Policy Lab is assisting Citizens for Responsibility and Ethics in Washington (CREW) will be investigating the influence of payday lending services in crafting the state-level financial regulations under which they are governed.
RESEARCH QUESTION
Policy Lab is working with Citizens for Responsibility and Ethics in Washington on an investigation of how payday lending services influence state-level financial regulations and crafting policy recommendations on how campaign finance laws can be tailored to limit the their influence.
BACKGROUND
In Citizens United v. Federal Elections Commission (2010), the Supreme Court overturned its own precedents by allowing corporations, labor unions, and certain other organizations to participate in federal elections through independent expenditures. While restrictions had already begun to erode before the decision, such entities were nevertheless much more strictly limited in terms of the kinds of direct political spending they could engage in. Now, as long as these activities are uncoordinated with a political campaign and don’t make up a majority of the group’s activities—facts that are very difficult to prove—these groups have no limits on the source or size of contributions for political communication. Another outgrowth of the Citizens decision has been the growth of federal electioneering spending by nonprofit organizations (primarily 501(c)(4) corporations as defined in the tax code), which are not required to report the sources of their donors. These nonprofit organizations have grown to become a significant source of spending and issue advocacy in both state and federal elections. As these organizations are not required by law to disclose the sources of their funding, it is impossible for citizens to assess the influence that special interest groups have on politics. The funds raised have come to be deemed “dark money,” due to their lack of transparency. The role of this spending at the state level—which is far less visible and under much less scrutiny than federal elections—presents the potential for far greater distortion of the elections and policymaking process by these interest groups and large financial resources they bring to bear. Spending at the state level, dollar for dollar, goes a lot further than federal spending, and there are a wider variety of positions that are up for grabs. For example, many states hold judicial elections, which are increasingly subject to spending by outside groups, including dark money groups.
Project Partners: Jennifer Ahearn, Director of Policy and Robert Maguire, Director of Research. CREW.
Faculty: Zachary Courser, Co-Director; Stan Oklobdzija, Fellow.