Michigan campaign finance rules weak; reform prospects unclear

There are limits to the amount of money you can donate to the candidate of your choice in Michigan. But, as with other elements of Michigan's lobbying and ethics rules, the state's campaign finance limits are somewhat loose.

Under current law, an individual can donate $500 to a candidate for the state House, $1,000 for a state Senate candidate and $3,400 for statewide offices such as governor, attorney general and secretary of state in a single election cycle.

An individual can contribute a maximum of $20,000 to a House or Senate caucus committee each year. Those caucus committees -- think Republican and Democratic parties -- can give an unlimited amount of money to House and Senate candidates of their choice. This gives a citizen the chance to double-up: $500 directly, say, to a favored House candidate, who also receives help from her caucus committee.

Citizens also can send unlimited amounts of money to all other types of political action committees, or create their own. Those committees have various limits on how much they can give directly to candidates, but they also can spend unlimited sums aiding a candidate -- so long as such efforts do not advocate the specific election or defeat of him or her.

“That has really resulted in a massive flow of what is money laundering,” said Rich Robinson, executive director of the watchdog group Michigan Campaign Finance Network.

There are numerous other flaws in the laws, Robinson said, most noticeably, regarding spending on issue ads.

On the bottom of the cover of the 2010 citizen’s guide to Michigan’s campaign finance, there is a warning label that looks as if it came off a pack of cigarettes. It reads; “undisclosed political spending is a threat to democracy and the public interest.”

Robinson, who puts out the guide, said the threat grows larger each election cycle. Since 2000, more than $70 million has been spent on issue ads on television stations around the state -- but none of the spending has been disclosed.

“Our disclosure system is just missing a lot of what is going on,” Robinson said.

Because those types of ads -- which do not specifically advocate for the election or defeat of a candidate -- are not considered campaign expenditures, they don’t fall under the state’s laws of campaign finance reporting. 

The amount is known because Robinson travels around the state and compiles the information from the public files at the individual television broadcasters and cable systems.

But, he said, even when he can find a way to show how much money is in the system’s blind spot, there is no law that allows the public to see who or what special interests contributed to those groups to pay for the ads.

In the 2010 election, more than $20 million was spent on issue ads for the major statewide races, about a third of all spending in those races.

When the House Democrats recently unveiled a package of campaign finance reforms, Robinson said he was saddened to see it did not address issue ads.

“It explicitly went around the idea of electioneering communications,” he said.

Tom Shields, president of Marketing Resource Group political consulting firm, said both Democrats and Republicans see an advantage in having the option of using issue ads.

“I doubt we’ll ever see any type of reporting on issue advocacy,” Shields said. “There’s been a fairly long history and place for them in Michigan politics.”

Rep. Pete Lund, R-Shelby Township and chairman of the House Redistricting and Elections Committee, said the problem with regulating issue ads is the First Amendment, but overall he believes in transparency.

“I think it’s a good policy to put your name on what you say, but that doesn’t mean the government can force you to do it,” he said.

Robinson has been leading the call for years for campaign finance reform, but the lawmakers who benefit from keeping the system as it is never make the big changes he feels are necessary, he said.

Not everyone sees this as a problem, though.

“The fundamental problem with campaign finance reform is the Constitution and 30 years of litigation,” said Steve Linder, a partner with the Sterling Corporation and one of the more prolific Republican fundraisers in town.

Linder has raised close to $500 million for candidates, causes, issues and associations since becoming a professional fund-raiser in 1978.

He said there is no proof that money has s a corrupting influence in politics, suppresses voter turnout or only leads to rich people getting elected.

“There is not a shred of evidence,” he said.

If true, Dick DeVos would have been governor for eight years rather than Jennifer Granholm, he added.

With issue ads, he said people make decisions based on the issue, not on who gave the money.

A problem with disclosure of such ads involves groups that have multiple issues they advocate for. Linder said if someone writes a check because they believe in one cause the group is fighting for, but not another, should that person’s name be disclosed as a donor for an ad that advocates for something they oppose?

“That’s just a hazard that a contributor faced,” Robinson said.

If the state was going to make changes to its campaign finance laws, Linder would suggest eliminating contribution limits. Putting limits on how much a person can donate only moves more of the power of fundraising to third-party groups, he argues.

“Let (people) give whatever they want, as long as it is disclosed,” he said.

He would support moving to a quarterly reporting system or even real-time reporting of contributions. Back in 2006, then Secretary of State Terri Lynn Land urged the creation of a real-time reporting system on campaign contributions, including a provision that would bar the use of contributed funds until they were publicly reported. The Legislature ignored it.

Rep. Barb Byrum, D-Onondaga and minority vice chairwoman of the House Redistricting and Elections Committee, said the state needs to clean up its elections and increase disclosure.

"We need to make sure our campaigns are more transparent,” she said.

In his State of the State address earlier this year, Gov. Rick Snyder did call for more campaign finance reforms, but the Legislature has not moved any reforms to his desk for signature.

MCFN's Robinson said he was thrilled to hear that portion of Snyder’s speech, saying he was the first governor since Bill Milliken to express any concern about the issue.

“My hope is," Robinson said, "if the governor puts some of his prestige on the line, we might have a real opportunity to make a difference."

Chris Gautz is a reporter for the Gongwer News Service in Lansing. Prior to joining Gongwer, Gautz reported for the Jackson Citizen-Patriot and the South Bend, Ind., Tribune. He is a graduate of Central Michigan University.

This story was published as part of a collaboration between Bridge Magazine and Gongwer News Service.