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STATEMENT OF COMMISSIONER BRADLEY A. SMITH

On

COORDINATED SPENDING REGULATIONS

FEC OPEN MEETING - NOVEMBER 16, 2000

Today the Commission will consider new regulations regarding Expenditures for GeneralPublic Political Communications Coordinated with Candidates. I believe that theseregulations are a positive step forward for the Commission, and I would like to thankRosemary Smith and the OGC staff, and especially Commissioners Sandstrom and Mason, fortheir hard work on this project.

The question of coordination has long been a difficult one for the Commission. In 1996,in *Colorado Republican Federal Campaign Committee v. Federal Election Commission*("*ColoradoI*"), the Supreme Court rejected the Commission’s position that politicalparties are presumptively incapable of making expenditures independently of theircandidates. On remand in this case ("*Colorado II*"), the U.S. Court ofAppeals for the Tenth Circuit held that even coordinated expenditures by parties could notbe limited, on the theory that political parties cannot corrupt their own candidates foroffice. That case is once again on appeal to the Supreme Court.

More to the point, in 1997, in *Clifton v. Federal Election Commission*, the U.S.Court of Appeals for the First Circuit invalidated FEC regulations pertaining tocoordination in the context of preparing voter guides. Similarly, in *Federal ElectionCommission v. Public Citizen, Inc*., a federal district court in the 11thCircuit rejected the Commission’s theory of coordination based on contacts betweenagents of Public Citizen and a candidate’s campaign, including discussion aboutstrategy and issues. And in *Federal Election Commission v. Christian Coalition*, theU.S. District Court for the District of Columbia rejected the Commission’s sweepingtheory of coordination, which the Court termed the "insider trading" standardand described as "any consultation between a potential spender and a federalcandidate’s campaign organization about the candidate’s plans, projects, orneeds...." Rather, the *Christian Coalition*Court held that coordinationoccurs only where:

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"the candidate or her agents can exercise control over, or where        there has been substantial discussion or negotiation between the campaign and the spender        over, a communication’s: (1) contents; (2) timing; (3) location, mode, or intended        audience (e.g. choice between newspaper or radio advertisement); (4) ‘volume’        (e.g. number of copies of printed materials or frequency of media spots). Substantial        discussion or negotiation is such that the candidate and spender emerge as partners or        joint venturers in the expressive expenditure...."

The proposals before us today largely follow Judge Green’s ruling in *ChristianCoalition.* This is not because we are slavishly following a "lone districtcourt," as some self-described "reform" groups have suggested, but becausewe believe on the merits that the Court’s definition of coordination was largelycorrect. These regulations set forth a definition of "coordinated general publicpolitical communications" that accounts for the realities of the political world,including the norms of political employment, in which individuals often bounce betweencandidate and party staffs, political consulting firms, and like-minded citizen groups,and in which citizen groups have both a need and a right to communicate with their electedofficials about issues of mutual concern.

I understand that the usual critics of the FEC and its staff – among them theBrennan Center, Common Cause, and Democracy 21 - will complain that these regulations willmake it more difficult to prove coordination. But the mere fact that a regulation setsforth a standard that provides broad protection to what we euphemistically call "theregulated community" (i.e., the American people), does not mean that the standard iswrong or unrealistic. It simply affirms that there are other important values at stake.Here those values are obvious – the right of Americans to engage in politicaldiscussion and activity and to petition their representatives for a redress of grievances.

We should be aware, of course, that the criticism of these regulations comes not onlyfrom those who feel that the proposed definition of "coordinated general publicpolitical communications" provides too much protection for political speech, but alsofrom those who claim it provides too little. Some have argued that we ought to limit thedefinition of coordinated communications to those distributed primarily in the geographicarea in which the candidate is seeking office. Others argue that it should specificallyexempt any communication made more than 30 (or 60, or 90) days before an election. I mighthappily support such additions to this regulation, but there are legitimate argumentsagainst these proposals and the Commission must act where there are votes. The bottom lineis that these regulations are more protective of the rights of Americans to engage inpolitical activity than are our existing regulations at 11 C.F.R. 109.1, and I am happy tosupport them on that basis.

One other safeguard that was urged on the Commission deserves particular attention.Several comments on the proposed rules urged the Commission to limit its reach only tocommunications containing "express advocacy" of the election or defeat of acandidate, as defined by the Supreme Court in *Buckley v. Valeo* and *FederalElection Commission v. Massachusetts Citizens for Life*("*MCFL*"), andin numerous lower court decisions. Whether or not the case law requires such a restrictionwhen dealing with coordinated, as opposed to uncoordinated expenditures is, I think, anopen question. Certainly there is language in both *Buckley*and *MCFL* thatwould support such a conclusion, though this language is not decisive. My own view is thatthis would be the better interpretation of both the cases and the Constitution. 

Nevertheless, the district court in *Christian Coalition* rejected this view. I donot find the *Chrisitan Coalition*court persuasive on this point, however. Thejudge’s concern over "coordinated attack advertisements, through which acandidate could spread a negative message about her opponent, at corporate or unionexpense, without being held accountable for negative campaigning," seems to memisplaced. If it were actually the candidate spreading the message, that would be a directcontribution to the campaign. Assuming that the judge meant that the spender would spreada negative message, we must note that that possibility was recognized in *Buckley v.Valeo*, wherein the Supreme Court recognized that non-candidate issue ads would bedesigned "that skirted the restriction on express advocacy of election or defeat butnevertheless benefited the candidate’s campaign," but found such activity to beconstitutionally protected nevertheless. I also question whether or not JudgeGreene’s position is factually correct – indeed it is the ardent claim of manyin the self-described "reform" community, that voters cannot separate candidateads from non-candidate ads. If true, it is hard to imagine they would not hold thecandidate responsible for such negative ads.

Regardless, given this Commission’s long history of losing cases on constitutionalgrounds when we have attempted to enforce our regulations against speech not containingexpress advocacy, and given the important First Amendment concerns involved, my own viewis that it would have been wise to err in favor of an express advocacy requirement. We arenot required to forever interpret the statute so as to push our regulatory authority tothe fullest extent of what we think the Constitution might allow, then look for a testcase to prove it. Certainly we have lost enough test cases. In this light it is especiallyimportant to note that while these rules create a safe harbor for inquiries"regarding a candidate’s or party’s position on legislative or publicpolicy issues;" require that coordination may be found only where the party orcandidate exercises control over the specific commands at issue; and limit coordination tocases involving "substantial discussion or negotiation;" they do not eliminatethe chilling effect of the regulations on political speech.

Indeed, I fear that these regulations have the potential to worsen the chilling effectthat threats of enforcement can have on speech. For example, our enforcement actionagainst the Christian Coalition lasted over six years. It included 81 depositions,including those of past and present employees and volunteers. Over 100,000 pages ofdocuments were produced, at great expense to the Coalition. I can only imagine theCoalition’s legal fees, and the effect all this has on political participationgenerally. As one deponent stated, the main thing he had learned from the case was,"Never volunteer for anything." Yet a tougher standard for establishingcoordination, such as is proposed in these regulations, without an express advocacy safeharbor, may mean that future investigations will need to be even more intrusive. Anultimate finding against an investigated group is not necessary to scare citizens intoabandoning constitutionally protected speech. The chilling effect that the merepossibility of such investigations can have on speech is enormous. I hope that somedaysoon the Supreme Court will consistently apply the same rigorous scrutiny to lawsregulating political speech as it does to laws regulating topless dancing, internetpornography, and commercial speech. However, even under the Court’s looser standardof review, I believe it is quite likely that, having done a tremendous amount of work tocome up with these regulations, we will find ourselves back on the wrong side of theConstitution in future litigation. Adopting an express advocacy standard would save usthat possibility. 

Despite these concerns, I can support these regulations because they specifically leaveopen the question of whether or not they apply to coordinated communications that do notinclude express advocacy. Our failure to answer this question will no doubt leave a greatdeal of uncertainty in the "regulated community," but when the Commission isdivided, we need to act where we can. These regulations provide new clarity regardingexpress advocacy expenditures, and in that context are more protective of First Amendmentrights and values than the regulations and practices they will supercede. Furthermore,they should allow more cases to be dismissed at the "Reason to Believe" stage,thus benefiting free and open political participation. I hope that we will someday have amajority of the Commission in favor of adding an express advocacy requirement to theregulations, but for now, I take comfort in knowing that the question is left open foranother day – and that, too, I take to be an improvement over our current practice. 

Despite their imperfections, I believe that on the whole these regulations are asignificant positive step in respecting constitutionally protected speech and in restoringpredictability to the Commission’s activities in the realm of coordinatedexpenditures, and I will support them today.

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