Michigan Campaign Finance Network Applauds Court Decision, Warns of Possible Loophole in Michigan

A statement from the Michigan Campaign Finance Network:

The U.S. Supreme Court decision in the case of Caperton v. Massey Coal Company establishes that extraordinary campaign spending to support the election of a judge can create an unconstitutional probability of bias that requires the judge to disqualify himself from a case involving his campaign’s financial supporter.

The U.S. Supreme Court noted that the Caperton case was extreme, but “because the States may have codes with more rigorous recusal standards than due process requires, most recusal disputes will be resolved without resort to the Constitution, making the constitutional standard’s application rare.”

This decision underscores the wisdom of the Michigan Supreme Court’s ongoing effort to establish workable recusal standards for itself that will consider extreme campaign spending of the sort that has become a regular feature of contemporary Michigan Supreme Court election campaigns.

However, rigorous recusal standards for the Michigan Supreme Court will be undermined by the failure of Michigan’s Campaign Finance Act to require disclosure of contributors to organizations such as the Michigan Chamber of Commerce and the state’s political parties that sponsor candidate-focused “issue” advertisements that seek to define judicial candidates’ records, qualifications and suitability for office without explicitly exhorting a vote for or against a candidate. Without knowing who contributes to the committees that sponsor candidate-focused issue ads, it will not be clear when a motion for recusal rightfully should be filed.

The decision in the Caperton case provides an important buttress for citizens’ due process rights to an impartial judicial hearing. However, Michigan legislators must address the shortcomings in our campaign finance disclosure regulations if this protection is to have its full effect.

Michigan Campaign Finance Records Broken in 2008

Even as Michigan’s economy continued its downward spiral, many campaign finance records were broken in 2008 according to the Michigan Campaign Finance Network’s 2008 Citizen’s Guide to Michigan Campaign Finance.

The organization reports that campaigns for the U.S. House of Representatives in the 7th and 9th Congressional Districts both exceeded $9 million. Statewide races also exceed records, with the campaign for an open Michigan Supreme Court seat costing more $7.5 million. In races for the State House, spending was up 12.6% from 2006. A record was set for individual spending with Lisa Brown’s campaign for the 39th District exceeding $930,000. Spending by political action committees (PACs) was up by more than 500%.

According to Michigan Campaign Finance Network chair Rich Robinson, this highlights the problems with campaign finance in Michigan. In a news release accompanying the release of the guide, Robinson says there is a correlation between spending and electoral success and that the spending generally dictates the policy agenda in the state.

Along with an accounting of the spending, the guide also looks at many of the problems with Michigan’s campaign financing regulations. The report points out that much of the spending on the Supreme Court race was “off the books” as it focused on “issues” rather than specific candidates, thereby avoiding regulation. Similarly, candidates do not file campaign finance reports frequently enough according to the Michigan Campaign Finance Network, which recommends a regulatory change that would require reports to be filed quarterly. There are also no limits on contributions to political action committees.

Overall, the guide is essential reading for anyone interested in both campaign finance reform and the role of campaign spending in state politics.

Poll Finds Michigan Residents Believe Judges are Biased by Financial Contributions

A new poll of voters in the last election conducted by the Michigan Campaign Finance Network has found widespread concern that judges may be biased in cases involving financial supporters.

According to the poll, 85% of those surveyed said a judge should disqualify themselves if a case involves a campaign supporter. 63% said they believe that campaign contributions effect the decisions that judges make, with 31% saying that contributions make “a lot” of difference. 86% of those surveyed that another judge should determine when a judge should be disqualified from hearing a case involving a campaign supporter.

Respondents also said that disclosure of campaign funds is essential.

Top Michigan PACs Raised $41.4 Million in 2008 Election Cycle

The Michigan Campaign Finance Network reported today that while Michigan’s economy is in serious trouble, “the money-in-politics sector” continues to be robust.

In the 2008 election cycle, the top 150 political action committees (PACs) in Michigan raised over $41.4 million to influence legislation and elections. While the number is down 20.3% compared to the $51.9 million raised in the 2006 election cycle (which had a more state races), the amount raised is up 23.9% over the 2004 election cycle.

Michigan’s biggest PAC was once again the liberal Coalition for Progress. The PAC raised $4.2 million (91% of it came from Kalamazoo businessman John Stryker) and made contributions supporting Democrats in twelve House races.

The state’s political leaders–Governor Jennifer Granholm, Speaker Andy Dillon, Senator Mike Bishop, and Attorney Mike Cox–all raised considerable sums of money for their leadership PACs.

The Great Lakes Education Project–a PAC closely associated with West Michigan’s DeVos family–raised $451,000. $350,000 of that money came from the DeVos family.

Obama’s “Small Donors” — About the Same Percentage as Bush in 2004

The nonpartisan Campaign Finance Institute has released a new analysis showing that Democrat president elect Barack Obama’s claims of running a campaign primarily supported by so-called “small donors” is greatly exaggerated.

In the analysis, the Campaign Finance Institute finds that while a high percentage (49%) of Obama’s contributions were $200 or less, only 26% of his donors were so-called “small donors,” a number that is barely higher than President George W. Bush’s percentage of small donors in 2004.

To be sure, Obama reached more small donors than previous candidates and a larger percentage of his money came from small donors. However, big donors–those contributing over $1,000–were significant players in his fundraising efforts. 47% of his donors gave over $1,000, accounting for 33% of his fundraising totals. According to the Campaign Finance Institute:

“Much of this money was raised the “old fashioned” way. Since only about 13,000 of those who started out small for Obama ended up crossing the $1,000 threshold, that means the bulk of Obama’s $213 million in large-donor contributions during the primaries came from about 85,000 people who started out giving big and stayed there. Much of this large-donor money – perhaps close to a majority – came to the campaign through bundling methods initially perfected by Bush.”

Hopefully as the election hype winds down, a debate will occur about Obama’s fundraising and his decision to forgo public financing. Because while he did raise considerable money from small donors, it was hardly the popularly funded, “every person” campaign that it is often made out to be.

Statistics from the analysis:

Looking Back on Campaign Finance in 2008

Campaign finance has been something that MediaMouse.org talked a lot about in 2008. Often times our numbers came from the Michigan Campaign Finance Network, an excellent source looking at the relationship between money and elections in Michigan.

Yesterday, the Michigan Campaign Finance Network released an analysis of the 2008 elections and the lessons learned. The group examines Obama and his fundraising, the Michigan Supreme Court race, the relationship between spending and victory, and more. It’s definitely worth reading the entire article, but here are some interesting points from its conclusion:

“Extremes of campaign finance were on display in 2008.

The stem cell ballot proposal was the third-most expensive ballot question since 2000, after the racino proposal of 2004 ($27.6 million) and the school voucher proposal of 2000 ($19.6 million). Proposition 2 of 2008 ran over $15 million, with proponents spending over $9 million for their successful campaign and opponents spending over $6 million. Developer Al Taubman gave the proponent committee more than $5 million and the Michigan Catholic Conference gave the opponent committee more than $5 million.

Barack Obama was supported by millions of contributors in the biggest and most broadly based campaign in American history.

Michigan’s state Supreme Court campaign was mainly under the table and we don’t know who put up most of the money.

Off-the-books campaigning is particularly toxic for Supreme Court campaigns because we can’t see whether a prospective party to an appeal is spending big to make sure its case is heard by the judge of its choosing. The U.S. Supreme Court has assured that all parties, including corporations and unions, can spend their money for electioneering communications, but the spending should not be allowed in a way that conceals potential conflicts of interest, and those conflicts of interest should not be ignored. All electioneering spending should be reported and more stringent standards for recusal should be enacted.

In a concession to reality, Michigan should rededicate its public campaign fund to Supreme Court campaigns so candidate committees have a viable alternative to soliciting funds from interest groups and individuals who may be part of an upcoming appeal. Michigan’s gubernatorial public financing system is broken in precisely the same way as the presidential system, but the fund could support viable Supreme Court campaigns. Michigan Supreme Court campaigns are among the most infamous in the country, but they can be cleaned up. Policymakers just need to make a stand for integrity over expediency.”

Michigan’s Public Financing System Facing Serious Problems

A new study by the Center for Governmental Studies finds that Michigan’s 32-year old public financing system is in a state of disrepair and needs to either be overhauled or completely scrapped. The Center finds that the system is not making good on its goal of increasing the number of candidates and increasing public confidence in elections.

According to the report, Michigan’s system is facing two major problems–expenditure limits are too low and contribution limits are too high. Under the current system, individuals can accept individual contributions up to $3,400 while still receiving public financing. Over the past ten years, most candidates have stopped accepting public financing and due so only when they are facing wealthy opponents because it increases the expenditure limits.

The report makes four recommendations to remedy the situation:

* Increase public funding for the program. With increased public funding, the program can again meet its original goals: to reduce candidates’ dependence on large private contributors, provide them with adequate yet neutral sources of campaign funding, and encourage talented newcomers to enter politics.

* Lower contribution limits and improve disclosures. Whether or not Michigan increases its public funding, it should consider lowering the program’s contribution limits. This will reduce the influence of large contributors on the political process.

* Shift funding for gubernatorial elections to Supreme Court judicial elections. If Michigan cannot increase the public financing available to its gubernatorial candidates, the most desirable option, the state should shift this money to a system of judicial campaign financing. This would allow candidates for the state supreme court to run without excessive dependence on private contributions, and it would strengthen the impartiality of the state’s highest court.

* Abandon gubernatorial program. If Michigan cannot expand public financing for its gubernatorial candidates or transfer the funds in that program to judicial candidates for the state supreme court, it should consider abandoning its gubernatorial public financing program as a cost-saving measure.

Barack Obama Opts out of Public Financing System

Last Thursday, Democratic Party presidential candidate Barack Obama announced that his campaign was opting out of the federal public financing system for the general election system. While he will not receive the $84 million in federal funding that he would have otherwise received, he will instead be able to raise an unlimited amount of money. Obama’s campaign says that they were forced to make this decision because the system is broken and that the Republican Party has been able to manipulate the system to its advantage. Obama–who pledged to accept public funding last year–is the first major party candidate to opt out of the system.

On today’s episode of Democracy Now!, representatives from the Center for Responsive Politics and Americans for Campaign Reform discussed the decision. Nieither offered much criticism of Obama’s decision. Instead, they both talked about inherent flaws in the public financing system and the fact that $84 million is “not enough” money to run a presidential campaign.

Factcheck.org criticized Obama’s justification for rejecting public financing system, arguing that Obama justified his decision based on unwarranted claims about “527 groups (http://www.sourcewatch.org/index.php?title=527_committee)” and lobbyists. Moreover, Paul Street–a fierce critic of Obama from the left–points out that Obama has raised significantly more money than Republican John McCain–$265 million to McCain’s $95 million–the majority of which has come from the top 1% of Americans. Despite Obama’s claim that he is receiving money primarily from small donors, he has received $89 million in contributions of $1,000 or more. Similarly, the Center for Responsive Politics reports that Obama’s top contributors include corporations such as Goldman Sachs, Citigroup, JP Morgan Chase, and Google.

A major issue that has been ignored in much of the reporting on Obama’s decision is the money that television and radio conglomerates make from election related advertisements. Around the country, media companies will receive millions of dollars in exchange for airing candidate ads. Is there another a way that this could be handled–perhaps a system for equal media access to the airwaves for all candidates via public interest requirements for broadcasters? Similarly, why is it that $84 million may not be enough to run a campaign? What does that say about who can afford to run for office and how the election system functions?

Party Conventions being Funded by Major Corporations

A new report from the Campaign Finance Institute has found that while Republican Senator John McCain and Democratic Senator Barack Obama are both running campaigns promising “campaign finance reform,” their party conventions are being funded primarily by unlimited and unregulated contributions from corporations.

The Democratic National Convention and the Republican National Convention–both taking place in late summer–are relying on corporate donors to come up with the more than $55 million in private funds that needs to pay for the conventions in each city. According to the report, the more than 100 organizational donors to the two cities “host committees” (committees responsible for raising funds to pay for the conventions), are heavily involved in buying political influence. Since 2005, they have made nearly $100 million in contributions to federal candidates and parties via political action committees (PACs) as well as individual contributions. During the same period, they spent $700 million to lobby Congress and the Executive Branch.

Unfortunately, these contributions are subject to only minimal scrutiny and disclosure. While only a small minority of contributions come from entities in the host cities, the Federal Election Commission (FEC) says that these contributions are “motivated by a desire to promote the convention city and not by political considerations.” Election law classifies host committees as nonpartisan “charities” or “business leagues.” Moreover, host committees are not required to report their contributions or expenditures until 60 days after the conventions are over. In the past, host committees have occasionally volunteered this information, but neither the Denver or St. Paul host committees have done so this year.

However, while host committees are classified as “nonpartisan,” their money raising efforts often include written and oral promises of special access to federal elected officials and national party leaders. In both Denver and St. Paul, formal sponsorship and donor packages have been sold promoting “private” events with elected officials. Similarly, corporations seeking to shape public policy, are giving to both conventions, with 25 corporations donating to both host committees ensuring that regardless of what party wins the election that their voice will be heard.

In 2004, convention host committees raised over $100 million for the conventions by relying on similar donations.

Democratic Party Superdelegates Receive Money from Clinton and Obama

The Center for Responsive Politics has investigated how much money the so-called “superdelegates“–Democratic National Convention delegates who are seated automatically without regard to the choice of primary and caucus voters–have received from both the Clinton and Obama campaigns. This certainly raises questions about whether or not the two Democratic Party candidates are trying to buy these delegates support before the Convention this summer. Here is a portion of the Center for Responsive Politics’ “Seeking Superdelegates” article:

“At this summer’s Democratic National Convention, nearly 800 members of Congress, state governors and Democratic Party leaders could be the tiebreakers in the intense contest between Hillary Clinton and Barack Obama. If neither candidate can earn the support of at least 2,025 delegates in the primary voting process, the decision of who will represent the Democrats in November’s presidential election will fall not to the will of the people but to these “superdelegates”–the candidates’ friends, colleagues and even financial beneficiaries. Both contenders will be calling in favors.

And while it would be unseemly for the candidates to hand out thousands of dollars to primary voters, or to the delegates pledged to represent the will of those voters, elected officials who are superdelegates have received at least $904,200 from Obama and Clinton in the form of campaign contributions over the last three years, according to the nonpartisan Center for Responsive Politics.

Obama, who narrowly leads in the count of pledged, “non-super” delegates, has doled out more than $698,200 to superdelegates from his political action committee, Hope Fund, or campaign committee since 2005. Of the 82 elected officials who had announced as of Feb. 12 that their superdelegate votes would go to the Illinois senator, 35, or 43 percent of this group, have received campaign contributions from him in the 2006 or 2008 election cycles, totaling $232,200. In addition, Obama has been endorsed by 52 superdelegates who haven’t held elected office recently and, therefore, didn’t receive campaign contributions from him.

Clinton does not appear to have been as openhanded. Her PAC, HILLPAC, and campaign committee appear to have distributed $205,500 to superdelegates. Only 12 percent of her elected superdelegates, or 13 of 109 who have said they will back her, have received campaign contributions, totaling about $95,000 since 2005. An additional 128 unelected superdelegates support Clinton, according to a blog tracking superdelegates and their endorsements, 2008 Democratic Convention Watch.

Because superdelegates will make up around 20 percent of 4,000 delegates to the Democratic convention in August–Republicans don’t have superdelegates–Clinton and Obama are aggressively wooing the more than 400 superdelegates who haven’t yet made up their minds. Since 2005 Obama has given 52 of the undecided superdelegates a total of at least $363,900, while Clinton has given a total of $88,000 to 15 of them. Anticipating that their intense competition for votes in state primaries and caucuses will result in a near-tie going into the nominating convention, the two candidates are making personal calls to superdelegates now, or are recruiting other big names to do so on their behalf. With no specific rules about what can and can’t be done to court these delegates, just about anything goes.”