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The Ripple Effects of the FEC's Rules on Political Blogging:
Why They Will End Up Undermining Limits on Corporation and Union Campaign Finance Activities


Tuesday, Apr. 05, 2005

In recent days, two seemingly unrelated campaign finance controversies have arisen that together highlight the nature of the coming change.

First, the Federal Election Commission has begun a 60-day rulemaking process to figure out how campaign finance activity conducted on the Internet should be regulated consistent with the McCain-Feingold campaign finance law. The commission was ordered to engage in the rulemaking by a federal district judge after she overturned FEC first inclination to give the Internet a free pass.

Although the FEC commissioners have stated an intent to regulate as little Internet-based election activity as possible, the draft rules leave open the possibility of some significant regulation of blogging activity.

Second, conservative newspapers and columnists have criticized the role of the Pew Charitable Trusts and other foundations in spending over $100 million to get Congress to pass the McCain-Feingold campaign finance law.

The criticism, based on the (likely exaggerated) comments of former Pew program officer Sean Treglia at a journalism conference, has now shifted focus to the funding by Pew and other foundations of campaign finance coverage on NPR and in the liberal magazine The American Prospect.

Who Is a Journalist - and Therefore Exempt From Spending Limits?

The FEC rulemaking requires it to consider the question of who is a journalist. That question matters very much because journalists - even if they are paid by corporations or unions - are exempt from otherwise-applicable spending limits.

Generally speaking, individuals are allowed to spend as much money as they want supporting or opposing candidates for federal office, though those spending significant sums must file certain reports with the FEC and include information on funding sources on the face of certain campaign literature. In contrast, corporations and labor unions cannot spend any of their treasury funds on certain election-related activities, and must fund these activities through separate political action committees, or PACs.

What saves the corporate-owned Washington Post and similar entities from the corporate limit is a "media exemption:" the limits do not apply to bona fide news stories and commentaries distributed through a broadcast station, newspaper, magazine, or "other periodical publication." So the Post cannot only write about federal candidates; it can endorse them for office, every day if desired, without any limit.

Online Magazines Will Be Exempt, Just as Magazines Are, But What About Bloggers?

The FEC, in its new rulemaking, appears ready to treat Slate and similar on-line only magazines as "other periodical publications" benefiting from the media exemption. But it is having a harder time with bloggers.

The draft regulations would create some safe harbors for bloggers engaged in election-related speech, but it would not necessarily grant the media exemption to a blogger who uses corporate-owned computers (even by a corporate employee who blogs on her lunch hour) to maintain a blog.

The FEC will likely be inundated with anti-regulation comments from the blogging world, and one commissioner has already indicated that "it's pretty clear that the result is not going to be bad for bloggers." To reach that result, the final regulations are likely to expand the media exemption to virtually all bloggers, or to exempt blogging from regulation altogether even when accomplished with the significant help of corporate or union resources.

If Bloggers are Broadly Exempt, Related Corporations and Unions Will Be, Too

This is the decision that will be hard to cabin to the Internet. A few months before the 2004 election, the incorporated National Rifle Association began NRANews, a daily news and commentary program broadcast on satellite radio. The NRA is claiming the press exemption. And so it goes.

In short, as everyone gets to own the equivalent of a printing press, and everyone can become a journalist, the corporate and labor limit on campaign activity stands to be swallowed up by the media exemption

And what happens a few years from now when we receive both our Internet computer access and television signals through the same cable or signal? Is a political program broadcast or beamed from your favorite (incorporated) environmental group or evangelical organization going to get the benefit of the media exemption?

Thus, it is not clear how the FEC can give a broad exemption to bloggers now without exempting all electronic media later. For some anti-regulatory commissioners, this may be precisely the point.

The Increased Importance of Disclosure of Funding Sources By Bloggers and Others

Especially if limits on independent corporate and union election-related activity disappear, disclosure of funding sources become especially important, as the Pew controversy demonstrate.

Although I highly doubt the claim that Pew's funding of campaign finance issues hoodwinked Congress into passing a law it otherwise oppose, it did highlight the need for adequate disclosure and strong conflict-of-interest rules when it comes to journalists reporting on campaign finance--or anything else relevant to the interests of the funders of coverage.

NPR regularly discloses its funding sources on air and in reports, and its newly promulgated ethics rules not only have elaborate conflict-of-interest provisions but also require that "[a] firewall be maintained between NPR journalists and funders. While staff will inevitably end up talking to experts and officials who work at foundations that fund us (and their grantees), [NPR journalists] may not discuss coverage planning with grant-making officials." The American Prospect did not disclose that it received $132,000 in Carnegie Foundation money for an issue devoted to campaign finance issues, though it now discloses its funding for other issues of the magazine.

Full and prominent disclosure of funding to support media activities is necessary to insure that the public can evaluate the fairness of coverage. Inadequate disclosure invites unflattering comparisons between The American Prospect and Armstrong Williams.

Post-Election Disclosure Is No Substitute for Contemporaneous Disclosure

Disclosure seems especially important when a journalist is being paid by a candidate or campaign to support or oppose a particular candidate for office. And shouldn't bloggers be held to the same standard?

In the last election, a few liberal bloggers did not disclose on their websites that they were being paid as consultants to Howard Dean, [Correction: this statement is incorrect, for details, click here] and other bloggers did not disclose that they were paid by the John Thune Senate campaign in South Dakota to blog against the re-election of former Senate majority leader Tom Daschle.

The FEC's draft regulations would not require disclosure on websites that a blogger is being paid by a campaign and writing about that campaign at the same time. The information would eventually come out in expense reports that the campaign must file with the FEC, but that could be after the election, and after the blog has had its impact on an election.

If bloggers want to be treated as journalists, they should not oppose at least disclosure of these financial arrangements. If you would want to know that a columnist at your favorite newspaper was on the payroll of one of the campaigns, you would want to know that about bloggers as well.

To some of us, disclosure alone may not be enough, especially when it comes to corporate and union activity. But it is far better than no disclosure at all.

Richard L. Hasen is the William H. Hannon Distinguished Professor of Law at Loyola Law School in Los Angeles and writes the Election Law blog.

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