Internet Fundraising and Campaigning

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Internet Fundraising and Campaigning
Professor Rick HasenLoyola Law School, Los
Angeles http//electionlawblog.org COGEL
Conference December2008
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Outline

• What issues does the proliferation of
  Internet-based fundraising and campaigning raise
  for campaign finance regulators?
• The coming (and arrived) explosion of
  Internet-based small donor fundraising data and
  disclosure issues
• The convergence of Internet and television
  dangers of regulatory drag and obsolescence

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Issues Raised for Regulators by Internet-Based
Campaigning and Regulating

• Treatment of candidate and other committee web
  advertising
• Treatment of candidate and other committee
  communications (solicitations, value of email
  lists, posting of video material)
• Use of corporate/union owned computers, servers,
  etc.
• My focus small donor issues and
  internet-television convergence

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Small Donation Issues The Obama phenomenon and
the shape of things to come
Perhaps the most important way that the Internet
has affected fundraising and campaigning is
through a dramatic lowering of costs associated
with small donation issue. Cheap speech and
proliferation of credit/debit card internet based
commerce has caused an explosion of small
donation fundraising on the internet
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Presidential small donation fundraising during
primary seasons, 2000, 2004, 2008 (small donor
data from Campaign Finance Institute reports)
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Percentage of money raised in micro-donations,
2000, 2004, 2008

• 2000 primary season
• Al Gore 20
• George W. Bush 16
• 2004 primary season
• John Kerry 37
• George W. Bush 31
• 2008 Primary season
• Barack Obama 53
• John McCain 31
• (Hillary Clinton 36)

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The sheer volume of donations raise data
collection and processing issues for regulators
With presidential candidates attracting up to
millions of donors, campaign regulators face
problems dealing with mountains of data. As
public gets more comfortable with internet-based
giving, more of it will take place on the
sub-presidential level.
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Special issues involving micro-donors
Micro-donors give federal campaign, and currently are itemized
information not reported to FEC.
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Amount raised from micro-donors, 2008 primary
season
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More on Micro-Donor Fundraising in 2008 Primary
Season
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Concern over Lack of Reporting Requirements for
Micro-Donors
Some in public raised concerns about illegal
contributions (illegal source or excess
contributions) Possible congressional move to
expand disclosure Disclosure of small donors
raises both administrative and constitutional
issues. My alternative disclosure to FEC, not
public, with mandatory audits of this aspect of
all campaigns
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The coming convergence of television and the
Internet

• A number of special laws apply only to television
  and radio advertisements (e.g., federal limits on
  corporate and union spending on electioneering
  communications)
• As people begin to get more of their television
  content through their computers, cell phones, and
  iPods, what is to become of existing regulations?

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Possible paths

• Obsolescence (law doesnt change, but practices
  become unregulated)
• Law is updated to comport with changed usages
• Resistance (FEC regulatory example)
• Drafting difficulties
• Unintended consequences (Law does not function
  as it should because it is applied in a new area)

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Choosing an Approach

• Regulators should
• Figure out goal existing law was meant to meet
• Confirm relevant constituency still wants this
  goal met.
• Consider how rise of Internet-based campaign
  activity might interfere with achieving goal.
• Determine whether it is possible to meet goal
  through (1) existing law (2) revised
  law/regulations or (3) repeal of existing law.