 
obligated to make a more complete accounting to the House of 
what the Committee has done than was offered by the Majority. 
Because it fails to meet that standard, I disapprove of the 
Majority's report.

                                       Charles A. Gonzalez,
                                                Member of Congress.

   ``The Most Expensive Seat in the House: The State of Our Campaign 
                            Finance System''

     A Congressional Forum Reviewing the Impact of Citizens United

    As soon as the Supreme Court handed down its decision in 
Citizens United, the need for a review of our campaign finance 
system was clear. Regardless of how one viewed that decision, 
it was indisputable that it represented a major change in how 
campaigns for federal offices would be run. The magnitude of 
this change was only made clearer by the 2010 election. After 
the Republican Majority blocked all efforts to examine these 
changes and their significance for the country, the Ranking 
Member of the Subcommittee on Elections convened a 
congressional forum in the hopes that he could shed some light 
on this subject. When the Court ruled, they had no idea what 
the impact of their decision would be. Now, we can show what it 
has been and what we can expect for the future. This subject is 
too important to go unremarked upon by the House of 
Representatives. The following will lay out a brief history of 
the changes that led to the forum, what was discussed, and what 
comes next. It is hoped that this record will inform the 
American people and lay a foundation for the essential 
congressional action to come.

            A CAMPAIGN FINANCE SYSTEM NIXON WOULD HAVE LOVED

    In 2012, we commemorate the 40th anniversary of the scandal 
known as Watergate. Watergate remains a touchstone, 
exemplifying many of the worst excesses of political scandal 
and shaming our entire country.\1\ The most shocking thing 
about this anniversary, however, is that many of the things 
that made Watergate so shocking wouldn't even be illegal today.
---------------------------------------------------------------------------
    \1\Bernstein, Jonathan, ``Nixon Against Government'', ``A plain 
blog about politics'', June 08, 2012 (http://
plainblogaboutpolitics.blogspot.com/2012/06/nixon-against-
government.html).
---------------------------------------------------------------------------
    ``A lot of us believe Watergate might never have happened 
without all that money sloshing around.''\2\ That's what John 
Dean told the Washington Post's Dan Eggen in early June, but 
Eggen notes that, today:
---------------------------------------------------------------------------
    \2\Dan Eggen, ``Post-Watergate campaign finance limits undercut by 
changes'', The Washington Post, June 16, 2012 (http://
www.washingtonpost.com/politics/post-watergate-campaign-finance-limits-
undercut-by-changes/2012/06/16/gJQAinRrhV_print.html).

        there's little need for furtive fundraising or secret 
        handoffs of cash. Many of the corporate executives 
        convicted of campaign-finance crimes during Watergate 
        could now simply write a check to their favorite Super 
        PAC or, if they want to keep it secret, to a compliant, 
        non-profit group. Corporations can spend as much as 
        they want to help their favored candidates, no longer 
        prohibited by law from spending company cash on 
        elections.\3\
---------------------------------------------------------------------------
    \3\Id. It is, of course, also worth noting that some of those 
executives didn't suffer all too greatly at the time, with one rising 
to spend 18 years as a member of the United States Senate.

    Even opponents of campaign finance regulation agree that 
the current system is a threat. Former Republican National 
Committee Chairman Haley Barbour has called it a ``bad system'' 
that leads to donations given ``under the table''.\4\ While 
Barbour's preferred solution is to allow unlimited donations to 
candidates and political parties, we are encouraged that he 
recognizes some of the dangers inherent in the present system. 
Those dangers were laid out most starkly more than 30 years ago 
by John Terry Dolan, the founder of National Conservative 
Political Action Committee, another group\5\ seeking to 
influence elections through independent expenditure:
---------------------------------------------------------------------------
    \4\Justin Worland, ``Haley Barbour Criticizes Campaign Finance 
Law'', Roll Call, June 15, 2012 (http://atr.rollcall.com/haley-barbour-
criticizes-campaign-finance-law/).
    \5\Chuck Lane, ``NCPAC's Waterloo: TAKING SIDES'', The Harvard 
Crimson, September 25, 1982 (http://www.thecrimson.com/article/1982/9/
25/ncpacs-waterloo-pbbbefore-1980-a-hit/).

        Groups like ours are potentially very dangerous to the 
        political process. We could be a menace, yes. Ten 
        independent expenditure groups, for example, could 
        amass this great amount of money and defeat the point 
        of accountability in politics. We could say whatever we 
        want about an opponent of a Senator Smith and the 
        senator wouldn't have to say anything. A group like 
        ours could lie through its teeth and the candidate it 
        helps stays clean.\6\
---------------------------------------------------------------------------
    \6\Myra MacPherson, ``The New Right Brigade; John Terry Dolan's 
NCPAC Targets Liberals And the Federal Election Comission [sic]'', The 
Washington Post, August 10, 1980.

    These are chilling words, but their truth is beyond 
question. A recent study of campaign ads in the 2012 
presidential race was headlined, ``Presidential Ads 70 Percent 
Negative in 2012, Up from 9 Percent in 2008''.\7\ One of the 
reasons for this is the 1100% increase in spending by interest 
groups, 86% of which has gone for negative advertising.\8\ 
Restore Our Future, Inc., for example, spent $42.5 million on 
independent expenditures between December 08, 2011, and April 
11, 2012, of which 93.5% was spent on negative ads.\9\ These 
ads are also filled with misleading and outright false 
allegations.
---------------------------------------------------------------------------
    \7\Erika Franklin Fowler, ``Presidential Ads 70 Percent Negative in 
2012, Up from 9 Percent in 2008'', Wesleyan Media Project, May 02, 2012 
(http://mediaproject.wesleyan.edu/2012/05/02/jump-in-negativity/).
    \8\Paul Steinhauser, ``Study: Campaign ads much more negative than 
four years ago'', CNN.com, May 03, 2012 (http://
politicalticker.blogs.cnn.com/2012/05/03/study-campaign-ads-much-more-
negative-than-four-years-ago/).
    \9\Federal Election Commission, ``Report on Independent 
Expenditures of Restore Our Future, Inc.''', retrieved June 18, 2012 
(http://query.nictusa.com/cgi-bin/com_supopp/C00490045/).
---------------------------------------------------------------------------

                        UNACCOUNTABLE AND UNTRUE

    According to the Annenberg Public Policy Center of the 
University of Pennsylvania, ``from December 1, 2011 through 
June 1, 2012, 85% of the dollars spent on presidential ads by 
four top-spending third-party groups known as 501(c)(4)s were 
spent on ads containing at least one claim ruled deceptive by 
fact-checkers''.\10\ The highest spender covered was Crossroads 
GPS as ``contain[ing] so many factually misleading attacks\11\ 
that it took two articles for us to cover them\12\ all.''\13\ 
In Annenberg's analysis of third-party spending from the Iowa 
Caucuses through the Wisconsin primary, ``23.3 million (56.7%) 
of the 41.1 million dollars were spent on 19 ads containing 
deceptive or misleading claims.''\14\ The pro-Romney Super PAC 
``Restore Our Future, Inc.'' was responsible for 89% of the 
misleading funding, and ``outspent the pro-Gingrich and pro-
Santorum super PACs by 20 to 1.''\15\ There is no question that 
these ads were designed to help the Republican Party to defeat 
President Obama, and that those by Restore Our Future helped 
Mitt Romney to become its presidential nominee, but neither the 
Republican National Committee nor Romney himself would ``have 
to say anything'' and each ``stays clean'', exactly as Mr. 
Dolan warned.
---------------------------------------------------------------------------
    \10\Annenberg Public Policy Center, ``High Percent of Presidential 
Ad Dollars of Top Four 501(c)(4)s Backed Ads Containing Deception, 
Annenberg Study Finds'', June 20, 2012 (http://www.docstoc.com/docs/
123115463/High-Percent-of-Presidential-Ad-Dollars-of-Top-Four-
501(c)(4)s-Backed-Ads-Containing-Deception-Annenberg-Study-Finds). The 
study notes that, ``[a]s of June 1st, no Democratic leaning 501(c)(4) 
had paid for advertising in the presidential race.'' The missing comma 
after ``2011'' is in the original.
    \11\FactCheck.org, ``A Bogus Tax Attack Against Obama'', May 17, 
2012 (http://factcheck.org/2012/05/a-bogus-tax-attack-against-obama/).
    \12\FactCheck.org, ```Obama's Promise,' Part II'', May 18, 2012 
(http://factcheck.org/2012/05/obamas-promise-part-ii/).
    \13\FactCheck.org, ``Soft Glove, Same GPS Fist'', May 23, 2012 
(http://factcheck.org/2012/05/soft-glove-same-gps-fist/). This article 
is a description of Crossroads GPS's second major ad, which 
FactCheck.org summarizes as, ``an attack [that] uses factual claims to 
deceive, not to inform.''
    \14\FlackCheck.org, ``APPC calculates dollars spent by four highest 
spending third party groups on deceptive TV ads'', April 27, 2012 
(http://www.flackcheck.org/press/april-27-2012/) ` FlackCheck.org, 
``Calculating Dollars Tied to Deception in the 2012 Republican 
Presidential Ads--FlackCheck.org'', YouTube, April 27, 2012 (http://
www.youtube.com/watch?v= j5PdH0AvRh4).
    \15\FlackCheck.org, ``APPC calculates dollars spent by four highest 
spending third party groups on deceptive TV ads'', April 27, 2012 
(http://www.flackcheck.org/press/april-27-2012/).
---------------------------------------------------------------------------
    This ability to smear an opponent with falsehoods 
unreservedly is an insidious twist in American campaigns. When 
advertisements are produced by a political campaign, the 
candidate risks a backlash if the public perceives her as lying 
to them. The requirement a candidate ``Stand-by-your-ad'' via 
the now familiar, ``I'm Mitt Romney, and I approved this 
message'' tag at the beginning or end of each advertisement, 
further cemented that check.\16\ But Mr. Romney can say--
indeed, to avoid legal liability he must say so and honestly--
that he had no control over those Crossroads GPS or Restore Our 
Future advertisements, disclaiming any responsibility for their 
deceptive\17\ content. Dr. Ornstein explained the impact of 
this unaccountability during the forum:
---------------------------------------------------------------------------
    \16\Dr. Ornstein said at the forum, ``one of the most significant 
and commendable provisions of the Bipartisan Campaign Reform Act was 
the `stand by your ad' provision that David Price authored.'' See 
Transcript 47:929-32 (http://www.youtube.com/watch?v=tTt5VbHUxNA#t= 
3105).
    \17\Annenberg Public Policy Center, ``High Percent of Presidential 
Ad Dollars of Top Four 501(c)(4)s Backed Ads Containing Deception, 
Annenberg Study Finds'', see note 10, supra.

        [I]t really used to be [that] Members of Congress . . . 
        were recruited to come here by people in their 
        communities who went to them and said, ``You have done 
        wonderful things. You have built a great reputation. 
        How about spending some time in public service?''
          Now if I wanted to go to somebody like that now, I 
        would say, ``It is time to spend some time in public 
        service. And here is what is going to happen: The first 
        thing is, brace yourself for the $5 million that will 
        come in by your opponent and other related groups, 
        designed to strip the bark off you and destroy that 
        reputation you have spent your career building. And 
        they will know they have succeeded when your kids come 
        home from school crying and say they can't go back 
        anymore because of all the embarrassment that they face 
        from their friends and fellow students.''\18\
---------------------------------------------------------------------------
    \18\See Transcript 79:1619-34 (http://www.youtube.com/
watch?v=tTt5VbHUxNA#t= 5380).

Is this really the world we want? Is this what campaign finance 
is supposed to mean? Is this what elective office is supposed 
to be?

                    A NEW WORLD OF CAMPAIGN FINANCE

    In 2010, the law of campaign finance changed dramatically. 
In January, the Supreme Court released its decision in Citizens 
United v. FEC (558 U.S. (2010), 130 S.Ct. 876), striking down 
limitations on spending for so-called ``independent 
expenditures''. In March, the Court of Appeals for the District 
of Columbia Circuit released its decision in SpeechNOW.org v. 
FEC (599 F.3d 686) (2010), holding that the logic of Citizens 
United meant that such unlimited donations could also go to 
political action committees (PACs). Thus was born the Super 
PAC. This represented a major change in the law surrounding 
campaign finance. Major parts of the Bipartisan Campaign Reform 
Act of 2002, properly known as ``Shays-Meehan'' but more 
commonly referred to as ``McCain-Feingold'',\19\ a law duly 
passed less than eight years earlier with bipartisan majorities 
by a divided Congress,\20\ were ruled unconstitutional. By 
March, outside spending had increased 767% over the previous 
mid-term election.\21\
---------------------------------------------------------------------------
    \19\Pub. L. No. 107-155, 116 Stat. 81 (codified in various sections 
of title 2 of the United States Code).
    \20\148 Cong. Rec. H465-66 (http://clerk.house.gov/evs/2002/
roll034.xml); 148 Cong. Rec. S2160-61 (http://www.gpo.gov/fdsys/pkg/
CREC-2002-03-20/pdf/CREC-2002-03-20-pt1-PgS2096- 2.pdf).
    \21\Richard Hasen, ``The Numbers Don't Lie: If you aren't sure 
Citizens United gave rise to the super PACs, just follow the money'', 
Slate.com, March 09, 2012 (http://www.slate.com/articles/
news_and_politics/politics/2012/03/
the_supreme_court_s_citizens_united_decision_
has_led_to_an_explosion_of _campaign_spending_.html).
---------------------------------------------------------------------------
    This was clearly a new world and it was recognized as such. 
In his address on the State of the Union in January, 2010, days 
after the decision in Citizens United and before that in 
SpeechNow, President Obama spoke of how, ``the Supreme Court 
reversed a century of law that I believe will open the 
floodgates for special interests--including foreign 
corporations--to spend without limit in our elections.''\22\ 
The President's statement, though certainly not without 
foundation,\23\ was criticized even as he was making it and by 
no less an authority than Associate Justice Samuel Alito.\24\ 
Clearly, this was an issue of great moment and one it was 
incumbent on Congress to address. The Committee on House 
Administration, recognizing our role in oversight over 
elections and campaign finance law, held three hearings on the 
subject between February and May, 2010\25\, and marked up the 
DISCLOSE Act\26\ which passed the House on June 24, 2010.\27\ 
While companion legislation was blocked in the Senate by 
Republican filibuster, a strong majority of 58 senators voted 
in support.\28\
---------------------------------------------------------------------------
    \22\Barack Obama, ``Remarks by the President in State of the Union 
Address'', January 27, 2010 (http://www.whitehouse.gov/the-press-
office/remarks-president-state-union-address).
    \23\See Citizens United v. FEC, 130 S.Ct. 876, 930 (Stevens, J., 
dissenting).
    \24\Martin Kady, II, ``Justice Alito mouths `not true''', 
Politico.com, January 27, 2010 (http://www.politico.com/blogs/
politicolive/0110/Justice_Alitos_You_lie_moment.html).
    \25\H.R. Rep. No. 111-492, pt. 1 at 39-40 (2010) (http://
www.gpo.gov/fdsys/pkg/CRPT-111hrpt492/pdf/CRPT-111hrpt492-pt1.pdf).
    \26\H.R. 5175, 111th Cong. Sec. 2 (2010) http://thomas.loc.gov/cgi-
bin/bdquery/z?d111:h.r.05175:. See also Chris Van Hollen, Section-by-
Section Summary of ``DISCLOSE Act'' (http://vanhollen.house.gov/
UploadedFiles/DISCLOSE_Summary_042910.pdf).
    \27\156 Cong. Rec. H4828 (http://clerk.house.gov/evs/2010/
roll391.xml).
    \28\156 Cong. Rec. S6285 (http://www.gpo.gov/fdsys/pkg/CREC-2010-
07-27/pdf/CREC-2010-07-27-pt1-PgS6278-5.pdf). N.B. While a supporter of 
the legislation, Senate Majority Leader Harry Reid changed his vote 
from Yea to Nay for a procedural reason, q.v., David M. Herszenhorn, 
The New York Times, July 27, 2010 (http://www.nytimes.com/2010/07/28/
us/politics/28donate.html).
---------------------------------------------------------------------------

                   THE OPENING OF THE 112TH CONGRESS

    All of these steps, of course, were taken when the 
implications of Citizens United and SpeechNow remained largely 
speculative, however. Until the next election had run its 
course, there was limited data on which to act. That data soon 
arrived. In the 2010 election cycle, outside spending rose to 
$299.8 million, an increase of 335% over the previous mid-term 
election, which had itself set a new record for mid-terms.\29\ 
``[I]ndependent expenditures by PACs, groups and individuals 
jumped from $43.6 million in 2008 to $204 million in the 2010 
cycle'', an increase of 369%.\30\ Spending on the average House 
campaign rose 32%, in real dollars, over 2008. This was the 
largest increase in decades despite coming in a mid-term 
election when we were still recovering from the Great 
Recession. Such increases have historically come in 
presidential election years.\31\ Such drastic change called on 
the Committee on House Administration, as the congressional 
body with jurisdiction over this issue, to act, especially as 
races for House seats are the most likely to be affected by 
independent expenditures.\32\
---------------------------------------------------------------------------
    \29\Center for Responsive Politics, ``Total Outside Spending by 
Election Cycle, Excluding Party Committees'', Retrieved June 26, 2012 
(http://www.opensecrets.org/outsidespending/cycle_tots.php).
    \30\Cynthia Bauerly, Keynote Address to Symposium, ``Accountability 
After Citizens United'', April 29. 2011 (http://www.brennancenter.org/
content/pages/accountability_after_citizens_ 
united_transcript_section_ii).
    \31\See ``Campaign Expenditures Since 1990--2012 Dollars'', 
Appendix B. http://democrats. cha.house.gov/sites/
democrats.cha.house.gov/files/Campaign%20Expenditures%20Since%201990% 
20-%202012%20Dollars.xlsx.
    \32\E.J. Dionne, Jr., ``Secret money fuels the 2012 elections'', 
The Washington Post, June 13, 2012 (http:''www.washingtonpost.com/
opinions/secret-money-fuels-the-2012-elections/2012/06/
13gJQAsZ4FaV_story.html).
---------------------------------------------------------------------------
    The newly empowered Majority did nothing.
    In August, 2011, campaign finance became a national story 
when it was revealed that someone or some ones had created 
phony, shell corporations just to disguise their donations to 
Restore Our Future, Inc., the Super PAC created to support Mitt 
Romney's run for president.\33\ Mr. Gonzalez wrote to FEC and 
the Department of Justice urging them to investigate whether 
this practice was a violation of federal law, by the donor or 
by Restore Our Future.\34\
---------------------------------------------------------------------------
    \33\Campaign Legal Center, ``FEC Complaint Filed Against Apparent 
`Straw Company' that Gave $1 million to Romney-linked `Super PAC''', 
August 05, 2011, (http://www. campaignlegalcenter.org/
index.php?option=com_content`view=article`id=1427:august_5-2011-
fec-complaint-filed-against-apparent-straw-company-that-gave-1-million-
to-romney-linked-super-pac-`catid= 63:legal-center-press-
releases&Itemid=61) & Campaign Legal Center, ``FEC and DOJ Asked to 
Investigate More `Straw Companies' Making Million Dollar Contributions 
to Romney-linked `Super PAC''', August 11, 2011 (http://
www.campaignlegalcenter.org/index. 
php?option=com_content&view=article&id=1436:-fec-and-doj-asked-to-
investigate-more-straw-companies-making-million-dollar-contributions-
to-romney-linked-super-pac-8-11-11&catid= 63:legal-center-press-
releases&Itemid=6).
    \34\Committee on House Administration, Democratic Office, 
``Gonzalez Calls for Investigation of Potential Campaign Finance Law 
Violations'', August 16, 2011 (http://democrats.cha.house.gov/press-
release/gonzalez-calls-investigation-potential-campaign-finance-law-
violations).
---------------------------------------------------------------------------
    The Majority took no action.
    In September, 2011, an article on the front page of the New 
York Times concluded with a startling admission: ``I had 
someone else pay for me to go [to ``a recent Romney fund-
raising event,''] because I didn't want people to know I was 
there.''\35\ In October, 2011, it was reported that teenage 
children with no obvious means of income had maxed out their 
donations to the presidential campaign of Texas Governor Rick 
Perry.\36\ Both actions would be illegal under the Federal 
Election Campaign Act.\37\ October also saw revelations of 
financial misconduct surrounding the campaign of Hermann Cain, 
revelations that would lead to a federal probe.\38\
---------------------------------------------------------------------------
    \35\Mimi Swartz, ``A Crisis of Confidence Deep in the Heart of 
Texas'', The New York Times, September 28, 2011 (http://
www.nytimes.com/2011/10/02/magazine/a-crisis-of-confidence-deep-in-the-
heart-of-texas.html).
    \36\Christina Wilkie, ``Contributions To Rick Perry From Big 
Donors' Children Raise Questions'', The Huffington Post, October 25, 
2011 (http://www.huffingtonpost.com/2011/10/25/perry-2012-donations-
children_n_1030771.html).
    \37\2 U.S.C. 441f.
    \38\Daniel Bice, ``Activities of former Cain operative 
scrutinized'', Milwaukee Journal Sentinel, March 29, 2012 (http://
www.jsonline.com/watchdog/noquarter/activites-of-former-cain-operative-
scrutinized-nc4pt5q-145029735.html).
---------------------------------------------------------------------------
    The Majority was uninterested.\39\
---------------------------------------------------------------------------
    \39\It is worth noting that Stephen Colbert, whose platform is 
broad but limited to approximately 88 minutes per week, and whose 
jurisdiction is broader than that of any single congressional 
committee, has expended vastly more time exploring our campaign finance 
law than has the House Committee responsible for elections in the 
entire 112th Congress. Mr. Colbert has spent hours of airtime 
explaining and exploring how campaigns are financed and the 
implications thereof. Millions of Americans know what Super PACs are 
only because of Mr. Colbert's efforts and his explanations, with the 
able assistance of former FEC Chairman and his ``personal lawyer'' 
Trevor Potter, are so good that they played an invaluable role in the 
forum. Anyone seeking an entertaining and educational introduction to 
the issue would do well to visit http://www.colbertnation.com/video/
tags/Colbert%20Super%20PAC and simply start watching some of the many 
clips. See also Dahlia Lithwick, ``Colbert v. the Court: Why, in the 
battle over Citizens United, the Supreme Court never had a chance'', 
Slate.com, Feb. 2, 2012 (http://www.slate.com/articles/news--and--
politics/jurisprudence/2012/02/stephen_colbert_is_ 
winning_the_war_against_the_supreme_court_and_citizens_united_ 
.single.html).
---------------------------------------------------------------------------
    Much ado was made of the Subcommittee on Elections hearing 
of November 3, 2011, it being the first hearing in years 
dedicated explicitly to providing oversight of the Federal 
Election Commission.\40\ There was reason to hope that the 
subject of campaign finance and the implications of the system 
created since Citizens United would be discussed. Perhaps the 
subcommittee would focus on the greater than 400% increase in 
the rate of deadlocked votes preventing FEC from enforcing 
campaign finance law?\41\ As the subcommittee's Ranking Member, 
Mr. Gonzalez raised all of these concerns in his opening 
statement and questions.\42\ The Chairman's focus, and that of 
every Member of the Majority, however, was on getting FEC to 
release documents, some obsolete,\43\ describing how it 
enforces campaign finance laws.\44\ The document release that 
followed, after much expenditure of time and energy, may ``have 
made it a little easier for campaign operatives to decide 
whether violating campaign finance laws is worth the fines they 
might have to pay'',\45\ but they did nothing to examine the 
changes in campaign financing, let alone to attempt to explore 
or address the problem.
---------------------------------------------------------------------------
    \40\Committee on House Administration, ``Federal Election 
Commission: Reviewing Policies, Processes and Procedures'', November 
03, 2011 (http://cha.house.gov/hearing/subcommittee-elections-hearing-
federal-election-commission-reviewing-policies-processes-and).
    \41\Public Citizen, ``Roiled in Partisan Deadlock, Federal Election 
Commission Is Failing'', October 13, 2011 (http://www.citizen.org/
documents /fec-deadlock-statement.pdf); Wang, Marian, ``As Political 
Groups Push Envelope, FEC Gridlock Gives `De Facto Green Light''', 
ProPublica, November 07, 2011 (http://www.propublica.org/ article/as-
political-donors-push-envelope-fec-gridlock-gives-de-facto-green-light/
single); Jesse Zwick, ``Broken Federal Election Commission Fails to 
Enforce Campaign-Finance Laws'', The Washington Independent, September 
28, 2010 (http://washingtonindependent.com/98816/broken-federal- 
election-commission-fails-to-enforce-campaign-finance-laws).
    \42\Federal Election Commission: Reviewing Policies, Processes And 
Procedures Hearing before the Subcomm. on Elections of the H. Comm. on 
House Administration, 112th Cong. 3-4 (statement of Rep. Charles A. 
Gonzalez) , 54-55 (questions from Rep. Gonzalez) (2011) (http://
www.gpo.gov/fdsys/pkg /CHRG-112hhrg72282/pdf/CHRG-112hhrg72282.pdf).
    \43\Id. at 50 (answer of Ellen Weintraub, FEC Commissioner) (``The 
document that I think of as the enforcement manual is a large, 
cumbersome, rather out of date collection of memoranda that are not--a 
number of them have been superseded.'').
    \44\Committee on House Administration, ``Harper Calls on FEC to 
Disclose Enforcement Standards'', November 03, 2011 (http://
cha.house.gov/press-release/harper-calls-fec-disclose-enforcement-
standards).
    \45\Committee on House Administration, Democratic Office, 
``Gonzalez Calls for Increased Action on Campaign Finance and Electoral 
Protection from FEC and House Republicans'', May 23, 2012 (http://
democrats.cha.house.gov/ press-release/gonzalez-calls-increased-action-
campaign-finance-and-electoral-protection-fec-and).
---------------------------------------------------------------------------
    On February 15, 2012, more than two years after Citizens 
United and more than a year after the 112th Congress convened, 
the Committee's three Democrats wrote a letter to Chairman 
Lungren, urging him ``to convene the Committee on House 
Administration to conduct oversight hearings on the increasing 
role and influence of undisclosed money in our electoral 
system.''\46\ The Chairman did not respond. Nor did the 
Committee take any action in this area beyond continuing to 
press FEC for those enforcement guidelines.
---------------------------------------------------------------------------
    \46\Committee on House Administration, Democratic Office, ``House 
Administration Democrats Urge Oversight on the Role of Money in 
Elections and the DISCLOSE 2012 Act'', February 15, 2012 (http://
democrats.cha.house.gov/press-release/house-administration-democrats-
urge-
oversight-role-money-elections-and-disclose-2012).
---------------------------------------------------------------------------

                           THE MINORITY ACTS

    These issues are so important, so vital to the working of 
our democracy, that the public must be made aware of them. They 
demanded the scrutiny of a congressional hearing and, with the 
Majority blocking one of those, a Minority-called forum was the 
next step. We had to get the word out and this was the only 
route we had left. In his capacity as Ranking Member of the 
Subcommittee on Elections, Mr. Gonzalez asked Chairman Lungren 
for use of the Committee's hearing room as a venue in which he 
could conduct a forum of his own on the subject and the 
chairman graciously agreed. On April 18, 2012, Mr. Gonzalez 
gaveled to order, ``The Most Expensive Seat in the House: The 
State of Our Campaign Finance System''. Mr. Gonzalez sat in the 
chair and was joined by Democratic Leader Nancy Pelosi (CA-8), 
Committee Ranking Member Robert A. Brady (PA-1), Michael 
Capuano (MA-8), Keith Ellison (MN-5), David Price (NC-4), and 
Chris Van Hollen (MD-8), author of the DISCLOSE Acts of 2010 
and 2012.\47\
---------------------------------------------------------------------------
    \47\Further information about the forum is available at http://
democrats.cha.house.gov/event/congressional-forum-campaign-finance and 
the full video is available at http://www. youtube.com/
watch?v=tTt5VbHUxNA.
---------------------------------------------------------------------------
    It had been hoped that the first panel would consist of 
Super PACs donors. Mr. Gonzalez invited the eight largest 
donors to the largest Super PACs to testify.\48\ At the time 
the invitations went out, these largest donors were:
---------------------------------------------------------------------------
    \48\These letters may be found in Appendix C.
---------------------------------------------------------------------------
          1. Sheldon & Miriam Adelson, whose family's $18.9 
        million in contributions constituted 80% of the 
        receipts of ``Winning Our Future'';
          2. Harold Simmons, whose $10 million in individual 
        and corporate contributions to ``American Crossroads'' 
        was 28% of their reported receipts;
          3. Bevin Albertani, Political Director of Laborers' 
        Political League--Education Fund, which gave $350,000 
        to ``House Majority PAC'', 12% of its total receipts;
          4. Virginia James, who gave $1 million to ``Club for 
        Growth Action'', 19% of their total;
          5. Jeffrey Katzenberg, who contributed $2 million, 
        fully 32% of the receipts of ``Priorities USA Action'';
          6. Bob Perry, whose $4 million in contributions was 
        9% of the total reported by ``Restore Our Future, 
        Inc.'';
          7. Foster Friess, whose $1.6 million contribution was 
        28% of the total received by ``Red White and Blue 
        Fund'';
          8. Peter Thiel, whose $2.6 million dollars was 71% of 
        the total contributions received by ``Endorse Liberty, 
        Inc.''
These donors were invited to testify, in writing or in person, 
about how they felt about our campaign finance system, 
including why they were contributing. It would have been 
particularly interesting to hear Mr. Adelson describe the 
sentiments of a conflicted donor. As Mr. Gonzalez noted in his 
opening remarks, Mr. Adelson had recently told a reporter, 
``I'm against very wealthy people attempting to [influence] or 
influencing elections. But as long as it is doable, I am going 
to do it.''\49\ It is to be regretted that Mr. Adelson declined 
to speak further to the American people and to Congress on such 
an important topic. The forum was fortunate, however, to have a 
most distinguished panel of experts who were eager to discuss 
this subject with the Members.
---------------------------------------------------------------------------
    \49\Steve Bertoni, ``Billionaire Sheldon Adelson Says He Might Give 
$100M To Newt Gingrich Or Other Republican'', Forbes.com, February 21, 
2012 (http://www.forbes.com/sites/stevenbertoni/2012/02/21/billionaire-
sheldon-adelson-says-he-might-give-100m-to-newt-gingrich
-or-other-republican/).
---------------------------------------------------------------------------
    The first witness recognized was Dr. Norman Ornstein, a 
longtime observer of Congress and politics who hold a Ph.D. in 
political science from the University of Michigan. Next to 
testify was Monica Youn, J.D., the inaugural Brennan Center 
Constitutional Fellow at NYU School of Law. Zephyr Teachout, 
J.D., associate professor of law at Fordham University School 
of Law, followed Ms. Youn. The final witness was Paul S. Ryan, 
J.D., senior counsel at the Campaign Legal Center. The 
witnesses' testimony and the questions from the Members covered 
a great deal of ground, from the Founders' great concerns about 
corruption to the misunderstandings upon which the Supreme 
Court had decided Citizens United to the impact the decision 
had already had, not only on campaign finance but on the nature 
of American politics and the public perception of our 
government.

                  THE $44 MILLION ELEPHANT IN THE ROOM

    In the months since the forum, the problems with our 
campaign finance system have only become more obvious to those 
paying attention. For several reasons, most coverage of the 
rise of Super PACs and of campaign finance in general has 
focused on presidential campaigns. First, the race for the 
presidency is the premier race in the country. Second, it 
begins earlier, at least in the most public forms of 
advertising, than congressional races. Third, the amounts of 
money are vastly larger.\50\ Ironically, the same reasons make 
Super PAC spending less influential in presidential races than 
it is in congressional races. Because there is more information 
and so much money, it is harder for a Super PAC to mislead 
voters or to completely overwhelm a given candidate. This is 
not to suggest it is impossible. ``The super PAC money kept 
Gingrich afloat for longer than he would have [been] without 
it--and when it dried up, his campaign faded''.\51\ It was 
Super PAC spending that defeated Romney in South Carolina\52\, 
Gingrich in Florida\53\, and Santorum in Ohio\54\ and 
Illinois.\55\ The Romney campaign did not even air ads in 
Louisiana, while his Super PAC spent $667,990.\56\ It would be 
a grave mistake, however, to ignore the much greater role Super 
PACs can play at the congressional level, and one of the goals 
was to shine some light on this influence.
---------------------------------------------------------------------------
    \50\Mike Allen & Jim VandeHei, ``GOP groups plan record $1 billion 
blitz'', Politico, May 30, 2012 (http://www.politico.com/news/stories/
0512/76849.html).
    \51\Jim Garofoli, ``Gingrich's failed run shows super PACs' 
power'', The San Francisco Chronicle, May 02, 2012 (http://
www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2012/05/02/MN801OCM7C.DTL).
    \52\National Journal Staff, ``Gingrich Wins South Carolina 
Primary'', National Journal, March 05, 2012 (http://
www.nationaljournal.com/2012-presidential-campaign/gingrich-wins-south-
carolina-primary-20120121).
    \53\The $15.3 million of the pro-Romney ``Restore Our Future'' was 
450% more than the $3.4 million spent by the pro-Gingrich ``Winning Our 
Future''. Alexander Burns, ``Gingrich forces outspent by nearly $12 
million on Florida airwaves'', Politico, January 29, 2012 (http://
www.politico.com/blogs/burns-haberman/2012/01/ gingrich-forces-
outspent-by-nearly-million-on-florida-112749.html).
    \54\Arden Farhi, ``Santorum cries foul over Romney's Ohio 
spending'', CBS News.com, March, 06, 2012 (http://www.cbsnews.com/8301-
503544_162-57391887-503544/santorum-cries-foul-over-romneys-ohio-
spending/).
    \55\David Espo & Steve Peoples, ``Romney routs Santorum'', Deseret 
News, March 20, 2012 (http://www.deseretnews.com/article/765561518/
Romney-routs-Santorum-in-GOP-primary-in-Illinois.html).
    \56\Kristin Jensen & Lisa Lerer, ``Santorum Wins In Louisiana As 
Romney Struggles In South'', March 25, 2012 (http://www.bloomberg.com/
news/2012-03-25/santorum-wins-republican-
primary-in-louisiana-ap-projects-1-.html).
---------------------------------------------------------------------------
    At the forum, Mr. Price told of how, two weeks before one 
election, one Super PAC, ``dumped $680,000 into that race in 
the form of a media buy'',\57\ pushing an ``endangered'' 
candidate to victory, while ``[h]undreds of thousands of 
dollars parachuted into [another] race in the last 2 weeks'' 
helped to defeat a second candidate.\58\ One of the major 
players in such congressional races in 2010 was a group called 
the Center to Protect Patients' Rights, which ``gave more than 
$44 million in 2010 to other tax-exempt groups, many of which 
spent millions on TV ads attacking Democrats running for the 
House and Senate''.\59\ Despite its ``name giv[ing] the 
misleading impression that it is solely concerned about health 
care'', CPPR has not limited its influence to one issue. For 
example, one of its few fully disclosed donations, of 
$100,000,\60\ went to a group focused on influencing 
redistricting in Florida.\61\ The full extent of causes 
receiving support from CPPR can only be guessed at. Certainly, 
there are congressional candidates who must recognize that, if 
they take certain positions, they may face a sudden, $600,000 
media buy, but they'd never know from whence the money came.
---------------------------------------------------------------------------
    \57\This American Life: ``Take The Money and Run For Office'', 
Chicago Public Media (March 30, 2012) (http://www.thisamericanlife.org/
radio-archives/episode/461/transcript). See Appendix A.
    \58\See Transcript 45:889-46:896 (http://www.youtube.com/
watch?v=tTt5VbHUxNA#t=2902).
    \59\Viveca Novak & Robert Maguire, ``Mystery Health Care Group 
Funneled Millions to Conservative Nonprofits'', Center for Responsive 
Politics, May 18, 2012 (http://www.opensecrets.org/news/2012/05/
cppr.html); Appendix A. Except where otherwise noted, all facts in this 
and the next paragraph may be found within the same article.
    \60\National Institute on Money in State Politics, ``Report on 2010 
activities of `Protect Your Vote''', retrieved June 24, 2012 (http://
www.followthemoney.org/database/StateGlance/committee.phtml?c=4538).
    \61\Abel Harding, ``Effort fighting Florida redistricting stokes 
ACORN fears'', The Florida Times-Union, September 22, 2010 (http://
jacksonville.com/opinion/blog/403455/abel-harding/2010-09-22/effort-
fighting-florida-redistricting-stokes-acorn-fears).
---------------------------------------------------------------------------
    Much like the mysterious corporations that sprung up solely 
to contribute to the pro-Romney Super PAC and then 
disappear,\62\ CPPR appears to exist solely to move undisclosed 
money from donors to recipients. Because CPPR and many of its 
recipients are 501(c)(4) organizations, it is not required to 
disclose its donors and most of them do not need to disclose 
that they had received money from it. In this way, donors to 
CPPR are able to wield great influence on our political 
campaigns with no way for the public to learn about who is 
behind these efforts. Indeed, we cannot know whether CPPR's $44 
million came from one person, one company, or one million 
different donors. This mysterious font of funding has had a 
major impact not only on American elections but on the lives of 
every one of our citizens affected by the legislators CPPR 
helped to defeat or to elect, but we do not know whom to praise 
or blame.
---------------------------------------------------------------------------
    \62\See note 34, supra.
---------------------------------------------------------------------------
    Now, casino mogul Sheldon Adelson, who has a net-worth of 
more than $24 billion, has pledged ``limitless'' donations, 
exceeding $100 million, to Restore Our Future, Inc., the Super 
PAC supporting Mitt Romney's presidential campaign.\63\ (While 
it is implicit that Restore Our Future is focused on Mr. 
Romney, its public claim is that it is explicitly focused on 
supporting congressional candidates and only those ``in the 
know'' would be aware of its connection to Romney.\64\ That 
puts congressional candidates in a position of either fearing 
or competing for its many millions.) Interestingly, this comes 
after Adelson's family donated more than $20 million to Winning 
Our Future, a different Super PAC with the mission of defeating 
Mr. Romney's campaign, and which funded ads calling Romney 
``more ruthless than Wall Street''.\65\ As Ms. Youn mentioned 
at the forum, those donations to defeat Mr. Romney were made 
openly, and were disclosed to FEC.\66\ The recent donation to 
Restore Our Future became public only when an anonymous source 
leaked the information to the magazine Forbes, and Adelson has 
said that he plans to make his future donations to ``non-
profits affiliated with political PACS, which don't have to 
disclose the names of donors'' such as the Karl Rove-run 
Crossroads GPS.\67\ Of course, the co-founder of Crossroads GPS 
and its affiliated Super PAC American Crossroads is former 
Republican National Committee Communications Director Ed 
Gillespie, who left those groups to become ``Mitt Romney's 
senior adviser''.\68\ Rove himself recently attended the 
``First National Romney Victory Leadership Retreat'', along 
with the head of Restore Our Future.\69\ These actions show how 
thin a veneer the ``independence'' of ``independent 
expenditures'' truly is.
---------------------------------------------------------------------------
    \63\Steve Bertoni, ``Exclusive: Adelson's Pro-Romney Donations Will 
Be `Limitless,' Could Top $100M'', Forbes.com, June 13, 2012 (http://
www.forbes.com/sites/stevenbertoni/2012/06/13/exclusive-adelsons-pro-
romney-donations-will-be-limitless-could-top-100m/).
    \64\Restore Our Future's home page declares, ``we restore our 
future by supporting candidates'' (emphasis added). http://
restoreourfuture.com/ (retrieved June 25, 2012). Only by searching 
other portions of the website or gaining extrinsic knowledge would a 
citizen know of Mr. Romney's strong ties to the group. Interestingly, 
one campaign donation Restore Our Future has disclosed was of $25,000 
to the Independent Expenditure-Only Committee ``CITY ATTORNEY JAN 
GOLDSMITH 2012 COMMITTEE'' on March 30, 2012 (http://query.nictusa.com/
cgi-bin/com_rcvd/C00490045/), one day before Restore Our Future 
received a contribution of $25,000 from ``CITY ATTORNEY JAN GOLDSMITH 
2012 C''. (http://query.nictusa.com/cgi-bin/com_ind/C00490045/).
    \65\Christopher Palmeri & Beth Jinks, ``Adelson's $10 Million PAC 
Bet Gives Gingrich Boost For Southern Primaries'', Bloomberg, January 
25, 2012 (http://www.bloomberg.com/news/2012-01-25/adelson-s-10-
million-pac-bet-gives-gingrich-boost-for-southern-primaries.html); 
Alicia Mundy & Sarah Murray, ``Adelson Gives $10 Million to Pro-Romney 
Super PAC'', Washington Wire, June 13, 2012 (http://blogs.wsj.com/
washwire/2012/06/13/adelson-gives-10-million-to-pro-romney-super-pac/).
    \66\See Transcript 76:1559ff (http://www.youtube.com/
watch?v=tTt5VbHUxNA#t=5185).
    \67\See Mundy & Murray at note 65, supra.
    \68\FactCheck.org, ``A New Front in the `War on Women''', May 01, 
2012 (http://www.factcheck.org/2012/05/a-new-front-in-the-war-on-women/
).
    \69\Josh Israel, ``Rove `Makes A Mockery' Of Law: Super PAC Co-
Founder To Attend Romney Strategy Session This Weekend'', 
ThinkProgress, June 21, 2012 (http://thinkprogress.org/justice/2012/06/
21/503791/rove-makes-a-mockery-of-law-super-pac-co-founder-to-attend-
romney-strategy-session-this-weekend/mobile=nc). ``Karl Rove, of 
course, runs a superPAC. And there have been reports that the head of 
the pro-Romney superPAC, Restore Our Future, was also on hand. Is there 
a conflict of interest in that at all?'' Guy Raz, ``Romney Backers Wrap 
Up Utah Retreat'', Weekends on All Things Considered, June 24, 2012 
(http://www.npr.org/2012/06/24/155673445/romney-backers-wrap-up-utah-
retreat).
---------------------------------------------------------------------------

                          CORPORATE INFLUENCE

    Although Mr. Adelson's and his family members made their 
contributions as individuals, the greatest concern unleashed by 
Citizens United is the idea of corporations becoming able to 
make unlimited spending on campaigns for the first time since 
the Gilded Age. More than a century ago, Theodore Roosevelt 
declared, in Osawatomie, Kansas, ``every special interest is 
entitled to justice, but not one is entitled to a vote in 
Congress, to a voice on the bench, or to representation in any 
public office. The Constitution . . . does not give the right 
of suffrage to any corporation. . . . The citizens of the 
United States must effectively control the mighty commercial 
forces which they have themselves called into being.''\70\ This 
seems a simple concept.
---------------------------------------------------------------------------
    \70\Theodore Roosevelt, ``The New Nationalism'', August 31, 1910 
(http://www.pbs.org/wgbh/americanexperience/features/primary-resources/
tr-nationalism/).
---------------------------------------------------------------------------
    Unlike people, corporations are creations of the state. 
They can be called into existence at any time and, as happened 
with several donors to Restore Our Future, wink out of 
existence just as quickly.\71\ As Mr. Ryan explained at the 
forum:
---------------------------------------------------------------------------
    \71\Democracy 21 and Campaign Legal Center Call for FEC and Justice 
Department Investigations of Additional $1 Million Contributions to 
Pro-Romney Super PAC, Thursday, August 11, 2011; http://
www.democracy21.org/index.asp?Type=B_PR&SEC=%7B91FCB139-CC82-4DDD-AE4E-
3A81E6427C7F%7D&DE=%7B79EE1D8A-56BC-4168-A3DE-8CF4E07503F8%7D.

        These (c)(4)s that are going to be spending tens or 
        hundreds of millions of dollars in this year's 
        elections on attack ads--and they will be doing the 
        dirty work of candidates, they will be doing the attack 
        ads--they can dissolve overnight. They can dissolve at 
        the drop of a hat.
          And those of us sitting in this room today, God 
        willing, we will be here in December. We will be alive. 
        We will be held accountable for the actions we take 
        between now and then. That can't be said for these 
        501(c)(4) and other types of outside groups that, 
        again, can dissolve with the filing of some paperwork 
        with a secretary of state's office at the drop of a 
        hat. That is a big problem.\72\
---------------------------------------------------------------------------
    \72\See Transcript 50-988-99 (http://www.youtube.com/
watch?v=tTt5VbHUxNA#t=3271).

Less than six months into 2012, corporations have donated tens 
of millions of dollars to Super PACs, and that is counting only 
the money about which we know.\73\ There is simply and 
literally no way to know how much undisclosed and unlimited 
corporate money has been pledged, donated, or already spent 
influencing this year's elections.
---------------------------------------------------------------------------
    \73\See Appendix B.
---------------------------------------------------------------------------
    Some commentators have focused on the absence of Fortune 
500 companies on FEC disclosure forms, confidently stated that 
big corporations have not begun to contribute as many 
feared.\74\ It may be that they have not for, as Prof. Teachout 
pointed out, ``The culture of corporations has not yet adopted 
the Citizens United law. They have not yet hired the best 
campaigners. They have not yet figured out all the loopholes. 
This is 2 years in.''\75\ So, the fact that we have not seen a 
Fortune 500 company on a Super PAC's FEC disclosure forms 
doesn't indicate that we shouldn't expect to see one or many or 
even all of them very soon indeed.
---------------------------------------------------------------------------
    \74\Stuart Rothenberg, ``How Citizens United Is Affecting 
Campaigns'', Roll Call, May 22, 2012 (http://www.rollcall.com/issues/
57_139/How-Citizens-United-Is-Affecting-Campaigns-214705-1.html).
    \75\See Transcript 31:607-10 (http://www.youtube.com/
watch?v=tTt5VbHUxNA#t=2012).
---------------------------------------------------------------------------
    Of course, the fact that we don't actually know who is 
providing the money is also part of the point.\76\ We know that 
undisclosed spending jumped from effectively 0% in 2006 to 47% 
in 2010, while spending from donors who are fully disclosed 
plummeted from roughly 90% to below 50%.\77\ There is only one 
way to know that one of the multiple $10 million donations to 
Crossroads GPS--to say nothing of undisclosed donations about 
which we know nothing--didn't come from Exxon-Mobil or 
JPMorganChase, Inc., and that's for the donor or recipient to 
tell us.\78\ In fact, we cannot even be sure that those 
companies know that they didn't make the donations. At the 
forum, Ms. Youn told the story of ``a multinational 
pharmaceutical corporation that . . . found out that one of its 
mid-level managers was spending corporate funds to support an 
openly racist candidate in Mississippi, and he was doing that 
without the knowledge of upper management.``\79\ Had there been 
disclosure requirements, this company would have found out 
immediately. For that matter, we cannot know that the money 
wasn't donated by a foreign corporation or even a foreign 
government, in violation of United States law.\80\
---------------------------------------------------------------------------
    \76\``We don't know who these donors are. We don't even know 
whether these donors are individuals or whether they are 
corporations.'' Monica Youn, see Transcript 23:452-24:454 (http://
www.youtube.com/watch?v=tTt5VbHUxNA#t=1477).
    \77\Spencer MacColl, ``Citizens United Decision Profoundly Affects 
Political Landscape'', Center for Responsive Politics, May 05, 2011 
(http://www.opensecrets.org/news/2011/05/citizens-united-decision-
profoundly-affects-political-landscape.html). See Appendix B.
    \78\T.W. Farnam, ``Mystery donor gives $10 million to Crossroads 
GPS group to run anti-Obama ads'', The Washington Post, April 13, 2012 
(http://www.washingtonpost.com/politics/mystery-donor-gives-10-million-
to-crossroads-gps-group-to-run-anti-obama-ads/2012/04/13/gIQ 
AzdtdFT_story.html).
    \79\See Transcript 72:1476-14821 (http://www.youtube.com/
watch?v=tTt5VbHUxNA#t=4900).
    \80\2 U.S.C. 441(e). Stephen Braun, ``Super PAC Foreign Donations A 
Risk In 2012 Presidential Election'', The Huffington Post, February 10, 
2012 (http://www.huffingtonpost.com/2012/02/10/super-pac-
donations_n_1267750.html). Professor Teachout also has described the 
rise of ``extraterritorial electioneering'', ways in which foreign 
individuals and even governments have already worked directly to 
influence the outcome of American elections. Teachout, Zephyr, 
``Extraterritorial Electioneering and The Globalization of American 
Elections'', 162 Berkeley Journal of International Law [Vol. 27:1], 
February 08, 2009, pp. 161-190 (http://www.boalt.org/bjil/docs/
BJIL27.1_Teachout.pdf).
---------------------------------------------------------------------------
    Whether the donor knows or not, we can be fairly confident 
that they won't tell us. In the recent case out of Montana, a 
Super PAC promoted itself by writing to potential donors, 
``[W]e're not required to report the name or the amount of any 
contribution that we receive. So, if you decide to support this 
program, no politician, no bureaucrat, and no radical 
environmentalist will ever know you helped make this program 
possible.''\81\ With even Mr. Adelson embracing anonymous 
giving,\82\ despite the protections his vast wealth provides, 
secrecy will be the norm unless Congress changes the law. We 
can, however, be sure that the recipients of this largesse will 
know who contributed, as well as who didn't.\83\ How could this 
not cause ``corruption or the appearance of corruption''?\84\ 
In fact, we know that it has. A recent study by the Brennan 
Center reported that,``69% of respondents agreed that new rules 
that let corporations, unions and people give unlimited money 
to Super PACs will lead to corruption.'''\85\
---------------------------------------------------------------------------
    \81\Western Tradition Partnership, Inc. v. Attorney General, 271 
P.3d 1, 13 (MT, 2011), 2011 MT 328, para.19 (http://
applicationengine.mt.gov/getContent?vsId=(1C0B7886-01C0-49E3-A71A-
C06CA7E71040)&impersonate=true&objectStoreName=PROD%20OBJECT%20STORE&obj
ect Type=document).
    \82\See note 67, supra.
    \83\``[T]he problem is not just that the source of the money is 
publicly secret, it is that it is privately very much not secret--word 
will get back to the powers that be, on Capitol Hill and, presumably, a 
Romney White House, about who gave and who did not give. . . . Those 
who are hit up for money know this, and have to worry about whether 
they will be at a disadvantage in future intra-industry fights, if 
their competitor gives and they don't. If it starts to look like a 
shakedown, that's because it is.'' Alec MacGillis, ``Full Disclosure: 
Praise For Fred Hiatt'', The New Republic, June 19, 2012 (http://
www.tnr.com/blog/plank/104133/full-disclosure-praise-fred-hiatt).
    \84\Citizens United, 130 S.Ct. at passim, and Buckley v. Valeo, 424 
U.S. 1, 26 (1976). Cf. American Tradition Partnership, Inc. v. Bullock, 
567 U.S._(2012) (Breyer, J., dissenting) (``Montana's experience, like 
considerable experience elsewhere since the Court's decision in 
Citizens United, casts grave doubt on the Court's supposition that 
independent expenditures do not corrupt or appear to do so.'') (http://
www.supremecourt.gov/opinions/11pdf/11-1179h9j3.pdf).
    \85\Brennan Center for Justice, ``National Survey: Super PACs, 
Corruption, and Democracy'', April 24, 2012 (http://
www.brennancenter.org/content/resource/national_survey_super_
pacs_corruption_and_democracy/). See Appendix C.
---------------------------------------------------------------------------

         THE 501(C)(4) BLACK HOLE OF LEGALLY UNDISCLOSED GIVING

    The situation has become so bad that prominent Republicans, 
non-federal officials whose campaigns have always been funded 
by large, corporate donations, are aghast. Texas Governor Rick 
Perry has been ``decrying `Washington special interests' trying 
to buy a Texas Senate seat.''\86\ Those ``Washington special 
interests'' are the Super PACs ``Club for Growth Action'' and 
``FreedomWorks for America''.\87\ The former has disclosed 791 
donations from 597 donors in this cycle, but 73% of its money 
has come from just 16 donors, each having given more than 
$100,000.\88\
---------------------------------------------------------------------------
    \86\Priya Anand & Richard S. Dunham, ``Senate candidate Cruz 
pockets big bucks across U.S.'', San Antonio Express-News, June 12, 
2012 (http://www.mysanantonio.com/news/local--news/article/Senate-
candidate-Cruz-pockets-big- bucks-across-3629079.php).
    \87\Jonathan Gurwitz, ``Washington groups misfire in Senate race'', 
San Antonio Express-News, June 09, 2012 (http://www.mysanantonio.com/
opinion/columnists/jonathan_gurwitz/article/Washington-groups-misfire-
in-Senate-race-3620108.php).
    \88\Analysis of FEC data, see Appendix B.
---------------------------------------------------------------------------
    As of June 18, 2012, of the $3.3 million the Super PAC 
``FreedomWorks for America'' reported receiving in this 
election cycle, 52% was donated in 204 separate donations by 
its sister organization, the 501(c)(4) FreedomWorks.\89\ The 
way this works is that contributions to the 501(c)(4) are not 
disclosed, since it is registered with the Internal Revenue 
Service as a ``tax-exempt . . . social welfare organization'', 
barred from ``direct or indirect participation or intervention 
in political campaigns''.\90\ So a donor can contribute to 
FreedomWorks without disclosure, FreedomWorks then contributes 
to ``FreedomWorks for America'', and the only name disclosed is 
``FreedomWorks.'' Similarly, the 17th largest donor to ``Club 
for Growth Action'' is the Club for Growth 501(c)(4).\91\ As 
satirist Stephen Colbert, who has taken to calling 501(c)(4)s 
``Spooky PACs'',\92\ asked, in a segment of his show played at 
the forum, ``What is the difference between that and money 
laundering?'' We join former FEC Chairman Trevor Potter in 
responding, ``It's hard to say.''\93\
---------------------------------------------------------------------------
    \89\Id.
    \90\Internal Revenue Service, ``Social Welfare Organizations'', 
Page Last Reviewed or Updated: April 04, 2012 (http://www.irs.gov/
charities/nonprofits/article/0,,id=96178,00.html).
    \91\Analysis of FEC data, see Appendix B.
    \92\``Colbert Super PAC SHH!--Corporate Campaign Players & Super 
Secret `Spooky PACs''', The Colbert Report, May 08, 2012 (http://
www.colbertnation.com/the-colbert-report-videos/413970/may-08-2012/
corporate-campaign-players_super-secret_spooky-pacs-).
    \93\``Colbert Super PAC_Trevor Potter & Stephen's Shell 
Corporation'', The Colbert Report, September 29, 2011 (http://
www.colbertnation.com/ the-colbert-report-videos/398531/september-29-
2011/ colbert-super-pac_ trevor-potter_ stephen-s-shell_ corporation).
---------------------------------------------------------------------------
    But a 501(c)(4) doesn't even need a sister Super PAC to 
engage in this negative advertising. In implementing the ban on 
social welfare organizations engaging in politics, IRS has 
ruled that ``a section 501(c)(4) social welfare organization 
may engage in some political activities, so long as that is not 
its primary activity.''\94\ As Mr. Ryan explained at the forum, 
this means that a 501(c)(4)
---------------------------------------------------------------------------
    \94\See note 88, supra.

        can spend . . . 49 cents out of every dollar you have 
        given it on hard-hitting, express advocacy ads urging 
        the election of [a specific candidate] and [then] spend 
        the other 51 cents on ads that are nearly as hard-
        hitting, sham issue ads that either attack an opponent 
        on the basis of some issue, but certainly identify the 
        candidates in the race, yet don't contain words of 
        express advocacy and, therefore, don't fall under the 
        rubric of ``candidate election intervention'' for tax 
        law purposes.\95\
---------------------------------------------------------------------------
    \95\See Transcript 75:1544-76:1552 (http://www.youtube.com/
watch?v=tTt5VbHUxNA#t= 5138). It should be noted that IRS has begun to 
look into the implications of its policy and whether such groups are 
abusing the policy to procure a tax-exempt status not intended to cover 
political committees. Jonathan D. Salant, ``IRS Denial Of Tax Exemption 
To U.S. Political Group Spurs Alarms'', Bloomberg, June 08, 2012 
(http://www.bloomberg.com/news/2012-06-08/irs-denial-of-tax-exemption-
to-u-s-political-group-spurs-alarms.html).
    Similarly, the Federal Communications Commission has taken steps to 
increase transparency for political advertising on broadcast stations 
by moving to require that stations post their ``political file 
information online.'' This would allow the public to learn who is 
actually paying for radio and television campaign advertisements. 
Federal Communications Commission, ``Standardized and Enhanced 
Disclosure Requirements for Television Broadcast Licensee'', Second 
Report and Order, April 27, 2012, at 17 (http://transition.fcc.gov/
Daily_Releases/Daily_Business/2012/db0508/FCC-12-44A1.pdf).
    On March 30, 2012, the District Court for the District of Columbia 
granted Mr. Van Hollen summary judgment in his suit to require FEC to 
demand ``that every person who funds electioneering communications must 
disclose all contributors.'' Federal Election Commission, ``Summary of 
Van Hollen v. FEC'', retrieved June 24, 2012 (http://www.fec.gov/law/
litigation/van_hollen.shtml).
    On June 12, 2012, the Fourth Circuit Court of Appeals affirmed the 
FEC's ruling that the producers of a video much like that at the heart 
of Citizens United were clearly producing ``electioneering 
communications'' and, therefore, subject to FEC's disclosure 
requirements. Campaign Legal Center, ``Donor Disclosure Provisions 
Again Upheld by Fourth Circuit in Real Truth About Obama'', June 12, 
2012 (http://www.campaignlegalcenter.org/index.php?option=com_ 
content&view= article&id=1759:june-12-2012-donor-disclosure-provisions-
again-upheld-by-fourth-circuit-in-real-truth-about-obama).
    Thus, the Executive Branch, independent federal agencies, and the 
federal judiciary have all taken steps aimed at increasing disclosure 
of campaign spending, while the House of Representatives, designed to 
be the most responsive part of the Federal government, has failed to 
act.

    These Super PACs and 501(c)(4)s provide examples of some of 
the holes in our disclosure law never contemplated in the 
Citizens United decision. Indeed, the Court in Citizens United 
called for and explicitly relied upon disclosure to be our 
chief protection from the impact of its decision.\96\ 
``[D]isclosure permits citizens and shareholders to react to 
the speech of corporate entities in a proper way. This 
transparency enables the electorate to make informed decisions 
and give proper weight to different speakers and 
messages.''\97\ This was also, once, the view of most Members 
of Congress.\98\ As a result of this clear mandate for 
disclosure, ``The courts, especially since Citizens United blew 
away campaign finance limits, seem much more apt to uphold 
broad disclosure rules.''\99\ Unless and until Republicans, in 
Congress and among FEC commissioners,\100\ stop blocking the 
enactment and enforcement of new disclosure laws and rules, 
however, we are faced with a situation never contemplated by 
the eight justices of the Supreme Court\101\: unlimited 
contributions without disclosure.
---------------------------------------------------------------------------
    \96\As Professor Teachout explained at the forum, bribery laws have 
been so interpreted as to be no protection against corruption when it 
comes to campaign finance. ``[I]n the context of bribery laws, we say, 
`Don't worry, campaign finance laws will cover it.' And then, in 
Citizens United and other cases, Kennedy says, `Don't worry, bribery 
laws will cover it.' And what you end up is this great cavity where 
what you and I and the rest of the country knows is corruption in the 
sense the Founders meant is allowed to go on.'' See Transcript 30:592-
31:598 (http://www.youtube.com/watch?v=tTt5VbHUxNA#t=1915).
    \97\Citizens United v. FEC, 130 S.Ct. at 916. See also, Bauerly at 
note 30, supra, and Thomas Jefferson as quoted at note 104, infra.
    \98\See, ``Remember When Washington Republicans Supported 
Disclosure and Transparency?'', Appendix C.
    \99\Rick Hasen, ``Breaking News: 4th Circuit Upholds FEC's `Major 
Purpose' Test for Political Committees, Subjecting Groups Like 
Crossroads GPS to Potential Liability for Not Registering as Super 
PACs'', Election Law Blog, June 12, 2012 (http://electionlawblog.org/
?p=35602).
    \100\Norman Ornstein, ``Mitch McConnell Vs. Himself on Disclosure 
Issues'', Roll Call, June 20, 2012 (http://www.rollcall.com/issues/
57_154/Mitch-McConnell-Vs-Himself-on-Disclosure-Issues-215491-1.html), 
Appendix A.
    \101\``The section of the opinion upholding the constitutionality 
of federal disclosure requirements had added force behind it. All the 
justices except Clarence Thomas signed on--providing a resounding 8-1 
endorsement.'' Trevor Potter, ``Was the Court Conned in Citizens 
United?'', Bloomberg, May 23, 2011 (http://www.bloomberg.com/news/2011-
05-23/was-the-court-conned-in-citizens-united-.html).
---------------------------------------------------------------------------
    This brings us back to the subject of just how involved 
large corporations have become in campaigns. As bad as the 
501(c)(4) black hole may be, the public would at least know 
which specific 501(c)(4) had spent the money, even if, 
``Americans for A Better America''\102\ isn't very revealing. 
Perhaps we would learn to be suspicious of anyone hiding behind 
anodyne names or anonymity. But, in this post-Citizens United 
world, companies don't even need to spend the money to 
influence how legislators vote. Ms. Youn told the story of a 
case from North Carolina in 2008.\103\ It was a matter of state 
law, and North Carolina already allowed the independent 
expenditures now made possible in federal campaigns. One Super 
PAC-equivalent, created by a group of North Carolina farmers:
---------------------------------------------------------------------------
    \102\See Transcript 48:935ff (http://www.youtube.com/
watch?v=tTt5VbHUxNA#t=3105).
    \103\Brennan Center for Justice, ``Duke v. Leake'', November 05, 
2008 (http://www.brennancenter.org/content/resource/jackson_v_leake/).

        supported a particular farm subsidy [so] they made up a 
        whole campaign of attack ads against particular 
        legislators they knew were the swing votes. They then 
        took these ads to the legislators and screened them 
        behind closed doors and said, ``These are the ads we 
        will run against you if you do not support our position 
        on this legislation.'' And some of these legislators 
        changed their votes.\104\
---------------------------------------------------------------------------
    \104\See Transcript 51:1012-21 (http://www.youtube.com/
watch?v=tTt5VbHUxNA#t=3328).

This group never had to run a single ad, but that does not mean 
disclosure laws could not prevent such abuses. If the group 
would have been forced to disclose the farmers behind any ads 
it did run, the effectiveness of the ads and, thus, of the 
threat, could have been substantially weakened. This is the 
full power of disclosure. By arming American citizens with the 
facts, we empower them to control events. In the words of 
Thomas Jefferson, ``well informed [citizens] can be trusted 
with their own government; that whenever things get so far 
wrong as to attract their notice, they may be relied on to set 
them to rights.''\105\ There are many layers to this 
fundamental truth. The first is that the public must know about 
the problems before it ``may be relied on to set them to 
right.'' We hope that this forum has helped to inform in this 
regard. The second is that the public should know who is 
financing the campaign ads that have so dominated during the 
elections since Citizens United. And the third is that the lack 
of such disclosure has, as discussed above,\106\ lead to ads 
full of misleading and outright false claims, creating a 
misinformed public. This is not what our Founder intended.
---------------------------------------------------------------------------
    \105\Thomas Jefferson, letter to Richard Price, January 8, 1789. 
The Papers of Thomas Jefferson, ed. Julian P. Boyd, vol. 14, p. 420 
(1958). See also Doe v. Reed, 130 S.Ct. 2811, 2837 (2011) (Scalia, J., 
concurring) (``There are laws against threats and intimidation; and 
harsh criticism, short of unlawful action, is a price our people have 
traditionally been willing to pay for self-governance. Requiring people 
to stand up in public for their political acts fosters civic courage, 
without which democracy is doomed.''). For an analysis of opposing 
views, see Richard L. Hasen, ``Citizens: Speech, no consequences'', 
Politico, May 31, 2012 (http://dyn.politico.com/
printstory.cfm?uuid=54DFD684-5DA5-4F88-A1D8-3FB4B227EB12).
    \106\See subsection ``Unaccountable and Untrue'' on page 2, supra.
---------------------------------------------------------------------------

                  THIS IS NOT WHAT OUR FOUNDERS WANTED

    We've heard a great deal in the past three years about the 
Tea Party. I'm sorry to say that the story behind the real Tea 
Party, the Boston Tea Party, is sadly misunderstood. The cry in 
1773 was a simple one: No taxation without representation.\107\ 
The modern Tea Party seems to have forgotten the second half, 
but it's the key to the whole thing. Those Massachusetts 
patriots weren't protesting taxation. They accepted taxation as 
a fair price to pay for membership in what was then the 
greatest country in the world. What drove them, on the night of 
December 16, 1773, to commit a felony by breaking into those 
tea ships and casting their cargo into Boston Harbor was the 
fact that they had no say in what those taxes would be and how 
they would be spent because they had no say in the setting of 
those taxes because they could not vote for their own 
representatives. That was the injustice. Not the taxation but 
the lack of representation.
---------------------------------------------------------------------------
    \107\This simple request, of course, is still denied our fellow 
American citizens who live in the nation's capital, and we hope to see 
the day that their right to full participation in our shared government 
is realized.
---------------------------------------------------------------------------
    It was the quest to have a representative government that 
led to our country's founding. That's why no right is more 
important or more protected by the Constitution than the right 
to vote. In the past 207 years, we have amended the 
Constitution 15 times. Seven of those amendments, almost half 
of the amendments over more than two centuries, are about 
protecting, in the words of the 14th Amendment, ``the right to 
vote''. Our elections are a vital part of what makes this 
country great. Oversight of elections is the greatest 
responsibility under the jurisdiction of the Committee on House 
Administration. If something is happening which is proven to 
distort the opportunity of our populace to vote as it wishes, 
something must be done. We have factual information that the 
result of Citizens United is a misinformed populace. This 
misinformation is interfering with free and public elections. 
As Members of this Committee, we have not just the opportunity 
but the responsibility to bring this fact to the public's 
attention and to act to remedy it. The Committee has failed to 
meet that responsibility.
    Almost 130 years ago, the Supreme Court listed two great 
threats to our democracy: the violent suppression of the right 
to vote and the corrupting influence of money in politics. On 
March 03, 1884, Mr. Justice Miller wrote, for a unanimous 
Supreme Court, that the ``right to vote for a member of 
congress [is] fundamentally based upon the constitution [and 
i]t is as essential to the successful working of this 
government that the great organisms of its executive and 
legislative branches should be the free choice of the 
people''\108\ He closed his opinion with this peroration:
---------------------------------------------------------------------------
    \108\Ex parte Yarbrough ``The Ku Klux Cases'', 110 US 651, 665-66.

          If the recurrence of such acts as these prisoners 
        stand convicted of [i.e., beating potential Black 
        voters to intimidate them] are too common in one 
        quarter of the country, and give omen of danger from 
        lawless violence, the free use of money in elections, 
        arising from the vast growth of recent wealth in other 
        quarters, presents equal cause for anxiety.
          If the government of the United States has within its 
        constitutional domain no authority to provide against 
        these evils--if the very sources of power may be 
        poisoned by corruption or controlled by violence and 
        outrage, without legal restraint--then indeed is the 
        country in danger, and its best powers, its highest 
        purposes, the hopes which it inspires, and the love 
        which enshrines it are at the mercy of the combinations 
        of those who respect no right but brute force on the 
        one hand, and unprincipled corruptionists on the 
        other.\109\
---------------------------------------------------------------------------
    \109\Id. at 667.

    From the Founders debating how to prevent corruption at the 
Constitutional Convention in the 18th Century,\110\ through the 
Supreme Court listing unrestricted use of ``money in 
elections'' as one of the great threats to our democracy in the 
19th Century,\111\ to the Congress passing the Tillman Act of 
1907\112\ and the Federal Elections Campaign Act of 1971\113\ 
in the 20th Century, and the Bipartisan Campaign Finance Reform 
Act of 2002\114\ in the 21st Century, campaign finance 
regulation has always been one of the top priorities of 
government. In that Osawatomie speech, Theodore Roosevelt would 
go on to say, ``There can be no effective control of 
corporations while their political activity remains. To put an 
end to it will be neither a short nor an easy task, but it can 
be done.''\115\ The Members of Congress and witnesses who 
supported and participated in our forum have contributed to 
that long and hard work, but there is much more to be done. 
Indeed, the failure of Congress to enact new legislation in the 
immediate aftermath of Citizens United has only made the task 
harder. As Prof. Teachout put it during the forum, when it 
comes to corporate spending on elections, ``We are playing 
checkers now, and it is about to be chess. I mean, this hasn't 
begun yet.``\116\
---------------------------------------------------------------------------
    \110\Zephyr Teachout, ``The Anti-Corruption Principle'', Cornell 
Law Review [Vol. 94:341], pp. 341-414 (http://
www.lawschool.cornell.edu/research/cornell-law-review/upload/Teachout-
Final.pdf).
    \111\Ex parte Yarbrough ``The Ku Klux Cases''. (110 US 651).
    \112\Pub. L. No. 59-36, 34 Stat. 864 (codified as amended at 2 
U.S.C. 441b (2006)).
    \113\Pub. L. 92-225, 86 Stat. 3, enacted February 7, 1972, 2 U.S.C. 
431 et seq. (1971) See also the Federal Election Campaign Act 
Amendments of 1974, Pub. L. 93-443, 88 Stat. 1263 (codified as amended 
at 2 U.S.C. 431-455 (2006)).
    \114\Pub. L. No. 107-155, 116 Stat. 81 (codified in various 
sections of title 2 of the United States Code); see also, Federal 
Election Commission, ``Bipartisan Campaign Reform Act of 2002'', 
retrieved June 24, 2012 (http://www.fec.gov/pages/bcra/
bcra_update.shtml).
    \115\Roosevelt, ``The New Nationalism'', at note 70, supra.
    \116\See Transcript 52:1027-28 (http://www.youtube.com/
watch?v=tTt5VbHUxNA#t=3404).
---------------------------------------------------------------------------
    The 112th Congress has failed to meet its obligation in 
this regard but our country will survive and we will have 
another opportunity to do what was not done in this Congress. 
It is hoped that the record from this forum will serve as a 
foundation for the work that is to come. Because it must come. 
Our history and the American people demand it.

                       APPENDIX A: NEWS ARTICLES

              [From the Los Angeles Times, Apr. 17, 2012]

       Secret Donors Pour Millions of Dollars Into Crossroads GPS

                            (By Matea Gold)

    Washington.--Crossroads GPS, a conservative nonprofit group 
that is one of the most prominent critics of President Obama, 
raised nearly $77 million in its first 19 months from a small 
cadre of secret donors, including two dozen who wrote checks of 
$1 million and more.
    The organization, founded in part by GOP strategist Karl 
Rove, received two single donations worth $10 million each 
between June 1, 2010 and the end of 2011, according to newly 
filed tax documents the group released Tuesday. It is 
impossible to know who gave the money, as the group simply 
listed each individual contribution and left blank the areas on 
the form for the names and addresses of the donors.
    Crossroads GPS reported the identity of the donors to the 
IRS, as required, but does not have to reveal them publicly.
    As a 501(c)4 social welfare organization, Crossroads GPS 
cannot make political activity its primary purpose, unlike its 
sister ``super PAC,'' American Crossroads. Both are able to 
accept unlimited donations from both individuals and 
corporations.
    Together, the two groups have emerged as the most muscular 
new players in the political landscape, aiming to spend $300 
million this year to promote conservatives and defeat Obama.
    As a tax-exempt group, Crossroads GPS ostensibly faces more 
limits on its political activity, but it is free to run so-
called ``issue ads'' that stop short of calling for the 
election or the defeat of a candidate.
    Earlier this month, Crossroads GPS spent $1.7 million to 
run one such ad in six presidential swing states attacking 
Obama's energy policy.
    Campaign finance reform advocates argue that the 
organization is essentially a political player hiding behind 
its tax status. Democracy 21 and the Campaign Legal Center on 
Tuesday repeated their calls to the IRS to investigate 
Crossroads GPS's tax status, as well as that of several others, 
including the conservative group American Action Network and 
Priorities USA, a tax-exempt group affiliated with a pro-Obama 
super PAC.
    ``It is essential that the IRS act to stop the farce that 
Crossroads GPS is a `social welfare' organization,'' Fred 
Wertheimer, president of Democracy 21, said in a statement. 
``Karl Rove and Crossroads GPS are thumbing their nose at the 
American people. They are injecting secret, million dollar and 
multi-million dollar contributions into federal elections in 
direct conflict with the basic right of citizens to know the 
donors financing campaign expenditures to influence their 
votes.''
    Crossroads GPS spokesman Jonathan Collegio said the group 
carefully hews to its nonprofit role, saying it only spends ``a 
portion of its resources on political activity that furthers 
its social welfare mission.''
    He said its donors ``are individuals and businesses that 
support its vision of lower taxes and smaller government.''
    ``Environmental groups and labor groups have been airing 
ads promoting their causes and targeting politicians for years, 
but the brunt of Wertheimer's criticism focuses on conservative 
groups engaging in the same activity,'' Collegio said.
    In 2010 and 2011, Crossroads GPS spent at least $43 million 
on media, according to its tax documents. It also doled out 
nearly $16 million in grants to an array of conservative 
organizations, including $4 million to Grover Norquist's 
Americans for Tax Reform and $2.75 million for the Center for 
Individual Freedom, a group that was originally launched more 
than a decade ago by former tobacco industry executives who 
sought to counter government restrictions on smoking. After 
getting involved in an eclectic range of causes over the years, 
the center emerged as a player in the 2010 midterm elections, 
spending at least $2.5 million on negative ads against about 10 
Democratic members of Congress.
    The fund-raising success of Crossroads and its super PAC 
counterpart was reflected in the robust compensation paid to 
the groups' president, Steven Law, a former general counsel of 
the U.S. Chamber of Commerce and deputy secretary of the 
Department of Labor. Over the 19-month period, Law earned $1.09 
million in salary and bonuses from the two groups, the tax 
records show.
    The Tribune Washington Bureau/Los Angeles Times reported in 
February that many political operatives are reaping financial 
rewards as super PACs and their nonprofit kin have proliferated 
with little oversight.
                                ------                                


               [From Fresh Air from WHYY, Feb. 23, 2012]


          Examining the SuperPAC With Colbert's Trevor Potter

    Republican and Democratic SuperPACs, empowered by the 
Supreme Court's Citizens United decision, can collect unlimited 
contributions from individuals, corporations and unions. Potter 
became a celebrity when he signed on as Stephen Colbert's 
lawyer and advised the satirical TV host on how to create his 
own SuperPAC.
    TERRY GROSS, HOST: This is FRESH AIR. I'm Terry Gross. 
SuperPACs have led to what was described in the New York Times 
yesterday as a new breed of super-donor. About two dozen 
individuals, couples or corporations have given a million 
dollars or more this year to Republican superPACs that have 
poured that money directly into this year's presidential 
campaign.
    SuperPACs, both Republican and Democratic, are empowered by 
the Supreme Court's Citizens United decision and other rulings 
to collect unlimited contributions from individuals, 
corporations and unions. We're going to talk about this new 
post-Citizens United world of campaign financing.
    Our first guest is Trevor Potter, who has become something 
of a celebrity since he became Stephen Colbert's lawyer and 
advised Colbert on how to create his own superPAC. Potter is 
the founding president of the Campaign Legal Center and helped 
defend the 2002 McCain-Feingold law, which enacted campaign 
finance restrictions.
    From 1991 to '95, he served on the Federal Election 
Commission. He served as general counsel to John McCain's 
presidential campaigns in 2000 and 2008. Potter has not only 
been advising Stephen Colbert on his PAC, Potter helped Colbert 
set up an organization known as a 501(c)(4). Officially 
designated as social welfare organizations, 501(c)(4)s have 
spent tens of millions on advertising in political campaigns, 
and they are not required to disclose their donors. Here's 
Stephen Colbert and Trevor Potter on ``The Colbert Report,'' 
setting up a 501(c)(4).
    (SOUNDBITE OF TV SHOW, ``THE COLBERT REPORT'')

          STEPHEN COLBERT: So how do I gets me one, Trevor?
          TREVOR POTTER: Well, lawyers often form Delaware 
        corporations, which we call shell corporations, that 
        just sit there until they're needed.
          COLBERT: So like some anonymous shell corporation?
          POTTER: Right, and I happen to have one here in my 
        briefcase.
          COLBERT: Let's see it. OK, what's it called?
          POTTER: It's called Anonymous Shell Corporation.
          (SOUNDBITE OF LAUGHTER)
          COLBERT: OK, brrmm, brrmmm, Anonymous Shell 
        Corporation filed in Delaware. OK, I got this. So now I 
        have a (c)(4)?
          POTTER: Right, now we need to turn it into your shell 
        corporation, your anonymous one, and we do that by 
        having normally a board of directors meeting.
          COLBERT: And who's on the board of directors?
          POTTER: Well, just you. We can just have you do this.
          COLBERT: Sounds like a nice group of people.
          (SOUNDBITE OF LAUGHTER)
          COLBERT: All right, let's do it. Call to order. Let's 
        do this thing.
          POTTER: All right. So this says that you are the sole 
        director of the corporation.
          COLBERT: I am.
          POTTER: And that you are now electing yourself 
        president, secretary and treasurer.
          COLBERT: Sounds like a great board.
          POTTER: And you are authorizing the corporation to 
        file the papers with the IRS in May 2013.
          COLBERT: So I could get money for my (c)(4), use that 
        for political purposes, and nobody knows anything about 
        it till six months after the election?
          POTTER: That's right, and even then they won't know 
        who your donors are.
          COLBERT: That's my kind of campaign finance 
        restriction. OK, OK, so now I've signed it. I have a 
        (c)(4)?
          POTTER: You have a (c)(4). It's up and going.
          COLBERT: Can I take this (c)(4) money and then donate 
        it to my superPAC?
          POTTER: You can.
          (SOUNDBITE OF LAUGHTER)
          COLBERT: But wait, wait, superPACs are transparent.
          POTTER: Right, and . . .
          COLBERT: And the (c)(4) is secret. So I can take 
        secret donations of my (c)(4) and give it to my 
        supposedly transparent superPAC . . .
          POTTER: And it'll say given by your (c)(4).
          COLBERT: What is the difference between that and 
        money laundering?
          (SOUNDBITE OF LAUGHTER)
          POTTER: It's hard to say.
          (SOUNDBITE OF LAUGHTER)
          COLBERT: Well, Trevor, thank you so much for setting 
        me up.

    GROSS: That's my guest, Trevor Potter, with Stephen Colbert 
on ``The Colbert Report.'' Trevor Potter, welcome to FRESH AIR.
    POTTER: Thanks, Terry, good to be with you.
    GROSS: So what can Stephen Colbert now use his 501(c)(4) to 
do?
    POTTER: Well, it can engage in direct political activity. 
It can urge the election or defeat of candidates. It could 
lobby Congress, any number of public efforts related to public 
policy, essentially.
    GROSS: So the 501(c)(4) is officially supposed to be a 
social welfare organization?
    POTTER: Yes, that's the oddity here, of course, is that 
I've started by saying it could engage in political activity 
and run radio and television ads, which is not what we think of 
(c)(4)s doing. But through a combination of lassitude by the 
IRS and general confusion, (c)(4)s are now being used to engage 
in political activities. That wasn't the idea. They were set up 
by Congress to do public policy work, which was usually thought 
of as lobbying or arguing for one side or another of an issue 
in public.
    But they've become very popular because they do not 
disclose their donors, and they can engage in some amount of 
political work. There's a dispute in the--amongst tax lawyers 
as to how much work they can engage in, but many lawyers would 
say up to just under half of their spending can be for directly 
political activities, including urging the election or defeat 
of federal candidates, and they can do all that with money that 
is not disclosed to the public.
    GROSS: So you were an advisor to John McCain's campaign in 
2000 and 2008. You served on the Federal Elections Commission. 
What can candidates do now when raising money that they weren't 
allowed to do before, that they weren't allowed to do under 
McCain-Feingold?
    POTTER: We're really in a different world. Part of it 
involves candidates raising money, but most of it involves 
these new so-called superPACs. Throughout the--almost all of my 
career, until this year, what candidates could do was raise a 
small amount of money from each individual donor, it used to be 
$1,000, and then under McCain-Feingold it became $2,000 and was 
inflation-adjusted, so it's 2,500. But that's still a very 
small amount of money that an individual can give to a 
candidate.
    So throughout the campaigns I've been involved with, 
candidates would have fundraisers and accept contributions of 
maybe as little as 250 or $500 from donors. They would hope to 
have someone max out, as they call it, at the full $2,500 this 
year, and then if their spouse gave, you could double that to 
now 5,000.
    And that's the sort of money that candidates have been 
looking for. It has led, over the last couple cycles, to what 
we call bundlers, which means people who have a lot of wealthy 
friends they can ask money for, so that you go to a fundraiser, 
and your host gives you the 5,000, themselves and their spouse, 
but then they've asked their friends, their neighbors, their 
business associates, people in the same line of work to come to 
the fundraiser.
    And in the McCain experience, where you may recall he was 
running really a low-funded campaign for a long period of time, 
they'd be thrilled if they could raise $25,000 at a fundraiser. 
$50,000 was a very successful fundraiser. Well, you jump from 
that sort of world to the world of the superPACs, where 
individuals can and do give $100,000, $500,000, some have given 
more than a million.
    Famously, one of Newt Gingrich's supporters has given, I 
believe, 10 million between himself and his spouse to these 
supposedly outside groups that then spend money to elect the 
candidates. So we've changed the game from what really are 
small donors, either over the Internet or a couple hundred 
dollars, to a world where one person or a handful of people can 
bankroll a presidential candidate.
    GROSS: So the people who you're referring to, the husband 
and wife who gave to the Newt Gingrich campaign, that's Sheldon 
Adelson and his wife, they apparently saved the Newt Gingrich 
campaign because Gingrich wouldn't have had the money to carry 
on; a similar thing with Rick Santorum and one of his major 
funders, Foster Friess. Would they have been able to do that in 
previous years? I mean, would there be a way that they could 
have just given as individuals to the campaigns, as opposed to 
giving through a PAC?
    POTTER: No, there really isn't. What they could have done 
in previous years is taken their own personal money and spent 
it, in the case of Gingrich in South Carolina, in the case of 
the Romney backers, they could have spent it in Iowa, but they 
would have had to do so by putting their own names on an ad.
    So it would have said, you know, I'm Adelson and I approved 
this ad and it's paid for by me. And no donor, no matter how 
wealthy, has ever really done that in the 30 years since 
Watergate, when these laws were put into effect. What changed 
this . . .
    GROSS: Why not? Why not?
    POTTER: That's a good question. I think because people 
first of all are much more comfortable giving to an organized 
political entity, which is what these political committee 
superPACs are. What you would have had to have done, before 
this year, is decide that you wanted to support a particular 
candidate. You would have had to go out and find somebody who 
knew how to do political ads, where to spend them, what the 
most effective approach was.
    You'd create your budget. You then would have hired the 
professionals, done the ads and then put your name on them. So 
you essentially would become a political player yourself. And I 
think the wealthy individuals who are giving, in most cases 
that just doesn't occur to them to do something like that. They 
say what entity can I give to.
    GROSS: So the Supreme Court decision Citizens United opened 
the door for the creation of superPACs, and superPACs can get 
as much money as any individual corporation wants to give, but 
they have to reveal who they are. So . . .
    POTTER: Right. To be fair on this--to the court, at least--
what they said is corporations have the same right as 
individuals to make independent political expenditures. Then 
along came a lower court, the D.C. Circuit, which said if you 
have a right, a constitutional right to make independent 
expenditures on your own, you have a constitutional right to do 
so through a political committee.
    And so superPACs didn't come directly from Citizens United, 
but they came from a lower court effectively sort of guessing 
that the Supreme Court meant to include the sort of groups we 
are now seeing, where they take unlimited contributions from a 
number of people and then engage in this unlimited spending.
    GROSS: So watching this campaign, what are some of the 
loopholes you've seen playing out in ads, in funding--you know, 
some of the things that weren't in--that you think the Supreme 
Court didn't necessarily count on but people have found 
loopholes and ways around so that they can do it anyways?
    POTTER: I think there are two things that we are seeing 
play out here that are clearly contrary to what the Supreme 
Court was thinking, maybe three. So the first is that the court 
assumes, as a matter of law, that this spending is going to be 
independent of the candidates. In their original case, the 
Buckley v. Valeo case, they talk about independent spending 
being spending that is wholly independent of candidates and 
campaigns.
    And because it's wholly independent, the court says it 
can't corrupt the candidate, you're not buying anything, 
there's no agreement with the candidate. The candidate might 
not even like the spending, and therefore since it's wholly 
independent, and there's no danger of corruption, it cannot be 
constitutionally limited. That's the theory.
    Well, the practice is we are seeing these committees are 
actually pretty closely tied to candidates. They are not 
anyone's definition of wholly independent. They are created and 
run by friends of the candidates, family members of the 
candidates, former employees of the candidates, longtime 
fundraisers of the candidates, business partners of the 
campaign manager.
    There is a whole web of ties here. The effect of that is 
that when donors give to these committees, they feel they are 
safely giving to a group that has the candidate's best 
interests in mind and knows what the candidate wants. This is 
amplified by the fact that candidates refer to them as my 
superPAC, which a number of candidates do, or the superPAC run 
by my good friends.
    Under an advisory opinion from the Federal Election 
Commission last year, it is permissible for these candidates to 
attend meetings of donors, potential supporters for these PACs, 
and endorse the PAC. They can't solicit an unlimited amount of 
money, but they can go in and say you're doing great work, this 
is really important to my campaign. If the message is these are 
my people, I want you to support this group, then someone can, 
in fact, go out and write a check for a million dollars. They 
just can't be directly solicited by the candidate.
    So we've ended up in a world that I think the Supreme Court 
did not understand or expect in Citizens United, where these 
supposedly wholly independent groups are closely linked to the 
candidates, where the people running the groups say, well, I 
decide what to do because I watch the candidate on television 
and do what he suggests, which is what one of the Gingrich 
people said.
    So there's a close tie in the fundraising, in the 
personnel, in the goals of these groups, with individual 
candidates. And that's simply, I think, functionally very 
different from what the court thought was going to happen.
    GROSS: So theoretically the head of the superPAC and the 
candidate are not supposed to coordinate, but given all the 
ties that you've just pointed out, one has to assume that 
there's some amount of knowledge of what the other is doing.
    And I want to play another clip from ``The Colbert Report'' 
that kind of--that I think kind of, you know, really 
illustrates really well the kind of loopholes to help you get 
around the no-coordination rule. And this is a scene from ``The 
Colbert Report'' after Colbert has decided to run for president 
of South Carolina. So he has to give up his superPAC, the 
superPAC that you helped him create.
    So he hands it over to Jon Stewart, in spite of the fact 
that they're business partners, and it's legal, in spite of the 
fact that they're business partners. And in this scene, Colbert 
and Stewart are asking for your advice, since you are at this 
point not only Colbert's lawyer, but you've become Stewart's 
lawyer too, since he now heads the superPAC. And that's legal.
    POTTER: Right, something they point out they think is also 
a little odd that is legal.
    GROSS: Right, OK, so here we go. Jon Stewart speaks first.

          (SOUNDBITE OF TV SHOW, ``THE COLBERT REPORT'')
          JON STEWART: Now that I have the superPAC, can I run 
        ads supporting Stephen Colbert, who I believe in very 
        deeply, perhaps attacking his potential opponents, who 
        I don't believe in at all?
          POTTER: Yes, you can, as long as you do not 
        coordinate.
          (SOUNDBITE OF LAUGHTER)
          COLBERT: Well, that's interesting.
          (SOUNDBITE OF LAUGHTER)
          STEWART: Red flag.
          COLBERT: What?
          STEWART: I am busy.
          COLBERT: Of course. You have a show.
          STEWART: Can I legally hire Stephen's current 
        superPAC staff to produce these ads that will be in no 
        way coordinated with Stephen?
          POTTER: Yes.
          STEWART: Whew. . . !
          POTTER: As long as they have no knowledge of 
        Stephen's plans.
          COLBERT: Well, that's easy. I don't know what the 
        hell I'm doing.
          (SOUNDBITE OF LAUGHTER)
          COLBERT: OK, Jon, I guess you'd better leave for fear 
        that we would coordinate with each other. I cannot let 
        you know my plans.
          STEWART: I don't want to know.
          COLBERT: From now on, Jon, from now on, I will just 
        have to talk about my plans on my television show and 
        just take the risk that you might watch it.

    GROSS: OK, so that was a scene from ``The Colbert Report'' 
with Jon Stewart and Stephen Colbert. That's an interesting 
point there, that, you know, you're not supposed to coordinate, 
but the PAC, the people who are running the PAC at the very 
least know what you're saying from your speeches. I mean, they 
know what your priorities are. They know what you want.
    POTTER: Well, and in this election cycle, whether it's life 
imitating art or the other way around, but you had a situation 
in South Carolina where Newt Gingrich went out and said I can't 
coordinate with my superPAC, but I can speak to them publicly, 
and I am speaking to them right now, and I am asking them to 
take down certain ads or to at least correct the text of them.
    So you have this example in real life of a candidate not 
communicating while communicating with a superPAC. I think what 
that Colbert episode points out, as you sort of walk through 
it, is that the rules that the Federal Election Commission has 
established for what constitutes coordination are just 
ridiculously narrow. In fact, two federal courts have told the 
Federal Election Commission that they are inadequate and 
ordered them to come up with new rules, but they haven't done 
so.
    So for the moment the rules simply cover a candidate 
requesting or advising a PAC on the content of the message or 
where it is broadcast, as opposed to any of the other things 
that they might do, such as help with fundraising, share staff 
over time, something like that.
    GROSS: Now, do you think that the Supreme Court anticipated 
any of the loopholes that we're seeing or even anticipated the 
existence of superPACs or anticipated that 501(c)(4)s and 
(c)(6)s would be used as ways of funneling opaque money into 
the theoretically transparent superPAC?
    POTTER: Well, we actually know the answer to that, which is 
no, they didn't anticipate it. The reason we know it is that 
Justice Kennedy wrote in his majority opinion in Citizens 
United that today for the first time corporations will be able 
to give unlimited--spend unlimited amounts for independent 
expenditures and also that will be fully disclosed, so that 
shareholders will know where their money is going, and citizens 
will know who is spending on the ads they're seeing.
    And then he goes on for several pages to talk about how 
important it is to have that sort of disclosure, how people 
need to know where the money is coming from so that it isn't 
just some unknown group giving, but they have a sense of what 
the interests are being the spending.
    So he obviously thought that all of this spending was going 
to be disclosed. That's a little bit of a mystery because even 
in 2010, when that decision came down, there had been a fair 
amount of stories about spending by 501(c)(4)s and (c)(6)s and 
how that money wasn't disclosed. But they also hadn't had any 
real experience here.
    They appear not to have been aware of the details of some 
of the FEC's regulations and enforcement actions, where the 
commission has not enforced the existing spending laws. And 
this is a case--that's an element of the case. It was not 
briefed to the Supreme Court.
    You may recall that one of the things about Citizens United 
is that it was really on a rush schedule. It was a special case 
with its own day of oral argument, and there a lot of aspects 
that were not considered when the court was saying do 
corporations have a right as people, as persons, to make this 
independent expenditures. So the court assumed and stated that 
there would be full disclosure, when, in fact, that's not how 
the system is working. And I think that has to be a big 
surprise to Justice Kennedy who wrote that.
    GROSS: So let's talk about where the FEC, the Federal 
Election Commission, comes in. You used to serve on the 
commission. Part of its job is to hold candidates and PACs 
accountable. How good of a job has it been doing?
    POTTER: Well, it's had its critics for years. One of the 
reasons I joined the commission is that as a lawyer in private 
practice I was frustrated by the commission. I thought it 
wasn't being very effective or very efficient. And I thought, 
well, this is an opportunity to improve the way the agency 
operates.
    However, the criticism the commission is really changed in 
recent years--because people used to say the commission was 
ineffective or disorganized. Now the complaint is the 
commission is again, and again, and again deadlocked and unable 
to act at all.
    There are three--effectively--Republicans, three Democrats 
on the commission. It takes four votes to do anything. And the 
three Republicans currently on the commission do not appear to 
believe that the commission should be a regulator of spending 
in elections. They are largely deregulatory in philosophy. They 
opposed or have criticized McCain-Feingold, the law that 
they're supposedly enforcing. And what we're seeing is a split 
on the commission between those commissioners who want to 
enforce the law and those who say it would be wrong to do so or 
that it would crimp speech.
    The result of that is the commission is essentially now 
missing in action. It is not a watchdog because it's sitting 
there tied up, unable to move by this 3-3 deadlock in a whole 
range of important cases.
    GROSS: So, if the FEC isn't serving as a watchdog is 
anybody else, or is any other group?
    POTTER: No. I think that's our current problem. The 
commission should be doing that. That's the role that Congress 
has assigned it--and it is not. By the way, five of the six 
commissioners have--are serving expired terms. They shouldn't 
be there. But the President has to nominate successors and 
Congress has to confirm them. And that hasn't happened.
    GROSS: You--the President hasn't even nominated people? Or 
that Congress just hasn't confirmed them?
    POTTER: He nominated one person who then withdrew. There 
are no nominees now for any of the five seats that are supposed 
to be vacant. And therefore, Congress hasn't done anything 
because there's no one to do anything with.
    The White House says privately that they haven't done 
anything because the Republicans' leadership on the Hill has 
not cooperated in helping them nominate names, identify 
Republicans who could serve. But either way, we have a deadlock 
on the commission, a deadlock in the nomination process between 
the White House and Congress, and a commission that is unable 
to function.
    At the same time, the IRS, which could be dealing with 
these C4s and the disclosure issues we've been talking about--
the political spending--has visibly done nothing. There is no 
sign that it is involved. In fact, they backed off recently 
when some of their agents--professional career people--were 
asking questions about C4s and their tax status and 
contributions to them, a number of Republican members of 
Congress objected and the IRS commissioner announced that it 
was all a mistake, they would no longer ask those questions of 
the C4s. So the IRS seems to be out of action, afraid, I think, 
of political controversy. That leaves the Justice Department.
    There two problems with that. One is, of course, it's part 
of the Obama administration, so that anything it does runs the 
risk of being seen as political and anti-Republican. And the 
other problem is that its jurisdiction is only if there is an 
actual criminal act. The FEC is supposed to enforce the laws, 
unless the violation is so bad that it is what the legal 
standard is knowing and willful--that you knew you were 
breaking the law and you did it anyway. And in that case, the 
Justice Department has jurisdiction. So that's a much higher 
standard for them to get involved.
    GROSS: So, let's get to like the bottom line of all this. 
Obviously, you think this kind of unlimited and often opaque 
campaign spending that is in a lot of ways actually kind of 
coordinated with the candidates, is not a good thing for the 
electoral process. That's your point of view, otherwise you 
wouldn't be opposed to this kind of unlimited spending. So make 
the case for us. What's the problem? I mean, why do you think 
that individuals and corporations shouldn't be allowed to give 
as many millions as they want?
    POTTER: Well, first . . .
    GROSS: And anonymously or by name.
    POTTER: Right. I mean first my initial objection as a 
lawyer is that I don't think what we're seeing now is what the 
law provides. I don't think it's what the Supreme Court was 
doing in the Buckley case and the Citizens United case. They 
didn't expect this coordination and this lack of disclosure. 
It's not what Congress provided for in McCain-Feingold in the 
parts that are still good law and should be enforced. So I 
think as what sometimes gets called an officer of the court, a 
person who is supposed to, as a lawyer, focus on public policy, 
I have a problem with the fact that what we're seeing now is 
not what the law says we should be seeing.
    Beyond that, when we look to the future and I think the 
only way we're going to get out of this mess is to have 
Congress again write a new law after this election cycle. The 
question of should you have unlimited, undisclosed spending in 
a democracy is the question on the table, because that's what 
we're heading to unless we change.
    I don't think that is healthy. It seems to me that you do 
have a real problem here of corruption. It becomes effectively 
bribery if you can give an unlimited amount to a candidate for 
office, who then acts on your legislative agenda--either to 
vote for legislation you want or to sink legislation you don't 
want. If that is secret, so that that money is given and the 
donor or the spender knows it and the beneficiary knows it but 
the public doesn't, I think you will see more mistrust of the 
political system.
    We run a risk here of citizens feeling that their vote 
doesn't count because the Members of Congress are going to do 
what the major donors tell them to do. We run a risk that 
people will think their small contribution doesn't count 
because candidates are going to get millions of dollars from 
people who can give that kind of money, not the average small 
donor. That, to me, is not how a democratic system works.
    GROSS: Trevor Potter, thank you so much for talking with 
us.
    POTTER: Thanks very much.
    GROSS: Trevor Potter is the founding president of the 
Campaign Legal Center and is Stephen Colbert's lawyer, advising 
Colbert on his superPAC.

                    [From Roll Call, June 20, 2012]


            Mitch McConnell vs. Himself on Disclosure Issues


                          (By Norman Ornstein)

    ``I think you'd have to go back to Richard Nixon to find 
the last time you had group of people both through the campaign 
and through the power of the federal government really trying 
to harass and silence critics, and I think they need to be 
called on it.''
    That was Senate Minority Leader Mitch McConnell (R-Ky.) 
talking to Fox News in his renewed public campaign against 
disclosure of contributors to campaigns and to groups trying to 
influence lawmakers and elections. It was startling to me: the 
Nixonian McConnell accusing proponents of transparency of 
Nixonian behavior. This may set a new standard for chutzpah.
    McConnell's comment was only part of his efforts; the 
central focus last week was his ballyhooed speech in ostensible 
support of the First Amendment at the American Enterprise 
Institute.
    Regrettably, I was on an airplane when McConnell gave his 
speech. Had I been there, I would have tried to ask the first 
question. (It would not be the first time I would have asked a 
question that cut against the grain at AEI; commendably, no one 
at my institution has ever tried to dissuade me or muzzle me.)
    My question, not surprisingly, would have started with 
McConnell's own eloquent words repeated many times in the years 
leading up to the passage of the Bipartisan Campaign Reform Act 
in 2002, his mantra about campaign finance reform for much of 
his career. Namely, that Republicans are in favor of 
disclosure, that disclosure is the core of campaign finance 
reform, including disclosure for so-called electioneering 
communications or ``issue advocacy'' that is clearly designed 
to influence election outcomes. It would have included 
McConnell's full-throated support for more and more disclosure 
during the debate on law. It would have asked what has 
changed--except the law and the presumed advantage McConnell 
and his partisans now have with huge and secret contributions 
to super PACs, 501(c)(4)s and other shadow and sham nonprofits 
set up to change election outcomes.
    McConnell now sings a different tune, one that complains 
about the criticism that the poor billionaires and corporations 
face when their contributions to these shadow groups are 
disclosed.
    His comment to Fox was a complaint about agencies such as 
the IRS enforcing their regulations and holding accountable 
organizations that manipulate the law to avoid lawful 
disclosure. In complaining that this is Nixonian, McConnell was 
trying to intimidate the IRS (which has long been too timid 
about cracking down on groups that have flaunted their clear 
political goals while claiming status as nonprofits that claim 
only modest involvement in political activities).
    If I had been able to follow up, I would have included a 
reference to the Supreme Court's full-throated support for full 
disclosure--8-1 even in Citizens United--and to Justice Antonin 
Scalia's statement in another case about the need for civic 
courage, for people to stand up in public for their political 
acts. As Scalia wrote, ``Harsh criticism, short of unlawful 
action, is a price our people have traditionally been willing 
to pay for self-governance.''
    And I would have asked why it is appropriate, even good, 
for powerful corporations and wealthy individuals to hide their 
deep involvement in political campaigns, leaving voters in the 
dark about who is paying millions for attack ads.
    McConnell is not the only hypocrite here, although he wins 
the title of Hypocrite-in-Chief. When the DISCLOSE Act came up 
in the Senate in the aftermath of Citizens United, it passed 
the House and got 59 votes in the Senate--but died on a 
filibuster because not a single Republican, including those who 
had supported campaign reform, was willing to support it.
    Now a stripped-down version is coming up--simply requiring 
disclosure of the name of anyone who gives more than $10,000 to 
a group to influence elections. There is no excuse for anyone 
who has voiced support for disclosure--even if they have not 
expressed the support as expansively as McConnell did in 2007, 
when he said, ``I think what we ought to do is we ought to have 
full disclosure, full disclosure of all the money that we raise 
and how it is spent''--to vote against this bill.
    McConnell's anti-disclosure stance has extended beyond his 
opposition to this bill. He is the driving force behind the 
failure of the Federal Election Commission, despite repeated 
rebukes by the courts, to enforce the laws on the books and 
court rulings about disclosure. Far more often than not, it is 
the three Republicans virtually handpicked by McConnell who 
have stymied the FEC from doing its job.
    Once, after I wrote a column criticizing FEC Commissioner 
Donald McGahn, McConnell wrote a pious rejoinder, saying that 
his oath was to enforce not just the laws passed by Congress 
but the rulings of the Supreme Court--except, apparently, when 
he doesn't like what the court has written. Thus, McGahn and 
his posse have repeatedly flouted the 8-1 Supreme Court 
position on disclosure.
    The DISCLOSE Act is a modest step to bring us the kind of 
system that McConnell used to lionize. It will likely fail on a 
filibuster. And that should at least open up the way for 
another action by President Barack Obama, using his recess 
appointment authority to replace McGahn and four other 
commissioners whose terms have expired to bring back a 
commission that will do its job and counter the real Nixonian 
actions, evasion of disclosure.

                  [From OpenSecretsblog, May 18, 2012]


 Mystery Health Care Group Funneled Millions to Conservative Nonprofits


                  (By Viveca Novak and Robert Maguire)

    A secretive, well-funded group whose name gives the 
misleading impression that it is solely concerned about health 
care gave more than $44 million in 2010 to other tax-exempt 
groups, many of which spent millions on TV ads attacking 
Democrats running for the House and Senate and have begun 
spending for the same purpose this year.
    None of the groups--including eight of the most politically 
active nonprofits in 2010--disclose their donors, and the role 
of the Center to Protect Patients' Rights (CPPR) in funding 
them has not previously been reported.
    Based in Arizona, CPPR provided large grants to a cluster 
of well-known conservative organizations that operate under 
section 501(c)(4) of the tax code, which classifies them as 
``social welfare'' groups and allows them to keep their funding 
sources from public view. Politics is not supposed to be their 
primary purpose, although critics say many of the organizations 
have stretched the rules too far.
    American Future Fund received the largest grant from CPPR, 
a total of $11.7 million for ``general support.'' That amount 
exceeded the nearly $10 million the group told the Federal 
Election Commission it spent supporting or opposing Democratic 
candidates in ads in the midterm elections (``independent 
expenditures'') or broadcasting slightly less explicit appeals 
close to election day (``electioneering communications''). In 
fact, the gift was more than half of the $23.3 million the 
group raised all year.
    American Future, which is based in Iowa, ran a series of 
hard-hitting ads against Democratic candidates around the 
country in 2010 that left little doubt where the group stood, 
even when the ads didn't refer to the election. ``With the 
biggest tax cut in American history looming, [Bruce] Braley was 
the deciding vote to adjourn the house. Instead of fighting for 
lower taxes, Braley went home,'' one ad, which ran in October 
2010, said of the Iowa Democrat. ``Tell Braley: Don't vote to 
raise taxes on Iowa families.''

                          LAYERS OF ANONYMITY

    The donors to the Center to Protect Patient Rights are 
almost entirely unknown. Such tax-exempt organizations must 
detail the groups to whom they gave grants, but not the sources 
of their own funds. A small grant of $200,000 came to CPPR from 
American Action Network, yet another 501(c)(4), according to 
the Form 990 tax return that American Action filed with the 
Internal Revenue Service this week.
    And if its donors are unknown, so is much else about CPPR. 
According to its own 2010 tax return, which was filed last 
November, it is run by Sean Noble, who is listed as its 
director, president and executive director. Noble describes 
himself on his Twitter account as a ``PR/Political consultant, 
conservative strategist/operative, former GOP Hill chief of 
staff, blogger, proud father, fighting for liberty.'' Noble was 
chief-of-staff to former Republican Rep. John Shadegg of 
Arizona, for whom he worked for 13 years, and since then has 
worked as a political consultant and in public relations.
    Noble took no salary from CPPR, but his firm, Noble 
Associates, was paid $340,000 by the group for ``management 
services.'' Noble was also paid $10,000 to lobby for the group.
    He is currently managing partner of DC London Inc., a 
political consulting firm that offers robo-calling and other 
services. CPPR's other director and secretary is Courtney 
Koshar, an anesthesiologist in the Phoenix area.
    The organization's mission, as listed on the tax form, is 
``Building a coalition of like-minded organizations and 
individuals, and educating the public on issues related to 
health care with an emphasis on patients rights. Engaging in 
issue advocacy and activities to influence legislation related 
to health care.''
    Noble did not return our calls seeking comment. But in a 
piece last year, Politico described Noble as a ``Koch 
operative,'' referring to the wealthy conservative brothers 
from Koch Industries who have been instrumental in funding a 
conservative network of groups. Open Secrets Blog has been 
unable to confirm the Koch connection independently.
    Adding to the confusion is the fact that CPPR's name is 
almost exactly the same as that of another group, the Coalition 
to Protect Patients' Rights, a group that organized lobbying 
efforts against health care overhaul proposals being debated in 
Congress in 2009. And CPPR gave the Coalition $205,000 in 2010. 
Further, the records for both groups were listed as being 
stored at the same Glendale, Ariz., address by a woman who 
describes herself as an employee of DCI Group, a lobbying firm 
practiced in manufacturing ``grassroots'' campaigns for the 
tobacco industry and others that has handled public relations 
for the Coalition.
    But the Coalition's spokesman, physician and lawyer, Donald 
Palmisano, told Open Secrets Blog he'd never heard of the other 
group, as did a publicist with DCI Group.
    The second-largest grant from CPPR, $5.6 million, went to 
Americans for Limited Government, also for ``general support,'' 
as were all the CPPR gifts. That amounted to more than half the 
group's $9 million budget for 2010. The creation of libertarian 
real estate mogul Howard Rich, Americans for Limited Government 
distributes money to its own large network of 501(c)(3) and 
(c)(4) organizations. One such group, Colorado at Its Best, in 
turn funded a group called Clean Government Colorado in 2008, 
which backed a ballot initiative that critics said would limit 
the ability of public employees' unions to make political 
contributions. In 2010, ALG funded a group called Alaskans for 
Open Government, which in turn provided money to another group 
backing an ``anti-corruption'' ballot initiative. The Alaska 
group eventually ran into trouble over failing to disclose its 
own sources of funding.
    Americans for Job Security received $4.8 million from CPPR. 
That group, which is a 501(c)(6) business association under the 
tax code, spent about $9 million in the 2010 elections 
expressly attacking Democrats and running electioneering ads, 
according to Center for Responsive Politics figures. It has a 
history of running attacks on Democrats dating back to the late 
1990s.
    Other beneficiaries of CPPR funding included anti-tax maven 
Grover Norquist's Americans for Tax Reform, which received $4.2 
million and spent about that amount on independent expenditures 
in 2010, almost all against Democrats; Americans for 
Prosperity, which has strong ties to Charles and David Koch and 
which received close to $2 million from CPPR and spent a little 
less than that on negative issue ads mentioning candidates 
close to the election; and Club for Growth, which received 
$690,000 from CPPR and spent more than $8 million on 
independent expenditures against Democrats in 2010, as well as 
against some Republicans in primary contests.
    All these groups may have spent more--and in some cases 
definitely did so--on political ads that escaped reporting 
requirements. For instance, according to its 990 form, American 
Future spent a total of $21.4 million in 2010, of which $14.7 
went to ``media services,'' indicating possible spending on ads 
that was greater than the $10 million it reported to the 
Federal Election Commission.
    This table shows all the recipients of CPPR grants in 2010:

------------------------------------------------------------------------
                      Non-Profit                        2010 CPPR Grant
------------------------------------------------------------------------
American Future Fund.................................        $11,685,000
60 Plus Assn.........................................          8,990,000
Americans for Limited Government.....................          5,585,000
Americans for Job Security...........................          4,828,000
Americans for Tax Reform.............................          4,189,000
Revere America.......................................          2,300,000
Americans for Prosperity.............................          1,924,000
US Health Freedom Coalition..........................          1,430,000
Susan B Anthony......................................          1,025,000
Club for Growth......................................            690,000
Americans United for Life Action.....................            559,000
The Institute for Liberty............................            457,000
American Energy Alliance.............................            250,000
Coalition to Protect Patient Rights..................            205,000
Freedom Vote.........................................            200,000
Protect Your Vote....................................            100,000
Hispanic Leadership Fund.............................             47,000
Americans United for Life............................             45,000
Tea Party Patriots...................................             30,000
Common Sense Issues Coalition........................             25,000
Common Sense Issues..................................             10,000
Concerned Women 4 America............................              4,500
------------------------------------------------------------------------

    Another recipient of CPPR's money is Freedom Vote, a 501c4 
based in Columbus, Ohio that was created by Republican 
operatives in 2010 to finance get-out-the-vote operations 
usually done by the party. The group had a total income of $1.3 
million that year, according to its 990; $200,000 of it came 
from CPPR. Another $900,000 came from Crossroads GPS.
    Jim Nathanson, who identified himself as Freedom Vote's 
executive director, told Open Secrets Blog that the group is 
still active and planning on participating in the 2012 
election, but said the organization is ``still in the planning, 
formulating stage. We are doing things, but nothing is 
finalized.'' Asked whether the group is fundraising, Nathanson 
said it is, but wouldn't go into details. ``It probably 
wouldn't be appropriate to say anything, simply because things 
are not fully developed.''

                         LINKS BETWEEN GRANTEES

    The tax documents of American Action, the Center to Protect 
Patients Rights and some other politically active groups--
especially on the Republican side, where such groups are more 
prevalent--make it plain that a number of deep-pocketed donors 
are willing to help finance tax-exempt groups that spend at 
least a portion of their resources attacking the other party. 
Many seem to prefer remaining anonymous and hence prefer making 
gifts to c(4)s rather than super PACs. Each super PAC must 
disclose its donors.
    Some of the groups receiving CPPR funds did, in fact, 
concentrate on health care, or at a minimum on opposition to 
the Patient Protection and Affordable Care Act signed into law 
by President Obama on March 23, 2010. One of those, the US 
Health Freedom Coalition, was given $1.4 million by CPPR and 
bankrolled a proposition on the Arizona ballot in 2010 
rejecting the requirement in the federal health care overhaul 
that all individuals have health insurance. (It passed.)
    Several of the recipients of funds from CPPR are anti-
abortion groups: the Susan B Anthony List, Americans United for 
Life and Americans United for Life Action received a total of 
$1.85 million. Another $35,000 went to two arms of an 
organization called Common Sense Issues, which had used 
controversial ``push-polling'' to help former Arkansas Gov. 
Mike Huckabee's presidential bid in 2008. In 2010, it asked 
candidates to sign a pledge to oppose taxpayer funding of 
abortion and ran ads in a number of House and Senate races.
    Some of the recipients of CPPR's largesse are linked in 
another way: they use the same vendors. For instance, five of 
the groups, led by Americans for Limited Government and the 
American Future Fund, paid a total of about $7.5 million to a 
Phoenix firm called Direct Response for telecommunications and 
direct mail.
    Mentzer Media made more than $25 million in 2010 from four 
CRRP grant recipients plus American Crossroads and Crossroads 
GPS, the super PAC and 501(c)(4) linked to Karl Rove. The 
American Future Fund paid Mentzer the largest sum, $10 million.
    Mentzer is being used this year by the pro-Mitt Romney 
super PAC Restore Our Future, and in 2004 made more than $18 
million running the Swift Boat Veterans for Truth attacks on 
the war record of Democratic presidential candidate John Kerry.
    Staff at the Democratic Congressional Campaign Committee 
were unaware of CPPR, though they are highly familiar with its 
grantees, many of which ran ads against the House candidates 
the DCCC was supporting in 2010. ``Voters have a right to know 
who is behind the ads they see so they can evaluate the 
claims,'' said Deputy Executive Director Jennifer Crider, 
bemoaning the fact that some 501(c)(4) organizations are 
extremely active on the political front but, unlike other 
political organizations, don't have to release the names of 
their donors.
    The DCCC's former chairman, Rep. Chris Van Hollen of 
Maryland, recently won a lawsuit challenging an FEC rule that 
allowed groups like those funded by CPPR to avoid disclosing 
their donors when they ran electioneering communications ads. 
This month an appellate court refused to stay the decision. 
It's unclear, though, what that means for disclosure in this 
cycle. There's evidence that groups have responded to the 
ruling by not running ads that fit the definition of 
electioneering communications.

                        APPENDIX B: DATA SOURCES
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>


        SUPER PAC DONATIONS THROUGH 18 JUNE, 2012, TO SUPER PACS REPORTING AT LEAST $1M IN TOTAL RECEIPTS
                              [Accounting for 89.75% of total disclosed donations]
----------------------------------------------------------------------------------------------------------------
                   Super PAC      Donors     Donations     Total Donated     Average Donation  Average per Donor
----------------------------------------------------------------------------------------------------------------
1              RESTORE OUR           602           752      $56,512,634.77         $75,149.78         $75,149.78
                FUTURE, INC.
2              AMERICAN              261           326      $29,884,896.20         $91,671.46         $91,671.46
                CROSSROADS.
3              WINNING OUR           152           174      $23,809,014.33        $136,833.42        $136,833.42
                FUTURE.
4              PRIORITIES USA        334           405      $10,543,760.62         $26,033.98         $26,033.98
                ACTION.
5              CLUB FOR GROWTH       597           790       $6,409,709.13          $8,113.56          $8,113.56
                ACTION.
6              MAJORITY PAC....      100           121       $6,114,774.36         $50,535.33         $50,535.33
7              WORKERS' VOICE..       12            18       $5,908,363.73        $328,242.43        $328,242.43
8              HOUSE MAJORITY         80           111       $5,881,363.59         $52,985.26         $52,985.26
                PAC.
9              AMERICAN BRIDGE        70           121       $5,872,747.72         $48,535.11         $48,535.11
                21ST CENTURY.
10             MAKE US GREAT          60            66       $5,585,174.00         $84,623.85         $84,623.85
                AGAIN, INC.
11             CONGRESSIONAL          38            42       $5,223,752.65        $124,375.06        $124,375.06
                LEADERSHIP FUND.
12             ENDORSE LIBERTY,       89           102       $3,570,296.27         $35,002.90         $35,002.90
                INC.
13             NEA ADVOCACY            3             5       $3,510,951.65        $702,190.33        $702,190.33
                FUND.
14             FREEDOMWORKS FOR      500           741       $3,302,311.66          $4,456.56          $4,456.56
                AMERICA.
15             OUR DESTINY PAC.       24            37       $3,188,364.25         $86,172.01         $86,172.01
16             CAMPAIGN FOR           63            71       $2,869,667.00         $40,417.85         $40,417.85
                PRIMARY
                ACCOUNTABILITY
                INC.
17             COOPERATIVE OF          2            34       $2,556,100.94         $75,179.44         $75,179.44
                AMER.
                PHYSICIANS IE
                COMMITTEE.
18             NAT'L ASSOC. OF         1            14       $1,810,778.00        $129,341.29        $129,341.29
                REALTORS
                CONGRESSIONAL
                FUND.
19             TEXAS                  21            21       $1,430,000.00         $68,095.24         $68,095.24
                CONSERVATIVES
                FUND.
20             PLANNED                 7            10       $1,113,663.28        $111,366.33        $111,366.33
                PARENTHOOD
                VOTES.
                                --------------------------------------------------------------------------------
               Totals:.........    3,016         3,961        $185,098,324         $46,730.20        $61,372.12
----------------------------------------------------------------------------------------------------------------
The mean average donation reported to FEC during this cycle was for $23,947. The median donation was for $500.
Data courtesy of Federal Election Commission; Analysis and Aggregation by Mr. Gonzalez's Personal Staff.


                                                         THE MOST EXPENSIVE SEAT IN THE HOUSE: THE STATE OF OUR CAMPAIGN FINANCE SYSTEM
                                                                       House Campaign Spending (In Constant 2012 Dollars)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                    % D
                                                                Average Spent   Increase From  % D Year-over-   D of   Average Winner  % D of  Most Expensive    Increase From     Year-  % D of
                             Year                              per House Seat   Previous Year       Year        1990        Spent       1990       Single        Previous Year     over-   1990
                                                                                                                                                  Campaign                         Year
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1990.........................................................        $948,686  ..............  ..............      0%        $715,303      0%      $2,996,907  .................  ......       0
1992.........................................................       1,239,637        $290,951           30.67      31         888,790      24       8,886,573      $5,889,665.18     197     197
1994.........................................................       1,231,840          -7,798           -0.63      30         798,888      12       4,057,667      -4,828,905.09     -54      35
1996.........................................................       1,420,559         188,720           15.32      50         985,024      38       8,154,769       4,097,101.23     101     172
1998.........................................................       1,285,093        -135,466           -9.54      35         915,356      28      10,665,625       2,510,856.03      31     256
2000.........................................................       1,576,481         291,388           22.67      66       1,119,385      56       9,278,164      -1,387,460.26     -13     210
2002.........................................................       1,541,815         -34,666           -2.20      63       1,145,282      60      10,392,436       1,114,271.20      12     247
2004.........................................................       1,623,283          81,468            5.28      71       1,255,917      76       6,088,721      -4,303,714.96     -41     103
2006.........................................................       1,966,348         343,065           21.13     107       1,622,323     127       9,231,153       3,142,432.16      52     208
2008.........................................................       1,979,024          12,676            0.64     109       1,558,049     118       7,802,737      -1,428,415.41     -15     160
2010.........................................................       2,615,963         636,938           32.18     176       1,514,858     112      12,268,240       4,465,502.46      57    309
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Amounts derived from the Campaign Finance Institute (http://www.cfinst.org/data/pdf/VitalStats_.pdf) and the Center for Responsive Politics (http://www.opensecrets.org/bigpicture/
  elec_stats.php?cycle=2010).
Inflation calculated via the Bureau of Labor Statistics CPI Inflation Calculator (www.bls.gov/data/inflation_calculator.htm).


                               SUPER PAC DONATIONS FROM FED-CODED ``ORGANIZATIONS'' THROUGH 18 JUNE, 2012, TO SUPER PACS REPORTING AT LEAST $1M IN TOTAL RECEIPTS
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                              Corporate       Total  Corporate   Average  Corporate   Average per  Corp.
                                              Super PAC               Corporate  Donors       Donations           Donations            Donation              Donor            Total  Donations
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1                                RESTORE OUR FUTURE, INC...........                 84                  95      $10,733,600.00         $112,985.26            $75,149.78         $56,512,634.77
2                                AMERICAN CROSSROADS...............                 25                  30        8,727,569.60          290,918.99             91,671.46          29,884,896.20
3                                WINNING OUR FUTURE................                  1                   1            1,000.00            1,000.00            136,833.42          23,809,014.33
4                                PRIORITIES USA ACTION.............                  6                   8          485,234.42           60,654.30             26,033.98          10,543,760.62
5                                CLUB FOR GROWTH ACTION............                  2                  44           90,457.63            2,055.86              8,113.56           6,409,709.13
6                                MAJORITY PAC......................                 12                  14          471,680.36           33,691.45             50,535.33           6,114,774.36
7                                WORKERS' VOICE....................                  6                  12        4,706,776.23          392,231.35            328,242.43           5,908,363.73
8                                HOUSE MAJORITY PAC................                 80                 111        5,881,363.59           52,985.26             52,985.26           5,881,363.59
9                                AMERICAN BRIDGE 21ST CENTURY......                  9                  37        1,202,319.24           32,495.11             48,535.11           5,872,747.72
10                               MAKE US GREAT AGAIN, INC..........                 17                  19        1,867,000.00           98,263.16             84,623.85           5,585,174.00
11                               CONGRESSIONAL LEADERSHIP FUND.....                  4                   8           75,252.65            9,406.58            124,375.06           5,223,752.65
12                               ENDORSE LIBERTY, INC..............                  7                   7           12,500.00            1,785.71             35,002.90           3,570,296.27
13                               NEA ADVOCACY FUND.................                  3                   5        3,510,951.65          702,190.33            702,190.33           3,510,951.65
14                               FREEDOMWORKS FOR AMERICA..........                  7                 210        1,967,024.26            9,366.78              4,456.56           3,302,311.66
15                               OUR DESTINY PAC...................                  1                   1           22,819.35           22,819.35             86,172.01           3,188,364.25
16                               CAMPAIGN FOR PRIMARY                                7                   7          131,000.00           18,714.29             40,417.85           2,869,667.00
                                  ACCOUNTABILITY INC.
17                               COOP. OF AMER. PHYSICIANS IE                        2                  34        2,556,100.94           75,179.44             75,179.44           2,556,100.94
                                  COMMITTEE.
18                               NAT'L ASSOC. OF REALTORS CONG.                      *                   *                   *                   *                     *           1,810,778.00
                                  FUND.
19                               TEXAS CONSERVATIVES FUND..........                  5                   5          265,000.00           53,000.00             68,095.24           1,430,000.00
20                               PLANNED PARENTHOOD VOTES..........                  3                   6            3,663.28              610.55            111,366.33           1,113,663.28
                                                                    ----------------------------------------------------------------------------------------------------------------------------
                                 Totals:...........................                281                 654          42,711,313           65,307.82            151,997.56        185,098,324.15
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
N.B. ``Organization'' includes corporations including Yahoo! and Contran, LLC, as well as unions. E.g., 99.09% of donations to NEA Advocacy Fund came from three donations from NEA itself.
  ``Entity type is not a data element the FEC codes or validates,'' and these numbers reflect the filings by the Super PACs.
*The National Association of Realtors Congressional Fund disclosed 14 donations to FEC, each from ``Association of Realtors, National.'' However, as these were coded as coming from an
  individual rather than from an organization, they are not included here.
The mean average donation from an ``Organization'' reported to FEC during this cycle was for $44,593. The median donation from an ``Organization'' was for $2,543.
The mean average donation reported to FEC during this cycle was for $23,947. The median donation was for $500.
Data courtesy of Federal Election Commission; Analysis and Aggregation by Mr. Gonzalez's Personal Staff.


         SUPER PAC DONATIONS FROM FEC-CLASSIFIED ORGANIZATIONS THROUGH 18 JUNE, 2012, TO SUPER PACS REPORTING AT LEAST 1M IN CORPORATE DONATIONS
                                         [Accounting for 81.82% of total disclosed donations from organizations]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Corporate     Corporate     Total  Corporate     Average  Corporate
                                      Super  PAC               Donors       Donations         Donations             Donation         Average  per Donor
--------------------------------------------------------------------------------------------------------------------------------------------------------
1                           RESTORE OUR FUTURE, INC.......           84            95         $10,733,600.00           $112,985.26           $127,780.95
2                           AMERICAN CROSSROADS...........           25            30           8,727,569.60            290,918.99            349,102.78
3                           WORKERS' VOICE................            6            12           4,706,776.23            392,231.35            784,462.71
4                           NEA ADVOCACY FUND.............            3             5           3,510,951.65            702,190.33          1,170,317.22
5                           COOP. OF AMERICAN PHYSICIANS              2            34           2,556,100.94             75,179.44          1,278,050.47
                             IE COMMITTEE.
6                           FREEDOMWORKS FOR AMERICA......            7           210           1,967,024.26              9,366.78            281,003.47
7                           MAKE US GREAT AGAIN, INC......           17            19           1,867,000.00             98,263.16            109,823.53
8                           HOUSE MAJORITY PAC............           12            20           1,213,500.00             60,675.00            101,125.00
9                           AMERICAN BRIDGE 21ST CENTURY..            9            37           1,202,319.24             32,495.11            133,591.03
                                                           ---------------------------------------------------------------------------------------------
                            Totals:.......................          165           462          36,484,841.92             78,971.52            221,120.25 
--------------------------------------------------------------------------------------------------------------------------------------------------------
N.B. Organization Includes corporations including Yahoo! and Contran, LLC, as well as unions. E.g., 99.09% of donations to NEA Advocacy Fund came from
  three donations from NEA itself. ``Entity type is not a data element the FEC codes or validates'', and these numbers reflect the filings by the Super
  PACs.
Data courtesy of Federal Election Commission; Analysis and Aggregation by Mr. Gonzalez's Personal Staff.


        SUPER PAC DONATIONS THROUGH 18 JUNE, 2012, TO SUPER PACS REPORTING AT LEAST %1M IN TOTAL RECEIPTS
                              [Accounting for 89.75% of total disclosed donations]
----------------------------------------------------------------------------------------------------------------
                                                                                                         Average
                                     Super PAC               Donors       Donations    Total    Average     per
                                                                                      Donated  Donation   Donor
----------------------------------------------------------------------------------------------------------------
1                          RESTORE OUR FUTURE, INC......          602           752   $56,512  $75,149.  $75,149
                                                                                      ,634.77     78      .78
2                          AMERICAN CROSSROADS..........          261           326   29,884,  91,671.4  91,671.
                                                                                      896.20       6       46
3                          WINNING OUR FUTURE...........          152           174   23,809,  136,833.  136,833
                                                                                      014.33      42      .42
4                          PRIORITIES USA ACTION........          334           405   10,543,  26,033.9  26,033.
                                                                                      760.62       8       98
5                          CLUB FOR GROWTH ACTION.......          597           790   6,409,7  8,113.56  8,113.5
                                                                                      09.13                 6
6                          MAJORITY PAC.................          100           121   6,114,7  50,535.3  50,535.
                                                                                      74.36        3       33
7                          WORKERS' VOICE...............           12            18   5,908,3  328,242.  328,242
                                                                                      63.73       43      .43
8                          HOUSE MAJORITY PAC...........           80           111   5,881,3  52,985.2  52,985.
                                                                                      63.59        6       26
9                          AMERICAN BRIDGE 21ST CENTURY.           70           121   5,872,7  48,535.1  48,535.
                                                                                      47.72        1       11
10                         MAKE US GREAT AGAIN, INC.....           60            66   5,585,1  84,623.8  84,623.
                                                                                      74.00        5       85
11                         CONGRESSIONAL LEADERSHIP FUND           38            42   5,223,7  124,375.  124,375
                                                                                      52.65       06      .06
12                         ENDORSE LIBERTY, INC.........           89           102   3,570,2  35,002.9  35,002.
                                                                                      96.27        0       90
13                         NEA ADVOCACY FUND............            3             5   3,510,9  702,190.  702,190
                                                                                      51.65       33      .33
14                         FREEDOMWORKS FOR AMERICA.....          500           741   3,302,3  4,456.56  4,456.5
                                                                                      11.66                 6
15                         OUR DESTINY PAC..............           24            37   3,188,3  86,172.0  86,172.
                                                                                      64.25        1       01
16                         CAMPAIGN FOR PRIMARY                    63            71   2,869,6  40,417.8  40,417.
                            ACCOUNTABILITY INC.                                       67.00        5       85
17                         COOPERATIVE OF AMER.                     2            34   2,556,1  75,179.4  75,179.
                            PHYSICIANS IE COMMITTEE.                                  00.94        4       44
18                         NAT'L ASSOC. OF REALTORS                 1            14   1,810,7  129,341.  129,341
                            CONGRESSIONAL FUND.                                       78.00       29      .29
19                         TEXAS CONSERVATIVES FUND.....           21            21   1,430,0  68,095.2  68,095.
                                                                                      00.00        4       24
20                         PLANNED PARENTHOOD VOTES.....            7            10   1,113,6  111,366.  111,366
                                                                                      63.28       33      .33
                           Totals:......................        3,016         3,961   185,098  46,730.2  61,372.
                                                                                      ,324         0      12
----------------------------------------------------------------------------------------------------------------
The mean average donation reported to FEC during this cycle was for $23,947. The median donation was for $500.
Data courtesy of Federal Election Commission; Analysis and Aggregation by Mr. Gonalez's Personal Staff.


                   APPENDIX C: SUPPLEMENTAL MATERIALS
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>

      [From the Honorable Chris Van Hollen (D-MD), June 24, 2010]

     Remember When Washington Republicans Supported Disclosure and 
                             Transparency?

                            WHAT HAPPENED???

    Rep. John Boehner: ``I think what we ought to do is we 
ought to have full disclosure, full disclosure of all of the 
money that we raise and how it is spent. And I think that 
sunlight is the best disinfectant.'' (NBC, Meet the Press 
Transcript, 02/11/2007)
    Sen. Mitch McConnell: ``We need to have real disclosure. 
And so what we ought to do is broaden the disclosure to include 
at least labor unions and tax-exempt business associations and 
trial lawyers so that you include the major political players 
in America. Why would a little disclosure be better than a lot 
of disclosure?'' (The Hill, Campaign finance bill has GOP wary, 
04/22/2010)
    Rep. John Boehner: ``The House is going to take up 527 
legislation next week. And there may be several proposals on 
the floor in terms of how we rein in their activity. I think 
this was a gaping loophole in the McCain-Feingold campaign 
finance reform bill. I think it needs to be fixed. To have all 
of this unregulated campaign cash going to these organizations 
and allowing them to engage in campaign activities without any 
disclosure is--it's wrong. And so we've worked closely with 
Senator McCain. The House needs to deal with this, and we will 
next week.'' (Boehner Press Conference, 3/30/06)
    Rep. John Boehner: ``The 527s were created out of the 
bipartisan campaign finance reform, something that many of us 
foresaw, that we were pushing money out of a regulated system 
into an unregulated system. You know, most people wanted to get 
rid of soft money because they didn't think it was regulated, 
even though soft money had to be disclosed in terms of who gave 
it, what amounts, and how you spent it--and there were rules 
around how you could spend it. And when you look at what 
happened after campaign reform passed, these 527 organizations 
erupted. There is no disclosure of where their money comes from 
or how they spend it or what they do with it. And they're 
spending hundreds of millions of dollars trying to influence 
federal elections. And I believe that these organizations ought 
to be covered under the same kind of regulations that govern 
political parties.'' (Boehner Remarks, 3/16/06)
    Rep. Vern Ehlers: ``Republican Vernon J. Ehlers of 
Michigan, called 527s ``a curse to the political process'' that 
lacks accountability.'' (Congressional Quarterly, 6/29/05)
    Rep. Eric Cantor: ``Anything that moves us back towards 
that notion of transparency and real-time reporting of 
donations and contributions I think would be a helpful move 
towards restoring confidence of voters.'' (Newsweek, SCOTUS 
Ruling Spells Disaster for Political Transparency, 01/21/2010)
    Sen. Lamar Alexander: ``I support campaign finance reform, 
but to me that means individual contributions, free speech and 
full disclosure. In other words, any individual can give 
whatever they want as long as it is disclosed every day on the 
Internet. Otherwise, you restrict free speech and favor super-
rich candidates--candidates with famous names, the media and 
special interest groups, all of whom can spend unlimited 
money.'' (Washington Post, Presidential Candidate Lamar 
Alexander, 05/19/1999)
    Sen. John Cornyn: ``I think the system needs more 
transparency, so people can more easily reach their own 
conclusions.'' (McClatchy, What do both parties have in common? 
Wall Street donations, 04/25/2010)
    Sen. John McCain: ``This is not a partisan issue. It should 
not advantage one party over the other. What reform does is 
create transparency, equality, and participation, and inspire 
confidence in those we represent. The strength and real muscle 
in this fight lies with the American people. During the long 
battle in the Senate to pass campaign finance reform, we called 
on the American public to make their voices heard on Capitol 
Hill. They answered, and the impact was astounding.'' 
(Congressional Record, Speech on Bipartisan Campaign Reform 
Act, 02/04/2004)
    Sen. Susan Collins: ``Sen. Collins . . . believes that it 
is important that any future campaign finance laws include 
strong transparency provisions so the American public knows who 
is contributing to a candidate's campaign, as well as who is 
funding communications in support of or in opposition to a 
political candidate or issue.'' (The Hill, GOP senators avoid 
co-sponsoring campaign finance reform legislation, 04/20/2010)
    Sen. Jeff Sessions: ``I don't like it when a large source 
of money is out there funding ads and is unaccountable . . . To 
the extent we can, I tend to favor disclosure.'' (The Hill, 
Campaign finance bill has GOP wary, 04/22/2010)
    Sen. Thad Cochran: ``We are Senators with varying political 
views, but we agree that the public has a right to expect 
electronic filing and online disclosure of campaign finance 
records.'' (Roll Call, Four Senators Urge Expansion of 
Mandatory Electronic Filing, 09/12/2009)
    Rep. Kevin McCarthy: ``The best way, the fairest way, is 
greater transparency. Let people understand where it is going 
and what's happening.'' (Newsweek, SCOTUS Ruling Spells 
Disaster for Political Transparency, 01/21/2010)
    Rep. Fred Upton: ``But advocates of full disclosure say the 
groups skirt the law with barely concealed electioneering, such 
as messages that encourage viewers to call a certain lawmaker 
if they agree with the group's views. `It's a gigantic loophole 
that needs to be closed,' said Rep. Fred Upton, R-Mich., a 
moderate who supports campaign finance reform.'' (Newport News 
Daily Press, 6/10/00)
    Rep. David Dreier: ``Well, let me just say at the outset, 
Ray, that I, I agree with him that we need to move ahead with 
campaign finance reform. I'm one who wants to empower the 
voters and have greater disclosure, that's really my priority 
when it comes to campaign finance reform.'' (NPR, 1/6/97)
    Rep. David Dreier: ``Well, the fact of the matter is George 
Bush has, in fact, reformed. He's reformed frivolous lawsuits, 
he's reformed education, he's reformed taxes, he's reformed 
patient protection. He's done all that as the governor of 
Texas. Now, there has not been a lot of attention focused on 
it, but that's something to which we can all look and be 
extremely proud. On the issue of campaign finance reform, he's 
been out there arguing vigorously for full disclosure. He wants 
to make sure that we have parity established, if we eliminate 
soft money for both unions and businesses. And so, Yes, he's 
been reforming. He's been doing it and he's got proposals for 
when he gets to the White House that he wants us to move.'' 
(MSNBC, 2/15/00)
                                ------                                


Annenberg Public Policy Center Calculates Dollars Spent by Four Highest 
Spending Third Party Groups on Deceptive TV Ads Attacking or Supporting 
                   Republican Presidential Contenders

For Immediate Release: April 27, 2012
Contact: Kathleen Hall Jamieson at info@flackcheck.org or 215-898-9400
    Drawing on spending estimates from Kantar Media CMAG and 
the fact checking of FactCheck.org, the Annenberg Public Policy 
Center has created a dollars in deception measure (DDs) 
calculating dollars spent on televised presidential third party 
ads by the groups calling themselves ``The Red White and Blue 
Fund,'' ``Winning Our Future,''``Restore Our Future,'' and the 
American Federation of State, County and Municipal Employees 
(AFSCME).
    From Iowa through Wisconsin, 23.3 million (56.7%) of the 
41.1 million dollars were spent on 19 ads containing deceptive 
or misleading claims.
    Most of the dollars in deception (an estimated $20.8 
million) were aired by the pro-Romney super PAC ``Restore Our 
Future'' (estimated 8.8 million DDs--dollars in deception--
attacking former House Speaker Newt Gingrich, an estimated 9.4 
million DDs attacking former Pennsylvania Senator Rick 
Santorum, and an estimated 2.6 million in DDs making the case 
for the election of former Massachusetts governor Mitt Romney).
    ``Restore Our Future'' outspent the pro-Gingrich and pro-
Santorum super PACs by 20 to 1. 
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>

                    The pro-Gingrich super PAC ``Winning Our 
                Future'' an estimated $917,670
                    The pro-Democratic labor union American 
                Federation of State, County and Municipal 
                Employees an estimated $846,380
    ``Restore Our Future'' spent DDs against Gingrich and 
Santorum on such deceptions as:
          
 ``Gingrich not only teamed up with Nancy 
        Pelosi on global warming, but together they co-
        sponsored a bill that gave $60 million a year to a U.N. 
        program supporting China's brutal `One Child' policy.'' 
        (est. $2,394,813)
          
 Two versions of a claim against Santorum:
                    ``Santorum voted to let convicted felons 
                vote.'' Ad shows visual of men walking in 
                orange prison jumpsuits, suggesting felons 
                currently serving their time would be allowed 
                to vote. (est. $4,849,010)
                    ``With your values, how would you have 
                voted? Would you have voted to let convicted 
                violent felons regain the right to vote? Rick 
                Santorum voted `yes,' joining Hillary 
                Clinton.'' Ad shows visual of men walking in 
                orange prison jumpsuits, suggesting felons 
                currently serving their time would be allowed 
                to vote. (est. $3,879,830)
    The pro-Santorum super PAC ``Red White and Blue Fund'' made 
this deceptive claim:
          
 ``Romney left Massachusetts $1 billion in 
        debt.'' (est. $603,140)
    The pro-Gingrich super PAC Winning Our Future made the 
following deceptive claim against Romney:
          
 ``Romneycare costs spiraled out of control, 
        hiking premiums squeezing household budgets.'' (est. 
        $412,530)
    The amounts spent on television ads advancing the deceptive 
claims (when multiple misleading claims appeared in the same 
ad, the total spent airing the ad is apportioned by claim):
          
 ``While Romney was a director at the Damon 
        Corporation, the company was defrauding Medicare of 
        millions.'' Ad shows visual of Mitt Romney morphing 
        into Florida Governor Rick Scott, who was accused of 
        Medicare fraud, while Romney was not, with text and 
        voiceover saying: ``Corporate Greed, Medicare Fraud. 
        Sound Familiar?'' (AFSCME, est. $423,190)
          
 ``The company was fined $100 million, but 
        Romney, himself, made a fortune.'' Ad shows visual of 
        Mitt Romney morphing into Florida Governor Rick Scott, 
        who was accused of Medicare fraud, while Romney was 
        not, with text and voiceover saying: ``Corporate Greed, 
        Medicare Fraud. Sound Familiar?'' (AFSCME, est. 
        $423,190)
          
 ``Romney supervised a company guilty of 
        massive Medicare fraud'' Visual in ad called ``Blood 
        Money'' pastes the text, ``ILLEGAL ACTIVITY . . . UNDER 
        ROMNEY'S NOSE.'' A shorter version of the ad pastes the 
        text, ``Company (in small print) GUILTY OF MASSIVE 
        MEDICARE FRAUD (in large, bold print)'' over Romney's 
        face, and pastes the text, ``ILLEGAL ACTIVITY'' over an 
        image of Romney. (``Winning Our Future,'' est. 
        $325,980)
          
 ``Romney left Massachusetts $1 billion in 
        debt.'' (``Red White and Blue Fund,'' est. $603,140)
          
 ``Meet the Real Mitt Romney: Supported the 
        Wall Street Bailout, putting Americans trillions in 
        debt'' (``Red White and Blue Fund,'' est. $81,910)
          
 ``Romneycare costs spiraled out of control 
        hiking premiums, squeezing household budgets'' 
        (``Winning Our Future,'' est. $412,530)
          
 ``[Romney] thinks judges can overrule 
        parents on abortions.'' (``Winning Our Future,'' est. 
        $179,160)
          
 ``Gingrich not only teamed up with Nancy 
        Pelosi on global warming, but together they co-
        sponsored a bill that gave $60 million a year to a U.N. 
        program supporting China's brutal One Child' policy.'' 
        (``Restore Our Future,'' est. $2,394,813)
          
 ``Newt was fined $300,000 for ethics 
        violations'' (``Restore Our Future,'' est. $2,440,769)
          
 ``Gingrich took $1.6 million dollars from 
        Freddie Mac just before it helped cause the economic 
        meltdown'' (``Restore Our Future,'' est. $2,211,690)
          
 ``With your values, how would you have 
        voted? Would you have voted to let convicted violent 
        felons regain the right to vote? Rick Santorum voted 
        yes,' joining Hillary Clinton.'' Ad shows visual of men 
        walking in orange prison jumpsuits, suggesting felons 
        currently serving their time would be allowed to vote. 
        (``Restore Our Future,'' est. $3,879,830)
          
 ``Santorum voted to let convicted felons 
        vote.'' Ad shows visual of men walking in orange prison 
        jumpsuits, suggesting felons currently serving their 
        time would be allowed to vote. (``Restore Our Future,'' 
        est. $4,849,010)
          
 ``While Newt was speaker, earmarks 
        exploded.'' Ad shows on-screen text: ``While Newt Was 
        Speaker, Earmarks Nearly Doubled To $14.5 Billion.'' 
        Fact checking found this figure to be inaccurate. 
        (``Restore Our Future,'' est. $1,255,480)
          
 ``As speaker, Gingrich supported tax payer 
        funding of some abortions.'' (``Restore Our Future,'' 
        est. $152,237)
          
 ``On the economy, Rick Santorum says, I 
        don't care what the unemployment rate's gonna be.''' 
        (``Restore Our Future,'' est. $696,990)
          
 ``Freddie Mac helped cause the economic 
        collapse, but Gingrich cashed in. Freddie Mac paid Newt 
        $30,000 an hour, $1.6 million.'' (``Restore Our 
        Future,'' est. $325,583)
          
 ``[Romney] turned a deficit into a surplus 
        without raising taxes.'' (``Restore Our Future,'' est. 
        $2,486,785)
          
 ``[Mitt Romney] took over a state facing 
        huge deficits, and he turned it around without raising 
        taxes, vetoing hundreds of bills.'' (``Restore Our 
        Future,'' est. $154,765)
    To see a video release illustrating these findings and an 
analysis of what is deceptive about each of these claims, click 
here to go to FlackCheck.org's ``Stand by Your Ad'' deception 
log. 
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>

        High Percent of Presidential Ad Dollars of Top Four 501(c)(4)s 
         Backed Ads Containing Deception, Annenberg Study Finds

For Immediate Release: June 20, 2012
Contact: Kathleen Hall Jamieson at 215-898-9400
    An analysis by the Annenberg Public Policy Center conducted 
for the Center for Responsive Politics found that from December 
1, 2011 through June 1, 2012, 85% of the dollars spent on 
presidential ads by four top-spending third-party groups known 
as 501(c)(4)s were spent on ads containing at least one claim 
ruled deceptive by fact- checkers at FactCheck.org, 
PolitiFact.com, the Fact Checker at the Washington Post or the 
Associated Press.
    Under IRS rules, a 501(c)(4) operates ``only to promote 
social welfare to benefit the community.'' As long as it is 
organized primarily to promote the community's general welfare, 
it may lobby for legislation and participate in political 
campaigns.
    These groups don't have to disclose their donors.
    From December 1, 2011 through June 1, 2012, the four top 
presidential campaign- spending 501(c)(4)s spent an estimated 
$24.9 million\1\ ($24,916,690) of their $29.3 million 
($29,320,110) presidential ad dollars on ads containing 
deceptions.
---------------------------------------------------------------------------
    \1\All monetary figures are estimates provided by Kantar Media 
CMAG, 12/1/2011 through 
6/1/2012.
 <GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>

    The claims\2\ ruled deceptive by the fact-checkers 
included:
---------------------------------------------------------------------------
    \2\Dollars spent per deceptive claim is calculated by dividing the 
total dollars spent on the ad by the number of deceptive claims in the 
ad, so when multiple deceptive claims appeared in the same ad, the 
total spent airing the ad is apportioned by claim.
---------------------------------------------------------------------------
          
 ``Obama personally lobbied to kill a 
        pipeline bringing oil from Canada'' (Est. $191,490 
        spent on claim)--Crossroads GPS
          
 ``Obama opposed exploring for energy in 
        Alaska'' (Est. $1,634,500 spent on claim)--American 
        Energy Alliance
          
 ``The stimulus bill sent tens of millions of 
        dollars to build traffic lights in China'' (Est. 
        $2,509,000 spent on claim)--Americans for Prosperity
          
 ``Obama's White House is full of Wall Street 
        executives.'' (To support this claim, the viewer is 
        shown photos of seven people. But one never worked as 
        an investment banker (Geithner); two have resumes that 
        fall far short of being ``Wall Street executives'' 
        (Rahm Emanuel and Louis Caldera); and one was not part 
        of the White House (Jon Corzine). While the ad's 
        narrator focuses on these seven ``Wall Street 
        executives,'' 27 names scroll up the screen under the 
        header of ``Obama's Wall Street Inner Circle.'' 
        FactCheck.org found 14 of those names don't belong on 
        the list.) (Est. $2,647,445 spent on claim)--American 
        Future Fund
    To see other deceptive claims by these 501(c)(4) groups as 
well as evaluations of them by the major fact-checking groups, 
go to the FlackCheck.org Deception Log.
    A study released by APPC in April found that from the Iowa 
Caucus through the Wisconsin primary 56.7 percent of the 
dollars spent by the four top-spending third-party groups 
(three super PACs and AFSCME) on presidential campaign ads was 
spent on ads containing at least one deception.
    ``Across the history of campaign communication, third-party 
ads have been both more attack-driven and more deceptive than 
candidate-sponsored ones,'' noted APPC Director Kathleen Hall 
Jamieson at the Center for Responsive Politics' ``Shadow 
Money'' seminar at the National Press Club today. 
``Unsurprisingly, our 2012 APPC studies of third-party 
deception confirm that as the level of donor disclosure drops, 
the level of duplicity rises. This year, presidential super PAC 
ads are more deceptive than those sponsored by presidential 
candidates and C4 presidential ads more duplicitous than super 
PAC ones.''
                                ------                                


                 [From the Brennan Center for Justice]


         National Survey: Super PACs, Corruption, and Democracy


   AMERICANS' ATTITUDES ABOUT THE INFLUENCE OF SUPER PAC SPENDING ON 
           GOVERNMENT AND THE IMPLICATIONS FOR OUR DEMOCRACY

                                SUMMARY

    A recent national survey conducted on behalf of the Brennan 
Center for Justice at NYU School of Law demonstrates that the 
spending of Super PACs in this year's election cycle has given 
rise to a large, bipartisan consensus that such outsized 
spending is dangerous for our democracy. Historical polling has 
repeatedly shown that Americans believe elected officials favor 
the interests of large contributors to their own campaign war-
chests. This new poll reveals for the first time that Americans 
have similar fears of elected officials favoring big donors to 
nominally independent Super PACs--and also that many are less 
likely to vote because of Super PAC spending.
    From April 12-15, 2012, the independent Opinion Research 
Corporation conducted a national telephone survey of 1,015 
adults living in the continental United States.\1\ A summary of 
responses to each polling question is provided below. A 
detailed Appendix, including the poll's script, methodology, 
and responses broken down by demographics, is available on the 
Brennan Center's website at http://www.brennancenter.org/
Super_PAC_Poll_Appendix.
    The poll reveals that nearly 70 percent of Americans 
believe Super PAC spending will lead to corruption and that 
three in four Americans believe limiting how much corporations, 
unions, and individuals can donate to Super PACs would curb 
corruption. Of those who expressed an opinion, more than 80 
percent believe that, compared with past elections, the money 
being spent by political groups this year is more likely to 
lead to corruption. And, most alarmingly, the poll revealed 
that concerns about the influence Super PACs have over elected 
officials undermine Americans' faith in democracy: one in four 
respondents--and even larger numbers of low-income people, 
African Americans, and Latinos--reported that they are less 
likely to vote because big donors to Super PACs have so much 
more sway than average Americans.

  SUPER PAC SPENDING HAS PRODUCED WIDESPREAD PERCEPTIONS OF CORRUPTION

    By significant margins, Americans believe new rules that 
allow individuals, corporations, and unions to donate unlimited 
amounts to Super PACs will lead to corruption. These beliefs 
are held equally by both Republicans and Democrats.
      
 69% of respondents agreed that ``new rules that 
let corporations, unions and people give unlimited money to 
Super PACs will lead to corruption.'' Only 15% disagreed.\2\ 
Notably, 74% of Republicans and 73% of Democrats agreed with 
this statement.\3\
      
 73% of respondents agreed that ``there would be 
less corruption if there were limits on how much could be given 
to Super PACs.'' Only 14% disagreed. Here, 75% of Republicans 
and 78% of Democrats agreed.
      
 Only about 1 in 5 Americans agree that average 
voters have the same access to candidates (and influence on 
candidates) as big donors to Super PACs. Two-thirds of 
Americans disagree.

OF THOSE EXPRESSING AN OPINION, MORE THAN FOUR IN FIVE BELIEVE SPENDING 
      IN THIS ELECTION CYCLE IS MORE LIKELY TO LEAD TO CORRUPTION

      
 Half of respondents--and 85% of those expressing 
an opinion--agreed that spending in this election is more 
likely to lead to corruption than in previous elections. Only 
9% of respondents thought that, compared to previous elections, 
it was less likely that the money spent by political groups in 
this election will lead to corruption. Republicans (51%) and 
Democrats (54%) both agreed that spending in this election is 
more likely to lead to corruption.

    BROAD BIPARTISAN MAJORITIES BELIEVE ELECTED OFFICIALS FAVOR THE 
         INTERESTS OF SUPER PAC DONORS OVER THE PUBLIC INTEREST

    Large majorities of Americans believe that members of 
Congress will favor the interests of those who donate to Super 
PACs over those who do not--and that Super PAC donors can 
pressure elected officials to alter their votes.
      
 More than two-thirds of all respondents (68%)--
including 71% of Democrats and Republicans--agreed that a 
company that spent $100,000 to help elect a member of Congress 
could successfully pressure him or her to change a vote on 
proposed legislation. Only one in five respondents disagreed.
      
 More than three-quarters of all respondents--
77%--agreed that members of Congress are more likely to act in 
the interest of a group that spent millions to elect them than 
to act in the public interest. Similar numbers of Republicans 
(81%) and Democrats (79%) agreed. Only 10% disagreed.

THE PERCEPTION THAT SUPER PACS HAVE EXCESSIVE INFLUENCE OVER GOVERNMENT 
        THREATENS GRAVE CONSEQUENCES FOR PARTICIPATORY DEMOCRACY

    An alarming number of Americans report that their concerns 
about the influence of donors to outside political groups make 
them less likely to engage in democracy. Communities of color, 
those with lower incomes, and individuals with less formal 
education are more likely to disengage due to concerns about 
how much influence is wielded by Super PAC donors.
    
 Two in three Americans--65%--say that they trust 
government less because big donors to Super PACs have more 
influence than regular voters. Republicans (67%) and Democrats 
(69%) uniformly agree.
    
 One in four Americans--26%--say that they are less 
likely to vote because big donors to Super PACs have so much 
more influence over elected officials than average Americans.
            Less wealthy and less educated Americans were 
        significantly more likely to say they would be less 
        likely to vote because of Super PAC influence: 34% of 
        respondents with no more than a high school education, 
        and 34% of those in households with an annual income 
        less than $35,000, said they would be less likely to 
        vote.\4\
            A higher number of African-American and Hispanic 
        voters also stated that the disproportionate influence 
        of Super PAC donors will discourage them from voting: 
        29% of African Americans and 34% of Hispanics said they 
        were less likely to vote because of Super PAC 
        influence.\5\
    
 41% of respondents--including 49% of those who 
have no more than a high school education and 48% of those with 
household incomes under $35,000--believe that their votes don't 
matter very much because big donors to Super PACs have so much 
more influence.\6\

                                ENDNOTES

    \1\The survey included 764 landline interviews and 251 cell 
phone interviews, and was weighted to account for geographic, 
demographic, and socioeconomic underrepresentation.
    \2\Unless otherwise indicated, the margin of error for 
reported survey results is 3.1%.
    \3\The margin of error for all reported results for 
Republicans is 4.9%, and the margin of error for all reported 
results for Democrats is 4.6%. Smaller numbers of independent 
voters agreed with the statements in the survey; this was 
largely because independent voters were more likely to report 
having no feeling about whether they agreed or disagreed.
    \4\The margin of error for all reported results for those 
with a high school education or less is 5.1%, and the margin of 
error for all reported results for those with household incomes 
less than $35,000 is 5.3%.
    \5\The margins of error for this particular result for 
African-Americans and Hispanics are 9.6% and 13.0%, 
respectively. Because of low sample sizes, we were not able to 
conclude that these results were statistically significant.
    \6\Respondents with a high school education or less, and 
respondents with household incomes under $35,000, were 
significantly more likely to believe that their votes don't 
matter very much because big donors to Super PACs have so much 
more influence.
                                ------                                --
--------


  (Order List: 565 U.S.), Friday, February 17, 2012, Order in Pending 
                                  Case


11A762: AMERICAN TRADITION PARTNERSHIP, INC., ET AL. V. BULLOCK, ATT'Y 
                           GEN. OF MT, ET AL.

    The application for stay presented to Justice Kennedy and 
by him referred to the Court is granted, and the Montana 
Supreme Court's December 30, 2011, decision in case No. DA 11-
0081, is stayed pending the timely filing and disposition of a 
petition for a writ of certiorari. Should the petition for a 
writ of certiorari be denied, this stay shall terminate 
automatically. In the event the petition for a writ of 
certiorari is granted, the stay shall terminate upon the 
issuance of the mandate of this Court.
    Statement of Justice Ginsburg, with whom Justice Breyer 
joins, respecting the grant of the application for stay.
    Montana's experience, and experience elsewhere since this 
Court's decision in Citizens United v. Federal Election Comm'n, 
558 U.S. __ (2010), make it exceedingly difficult to maintain 
that independent expenditures by corporations ``do not give 
rise to corruption or the appearance of corruption.'' Id., at 
__ (slip op., at 42). A petition for certiorari will give the 
Court an opportunity to consider whether, in light of the huge 
sums currently deployed to buy candidates' allegiance, Citizens 
United should continue to hold sway. Because lower courts are 
bound to follow this Court's decisions until they are withdrawn 
or modified, however, Rodriguez de Quijas v. Shearson/American 
Express, Inc., 490 U.S. 477, 484 (1989), I vote to grant the 
stay.

                      Cite as: 567 U.S. __ (2012)

                               Per Curiam

                   SUPREME COURT OF THE UNITED STATES


      American Tradition Partnership, Inc., FKA Western Tradition 
    Partnership, Inc., et al. v. Steve Bullock, Attorney General of 
                            Montana, et al.


   ON PETITION FOR WRIT OF CERTIORARI TO THE SUPREME COURT OF MONTANA

                   No. 11-1179. Decided June 25, 2012

Per Curiam.

    A Montana state law provides that a ``corporation may not 
make . . . an expenditure in connection with a candidate or a 
political committee that supports or opposes a candidate or a 
political party.'' Mont. Code Ann. 13-35-227(1) (2011). The 
Montana Supreme Court rejected petitioners' claim that this 
statute violates the First Amendment. 2011 MT 328, 363 Mont. 
220, 271 P. 3d 1. In Citizens United v. Federal Election 
Commission, this Court struck down a similar federal law, 
holding that ``political speech does not lose First Amendment 
protection simply because its source is a corporation.'' 558 
U.S. ___, ___ (2010) (slip op., at 26) (internal quotation 
marks omitted). The question presented in this case is whether 
the holding of Citizens United applies to the Montana state 
law. There can be no serious doubt that it does. See U.S. 
Const., Art. VI, cl. 2. Montana's arguments in support of the 
judgment below either were already rejected in Citizens United, 
or fail to meaningfully distinguish that case.
    The petition for certiorari is granted. The judgment of the 
Supreme Court of Montana is reversed.
    It is so ordered.

                   Cite as: 567 U. S. -------- (2012)

                         Breyer, J., dissenting

                   SUPREME COURT OF THE UNITED STATES


      American Tradition Partnership, Inc., FKA Western Tradition 
    Partnership, Inc., et al. v. Steve Bullock, Attorney General of 
                            Montana, et al.


   ON PETITION FOR WRIT OF CERTIORARI TO THE SUPREME COURT OF MONTANA

                   No. 11-1179. Decided June 25, 2012

JUSTICE BREYER, with whom JUSTICE GINSBURG, JUSTICE SOTOMAYOR, and 
        JUSTICE KAGAN join, dissenting.

    In Citizens United v. Federal Election Commission, the 
Court concluded that ``independent expenditures, including 
those made by corporations, do not give rise to corruption or 
the appearance of corruption.'' 558 U.S. ___, ___ (2010) (slip 
op., at 42). I disagree with the Court's holding for the 
reasons expressed in Justice Stevens' dissent in that case. As 
Justice Stevens explained, ``technically independent 
expenditures can be corrupting in much the same way as direct 
contributions.'' Id., at ___ (slip op., at 67-68). Indeed, 
Justice Stevens recounted a ``substantial body of evidence'' 
suggesting that ``[m]any corporate independent expenditures . . 
. had become essentially interchangeable with direct 
contributions in their capacity to generate quid pro quo 
arrangements.'' Id., at ___ (slip op., at 64-65).
    Moreover, even if I were to accept Citizens United, this 
Court's legal conclusion should not bar the Montana Supreme 
Court's finding, made on the record before it, that independent 
expenditures by corporations did in fact lead to corruption or 
the appearance of corruption in Montana. Given the history and 
political landscape in Montana, that court concluded that the 
State had a compelling interest in limiting independent 
expenditures by corporations. 2011 MT 328, para.para.36-37, 363 
Mont. 220, 235-236, 271 P. 3d 1, 36-37. Thus, Montana's 
experience, like considerable experience elsewhere since the 
Court's decision in Citizens United, casts grave doubt on the 
Court's supposition that independent expenditures do not 
corrupt or appear to do so.
    Were the matter up to me, I would vote to grant the 
petition for certiorari in order to reconsider Citizens United 
or, at least, its application in this case. But given the 
Court's per curiam disposition, I do not see a significant 
possibility of reconsideration. Consequently, I vote instead to 
deny the petition.



CONGRESSIONAL FORUM: THE MOST EXPENSIVE SEAT IN THE HOUSE: THE STATE OF 
                      OUR CAMPAIGN FINANCE SYSTEM

                              ----------                              


                       WEDNESDAY, APRIL 18, 2012

                                                    Washington, DC.
    The forum met at 1:59 p.m., in Room 1310, Longworth House 
Office Building, Hon. Charles A. Gonzalez, presiding.
    Present: Representatives Gonzalez, Pelosi, Brady of 
Pennsylvania, Price of North Carolina, Ellison, Van Hollen, and 
Capuano.
    Mr. Gonzalez. Good afternoon, everybody. We will start off 
with an apology. But, obviously, we had votes, and that is 
always the first order of business.
    At this time, I want to call this forum to order, and I 
would like to begin by thanking House Administration Chairman 
Dan Lungren for allowing us to use the committee room.
    The past 2 years since the Supreme Court's decision in 
Citizens United have seen a revolution in campaign finance 
laws, and it is time that we looked into it. Even before 
Citizens, the Jack Abramoff scandal and others showed how 
corruption damages our nation.
    But even the appearance of corruption is destructive. 
Seventy-five percent of Americans believe campaign 
contributions buy results in Congress. That is a threat to our 
democracy itself.
    We have waited 15 months for the committee of jurisdiction 
to hold hearings. We can't wait any longer. I am only sorry 
this is the first discussion the House has held on this 
subject, and the only hope is to see official hearings some 
day. But we will do what we can to bring light to the issue.
    Since Citizens United, we have entered a different world. 
As we see on Chart 1, outside spending in campaigns has 
drastically increased. The spending on the most expensive 
campaign for the House of Representatives rose from $1.7 
million in 1990 to $11.7 million in 2010.
    Spending by groups that don't disclose their donors 
increased from 1 percent to 47 percent, Chart 2, as you can 
see. Part of this has been facilitated by this new invention 
referred to as the ``Super PAC.'' And we will have a clip on 
what, in essence, is a Super PAC.
    [Video shown.]
          Ted Koppel. [What is the difference] between a PAC 
        and a Super PAC?
          Stephen Colbert. Well, it gets technical but, without 
        going into too much detail, one of them has the word 
        ``Super'' in front of it and that makes it a Super PAC. 
        Other than that, as far as I can tell, the difference 
        between a PAC and a Super PAC is a cover letter. 
        Because I formed a PAC but a PAC can only take so much 
        money, it can only spend so much money and I wanted to 
        spend unlimited amounts of money and receive, more 
        importantly, unlimited amounts of money. And so my 
        lawyer told me all I had to do is add a cover letter 
        that said `I intend this to be a Super PAC,' and it was 
        a Super PAC.
          Ted Koppel. So now you can take all the money that 
        people are unwise enough to send you?
          Stephen Colbert. Any amount. Did you bring your 
        checkbook?
          Ted Koppel. Of course. How much money have you 
        collected so far?
          Stephen Colbert. Oh, the fun thing about that is I 
        don't have to tell you.
    [End video]
    Mr. Gonzalez. What was the Supreme Court thinking? The 
justices were fully aware of the threat that is posed by 
political contributions to judges who run for judicial posts, 
but they saw no such threat to the legislative branch. And we 
know that Justice Scalia laughed at the idea that people who 
sign political petitions should remain anonymous because, as he 
said at oral argument, ``The fact [is] that running a democracy 
takes a certain amount of civic courage, and the First 
Amendment does not protect you from criticism or even nasty 
phone calls when you exercise your political rights to 
legislate or to take part in the legislative process.''
    In his concurring opinion in that case, Justice Scalia was 
even more blunt. ``Requiring people to stand up in public for 
their political acts fosters civic courage without which 
democracy is doomed.'' Yet an individual or a corporation can 
remain anonymous when making a monetary contribution.
    And we should also have a clip here on how that can be done 
and effectuated.
    [Video shown.]
          Stephen Colbert. Ok, so now I can get corporate 
        individual donations of unlimited amount for my (c)(4). 
        What can I do with that money?
          Trevor Potter. Well, that (c)(4) could take out 
        political ads and attack candidates or promote your 
        favorite ones as long as it's not the principal purpose 
        for spending its money.
          Stephen Colbert. No, my principle purpose is an 
        educational entity. Right?
          Trevor Potter. There you go.
          Stephen Colbert. I want to educate the public that 
        gay people cause earthquakes.
          Trevor Potter. There are probably some (c)(4)s doing 
        that.
          Stephen Colbert. Ok, can I take my (c)(4) money and 
        then donate it to my Super PAC?
          Trevor Potter. You can.
          Stephen Colbert. Wait, wait. Super PACs are 
        transparent!
          Trevor Potter. Right.
          Stephen Colbert. And the (c)(4) is secret. So I can 
        take secret donations of my (c)(4) and give it to my 
        supposedly transparent Super PAC?
          Trevor Potter. And it'll say, Given by your (c)(4).
          Stephen Colbert. What is the difference between that 
        and money laundering?
          Trevor Potter. It's hard to say.
          Stephen Colbert. Well, Trevor, thank you so much for 
        setting me up.
    [End video]
    Mr. Gonzalez. Now, Mr. Colbert may be using satire, but his 
point is very real. Phony corporations have been set up to 
disguise donations. W Spann LLC gave $1 million to the Super 
PAC, Restore Our Future, and only investigative journalism and 
the donor's embarrassment revealed the millionaire behind the 
money. There are criminal probes into other such donations, but 
some are completely legal.
    It used to be that every politician, whatever else they 
thought about campaign finance reform in general, was for 
disclosure. There is a list of old quotes on the press table 
that are available to those that want to see those previous 
positions taken by the same individuals that would oppose 
DISCLOSE today. All that, of course, has changed, as I just 
mentioned.
    Even some of the biggest donors to super PACs are opposed 
to the idea of unlimited donations. One prominent contributor, 
whose family has contributed more than $15 million to a Super 
PAC, said, ``I'm against very wealthy people attempting to or 
influencing elections. But as long as it is doable, I am going 
to do it.''
    I am sorry that none of the major Super PAC donors accepted 
my invitation to testify today, but we do have four panelists 
here today that are very familiar with the subject and some 
very articulate Members of Congress that are supporting that 
which we can do in the way of disclosure.
    I will begin by recognizing the distinguished Democratic 
leader Nancy Pelosi for an opening statement.
    Ms. Pelosi. Thank you very much, Ranking Member Gonzalez, 
for your leadership in bringing us here today on this important 
issue, so important that it is fundamental to our great 
democracy.
    I am honored to be here with you and with our ranking 
member of the full committee, Congressman Brady, and our other 
colleagues: Congressman Chris Van Hollen, author of the 
DISCLOSE Act; with David Price, a respected Member of Congress, 
who brings academic as well as governmental credentials to this 
discussion; Keith Ellison, Congressman Keith Ellison, who is 
working at the grassroots level to try to offset some of the 
cynicism that is growing regarding the use of money in 
campaigns; and Congressman Capuano, a respected member of this 
committee who has worked hard on this issue.
    It is important because our Founders had intended that we 
were a democracy, which meant we are a government of the people 
and that the votes and the voices of the people would determine 
the outcomes of elections, not the bank books of a very few 
people.
    Nearly a century ago, Supreme Court Justice Louis Brandeis 
wrote about the dangers of corporate interests dominating our 
economy, stifling competition, and harming our Nation. And he 
reminded us in the face of these forces that, ``Sunlight is 
said to be the best of disinfectants.'' We agree.
    Today, we come together in that same tradition to shed 
sunlight on our democratic process and preserve the integrity 
of our elections, our democracy, to call on our colleagues to 
protect the voices and the votes of the American people. Our 
effort today is necessary because more than 2 years ago, with 
the Citizens United decision, the Supreme Court opened the 
floodgates of uninhibited special interest spending; secret, 
undisclosed spending in our elections; and unlimited corporate 
influence over our public policy debate.
    In response to the Citizens United ruling, Democrats have 
worked to restore transparency, fairness, and accountability to 
our political process. We have worked to create what we believe 
is necessary, a new politics free from special interest and big 
money.
    It is with that goal in mind that today we have come 
together for a forum--thank you, Mr. Ranking Member Gonzalez 
and Mr. Brady--for a forum called ``The Most Expensive Seat in 
the House: The State of our Campaign Finance System.''
    While I appreciate the recognition that Ranking Member 
Gonzalez made to the chairman, who gave us permission to use 
the room, I think it is really necessary to say if you need any 
more argument about the need for openness, you only need look 
to the fact that the chairman denied us the ability to use the 
cameras, the room's built-in cameras so that we can transmit 
what is happening here more fully.
    In fact, the Republican majority has denied us hearings on 
legislation called the DISCLOSE Act, which would require 
corporations to report their campaign-related activities and, 
as Mr. Van Hollen leads us in saying, calling upon them to 
stand by their ads the same way candidates must do.
    Already 160 Members have cosponsored this legislation, and 
I hasten to add that our Mr. Brady, when he was chairman, 
enabled the Republicans in the minority to have at least three 
hearings at their request. We hope that the Republican majority 
will enable this to be a full-fledged hearing. They won't let 
this proceeding be called a hearing, so it is a forum.
    This legislation, the DISCLOSE Act, passed the House in 
2010 with bipartisan support only to be blocked in the Senate 
by the Republicans. We must fight for full disclosure to get 
unlimited secret donations out of our politics. We must fight 
for reform to empower small donors and the grassroots to have a 
greater role in our elections, and I contend that when we 
reduce the role of money in politics--and not just Citizens 
United, but all big money in politics--we will increase the 
number of women, minorities, and young people in elective 
office. It will have a very wholesome impact on our system.
    Ultimately, we must fight to amend our Constitution to 
overturn the Supreme Court decision that had strengthened the 
hands of the special interest at the expense of the people's 
interest. So I am very honored to join my colleagues in 
welcoming this very distinguished panel to our forum today.
    Norman Ornstein of the American Enterprise Institute; Paul 
Ryan, FEC Program Director; Zephyr--like the wind--Teachout, 
Professor, Fordham University School of Law; and Monica Youn, 
Brennan Center Constitutional Fellow. They will be more 
appropriately introduced.
    But today's forum, this effort is about nothing less than 
our democracy. The votes of the many must determine the outcome 
of elections, not the bankroll of the very privileged few.
    With that, Mr. Chairman, I once again commend you for 
holding this forum and salute you for your leadership on this 
subject.
    Mr. Gonzalez. Madam Leader, thank you. Thank you for your 
leadership and your participation today.
    To the witnesses, you will be given 5 minutes to make your 
oral remarks. If you submit anything in writing, please 
understand that will become part of the record, and you can 
supplement that, of course. But we are going to try to keep it 
to 5 minutes, and then we will have Q&A and maybe even a second 
round of Q&A.
    Our first witness is Norman J. Ornstein, who received his 
B.A. from the University of Minnesota and a Master's and a 
Ph.D. in political science from the University of Michigan. Dr. 
Ornstein is a longtime observer of Congress and politics. He 
writes a weekly column for Roll Call and is an election analyst 
for CBS News.
    He served as coordinator of the American Enterprise 
Institute-Brookings Election Reform Project and participates in 
AEI's Election Watch series. He also serves as a senior 
counselor to the Continuity of Government Commission. Mr. 
Ornstein led a working group of scholars and practitioners that 
helped shape the law known as McCain-Feingold that reformed the 
campaign finance system. He was elected as a fellow of the 
American Academy of Arts and Sciences in 2004.
    His many books include ``The Permanent Campaign and Its 
Future.'' He coauthored ``The Broken Branch: How Congress Is 
Failing America and How to Get It Back on Track'' and also has 
coauthored, the most recently, ``Vital Statistics on Congress 
2008.''
    And with that, I will turn it over for testimony by Dr. 
Ornstein.

   STATEMENTS OF NORMAN ORNSTEIN, RESIDENT SCHOLAR, AMERICAN 
       ENTERPRISE INSTITUTE; MONICA YOUN, BRENNAN CENTER 
  CONSTITUTIONAL FELLOW, NYU SCHOOL OF LAW; ZEPHYR TEACHOUT, 
ASSOCIATE PROFESSOR, FORDHAM UNIVERSITY SCHOOL OF LAW; AND PAUL 
      S. RYAN, FEC PROGRAM DIRECTOR, CAMPAIGN LEGAL CENTER

                  STATEMENT OF NORMAN ORNSTEIN

    Mr. Ornstein. Thanks, Mr. Chairman, Madam Leader, and 
members of this panel, many of whom I have worked with on some 
of these issues.
    I do have a written statement. I just want to make three 
quick points.
    The first is about the Citizens United decision, a decision 
that I think has reverberated around the country, and I have 
seen it in my own travels, in discussions with people more than 
any other in the last several decades. The first thing I want 
to say is I actually have never seen a decision more poorly 
reasoned or removed from reality as this one.
    The idea, first of all, that corporations should be treated 
the same as people when it comes to political involvement. When 
individuals in the society have a multiplicity of interests and 
motives, some of them very personal related to their own lives, 
but others that reach out to the larger society and with an 
interest in the futures of our children and grandchildren. 
Corporations have one motive, which is profits.
    At the same time, the idea that money equals speech--the 
more money, the more speech, the better--flies in the face of 
another reality. If I am speaking with my own voice or just 
with one microphone to amplify it and you have 30-foot speakers 
and an amplifier that can shake the seats at Nationals Park, 
and we are both trying to speak at the same time, I don't view 
that as something that is good for dialogue in a society. But 
we have now created a situation where there is enormous 
leverage for those with those amplifiers.
    And I have to say that sitting in the Supreme Court, as it 
argued--had an oral argument over the McComish decision, 
another in a string of destructive decisions made by the court, 
the logic applied there, which was involving the public funding 
system in Arizona, where if a multimillionaire spent 
significant sums of his or her own money and opted out of that 
public funding system, that the candidate who had opted in 
could raise a little bit more money. The idea that that would 
damage the speech of the multimillionaire is a kind of logic 
that, it seemed to me, belonged on another planet or in another 
galaxy. But that is what we are talking about here.
    And finally, the idea in Citizens United and Justice 
Kennedy's decision that independent expenditures can't be 
corrupting also belongs in another galaxy. The point I would 
make there is, For anybody who has been for more than 10 
minutes around the halls of this body or in any legislative 
body, but now especially in the aftermath of Citizens United, 
watching the pressures to raise money, watching what happens 
when Members no longer have to worry simply about competing 
against a candidate but against now the nightmare that, with 3 
weeks to go in an election, some alien predator group 
anonymously can parachute in behind your lines and spend $20 
million to slime you, and you have to raise money in small 
increments--there is no time to do it--has put everybody on 
notice that they better raise war chests in advance.
    And that means whether you are in this building or standing 
outside, watching Members stream out in any odd moment to do 
call time, which has now become far more significant, and 
knowing what, as a member of this committee Barney Frank has 
said, the demeaning process of having to go out and either beg 
for money or shake people down. If that is not corrupting, I am 
not sure what is.
    And frankly, the independent amounts, the large amounts 
that can be spent, the unlimited amounts, I have had lots of 
people--senators in particular--tell me of their experiences 
sitting down with somebody who says the equivalent of, you 
know, ``I am working with Americans for a Better America, and 
they have got more money than God. They really want this 
amendment. And, if anybody challenges them and doesn't do it, I 
don't know what they will do. But $20 million in the last few 
weeks of a campaign, that is not beyond them.'' The result is, 
we not only will have more money, but we are going to have more 
amendments, more provisions that nobody will know about, 
without a dime being spent. That is what unlimited money can 
do.
    My final point is, this is a problem with the Supreme 
Court. That is a big lift until we get a change in the court. 
We have to turn to other agencies where we can begin to get 
some other impact that can bring us back to true independence 
instead of the farce that we have now that Stephen Colbert and 
our colleague, Trevor Potter, have pointed out so well, and to 
real disclosure.
    It would be nice if we could have gotten--it would have 
been nice if we had gotten one Republican in the Senate to 
support the DISCLOSE Act, including those who now talk 
eloquently about the need for it in the last Congress. It would 
be nice now if we can get a Federal Election Commission not to 
deadlock 3-3 on almost every instance in which we enforce the 
law.
    The problem is not just Citizens United. It is that laws on 
the books, everybody who is involved in this process knows you 
can do almost anything that you want.
    I hope you will support the Federal Communications 
Commission as it moves forward now, commendably, with its 
action to require broadcasters to put in their public file 
online, in real time, the donors to the ads that they are 
giving, which is being resisted strenuously by the same 
broadcasters who are making billions of dollars in profits from 
all of the ads that are going up. And I hope that you will also 
work with the IRS to enforce its own regulations and the 
Securities and Exchange Commission to require public 
corporations to disclose all of their expenditures in this 
area.
    And finally, let me just say, it is worth thinking about an 
idea that has been raised by a lawyer named Gregory Colvin to 
introduce a law that would limit the political expenditures of 
501(c)(4)s. I am not sure how much we can rely on the IRS, and 
it may be worthwhile, as well, to pass a law that makes this 
more explicit.
    Thank you very much.
    [The statement of Mr. Ornstein follows:]

Testimony of Norman J. Ornstein, Resident Scholar, American Enterprise 
 Institute, Before the Congressional Forum on Campaign Finance Reform, 
                             April 18, 2012

    Mr. Chairman and members of the Forum, thank you for the 
opportunity to testify on the new world of campaign finance since the 
Citizens United decision. I have written a fair amount about this 
decision and its destructive and disastrous consequences for the 
nation, and I will draw on some of that writing here.
    I cannot recall a Supreme Court decision that has generated more 
interest and more dismay. As I travel around the country and abroad, it 
comes up repeatedly as a disaster in the making. The decision itself, 
in my judgment, was an embarrassment in terms both of reasoning and a 
lack of attachment to reality. The idea that corporations are 
fundamentally the same as individuals when it comes to participation in 
the electoral arena is at best wrong-headed. Individuals have multiple 
interests and motives, some intensely personal but others more public 
interested, including a long-term concern for the wellbeing of one's 
children and grandchildren, while corporations have one interest, 
maximizing profits.
    The idea that money equals speech, and the more speech the better, 
ignores what happens when one entity might have only his or her own 
voice while the next one has thirty foot speakers and a ten-foot high 
amplifier that can wholly drown out everyone else. The notion that 
``independent'' contributions cannot be corrupting reflects a 
breathtaking naivete--something underscored in a recent commentary by 
conservative jurist Richard Posner. Consequences aside, Justice Anthony 
Kennedy's decision may go down as one of the most poorly reasoned and 
bolstered decision in modern times.
    For all its problems, Citizens United at least offered full-
throated, 8-1 support for robust disclosure and made it clear that the 
decision applied only to corporate involvement in independent 
expenditure campaigns, not in direct involvement in the campaigns 
themselves. But that unequivocal support for disclosure and clear 
invocation of the need for real independence, has been met with 
chicanery and obfuscation on the part of the Federal Election 
Commission, a near-total lack of action to enforce its own clear 
regulations by the Internal Revenue Service, and the new ardent 
opposition to disclosure by former champions like Mitch McConnell and 
John Boehner, making disclosure a farce and independence non-existent.
    On the IRS, the recent revelation that an anonymous donor gave $10 
million to American Crossroads GPS to run negative ads against 
President Obama shows what a farce it is to enable Karl Rove's 
organization to qualify as a ``social welfare'' group, when it could 
not be more clear that American Crossroads GPS exists for one purpose, 
to influence elections and to provide a safe haven for those who do not 
want to disclose their identities. The same is true for many other 
501(c)4s.
    As for the idea that Citizens United and its progeny could not be 
corrupting, anyone who has spent more than a nanosecond in the real 
world has seen the reality. I have had conversations with several 
incumbents in the Senate who are up in 2012 who say the same thing: 
They can handle any of the several prospective opponents they might 
face--but all of them fear a stealth campaign, landing behind their 
lines and spending $20 million on ``independent'' campaigns designed to 
trash the incumbent as someone who should be behind bars, not serving 
in the Senate.
    Most politicians understand that constituents who like them don't 
really know a lot about them; voters don't spend a lot of time focusing 
on politics and politicians. So a vicious and unrelenting ad campaign 
can work. What do candidates then do? All of them are working overtime 
to raise their own, protective war chests--meaning every spare moment 
is spent on ``call time,'' begging for money or shaking down potential 
donors.
    Ask almost any lobbyist. I hear the same story there over and 
over--the lobbyist met with a lawmaker to discuss a matter for a 
client, and before he gets back to the office, the cell phone rings and 
the lawmaker is asking for money. The connections between policy 
actions or inactions and fundraising are no longer indirect or subtle.
    Now comes the third component. As one Senator said to me, ``We have 
all had experiences like the following: A lobbyist or interest 
representative will be in my office. He or she will say, `You know, 
Americans for a Better America really, really want this amendment 
passed. And they have more money than God. I don't know what they will 
do with their money if they don't get what they want. But they are 
capable of spending a fortune to make anybody who disappoints them 
regret it.''' No money has to be spent to get the desired outcome.
    This is what Citizens United hath wrought. It is thoroughly 
corrupting. And it is why, at minimum, we need to encourage the IRS to 
do its job and implement its own regulations related to 501(c)(4)s, 
rejecting the status for sham organizations that manipulate the process 
only to shield the identity of donors and making big donors pay a gift 
tax on their sham contributions; encourage and defend the Federal 
Communications Commission in its commendable decision to put online 
information from TV stations about the funders of political ads; urge 
the Securities and Exchange Commission to require public companies to 
disclose their political spending to shareholders in their annual 
reports; and extend the current regulations for private contractors 
with the government who have to disclose their direct campaign 
contributions and expenditures to include the stealth contributions to 
influence campaigns. Besides urging the president to implement the 
executive order to accomplish the latter goal, I encourage you also to 
urge the president to use his recess appointment authority to replace 
the five of six Federal Election Commission members whose terms have 
expired.
    Finally, I would encourage you to examine a proposal by lawyer 
Gregory Colvin to amend the Internal Revenue Code to put an annual 
limit on political expenditures by 501(c)4s, which might be a more 
fruitful route than relying on the IRS itself to act.

    Mr. Gonzalez. Thank you very much, Dr. Ornstein.
    I am going to be going a little out of order. I don't mean 
to throw you all off, but the next witness is going to be 
Monica Youn from the Brennan Center, Constitutional Fellow. Her 
education consists of a B.A. from Princeton, Master's in 
philosophy from Oxford, and J.D. from the Yale Law School.
    Monica Youn is the inaugural Brennan Center Constitutional 
Fellow at NYU School of Law, where she focuses on election law 
and First Amendment issues. She is the editor of ``Money, 
Politics, and the Constitution: Beyond Citizens United,'' a 
book of essays by leading constitutional scholars, and she has 
published law review articles on election law issues.
    She has litigated election law cases in federal courts 
across the Nation and has testified before Congress on multiple 
occasions. Her political commentary has been published in Roll 
Call, Slate, the L.A. Times, among other publications. She has 
appeared on MSNBC; PBS; the NewsHour; Democracy Now!; and the 
Bill Moyers Journal.
    Her work at the Brennan Center has been recognized by the 
New Leaders Council, which named her one of their ``40 under 
40'' nationwide leaders in 2010 and by Common Cause, which 
awarded her the John Gardner Award for Extraordinary 
Leadership.
    Ms. Youn.

                    STATEMENT OF MONICA YOUN

    Ms. Youn. Thank you.
    Well, it is 6 months out from the general election, and it 
seems a little bit early for a weather report. But it seems 
already clear to everyone in this room and outside this room 
that the 2012 election is shaping up to be a perfect storm of 
money in politics.
    We have unprecedented levels of outside spending, combined 
with massive loopholes in federal disclosure laws, which has 
led to a situation that is really kind of the worst of all 
possible worlds.
    I wanted to focus my testimony, first of all, on the 
definition and derivation of Super PACs. I then wanted to talk 
specifically about what changed in the law between the post-
Citizens United era and the pre-Citizens United era, and then 
to talk about--very briefly about some of the faulty 
assumptions underlying the logic of Citizens United.
    So Super PACs are the latest and greatest soft money 
loophole, a phenomenon that threatens to overwhelm our 
politics. Unlike the other major players in campaign 
fundraising--candidates, political parties, and traditional 
PACS--Super PACS have a court-conferred advantage. They do not 
have to play by the same fundraising rules as everyone else.
    Those other entities are all bound by federal contribution 
limits, which regulate that both the source and amount of 
contribution, and none of those entities can receive 
contributions from corporate or union general treasury funds. 
By contrast, Super PACs can raise and spend unlimited funds not 
only from wealthy individuals, but also directly from corporate 
treasuries. And, because of loopholes in federal election 
disclosure laws, including the (c)(4) loophole discussed by 
Stephen Colbert and, you know, the anonymous shell corporations 
also created by Stephen Colbert, many of the sources of these 
funds remain cloaked in secrecy.
    So this morning's L.A. Times, for instance, reported that 
Crossroads GPS, which is the (c)(4) that funds American 
Crossroads, has received $77 million in undisclosed donations, 
money that we can expect to have a major impact on what happens 
with--on the electoral spending that Crossroads GPS is 
permitted under current laws to engage in. We don't know who 
these donors are. We don't even know whether these donors are 
individuals or whether they are corporations.
    So how did we get to this state of affairs? There has been 
a lot of debate over whether the Supreme Court created Super 
PACs in its Citizens United decision. I find a lot of that 
discussion, frankly, beside the point.
    The Supreme Court didn't create or even mention Super PACs. 
Super PACs didn't exist at the time of Citizens United. But the 
logic of Citizens United directly dictated that when the D.C. 
Circuit heard the case, SpeechNow, that created Super PACs, it 
had no choice but to follow along with that reasoning.
    So what has actually changed? Because a lot of people will 
say, ``Well, you know, this is politics. Politics ain't 
beanbag. There was already corporate money in politics. There 
were already wealthy donors pouring millions of dollars into 
independent spending.''
    But you know, prior to Citizens United, corporations and 
unions could participate in politics, but they had to do so 
through their separate segregated funds or PACs. These 
consisted, crucially, of money that was limited and money that 
was voluntarily contributed by individuals--by shareholders, by 
corporate officers. And so, they had to abide by the same 
fundraising rules as everyone else. Go, hat in hand and say, 
``Hey, who wants to support the corporation's political 
agenda?''
    So, for example, in the 2008 election cycle, ExxonMobil did 
exactly that. They went around, hat in hand, to their employee 
shareholders. They collected about $700,000, which is a very 
respectable amount of money.
    But during the same election cycle, ExxonMobil's corporate 
profits were $80 billion. That is a difference of more than 
100,000 times. And what Citizens United does is it allows the 
amount of money that every corporation has available to it to 
act as a potential election war chest to increase by these 
kinds of exponential figures. After Citizens United, 
corporations can spend money, often through a shell corporation 
or other loophole, and do so in an undisclosed manner.
    So, secondly, about wealthy individuals. So, some people 
have said, look, we all know about the Wyly brothers way back 
in the day. We know about George Soros, all spending money. You 
know, the Swift boat advertising. You know, wealthy donors have 
always poured money into politics.
    But that money had to be disclosed. Now that donors can 
cloak their electoral influence in secrecy, we are seeing dark 
money overwhelm the system. So as these slides will show you, 
the amount of total outside spending until March 8th of this 
year was $88 million, which is more than twice as much as 2008 
and more than six times as much as in the 2004 cycle. So, now 
that that money is in the dark, we are seeing individual 
wealthy donors just flood to this new dark avenue.
    So why did the court do this? And without--I am out of time 
here. So I am just going to briefly mention the three faulty 
assumptions that underlay the court's reasoning in Citizens 
United.
    First of all, that independent expenditures are truly 
independent. As I explain in my written testimony, that would 
depend on having a workable definition of what constitutes a 
coordinated expenditure, a definition that the FEC has utterly 
failed to promulgate or to enforce.
    The second, that existing disclosure laws will protect 
against corruption. Corporate political spending is not 
required to be disclosed either to shareholders or to corporate 
boards or to voters. It is very easy to keep this law in the 
dark. But even if disclosure laws worked, disclosure is 
necessary, but not sufficient. Disclosure points out the 
outliers, but it doesn't really take care of the heart of the 
problem.
    And thirdly, that quid pro quo corruption is the only 
problem Congress can constitutionally protect against. As Mr. 
Ornstein mentioned in his testimony, we now have lots of 
instances of ``Americans for a Better America'' or other, 
similarly euphemistic, wealthy interests throwing their weight 
around, you know, and acting in a way that is utterly 
unaccountable.
    This may resemble an oligopoly. This may resemble a 
plutocracy. But it very little resembles what we have come to 
think of as democracy.
    Thank you very much.
    [The statement of Ms. Youn follows:]

 Testimony of Monica Youn, Brennan Center Constitutional Fellow at NYU 
 School of Law, before the Congressional Forum on ``The Most Expensive 
Seat in the House: The State of Our Campaign Finance System'' April 18, 
                                  2012

    I thank Ranking Member Gonzalez for convening this forum and for 
inviting me to testify.
    In previous congressional testimony,\1\ I explored the aftermath 
and implications of the Supreme Court's watershed campaign finance 
decision Citizens United v. FEC.\2\ Rather than reiterating that 
analysis here, I will focus my testimony more narrowly on the linkage 
between Citizens United and recent developments in our campaign finance 
system, paying particular attention to the ``Super PAC'' phenomenon 
that has dominated the early phases of the 2012 election cycle.
---------------------------------------------------------------------------
    \1\The Fair Elections Now Act: A Comprehensive Response to Citizens 
United: Hearing Before the S. Jud. Comm., Subcomm. on Constitution, 
Civil Rights & Human Rights, 111th Cong. (2011) (statement of Monica 
Youn); The First Amendment and Campaign Finance Reform after Citizens 
United: Hearing Before H. Jud. Comm., Subcomm. on Constitution, Civil 
Rights & Civil Liberties, 110th Cong. (2010) (statement of Monica 
Youn). On the issue of campaign finance disclosure, I would also 
respectfully refer the Committee to the recent written testimony of my 
Brennan Center colleagues in the Senate Rules Committee's hearings on 
the DISCLOSE Act of 2012. The Democracy Is Strengthened by Casting 
Light On Spending in Elections Act (``DISCLOSE'') Act of 2012: Hearing 
on S. 2219 Before the S. Comm. on Rules and Admin., 112th Cong. (2012) 
(statement of Adam Skaggs and Mimi Marziani).
    \2\130 S.Ct. 876 (2010).
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                         the rise of super pacs
    Although the 2012 election cycle is still in its beginning stages, 
it is already clear that campaign fundraising will be dominated by the 
massive new independent expenditure vehicles nicknamed ``Super PACs.'' 
Unlike traditional federal PACs, Super PACs only engage in independent 
expenditures, and do not donate money directly to federal candidates. 
Also unlike traditional PACs, which are bound by federal contribution 
limits and cannot accept corporate or union contributions, Super PACs 
can take in and spend unlimited amounts, including monies from 
corporate and union treasury funds.\3\
---------------------------------------------------------------------------
    \3\See also FEC Advisory Opinion 2010-11, July 22, 2010, at http://
saos.nictusa.com/aodocs/AO%202010-11.pdf.
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    As of May 2012, Super PACs have raised almost $160 million dollars 
this election cycle and have spent close to $90 million--more than six 
months from the general election.\4\ In state after state, Super PACs 
have outspent the campaigns of those they are supporting.\5\ And, in 
numerous primaries, Super PAC spending has been credited as the 
deciding factor in electoral results.\6\
---------------------------------------------------------------------------
    \4\2012 Outside Spending, by Super PACs, Opensecrets.Org, http://
www.opensecrets.org/outsidespending/summ.php?cycle= 
2012&chrt=V&disp=O&type=S (last visited April 13, 2012).
    \5\For instance, in Alabama and Mississippi almost all of the 
television ads promoting presidential contenders were paid for by Super 
PACs rather than the candidates' campaigns. Greg Giroux, Super-PAC Ads 
Dominate Republican Race in Alabama, Mississippi, Bloomberg 
Businessweek (March 13, 2012), http://www.businessweek.com/news/2012-
03-12/super-pacs-dominate-republican-ads-aired-in-alabama-mississippi-
primaries.
    \6\See, e.g., Paul Blumenthal, Newt Gingrich South Carolina Surge 
Boosted By Super PAC Spending Spree, HuffingtonPost.Com (Jan. 20, 2012, 
2:05 PM), http://www.huffingtonpost.com/2012/01/20/newt-gingrich-south-
carolina-super-pacs-pending-n-1219093.html.
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    Although the Supreme Court's opinion in Citizens United did not 
create or contemplate Super PACs, the logic of Citizens United directed 
the result in SpeechNow v. FEC,\7\ the D.C. Circuit decision that 
legalized Super PACs. In Citizens United, Justice Kennedy's opinion 
stated that ``independent expenditures, including those made by 
corporations, do not give rise to corruption or the appearance of 
corruption.''\8\ Accordingly, under the Court's reasoning, since 
restrictions on independent expenditures serve no anti-corruption 
interest, they fail to pass constitutional muster. Following this 
reasoning, the SpeechNow court held that corporations and unions could 
make unlimited donations to PACs, so long as those PACs only engaged in 
``independent expenditures'' and did not directly coordinate with a 
campaign.
---------------------------------------------------------------------------
    \7\599 F.3d 686 (D.C. Cir. 2010), cert. denied, 131 S.Ct. 553 
(2010).
    \8\130 S.Ct. at 909.
---------------------------------------------------------------------------
    The Super PAC phenomenon throws into sharp relief the faulty 
assumption that underlies the majority's reasoning in Citizens United--
that no risk of corruption attaches to expenditures that are 
technically ``independent'' of a candidate's campaign. While Super PACs 
were freed from contribution limits because they declared themselves 
legally ``independent'' of candidate campaigns, the reality is that 
they are anything but independent.
                      the myth of ``independence''
    Despite the Supreme Court's repeated explanation that independent 
expenditures must be truly and wholly independent--made ``without any 
candidate's approval (or wink or nod),''\9\--the FEC has failed to 
promulgate regulations that ``rationally separate[] election-related 
advocacy from other activity'' since the Bipartisan Campaign Reform Act 
was enacted in 2002.\10\ As a result, under the FEC's current 
regulations, candidates can coordinate extremely closely with a 
supportive Super PAC, and yet still be deemed not to have produced any 
``coordinated communications,''\11\ and not to have ``coordinated'' 
with that candidate's campaign.\12\
---------------------------------------------------------------------------
    \9\Colorado Republican Federal Campaign Comm. v. FEC, 533 U.S. 431, 
442 (1996); McConnell v. FEC, 540 U.S. 93, 221-22 (2003).
    \10\See, e.g., Shays v. FEC, 414 F.3d 76, 102 (D.C. Cir. 2005), 
aff'g 337 F. Supp. 2d 28 (D.D.C. 2004); Shays v. FEC, 528 F.3d 914, 925 
(D.C. Cir. 2008), aff'g 508 F. Supp. 2d 10 (D.D.C. 2007).
    \11\See 11 C.F.R. Sec. 109.21.
    \12\See 11 C.F.R. Sec. 109.20.
---------------------------------------------------------------------------
    Since Citizens United, the FEC has deadlocked on several opinions 
concerning the meaning of ``coordination'' and ``independent,'' 
establishing beyond question that the agency will not meaningfully 
distinguish wholly independent groups from those that, in reality, 
coordinate closely with candidates. Most egregiously, the FEC failed to 
reject a Super PAC's request that it be permitted to claim continued 
legal independence, and not be deemed to issue ``coordinated 
communications'' despite producing television ads that were ``fully 
coordinated'' with candidates. That the FEC deadlocked on this request, 
issuing no binding ruling, underscores that the agency tasked with 
overseeing the nation's campaign finance laws is unable or unwilling to 
enforce any meaningful lines between groups that meet the Court's 
strict definition as ``wholly independent'' from candidates, and those 
that claim independence while actually coordinating closely with 
candidates and undermining campaign finance rules. Indeed, the FEC has 
allowed candidates to appear at fundraisers, and solicit funds, for 
Super PACs that exist for the sole purpose of electing those 
candidates--while permitting the Super PACs to continue claiming legal 
independence.\13\ In short, the dysfunctional FEC has now effectively 
sanctioned almost limitless cooperation between Super PACs and the 
candidates they seek to elect--defying any notion that the groups meet 
any commonly-held definition of ``independence.''
---------------------------------------------------------------------------
    \13\13 Derek Willis Federal Officials Can't Raise Unlimited Funds, 
F.E.C. Says, Caucus Blog, NYTimes.com (June 30, 2011), http://
thecaucus.blogs.nytimes.com/2011/06/30/federal-officials-cant-raise-
unlimited-funds-f-e-c-says/ (explaining that while the FEC rejected a 
request to allow federal officials to raise unlimited funds for Super 
PACs, such candidates would be allowed to solicit contributions for 
Super PACs up to the legal limits).
---------------------------------------------------------------------------
    The result is that many candidates (including all of the 
competitive presidential candidates) have an affiliated Super PAC 
acting as a de facto arm of their campaign. The proliferation of 
candidate-specific Super PACs provides ample opportunity for 
corruption, as contribution limits have become irrelevant and 
supporters can give unlimited gifts that are functionally 
indistinguishable from contributions to the candidates. For this 
reason, Judge Richard Posner recently concluded, after considering the 
current state of affairs:

          It thus is difficult to see what practical difference there 
        is between super PAC donations and direct campaign donations, 
        from a corruption standpoint. A super PAC is a valuable weapon 
        for a campaign. . . . [T]he donors to it are known; and it is 
        unclear why they should expect less quid pro quo from their 
        favored candidate if he's successful than a direct donor to the 
        candidate's campaign would be.\14\
---------------------------------------------------------------------------
    \14\Richard Posner, Unlimited Campaign Spending--A Good Thing?, The 
Becker-Posner Blog (April 8, 2012), http://www.becker-posner-blog.com/
2012/04/ unlimited-campaign-spendingagood-thing-posner.html.

Super PACS have further blurred the already problematic distinction 
between direct contributions and independent expenditures.
                 the end-run around contribution limits
    Campaign contribution limits--including the century-old ban on 
corporate contributions to candidates--are one of the cornerstones of 
federal campaign finance regulation. The creation of Super PACs that 
function as shadow campaigns has eviscerated contribution limits and 
the ban on corporate campaign contributions.
    First, Super PACs have rendered the dollar limits on individuals' 
direct contributions to candidates toothless, if not entirely illusory. 
Individuals who have donated the legal maximum to their favored 
candidate can still give unlimited amounts to a super PAC dedicated to 
electing that candidate, with knowledge that the latter contribution is 
just as valuable to the candidate as the former. Wealthy donors have 
seized on this contribution limit end-run. For example, in 2011, 84% of 
the 205 donors to the super PAC supporting Mitt Romney had given the 
maximum donation to Romney's primary campaign--including five donors 
who each gave $1 million or more to the super PAC.\15\ The Super PAC 
supporting President Obama has also benefitted from the largesse of 
donors who have given the maximum amount to his campaign, receiving $2 
million from DreamWorks CEO Jeffrey Katzenberg (and another $100,000 
from DreamWorks partner Stephen Spielberg) and $1 million from comedian 
Bill Maher. The $2,500 contributions that all these donors have given 
to the candidate's actual campaign committees pale in comparison to 
what they have donated to candidates' shadow campaigns.
---------------------------------------------------------------------------
    \15\Paul Harris, Super PAC Donors Often Max Out on Individual 
Donations, Study Finds, Guardian, Feb. 21, 2012.
---------------------------------------------------------------------------
    Second, candidate-specific Super PACs have made a mockery of the 
prohibition on corporate campaign contributions by allowing 
corporations to contribute millions for electioneering expenditures 
that are as valuable to candidates as contributions to their own war- 
chests. Even at this early stage of the campaign, numerous corporations 
have donated more than $1 million to Super PACs working to elect 
specific candidates; other companies have made valuable, albeit lesser, 
Super PAC contributions.\16\ We can expect corporate participation in 
Super PACs to increase as the election cycle moves from party primaries 
to the general election.
---------------------------------------------------------------------------
    \16\See Phil Hirschkorn, Super PAC Donors by the Numbers, CBS NEWS 
(Mar. 22, 2012), http://www.cbsnews.com/8301-503544_162-57402073-
503544/super-pac-donors-by-the-numbers (listing several corporations 
that each gave $1 million to super PACs).
---------------------------------------------------------------------------
    Moreover, corporations have made political contributions that favor 
candidates while avoiding public disclosure of this spending by routing 
their dollars through nonprofit organizations that spend money to 
influence elections--including by donating to Super PACs--but are not 
required to disclose their donors.\17\
---------------------------------------------------------------------------
    \17\Andrew C. Byrnes & Cortlin H. Lannin, I Went Down to the 
Crossroads: Lifting the Blindfold about the Origin of 501(c)(4) 
Political Advertisements, 46 U.S.F. L. REV. 481, 483, 493-96 (2011); 
see also Jonathan D. Salant, Payday Lender Political Donors Hidden in 
Corporate Names, Bloomberg.Com (Mar. 21, 2012, 8:00 PM), http://
www.bloomberg.com/news/2012-0322/payday-lender-political-donors-hidden-
in-corporate-names.html (describing businesses' use of limited 
liability corporations to secretly donate to super PAC supporting 
Romney).
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                the concentration of political influence
    Super PACs allow a few wealthy donors to wield disproportionate 
influence over candidates. Over $50 million in contributions to 
Republican Super PACs during the current election has come from 
``[a]bout two dozen individuals, couples or corporations.''\18\ More 
than 78% of the money donated to the super PACs active in the 
presidential election has come from just ninety donors who each gave 
more than $100,000.\19\ Over two-thirds of the money donated to Super 
PACs came from donors who gave $500,000 or more.\20\ A super PAC 
backing Newt Gingrich received almost all of its money from casino 
magnate Sheldon Adelson and his family, who donated over $16 
million.\21\ On the other side of the aisle, more than three-fourths of 
the money contributed to the Super PAC supporting President Obama has 
come from donors giving over $500,000.\22\
---------------------------------------------------------------------------
    \18\18 Nicholas Confessore et al., In G.O.P. Race, a New Breed of 
Superdonor, N.Y. Times, Feb. 22, 2012, at A1.
    \19\19 Lee Drutman, The Presidential Super PACs: Five Takeaways, 
Sunlight Foundation Blog (Feb. 1, 2012, 3:35 PM), http://
sunlightfoundation.com/blog/2012/02/01/ superpac-takeaways.
    \20\20 Fredreka Schouten et al., Big-bucks Donations to Super PACs 
Keep the GOP Race Going, USA Today, Mar. 21, 2012.
    \21\21 Id.
    \22\Id.
---------------------------------------------------------------------------
    The enormous amounts given by a small number of donors raise the 
clear possibility that candidates will feel indebted to donors and 
grant them favors once in office. For instance, Billionaire Julian 
Robertson has acknowledged that, in light of the $1.25 million he has 
given to Restore Our Future, Romney might take Robertson's phone call 
if he became president.\23\ It has long been an unfortunate truth of 
our politics that major donors receive increased access to candidates 
and officeholders,\24\ but to have such expectations of access 
predicated on supposedly ``independent'' expenditures highlights the 
extent to which Super PACs' purported ``independence'' is a widely-
recognized fiction.
---------------------------------------------------------------------------
    \23\Wyatt Andrews & Phil Hirschkorn, Billionaire Super PAC Donor 
Julian Robertson Speaks Out, CBS News (Apr. 6, 2012), http://
www.cbsnews.com/8301-503544_162-57410709-503544/billionaire-super-pac-
donor-julian-robertson-speaks-out.
    \24\Mike McIntyre & Michael Luo, White House Opens Door to Big 
Donors, and Lobbyists Slip In, NY Times, April 14, 2012, at A1.
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                    the erosion of public confidence
    Finally, Super PACs have created the appearance of corruption and 
seriously undermined public confidence in elections and democracy, as 
shown by media coverage and public opinion polls. There has been 
thunderous opposition to the opportunities for corruption created by 
unlimited Super PAC money in elections.\25\ Public opinion polls reveal 
wide agreement with the news media's concerns about super PACs and 
corruption. Americans strongly disapprove of Super PACs and independent 
spending in elections:
---------------------------------------------------------------------------
    \25\See, e.g., Editorial, The Power of Super PACs, Wash. Post, Jan. 
9, 2012 (``The risk of corruption in candidate-specific super PACs is 
as great as the size of supporters' checkbooks.''); Editorial, The 
Broken System of Campaign Finance, San Diego Union-Tribune, Dec. 5, 
2011 (arguing that super PACs collaborate with campaigns and expressing 
concern about ``the corrupting influence of money, or the appearance of 
such influence''); Editorial, The Campaign Jungle, N.Y. Times, Nov. 13, 
2011, at SR10 (arguing that super PACs coordinate with candidates and 
concluding, ``Limits on spending used to prevent donations from 
becoming outright bribes, but now the limits are gone, and the path to 
corruption is clear.''); Editorial, Not So Super, Raleigh News & 
Observer, Oct. 14, 2011 (arguing that interest groups that donate to 
super PACs are ``betting on dividends'' once candidates are elected); 
Editorial, Our View: Presidential Race Not the Place for Secret Donors, 
USA Today, Aug. 21, 2011 (comparing use of super PACs and nonprofit 
corporations in election spending to organized crime).
---------------------------------------------------------------------------
    
 One poll found that 69% of all Americans agree that Super 
PACs should be made illegal; the poll found majority support for 
banning Super PACs across political parties and the political 
spectrum.\26\
---------------------------------------------------------------------------
    \26\Damla Ergun, Seven in 10 Would Send Super PACs Packing, ABC 
News (Mar. 13, 2012), http://abcnews.go.com/blogs/politics/2012/03/
seven-in-10-would-send-super-pacs-packing.
---------------------------------------------------------------------------
    
 Sixty-seven percent of Americans--again including 
majorities of Republicans, Democrats, and independents--said that there 
should be legal limits on the amount independent groups can spend on 
advertisements during a presidential campaign.\27\
---------------------------------------------------------------------------
    \27\Brian Montopoli, Poll: Most Want Limits on Campaign Spending, 
CBS News (Jan. 18, 2012), http://www.cbsnews.com/8301-503544_162-
57361428-503544/poll-most-want-limits-on-campaign-spending.
---------------------------------------------------------------------------
    
 Of those who are aware of the post-Citizens United rules 
allowing unlimited independent expenditures on political 
advertisements, 65% say the regime is having a negative effect on the 
2012 presidential campaign.\28\
---------------------------------------------------------------------------
    \28\Super PACs Having Negative Impact, Say Voters Aware of 
`Citizens United' Ruling, Pew Research Center. 1 (Jan. 17, 2012), 
http://www.people-press.org/files/legacy-pdf/1-17-
12%20Campaign%20Finance.pdf.
---------------------------------------------------------------------------
    
 And a majority of Americans believe the nation needs new 
campaign finance laws, ``a marked increase from three years ago.''\29\
---------------------------------------------------------------------------
    \29\58% Say U.S. Needs New Campaign Finance Laws, Rasmussen Reports 
(Jan. 22, 2012), http://www.rasmussenreports.com/public_content/
politics/general_politics/january_2012/
58_say_u_s_needs_new_campaign_finance_laws.
---------------------------------------------------------------------------
These polling results demonstrate the fallacy of Justice Kennedy's 
prediction in Citizens United that ``the appearance of influence or 
access will not cause the electorate to lose faith in this 
democracy.''\30\ But this crisis of confidence opens up new 
opportunities for reform.
---------------------------------------------------------------------------
    \30\130 S. Ct. at 884.
---------------------------------------------------------------------------
          * * * * * * *
    The 2012 general election is barely underway, yet already the 
corrosive effects of Super PACs and similar failures of disclosure, 
coordination, and enforcement policy threaten to undermine the 
integrity of our electoral officials and the citizens' faith in our 
electoral system. We strongly urge the Committee to hold hearings and 
take further action to prevent further erosion of the foundations of 
our democracy.

    Mr. Gonzalez. Thank you very much. Excuse me.
    The next witness will be Zephyr Teachout, associate 
professor of law, Fordham University School of Law. Received 
her education, her B.A. from Yale University, her Master's in 
political science from Duke, and her J.D. from Duke.
    She is a talented and very creative scholar. Professor 
Teachout brings a rich background in laws governing political 
behavior, both domestically and abroad, as well as the insights 
of her original work on corruption and its constitutional 
history.
    Her 2009 article, ``The Anti-Corruption Principle,'' was 
cited by Justice Stevens in his Citizens United dissent for 
showing, among other things, that the Founders ``discussed 
corruption more often in the Constitutional Convention than 
factions, violence, or instability.''
    Professor Teachout.

                  STATEMENT OF ZEPHYR TEACHOUT

    Ms. Teachout. Thank you so much. It is Zephyr.
    Thank you so much for having me. I am going to do two 
things in my remarks. First, talk about history and then talk 
about the future.
    I want to place Citizens--is that better?--I want to place 
Citizens United in a broader historical context. As a friend of 
mine, a Texas lawyer who taught at Duke, said about Buckley v. 
Valeo, ``They went and got drunk on the First Amendment, didn't 
they?''
    And since Buckley v. Valeo, the last 30-odd years of 
jurisprudence have been wildly outside the initial 180 years of 
thinking about the First Amendment and thinking about 
Congress's power to limit corruption through political 
regulation. Up until Buckley, it was not a sensible argument to 
claim that Congress couldn't do what it needed to do to prevent 
money overcoming political power.
    Just one of many examples: in 1874, the United States 
Supreme Court refused to enforce a contract between an old man 
and a lobbyist because they said lobbying was against the 
public policy of the United States. And if the great 
corporations of our day were to hire adventurers to lobby in 
the halls of Congress, that would corrupt and degrade the 
entire institution. Several states had laws criminalizing 
lobbying. And certainly, up until Buckley v. Valeo, the 
assumption was that one could limit campaign expenditures, as 
well as contributions.
    Since Buckley, you know somewhat from what others have said 
about the eccentricity of the Court in the context of campaign 
contributions, but there has been a parallel eccentricity in 
interpreting federal bribery and extortion statutes. So, in 
1991, the Supreme Court says even though many campaign 
contributions would otherwise count as extortion or violation 
of federal extortion laws, in this area alone we are going to 
require a specific promise on the part of the legislature in 
return for a donation.
    So that we are going to carve out an exception within 
federal bribery laws and say, ``Here, when it is campaign 
contributions, it is not bribery.'' So this creates this 
incredible bait and switch.
    Because, in the context of bribery laws, we say, ``Don't 
worry, campaign finance laws will cover it.'' And then, in 
Citizens United and other cases, Kennedy says, ``Don't worry, 
bribery laws will cover it.'' And what you end up is this great 
cavity where what you and I and the rest of the country knows 
is corruption in the sense the Founders meant is allowed to go 
on.
    So we are, as Monica suggested, in this terrible world 
where you spend all your time begging for people to give you 
$2,500 and to bring people together who can give you that much. 
And, at the same time, you need to be then scared of the 
company that might come in or might not and roil your local 
constituency and swarm it with ads.
    If you don't change this, you know and I know and the 
country knows, it is a bad couple of years, but it is about to 
get much worse. The culture of corporations has not yet adopted 
the Citizens United law. They have not yet hired the best 
campaigners. They have not yet figured out all the loopholes. 
This is 2 years in. So it is so important to do something now.
    Now with--I am former national director of the Sunlight 
Foundation, I am a former political campaigner, and I am a 
scholar. I think disclosure is extremely important. But I do 
not think you can X-ray a sick patient into health, and I do 
not think that X-rays alone are sufficient and disclosure alone 
is sufficient for the level of threat that we have right now in 
this country.
    It is critical that this Congress focus on changing the 
structure of the way campaigns are funded. Low-dollar matching 
funds. I know. I was the director of online organizing for 
Howard Dean's presidential campaign. We figured out, and we 
have seen Barack Obama do extraordinary things with this. We 
know how to allow you to spend your time talking to 100 people 
who will give you $100 instead of the richest people in the 
world.
    You may lose your jobs fighting for changing the structure 
of money in politics. But if you don't do this, you can't do 
anything else. You can't do anything about too-big-to-fail-
companies if you are scared about them coming into your 
district. You know that. You can't do anything about capital 
gains tax or the financial transactions tax with this kind of 
funding mechanism.
    So thank you for having me, and I look forward to seeing 
what happens.
    [The statement of Ms. Teachout follows:]

Testimony of Zephyr Teachout, Associate Professor, Fordham Law School, 
 before the Congressional Forum on Campaign Finance Reform, April 18, 
                                  2012

    Our country was formed in reaction to corrupt British politics. The 
Declaration of Independence was, among other things, a declaration of 
separation from the politics of dependence which the Founders saw in 
Britain. They perceived a country with a basically good constitutional 
structure that had rotted from the inside out because of the king's 
power to make officers and parliamentarians dependent upon him. They 
saw the way that ``rotten boroughs'' could be bought, that allegiances 
could be shifted because of money. Corruption fears--fears of a 
``conspiracy against liberty . . . nourished by corruption'' were ``at 
the heart of the Revolutionary movement.''\1\ The fear of corruption 
was ``near unanimous'' as was the sense that corruption needed to be 
``avoided, that its presence in the political system produced a 
degenerative effect.''\2\ George Mason said as the Constitutional 
Convention got under way that ``If we do not provide against 
corruption, our government will soon be at an end.''\3\ In the 
Federalist Papers, Hamilton explained that ``[n]othing was more to be 
desired than that every practicable obstacle should be opposed to 
cabal, intrigue, and corruption.''\4\
---------------------------------------------------------------------------
    \1\Bernard Bailyn, The Ideological Origins of the American 
Revolution, xiii (1992).
    \2\James D. Savage, Virtue and Corruption at the Constitutional 
Convention, 56 The Journal of Politics 1 (1994).
    \3\Notes of Yates, June 22, 1787, in 1 The Records of the Federal 
Convention of 1787 (Max Farrand ed.).
    \4\Alexander Hamilton, Federalist 68.
---------------------------------------------------------------------------
    They were right to be concerned about corruption and how money, 
allowed free rein in politics, can corrupt democracy. It is important 
to remember how rare self-government is in world history. Most 
governments are not representative; in most times and places, 
concentrated economic power rules, directly or indirectly. The founders 
were well aware of the tendency to oligarchy and monarchy. In John 
Dickinson's long speech on the value of mixed government, he argued 
that ``If antient republics have been found to flourish for a moment 
only & then vanish for ever, it only proves that they were badly 
constituted; and that we ought to seek for every remedy for their 
diseases.''\5\ After the Philadelphia convention, a woman allegedly 
asked Benjamin Franklin, ``what have we got, a republic or a 
monarchy?'' Franklin is rumored to have replied, ``A republic, Madame, 
if you can keep it.''
---------------------------------------------------------------------------
    \5\Notes of Madison, June 2, 1787 in The Records of the Federal 
Convention of 1787 (Max Farrand ed.).
---------------------------------------------------------------------------
    It is now our challenge to keep it. We are now again facing a new 
politics of dependence. Citizens United and its precursors threaten to 
destroy the rare self-government that we are privileged enough to have 
inherited.
    The Supreme Court in Citizens United showed a lack of understanding 
of how politics actually worked. But it was also radical--in a 
doctrinal sense. To get a sense of how radical the First Amendment 
interpretation is, consider that the first century-and-a-half of our 
country, no one seriously thought that the First Amendment should be 
used to prohibit legislation that built hurdles between economic and 
political power. In the 1870s, the Supreme Court refused to enforce a 
contract to lobby at all, because it was corrupt and against the public 
policy of the United States. The Court warned:

          If any of the great corporations of the country were to hire 
        adventurers who make market of themselves in this way, to 
        procure the passage of a general law with a view to the 
        promotion of their private interests, the moral sense of every 
        right-minded man would instinctively denounce the employer and 
        employed as steeped in corruption, and the employment as 
        infamous.\6\
---------------------------------------------------------------------------
    \6\Trist v. Child, 88 U.S. at 451 (1874).

    The First Amendment was not even raised as an issue in that case. 
Half a century later, the First Amendment became a valuable tool in 
protecting dissident speech but, starting with Buckley v. Valeo, also 
became a radical wedge used by ideologues who proposed that there 
should be no levies raised between money and politics. The great 
corporations of the country are invited, because of Citizens United, 
not only to lobby, but to promote their private interests through 
unlimited expenditures. They are invited to threaten would-be 
representatives with swift and brutal campaigns if they oppose their 
corporate agendas. The Court's use of the First Amendment is bad 
history, bad law, and bad political theory.
    Obviously, money will always have an influence on politics. But it 
is one thing to say that money and politics will always have some 
relationship, it is another altogether to give up on responsive self-
government altogether. Structural rules matter. The shape of that 
influence is not inevitable. As Members of Congress, you know how laws 
shape incentives.
    In the short term--and regardless of what happens with 
Constitutional interpretation--we need to restructure how campaigns are 
funded. I urge Congress to pass a small donor matching funds system 
that would grant federal matching funds for small-dollar donations. 
Such a law would shape incentives, forcing representatives to think 
about the public. Now, faced with millions of dollars in Super PAC 
attack ads, candidates' incentives are to raise as much money as they 
can from people who can afford $2,000 and more to give--basically, 
people in the top 1 to 4% of Americans. This means that their minds 
have to be oriented towards the concerns of the richest politically 
active people in the world. At the same time, they have to be afraid of 
the political activity of corporations. Right now, with Super PACs and 
the campaign funding system in place, Members of Congress are inside a 
system that corrupts each of them every day, and takes their talents 
and turns them towards the 1% instead of the 99%. With a matching funds 
system, where a $100 donation was matched 5 to 1, their incentives 
would be to raise as many $100 contributions as possible--their 
orientation would shift to the concerns of constituents. It wouldn't 
address all the problems with Super PACS, but would significantly 
change the way representatives think and represent. Similar systems 
have been very successful in the states, and have withstood court 
challenges.
    Disclosure is essential, and any resistance to disclosure is very 
troubling. But disclosure is not a sufficient response to Citizens 
United. You cannot X-ray a sick man back to health.
    We need to understand that the worst is yet to come. Much has been 
made of the involvement of Super PACs in the presidential election. 
These Super PACs are mere children compared to what Super PACs are 
likely to become. They are playing checkers now, and we will soon be 
playing chess; the power of Super PACs at the congressional district 
level and the local level is far greater than it can be in a 
presidential race, where substantial media attention can blunt some of 
the power. Moreover, the first banking Super PAC was formed just last 
week, after claims by many that corporations would never get directly 
involved in electioneering. Scholars and commentators argue that 
corporations don't ``want'' to get involved in politics, and that it 
will hurt their reputations; in short, that independent spending is 
tacky and graceless. We need to remember that the same arguments were 
made about lobbying, but--however tacky and graceless the largest 
corporations in the world now all lobby, and accept the criticism in 
exchange for the power it gives them. I expect the same with 
independent expenditures. We are less than three years since Citizens 
United gave corporations permission to act. It takes time to change 
culture and habits and internal structures, but I anticipate that every 
major corporation will participate directly or indirectly in trying to 
shape policy through elections if the status quo holds. They will not 
be able to resist the temptation, and they, too, will seize the power 
they are given, because it will be a rational business decision to do 
so. Because it is just at the beginning, it is important to act now, 
before the structures are in place that would make change impossible.
    Until Congress deals with money and politics, it cannot deal with 
much else fairly. Just as one example, it cannot pass a financial 
transactions tax, even with enormous popular support, because of the 
fear of Wall Street's money; it cannot even fairly address the question 
about whether a financial transaction tax makes sense. It cannot, in 
short, be responsive--be democratic--and live up to the hope of the 
founders.
    The fight against corruption follows in the path of Madison, 
Hamilton, Franklin, Mason, and the other drafters of the Constitution, 
who worked so carefully to craft structures such that representatives 
would be able to serve their constituents, not the wealthy and 
powerful.
    It is my hope that this hearing will be the beginning of the 
federal government's effort to focus intensely on ways to restructure 
political campaigns within the radically limited framework allowed by 
Citizens United. I urge Congress to hold many hearings on this subject, 
and fully explore what is possible, and the potential dangers of not 
acting quickly. I believe that the country wants a full public debate 
about the future of democracy after Citizens United, and it is the 
responsibility of the United States Congress to provide that, and to 
act as quickly and aggressively as possible to save our democracy.

    Mr. Gonzalez. Thank you.
    Next witness is Paul S. Ryan of the Campaign Legal Center. 
Paul S. Ryan joined the Campaign Legal Center in October 2004. 
He has specialized in campaign finance, ethics, and election 
law for more than a decade. Mr. Ryan directs the Campaign Legal 
Center's Federal Election Commission program and regularly 
represents the Campaign Legal Center before the Commission.
    Mr. Ryan also litigates campaign finance issues before 
federal and state courts throughout the United States and has 
published extensively on the subject of election law. Mr. Ryan 
has testified as an expert on election law before numerous 
legislative bodies and government ethics agencies including the 
FEC, the California state legislature, the California Fair 
Political Practices Commission, the New York City Council, the 
New York City Campaign Finance Board, the Los Angeles City 
Council, and the Los Angeles City Ethics Commission.
    Mr. Ryan has also spoken on the topics of campaign finance 
and ethics laws at conferences around the Nation, has appeared 
as a campaign finance law expert on news programs of CNN, NBC, 
C-SPAN, and other media outlets, and has been quoted by the New 
York Times, Los Angeles Times, the Washington Post, Roll Call, 
and news publications. He received his education at the 
University of Montana, as well as the University of California, 
Los Angeles, School of Law's program in public interest law and 
policy in 2001.
    Mr. Ryan.

                   STATEMENT OF PAUL S. RYAN

    Mr. Ryan. Madam Leader, distinguished committee members, 
thank you for this opportunity to appear before you this 
afternoon. As you have already heard, the Citizens United 
decision was based on at least two faulty assumptions.
    First, that this new flood of corporate money in politics 
would actually be disclosed. And, second, that this new flood 
of corporate money in politics would actually be spent in a 
truly independent manner with respect to candidates and 
parties.
    I am going to address the nuts and bolts of existing 
statutes and regulations that undermine those two assumptions 
of the Court, and these assumptions were only made worse by the 
D.C. Circuit Court of Appeals in the SpeechNow case, which gave 
rise to the super PACs.
    Notwithstanding the Supreme Court's promise that the 
corporate money it was unleashing would be spent independently 
of candidates, current laws have been interpreted by the FEC to 
allow very close relationships between Super PACs and 
candidates. Congress, in passing the McCain-Feingold law in 
2002, ordered the FEC to rewrite its long-ineffective 
coordination rules. These coordination rules have twice been 
invalidated by federal courts over the past decade and remain 
ineffective today.
    Many assume that the coordination rules restrict general 
interaction between candidates and outside groups but, instead, 
current coordination rules regulate only discrete 
expenditures--discrete ad buys, for example--made by outside 
groups.
    Current coordination rules accommodate close personal 
relationships between candidates and the individuals operating 
Super PACs and, in fact, many of the candidate-specific Super 
PACs active in this year's elections are being run by close 
associates and friends and former employees of these 
candidates.
    The McCain-Feingold law prohibits candidates and office 
holders from soliciting unlimited funds, as well as corporate 
and union funds in any amount, so-called soft money, in 
connection with any elections. However, last year, the Federal 
Election Commission nonsensically issued an advisory opinion 
stating that candidates and their staff and office holders and 
their cabinet members can attend, speak, and be featured guests 
at these Super PAC fundraising events where unlimited funds are 
being raised so long as they do not make the actual pitch for 
the unlimited contributions. This is nonsense. The close 
relationships between Super PACs and candidates fall far short 
of the independence likely envisioned by the Supreme Court in 
Citizens United.
    On top of this, we have 501(c)(4) organizations. The 
Citizens United court's second faulty assumption, that 
disclosure laws would provide voters with the information 
needed to make informed decisions on Election Day, has not come 
to pass.
    Section 501(c)(4) organizations like Crossroads GPS will 
likely spend hundreds of millions of dollars on election ads in 
this year's elections without disclosing any of the sources of 
their funds. This is possible because, back in 2007, the FEC 
promulgated a rule gutting the McCain-Feingold law's donor 
disclosure requirement for electioneering communications.
    Whereas the statute requires groups that spend more than 
$10,000 in a calendar year on electioneering communications to 
disclose the names of all contributors who contributed $1,000 
or more to the group, the FEC's 2007 rule, by contrast, 
narrowly restricts that disclosure requirement. It only 
requires disclosure if the donor gave the funds ``for the 
purpose of furthering electioneering communications.'' Under 
the FEC's rules, donors to 501(c)(4) groups simply refrain from 
designating their contributions to the groups for any 
particular purpose and, therefore, evade entirely these McCain-
Feingold law donor disclosure requirements.
    Last year, Representative Van Hollen sued the FEC, 
challenging this 2007 rule. And several weeks ago, he prevailed 
in his challenge with a favorable decision from the Federal 
District Court. However, an appeal is pending, and the FEC is 
unlikely to act on this court order any time soon. The Campaign 
Legal Center is very proud to be part of Representative Van 
Hollen's legal team, and we plan to continue fighting on his 
behalf in the courts.
    The Campaign Legal Center urges Congress to pass the 
DISCLOSE Act of 2012 to close these disclosure loopholes, to 
address these problems that have been made possible by the 
FEC's regulations, as well as by holes in existing statutes. 
The IRS itself has a role to play in this as well. The IRS's 
faulty interpretation of the tax code has made 501(c)(4) 
organizations attractive vehicles for spending these millions 
of dollars in election ads while shielding their disclosures.
    I am happy to talk further about the tax laws to the extent 
that it interests you, and I thank you for this opportunity 
again to testify before you today.
    [The statement of Mr. Ryan follows:]

   Testimony of Paul S. Ryan, Senior Counsel, Campaign Legal Center. 
  Before the Committee on House Administration Congressional Forum on 
                    Campaign Finance, April 18, 2012

    Distinguished committee members, thank you for this opportunity to 
provide my views on significant changes that have occurred in campaign 
finance law and practice over the past two years, since the Supreme 
Court's landmark decision in Citizens United v. Federal Election 
Commission (FEC) and the D.C. Circuit Court decision built upon it, 
SpeechNow v. FEC.
    The Campaign Legal Center (CLC) is a nonpartisan, nonprofit 
organization founded in 2002 that works in the areas of campaign 
finance, elections and government ethics. The Legal Center offers 
nonpartisan analyses of issues and represents the public interest in 
administrative, legislative and legal proceedings. The Legal Center 
also participates in generating and shaping our nation's policy debate 
about money in politics, disclosure, political advertising, and 
enforcement issues before the Congress, the FEC, the Federal 
Communications Commission (FCC) and the Internal Revenue Service (IRS). 
The Legal Center's President is Trevor Potter, former Chair of the FEC, 
and our Executive Director is Gerry Hebert, former acting head of the 
Voting Section of the Civil Rights Division at the Department of 
Justice. I serve as Senior Counsel at the Legal Center and have more 
than a decade of experience practicing election law.
                     citizens united and speech now
    The Supreme Court in Citizens United based its decision to unleash 
a flood of corporate money into U.S. election on two faulty 
assumptions. First, the Court wrongly assumed that such funds would be 
spent ``independently'' of candidates and, therefore, could not give 
rise to corruption or the appearance of corruption. Second, the Court 
assumed that the source of such funds would be disclosed, permitting 
``citizens and shareholders to react to the speech of corporate 
entities in a proper way'' and enabling the ``electorate to make 
informed decisions and give proper weight to different speakers and 
messages.''
    Several months after the Citizens United decision, the Supreme 
Court's faulty assumptions were compounded by the D.C. Circuit Court of 
Appeals in SpeechNow, when it relied on Citizens United and held that 
if independent expenditures cannot give rise to corruption, then 
contributions to groups making such expenditures cannot be limited. The 
SpeechNow decision gave birth to ``Super PACs.''
    I welcome the opportunity to discuss with you today the Citizens 
United Court's faulty assumptions and how they are playing out in the 
elections currently underway. Specifically, I will detail how current 
laws and regulations, combined with a dysfunctional FEC, have made this 
year's elections a ``Wild West'' of money in politics.
                               super pacs
    The ability of Super PACs to accept unlimited contributions, 
including contributions from corporations and labor unions that had for 
decades been off-limits for federal political committees, poses a 
serious threat of corruption in U.S. elections. Notwithstanding the 
Supreme Court's promise that the corporate money it was unleashing 
would be spent independently of candidates, current laws have been 
interpreted by the FEC to allow very close relationships between Super 
PACs and candidates.
Coordination Rules
    Congress, in passing the McCain-Feingold law in 2002, ordered the 
FEC to rewrite its long-ineffective coordination rules. The FEC's 
coordination rules (11 C.F.R. 109.21) responding to the mandate of 
Congress were woefully, and some would argue intentionally, inadequate. 
They have twice been invalidated by federal courts in two separate 
lawsuits brought by former Representatives Shays and Meehan over the 
past decade and remain ineffective today.
    Many assume that the coordination rules regulate and restrict 
general interaction between candidates and outside groups, but instead, 
current coordination rules regulate only discreet expenditures--
discreet ad buys, for example--made by outside groups. Current 
coordination rules accommodate close personal relationships and regular 
interaction between candidates and individuals operating Super PACs 
wholly dedicated to electing those candidates. Indeed, the most 
prominent Super PACs today are operated by friends and former employees 
of the candidates they support. And we have seen prominent funders of 
Super PACs closely involved with candidate campaigns.
Solicitation
    The McCain-Feingold law prohibits candidates and officeholders from 
soliciting unlimited funds, as well as corporate and union funds in any 
amount--so-called ``soft money''--in connection with any election.
    However, last year the FEC nonsensically ruled in an advisory 
opinion (AO 2011-12, Majority PAC) that candidates and their staff may 
attend, speak and be featured guests at Super PAC fundraising events 
without violating the soft money solicitation ban--so long as they do 
not make the actual pitch for unlimited contributions.
Threat of Corruption
    The FEC's failure to effectively regulate soft money solicitation 
and coordination between Super PACs and candidates has allowed the rise 
of candidate-specific Super PACs operating as shadow campaign 
committees fueled by soft money. The close relationships between Super 
PACs and candidates fall far short of the ``independence'' likely 
envisioned by the Citizens United Court. And unlimited contributions to 
candidate-specific Super PACs pose precisely the same threat of 
corruption posed by unlimited contributions directly to candidates.
                          501(c) organizations
    The Citizens United Court's second faulty assumption was that 
disclosure laws would provide voters with the information needed to 
hold corporate America accountable for its political activities and to 
make informed decisions on election day.
    Section 501(c)(4) organizations like Crossroads GPS, as well as 
501(c)(6) organizations like the U.S. Chamber of Commerce, will likely 
spend hundreds of millions of dollars on election ads this year without 
disclosing their donors. Indeed, such tax-exempt corporations will 
likely play an even bigger role in this year's elections than Super 
PACs--precisely because they offer donors anonymity.
    This explosion in use of such tax-exempt entities to evade campaign 
finance disclosure laws was entirely predictable at the time of the 
Supreme Court's decision in Citizens United.
FEC-Created Disclosure Loopholes
    Back in 2007, the FEC promulgated a rule (11 Sec. C.F.R. 
Sec. 104.20(c)(9)) gutting the McCain-Feingold law's donor disclosure 
requirement for ``electioneering communication.'' Whereas the statute 
(2 U.S.C. Sec. 434(f)) requires groups that spend more than $10,000 in 
a year on electioneering communication to disclose the names of ``all 
contributors who contributed . . . a $1,000 or more'' to the group, the 
FEC's rule only requires disclosure if the donor gave their funds ``for 
the purpose of furthering electioneering communications.'' Under the 
FEC's rule, donors to 501(c)(4) groups have simply refrained from 
designating their contributions for the specific purpose of funding 
electioneering communications and, therefore, have evaded disclosure.
    Last year Representative Van Hollen sued the FEC challenging this 
2007 regulation and, several weeks ago, prevailed in his challenge 
before a federal district court. However, an appeal is pending and it 
is unlikely that the FEC will act anytime soon to comply with the 
court's order. The Campaign Legal Center is proud to be part of the 
legal team representing Representative Van Hollen.
    A similar hole exists in the disclosure law and regulation 
pertaining to ``independent expenditures'' (2 U.S.C. Sec. 434(c)(2)(C) 
and 11 C.F.R. Sec. 109.10(e)(1)(vi)).
    The Campaign Legal Center urges Congress to enact the DISCLOSE Act 
of 2012, which would close these loopholes and dramatically improve our 
federal campaign finance disclosure laws.
Tax Law Disclosure Loopholes
    Section 501(c)(4) of the Internal Revenue Code establishes tax-
exempt status for ``[c]ivic leagues or organizations not organized for 
profit but operated exclusively for the promotion of social welfare. . 
. .'' (26 U.S.C. Sec. 501(c)(4)). Internal Revenue Service (IRS) 
regulations make clear that spending to influence candidate campaigns 
does not constitute ``promotion of social welfare.'' (26 Sec. C.F.R. 
Sec. 1.501(c)(4)-l(a)(2)(ii))
    The courts, however, have held that section 501(c)(4) organizations 
are permitted to engage in an ``insubstantial'' amount of activities 
that do not further their exempt purposes--including candidate election 
intervention.
    The IRS has interpreted these court decisions allowing 
``insubstantial'' candidate election activities by 501(c)(4)s to allow 
such organizations to intervene in candidate elections as long as such 
campaign activities do not constitute the ``primary'' activity of the 
organization. (26 C.F.R. Sec. 1.501(c)(4)-1(a)(2)(i))
    These regulations are commonly interpreted by practitioners to 
allow section 501(c)(4) organizations to engage in substantial 
candidate election intervention--as much as 49 percent of the 
organization's activities--so long as such activity does not constitute 
the organization's ``primary'' purpose.
    Importantly, section 501(c)(4) groups are not required by tax law 
to disclose their donors to the public. Consequently, 501(c)(4) groups 
have become attractive vehicles for spending millions of dollars on 
election ads without having to reveal the identities of donor who would 
rather stay hidden from public scrutiny.
    Many newly-created 501(c)(4) groups--including Crossroads GPS, the 
American Action Network, Americans Elect and Priorities USA--clearly 
have the overriding purpose of influencing candidate elections and 
should be deemed ineligible for their claimed tax-exempt status under 
section 501(c)(4).
    The Campaign Legal Center urges Congress to amend the federal tax 
code to make clear that 501(c)(4) groups may not engage in more than an 
``insubstantial'' amount of candidate election spending, and defining 
``insubstantial'' using a bright-line ceiling on campaign expenditures 
of no more than 10 percent of an organization's total annual 
expenditures.
                               conclusion
    Thank you for the opportunity to testify before you today.

    Mr. Gonzalez. Well, we thank the witnesses. We are going to 
proceed with 5 minutes of questioning from the Members that are 
up here right now, and I will start by recognizing my 
colleague, Mr. Brady.
    Mr. Brady. Thank you, Mr. Chairman, but I would have 
yielded my time to Leader Pelosi.
    No, just real quickly--and this is for all of you. The 
DISCLOSE Act, do you think that is a good first-step that 
closes the information gap between unions and the membership 
organizations, as opposed to corporations?
    And the reason why I make the distinction, I am a union 
member, and I am still a current union member of two unions. 
And every donation that I make, I vote on. I get a chance to 
vote when I have our meetings, and I submit the request of 
people or whoever it may be, the organization that asked for 
donations, and we get a chance to vote on it. And a membership 
organization is the same.
    Corporations, they just do what they want to do with any 
money that they collect. And the problem I have with that is a 
pen is a company. TVs are companies. Water is companies. These 
guys, God knows, are companies--watches, jewelry, clothes. They 
are all companies that we all support, and we buy items from 
them, and they make a profit.
    And then they can use that money, their profit or the money 
that we give them, they can now use that against me. They can 
use that against any one of my colleagues, and I have a problem 
with that. I have a problem with that lack of transparency.
    Now talking about transparency, as our Speaker--our 
Majority Leader [sic]--just said, that they had asked us, and 
me as the Chairman of this Committee, for us to have hearings 
on the Citizens United and DISCLOSE Act. And you know, there 
are a lot of things above my pay range, and naturally, I had to 
go to my Speaker at the time, Speaker Pelosi, and ask her if we 
should do that. And she said, ``Yes, give them as many as they 
want.'' They wanted three.
    We have on our committee, myself, Mr. Gonzalez, Mrs. 
Lofgren, asked for a hearing in the same exact way they asked 
us for hearings when we were the majority, and they said no. 
And now the current chair won't put our pretty faces on TV and 
let us--so that the whole Congress, while we are sitting here 
waiting for a vote, that they could just watch and listen and 
form an opinion on what we are hearing here today from all of 
you.
    So, you know, that does upset me and bother me a little bit 
because, again, it is probably above our chairman's pay-grade. 
But it is not above the leadership that sanctions it or not 
sanctions us to have these hearings.
    So, do you think the DISCLOSE Act, back to my question, is 
a good first step into closing that gap between our union 
membership and membership organizations, as opposed to our 
corporations that are allowed to be in obscurity and do 
whatever they want nontransparent? Anyone who would like.
    Ms. Youn. I would be interested in addressing that. I am 
not prepared to talk about the DISCLOSE Act, but there is a 
very interesting asymmetry because the Supreme Court in 
Citizens United pretends it is treating corporations and unions 
the same. And I think Representative Brady is absolutely 
correct in pointing out that, in fact, they are not the same.
    That the Supreme Court, among others, has been absolutely 
vigilant in making sure that every dollar of member--of union 
member funds that goes toward political spending was put there 
voluntarily and that members who are not interested in their 
money being used for political spending have an opt-out.
    Whereas corporations, the money that they are using is not 
voluntary. When I give my money to my 401(k), I am not saying 
that whatever corporate manager has their hands on my money has 
the right to use that to support any political candidate that 
they like.
    So, yes, unions and corporations can both spend out of 
their general treasury funds. But the asymmetry is in amassing 
those general treasury funds. Unions are required to use only 
voluntary contributions, whereas corporations are not.
    Mr. Ryan. I would also like to respond. The Campaign Legal 
Center strongly supports the DISCLOSE Act of 2012. We think it 
would do great things to improve transparency in U.S. 
elections. When it comes to treatment of or spending by labor 
unions versus for-profit corporations, nonprofit corporations 
like these 501(c)(4) groups, it is the thresholds for 
disclosure that are intended to capture the information that 
matters: big donors.
    In the DISCLOSE Act--I believe the donor disclosure 
thresholds in the DISCLOSE Act of 2012 are $10,000. So it is 
only when a person or an entity, a corporation, gives money to 
the spender in excess of that $10,000 threshold that they get 
disclosed by the spender as a donor to the group. I think that 
is a good thing.
    I don't think disclosure thresholds should be so low as to 
capture every dollar coming into these groups. It may place an 
unreasonable burden on groups that are funded or driven 
principally by a huge number of small donors. They don't worry 
me in terms of democracy. Large numbers of small contributions 
aren't the problems here. It is small numbers of huge 
contributions swaying elections that are-- that is what 
matters. That is what needs to be disclosed.
    Mr. Ornstein. Just one quick comment. And I also support 
the DISCLOSE Act, but I would take it further.
    The campaign monies given by corporations are nondeductible 
business expenses. If I am a shareholder in a corporation, I 
ought to know when that company is spending money that is not 
for legitimate business purposes directly that would be 
deductible.
    And it seems to me that two things ought to happen here 
that perhaps you could participate in. One is to urge the 
Securities and Exchange Commission to promulgate a regulation 
that requires in annual reports that all nondeductible business 
expenses are disclosed. And the second is to talk to major 
shareholders, and that includes big pension funds, and have 
them go to corporations and demand that it is in their interest 
as shareholders to know how they are spending their money that 
doesn't get a tax deduction.
    Mr. Brady. Thank you. And thank you all for being here 
today, and thank you, Mr. Chairman.
    Mr. Gonzalez. Thank you very much, Mr. Brady.
    I would recognize Mr. Price for 5 minutes.
    Mr. Price. Thank you, Mr. Chairman.
    Thanks to all of you for outstanding testimony in every 
case. Very, very well done, and very helpful.
    We all could multiply examples here of how far this has 
gone already and where it may well take us in the future. On 
March 30th, This American Life ran a show entitled ``Take the 
Money and Run for Office.'' And, during the second segment, the 
show focused on a California race--actually, the race of the 
chairman of this committee.
    Three weeks before the election, the Times ran a piece 
calling incumbent Dan Lungren ``endangered.'' Guess what 
happened. The next week, Karl Rove's Super PAC, American 
Crossroads, dumped $680,000 into that race in the form of a 
media buy, and we all know the result.
    I had a similar experience right next door in North 
Carolina, my colleague, Bob Etheridge, in the Second District. 
Hundreds of thousands of dollars parachuted into that race in 
the last 2 weeks, and he lost by a very few votes. And, 
needless to say, not one dime of that money was spent on 
anything but negative ads.
    So the examples are multiplying. The future is before our 
eyes, I think, in what is happening this year, including the 
Republican presidential primary. So, I would like to ask a 
couple of questions, which, maybe, help us understand the 
gravity of this trend and some of the consequences.
    All of you, in your own way, have spoken about corruption 
or the appearance of corruption and about the otherworldliness 
of the court's reasoning about it. I wonder about the effects 
on this institution and the effects on the functionality of 
American politics and American government.
    Norm Ornstein, I want to ask you to start because I know 
you have thought about it, but I expect all of you have. How is 
this money spent, and in what ways is it spent differently from 
money spent by other kinds of political groups? Are these ads 
different? Are they more negative? Are they more personal? Is 
there any study of this? I mean, we all have our impressions. I 
wonder if those impressions are confirmed.
    And what effect does this avalanche of negative ads from 
undisclosed sources--what effect is that likely to have on what 
we all know is an overly charged, overly polarized political 
environment that we're already dealing with, with the 
dysfunctionality of this institution, our inability, our 
failure, to come to grips with the major issues of the day?
    We can't even pass a transportation bill! We can't pass an 
education reauthorization. And we now aren't even going to be 
able to pass appropriations bills because that has blown up. We 
are not functioning well, and the American people are not being 
well served.
    And Norm, I know you have thought about the connection of 
campaign financing, the way campaigns are paid for, and I would 
like to have you elaborate on it.
    Mr. Ornstein. Thanks.
    Let me start by saying that one of the most significant and 
commendable provisions of the Bipartisan Campaign Reform Act 
was the ``stand by your ad'' provision that David Price 
authored. I think it has now become familiar to most Americans, 
and it has changed the nature of campaigning. It has changed 
those commercials.
    When a candidate has to stand up in a television commercial 
and say to the camera, ``I am fill-in-the-blank, and I stand by 
this message,'' it makes a difference. And if you have watched 
any of the ads that have been out, the Super PAC and 501(c)(4) 
ads in the presidential campaign where the disclaimer at the 
end is, ``This message paid for by Americans for a Better 
America, unaffiliated with any candidate or campaign'', what 
you see--and we need more systematic research, but it is pretty 
evident on the surface--is scorched earth.
    Lies have now become the coin of the realm. Viciousness, 
when you don't have to connect yourself to it. And of course, 
the perfect opportunity for a candidate who is intimately 
connected to the Super PACs to say, ``Well, I had nothing to do 
with that.'' It makes it worse.
    I think it is demeaning the discourse even more. We live in 
a rough and tumble world. Shock to cut through the cacophony is 
going to be there all the time. But the ``stand by your ad'' 
provision at least puts some broad boundaries around this, and 
those are going away.
    And one of the things that I fear so much is these groups 
are coming in with so much money that they can go to television 
and radio stations and roadblock all the prime spots by saying, 
``I will give you retail or 25 percent over retail.'' And 
candidates are going to be relegated to the second tier. They 
are going to be in the AAA ballparks rather than in the best 
places.
    And that is going to make it worse. What does all that do? 
It accentuates the tribal politics. This scorched earth 
campaign is going to make it that much harder to find 
bipartisan compromise when we come back. It is going to make 
voters view even less favorably all of those who are engaged in 
politics.
    I don't know how much lower we can sink below the 9 percent 
where we are now in approval, or 9 to 11 percent, but we have 
got a little bit of running room there. And the harsh negative 
views will increase, and that means the legitimacy of decisions 
that are made will come under challenge.
    So this is not just a matter of some of the really serious 
elements that we made here, that we are back to the gilded age 
and you have got people coming in, swooping in and spending 
money and getting their way in policy. It also challenges, it 
seems to me, the fundamental legitimacy of the system. And how 
members of the court who made this misguided decision can't see 
some of what they have wrought is beyond me.
    Mr. Ryan. I would love to add to Norm's comments because it 
is not--stand by your ad requirements are a great thing. But 
they are not enough. One of the central flaws in the Citizens 
United decision was this notion that corporations are just like 
humans. Corporations aren't just like humans.
    And these (c)(4)s that are going to be spending tens or 
hundreds of millions of dollars in this year's elections on 
attack ads--and they will be doing the dirty work of 
candidates, they will be doing the attack ads--they can 
dissolve overnight. They can dissolve at the drop of a hat.
    And those of us sitting in this room today, God willing, we 
will be here in December. We will be alive. We will be held 
accountable for the actions we take between now and then. That 
can't be said for these 501(c)(4) and other types of outside 
groups that, again, can dissolve with the filing of some 
paperwork with a secretary of state's office at the drop of a 
hat. That is a big problem.
    Ms. Youn. Representative Price, I also wanted to mention an 
example. There is visible negative campaigning, and I think the 
available social science research has shown that Super PACs 
overwhelmingly engage in these negative attack ads, but there 
is also invisible negative campaigning. And there is a terrific 
example from your home state of North Carolina that is 
mentioned in the dissenting opinion of a case called Duke v. 
Leake.
    And in that case, there is a lobbying--there is 
organization called ``Farmers for Fairness''. This is in the 
North Carolina state legislature, which allowed these kinds of 
independent expenditures prior to Citizens United. And Farmers 
for Fairness supported a particular farm subsidy, and they knew 
that the legislature was going to consider this farm subsidy.
    So what they did is they made up a whole campaign of attack 
ads against particular legislators they knew were the swing 
votes. They then took these ads to the legislators and screened 
them behind closed doors and said, ``These are the ads we will 
run against you if you do not support our position on this 
legislation.'' And some of these legislators changed their 
votes.
    Now that is not going to show up on any disclosure. That is 
not--you know, but that is just an example of the sort of a 
broader kind of corruption that is a threat to our system that 
I don't think the Supreme Court ever envisioned.
    Ms. Teachout. I am honored to answer. You were my 
Representative for 7 years. We are playing checkers now, and it 
is about to be chess. I mean, this hasn't begun yet.
    So, right now, we are thinking about ads, but we are in a 
technology and data era. So it is not just television ads. It 
is using the massive databases and access to data that some of 
the largest companies in the world have.
    It is not just going to come out in the form that we 
recognize of the last 30 years of campaigning. We don't know 
exactly what it is going to look like. But we know that we are 
just beginning, and the level of sophistication in both threat 
and promise at every level of campaigns will be different.
    Who is going to run? Maybe we need somebody in this 
district because of the nuclear energy industry. Why don't we 
just plop down a promised several million dollars and get our 
candidate in the primary? This kind of money in primaries in 
local races is extraordinary.
    The conversations have been at the presidential level, but 
that is the least concerning. It is certainly much--small 
amounts of money have a much larger impact. And it is happening 
at the same time you see this radical concentration in economic 
power.
    So when Senator Kennedy proposed that no company be allowed 
to merge larger than $2 billion in 1978, we are talking about a 
much more decentralized economic scene. Right now, it is much 
more concentrated, and we know the most concentrated industries 
spend the most on politics.
    So you see a combination of concentrated economic power, 
unlimited potential for use in the political sphere, and you 
know, I am a deep patriot. I love this institution, and I love 
the promise of it. But it is very rare in human history to have 
a truly representative government. It is not the default state.
    The default state is, as you know from your own political 
science work, the default state is something much more like a 
kind of combination of oligarchic power, where there is 
concentrated financial power really dominating politics. And 
there is this window here before the full threat of Citizens 
United is realized, and it is so important to act quickly.
    Mr. Price. Thank you.
    Mr. Gonzalez. Thank you very much. Mr. Van Hollen for 5 
minutes.
    Mr. Van Hollen. Well, thank you. Let me start by thanking 
you, Mr. Gonzalez and Mr. Brady, for organizing this forum on a 
central issue to the integrity of our democratic process.
    I also want to thank Leader Pelosi and my colleagues here 
on the panel and others who have focused on this issue, and all 
of you who just gave wonderful testimony about the urgency and 
importance of this issue. And I do think it is an absolute 
travesty that Republicans have refused to hold a hearing on 
this very important issue that is fundamental to the future of 
our democracy.
    I think, as everybody knows, we were able to pass the 
DISCLOSE Act several years ago. It went over to the Senate, got 
59 votes. [sic] In fact, in one of the terrible sort of 
unfortunate ironies of history, had Senator Kennedy not passed 
away, the DISCLOSE Act might well be the law of the land today, 
would have provided the 60th vote. But apparently, our 
Republican colleagues want to keep people in the dark when it 
comes to hearings, just as they want to keep them in the dark 
when it comes to disclosing the sources of a lot of the 
expenditures in these campaigns.
    Now you have all made very keen observations about Citizens 
United. As Mr. Ornstein said, some of the conclusions that were 
reached there could only be made by people who had no clue as 
to how the American political system was operating in the 20th 
and 21st centuries, and it is going to come back to haunt us 
unless we act quickly to fix it.
    I support a multi-pronged strategy. I think we have to 
proceed on all fronts. I also believe we have to engage in some 
political triage. We have to focus on where we are likely to be 
most successful in the short term as we also proceed 
immediately on other fronts.
    I do think disclosure is essential, and I think the 
testimony today indicates that there is lots of money pouring 
into the system today that would not come into the system if 
those individuals and corporations and entities knew that their 
identities would become public. We have seen an awful lot of 
money laundering going on. And the DISCLOSE Act is intended to 
get at exactly that. Trace the money laundering, require 
disclosure at all different sources and all different levels.
    And I think that we have a very sort of solid argument to 
take to the American people that, number one, voters have a 
right to know who is trying to influence the outcome of these 
elections. And therefore, we should end the secret money in 
politics, and that is what we are attempting to do.
    Now one of the cases, as you know, that may be taken up by 
the Supreme Court is the Montana case. I am interested in your 
views on what opportunities there may be there or not to make 
our case.
    Mr. Ryan, let me thank you and the center for your activity 
and efforts not only on behalf of DISCLOSE. And Mr. Ornstein, 
thank you for your support for DISCLOSE and others, but also 
for your efforts in the FEC case. I share your view. It was an 
important measure, important step.
    But we all know how long the processes can be dragged out 
in the FEC and through the court system, and it just goes to my 
earlier point that we need to proceed on all fronts and we need 
to do it in an urgent manner. And I am interested in all of 
your views on whether or not the Montana case provides any 
additional opportunity for us to revisit these issues?
    Mr. Ryan. I am happy to respond to that. Happy to respond 
to that. First, the Campaign Legal Center, my colleagues and I 
are right now working on a brief to be filed in that case on 
behalf of a bunch of transparency, pro-transparency, pro-
campaign finance reform organizations from around the country.
    Justice Ginsburg included a statement in a stay order that 
the court issued a couple of months ago, indicating that at 
least some members of the court are perfectly ready and willing 
to revisit the court's decision in Citizens United. I won't 
predict whether or not there will be five or six votes on the 
court or more to change direction on Citizens United. But the 
door is open a crack, and we are going to take our best shot at 
it.
    There are a bunch of other very skilled attorneys and 
advocates from around the country, including the AG's office in 
Montana, that are working hard on that case. So I am hopeful, 
but obviously, no guarantees.
    Mr. Ornstein. Mr. Van Hollen, let me step back for a second 
and say that when we were deep in discussions over BCRA and 
putting it together, there was a great deal of consideration 
made to making sure that this was evidence based.
    We had a lot of work done on electioneering communications 
that were transparent campaign ads, on ads financed by soft 
money that was supposed to be for party-building activities 
that never mentioned the party, that were just aimed at 
attacking candidates. There was reasoning that went into that 
decision by Congress, and that was, I think, taken seriously by 
the court when it upheld the Bipartisan Campaign Reform Act.
    Reading Justice Kennedy in the Citizens United decision 
with a not only redefining corruption in the narrowest way, 
which is dangerous and unconnected to reality but, with no 
evidence at all, saying that independent money would have no 
connection to corruption or the appearance of corruption or it 
wouldn't matter. And seeing what Richard Posner, a very well-
respected conservative jurist, has written now suggesting that 
that really doesn't make a lot of sense, and then looking at a 
Montana law that uses evidence from Montana to say we don't 
want corporations doing this because it corrupts us, I hope 
that there are four justices who will bring this up, bring it 
forward, and then force the court at least to acknowledge that 
evidence doesn't matter to them.
    Ms. Teachout. Thank you for all your work on this, and I am 
delighted about the multi-pronged approach. I am always going 
to be pushing for prong two. But, you know, there is a, you 
know, ``What is the 1 percent hiding?'' There is a real sense 
of both privilege and secrecy together it is important to 
fight.
    I do think it is important to demonstrate to the public 
that this Congress knows that transparency isn't enough. 
Montana is a great question. It is a really tricky one. And you 
know, I wrote an article called ``Facts in Exile'' about the 
Supreme Court sort of treating facts as this extra, you know, a 
luxury.
    And whether or not, in court or out of court, the Montana 
case provides an opportunity to talk in a really public way 
about the water cooler sense of corruption that we all 
understand and what we mean when we say your minds are oriented 
not towards the public. Your minds are oriented towards the 1 
percent.
    Ms. Youn. I think the Montana case is going to be, I think, 
absolutely fascinating because, as some of you may know, it 
takes four justices to grant cert to hear a case in its 
entirety, and I think many of us--the Brennan Center is also 
working on a brief in the Montana case--and I think many of us 
would welcome the chance to put on the record, you know, 
exactly the sort of factual evidence that Justice Kennedy 
disregarded when he blithely stated, ``Oh, independent 
expenditures pose no risk of corruption.''
    On the other hand, the flip side of that is it generally 
takes five justices to--which could be the same majority as in 
Citizens United--to grant a summary reversal of a lower court 
decision. And I think we are--you know, we are very much in a 
state of Supreme Court practice mystery as to whether the four 
justice rule is going to trump the five justice rule or exactly 
how this is going to work out.
    But in any case, as was referenced earlier, in the 
McConnell decision, the court considered hundreds of thousands 
of pages, including depositions taken by some of my colleagues 
at the Brennan Center, talking about what corporate CEOs 
expected when they gave soft money contributions and the way in 
which contribution-- the way in which corruption can function 
below the surface.
    The Supreme Court did not take any of that evidence into 
account. I know that lots of the record in McConnell v. FEC was 
sealed for privacy purposes at the time of that decision. As 
far as I know, that has never been unsealed.
    There is a lot of existing evidence and there is a lot of 
new evidence from this new super PAC phenomenon that we 
certainly deserve--believe deserves a public hearing.
    Mr. Gonzalez. Thank you very much, Mr. Van Hollen.
    Mr. Ellison for 5 minutes.
    Mr. Ellison. Thank you, Mr. Chairman.
    Also thanks to the leader and all of our witnesses today.
    I just want to say for the record that earlier today we had 
a press event that involved over 20 community organizations 
that came together with several Members of the U.S. Senate, 
double digits of House Members, all coming together around the 
idea of an amendment strategy.
    On June 11th, there is going to be a Resolution Week in 
which municipal leaders all over this country are going to 
introduce resolutions to say that we have got to flip Citizens 
United. So there is a grassroots movement going on here, and it 
is very exciting, which leads me to my question.
    I can't--I have got to believe that no matter what side of 
the political spectrum you may come from--liberal, 
conservative--the idea that your little microphone that all of 
us are issued as a citizen is going to be drowned out by 
speakers that could, you know, Mr. Ornstein put it better than 
I can. But they could, you said, ``shake the seats in Nationals 
Stadium'' because somebody has so many more dollars than 
another person. This must be something that there is broad 
cross section of support across the country.
    What are the people saying about the need for disclosure, 
and what are the people saying about the need for amendment? 
And also what are they saying on the various sides of the 
political spectrum? I mean, what are conservative groups saying 
about this stuff? I am sure they have got to be concerned about 
it.
    Mr. Ryan. Our impression, from reading public opinion 
polls, is that the public overwhelmingly supports disclosure of 
money in politics, overwhelmingly supports it. And I think that 
support spans the political spectrum.
    When you come to the actual organizations, the actual 
Members of the House of Representatives, for example, Members 
of the Senate, we have seen flip-flopping, unfortunately, in my 
view, from some Republican members who for years and years, for 
decades, told the story of ``All we need is disclosure. Let us 
get rid of all these limits. All we need is disclosure.''
    I was never sold on that because as soon as you allow 
incorporated entities into the system, disclosure becomes very 
difficult to achieve and sustain. But these same individuals 
who--Senator McConnell, for example, appeared on Meet The Press 
and went on and on about--and this was fighting against the 
McCain-Feingold law--``All we need is disclosure. Let us get 
rid of all these limits. Let us not pass this McCain-Feingold 
law.''
    Fast forward a decade. Many of the substantive limits, 
unfortunately, have been struck down, and they are changing 
their tune. And I believe that some of the Republican-oriented 
organizations here in Washington and nationally are following 
suit and changing their tune and realizing dumping secret 
influence-buying money into the system is much to their liking.
    So, again, that is why we have seen trouble with the 
DISCLOSE Act in 2010, why we are seeing trouble with the 
DISCLOSE Act now in 2012. We need to hold folks accountable for 
their historical positions on these issues. Nothing has changed 
except their ability now to get away with legalized money 
laundering.
    Ms. Youn. I think one of the great things about Super PACs 
is they are such an easy phrase to remember that people now 
know what you are talking about when you are talking about 
campaign finance reform. I think, thanks to Stephen Colbert, 
but thanks to a lot of, you know, media coverage of this.
    And so, in my written testimony, I reference some of the 
more recent polling that says that 67--no, 69 percent of all 
Americans now support banning Super PACs, and that support 
ranges across the political spectrum. We are talking about 
majorities of Republican voters. We are talking about 
majorities of Democratic voters and independent voters.
    So I think that what the people want and what the 
leadership want may tend to diverge here. But I think that we 
can only take advantage of the momentum that is caused by this 
very high-profile unraveling of our campaign finance system.
    Ms. Teachout. Yes, I want to echo that. I mean, there is 
extraordinary support for a public funding system now, even 
when the alternate arguments are presented. Extraordinary 
support for disclosure. But there is also extraordinary room 
for leadership.
    But, if Members of Congress do not themselves use their 
platform to make a fight out of this and make the fight clear, 
there is a softness in the support. People are looking for how 
to understand the post-Citizens United, post-financial collapse 
world. You saw the shifting numbers of support for Occupy Wall 
Street with the initial extraordinary, high levels of support 
and then an absence of national leadership on defining what 
this new economic and political system is going to look like.
    So there is both high levels, but there is also a lot of 
movement, which is why public clear expression of what 
government should look like, who people should be responsible 
to, what is possible in Congress is important because, 
otherwise, you are going to lose people. You can name an act 
anything you want, and people aren't going to believe it 
anymore.
    So this kind of leadership is really key. Otherwise, I 
think you are not going to see the support without--without 
making a strong case.
    Mr. Ornstein. Let me just make a few points. First, you 
can't underestimate the impact that tribal politics have now. I 
mean, I watched as the DISCLOSE Act came up in the Senate, and 
I had worked with Olympia Snowe on what was the Snowe-Jeffords 
amendment that really was the provision singled out by the 
court in Citizens United.
    And to watch Senator Snowe, Senator Collins, Senator 
McCain, and others who had supported reform, all join together 
with the rest of their colleagues to vote against this was 
stunning. But it is a reflection of Mitch McConnell's ability 
to keep his tribe together and to make it a top priority and, 
of course, to get everybody to reverse course and now say that 
disclosure doesn't matter. So that is one important point to 
make.
    The second point is that public opinion does support 
disclosure and change, but there are a lot of things that 
overwhelming majorities of Americans support and never go 
anywhere. I think we are going to see a change in this coming 
couple of months. If you were in a state where it is 
competitive in the presidential contest, you have got a 
competitive Senate race, and maybe something else going on, the 
months of September and October, there will not be a commercial 
on television that will not be a vicious attack ad.
    And for an awful lot of Americans, you won't be able to 
escape it. And it is going to be a little bit like a goose 
being force-fed to get the fois gras. You are going to be 
sitting there, and this stuff is just going to come down your 
throat whether you like it or not. And I think we are going to 
see a very substantial reaction. We will have to seize on it.
    And finally, I would say, we are not going to get it from 
leadership of conservative organizations. But I actually think 
on this issue and on many others, including some of the ethics 
questions, that some of these Tea Party colleagues of yours 
have no reason to be supportive of the huge money coming in 
that is going to sometimes drown them out when you get a 
different establishment setting.
    They are populists in a different way. And it is worth 
talking to them, maybe individually, and perhaps building some 
grassroots support for some changes here. It is not going to 
come easy, but it is going to be easier to get than it will 
coming from the usual suspects on that side.
    Mr. Ellison. Any time for a quick follow-up, Mr. Chairman?
    So now I want to ask you about shareholders. I think this 
is an interesting group to understand how they see this because 
I think this was pointed out several times, you know, when you 
send your money to your 401(k), somebody is using that money to 
say something that you have no interest in them saying. Yet if 
you were in a union, as Representative Brady pointed out, you 
would at least have some say on that.
    They are fighting us on ``say on pay'' and golden 
parachutes, and yet shareholders at Citi[group] rejected a 
compensation package. So I guess my question to you is, is 
there any energy, anything going on among shareholders saying, 
``Wait a minute, you spend my money on stuff. You are supposed 
to be trying to make me some money to take care of my 
retirement. Why in the world are you beating up on this person 
and that person and the other? It is not helping me out.''
    Care to address this issue?
    Mr. Ryan. There is some work being done, some important 
work being done on behalf of shareholders. The SEC was 
presented with a rulemaking petition that was open for public 
comment, received widespread public comment that--urging the 
SEC to promulgate rules requiring improved disclosure of 
corporate political spending.
    Representative Capuano has introduced the Shareholder 
Protection Act, which has a national coalition of organizations 
advocating its adoption, its enactment, and that would 
provide--would require corporations to obtain affirmative 
approval from shareholders before making big corporate 
political expenditures.
    So work is being done. National coalition is working on it. 
Very important issue that you have highlighted.
    Ms. Teachout. I suspect this is where I am going to differ 
from some people on this panel. I do not happen to think that 
pursing the shareholder strategy is a good idea at this point. 
I do not think that--I think of it a little bit like Dodd-
Frank.
    The country is responding to Dodd-Frank, saying, ``You 
didn't do anything about too big to fail.'' I don't know if you 
have seen the recent polling around this. And at the time, 
there was a sense, ``Okay, no, we can manage our way. We don't 
have to--we can manage our way, and we can figure out 
something, and we will get credit for having figured out 
something.''
    This is bigger than shareholder protection. We actually 
have to restructure the way campaigns are funded. If you don't 
do that, everything else is a little bit baroque on the sides.
    At the same time, I also think that if you perfect the 
agency relationship between the shareholders and companies, 
that doesn't necessarily mean you see less funding. In fact, 
the rational company might spend a lot more money on campaigns 
than they do now, once they have really figured out this chess 
game.
    So I admire the creativity here, but I actually think that 
we should be focusing on the real game, which is how campaigns 
are funded and returning to pre-Buckley.
    Mr. Ornstein. I am not sure that that is--it is not the top 
priority, but I would disagree a little bit with Zephyr here. I 
actually think most companies, most public companies, don't 
want to do this. They did not react with anger at BCRA. They 
don't want to get caught in a couple of terrible dynamics.
    One is where you have a party shaking you down and 
basically saying, ``Whose side are you on?'' And, ``If you 
don't pony up the money, we are going to make you pay.''
    The second is the situation that we saw with Target and we 
are seeing now with ALEC, the American Legislative Exchange 
Council, you know, this group that basically has--talk about 
corruption--you know, come in with ready-made laws that 
lawmakers are perfectly happy to just channel right through and 
get something in return that a lot of companies gave to. And 
now it is when that is being disclosed and all of a sudden they 
realize that they paid for the ``stand your ground'' laws, they 
are saying, ``Whoa, I don't want to be a part of that.''
    So I believe that disclosure will change the role of a lot 
of public corporations. It is not enough, and the fact is that 
even with billionaires and individual money, it was very 
different before Citizens United when you, as an individual, 
had to go out there if you wanted to put large sums of money 
in, and do it all yourself. Where now, you can just give it to 
Karl Rove or give it to some other group, and they do all the 
work for you.
    So we need a lot more than that. We need a short-term 
strategy that isn't going to involve overturning Citizens 
United. We need a medium-term strategy that can be ready with 
the next product when that happens.
    Maybe we need the long-term strategy of looking at a 
constitutional amendment, although I would prefer to work in 
other ways. But you can't abandon any of those, and you can't 
abandon every avenue, whether it is the FCC, the FEC, the SEC, 
or the IRS, or legislation, or some of these other vehicles.
    Ms. Youn. I would just briefly like to address that. I 
agree that this is only a partial solution. For one thing, 
publicly traded corporations are only a very small part of the 
problem that we are talking about. But I do think that we do 
need to look at creative avenues to encourage corporate 
disclosure, you know, just for the sake of my 401(k) fund.
    And I think we are used to thinking of corporations as 
monoliths. Like, ``Oh, the corporation is spending money in 
politics, and they know about it all the way down.'' They often 
don't know about it. Often--there is no requirement that 
political spending be disclosed to corporate boards.
    There is a multinational pharmaceutical corporation that 
has become a leader on the shareholder disclosure front because 
they found out that one of its mid-level managers was spending 
corporate funds to support an openly racist candidate in 
Mississippi, and he was doing that without the knowledge of 
upper management. It is that sort of--you know, shareholder 
disclosure makes sense for a lot of reasons. It is not a 
solution to our current problems of money in politics, but it 
is something that is important to do in its own right.
    Mr. Gonzalez. Well, thank you very much. And the chair is 
going to recognize himself for 5 minutes, and thank you for 
your patience.
    But quickly, and I want to follow up on something that Dr. 
Ornstein pointed out is that some people may figure that there 
may be individuals on the other side of the aisle, they may not 
relate to the fears that we feel. Citizens United has truly 
diminished the role of the individual in the election of their 
elected officials.
    No one is really recognizing that. And here in Washington 
we are so caught in the middle of this thing and I am not real 
sure that we have ever gotten that message out.
    Now, I understand that an individual can work on my 
campaign, knock on doors, put up a sign, have the bumper 
sticker. They can also contribute because the way you 
communicate today, obviously, is an expensive thing. But there 
are limits as to what the individual can contribute to Charlie 
Gonzalez, if I were to be seeking reelection.
    Yet how--and it also impacts what happens in the future 
when candidates are thinking of running for office. And this is 
what I mean. Let us just say my good friend Keith Ellison--I am 
now a private citizen. I want to help Keith. I love Keith. So I 
want to contribute.
    So I am going to be limited to contribute X amount for the 
primary, X amount for the general election, maybe $5,000, as an 
individual. But if I have a whole lot of money, a lot of money, 
and I want to help Keith, what would you suggest would be the 
best way for me to do it, should this exact circumstance we 
find ourselves today on shell corporations, the Super PACs, the 
501(c)(4)s, what is the best way for Charlie Gonzalez, private 
citizen, to make all his money really felt because I want to 
help Keith Ellison?
    He is not going to coordinate anything with me. Maybe his 
former campaign manager may be running that Super PAC, but 
please don't draw any conclusions. What is the best way for me 
to get lots of money to support Keith in his reelection?
    Mr. Ryan. I would ask you whether or not you are willing to 
be disclosed publicly, whether or not you are willing to stand 
by this support. If you are willing to stand by the support, 
you can write an unlimited-sized check to a Super PAC, and that 
Super PAC can spend every penny that you give to that Super PAC 
to advocate Representative Ellison's election to office.
    You could, of course, go down to local TV or radio station 
or to the stations in Representative Ellison's district and 
make those ad buys yourself. You have been free as an 
individual for decades, forever essentially, to do that.
    But if you don't want to be disclosed for this support, 
then you identify a 501(c)(4) group. If one doesn't exist, you 
encourage some friends to create it, and you write your 
unlimited check to that (c)(4) group. You refrain from writing 
on the memo line of that check, ``Use this money to air ads for 
the reelection of Representative Ellison.'' You refrain from 
specifically designating your donation to the (c)(4) for any 
particular purpose, and you will remain undisclosed.
    The (c)(4), in turn, can spend your money, 49 cents out of 
every dollar you give it, on hard-hitting express advocacy ads 
urging the election of Representative Ellison. And will spend 
the other 51 cents on ads that are nearly as hard-hitting, sham 
issue ads that either attack an opponent on the basis of some 
issue, but certainly identify the candidates in the race, yet 
don't contain words of express advocacy and, therefore, don't 
fall under the rubric of ``candidate election intervention'' 
for tax law purposes.
    That is the way to do it. And it is your decision whether 
you want to remain anonymous or be disclosed.
    Mr. Gonzalez. Anyone else?
    Ms. Youn. What I find kind of touching about both your 
question and Paul's response is we are talking about this as if 
it is a hypothetical. But we already know--I mean, like, so the 
poster child of this campaign season so far has been Sheldon 
Adelson, who, as we all know, has given upwards of $10 million 
to support Newt Gingrich.
    But there are, you know--but there are two $10 million 
checks that were both written to Crossroads GPS, and we don't 
know the name of the person that was on those checks. There 
were two separate checks written for $10 million apiece. We 
have no idea who that person is or if it is even a person or if 
it is a major corporation behind this.
    I mean, this is already happening. This is an avenue that 
sophisticates have figured out. And Adelson, at least he is 
spending his own money. At least we know his name. I think the 
biggest problem is when they are not spending their own money, 
and we don't know their names.
    Mr. Gonzalez. Anyone else?
    Ms. Teachout. So I am going to--you know I am a law 
professor. So I am going to fight the hypothetical. These are 
wonderful answers, and I hope nobody hears them because they 
are good advice.
    But I just want to respond to something also that Norm 
suggested earlier. I think, at first, corporations--I would 
love it if we just stuck with the wealthiest individuals trying 
to figure this out. It is a terrible situation, but it doesn't 
deal with the real threat of concentrated power used 
strategically.
    We are 2 years in. I think it was Texas Home Builders who 
used--it was the first company that actually did itself as a 
company, using the ability to have independent expenditures. 
Two weeks ago, we had the first banking Super PAC because 
Congress doesn't know to be scared of the banks. It was in the 
press release, I believe.[]
    We are just at the beginning of strategic corporate action. 
And if they are then following the same strategy, now we are 
talking real money, and we are also talking money that has a 
particular ideological bent. So that you no longer see the 
range of ideological views that Americans hold.
    Mr. Ornstein. Let me answer your question in a couple of 
ways, and it will get also at Representative Price's question.
    If I am sitting there as a Member of Congress and I know 
that American Crossroads GPS, if the presidential contest 
doesn't turn out to be completely close, is going to turn all 
of its resources into House and Senate campaigns. And I also 
know there are going to be others out there, and I am worrying 
about somebody coming in at the end and spending $10 million 
against me, of course I am going to go out there and try and 
raise as much as I can in $2,500 increments. There are limits 
to that, especially because everybody else is going to be 
looking at the same individuals.
    So I am going to try and find a sugar daddy. I am going to 
look for somebody who will do for me what the others would do 
against me. And to get those, maybe you know a billionaire who 
they are ready to be tapped, if necessary. If not, there will 
be something in return.
    And so, we are going to see a whole lot of additional 
corruption as people are going to make side deals, just in 
case. And the money may never be spent. But once again, it will 
have an impact on the legislative process.
    And then another element of what David asked. You know, it 
really used to be in the days when I first got here that you 
could see a lot of Members of Congress who were recruited to 
come here by people in their communities who went to them and 
said, ``You have done wonderful things. You have built a great 
reputation. How about spending some time in public service?''
    Now if I wanted to go to somebody like that now, I would 
say, ``It is time to spend some time in public service. And 
here is what is going to happen. The first thing is brace 
yourself for the $5 million that will come in by your opponent 
and other related groups, designed to strip the bark off you 
and destroy that reputation you have spent your career 
building. And they will know they have succeeded when your kids 
come home from school crying and say they can't go back anymore 
because of all the embarrassment that they face from their 
friends and fellow students.
    ``And you will do the same thing, and then you will get 
elected, and nothing is going to happen around here because the 
two parties are completely gridlocked. But you will spend every 
spare minute, that you aren't racing to get a plane to go back 
home, spending money, raising money for the next time around.''
    It is a miracle, under these circumstances, that we get 
good people like you who continue to do this. And I don't know 
how much longer. Because the ones who are incentivized to do 
this now are the ones who are driven totally by naked ambition 
or by an ideology that makes them certain that they have the 
right answers and that it is all black and white, and 
especially those people who pop up and say, ``I am not like the 
rest of those bozos up there. I am not a politician.''
    So we are leeching out the people who are here to solve 
problems, and we are encouraging the worst sorts to come in. 
And that is--this is maybe as fundamental a problem in terms of 
the future of this institution as anything else, and it has 
been driven by a lot of things, including a debasement in the 
culture more generally where lying is no longer treated as a 
shameful thing and you double down on your lies to get around 
it, but also by what Citizens United itself and its progeny 
have wrought.
    Mr. Gonzalez. Thank you very much.
    And I know we have gone over time, but if you will just 
indulge us for a couple of minutes, I am going to see if my 
colleagues have very short follow-up because we have had some 
great discussion since they were able to pose their questions.
    I will recognize Mr. Price.
    Mr. Price. Thank you.
    I will ask a very pointed question, one on a narrow topic 
and the other somewhat broader. But I do appreciate especially 
what Professor Ornstein just said, getting at the broader 
corrosive effects of this system on this institution and on 
American politics generally. That isn't a strictly legal 
argument, but it sure is an important one. And that is also 
what I want to ask about.
    First, a very narrow question. I like your quote, Ms. 
Teachout, about the limits of disclosure. ``You can't X-ray a 
patient back to health.'' That is a good one. I want to 
remember that one. The limitations of mere disclosure.
    However, as we've all said, we do believe that, at a 
minimum, we need to push for disclosure and that, of course, 
there is no question that that would pass legal muster. There 
is a problem. Stand by your ad. You know who is standing by his 
or her ad: the candidate. Or, with the party, the party leader. 
That is not so clear with ``Americans For All Good Things.''
    So the device that we have come up with, I did this in my 
``stand by every ad,'' the latest iteration of ``stand by your 
ad''--the Stand by Every Ad Act and its parallel provisions in 
the DISCLOSE Act. We have said you have got to put on the 
screen those top five donors, one way or another. Flash up 
there the top five donors or have a trailer showing the top 
five donors.
    Is that the best we can do? Is that the equivalent of what 
it would mean to saddle someone with personal responsibility 
for the ad?
    The somewhat broader issue, you know, there is a difference 
here between the legal arguments and the broader political 
arguments, and Norm Ornstein just articulated one of them. But 
we talk time and time again about voices being drowned out, 
about the voices of ordinary people, of ordinary citizens, just 
coming to count for nothing.
    It is not just about corruption. I mean, I guess the most 
powerful legal argument is about corruption. Is that true? I 
guess that's my question. But in legal terms, how do we 
translate this intuition we all have that this is a disaster 
for democracy?
    The voice of these few wealthy people become so 
disproportionate, so overwhelming, drowning out everything 
else. There is surely no way that can be healthy for democracy. 
Yet, I think our legal arguments often go to the corruption 
issue and don't do much else.
    I guess I'm just asking, the political argument, of course, 
is one thing, and the legal argument is another. But, is there 
a legal hook for this intuition we all have that you simply 
cannot have a few voices drowning out the others?
    Ms. Youn. I represented the Arizona Clean Elections 
Commission in the Supreme Court case McComish v. Bennett, which 
was about the Arizona public financing system. And I remember 
sitting up there and feeling my heart sink when Chief Justice 
Roberts said, you know, ``I was looking on the Commission's Web 
site this morning, and I came up with a--I saw a reference to 
`level the playing field,' and that makes this law 
unconstitutional.''
    So we are in a situation right now where the Chief Justice 
of the United States thinks that equality is somehow 
unconstitutional. And this is, I think, the distorted vision of 
the Constitution that has been promulgated in decisions like 
Citizens United, the idea that the First Amendment and ideas of 
equality in democracy are irrevocably at odds. The reason that 
so much legal argument has focused on corruption narrowly is 
because that is what the Supreme Court has defined the only 
legitimate interest in regulating campaign ads to be.
    They have said, ``No, we don't care about hearing other 
voices. We don't care about equality. God forbid we care about 
leveling the playing field. We don't care about saving 
candidates' time so that they are not constantly dialing for 
dollars. We don't care about the integrity of our electoral 
systems. All we care about is this very narrow version of 
corruption.'' And I think that that is what we need to push 
back really hard against.
    Ms. Teachout. So I like the five names. I would like it 
even more if they had to themselves say that they stood by the 
ad. But, no, I think it is a wonderful way to have, actually, 
the names up there. I think this is creative.
    This actually also goes to Representative Van Hollen's 
question. A majority of the Supreme Court doesn't actually 
think corruption is an idea that makes any sense at all. They 
say two things.
    One is, ``Corruption is the only interest that can be used 
to outweigh this First Amendment interest.'' Not our Founder's 
First Amendment, this sort of nutty, outer space First 
Amendment. And then at a core level, they actually don't know 
what corruption is because in Kennedy's opinion, he expects and 
accepts, as does Scalia, that Members of Congress will be 
dependent and responsive to donors' interests, as opposed to 
the public interest.
    They, at a core philosophical level, do not believe in the 
public good, and they are totally at odds with the country. The 
country still believes in the public good, a possibility of 
public interest. But for a whole bunch of reasons, there is an 
ideological position that doesn't support that.
    I have been sort of interested in this question, too, about 
legal hooks, and I have been interested in possibly Congress 
coming back and redefining bribery. Because one of the things 
Kennedy says in Citizens United is, ``Don't worry, our bribery 
laws will deal with that.''
    So what if Congress came back and said, ``Your 1991 case 
where you said campaign donations aren't treated by the normal 
bribery laws, we are overturning that because that was just a 
matter of construction. We want to say that campaign 
contributions and independent expenditures should be treated by 
the normal wink and nod provisions of our federal bribery and 
extortion statutes.''
    There would be an interesting back and forth with the 
Supreme Court. But what I think that would show is that this 
Congress understands that we, as the public, do believe that 
there is a corrupt institutional problem here, and bribery 
might be the right word for it.
    Mr. Ryan. I will respond to your question with respect to 
the stand by your ads. Is that type of provision enough to 
create accountability? I am a strong supporter of the ``stand 
by your ad'' provisions, the expanded version that you have 
advocated. But it is not enough.
    Because one of the ways that voters get their information, 
one of the ways that people in our society get their 
information is through the press, through journalists analyzing 
data that is crunched through the hard work of nonprofits like 
the Center for Responsive Politics that attach and slice and 
dice this contributor data according to occupation and employer 
and interest groups.
    Those stories reach voters and are just as important as 
seeing the name of five folks on the face of an ad at the tail 
end when they may or may not be paying attention. It is really 
important that all of you continue to support, to strongly 
advocate the improvement of collection and fine grain data, of 
contributor data, data that is missing now because disclosure 
on money going to (c)(4)s, for example, is not required.
    That data is really vital to help the journalists who are 
working really hard to improve transparency and tell the 
stories, the bigger stories about who these interest groups 
are, why they are spending what they are spending. And your 
work can really help facilitate that.
    Mr. Ornstein. Let me say I am a strong supporter of your--
of the ``stand by every ad'' provision, and part of the reason 
being that the disclosure regimen that affects Super PACs is 
such a farce now anyhow. You know, you get it every 6 months. 
It is delayed. It is not there for voters to be able to take 
into account when the decisions are actually made.
    At the same time, I would come back to the Federal 
Communications Commission. They are in the process of putting 
together a regulation, which they have done very carefully and, 
I think, very conservatively so that small TV stations won't 
have a burden. But basically, all stations now are required to 
keep information on the funders of ads in a public file. That 
public file usually is in stacks of papers stuck in a back 
room.
    The law says that citizens have access to it. Try and get 
access. Go to a local television station. Nine times out of 10, 
they will tell you, ``No.'' But there is no reason why it 
should be in that setting. And for the kinds of data that Paul 
is talking about it, it would require entities like the Center 
for Responsive Politics or the Brennan Center to go to every 
single station and spend hours looking through files.
    What the FCC wants to do is to require the larger stations 
now in the biggest markets to put all of that data online, and 
it will be accessible on the FCC website. It actually will cost 
those stations less. You won't have to get the data, walk it 
across a room, put it in a file. You just punch it in, and 
almost all of them already have websites, and they have Excel 
files in which to do this.
    But they are facing huge pushback from television stations. 
Television stations will make billions of dollars in additional 
profits because of what has happened in this campaign system.
    The idea that they won't disclose for the public the 
sources of those ads is outrageous. You need to fight against 
the broadcasters and provide backing, write letters, and do 
other things to tell the FCC that they are on the right track 
here.
    Mr. Gonzalez. Wrapping it up, Mr. Van Hollen, do you have a 
follow-up?
    Mr. Van Hollen. Thank you. Thank you, Mr. Chairman.
    I just want to thank all of our witnesses. I think they 
have made excellent points.
    You know, one of the problems with the numerous court 
decisions and the direction we are headed is not only has it 
provided a whole new source of unlimited amount of money 
flowing to these campaigns, it is putting a lot of pressure on 
the very fragile campaign finance system we had [sic] because, 
as many of you have said, when you look at the situation where 
you have got these limits on contributions to candidates and 
their campaigns versus the unlimited amounts that can be given 
to Super PACs, campaigns and candidates are like fighting with 
pea shooters against bazookas these days.
    And it goes to the fundamental, one of the fundamental 
problems with the court decision. All of you mentioned it. Mr. 
Ornstein mentioned it right at the beginning of his comments, 
which is the idea that somehow if you give--if Sheldon Adelson 
gives more than $2,500 to Newt Gingrich in the primary and then 
more than $2,400 [sic] to him in the general, that that will 
somehow have a corrupting influence or the appearance of 
corruption. But if Sheldon Adelson puts $5 million to the Newt 
Gingrich PAC, that that won't, even though he is meeting with 
him and has all his campaign guys are involved. I mean, it just 
defies common sense.
    And how we could have had a Supreme Court that was so out 
of touch with reality on this issue just defies logic, and we 
are all going to have to work very hard. But I think this has 
been instructive.
    With respect to the other point the Supreme Court made that 
defies logic, with equating corporations with individuals for 
these purposes, I would just say to our chairman, and since he 
is from the State of Texas, that one of our colleagues remarked 
that they would believe that corporations are individuals when 
your state of Texas executed a corporation.
    So, you know, this is--it is just uncanny the sort of air 
of unreality that the court had on all these issues, and we are 
going to have to fight to make the changes necessary to 
preserve the integrity of our democracy.
    So thank you, Mr. Chairman.
    Mr. Gonzalez. I want to thank the witnesses. Hopefully, we 
have provided you a very unique experience in your professional 
lives to say that you may have testified in court before as an 
expert, you may have testified before a hearing as an expert. 
But today, you testified before a forum. I am not really sure 
what that means. But hopefully, that it is going to be 
substance over form, and I think we have had a lot of substance 
today.
    Thank you. I want to thank my colleagues and their staffs 
because they worked really hard. I want to thank especially my 
staff, but also the staff for the Committee on House 
Administration.
    And with that, this forum will stand adjourned.
    [Whereupon, at 3:43 p.m., the forum was adjourned.]

                                   Robert A. Brady.
                                   Zoe Lofgren.
                                   Charles A. Gonzalez.