The Intimidation Game (20 page)

The FEC bureaucracy spent nearly five years trying to take down AIP. But it was hardly an isolated case. McGahn had been keeping track of other examples of unauthorized staff actions.

In March 2012, a Democratic operative filed an FEC complaint against Rick Santorum's presidential campaign. McGahn noted that the complaint was “scant at best”—a whole two pages. It claimed that Santorum had received an impermissible “in kind” contribution from the Michigan Faith & Freedom Coalition (MFFC), since the coalition had allowed Santorum to appear at one of its forums. It also claimed illegal “coordination” between that organization and Santorum's campaign, since the president of the MFFC had volunteered for the Santorum campaign. FEC staff recommended prosecution.

McGahn and a fellow GOP commissioner later dismantled the accusations one by one, in a document rejecting action. It turns out the MFFC had invited all the GOP candidates to speak at an event, but the candidates did not want to speak together. So the group had arranged different venues and invited each separately. Santorum was the only one who agreed to this arrangement. The event was about faith issues, it featured other speakers (clergy members and a doctor), and it did not allow any campaign signs or campaign literature. It was the furthest thing from a Santorum campaign rally. As such, it was entirely legal.

The invitation to all the candidates had meantime been sent out prior to MFFC head Glenn Clark's endorsement of Santorum. Clark endorsed in a personal capacity, not as the head of the group. And he volunteered his time for the campaign, receiving no compensation. There was also no evidence of any coordination.

“Scant” was a polite way of describing the complaint. And “flimsy” was a polite way to describe the staff's recommendation of prosecution. The case wasn't even a close call. Yet McGahn discovered that the staff had in fact spent five months and gone to extraordinary lengths to nail the Santorum campaign with something, anything. And it had once again engaged in an investigation without permission from the commissioners.

As McGahn wrote in his statement opposing prosecution, the staff had “performed extensive research during an extra-statutory investigation,” in which it dug up left-wing news articles that were critical of the Santorum campaign. These included a posting from a blog associated with the far-left
Talking Points Memo Muckraker
website. Staff nonetheless compiled these into a thirty-five-page dossier and shipped them to the Santorum campaign, demanding a response to the accusations.

The counsel for the Santorum campaign (who happened to be Cleta Mitchell) responded to the FEC that she was flummoxed as to why she'd been sent a pile of left-wing talking points. McGahn wasn't so much flummoxed as annoyed. As he wrote, “For almost five years we have asked [the FEC general counsel's office] to provide the authority, even a scintilla of information that would authorize what has become their ever-growing habit of gathering news clips and other materials (that now includes openly biased blog posts) in an effort to supplement the complaint and sending them to respondents long before the Commission considers the matter. Simply put, OGC has been unable to provide authority for their actions.”

These extralegal investigations always seemed to revolve around complaints against conservatives. So too did the unauthorized FEC staff reach-outs to Lerner and the IRS. And so too another form of interaction. McGahn during his time discovered that the FEC staff maintained a policy—undisclosed to the commissioners—that granted itself at-will authority to interact with the Justice Department.

That connection really got rolling after September 2011, after Tony Herman was hired as FEC general counsel. He was joined in early 2012 by Dan Petalas, who was appointed head of the agency's enforcement section. Petalas had spent nearly a decade at the Justice Department. FEC rules make clear that a bipartisan majority of commissioners must vote to refer unlawful conduct to law enforcement. Yet it appears that information was increasingly shipped to Justice without informing the commissioners, much less asking permission.

Much of this content arrived at Justice in the form of confidential reports. As noted, when a complaint is filed against a political actor, the general counsel's office is tasked with writing a report for the commissioners advising them on whether it believes there is a violation. These reports are never made public until a case is closed. Yet FEC staffers blithely handed them over to Justice. On at least one occasion, they sent the report to Justice before they had even sent it to the FEC commissioners.

McGahn publicly highlighted another case, in which Herman's office tipped off Justice to a potential criminal violation by a Louisiana trucking company owner named Arlen Cenac Jr. Cenac was indeed found to have made illegal campaign contributions in other people's names. It was nonetheless up to the commissioners as to whether to refer him to Justice. Instead, the staff made that decision on its own.

It's still unclear exactly what drove some of these abuses at the FEC. They were happening at the same time that the IRS was building its scandal. There are e-mails showing that IRS and FEC staff were talking about similar cases, and Lerner kept ties back at the commission. Once the IRS scandal was exposed, a lot of investigators began wondering just how much unsanctioned, two-way cooperation between Obama agencies was taking place in opposition to conservatives. If the FEC staff was funneling tips to Justice, was Justice influencing FEC staff reports? Was Lerner influencing FEC staff?

McGahn explains that what makes the situation even murkier is the basic character of FEC staff. They are naturally biased. “The place in its early days was staffed by followers of Ralph Nader—Naderites who believed that all politicians are corrupt, and that both parties are awash in too much money,” he says. A younger generation is now in town, but the ghosts still linger. Says McGahn, “Much of that early thinking is still baked into the fabric of the FEC.” The FEC general counsel's office still tends to only hire a “certain kind of person,” he notes. These aren't people “who have practiced law in private practice for any length of time. They aren't people who served as an in-house corporate counsel. They aren't people who have had to help real clients. They certainly aren't people who have campaign experience. They are people coming out of fancy law schools, where they had written an article or two on campaign finance reform and the evils of money. They'd already signed up for a certain way of thinking, and they are true believers.” McGahn recalls, “I didn't see any counterpoint whatsoever. Put them in the right environment, and they'd go and go.”

Evidence of this popped up in later documents that showed the FEC staff had in 2010 reached out to the IRS to provide it formal comments on the FEC's (then) proposed regulations on charitable 501(c)(3) groups. An IRS employee in an e-mail noted that her colleagues were “not aware of a prior instance in which we have sent a formal written comment to the FEC on proposed regulations.” The IRS chief counsel's office nonetheless worked directly with Lois Lerner to draft the document. A majority of FEC commissioners might not have been willing to target certain nonprofits, but a majority of FEC staff was clearly interested in going the same route as the IRS.

Because FEC staff were true believers, they also refused to accept the changed legal environment. “There were cases, like
FEC v. Wisconsin Right to Life
that severely limited the reach of what the FEC could do,” says McGahn. “And there were other cases, in my early years there, that strongly suggested what was going to come in
Citizens United
. But it was like operating in a flat-earth society. Folks at the FEC weren't even close to understanding what was going on, and how much of what they believed was being rejected by the courts. The staff was clinging to a lot of things that had since been thrown out, like a guy in 1982 thinking disco was going to come back.”

Far from embracing reality, McGahn said the staff viewed themselves as a “plaintiffs' advocacy shop, whose job it was to push the envelope, test the law, expand the reach of the statute. If they lost in one court, they'd just go to the next circuit and try again. It was so wholly inappropriate for a federal agency to be doing that. It's not our job to be forging new law.”

The background is why McGahn to this day remains unclear how much of what happened to conservatives at the FEC was deliberate targeting like that at the IRS, and how much of it was plain institutional bias against groups that push for more free speech. “When 99.9 percent of the bureaucracy is obviously Democrat, it's tough to figure out if what they are doing is for partisan gain as opposed to some deep-seated ideological bent. But as a practical matter, it all becomes one and the same, since the ideological policy choice seems to always tilt left and silences the right,” he says.

He's undoubtedly got his stats right. In 2014, the Office of Special Counsel, which investigates illegal political activity by federal employees, settled a case with an FEC lawyer named April Sands, who had spent 2012, according to the OSC, posting “dozens of partisan political tweets, including many soliciting campaign contributions to President Obama's 2012 reelection campaign.” She'd done this despite federal laws against such fund-raising. She'd also “participated in a Huffington Post Live internet broadcast via webcam from an FEC facility, criticizing the Republican Party and then–Presidential candidate Mitt Romney.” Hans von Spakovsky, the former FEC commissioner, would point out that Sands had once worked for Lerner at the FEC. “Quite a ‘coincidence' that an FEC lawyer who was illegally using government facilities to try to get Barack Obama reelected used to work for the lawyer who headed the IRS office that apparently tried to stomp on conservative organizations critical of the same president's policies,” wrote von Spakovsky in the
National Review
. “If there is any agency in the government where employees need to take extra steps in being nonpartisan and politically circumspect, it is the Federal Election Commission.”

Both Brad Smith and Don McGahn make similar points. The left might wish the FEC were more powerful, but in truth the place is plenty powerful already. It freaks out even seasoned campaign lawyers. The mere suspicion that the FEC is gunning for one side and running unauthorized investigations is enough to alter actions and chill speech.

McGahn says that to him the bias is as concerning as outright targeting. “The hard-left elites think regulation is always the answer, and that people need to be controlled. And in their view, whatever the left does is for the greater good, whereas the people who aren't playing by the rules are the people on the right. Those folks annoy and scare them. Lots of the lawyers who end up at the FEC are typical ruling-class elites who view conservatives as backwoods simpletons who aren't smart enough to appreciate all that leftist progress can offer. I was certainly treated that way—because I am Republican, I was dumb, I was a rube, unable to grasp their ‘big thinking.'

“And in a way that is more scary. I'd love to say what goes on is simple partisanship—a desire to ‘get' the right. But it's deeper than that. It's a way of thinking, and in some manner, that's far more troubling, and a worrisome use of government power.”

This was McGahn's insight: that the institution itself needed an overhaul. He'd already witnessed that the staff was primed for action, and willing to take it when nobody was looking. He worried that it might not take much for the place to ramp up into a full-scale IRS-like targeting operation.

A lot of Republican commissioners arrive at the FEC hopeful of getting rid of this or that stupid finance regulation. They quickly discover that getting four commissioner votes to change existing regulations is usually impossible, and whatever change happens quickly disappears after they leave. McGahn decided to focus on the FEC itself. He knew he could expose the FEC staff's behavior; he knew he could tell them not to do it. But given their overwhelming belief in their rightness, and given that bureaucracies operate in the dark, he knew it would just happen again. So instead of focusing on this rule or that enforcement case, McGahn did something very un-Republican (and more like what Democrats do): He focused on reforming the process.

And so he began a years-long battle to change internal FEC procedures. He won several victories, at least on issues that Democrats struggled to defend against. By the time the Republican left the FEC in 2013, the agency had far greater requirements for transparency and due process. Groups that were audited were finally allowed to formally tell their side of the story—which they'd never been able to do before. Groups that were the subject of the complaints were finally allowed to answer queries from commissioners in real time—rather than watch them talk, which is how it had always been.

But McGahn never got his top priority. He sweat blood and tears, working for years to revise the agency's official enforcement manual, thereby putting the reins back on the staff and the commissioners back in control. It was an effort to get “a hold of the process, which was simply rigged,” he says.

His push for a new enforcement manual set the left howling that he was attempting to “block enforcement” and “weaken the agency.” The Republican notes that he didn't want to stop investigations or even stop interaction with Justice. As he says, his only goal was to clarify
who
got to make the decisions: “The presidentially appointed, Senate-confirmed commissioners, who answer to the public, or an unaccountable staff?” The left wants the latter, since it provides more running room to harass conservative groups that engage in free speech.

McGahn's drama over the enforcement manual hit fever pitch in the summer of 2013, in the wake of the Lerner scandal. The Republican gave it one last hurrah, ramping up his reform efforts internally. His new manual proposed to halt staff's unsanctioned interaction with other agencies and require Justice to file written requests or subpoenas to the FEC if it wanted to lay hands on internal documents—which was simply a return to the process of years past. It also would have truly limited staff's ability to launch sweeping investigations without the commission's say-so.