Influencing an Election | Campaign Finance

Influencing an Election | Campaign Finance


If you’re anything like me, after a hard
day of work, you like to head on down to the 99 cent store… Maybe grab yourself a candy bar or a new pair
of socks. You slap your Washington on the table and
expect your penny back. But these days, there are people who don’t
want you to get that penny back. People who think the business would be better
off keeping that penny – they probably know how to spend it better than you would anyway. Pennies cost too much to make or simply aren’t
worth the hassle. Now, I may be a simple man, but I don’t
think counting by ones is all that difficult. I work hard for my money and I should be able
to keep it. Every single cent. A penny saved is a penny earned. Not paid for by Americans for Common Cents. This video was legitimately brought to you
by CuriosityStream. This one’s not a joke. Most every politician, when asked about campaign
finance reform, will agree that it’s a problem and we should do something about it. Usually to the sound of roaring applause. It’s one of those things like supporting
the troops, regardless of what side you’re on, everyone claps. Because everyone wants that. We all know that money in politics is a big
problem… but I’m not sure we all understand how. That was the attitude I had when I started
making this video. I want money out of politics, I started making
this video with that end goal in mind and now that I’ve made the video, I still want
money out of politics. I’m just not sure how… or even why? In order to figure out how we got where we
are, we need to look to the past, and most discussions about campaign finance start with
the Citizens United decision in 2010. On Twitter, I asked you to describe the Citizens
United ruling in your own words and even after a hundred different answers, I’m sorry to
tell you that nobody got it 100% correct – and most people were way off. Don’t worry, before making this video, I
would have said the exact same things you did. Like how the Citizens United case declared
corporations to be people, money to be a form of speech, allowed unlimited campaign contributions,
allowed corporations to contribute to campaigns, and created SuperPACs. It might surprise you to hear this, but it
did none of these things. Corporate personhood is a concept that goes
back centuries; they’re able to sue in court, enter into contracts, and own property. But an 1886 decision stated they had many
more rights under the newly written 14th Amendment. While the case was originally about taxes,
the decision basically gave the green light to corporations to exercise their right of
free speech. So, that’s one off the list – they don’t
have all the same rights as people, but they do have some. The infamous 1972 Watergate scandal was ultimately
a campaign finance violation that they tried to cover up, which caused Congress to pass
several new laws restricting money in politics. As a result, the Federal Election Commission,
or FEC, was established in 1975. Their sole purpose is to enforce campaign
finance law and to disclose contribution information to the public. Before them, it was basically the wild west. A year later, a Supreme Court case was heard
which challenged many of those new laws, most notably, campaign contribution limits. We all have the right to free speech, including
corporations. But the court also ruled that we have the
unlimited ability to use money to amplify or enhance our own speech, should we choose
to. Not to give unlimited amounts to candidates
– that was and is still against the law. But under the first amendment, there’s nothing
stopping you from buying a megaphone, or having flyers printed up, or running ads on TV to
get your message out, whether it’s political or not. Money itself isn’t speech, but it runs parallel
to speech. That’s another two decisions falsely attributed
to the Citizens United decision, not only did this older case state that using money
to enhance speech is legal, but limiting that ability is unconstitutional. Though things get a little tricky because
of the word “contribution.” When it comes to campaign finance, a contribution
is any thing of value given to a candidate or party to influence an election. Saying things on your own, separate from the
campaign, isn’t necessarily a campaign contribution. So, here you are, an individual, not a politician
or a CEO, just a regular person with a regular boring job. You have the ability to speak freely, and
if you have the money to do so, you can run advertisements on TV saying basically whatever
you want within various laws. We’ll contrast this with a corporation,
who can also speak freely and run advertisements, which they do all the time. Now let’s say someone just like you wants
to run for federal office. They could pay for their own advertisements,
but they can’t afford it. You like the positions they hold and you want
to help them by giving them some money. This is a campaign contribution; it has to
be reported to the FEC and is limited to $2800 per election, though this number is tied to
inflation and changes every two years. This is known as “Hard Money” and most
people don’t really have a problem with this, this is the system as intended. If people have a problem with it, it’s usually
the limit. They wish they could give more. If you decide to cut out the middle-man and
just run your own advertisements, if you mention that people should vote for Candidate-X, that
is an “in-kind contribution” and is subject to the same disclosure rules and limits – so
you can only spend $2800. But let’s say you wanted to do more, you
don’t just believe in Candidate-X, you believe in Party-X, and you want to help them get
elected nationally. No problem, you can also write them a check,
your identity will need to be disclosed to the FEC and you’re again limited, but to
$35,500 a year. Since the party will use this money to run
advertisements to help get its people elected, this is also hard money. In 1978, the FEC made an administrative ruling
which stated that donating to a political party for election purposes was subject to
campaign contribution limits. This is called electioneering, and it’s
a somewhat important concept. If I run an advertisement for or against any
candidate or in support of or opposition to any ballot proposal, that’s electioneering. President Abraham Lincoln, perhaps our greatest
American president, he freed the slaves, preserved the union, and lost his life because of it. But there are those who would see his memory
erased. They would remove the daily reminder of what
this president did from your very own pocket. Vote No on Order 66 and keep the penny. Not paid for by the Four Score and Seven Years
Society. That’s not illegal, you are allowed to electioneer
under the First Amendment. But, you have to follow the rules. If you wanted to donate to a political party
just because, out of the kindness of your heart, as long as they don’t use it for
electioneering, the sky is the limit. You can donate to a political party for electioneering
purposes with a limit or for “party building activities” with no limit. This is called “Soft Money” and it is
completely legal – this is where most people start to raise an eyebrow. So, let’s bypass the party, you and a bunch
of your neighbors get together to help get the candidate you support get elected, an
honest grassroots effort. Citizens for Candidate-X. You pool your money and start running advertisements. A quick note here, I keep saying running advertisements
and you probably picture TV commercials, which is definitely part of it. But it’s also literally everything else. Did you have t-shirts made? Lawn signs, post cards, youtube videos? All of that counts. Citizens for Candidate-X, despite being an
innocent gathering of citizens, is also a Political Action Committee, or PAC. These aren’t just shady groups of rich people
trying to steal elections. If you start an anti-litter campaign in your
neighborhood, depending on where you live and how much you raise, you could be legally
obligated to form a PAC. Generally, if you put all of your money in
one pot, it’s supposed to be a PAC. There are many different types of PACs, they
can be set up by a candidate or party, or associated with a business or industry, or
represent a group of people, or be totally issue-focused. What determines whether your money is hard
or soft, and subject to limits or not, is what the PAC does with that money. If they run electioneering ads, where they
tell you to support or oppose anyone or anything, that’s subject to disclosure and limitation. But if you run ads that just vaguely suggest
counting by ones is easier, no disclosure, no limitation. Because the PAC isn’t giving the candidate
anything directly or indirectly, it’s not a contribution, it’s an “independent expenditure.” They’re just running their own ads over
there, completely separately. PACs can coordinate if they’re doing electioneering,
telling people who to vote for, but they can’t coordinate if they’re doing independent
expenditures, where they just want to educate or whatever. As you can probably guess, it’s a very fine
line. So, PACs can run soft money advertisements
where they just tell you about an issue without telling you how to vote. If you have enough money, you as an individual
can too, you have the right to free speech. Corporations on the other hand… Corporations cannot give campaign contributions
to candidates, political parties, or political action committees. They also can’t pay for electioneering ads
where they tell you how to vote. But they can run ads that say something vague
like “support America’s copper and zinc industry.” Because that’s an independent expenditure,
not electioneering. People are allowed to get together to form
PACs that pool resources and spend money on electioneering and independent expenditures. And it’s the electioneering part of the
PAC which causes all the trouble; corporations can’t participate, there are limits, and
donor information must be disclosed. So… what if we made a PAC that only does
independent expenditures? Suddenly, there are no rules. People and corporations can donate unlimited
amounts of money, and as long as the PAC doesn’t participate in electioneering, it’s totally
legal. These are more commonly known as SuperPACs,
and depending on the type, they don’t have to disclose information about their donors
to the public, making this “Dark Money.” Dark money is just soft money that we don’t
know immediately the source of. In 1990, there was a Supreme Court case which
decided that corporations were allowed to donate to independent-expenditure-only PACs,
as long as it was from a separate fund, not the general treasury. Which slows the process down by what? Two clicks? This was the unofficial birth of the SuperPAC
– a Political Action Committee that only does independent expenditures and doesn’t
participate in electioneering. Officially, they are called independent-expenditure-only
PACs. The 1990 decision didn’t allow corporate
contributions, those are still illegal, but it did allow unlimited independent spending. And since people can get together and do that
in a PAC, this decision effectively allowed corporations to do the same. So, looking at this list now… what did the
Citizens United decision actually do? In 2002, the Bipartisan Campaign Reform Act,
better known as the McCain-Feingold Act was passed which established a few rules that
changed the way campaigns were financed. Though they were mostly minor changes. They increased the amount of hard money you
could donate to candidates and parties and tried to limit the amount of soft money they
could raise. But only for candidates and parties, not PACs. It’s also the reason you hear people saying
they approve this message at the end of their ads… I’m Barack Obama and I approve this message. I’m John McCain and I approve this message. That way you can tell if they ad is actually
from the candidate, rather than a PAC or whoever else. But most relevant to us, it barred corporations
from running electioneering communications in the 30 days leading up to a primary and
the 60 days leading up to a general election. It also redefined electioneering as anything
even mentioning a candidate. So, to visualize this, the McCain-Feingold
Act only affected this stream by not allowing them to show ads for 90 days out of every
other year. Which seems like the opposite of what I’d
want? When they say you can’t do it during that
30/60-day window, they’re also saying you’re totally allowed to do it during the other
275 days of the year. I think I’d rather have it contained to
just before the election, but that’s just me. In 2008, a PAC known as Citizens United wanted
to run ads for their Hillary movie during the 30-day window before the primary, and
they couldn’t… so they sued. And spoiler warning, in 2010, they won. So, what did this decision actually do? It overturned the 30/60-day ban on corporate
soft money spending, which only existed for a few years at that point. The court felt that limiting free speech just
before an election runs counter to the intention of the First Amendment. It didn’t declare money to be speech, it
didn’t allow unlimited corporate spending, those things were already allowed. It also didn’t create SuperPACs, they had
been around for decades. Citizens United, the group that caused all
this fuss, was created in 1988. The Supreme Court also overturned that 1990
Michigan decision, so now corporations could give to SuperPACs from their general fund,
rather than having to create a separate one. They closed the loophole and just let them
use the regular hole. Which honestly, they were doing anyway, just
one step removed. But perhaps most importantly, while this case
didn’t really change much in terms of federal elections, its biggest impact was on the states. This decision effectively overturned any state
law which limited corporate soft money spending, loosening state election laws to be more in
line with the federal guidelines. Which is to say, very loose. Two months later, the SpeechNOW.org decision
effectively extended those same rights to individuals. Now, anyone could give unlimited soft money
donations. Remember, people could already do these things
and had been for decades. But now they had the green light from the
Supreme Court. To be fair, historically, the Supreme Court
has almost always been on the side of more free speech, which is what this is… We just don’t like it. Almost everyone agrees that we have too much
money in politics – this is the problem people want to get rid of. So, it’s probably a good idea to define
what this means. What is politics? Is this political? You might not think it, but to some people,
this is a very blatant political statement. A clothing company paying an athlete to take
some pictures of him while wearing their product, seems innocent enough. But because of what that athlete did a few
years ago, some people interpret this as a corporation opposing a political candidate. So I’ll ask again, is this political? It certainly isn’t overtly political, but
neither is “Support America’s Petroleum Industry.” It seems like it’s only political if you
disagree with it. Politics that you agree with is just “common
sense.” But other people wanting to have the option
to pick a non-white male main character in a video game… Ugh, why’d you have to make it political? With that understanding of politics, the issue
isn’t really “money in politics” – but money in politics you disagree with. Because if you agree, it’s not politics. So, let’s shift to the money side of the
problem – we all agree that there is too much money in politics. But… what is too much? The 2016 presidential election cost 2.38 billion
dollars… which is about half a billion shy of the most expensive, which was 2008. Which was before the Citizens United decision. In fact, when you account for inflation and
population, presidential campaigns have cost roughly the same amount over time, with a
few notable exceptions, especially recently. But Congressional races have been getting
more expensive, with the cost nearly doubling in the last twenty years. The most expensive federal election, accounting
for inflation, was 2012 at 6.85 billion dollars… which sounds like a lot of money. But dog grooming is a 9 billion dollar a year
industry. I think there is too much money in politics,
but when it’s less than one of the most extra industries I can think of… maybe it’s
not too much? I don’t know what the right number should
be. Federal candidates who ran unopposed still
ended up spending over a million dollars on their campaigns, each. So maybe it’s not the amount that’s the
problem. On Twitter, I asked you all a series of questions
about what you think should be legal when it comes to campaign finance. Most of the questions returned similar results,
until I got to these two… take a moment to read these over and ask yourself – what
is the difference between these two scenarios? In both cases, a group of people who work
at the same place made a commercial that will ultimately benefit the company. Even the difference that seems obvious, isn’t
really. They all get their paycheck from the same
place. So really, the only difference between these
scenarios is if your heart is in the right place. Which is impossible to regulate! Even if you made a rule saying companies cannot
participate in independent expenditures, what’s to stop a bunch of coworkers from doing it
completely on their own and then getting a nice holiday bonus conveniently timed just
after the election. They’ll say it was completely unrelated…
but… What it really boils down to is that people
don’t want corporate money in politics. This soft and dark money stream is the one
most people seem concerned with, corporations either on their own or as part of a SuperPAC
running mostly issue-based ads that aren’t technically electioneering. So, what is a corporation? Most of us immediately think of Google, Amazon,
ExxonMobil, Monsanto… You know, the big evil ones. But also, that mom and pop restaurant on the
corner and many YouTube channels are corporations. Charities are corporations. Under the IRS code, they’re what’s called
a 501c3 Organization, these are Charitable Non-Profits like the Red Cross. Donations are tax deductible, are limited
to 50% of your annual income, and must be disclosed to the IRS. They are not allowed to directly participate
in politics, except in a general assistance capacity like driving the elderly to the polls. In fact, when we look at our handy chart,
all of these are corporations. 527 Organizations are Political Non-Profits,
this includes all political parties, political action committees, and some SuperPACs. Contributions are not tax-deductible by the
donor, but the organization does not pay taxes on it. Contributions are subject to a limit depending
on what the organization uses the money for, whether it’s hard or soft money. 527s must also disclose who their donors are
but are only required to do so quarterly. So you may not find out who paid for an ad
until after the election. These groups can participate in electioneering,
independent expenditures, or both. But there is another popular choice which
organizes under section 501c4, these are Social Welfare Organizations, like the National Rifle
Association, Planned Parenthood, and just over half of all SuperPACs. Again, contributions are not tax-deductible,
but the organization is exempt from paying taxes. There is no limit to the amount you can donate,
since these groups are only allowed to participate in independent expenditures, and only if it’s
less than half of their total spending. That’s how they remain a social welfare
group, rather than a political one. There’ve been a few challenges to this in
recent years, but as of making this video, 501c4s do not have to disclose their donor
information at all. Ever. So when we look back at our chart, 527s can
take limited hard money or unlimited soft money, and must make donor information publicly
available… eventually. 501c4s can take unlimited soft OR dark money
and do not have to disclose. If you’re not already, you might want to
sit down… because all of these can give to each other in various amounts depending
on who it is and what they use it for. In the end, while there isn’t supposed to
be any foreign money in our elections, after it’s been passed between a few corporations,
PACs, and SuperPACs, it’s been effectively laundered and could end up anywhere. The same can be said about corporate money,
it’s nearly impossible to track, since again, all of these are corporations. Including things you might not think of, like
Labor Unions… Hint hint. And even professional organizations like the
American Psychological Association and the American Medical Association. Are we really expecting them to stay quiet
on something like healthcare policy? Really, when it comes to corporate money in
politics, I don’t want it, but I also don’t see how we can get rid of it. It is a slippery slope situation. If we want to get rid of all money in politics,
that means you can’t go and print up flyers for your anti-litter campaign. So obviously some money has to be allowed. On the other end, currently, both of these
are allowed, corporations can’t endorse a candidate, but they can do independent expenditures. Like many of you, I kind of wish they couldn’t. I would move the line down here, but I don’t
know how I can justify saying that businesses can’t participate, but labor unions, professional
organizations, and political action committees can. Because remember, they’re all corporations. I don’t know how to stop bad actors, without
also stopping good actors. So why make this video then? Why explain all of the intricacies of campaign
finance if I’m just going to tell you that I don’t know the answer? Because some people, including PragerU, claim
to know the answer – I’d give you two guesses, but you’ll only need one: it’s
deregulation. And I obviously disagree. But on the flip side, simple solutions like
“overturning Citizens United” wouldn’t do much either. So… you’re going to reinstate that 30/60-day
ban on some soft money spending? That doesn’t seem like it’s going to solve
much of anything. Most of the stuff people don’t like is already
illegal, SuperPACs are not supposed to coordinate with candidates or run electioneering ads. But in practice, they do it all the time and
they’re just not punished for it. The documentary Dark Money looks into several
of these cases, and while it is a fantastic bit of investigative journalism, I feel compelled
to remind you that everything they look into is already illegal. We don’t lack regulation, we lack enforcement. Over the decades, the way corporations have
sought to curry favor with politicians has changed, it might surprise you to hear that
traditional lobbying has fallen out of favor. Campaign contributions and SuperPAC donations
are all the rage now. There is actually very little evidence that
money changes minds, politicians don’t really go from anti- something to pro- something
because of a donation. It’s much easier and cheaper to find someone
who already agrees with you. So rather than try to recruit a mercenary
politician, they look for a principled activist they can amplify. There’ve also been calls to close the “Revolving
Door” in DC. This is when someone from the private sector
gets into a government position, changes a bunch of regulations, then goes back to work
at whatever corporation they left. But how can you meaningfully stop that? This is America, are we really going to make
laws about who you’re allowed to work for after being in government? That doesn’t sound right. Even if you implemented a five-year waiting
period, that would become the contract start date. Some people even take issue with politicians
writing books or giving speeches after leaving office. I’m not sure I want to tell people what
they can do with their lives after they’re done serving the public. I don’t know about you, but after a few
years of public service, I like to sit back and watch one of the many great documentaries
on Curiositystream, by going to curiositystream.com/knowingbetter. Curiositystream is a subscription streaming
service that offers over 2400 documentaries and nonfiction titles from some of the world’s
best filmmakers that you can access across multiple platforms. They even have a series about money’s influence
on American history, including an episode specifically about the Watergate scandal – see
how one corrupt politician started this entire campaign finance disaster. You can get access to their entire library
for as little as three dollars a month – actually, that’s not true, it’s 2.99 a month. They let you keep the penny, like all good
Americans should. If you head over to curiositystream.com/knowingbetter,
and use the promocode knowingbetter, they’ll even throw in the first month for free. As well as getting access to Nebula, the new
streaming service built by fellow youtubers to create videos without worrying about pesky
limitations or disclosure rules. Including several original series like Working
Titles, hosted by a different creator each week, talking about their favorite TV show
opening credits – I heard a rumor that I might be doing one of these in a few months. By joining CuriosityStream and Nebula, you’ll
also be supporting the channel. With everything I’ve told you today, I think
it’s important to remember that none of this money ever actually reaches the politician’s
pockets. This isn’t lobbying or old-school bribery. The six billion dollars we spent on the last
election ended up going to the people who make commercials and lawn signs, the campaign
staffers, and the venues where you hold your rallies- Or wine caves, I guess. While we may think that elections cost way
too much, that money ends up circulating in the economy. And restricting that is complicated. I want to find a way to realistically keep
our elections as ideologically pure as possible, but hopefully now you won’t accept simple
solutions like deregulation or overturning a court case, because it’s more complicated
than that, and now, you know better. I just started accepting Youtube memberships,
if you’d like to have a snazzy fork next to your name and get access to the newly revamped
members-only discord, hit the Join button down below. If you’d like to add your name to this list
of soft money donors, head on over to patreon.com/knowingbetter, or for a one-time donation, paypal.me/knowingbetter. Don’t forget to coordinate with that subscribe
button, check out the merch at knowingbetter.tv, follow me on Twitter and Facebook, and join
us on the subreddit.