Watchdog FEC sidelined as elections roll

A record-spending primary season is in full swing, but America's elections watchdog is fresh out of bark and bite.

Four of the six seats on the Federal Election Commission are vacant, with nominations caught up in partisan gridlock in the US Senate. The FEC can still disclose data on elections, but without a quorum, it can't issue regulations and binding opinions or file lawsuits.

"Everyone is running around Iowa and New Hampshire, and no one noticed that the FEC closed for business last week," says Anthony Corrado, a campaign-finance expert at Colby College in Waterville, Maine.

In an election where spending is already on track to exceed $5 billion, even small ambiguities in the law can shift vast sums of money – and prospects for candidates.

Moreover, without FEC action, a new federal ethics law requiring the disclosure of so-called "bundled" contributions, may not take effect in time to influence the 2008 election cycle.

While federal law limits individuals to $2,300 in contributions to a specific campaign, it's not illegal for individuals to persuade friends and associates to also contribute and then take credit for the total. This bundle of contributions can enhance the political access of an individual donor.

But the Honest Leadership and Open Government Act, which President Bush signed into law on Sept. 14, imposes new disclosure requirements on bundlers who are also registered lobbyists. Candidates and party committees now must disclose a bundler's name, address, employer, and the total contribution he or she is taking credit for. This reporting requirement takes effect 90 days after the FEC completes final regulations.

While the FEC has completed work on other rules in the new lobby and ethics law, such as restrictions on travel on private jets, it hasn't competed regulations on the requirements for bundlers.

To many public-interest groups, bundling disclosure is the cutting edge of the new lobby and ethics law – and the FEC's current limbo means that bundling disclosure requirements will not be complete in time for the 2008 election cycle.

"It's absurd and irresponsible for our democracy to have a campaign-finance enforcement agency shut down right as we're going into the heart of the 2008 presidential nomination process," says Fred Wertheimer, president of Democracy 21, a public-interest group. "The growing problems associated with influence-seeking bundlers raising money for the 2008 presidential candidates provide powerful evidence that the privately funded, unlimited spending 2008 presidential primary race has returned American politics to the days of the Wild West."

Until recently, FEC enforcement efforts focused mainly on abuses during the 2004 electoral cycle, especially the activities of groups that poured millions of dollars into federal campaigns and accepted contributions above the limits in federal law.

Swift Boat Veterans and POWs for Truth raised more than $25 million in the 2004 election cycle to criticize the military record of Sen. John Kerry, the Democratic presidential nominee. In 2006, they settled with the FEC for civil penalties of $299,500. The League of Conservation Voters, which was critical of President Bush, raised $6.7 million in the 2004 election cycle, and paid penalties of $180,000. MoveOn.org's Voter Fund, which spent $14.6 million on television advertisements in battleground states shortly before the 2004 presidential election, agreed to pay a civil penalty of $150,000, according to the FEC.

FEC officials, citing a record $5.5 million in fines last year, say such penalties are setting a new tone for candidates and groups raising funds for Campaign 2008.

But some public-interest groups say even a fully functioning FEC was less than effective in enforcing the laws on the books.

"All of us would rather have a functioning FEC, but even their enforcement actions are so delayed and the amounts so small, given the magnitude of the money involved, it's hard to get too exercised," says Meredith McGehee, policy director of the Campaign Legal Center.

To political campaigners, "the FEC is seen as a cost of doing business," she adds.

Meanwhile, the Senate – now meeting in pro forma sessions to avoid presidential recess appointments – remains deadlocked over four pending FEC nominations, two proposed by Democrats and two by Republicans. All four have been serving as FEC commissioners under previous recess appointments. Senate Democrats have criticized one of the GOP nominees, Hans von Spakovsky, for his previous work in the Justice Department.

Other nominees include Robert Lenhard, David Mason, and Steven Walther.

Senate majority leader Harry Reid proposed an up-or-down vote on each nominee, but Republican minority leader Mitch McConnell is holding out for a vote on all four at once.

"If we're going to have a vote, it should be balanced and bipartisan," says Don Stewart, a spokesman for Senator McConnell. "Generally, the reason we move [FEC nominations] in groups is so that the party in the majority doesn't have a veto over the others."

Democrats say that the only way out of the impasse is for Mr. Bush to nominate someone else. "The next move is up to the White House," says Jim Manley, a spokesman for Senator Reid.

Ironically, the four nominees have been serving on a commission that has been unusually free of partisan rancor.

"The conventional wisdom about this agency – that it is divided on partisan lines, three Democrats and three Republicans, and that we deadlock all the time – is completely untrue," says commissioner Ellen Weintraub, who was nominated by Democrats.

"In fact, we almost never deadlock. There are thousands of votes throughout the year, and we deadlock on about 1 percent of them. We have taken some tough votes and agreed on some pretty stiff penalties for important political players out there," she adds.