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November 11, 2010

‘Secret Money’ a Prime Factor in Elections, Lawyers’ Panel Says

adminreglogoThe Nov. 2 election was historic both in terms of the change it brought about in the U.S. Congress and state legislatures, and also in the amount of money — much of it secret — that was spent in the races.

A Supreme Court ruling, in Citizens United vs. Federal Election Commission, led to the creation this summer of “super PACs” that can raise unlimited money to expressly advocate for or against candidates. Much of the disclosure that is required of such entities won’t happen until after the elections.

A panel of election law experts addressed the _ 2010 Administrative Law conference on “The 2010 Elections and the Future of Campaign Finance Reform.”

One question arising immediately after the Citizens United ruling, according to former general counsel to the National Republican Senatorial Committee William McGinley, was not whether the case would have an impact on the election — we knew that it would drastically do so — but who would take advantage of the ruling.

Huge amounts of corporate money were in play in the recent election, in addition to the secret money, whether that was from corporations or other sources, said former in-house general counsel of the Democratic National Committee Joseph Sandler. With the U.S. Chamber of Commerce doubling its spending this cycle to an avowed $75 million, one would expect that corporate interests accounted for a large portion of monies going into the races, said Tara Malloy, associate legal counsel for the Campaign Legal Center, a nonpartisan, nonprofit organization that works in the areas of campaign finance and elections, political communication and government ethics.  But as McGinley noted about the spending, “you’re not going to know.”

The current “dire” stage, as Malloy called it, has led to proposed change from highly-unlikely-to-happen constitutional amendments being offered to more modest U.S. legislative efforts such as the DISCLOSE Act. The latter, as explained by Malloy, seeks to ensure that corporations and unions can’t hire money by funneling it through other entities.

At the state level, changes have been enacted in no fewer than nine states since the January ruling, according to the National Center for State Legislatures. In the last four months, challenges to those statutes have been raised in all of them. Initially, however, statutes have in large part withstood those challenges.

While the money spent in the 2010 cycle was historic, McGinley noted that citizens hear that every election cycle. He argued that because of Citizens United, we saw money spent on different types of ads than we would have, namely express advocacy versus issue ads.

Panelists also addressed the likelihood of whether some bipartisan legislation on disclosure might be enacted in the ‘lame duck’ session of Congress.  The panelists agreed that is not expected, and Malloy emphasized that the real crux is “disclosure of donors.”  The battle ahead will not only take place in Congress, but will also be fought in the courts, she continued.