Democrats and media commentators are noting that many Republicans are “shrugging off” the fact that Michael Cohen pleaded guilty to felony campaign finance violations which prosecutors say President Trump directed him to commit. The president, they say, is “implicated in two felonies.” How could GOP lawmakers shrug that off?
One little-discussed reason is that many Republicans never liked and continue to oppose current campaign finance laws. They don’t approve of limits on contributions by individuals, corporations, and others — they view those limits as restrictions on constitutionally-protected speech. So they don’t approve of what the laws are designed to do. But of course, the restrictions are law. Given that, many Republicans favor interpreting the law in the most limited way possible.
In that spirit, with the Cohen case, some of the best conservative thinkers on campaign finance are arguing that Cohen’s offense, to which he has pleaded guilty, wasn’t really an offense at all. And it certainly wasn’t an offense for which President Trump could be prosecuted.
Brad Smith, a former chairman of the Federal Election Commission, is one of the strongest voices in opposition to much of the current campaign finance law structure. He doesn’t believe the Trump-Cohen Stormy Daniels payoff was a campaign finance violation because he doesn’t believe it was a campaign expenditure. In a recent email exchange, Smith explained his position at some length:
The standard “for the purpose of influencing a campaign” must be read in pari materia with the prohibition in the statute on personal use of campaign funds. That section and its regulations define things that are not campaign expenditures, and personal use includes any obligations that would exist irrespective of the campaign. The obligations to Daniels or others (such as they were) were not created as a candidate. Moreover, even if Trump decided to pay the blackmail in part because he was running for president, in its implementing regulations, the FEC specifically rejected a mixed motive test, i.e. that something would count as a campaign expense if one of multiple motives was to help the campaign. It must exist solely because the candidate is running for office. But Daniels’ blackmail threat exists whether or not Trump was running for office. Clearly, Trump may be more inclined to pay it because he was running for office, but it still existed. Indeed, Daniels has said she was threatened way back in 2012. And if she only came forward after Trump were elected, he might still pay it — yet the campaign would be over. In short, it doesn’t arise solely from the campaign.
Secondly, the prosecutors want “for the purpose of influencing a campaign” to be a subjective test determined by the mindset of the actors. I believe that the test is intended as an objective test according to a reasonable observer, defining expenditures that one makes when running for office — for example, hiring campaign staff, buying ads, purchasing phone service for the campaign, renting office space, printing bumper stickers, etc. I doubt any reasonable jury would deem “payments to mistress” a “campaign expenditure.” If it were literally “anything” “for the purpose of influencing a campaign” than virtually every personal expenditure made by a person in public life might be deemed a campaign expenditure, and at least arguably subject to investigation. (Note also, that things that are “campaign expenditures MUST be paid with campaign funds.) So the phrase must be narrowed. This is in line with Supreme Court precedent, which, along with lower appellate courts, has consistently noted that the “for the purpose of influencing” language is unconstitutionally vague unless narrowed by judicial construction. Thus, where it has had cause to rule on the language, on the independent expenditure side, it narrowed the phrase to mean “express advocacy” or, later, an objective standard (mention candidate, 60 days before election) that it declared was the “functional equivalent” of express advocacy.
In short, the prosecutor has Cohen by the short hairs, so it’s not surprising that he made the plea, but this is not actually a campaign violation. We don’t have a clear appellate court ruling on this definition as applied to contributions, but the rulings on the expenditure side suggest the prosecutors are overreaching. And note that they’ve had great difficulty getting juries to convict on the theory (see John Edwards and payments to Rielle Hunter).
In other words, short answer: payments to a mistress to stay silent are not campaign expenditures. They may violate other laws or ethics rules, but they don’t violate the FECA.
Hans von Spakovsky, a former member of the Federal Election Commission, also argues that Trump’s Stormy Daniels payoff was not a campaign expenditure and should not be regulated as such. “The campaign finance law violations Cohen pleaded guilty to committing, allegedly at Donald Trump’s direction, aren’t really violations,” von Spakovsky wrote recently on Fox News:
Furthermore, the Federal Election Commission — an independent federal agency responsible for civil enforcement of campaign finance law — didn’t consider the hush-money donations to the Edwards campaign to be campaign-related expenditures when it audited the Edwards campaign.
The bottom line: Cohen was “persuaded” to plead guilty to an action that was not an actual violation of the law. … [I]f Cohen didn’t really violate campaign finance law, despite his ill-advised guilty plea — then it would be impossible for Trump to have violated campaign finance law by directing Cohen to take a perfectly legal action.
Both Smith’s and von Spakovsky’s reasoning applies to the Stormy Daniels payment. But what about the case of Karen McDougal, who was paid by the parent company of the National Enquirer in a complex deal that involved the publication paying her for her story and then making sure the story did not see the light of day? What campaign finance law applies when a corporation is involved?
It’s the same thing, von Spakovsky argued in a recent email exchange:
In another email exchange, Smith agreed. “My basic take is, no campaign finance violation, so it really doesn’t matter (for campaign finance purposes) if the Enquirer or Cohen or Trump or Trump Industries or whomever made the payment,” Smith wrote. But Smith conceded the McDougal-Enquirer case is more complex than the Stormy Daniels matter, in part because the Enquirer is a press outlet:
But much short of that, the exemption has been interpreted broadly, including allowing a publication to advertise its articles. So the Post almost certainly could put up billboards showing a picture of a Post editorial headline saying in big bold letters “Trump threatens a free press and must be defeated” and maybe saying below that on the billboard “Is Trump truly a Scoundrel? Read the Post to find out.”
To go in another direction, can the Post editors say, “the most important thing on our agenda is to assure the impeachment of Trump. I want a dozen investigative reporters on him, full time, more if necessary. Bezos will pay so spend whatever it takes!” I think so. In other words, the press works to elect or defeat candidates all the time.
And here’s the real thing. The Enquirer buys a story and doesn’t publish it. Ethical journalism? You tell me. I’m told this is not uncommon in the UK. But either way, can the press function if all its editorial decisions are subjected to second guessing by the government? Suppose, in my example above, the investigative reporters come back, $130,000 in time and expenses later, and say, “you know, there’s really nothing to this collusion business. Nothing at all. But you wouldn’t believe what we found out about Clinton, Fusion GPS, and the Rooskies!” And the editor says, “well, we’re not going to run that story.” Is the Post operating within the press exemption?
The Enquirer story, if it’s true they were promised reimbursement, is about as good a case as you could have for a periodical going outside the press exemption. (Plus, the press exemption doesn’t apply to media under a candidate’s control, which I could suppose one might argue, though of course it was intended to prevent guys like Steve Forbes from using their publications as campaign conduits). But even then, I’m not sure that’s really a road the press wants to go down, or a statutory interpretation they want to take hold. At the FEC, we got a lot of complaints against the press that were routinely dismissed without investigation. But if we’re going to start looking at the motives of editors, it could get dicey.
But again, my basic take is no campaign finance violation, so it really doesn’t matter (for campaign finance purposes) if the Enquirer or Cohen or Trump or Trump Industries or whomever made the payment.
In the past, Smith’s and von Spakovsky’s views on campaign finance have been quite prevalent among Republicans on Capitol Hill and among many conservative opinion writers as well. Now they are receiving new attention in a new, Trumpian context. The next time a Republican politician “shrugs off” the Cohen allegations against Trump, it might be worthwhile to remember many conservatives’ long-held position on campaign finance.
