Labor unions would be winners of Seattle’s proposed campaign-finance rules

The Seattle City Council is close to passing several ordinances, championed by Councilmember M. Lorena González, overhauling the city’s campaign-finance rules — but not for the better.

Together, the proposals would impose a potentially unconstitutional crackdown on political participation and speech by entities the City Council doesn’t like — namely, businesses — to the advantage of favored special interests like labor unions.

One ordinance, inoffensively titled the “Clean Campaigns Act,” targets independent expenditures — political advertising purchased by a person or entity without coordination with a candidate.

Historically, however, Washingtonians had the freedom to spend their own money on political speech as they saw fit.  In 1972, voters passed Initiative 276, requiring that political contributions and expenditures be publicly disclosed, thus allowing voters to evaluate whether candidates were excessively beholden to special interests.

Twenty years later, voters passed Initiative 134, imposing limits on how much a person or entity could contribute to a political candidate, with the goal of preventing candidates from being influenced by large campaign contributions. Seattle subsequently adopted even stricter contribution limits, the highest currently set at $500, for city elections.

With contributions to candidates limited to relatively trivial sums, the increasing costs of modern elections have taken the form of independent expenditures not subject to such limits.

Ironically, this has made tracking campaign contributions far more difficult. Often, contributions pass through several political action committees (PACs) before being spent to benefit a candidate. While political insiders still know their backers, voters have a harder time connecting specific expenditures to the original contributors.

Further, as candidates lose control over campaign advertising done on their behalf, negative ads become more commonplace. Independent groups care little if negative ads are unpopular if they work, and candidates can disavow independent negative ads while still benefiting from them.

These issues have, in turn, produced a steady stream of new campaign-finance regulations, both statewide and in Seattle. The increasing complexity of campaign-finance rules presents enforcement challenges and makes political participation harder for regular people, with complete compliance challenging even for sophisticated campaigns.

Unfortunately, the temptation for elected officials to write rules favoring their friends and targeting their opponents, under the guise of preserving democracy and fighting corruption, is irresistible.

Enter the “Clean Campaigns Act.”

As written, the proposal would limit contributions to PACs making independent expenditures in city elections to $5,000. However, there are two ways to avoid this restriction.

First, an entity could purchase independent expenditures on its own. Most businesses lack the resources and desire to develop in-house political operations just to navigate Seattle elections, preferring instead to contribute to PACs operated by professional consultants. Meanwhile, major unions generally already have permanent, internal political teams and many already make political expenditures from their dues-funded general budgets.

Second, PACs receiving only contributions of $100 or less from at least 100 sources — referred to as “limited contributor committees” — could purchase unlimited independent expenditures and contribute up to $10,000 to other PACs making independent expenditures, twice the limit for other entities.

While it would be challenging for businesses to centrally collect the hundreds and thousands of small-dollar contributions needed to form a competitive “limited contributor committee,” many unions already have separate PACs stocked with (usually) voluntary contributions from members. Nearly every national union headquarters maintains such a fund. Unlike their business counterparts, unions’ large, automatic membership base means their PACs would have little difficulty clearing the participation threshold needed to spend unlimited sums on independent expenditures influencing city elections.

Though organized labor wouldn’t gain new flexibility or resources, it would doubtless cheer the hobbling of its political competitors in private industry.

Such anti-speech political favoritism isn’t just bad policy, but likely unconstitutional. The U.S. Supreme Court’s 2010 decision in Citizens United v. Federal Elections Commission and subsequent federal court rulings mean restrictions on independent expenditures rest on shaky constitutional footing, as even progressive legal experts supporting such proposals grudgingly acknowledge.

While independent expenditures have some drawbacks, prohibiting people from spending their own money on political speech is overly draconian. Instead, reevaluating limits on contributions to candidates could prove more productive.

In Oregon, where the state constitution currently forbids campaign contribution limits, independent expenditures are relatively rare.

During Washington’s last statewide elections in 2016, there were $2.56 in independent expenditures per resident, compared to only $0.68 per resident in Oregon’s last statewide elections in 2018. Instead, candidates tend to control more campaign spending.

A second proposed ordinance, up for a vote as soon as Monday, would forbid American companies with even minimal foreign ownership from making political contributions or independent expenditures benefiting candidates. In today’s global economy, this could lock hometown heavyweights like Amazon and others out of city politics.

Then again, it’s hard to view González’s proposals as anything but retaliation for Amazon’s largely ineffective $1.5 million in contributions to a Seattle business PAC in 2019, a timely reminder of money’s limited ability to change electoral outcomes.

No system of campaign finance can totally prevent corruption. But instead of writing complicated, exclusionary campaign-finance rules to benefit political allies, city and state policymakers should work toward a system based on transparency, clarity and freedom of speech, and let democracy do its work.