The Intimidation Game (7 page)

Bauer's threats against ALP nonetheless did scare donors, and he'd continue to play the finance card to Obama's advantage, lambasting “special interest” money even as his boss gained from it. Obama would go so far as to use 527s as an excuse to break his own promise to abide by the presidential public financing system; he was the first presidential candidate of a major party ever to opt out. “The public financing of presidential elections as it exists today is broken, and we face opponents who've become masters at gaming this broken system,” Obama would declare in June 2008. “John McCain's campaign and the Republican National Committee are fueled by contributions from Washington lobbyists and special-interest PACs. And we've already seen that he's not going to stop the smears and attacks from his allies running so-called 527 groups, who will spend millions and millions of dollars in unlimited donations.” Democrats would also benefit from “millions and millions of dollars in unlimited donations,” though the press largely failed to note it. And McCain himself stayed in the presidential financing system.

Hillary Clinton's supporters railed against the Bauer attacks. They were floored, and somewhat disgusted, that Bauer would stoop to a Swift Boat characterization of her groups, or that he'd go so far as to threaten her donors with prosecution. But as the primary ended and the party healed, the entire left realized the power of Bauer-like threats and the potential they held to handicap Republicans.

One guy paying attention was Tom Matzzie, a committed liberal political activist. Matzzie's background gave him insight into the power of money and ways to stop it. From 2000 to 2004 he worked as the online mobilization director for the giant AFL-CIO union, building an Internet army of labor activists. He shifted to director of online organization for the Kerry/Edwards campaign in 2004, where he saw up close the Swift Boat attacks. He then moved to Washington director for MoveOn.org, the liberal online mobilization group. He also ran a group called Americans Against Escalation in Iraq, and is credited with raising more than $150 million for various causes.

In August 2008 he founded a new group called Accountable America. As the
New York Times
reported, the organization had but one purpose: to put Republican donors on notice. Matzzie explained that his group intended to send a “warning” letter to ten thousand GOP donors, alerting them, as the
Times
put it, to “a variety of potential dangers, including legal trouble, public exposure, and watchdog groups digging into their lives.” The
Times
noted that the goal was to “create a chilling effect that will dry up contributions” for the GOP side. Matzzie told the liberal publication
Mother Jones
(in a quote eerily reminiscent of Bauer's), “We're going to put them at risk.” He also offered a $100,000 reward to anyone who could gin up a credible civil or criminal case against a conservative independent group.

Matzzie was able to come up with his list of ten thousand GOP donors because of disclosure laws. In the age of the Internet, Matzzie could have his list in a few hours.

And his threats were an escalation of even Bauer's. Like the Obama counsel, he suggested that donors might face prosecution. But he took the warning to a new level, explaining that the left intended to make Republican donors the targets of public smear campaigns—poking into their lives, elevating their profiles, making the world difficult for them. In the gradual escalation of the intimidation campaign, this was a moment.

Meanwhile, Bauer himself was only getting started. He'd tried out his tactics on Edwards and Clinton, and they'd largely been successful. As the Obama campaign moved into the general election, he honed that strategy against John McCain.

Around the time Matzzie announced his intent to harass GOP donors, a conservative group, a 501(c)(4) organization called the American Issues Project (AIP), went on the air against Barack Obama. The organization highlighted the Chicago politician's ties with Bill Ayers, the former Weather Underground member who went to jail for helping bomb the New York City Police Department, the Pentagon, and the Capitol. AIP was partly funded by Harold Simmons, one of the same men who'd given money to Swift Boat Veterans for Truth.

The Obama campaign was livid, and demanded, as is common practice in campaigns, that TV stations pull the ad. Bauer announced that Team Obama would in fact organize supporters to target every station that ran the ads, as well as their advertisers. The campaign mobilized its supporters in particular to go after Sinclair Broadcasting Group, which had dared to run a documentary in 2004 critical of Kerry. Obama spokesman Tommy Vietor bragged that Obama supporters had slammed Sinclair stations with ninety-three thousand e-mails calling for the ad to come down. Some outlets, like CNN, succumbed to the pressure.

Bauer went much further. He sent a letter to the criminal division of the Justice Department demanding an investigation into AIP, “its officers and directors,” and its “anonymous donors.” He claimed the AIP project was a “knowing and willful attempt to violate the strictures of federal election law,” and wanted “action to enforce against criminal violations.”

AIP patiently explained to Justice why it was not in violation, noting that it operated exactly in the same fashion as dozens of liberal groups such as NARAL Pro-Choice America. It pointed out that it had willingly disclosed its donor, Harold Simmons. Bauer's response was a second letter calling for the direct prosecution of the Texas businessman. He sent a third letter on September 8, again calling for action, again slamming AIP's “illegal electoral purpose.”

On the same day, he went to the FEC, demanding that the regulator do something about AIP and Simmons. He also went to the IRS seeking tax documents (to which he had a public right). And he sent a letter directly to AIP hounding it for confidential information (to which he had no legal right). Outside liberal groups piled on, with Democracy 21 filing its own FEC complaint against AIP.

AIP didn't take down its ads. It had the counsel of one of Washington's most hard-charging and effective free-speech lawyers, Cleta Mitchell. But Bauer's effort nonetheless had an effect. A long-ranging one, as it happens.

The Justice Department never did prosecute AIP. Mr. Simmons never backed away from his donations. But the FEC did take note of Bauer's complaint.

Months after the election was over, after Barack Obama was already sitting in the White House, activist FEC attorneys sent an e-mail to an IRS official requesting that she share “any information” she had about the conservative organization the American Issues Project. A mere nine minutes after receiving the inquiry, that IRS official directed her staff to fulfill the request.

Her name was Lois Lerner.

Larry Tribe
is a very smart man. So when the liberal Harvard law professor pronounces, a lot of folk on his side pay attention. Quite a few were reading raptly what Tribe had to say on January 24, 2010.

The left had just suffered an enormous political blow. Three days earlier, the Supreme Court had issued its opinion in
Citizens United
, knocking down a central plank of McCain-Feingold. That finance law had restricted corporations from endorsing candidates in broadcast ads in the run-up to elections. Five justices found this a clear abuse of the First Amendment and struck down those rules.

The president and his party went bonkers. For more than a decade they'd worked to shut up their corporate nemeses, and John McCain had finally got them over the finish line. They'd privately credited the law with aiding in their stunning election victories in 2008. Barack Obama had crushed McCain in fund-raising, and the Democratic congressional election committees had stomped all over their Republican counterparts. The best measure of the law's success, from the Democrats' perspective, was the final tallies of spending from independent groups. Liberal organizations had vastly outspent conservative ones. Shutting up business had been worth the legislative struggle.

And now here was the Supreme Court, undoing all that hard work. Within hours of the ruling, Obama was scolding the justices: “The Supreme Court has given a green light to a new stampede of special interest money in our politics,” the president said. “It is a major victory for big oil, Wall Street banks, health insurance companies and the other powerful interests that marshal their power every day in Washington to drown out the voices of everyday Americans.” Obama would a few weeks later, at a nationally televised State of the Union address, again publicly rebuke the Supreme Court justices sitting in the audience.

Democratic representative Chris Van Hollen joined Obama to complain that the decision would “allow the biggest corporations in the United States to engage in the buying and selling of elections.” The press largely failed to note that Van Hollen ran the Democratic Congressional Campaign Committee, the group charged with electing and reelecting Democrats to the House. Van Hollen knew all about the “buying and selling” of elections, and was frustrated that the price of his buying had gone up.

His outrage was matched only by that of New York senator Charles Schumer, who had only just left the top job of electing and reelecting Senate Democrats. The decision was “poisonous to our democracy,” he complained. The Schumers and Van Hollens were given covering fire from a phalanx of left-leaning groups. Fred Wertheimer of the campaign finance reform organization Democracy 21 pronounced the decision to be nothing less than “a disaster for the American people.”

It didn't matter to Democrats that the Court had in its ruling also freed up their union allies to reengage in elections. Democrats knew that (at least at this time in history) labor unions mattered more in terms of people than in money. They were the boots on the ground, the folks who knocked on doors. Nor did it matter to Democrats that the Court had left in place the long-standing ban on corporations contributing money directly to candidates. (All the
Citizens
ruling did was allow companies to run their own endorsements of candidates in the run-up to an election.)

At least some liberal commentators were honest about why they were so annoyed—and it had nothing to do with clean elections. Jeffrey Toobin, the legal affairs writer for the
New Yorker
magazine, gave his immediate reaction to the ruling: “Two thoughts. First, Republicans will benefit, of course. Corporations have vastly more money than unions and corporations by and large prefer to support the G.O.P.” Toobin consoled himself that perhaps companies might face consumer boycotts if they spent too much money in support of “Barack Obama's opponent in 2012.”

But what most worried the left about the ruling was the political climate. In August of the prior year, Democrats had gone home for summer break to face a tsunami of outrage over Obamacare. Public anger hit breaking point in the late fall, as both the House and Senate passed versions of the bill. And then in January, Republican Scott Brown won a special election to the Senate in deep-blue Massachusetts. Democrats saw in that GOP victory in Massachusetts the makings of an electoral revolt that might sweep them back out of Congress, and perhaps out of the White House. Two days later, the high court issued
Citizens United
, turning Democratic worry into panic.

The question, though: What to do? The parties had dueled over campaign finance law for generations, each side using “reforms” to lard more restrictions on their political opponents. The courts had largely gone along with the exercise, unwilling to buck public sentiment. Yet now the Supremes had found a constitutional right for companies and unions and independent political groups to speak freely in elections. It was an expansive decision. And that meant the tool that professional politicians had relied on for so long—the outright silencing of political speech via government regulation—was no longer at their disposal.

“The left found itself at a high-water mark in 2010; it had knocked completely out of public discourse most of the free-market voices out there. It hadn't needed intimidation or retaliation, because it had simply censored the other side,” says Lee Goodman, one of the current Republicans on the Federal Election Commission. “Then came
Citizens United
, and it couldn't censor outright anymore.” Goodman continues, “Of course, the left didn't give up on the idea; it just realized it had to be far more creative about suppressing speech. And so it moved to plan B, which was to find other levers of government power to eliminate unwanted viewpoints.”

Tribe, in his article that appeared just a few days after the ruling on the popular
SCOTUSblog
, partly laid out that plan B. The law professor offered some fairly dry legal analysis of the decision, before moving on to the meat of his proposal. Companies that engage in elections, explained Tribe, were doing so with “other people's money”—that of shareholders. That justified the federal government's passing legislation to help shareholders “ensure that his or her investment is not deployed to advance or obstruct the election of particular candidates to federal (or indeed, state) office contrary both to that shareholder's own wishes and, more importantly in this context, to the corporation's business interests.” At the very minimum, said Tribe, Congress should dramatically beef up “disclosure and disclaimer requirements” forcing CEOs to have to publicly explain in each ad how much money was being used, and how it supposedly helped the company. And that, explained Tribe, would be as good as a ban: The process of requiring companies to go public would embarrass them out of participating.

Cut out the legal jargon, and Tribe was advocating something extremely simple: humiliation. Force companies to have to justify their speech, and bet that this would intimidate them out of doing so. The Tribe prescription was an amplification of Toobin's thought on boycotts. Companies live in fear of shareholder or customer backlash. So the left needed to pass enhanced disclosure laws that would make companies fear that backlash. And those disclosure laws would, as a bonus, give Democrats more information, allowing them to go after specific businesses and damage their reputation if they came out for the wrong side.

Tribe's essay wasn't novel. It was more the public announcement of a strategy that had been in the works for months. Democrats had always understood that the Court might rule against them in
Citizens
, and they'd been preparing a response. That's why President Obama, just hours after the decision, announced that he was telling his administration “to get to work immediately with Congress on this issue. We are going to talk with bipartisan congressional leaders to develop a forceful response to this decision. The public interest requires nothing less.” Obama already knew what that response would be.

When Ted Olson looks back, he wishes he'd focused a bit more on the disclosure question. But hindsight is always 20/20 and—at least at the time—what he was understandably focused on is what he calls “the big banana.” That “big banana” was the limits on corporate participation in elections. Olson argued the case on behalf of the free-speech contingent, and is one of a handful of brave souls who can take credit for the Court's striking down those limitations.

One of Washington's more high-profile lawyers, Olson was an interesting choice for the assignment. George W. Bush tapped him at the beginning of his first term as solicitor general. Bush's signature on McCain-Feingold set off a series of court fights, and Olson successfully and dutifully defended parts of the law on the president's behalf in 2003. Only six months later he returned to private practice at the respected firm of Gibson, Dunn & Crutcher, where he rejoined the ranks of free-speech warriors.

Americans think most Supreme Court cases are happenstance. Some random citizen—a Margaret McIntyre—suffers an injustice, and her case slowly wends its way to the highest court in the land, where precedent is set. That does happen. But just as often, cases are engineered. Dedicated lawyers and activists look at laws and identify potential challenges. They pick through scenarios and attempt to create a situation—a set of circumstances—that forces courts to act. That was the history of
Citizens United
.

David Bossie came of political age in the Clinton scandal years, joining a conservative nonprofit called Citizens United. He spent a number of years doggedly researching the shady financial practices of the Clintons, and became the group's president in 2000.

Bossie ultimately turned Citizens United into a movie studio, devoted to conservative documentaries that might aid in elections. He wasn't the first to come up with the idea. Liberal filmmaker Michael Moore had created
Fahrenheit 9/11
, his hit job on George W. Bush's war on terror, with the aim of influencing the 2004 presidential race. He debuted it five months before election day, and publicly admitted that his goal was to energize anti-Bush forces and increase turnout for John Kerry. Moore's documentary was technically a movie—covered completely by the First Amendment—yet every time a thirty-second promotion for it ran on TV, it was the functional equivalent of a campaign ad.

Bossie noticed. He reached out to James Bopp Jr., a lawyer who'd made a reputation forcing the Supreme Court to confront the free-speech hypocrisies of campaign finance law. He'd already helped strike down part of McCain-Feingold. Bopp ended up working with Bossie on
Hillary: The Movie
, an exposé of the former First Lady's business dealings and checkered political past. Under Bopp's guidance, the documentary team took special care to craft the script in a way that would challenge several provisions of McCain-Feingold, including its ban (by companies, unions, and outside groups) on issue ads in the run-up to an election, as well as its disclosure regime. And then Citizens United prepared to roll it out in 2007, to tie it to the presidential election and force the constitutional question.

“The movie was designed to highlight the absurdity of this law,” says Bopp, who works out of Indiana. “We started out with a big advantage in this case—we had the law on our side. ‘Congress shall make no law'—that's a command, not a suggestion. How can a movie about Hillary be legal, but an ad about the movie not be?”

Citizens United went straight to the FEC to get a ruling, and, unsurprisingly, the FEC ruled that it was in essence an election ad, barred by McCain-Feingold. The group appealed it up, and a federal court upheld the bar on running any TV ads or video-on-demand. When it came time to argue it to the Supreme Court, Bossie enlisted Olson, who he knew held a stellar track record in front of the high court.

Olson felt that the best way to win the case was to keep it focused on that “big banana”—the basic question of free speech. So he narrowed the scope. “We were thinking about disclosure, because it was also an issue in this situation. There was an important point about just how much disclosure this little group ought to be forced to do under McCain-Feingold, and would they be harassed or intimidated,” he recalls. “But we really wanted to win on the unconstitutionality of restricting the use of money and speech per se, and we were worried if we took too much time in the [Supreme Court] briefing on the disclosure point, we'd weaken our ability to get that big banana.”

Olson also (wisely) bet that the Court would want a “fallback”—a way to soften the blow of the decision. And he bet that that fallback might be the Court's full embrace of the law's disclosure regime. He couldn't have been more correct. The decision, written by Justice Anthony Kennedy, was bold on the free-speech point. The Court had spent years coddling the finance-restriction crowd, but the
Citizens
case highlighted too many inconsistencies. So five justices took a strong stance on the First Amendment, restoring the rights of many groups to take part in elections. At the same time,
all
the justices knew that the decision would be met with a firestorm, and most wanted political cover. Their “fallback”—to use Olson's word—was to hail McCain-Feingold's disclosure rules. Kennedy even argued that those disclosure provisions were what had allowed the Court to more fully embrace free speech. “The First Amendment protects political speech; and disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way. This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.” Eight of the justices would ultimately join in the part of the decision upholding disclosure.

Olson still thinks it was the correct call at the time, and he's right. “It was a tactical thing; we didn't put a lot of energy or enthusiasm into the disclosure question,” he says. “And remember, this was a moment at which a lot of people on the conservative side of the spectrum embraced that view. Their argument to the left was, ‘Why are you complaining about more free speech? If we just have disclosure, everything will be open, and that is the remedy.'”