by hilzoy
From the NYT:
“John Edwards ended 2004 with a problem: how to keep alive his public profile without the benefit of a presidential campaign that could finance his travels and pay for his political staff.
Mr. Edwards, who reported this year that he had assets of nearly $30 million, came up with a novel solution, creating a nonprofit organization with the stated mission of fighting poverty. The organization, the Center for Promise and Opportunity, raised $1.3 million in 2005, and — unlike a sister charity he created to raise scholarship money for poor students — the main beneficiary of the center’s fund-raising was Mr. Edwards himself, tax filings show.
A spokesman for Mr. Edwards defended the center yesterday as a legitimate tool against poverty.
The organization became a big part of a shadow political apparatus for Mr. Edwards after his defeat as the Democratic vice presidential nominee in 2004 and before the start of his presidential bid this time around. Its officers were members of his political staff, and it helped pay for his nearly constant travel, including to early primary states.
While Mr. Edwards said the organization’s purpose was “making the eradication of poverty the cause of this generation,” its federal filings say it financed “retreats and seminars” with foreign policy experts on Iraq and national security issues. Unlike the scholarship charity, donations to it were not tax deductible, and, significantly, it did not have to disclose its donors — as political action committees and other political fund-raising vehicles do — and there were no limits on the size of individual donations. (…)
Its directors included [“J. Edwin Turlington, a Raleigh lawyer who was the manager of Mr. Edward’s 2003 presidential exploratory committee” — earlier description from NYT article]; Miles Lackey, Mr. Edwards’s former chief of staff; Alexis Bar, his former political scheduler; and David Ginsberg, Mr. Edwards’s current deputy campaign manager.
The $1.3 million the group raised and spent in 2005 paid for travel, including Mr. Edwards’s “Opportunity Rocks” tour of 10 college campuses, consultants and a Web operation. In addition, some $540,000 went for the “exploration of new ideas,” according to tax filings.
Nonprofit groups can engage in political activities and not endanger their tax-exempt status so long as those activities are not its primary purpose. But the line between a bona fide charity and a political campaign is often fuzzy, said Marcus S. Owens, a Washington lawyer who headed the Internal Revenue Service division that oversees nonprofit agencies.
“I can’t say that what Mr. Edwards did was wrong,” Mr. Owens said. “But he was working right up to the line. Who knows whether he stepped or stumbled over it. But he was close enough that if a wind was blowing hard, he’d fall over it.””
Discussion below the fold.
The basic facts seem to be these: the Center for Promise and Opportunity (not to be confused with the Center for Promise and Opportunity Foundation, another Edwards nonprofit that seems to have done great work getting scholarships for poor kids in North Carolina) is a 501(c)(4) foundation. While donations to it are not tax-deductible, the organization itself does not have to pay taxes on the money it raises. According to the IRS:
“To be tax-exempt as a social welfare organization described in Internal Revenue Code (IRC) section 501(c)(4), an organization must not be organized for profit and must be operated exclusively to promote social welfare. (…)
The promotion of social welfare does not include direct or indirect participation or intervention in political campaigns on behalf of or in opposition to any candidate for public office. However, a section 501(c)(4) social welfare organization may engage in some political activities, so long as that is not its primary activity.”
The NYT quotes a representative of the Edwards campaign as saying:
“One of the Center for Promise and Opportunity’s main goals was to raise awareness about poverty and engage people to fight it,” Jonathan Prince, deputy campaign manager, said yesterday. “Of course, it sent Senator Edwards around the country to do this. How else could we have engaged tens of thousands of college students or sent 700 young people to help rebuild New Orleans? It’s patently absurd to suggest there’s anything wrong with an organization designed to raise awareness about poverty actually working to raise awareness about poverty.”
“Of course, some of the people who worked for Senator Edwards in the government and on his campaign continued to work with him to fight poverty and send young people to college,” he added. “Perish the thought: people involved in politics actually trying to improve peoples’ lives.”
And surely sending John Edwards around the country to talk about poverty is a way of raising awareness of it, and it might well contribute to the common good. However, the legal question is not whether Edwards did good things with this organization, which I assume he did, but whether (a) the primary purpose of the organization was to contribute to the common good, as opposed to participating in a political campaign, as the law requires; and (b) whether some of the things the organization did involved inappropriate uses of its money. For instance, it is not obvious to me that financing retreats on Iraq with national security experts is a way of “making the eradication of poverty the cause of this generation.”
There’s a further question, namely: since Edwards has a fair amount of money, why not just support himself and his staff for a couple of years, or use his speaking fees? Alternately, why not set up a campaign committee and use donations to it? Why insist on tax-exempt status and the right not to disclose his donors?
***
I was reading around to see what other people had written about this, and found this article at RealClearPolitics:
“John Edwards has gotten a lot of bad press recently for his “two Americas” lifestyle – and rightfully so. There is something inherently contradictory about portraying yourself as a champion of the poor while getting $400 haircuts, living in a 28,000 square-foot mansion, and getting paid $55,000 a pop to speak about poverty.
That being said, today’s article by Leslie Wayne in the New York Times strikes me as unfair to Edwards.”
I take exactly the opposite view. I think that the story about Edwards’ speaking fees is ridiculous — if people want to pay him a lot of money, why not accept it? Likewise his house: lots of people have large, expensive houses and never lift a finger to help anyone else; the idea that this somehow becomes bad when you do try to help other people is, to me, just bizarre, as is the idea that you are only allowed to talk about poverty when you have sold all your worldly possessions and moved into a cardboard box. And the haircut — well, I said what I thought about that one at the time.
This one, I think, is different. I don’t see that there is a good reason for a man of considerable wealth to set up a non-profit, tax-exempt organization to support his travels and his political staff. I honestly don’t. I’d be interested in hearing what other people think about it — especially those of you who know more than I do (which means: anything at all) about tax law.
***
I’d also be interested in reading reactions from bloggers on the left. However, as far as I can tell, most of the left-wing bloggers have gone dark on this one.
To be clear: I don’t think that the failure of any particular person to write about something means much of anything. I didn’t write about the Obama campaign’s Punjab moment, which I thought was odious, because I was busy, and by the time I stopped being busy, he had come out with what I thought was a good apology, in which he accepted full responsibility personally. I didn’t write about Hillary Clinton’s vile capmpaign manager, whom I find quite troubling. I haven’t yet written about the Romney aide who wants to be a policeman when he grows up, or any number of similar things. Virtually nothing can be inferred from the fact that I don’t write about something, and I assume the same is true of most bloggers.
On the other hand, it is striking that when I search the 60 left blogs that are on my main bookmarks list, I found three (3) posts on this story. (Apologies to anyone I’ve missed; I skipped blogs that either restrict themselves to unrelated subjects, like, say, Registan, or are blogs of politicians or parties; on sites like dKos and MyDD, I did not search diaries.) One is from Big Tent Democrat, and concerns the fact that the story’s first two paragraphs are unfair. (I agree: it’s speculation, not fact, that Edwards came up with the idea of this organization as a “solution” to the “problem” of keeping his public profile alive without a campaign. I also think the larger story is worth commenting on.) One is a snippet in the morning roundup of campaign news at Election Central. And one — the only substantive comment from the left that I’ve seen so far — is by Susan Madrak at the Huffington Post. But Madrak’s piece is mainly about how bad the Times is, not about the substantive isues involved. Excerpt:
“The same paper that was oh, so reluctant to question the motives of the gang of crooks and liars that have been desecrating the White House and Congress for far too many years now is going after John Edwards for being smart enough to keep himself politically viable.”
I have no problem with Madrak’s piece. I agree about the Times — I think it’s often lazy and at times downright pernicious (cough, Judy Miller, cough), though it also does some really good international journalism, and employs Jason DeParle, which makes up for a multitude of sins. What I am worried about is the fact that, as I said, no one else is writing about this at all. No one.
Why is that?
***
Update: missed one (The Daily Howler.) Also, Greg Sargent posted another story at Election Central while I was posting this, and Josh Marshall linked to it. It says: “The Edwards campaign has just told us on the record that The Times refused the chance to talk to any real, live beneficiaries of Edwards’ programs.”
I assume that by ‘beneficiaries of Edwards’ programs’, the campaign means beneficiaries of the Center for Promise and Opportunity, as opposed to beneficiaries of any of Edwards’ other programs. (If they offered to let the Times talk to beneficiaries of his other programs, then I can see why the Times would think that was irrelevant.) I haven’t read the documents the Times has, which include its federal filings, but if those documents say (and I am just making this up) that the Center spent, say, 95% of its money on Edwards’ travel, retreats on national security policy, and other such things, and only 5% on direct assistance to the poor, then, again, I could see not wanting to interview the people who had recieved that 5%, if I did not plan to assert that they just didn’t exist or had not been helped.
Again: the question about this is not whether Edwards cares about policy, or whether he has done good works. He does; he has. It’s about whether he also made inappropriate use of a non-profit, tax-exempt organization.
And my further question is: why hasn’t anyone on the left blogged this?
***
Now, around two and a half hours after I wrote this, people are blogging it.
As a minor leftwing blogger, I saw the story, and have been lying low looking for reactions to it, because I don’t know much about non-profit law and practices. I agree with you that it looks hinky. On the other hand, if it appears that such non-profits are ordinary and customarily used in circumstances like this (that is, in support of an extended campaign), I don’t want to condemn Edwards for something that goes unnoticed when other people do it.
This isn’t an area where I have any intuitive sense of the ethics. Given that what he did was within the law, I need someone with a broader perspective on what conventional practice is before I pass judgment one way or the other.
Bleah. As a closet Edwards supporter (he’s barely on non-politically-active-peoples’ radars, so it’s tough in casual conversation), this is pretty damn disappointing.
As for not blogging about it, I’d bet that that’s equal parts having not gotten around to it (it was just posted and, I assume, published, today) and not wanting to get around to it. I can see a liberal blogger seeing it, thinking “That’s bad, I should write about it” and then putting it off because it’s unpleasant and then getting on to the next thing to blog about and never writing about it — not an intentional “I don’t want to report bad news about a progressive,” but the reluctance to do so definitely playing a role.
Well, as the resident tax lawyer, I’d offer up my opinion on this but I have done little to no work on charitable organizations, so I don’t have an idea whether this is kosher or not (or close to being non-kosher or close to being kosher). If I see anything in the tax press on this I’ll try to excerpt it here (and it’s interesting that the NYTimes resident tax reporter, David Cay Johnston, didn’t report on this).
That being said, Edwards’ real tax problem is the S-corp he used to avoid paying Medicare taxes on his earnings from his trial lawyer work prior to being a Senator.
I’m not a lefty blogger, just a lurker, but I’ll take issue with your question. I, personally, don’t find it at all troubling that major liberal sites have let this one go dark. Basically, there are plenty of people who are more than willing to attack Edwards–right blogistan, talk radio, etc. Why on earth should liberals join them? If Edwards did something hinky, then he will get called for it–without help from the left. The same can’t be said for, e.g., Alberto Gonzales–if it weren’t for the left driving that story, it would never have gotten out.
Basically, it’s a question of comparative advantage. The left has a comparative advantage in tearing down figures on the right; and vice versa. Why spend time on something that’ll get done anyway? Tearing down Edwards does not help the cause of liberalism, and as such major liberal writers are giving it a pass. This is about as surprising as the fact that George Will rarely writes about the plight of workers who are struggling to unionize.
Dan: I don’t assume that anyone who wrote about it would be attacking Edwards. On the contrary: Edwards has lots of defenders among left bloggers, and the main reason I checked was that I wanted to see what they had to say before posting.
LB: I completely understand that, and, as I said, I draw no inferences from anyone in particular not blogging something. But: no dKos, no AmericaBlog, no MyDD, no Atrios, no Digby, no Matt Y, no Ezra, no anyone?
Actually, that was the reason I started checking. The reason I checked 60 blogs was sheer incredulity.
Hilzoy: fair enough, but in this context, don’t you think that silence is the best defense they could give him?
Another reason people have clammed up might be that they don’t want to appear to be taking sides in the primary; I know Garance Franke-Ruta at TAPPED has taken some heat over her alleged pro-Hillary bias and there are constant pleas to stop sniping in the diaries at MyDD.
How about the obvious answer: because it’s a boring wonky topic about a second-tier un-charismatic supporting cast member who isn’t going to be the Candidate (it’s gonna be a Candadette running to be the Presidette), so why waste intellectual fuel writing about it?
There’s a further question, namely: since Edwards has a fair amount of money, why not just support himself and his staff for a couple of years, or use his speaking fees?
I hate to generalize, but after having worked with and for attorneys, I can assure that it is not unusual for attorneys to expense everything that they legally can than to spend their own money on anything.
I don’t think my experience is that different.
Also the tax issues–how many bloggers just avoided the topic because it involves discoursing knowledgably about non-profits and taxes, one of the most boring topics under the sun?
Still, I’m surprised that Edwards came up with this and didn’t realize there might be a problem. Reminds me of the line:” oooh, you’re so smart you’ll cut yourself.”
I am an Edwards fan. I thought the haircut rap was ridiculous. I think his lifestyle, like Gore’s, is irrelevant to the agenda they propose and with which I agree.
I think Edwards wanted to achieve a dual purpose. Keep his name in front of the public AND do something good. I like the things Edwards says and believe he is committed to making them happen in the WH.
This looks like it could be a closer question as to whether he violated tax laws or campaign laws or whatever.
If he did something improper, I expect him to cop to it.
But compare this to K Street. Edwards, undoubtedly, has smart people working for him and maybe they got too cute with this. I don’t know.
Does Edwards bring this on himself or does the press like to trip him up. I don’t recall seeing any other profiles in candidate hygiene.
I’m suspicious mostly because there seems to have been a throw spaghetti at the wall and see what sticks tone to the Edwards coverage.
Garth: I’m with you on the comparison to K Street. But (and I don’t mean that you meant what I’m about to deny, I just want to say it myself) I don’t think we shouldn’t talk about stuff our candidates do so long as it’s not as bad as K street.
I dislike the idea that liberals are supposed to keep mum about liberal candidates’ errors and misdeeds, out of partisan tactics.
You can’t preach from the moral high ground unless you stand on the moral high ground.
What’s disappointing about this is that one has to look to “liberal blogs” or whatever … instead of looking at what Edwards himself has to say about it. It’s like the White House — cooking up a non-answer, instead of being candid.
Given the small fiasco over Marcotte & Shakes, who knows how they’ll deal with this one.
TPM has more.
and I agree with Anderson.
after 8 years of Bush, I am ready for someone to take the high ground. I don’t intend to give my team a pass because I want the best team possible.
Edwards better be smart enough to figure out how to run a goddamn campaign because he can expect no slack.
Ethically, I am not sure that this is something that is that unethical, if it is indeed unethical at all.
In terms of the ethics of this campaign, I think that not disclosing a donor list is objectionable on the grounds that there is too much money in politics. I think that Edwards should simply respond and let the media know who donated the money – if it is mostly his, then who cares? If it’s somebody else’s, it’s probably not going to be any of the really big players because they are supporting either Clinton or Obama.
And, I don’t see the work that he was doing as antithetical to reducing poverty in the U.S. We all know that the war is draining our non-existent tax base that is going to require billions, probably trillions, more to come to some possible conclusion (that is, even if we left Iraq right now), and is going to be a major concern for any domestic policy program as well as an international one. It is hard to combat poverty without money.
Lastly, I don’t think that what he did is really that bad, in-and-of-itself. Should the people of the state of New York be upset that Clinton didn’t spend most of her money in her Senatorial race and is, instead, spending it traveling the country to run for President, instead? Political contributions are different than contributions to a non-profit but need there be such a divide between Politics big “P” and politics small “p”?
Finally, I was fortunate enough to be at the University of Michigan when Edwards spoke there. I was impressed; it was a stump speech, but he also met with students and helped garner support for increasing the minimum wage there and invested in a lot of on-the-ground organizing that wins elections. And, whether he wins the nomination or not as a result, there is an infrastructure there to begin to address the underlying problems of inequality and political apathy.
This comment is getting long enough that I probably should have posted it on my own blog, but I think that it is an interesting question.
i am perfectly prepared to conclude as Mike3550 suggests that this is another attempt to drum something up that contains a certain truthiness.
in fact, it would serve to further cement my approval of Edwards campaign strategy and make me even more skeptical in the future of allegations of wrong doing.
the internet is becoming part of the political vetting process.
Ugh: yeah; see my update.
It bugs me that all the commentary so far, except for Brian Beutler, who just posted one, is about the badness of the Times’ election coverage, which I will just stipulate agreement with, or bias, or how apparently this would all be OK for a Republican, and not about the actual facts.
I mean: I normally think of responses to a story that are all about the utterly discredited nature of the source, their malign motives, the obvious bias shown by the fact that the story didn’t mention some other event that the responder thinks should have been mentioned, the fact that the other side does much worse stuff and no one ever talks aboutthat, now do they?, and so on, as Bizarro World responses. Not ours. I would like to be right about this.
LB: I completely understand that, and, as I said, I draw no inferences from anyone in particular not blogging something. But: no dKos, no AmericaBlog, no MyDD, no Atrios, no Digby, no Matt Y, no Ezra, no anyone?
The thing is, I can’t think of a liberal blogger who I’d expect to have the kind of knowledge I want on this — you really would need an in-the-weeds-nonprofits/political-type expert. It makes perfect sense to me that everyone is hanging back neither wanting to defend something that turns out bad, nor wanting to jump on the bandwagon and hurt Edwards if it turned out to be unexceptionable (particularly because the tone of the article was condemnatory, and I’m really suspicious of articles condemning Democrats on the basis of wrongdoing I can’t quite understand.)
I’m not sure I understand what the issue is. Is it that the foundation behaved illegally? As far as I can tell the NYT piece didn’t allege that. The furthest it went was “I can’t say that what Mr. Edwards did was wrong, … but he was working right up to the line.” Which when unspun says it wasn’t wrong. That is, that the foundation met the IRS requirement that it “must be operated exclusively to promote social welfare.” I would imagine that the Bush-era IRS would be investigating the foundation if it were illegal; it’s investigated several non-right wing non-profits.
So if the issue isn’t the foundation’s legality, if the issue isn’t whether the foundation was operated exclusively to promote social welfare, what is it?
It’s hard to defend against an undefined allegation.
Which means that some blogger who does actual reporting should be phoning an in-the-weeds-political-nonprofits guy for answers. So, someone at TAPPED? Or Yglesias?
The Edwards pushback at TPM linked above is pretty lame thus far — the bad old Times rejected the opportunity to speak to people “directly impacted by Edwards’ programs.” (Bad English is TPM’s, not the campaign’s.)
If, e.g., they misspent 90% of the money, it wouldn’t make any difference that they could trot out beneficiaries of the other 10%.
Hilzoy,
Perhaps all the coverage so far has centered around the bad reporting because the article starts out with strong allegations, but then fails to really bach them up.
Meanwhile, I am sure people are digging in and I expect a stronger Edwards response soon.
I take it this was published today, front page NYT. I don’t think anyone knows what to make of it.
I think 501 filings are made public, but not sure where to find them.
The problem with this is, I think, regardless of whether it was legal or not, that Edwards is using mechanisms that are not available to those with lesser means (as his use of the S-corp I reference above demonstrates). I think this qualitatively differs from things like “he has more money so he can buy a bigger house” sort of stuff, which people intuitively understand. Instead, it smacks of the well-off gaming the system or bending/changing the rules to further their advantage.
Plus the seeming hypocrisy, which doesn’t attach to people like Cheney who invest massively in tax-free bonds in order to not pay federal income taxes.
I don’t think we should be giving people a pass either, but I’m a little puzzled by this. As far as taxes go, I’m not sure a straightforward political committee of some kind would be treated any differently than this organization. Contributions are not tax-deductible, but the organization pays no taxes because it is set up as a nonprofit. Isn’t that what happens with “XXX for President,” and the DNC, RNC, etc.?
I can see a couple of possibilities here. One is that this approach avoids some reporting requirements faced by political organizations. Another is that this was done simply because the paperwork was already in place, so it just a matter of convenience, and no harm done since there are no tax issues. IOW it operates under the wrong section of the IRS code, but that’s purely technical.
I’m curious to hear more from the Edwards campaign.
My understanding is that certain political “soft-money” contributions are capped under campaign finance laws, but other 501(c)(3) and 501(c)(4) organizations are not (hence the rise in importance of organizations such as MoveOn, PFAW, etc.).
But, I could be entirely wrong.
Ugh,
Edwards’ real tax problem is the S-corp he used to avoid paying Medicare taxes on his earnings from his trial lawyer work prior to being a Senator.
Isn’t this fairly routine for people who earn a lot their income as fees? Does Giuliani pay Medicare taxes on his speaking fees, for example?
Ugh: in addition, I think there’s another problem.
Let’s suppose, for the sake of argument, that Edwards did set this up in order to make his campaign tax-exempt and his donors secret, and let’s further suppose that no one can make a clear legal case against it, since that would require showing stuff about its “purpose” and “primary activity” and other nebulous, hard-to-define stuff of that nature. It’s still pretty clear that this is not what non-profits are supposed to be, and that setting things up this way is a way of pushing the envelope on a somewhat vague statute.
There are cases where I don’t mind that so much, mainly cases where it doesn’t matter. But in this case, you have a law that: (a) is set up for a genuinely good purpose: making charities tax-exempt; (b) has a hard-to-avoid vagueness (about primary purpose, etc.) (I mean, the Sierra Club should be able to support legislation, but my campaign for dogkeeper should not be in the same category as the Sierra Club); (c) will only be able to function so long as people don’t insist on pushing that vagueness to the limit.
In a case like that, pushing the envelope is just wrong, I think. It’s twisting the law in a way that might, I suppose, be OK as part of a legal argument to be assessed by a judge rather than acted on straightaway, since you have a responsibility to your client, but is not OK when you’re acting on your own, since you are honestly not respecting the law, and you are pressing very hard on a distinction that might not survive the pressure, but is very much worth preserving.
Bernard: disclosure requirements, donation caps…
Bernard – Edwards would have owed Medicare taxes on his lawyer’s fees as a self-employed individual (or member of a service partnership) had he not set up an S-corp to be the one who ostensibly provided the services and then received the bulk of his income as dividends from the S-Corp. Rudy likewise would be subject to Medicare taxes for his speaking fees unless he set up a similar structure.
There was some debate in the tax press as to the extent to which Edwards used the S-corp to avoid medicare taxes was legitimate (focused on the ratio of S-corp dividends to his salary as an employee of the S-corp), although IIRC there was general agreement that this could be used, but not abused.
Either way, I think he’s subject to attack on the point and the attack wouldn’t be without substance (plus the hypocrisy point).
To help, I pulled out my copy of Politics the Wellstone Way put together by Wellstone Action and printed by the University of Minnesota press because I think that it is a great political handbook.
This is what they say about nonprofits:
They go on to list the things that (c)(3)s and (c)(4)s can and cannot do:
Given that he is the candidate, it seems to me to be a little more problematic. But, in terms of his work discussing Iraq, traveling abroad and his activities to support unions and increasing the minimum wage seem perfectly legit.
(Again, sorry for the long post).
From reading the energetic Obama-Edwards back-and-forth at DK, I’m sure there will be plenty of coverage from the former’s supporters and discussion from the latter’s when there has been more of a reply from his campaign. Beyond that what LB writes above seems sensible to me.
“Thou shalt not bear false witness.”
The slander of peoples good charactor is a science practiced as art by modern right wingers.
There greatest achievement is to get others to do their dirty work for them.
Hilzoy, before you become part of the problem you should check the sources and motives of those who give you slanderous material to pass along.
The fact that Edwards did nothing illegal or unethical is not even relevant any more. Some unspecified charge that he did something or other wrong is laid out there and is unanwerable because there is no charge to answer to. The damage is done. Mission accomplished.
What if there were people who wanted to donate to the Edwards campaign, but didn’t want to make themselves targets for speculation and the public eye? Assuming that there are people who are rich and don’t like attention, what steps should Edwards take to make sure that their privacy is protected?
This may sound like making up any old thing to protect Edwards, but I’ve not made up my mind about Edwards. On the one hand, the process of funding should be transparent. On the other hand, looking at the kind of accusations that a person like George Soros has gotten, I could see a strong argument for just sitting on my money and donating it to help the Symphony or the art museum instead of participating in the political process.
I think this is where I get off the Nice Liberal train. We have a political system funded in a million different ways by a gigantic sewer of legalized bribery. Every major politician in the US is implicated in this. Edwards would be completely implicated in it whether or not he’d ever done the things this article covers.
So it seems to me paying any attention to this is not just missing the forest for the trees, it’s missing the forest for the tiny patch of four-leaf clover.
ken: I have said what I think is wrong with it. And I do not particularly want to get into the business of asking myself whether, by writing things I believe to be true, I might also be advancing someone else’s agenda. — Or rather: I might start wondering about this if I started spending all my time slamming Democrats. But it’s not clear why saying this about one (1) story that seems to have merit is different from saying that when I wrote about Abu Ghraib, I am advancing the cause of the enemies of our country.
In that case, I assume that I am probably advancing the casue of friends of our country, by doing whatever trivial bit I can to help make it better, and probably also giving some infinitesimal assistance to anyone whose aim it is to publicize our country’s failings. I don’t find it helpful to worry about the latter.
I think most lefty bloggers would be willing to say something if it was clear he had done something bad.
On the other hand, when it’s not clear, we’ve all seen too many smear jobs and solid-sounding allegations that didn’t play out to jump on the bandwagon. People are curious to know the real deal, but they’re waiting to find out, as opposed to making posts that say “this MIGHT be real bad, let’s wring our hands over it just in case.”
If it’s true, of course it’s serious. But the problem is, there’s so much truthiness out there that you can spend all day trying to confirm Drudge’s latest. No one wants to get suckered into that game; they’d rather wait and see.
However, as far as I can tell, most of the left-wing bloggers have gone dark on this one.
An odd turn of phrase for a story that appeared online fewer than 24 hours ago. However, I assume you mean there’s nothing on sites that focus heavily on elections, like MyDD, Daily Kos, and Election Central at TPMCafe? They’re the only places I’d realistically expect a reaction by this point. That’s who you mean by ‘left-wing’, yes?
Here’s the two cents from this left-wing voter inclined to support Edwards if forced to choose among the three front-runners: I’m in agreement with your basic take on the story.
I have to go make snow cones at the drive-in. Maybe by tomorrow there’ll be more commentary, or you’ll have found it.
I was poking around blogs thinking of writing something very much like you have here, hilzoy. I was struck by the almost total silence on the left. The excuse offered by Greg Sargent at TPM is ridiculous (in fact, it sounds like Edwards was offering to put the Times in touch with students who’d received scholarships–thus trying to change the subject, or confuse the issue).
I don’t know what standard practices are among otherwise unemployed presidential candidates in waiting, but the facts in this case don’t look good. The campaign staffers may all have a deep background in poverty issues, and that would be worth looking into. On the face of it, I doubt that’s the case.
As for all the foreign policy stuff, that’s clearly the presidential campaign. Totally out of line for a tax-exempt entity like this to be paying for that.
It really looks like the NYT hit the nail on the head. And it does fit a pattern.
Edwards does seem very ready to misuse funds. Spending $400 of money people donated to his political campaign, to pay for a damned haircut, and thus leaving a paper trail for investigators to pick up, is worse than stupid. It’s arrogant in a Gary Hart kind of way.
Anyway, why would people give his campaign money if he squanders it on personal fluff? That may be behind the info coming out today that there’s a big downturn in campaign contributions for Edwards.
Anyway, the more I see of Edwards, the more queasy I become. I don’t care if he’s an inspirational speaker about poverty. Why is he raising money ostensibly to fight poverty, and using it instead to run a presidential campaign? If this passes the smell test, then he ought to explain why, forthrightly.
Edwards does seem very ready to misuse funds. Spending $400 of money people donated to his political campaign, to pay for a damned haircut, and thus leaving a paper trail for investigators to pick up, is worse than stupid. It’s arrogant in a Gary Hart kind of way.
Yeah, see, that sort of thing is what makes me hesitate to pass judgment based on this until I see an expert response.
Blogs have no trouble raising questions, or jumping to conclusions, 24 minutes after something damaging to Bush comes along.
It’s premature to say “Edwards is evil!!!” (unless you already thought that), but it’s entirely appropriate for liberal blogs to say “hey, here’s this story, what gives?”
The Repubs wouldn’t do that, but then, we’re not Karl Rove, are we?
smintheus: to expand on what LB said: when I first read the haircut story, I thought: look, if there’s one thing I know about political campaigns, it’s that the candidates have absolutely no time to spare. Any second they’re not at events, shaking hands, etc., they are calling donors, strategizing, whatever, and if they get any time to just collapse somewhere, it’s a miracle.
Now: I myself have, on occasion, felt rushed, though not nearly to that extent. And one of the things I do when I feel rushed and have no time is: not check prices. I am hungry: here is a restaurant: I will eat. — I normally make some cursory attempt at frugality, like avoiding places with excessively fancy linen, or for that matter any linen, but that’s it. (And if I were John Edwards, I wouldn’t be looking to find a cheapo hairdresser in any case.)
For that reason, it has, on occasion, happened to me that I have spent a lot more money than I planned to for lunch, while running somewhere. That being the case, I could immediately see how this could happen to a political candidate. (Or, more likely, to his staff person.) It made such perfect sense. So I have no problem at all with that one.
Anderson, I agree with your points here.
I see that there is now a post at Daily Kos by Miss Laura, who does little more than restate Sargent’s lame smokescreen. Shame, an opportunity missed to say something like “What gives?”. Usually she’s better than that.
Armando has a post at Talk Left in which he admits that this looks bad for Edwards, but instead of commenting on the substance, he castigates Wayne for the opening few sentences.
It’s premature to say “Edwards is evil!!!” (unless you already thought that), but it’s entirely appropriate for liberal blogs to say “hey, here’s this story, what gives?”
Unless you’re actually doing an investigation yourself, as sites like TPM do, it contributes nothing to call attention to the story and say “I have no idea if there’s something bad here, but if there is something bad, then it’s bad!”
Only liberals suffer from the delusion that there’s a magical scorekeeper in the sky who keeps track of whether you publicize unproven attacks on Democrats just as much as you publicize unproven attacks on Republicans, and that if you do, the magical scorekeeper will vest you with a mantle of credibility and the whole world will stop to acknowledge how eminently fair you are.
If there turns out to be something genuinely worthy of commentary in this, then yes, I expect everyone to speak up on it. But until that time, I’m really not bothered by people who assume that this could be just Unsupported Smear Job #372947. They’ve learned from the previous 372946 times that in the course of trying to impress the magical scorekeeper in the sky, you end up repeating an awful lot of bullshit.
“Blogs have no trouble raising questions, or jumping to conclusions, 24 minutes after something damaging to Bush comes along.”
Re Bush, one doesn’t jump – one takes a tiny step, and there conclusions are.
‘It’s premature to say “Edwards is evil!!!” (unless you already thought that), but it’s entirely appropriate for liberal blogs to say “hey, here’s this story, what gives?”‘
If I had a “huh, maybe nothing, maybe something” post up at my blog, I would still feel dumb now.
hilzoy, I think you would have to work pretty hard to stumble across a barber who charges $400 for a haircut. Had to have been a high-priced stylist, probably selected in consultation with Edwards.
Anyway, the main rap is that he paid for it with campaign funds. Is everything campaign related? Does he put his pet food and toilet paper on the campaign charge card too?
This is exactly equivalent to the kind of stuff that Rick Santorum got caught doing, buying meals at the mall for himself and family, etc. from political funds.
Front-page at DK now.
smintheus: it gets a lot more comprehensible when you realize (I’ll find the story if you want) that the haircutter was paid to come to Edwards, rather than Edwards driving across LA. Which, again, strikes me as a quite sensible valuation of a candidate’s time. The only problem is “how it looks”, but it doesn’t look that way to me.
But (sorry, forgot this) you’re right about the campaign funds issue This, however, I put down to: staff screw up sometimes. (Since I very much doubt that Edwards was responsible for making that call himself.)
“think you would have to work pretty hard to stumble across a barber who charges $400 for a haircut.”
In Beverly Hills? Who makes house calls?
If you can document the maximum amounts spent by leading Republican candidates this cycle on haircuts, and the numbers are significantly different, you can make this argument, but as it stands it is woefully trivial.
I haven’t read the documents the Times has, which include its federal filings, but if those documents say (and I am just making this up) that the Center spent, say, 95% of its money on Edwards’ travel, retreats on national security policy, and other such things, and only 5% on direct assistance to the poor, then, again, I could see not wanting to interview the people who had recieved that 5%, if I did not plan to assert that they just didn’t exist or had not been helped.
Hil-
Isn’t the organization supposed to be a think-tank type thing, not a direct charity? At which point travel, retreats related to poverty, meeting with foreign leaders on poverty related stuff, all looks to be within its proper purview, doesn’t it? I’m really not sure how you would identify wrongdoing in this regard, short of literal commingling of non-profit with campaign cash.
I recall when Edwards was doing this and people were speculating whether this was intended to keep him set up for a Presidential bid. The fact that it was speculation at the time is pretty respectable evidence that this isn’t over the line or even right on it. As mentioned above, political advocacy is well within the bounds of a 501(c)4 and paying an antipoverty crusader to stump around the country for minimum wage laws, inspirational speeches and meeting with various business and political leaders is a spot-on use of 501(c)4 funds. Edwards could quite obviously have spent the rest of his life doing that kind of stuff – it’s basically what Gore does now – so it’s by no means necessarily a setup for a political run. Now half a million on “developing new ideas” could be problematic – or might not be. Normally that’s called a “think tank” and certainly Cato or Heritage or Rand aren’t considered abusive. It depends on who got the money and what kind of new ideas were generated – details missing from the NYT piece.
LB: yeah, but I was responding to Greg Sargent’s piece, which was about the Times’ failure to meet with what the Edwards campaign describes as “beneficiaries of Edwards’ programs”. Personally, I have a hunch (hunch! supported by nothing!) that these will turn out to be scholarship recipients from E’s other foundation, the one the story was not about, or something.
However, suppose this foundation does have “beneficiaries”: I think it’s only a problem not to meet with them if you planned to say that they didn’t exist, or werent benefitted, or something. But if your story turned on the nature of all the other stuff E’s foundation had done, meeting them would be irrelevant. (Refusing to meet with them might be like refusing to meet with students testifying to their wonderful educations in a story about an administrator using funds for personal stuff.)
Well, to back up my earlier inference, here’s a BusinessWeek piece from late May:
http://www.businessweek.com/magazine/content/07_22/c4036012.htm
Edwards put BW in touch with a recipient of a scholarship, which seems to deliberately confuse the two non-profits, the scholarship foundation and the center that put him and his political staff on salary.
I don’t know of any challenge to the legitimacy of the scholarships/foundation. So for Edwards to try to fob BW off with a scholarship recipient’s tale is pretty damned cheesy.
Huh. That’d be really irresponsible of Sargent or the Edwards campaign if true, (that they were talking about the beneficiaries of the wrong program) which means I can’t share your hunch. But I do take your point that showing that some money went to the right place doesn’t show that lots didn’t go to the wrong place.
There’s also now an AP report on this story, which seems to be heavily fact based. I’m going to have to read it carefully.
http://www.forbes.com/feeds/ap/2007/06/22/ap3847718.html
Lizardbreath, did you see the link I just posted? It seems to prove that the hunch hilzoy and I shared was spot on.
Not really, no. It addresses a different contact with reporters, and describes the scholarships in that story as coming from a foundation that’s part of the Center for Promise and Opportunity. So, either BusinessWeek or the NYT is confused about the relationship between the scholarships and the CPO, or there are two distinct sources of scholarships. None of this establishes wrongdoing.
smintheus, thanks for the link. A cursory reading leads me to think that since Edwards had a variety of funding sources for his various activities, some of them clearly for campaign purposes, it would be quite difficult to make a clear case that the one in question was used in an over-the-line way. If it turns out that his campaign did something wrong in such an obvious way, I’ll be very surprised and disappointed – for now I’m very skeptical.
I think it’s clear from the BW story that part of Edwards’ strategy for defusing the allegations against his Center were to link it to the scholarship program. Here are the final two paragraphs of that BW piece:
“Edwards, a former Democratic senator from North Carolina, launched the center in 2005 at the Washington (D.C.) address of his PAC. The nonprofit raised $1.3 million in 2005, the only year for which data are available, and spent some of it on a national speaking tour for Edwards. It also spent $259,000 on consultants. The campaign declines to disclose the donors or consultants. The center is now defunct, and some of its key leaders are now aiding the Edwards campaign. The Edwards campaign says the Center is not connected to a separate Edwards anti-poverty effort at the University of North Carolina.
Edwards’ team defends the center. “Obviously, some of the people who had worked for Senator Edwards in government and on his campaign continued to work with him in this effort,” says spokesman Eric Schultz. “John Edwards and everyone involved is proud of the organization’s work.” That work included running a foundation that awarded $300,000 in college aid to 86 North Carolina students in 2006. The Edwards campaign put BusinessWeek in touch with recipient Tony Tyson, 18, who finished his freshman year at North Carolina Agricultural & Technical State University. Tyson calls the scholarship “a golden opportunity.” When he returns to campus this fall, he adds, he’ll volunteer for Edwards’ campaign.”
It sounds like Edwards was trying to get the NYT reporter to talk to scholarship recipients as well. Totally misleading, if that’s what he was up to.
Sorry, if the organization runs the foundation — that is, if scholarship money comes out of the CPO, what’s misleading? If it doesn’t, the BW story is inaccurate.
Here is another data point to consider.
What is misleading is that the two organizations have the same name, Center for Promise and Opportunity. But the scholarship group adds “Foundation”.
Obviously the second paragraph I quoted from BW is less than clear that the scholarships have nothing to do with the “center” and the “organization” that the article is discussing. Yet BW says of the organization, “that work included…(scholarships)”.
It could be that BW managed to confuse itself without any help from Edwards. But it’s clear that Edwards’ campaign was approached about the doings of the defunct center in DC, defended the center, and put the reporter in touch with a scholarship recipient.
I don’t see how that can be anything other than disingenuous.
Given that the BW reporter didn’t successfully distinguish them when writing the story, we have no way of knowing whether the reporter distinguished them when researching the story — we don’t know what question the scholarship student was provided in response to (that is, we don’t know that the reporter made it clear to the Edwards people that the story was only about the CPO, not the CPOF). Once the published story is garbled in a manner that indicates the reporter doesn’t understand the subject matter, I’m not blaming the subject of the story for misleading them unless I’ve got the reporter standing up and claiming they were actively misled.
Steve, the challenge is NOT in regards to what Edwards did talking about poverty at fora such as the one you refer to.
The question is whether the Center in DC focused heavily or primarily on Edwards’ unannounced candidacy. It spent a ton of money on consultants, so far unexplained. A ton of money on salaries to Edwards’ political team. And perhaps a lot of money to pay for trips to battle-ground states.
Giving a few speeches at colleges does not cost 1.3 Million dollars.
LB, the question is: Why put the reporter in touch with such a student in the first place? The work of the NC foundation was not in question.
“And perhaps a lot of money to pay for trips to battle-ground states.”
Texas? California?
“It spent a ton of money on consultants, so far unexplained.”
But not as such nefarious.
Because given that the reporter was demonstrably unaware of the difference between the CPO and the CPOF, we’ve got no way of knowing what the reporter asked that caused them to be put in touch with the student. If, for example, they asked “Can you put me in touch with anyone that’s actually been helped by your foundation?” and the person to which the question was addressed understood ‘foundation’ as referring to the CPOF while the reporter had no idea there were two distinct organizations, putting them in touch with a scholarship student makes perfect sense.
From the NYT story:
So: the CPO Foundation gives out scholarships. The CPO (not Foundation) is the subject of the NYT story.
Now, Business Week:
I see three possibilities here.
(a) There are, in fact, two foundations associated with Edwards that not only give out scholarships in NC, but gave out $300,000 in scholarships in 2006. One is the CPO Foundation; the other is run by the CPO.
(b) There is only one such organization, the CPO Foundation. It is run by the CPO. This would be odd, since the BW article says: “The center is now defunct”, while the NYT has interviewed the executive director of one of the Foundation’s programs, who started her job in May. (If the Center included the Foundation, and the Center were dissolved, wouldn’t its parts be dissolved as well?) Likewise, the NYT describes them as “two similarly-named nonprofit agencies — the Center for Promise and Opportunity and the Center for Promise and Opportunity Foundation” which have filed separate tax returns.
(b) There is only one such organization, the Foundation. Tyson got his scholarship from it. The Edwards campaign put Business Week in touch with Tyson to rebut a story about a different organization entirely.
I’m open to hearing about a fourth possibility. But I await more facts.
Ah, LB notes a fourth possibility: the BW reporter asks something, we don’t know what, causing the Edwards campaign to produce Tyson. This could be, though Greg Sargent’s claim that “The Edwards campaign has just told us on the record that The Times refused the chance to talk to any real, live beneficiaries of Edwards’ programs” suggests that this might have come from the campaign, or else have been a response to a ‘would you comment on the story?’ question, of the sort that reporters are supposed to ask people.
What the hell!? Are we receiving comments directly from Rush Limbaugh now? Can we look forward to jokes about Obama’s love of watermelon next?
(a) Doesn’t work at all. (b) Doesn’t seem impossible to me, in that the CPOF could have at some point in the past been a part of the CPO, and been spun off to continue its work after the CPO became defunct. I don’t have any reason to think that is the case, but it’s a possibility. (c) This also looks like a possibility, but given the confusion of the BW writer, it’s not clear to me that they aren’t responsible for the confusion of the two entities throughout (that is, that the limited subject matter of the story was not made clear to the Edwards staffer who put BW in contact with Tyson — they were given the impression that the story was on, say, Edwards’ nonprofits generally.)
And I would note that the fact that BW was put in touch with a scholarship student doesn’t establish that the Edwards campaign was planning to put the NYT in touch with a scholarship student rather than a recipient of some other form of aid from the CPO.
Now, this sounds like special pleading — it is perfectly possible that the Edwards campaign knowingly put the BW reporter in touch with an irrelevant scholarship recipient, and was planning to do the same with the NYT. I’m just saying it’s not clear yet.
LB: true enough. I await further data.
Part of the reason I’m arguing so hard about this little point, is that it seems really unlikely that the CPO didn’t help anyone poor at all — while your argument that it doesn’t really matter to the meat of the story is solid, for the same reason you’d expect there to be some actual poor beneficiaries of the CPO — even if there was wrongdoing, you’d expect some cosmetic good works. (I believe ‘Opportunity Rocks’, which is I think part of the CPO, paid college kids to rebuild houses in New Orleans, for example.)
Under the assumption that there are poor people helped by the CPO to point to, then, the idea that the Edwards campaign deliberately deceived the BW reporter and tried to deceive the NYT reporter into thinking that CPOF scholarship recipients had gotten money from the CPO gets weird. It’s like one of those lies they claimed Gore told, where the lie wasn’t helpful and the truth was just as good, it was just motiveless mendacity, and those stories about Gore all turned out to be bullshit.
The Edwards campaign may be lying like a rug, but believing that it is at this point seems off.
Take a closer look at the 990: the purpose of the charity is something like “to find new ways of improving America.”
With boilerplate like that, a finding of ultra vires action is pretty hard.
Funnily enough, I just came back from the AICPA not-for-profit conference and attended a class on this very topic. The gist, which my own research confirms, is that the IRS has a sword of damoclese hanging over most NFPs. It’ll only bring it down if there’s sufficient political pressure (as there was in the recent crackdown on credit counseling agencies).
Long story short, the IRS probably could make a strong case for stripping the exemption, but it could similarly for many, many others that no one even blinks at (I have any number of clients that would get the whammo if held to the same standard and scrutiny as Edward’s charity. And that says a lot more about the selective enforcement by the IRS and lack of coherence and clarity in the law than it does these organizations).
Something I don’t understand – the Edwards campaign knew this was coming well in advance, why don’t they have a crushing rebuttal out? They’re really burning news cycles here.
jpe: “attended a class on this very topic”
Thanks for the expertise, randomly confirming my prejudice to boot.
Fwiw, I emailed the Times reporter, asking for info on what sorts of beneficiaries they were proposing.
Also, OT:
Guess who’s shipping out next week.
Interesting point, rf, but I wonder how much the campaign knows about how a story is going to be presented/framed/spun. I get the impression that campaign stories are not double checked, as opposed to other stories, but I may be completely wrong about this.
These 501s that have political agendas are commonly referred to as “stealth PACs,” and given that GOP s-PACs regularly outspend Dem ones by a sizable margin, I find the outrage! on the right a bit silly.
And notwithstanding the kinda problem I noted above (in which I misspelled Damocles, thank you very much), it’s all pretty standard stuff.
The one thing that does concern me – and here I take off the legal cap and put on the auditor cap – is that some of the numbers on the 990 (accessible at Guidestar.org) look pretty suspicious. Large, round number donations (suggesting a small number of donors), all of which was spent as it came in (I’ve never seen a net asset / revenue ratio that small).
Since it’s a 501(c)(4), it doesn’t have to file a schedule A and public support test, which could give clues as to whether there’s some funny business going on with those donations.
“I wonder how much the campaign knows about how a story is going to be presented/framed/spun”
The campaign should have assumed the worst when reporters’ sails appeared at the horizon of this story and prepared a broadside. And by now, with the article out for however long it’s been, there’s no question about the frame.
This is a stupid but important criterion for me in casting my primary vote. I want to see the Edwards campaign tear up the article in the next ten minutes.
A Disneyphile, eh? I wouldn’t have expected that of Andrew, but maybe I didn’t read his blog enough.
He had all the right structures in place (a c3, a c4, a 527, and a hard money PAC), so I highly, highly doubt there were any technical shenanigans going on with misuse of money and the political activity regs.
I have taken off my visor, loosened the tie around my short-sleeved collared shirt, and am now ready to rumble.
KC: What the hell!? Are we receiving comments directly from Rush Limbaugh now? Can we look forward to jokes about Obama’s love of watermelon next?
Couldn’t help but shed a solitary tear after reading JJ’s impassioned defence of unfairly maligned patriot and Good American Bernie Kerik.
stop putting faces to bloggers!!
Guess who’s shipping out next week.
best of luck, Andrew
jpe: thanks for the link to Guidestar. I couldn’t see whatever you saw, with the round numbers, but the 2005 990s were quite interesting. According to them, the CPO Foundation did not share cash or other assets, except for facilities, equipment, and $4,583.35 for the Exec. Director’s salary (allotted for time spent on CPO Foundation business.) Also, board members and officers. Its money, other than the $4,583.35, came from elsewhere.
The CPO Foundation return describes the relationship between the two as follows: “CPO explores ideas; CPOF conducts pilot projects to test those ideas.” What it did was establish a scholarship program in NC. It took in $70,000, and spent $26,197.02, though it’s not clear to me that in this year (2005) it actually gave out any scholarships.
The CPO itself seems to have given out no “grants and allocations”, nor “Specific assistance to individuals”. Its expenses are for things like salaries, consusltants, web services, etc. Near the very end of its filing, it says:
“CPO will begin by testing a new program to make the first year of college free to academically qualified students residing in its test area who make a commitment to participate in community service.”
That seems to be the program that the CPOF is setting up, though.
i a have been a long time Edwards fan, think the haircuts were a dud (the guy gets a hundred buck a cut and clears his schedule. could happen in Dallas, Memphis…)
on the other hand, it’s possible they may have been too cute for their own good. it seems like there was one charity doing good… and another charity that may have been doing good, or not, and keeping Edwards in the public eye.
the only reason I now hedge is that I want an explanation from Edwards. the man has a legion of fans that will rebut talking points all over the blathosphere, but he hasn’t put any out.
i gave him the benefit of the doubt on the Amanda Marcotte/blogger issue but he’s got to be able to counter this fast.
either there’s a reasonable explanation or not.
Edwards, a one-term former senator from North Carolina, set out to keep his political options open by promoting issues he cared about, like poverty.
“He wanted to learn, travel and be in a position to be a viable candidate,” said J. Edwin Turlington, a Raleigh lawyer and manager of Edwards’ 2003 presidential exploratory committee. “He had the ability to raise money to fund his activities. He had a vision, and he knew it would take money.”
Beyond the norm
But it was his use of a tax-exempt organization to finance his travel and employ people connected to his past and current campaigns that went beyond what most other prospective candidates have done before pursuing national office. And according to experts on nonprofit foundations, Edwards pushed at the boundaries of how far such organizations can venture into the political realm. Such entities, which are regulated under Section 501C-4 of the tax code, can engage in advocacy but cannot make partisan political activities their primary purpose without risking loss of their tax-exempt status.
Because the organization is not required to disclose its donors — and the campaign declined to do so — it is not clear whether those who gave money to it did so understanding that they were supporting Edwards’ political viability as much or more than they were giving money to combat poverty.
The money paid Edwards’ expenses while he walked picket lines and met with Wall Street executives. He gave speeches, hired consultants and attacked Bush. He led minimum-wage initiatives, went frequently to Iowa and appeared on TV. He traveled to China, India, Brussels, Uganda and Russia.
“He was not a U.S. senator; he had no office,” said Ferrel Guillory, a political program director at the Center for the Study of the American South at the University of North Carolina. “So he set up a series of entities to finance his travel, to finance a political shop and to finance an issue shop. It all adds up to a remarkable feat of keeping a presidential candidacy alive without any of the traditional bases for it.”
“One of the Center for Promise and Opportunity’s main goals was to raise awareness about poverty and engage people to fight it,” said Jonathan Prince, deputy campaign manager. “Of course, it sent Senator Edwards around the country to do this. How else could we have engaged tens of thousands of college students or sent 700 young people to help rebuild New Orleans? It’s patently absurd to suggest there’s anything wrong with an organization designed to raise awareness about poverty actually working to raise awareness about poverty.”
The Edwards campaign declined to disclose the amounts raised or spent by the two similarly named nonprofit agencies — the Center for Promise and Opportunity and the Center for Promise and Opportunity Foundation — since their 2005 tax filings, which are the most recent to have been filed.
The Center for Promise and Opportunity Foundation, which started with $70,000 in 2005, gave $300,000 in college scholarships in 2006, said Pamela Garland, the executive director of the College for Everyone Program that is part of the foundation. The center, often praised for helping poor students in Greene County, N.C., get into college, is on track to give $476,000 this year, Garland said.
Edwards broke his ties to that charity once he announced his candidacy for president.
At the same time, the larger nonprofit group had a more politically active agenda. The $1.3 million it raised and spent in 2005 paid for travel, including Edwards’ tour of 10 college campuses, consultants and a Web operation.
Nonprofit groups can engage in political activities and not endanger their tax-exempt status so long as those activities are not its primary purpose. But the line between a bona fide charity and a political campaign is often fuzzy, said Marcus S. Owens, a Washington lawyer who headed the Internal Revenue Service division that oversees nonprofit agencies.
“I can’t say that what Edwards did was wrong,” Owens said. “But he was working right up to the line.
Ugh,
Thanks for the explanation. I see the point. Looks bad for Edwards, since I doubt he provided much in the way of capital to the S corp, so realistically little of the income should have been considered dividends.
hilzoy,
I see your point also. I’d like to see what Edwards says before criticizing too harshly though.
Could this be defended as a tax exempt poverty advocacy group that hires John Edwards and acquaintances to study poverty, speak at campuses, hob-nob with policy makers…and keep Edwards in the public eye only as a side benefit to real advocacy for raising awareness of poverty.
I read some of the speeches Edwards made and they were rousing.
Simply because poverty is a meat and potatoes issue doesn’t make his advocacy or study of it partisan.
I think the question here is did he lie to the donors… if not, i see nothing inherently wrong with it and will wait another 24 for further developments.
is this that different than Gore producing An Inconvenient Truth…
and… i know, there were no charity shennanigans, but if the donors don’t care, i won’t say the man didn’t pursue a poverty agenda.
Garth: as best I can tell from the filing you can look t this on three levels:
(a) completely legalistic: the two organizations are separate, except for sharing facilities and the time of the CPOF’s exec. director. Benefits provided by the CPOF do not, I think, technically count as provided by the CPO.
(b) a bit higher-level: the CPO seems to have thought of the CPOF as sort of like a part of itself, at least when it says “CPO will begin by testing a new program to make the first year of college free to academically qualified students residing in its test area who make a commitment to participate in community service.” — about a program that would be run by the CPOF.
(c) big picture: most of the CPO’s activities were not about scholarship students at all. According to the CPO’s filing, their program expenses go like this:
$142,196.38: Opportunity Rocks
$80,417.62: retreats and seminars with foreign policy experts
$540,599.03: “Exploration of new ideas”.
Total: $763,213.03
(There’s roughly another $440,000 spent on management and fundraising.)
The CPOF, even if it were a part of this, would have been a very small part. (Its total expenses were under $50,000.)
In this big picture view, it’s harder to make the case for this as not being about paying for Edwards’ travel, continuing education, staff, etc., I think. Though, like you, I await an explanation.
this for me is the key graf (so far);
“One of the Center for Promise and Opportunity’s main goals was to raise awareness about poverty and engage people to fight it,” said Jonathan Prince, deputy campaign manager. “Of course, it sent Senator Edwards around the country to do this. How else could we have engaged tens of thousands of college students or sent 700 young people to help rebuild New Orleans? It’s patently absurd to suggest there’s anything wrong with an organization designed to raise awareness about poverty actually working to raise awareness about poverty.”
i agree there seems to be little co-ordinated action between the two.
is it wrong even if it is about paying Edwards expenses to advocate on poverty measures?
even if the intended side benefit is public exposure. it is that very public exposure that gives his advocacy whatever impact it has.
certainly, Edwards is not to be criticized for choosing to tour the nation raising awareness of this terrible problem.
but i see the calculation on his part. he’s clearly serving two masters here.
maybe this all boils down to the fact he made every one of his goddamn dollars himself and he’ll be damned if he doesn’t play it smart… too smart.
is opportunity rocks a CPO or CPOF effort?
Also, I think hilzoy is parsing this too closely. Hilzoy, the fact is that these foundations are related. I’m not really sure that, aside from bookkeeping issues, they are separate in any meaningful way. Lots of 501c3’s have c4s to do political work. A lot of political people bring their campaign staffs with them to do other work after they’re done campaigning.
jpe makes this point more indirectly, in that Edwards had all 4 types of organizations set up. There’s really no reason why he would do anything weird here…
It doesn’t prove anything, but then neither has the times (or, remarkably, you for that matter…). I’m not sure what public purpose is served raising allegations without doing the next step investigation. It used to be that our papers did that, but no longer…
on my first question, Hilzoy posted the numbers I didn’t find on first read. Sorry bout that. comments crossed on the wire… 🙂
“take exactly the opposite view. I think that the story about Edwards’ speaking fees is ridiculous — if people want to pay him a lot of money, why not accept it?”
He’s a Democrat. It’s only wrong if a Repblican does it.
“LB: true enough. I await further data.”
Exactly. Patience is always required if it’s a Democrat. One should only assume the worse if it’s the Bush Administration, the US military or a Republican.
“It’s only wrong if a Repblican does it.”
It’s not snark if you just sling baseless accusations.
I guess you didn’t check my blog for yesterday.
http://ThomasMc.com/0622.htm
The truth is, many of the bloggers who claim to speak for the left, are really right of center — just like most of the Democratic candidates. Gravel & Kucinich being the only ones who actually qualify as left. I’d put Hillary to the right of McCain.
btw: I’ve lost most of my readers because I do talk about the foibles and failings of the Democrats, and the partisans don’t want to hear it unless it’s about Republicans.
I appreciate this post, Hilzoy, which speaks well of you.
As Ugh notes above, this is likely not Edwards’ sole tax (or legal) problem. I have never been a fan of Edwards. But there are two many disconnects between Edwards’ political platform and Edwards’ personal activities. There are too many policies that Edwards advocates pursuing that conflict with what Edwards actually does.
(I agree with Hilzoy that the fact that Edwards publicly choses to devote himself to the cause of the poor does not conflict one bit with his considerable wealth. More power to any person who tries to do public good. But here the issue is whether Edwards is actually serving the interests of the poor when he serves his own interest, and which master — himself or the cause — is paramount in these endeavors.)
I appreciate this post, Hilzoy, which speaks well of you.
Hmm: fun with dependent clauses.
For clarity, I mean the post speaks well of you, not my appreciation thereof.
al gore did an Inconvenient Truth and made buttloads of dough.
rudy giuliani was booted of the ISG because the meeting conflicted with his lucrative, post-911 speaking engagements (11.4 million).
others become lobbyists, become Fellows at think tanks or otherwise engage in activities that do not preclude a lavish lifestyle.
let’s face it the rich get all the perks and they get them for free… an irony commented upon by many of the wealthy…
everyone concedes that Edwards was actually engaged in activities designed to raise awareness of poverty and educate the public and himself about this serious problem.
yes, he set up a non-profit and used it benefit himself and his former campaign workers, but it has yet to be alleged he defrauded his donors.
who put together the Scooter Libby defense fund (and I know this can be called apples and oranges)?
i’d be disappointed to know that what Edwards set up is not legal. if it’s legal, however, i don’t see what all the fuss is about.
i can only assume it is because Edwards has made poverty a key issue that he is accused so easily and quickly of hypocripsy.
same thing happened to Gore.
yes, it IS an inconvenient truth that Gore consumes A LOT of energy, but that fact is irrelevant to his and my committment for improving our energy policy.
the only reason to dislike Edwards, from my perspective, if you believe he is insincere.
i don’t.
From my perspective, Edwards activities relating to the Center don’t pass the smell test.
Though I have no use for Jonah Goldberg generally , his editorial on Edwards a couple of weeks ago– that broached the issue of the Center–is difficult to dispute.
If he is the Democratic nominee, his Republican opponents will have a field day.
Better to focus on this now–because it could well be the focus later.
i agree with PaulD. much better to discuss it now than latter.
I think that the Democrats will have a major problem on their hands if Edwards is nominated. Bush’s Justice Department will undoubtedly launch an investigation and the investigation alone will bring down any party nominating Edwards. Someone who appears corrupt, as is the case with what Edwards did here, cannot attack anyone on corruption.
The Democrats need a clean candidate who has not engaged in corruption. A clean candidate can establish a clear difference between himself and the Bush Administration.
it is far from clear that Edwards did anything corrupt.
it only bears examination at this point.
Okay, I’m still seeing very little substantive discussion of the story on any of the lib-blogs (please stop calling them ‘left-wing’; real left-wingers don’t follow campaign stories a year and a half out), so at this point Hilzoy’s characterization seems more warranted.
There’s not even a mention on MyDD. The dKos front-page post and 90% of the discussion in comments miss the point and fail to engage the central issue of the NY Times story. Please feel free to link to anything anywhere else I might have missed.
To me, the real question is why set up a 501c4 as opposed to a campaign organization. You don’t pay taxes on the contributions in either case, so the ‘tax exempt’ part is irrelevant. The advantages would seem to be:
– projecting a nobler, larger goal than a political campaign (and thus getting participation, including contributions, from some who might not hook up with an overt campaign committee)
– more donor privacy and looser limits on scale of contributions.
The ratio of campaign-like to policy activities is what would determine whether the spirit of the 501c4 had been violated or whether there was just a happy convergence. If the policy activities dominated, then the donor privacy and broader limits seem fine. If not, they don’t.
In my experience and understanding, the political activities allowed and encouraged by c4s, the very things that make c4 contributions non-deductible, are supposed to be primarily lobbying and policy advocacy, not electoral activity. C4s are permitted to do some things that have an electoral impact, but it can’t be the primary purpose of those activities. When c4s begin to do enough electoral engagement to raise questions of skirting the line, they are well advised to start up PACs to avoid endangering their advocacy work and donors. I worked for a national network of c4s that went through this very transition in the early 1980s. However, the campaign and tax laws have changed hugely since then, and I’m no expert.
As Lizard Breath says, an informed discussion would have to call on the expertise of people who do understand the current legal environment.
Another relevant questions: Have other politicians done anything directly comparable or similar? If so, those examples should have been mentioned, if not discussed, in the story.
I wouldn’t go so far as to characterize this as “corruption”, on the basis of what I now know; it’s not as if the point were Edwards’ personal enrichment. The point is that a c4 has been used where a campaign committee would seem to have been more ethical and appropriate.
And politically smarter. Aside from the legal questions, this is a bad idea politically: It reinforces the inevitable accusations from Republicans about tricksy trial lawyers, and it risks making anti-poverty concern look like more of a vehicle than a cause.
Self-inflicted wounds are the most painful kind. There are a lot of questions I need answered before I’d make a harsh judgment on legal or ethical grounds. But, unless I learn much more to counteract the effect of the story now, I have no trouble rendering a political judgment: it looks bad.
Nell: Another relevant questions: Have other politicians done anything directly comparable or similar? If so, those examples should have been mentioned, if not discussed, in the story.
In an update to his Edwards nonprof post, Captain Ed recalls that John McCain did something similar several years back. I’m nowhere near an expert in the minutia of US electoral law, but perhaps someone better educated in such matters (anyone? anyone? Bueller?) could shed further light on how McCain’s set-up compares with Edwards’.
If you want an example of beneficiaries of the CPO (and not the CPOF) here’s an article that might be helpful. It describes several students who went down to New Orleans as part of an alternative spring break program to help rebuild Katrina-damaged houses. Their meals while in New Orleans were paid for by CPO through the “Opportunity Rocks” program.
This is a stupid but important criterion for me in casting my primary vote. I want to see the Edwards campaign tear up the article in the next ten minutes.
Not stupid at all, Rilkefan. We nominated one spin-impaired Dem in 2004, & saw him flounder miserably.
That’s one thing I like about Hillary — she’s learned the hard way.
Via a commenter at the TPMCafe post hilzoy cites, the sidebar of a late-Friday AP article on the Edwards nonprofit contains a link to the 2005 tax filing [pdf] of the Center for Promise and Opportunity.
I have neither the time nor inclination to study it, but hope others will. Analysis of the proportion of spending on anti-poverty policy development, advocacy, and action vs. non-poverty-related campaign activity will tell the tale on whether the NYT story is a hit piece or not. [Aside: It’s shoddy and muy, muy 20th century for the NYT not to provide a link to the public document on which its front-page story is based.]
Neil, thanks for the link to the story of the Katrina cleanup.
Nell: I found the 2005 filing, and put the numbers here.
Hilzoy, you’re asking the wrong question. The question you should be asking is, “Why is the Times running this story?”
Bush’s Justice Department will undoubtedly launch an investigation and the investigation alone will bring down any party nominating Edwards. Someone who appears corrupt, as is the case with what Edwards did here, cannot attack anyone on corruption.
The Democrats need a clean candidate who has not engaged in corruption.
It isn’t enough to be clean. They need a candidate who cannot possibly be made to look dirty by a dishonest campaign that has the media behind it.
I would say that Hilzoy’s summary of the expenses looks a bit unfair. Hil- You cropped the ‘retreats and seminars’ texts to ‘retreats and seminars with foreign policy experts.’ The full text on the return is ‘Retreats and Seminars — held with foreign policy experts to discuss Iraq, promotion of democracy and freedom throughout the world, and seeking solutions to the challenge of global poverty; discussion of poverty with elected officials and constituency group leaders; and discussion with advocates and experts regarding responsible fatherhood and teen pregnancy.’ That looks much more poverty-focused and appropriate than your summary, doesn’t it?
And the ‘New Ideas’ bit again seems like exactly the sort of thing a c4 is for — it’s supposed to be a thinktank, not a direct charity. If he’s not using it for electoral expenses, I’m really not seeing the problem.
LB: I was cropping for space purposes (plus a lazy disinclination to type it all out), but I probably should have included the whole thing. I think a lot turns on what, exactly, the ‘new ideas’ stuff includes, since it’s most of the spending.
Also — and this is just a musing brought on by this line of thought — I’d think it would matter, for a think tank, to have some sort of product — papers, books, public seminars, private seminars for some class of people not defined as ‘this candidate’, etc.
I mean: I hope, at least, that it would not be OK for me to set up a 501(c)(4) called the hilzoy continuing education fund, and charge all my book purchases to it, on the grounds that that contributed to the common good. This would be less problematic than it would be if I were running for office, since then the campagn finance laws would come into play, but even without them, I would think that the continuing education of me is not an appropriate purpose for a non-profit that’s supposed to contribute to the common good.
That’s why I think: having some sort of product emerge from the thinking ought to matter — to distinguish a think tank from a continuing education fund, and also to provide some reason to suppose that the continuing education of someone actually does contribute to the common good (more directly than via the thought: an informed citizenry is good; I am a citizen.)
TPM has a lot of commentary on this.
Greg Sargent’s piece makes a persuasive case that this is a NYT hit piece because the article fails to back up its obvious assertion that this was done primarily for Edwards political career.
and judging by the restraint shown here by nearly everyone, it is clear that the Times did not provide convincing proof of it’s lede:
John Edwards ended 2004 with a problem: how to keep alive his public profile without the benefit of a presidential campaign that could finance his travels and pay for his political staff.
Mr. Edwards, who reported this year that he had assets of nearly $30 million, came up with a novel solution, creating a nonprofit organization with the stated mission of fighting poverty. The organization, the Center for Promise and Opportunity, raised $1.3 million in 2005, and — unlike a sister charity he created to raise scholarship money for poor students — the main beneficiary of the center’s fund-raising was Mr. Edwards himself, tax filings show.
Given that I was doing the special pleading above, I should note that Sargent has a followup in which the Times responds to his criticism, saying (implictly but unambigiously) that the Edwards campaign did offer to put them in touch with scholarship recipients, rather than with anyone (like the residents in the houses rehabbed in New Orleans by students funded by the CPO) directly funded by the CPO.
I’m still having trouble reading that as more than a screwup, though — given that there appear to be beneficiaries of the correct organization, offering beneficiaries of the wrong organization wasn’t relevant, but doesn’t seem to get the Edwards campaign anything they couldn’t have gotten out of offering a relevant beneficiary.
And, of course, given that response from the Times, it’s unclear why the conversation didn’t go as follows:
Edwards campaign: But to get a rounded picture of the CPO, why don’t you talk to some beneficiaries, like these scholarship students?
Times: No, thanks — they’re irrelevant, we’re not looking at the scholarship fund.
Edwards campaign: All right, how about these students in the Opportunity Rocks program, or these people who got their houses rehabbed? Those were funded by the CPO itself.
Times: Okay, those people we’ll talk to.
This seems as though it must have been the result of some sort of miscommunication.
“This seems as though it must have been the result of some sort of miscommunication.”
I expect the Times to have shoddy coverage of my candidate – but I expect my candidate to go out of his way to make sure all the necessary information reaches the Times regardless (even if it’s ignored).
I share rilkefan’s expectations, and would further expect documents put out to media and major bloggers to combat the innuendo.
If they’ve done that, it’s taking a while to show up. But maybe it has? I’ve been focused elsewhere since my last post.
And not focusing very well even when my attention is here; I completely missed hilzoy’s report from the tax filing and LB’s response to it. Sorry.
Nell, Greg Sargeant’s current post is pretty good – I assume TPM would be on top of anything new.
My uninformed guess – the Edwards campaign was focussed on something of a message retool and just isn’t quick on its feet.
Nell: all I’ve seen is this:
Also, his blog has statements from someone who got a scholarship from the CPO Foundation, and someone who went to New Orleans over spring break with Opportunity Rocks. If there’s more out there, I haven’t seen it.
***
Question for anyone who’s still reading this: I don’t think this is the most important issue ever. But I do think there’s a lot of complete mischaracterization of the issues out there. Some of it is just dumb (a lot of the ‘ha ha, corporate interests are coming after someone who threatens them!’ stuff that doesn’t bother to address the actual issues, for instance), but some is not. Would it be worthwhile to do a “here are the facts; here are the issues” clarifying post? Or would that be overkill?
(I ask partly because I have a mild fever, which always destroys my judgment 😉 )
Would it be worthwhile to do a “here are the facts; here are the issues” clarifying post? Or would that be overkill?
That would be very much worthwhile, I would think. Though perhaps not as worthwhile as your taking a break & getting over your bug.
I vote for waiting for more data.
I vote for giving it a day or so for the best counterspin to come out, but at that point, I would be interested in reading a reasoned analysis of this story. You would probably get some hell for “keeping an attack story alive,” but this site isn’t supposed to be partisan.
This is like criticizing Edwards for driving 54mph in a 55mph zone. He did nothing illegal. Period. Next issue, please.
The current TPM defense is weak. It seems to say that the New York Times couldn’t prove that Edwards had personal political intent when forming the group. That’s true, but also true of almost all reporting. The facts themselves make it strongly appear that Edwards attempted to use it for campaign-like functions. Maybe Edwards can bring more facts to light which will change that impression, but “no one can read my mind” isn’t good enough.
“It seems to say that the New York Times couldn’t prove that Edwards had personal political intent when forming the group. That’s true, but […]”
But the NYT wrote, “the main beneficiary of the center’s fund-raising was Mr. Edwards himself”. They have to say, “It was unclear how much of the center’s fund-raising benefited Mr. Edwards” – what they wrote is simply a lie based on the available facts.
“The facts themselves make it strongly appear that Edwards attempted to use it for campaign-like functions.”
Or, well, perhaps you can tell from the article what percentage of the center’s funds didn’t go to poverty-related activities.
I’m with LB et al on this. On the tax side, using a (c)(4) achieves the appropriate treatment: no tax due on contributions, no deduction for the donors. If there’s a problem, it’s a campaign-finance problem, not a tax problem. My strong impression is that campaign finance law is all legalisms and technicalities and that everyone in that business is busting their butts to figure out better ways of raising more money with less public disclosure to fund politicians’ efforts to do politician stuff. If that’s accurate, questions about the morality of such things are properly addressed to the whole system, not to one politician’s efforts to make it work for him.
My sense is that a lot of what’s going on here is that people see “501(c)” and “tax-exempt organization” and start thinking about what is and isn’t OK for charities. But a (c)(4) is quite a different animal than a (c)(3), and IMO there’s a lot less room for moral outrage when you’re not talking about something that’s particularly tax-favored.
I’m still not much of an Edwards fan, and at first glance I kind of wanted to join the pile-on, but I think this one’s bogus.
“Or, well, perhaps you can tell from the article what percentage of the center’s funds didn’t go to poverty-related activities.”
It looks to me that around 80% of the funds didn’t go to poverty-related functions in the normal sense of the idea.
It looks to me that around 80% of the funds didn’t go to poverty-related functions in the normal sense of the idea.
But given what you’ve previously written about poverty, I’d never take you seriously when you made any assessment of political/charitiable efforts to combat poverty.
(What I think about this story, I wrote in my journal.)
“But given what you’ve previously written about poverty, I’d never take you seriously when you made any assessment of political/charitiable efforts to combat poverty.”
That doesn’t make much sense. I’m gay, but that doesn’t mean I’m incapable of noting that female super-models make lots of money. Just because I’m Republican doesn’t mean that I’m incapable of noting where expenditures get spent. Furthermore hilzoy wrote the post and in comments showed the break-out of expenditures. You engaged in a completely gratuitous swipe.
In any case, if there is a legitimate explanation for the expenditure ratio, I’m sure we’ll hear it today. The campaign has had the entire weekend to formulate a response now.
I’m gay, but that doesn’t mean I’m incapable of noting that female super-models make lots of money.
I really didn’t need to know that.
In any case, if there is a legitimate explanation for the expenditure ratio, I’m sure we’ll hear it today.
What would you expect a think-tank type foundation, not putting itself forward as a charity, to spend its money on?
I can see an argument that Edward’s participation in the CPO was beneficial to his campaign to a point that made it improper. I don’t agree, but I can follow it. But arguing that there’s something wrong with a think tank because it isn’t a soup kitchen seems screwy.
“It looks to me that around 80% of the funds didn’t go to poverty-related functions in the normal sense of the idea.”
I don’t understand how you can make this assessment, or what “in the normal sense of the idea” means.
Here’s Edwards’s response.
Simple. The issue isn’t whether Edwards did anything illegal.
The issue is whether he did anything that Republicans can disapprove of.
The specific grounds for disapproval aren’t important. Has Edwards done something which can be made to look kind of shady? So long as the media cooperate, that’s all that matters.
“Has Edwards done something which can be made to look kind of shady?”
Has Edwards done something which can be made to look pretty spotless? If he can’t convince the people here of that, it’s bad. Seems like he’s hardly trying though.
“I can see an argument that Edward’s participation in the CPO was beneficial to his campaign to a point that made it improper. I don’t agree, but I can follow it. But arguing that there’s something wrong with a think tank because it isn’t a soup kitchen seems screwy.”
It isn’t just his participation that is shady. In fact, his participation alone is maybe slightly suspicious at best. It is the five members of his old campaign staff who went on to work there and have since joined his new campaign staff (Miles Lackey, a senior Edwards adviser; Peter Scher, an Edwards adviser and former campaign manager; David Ginsberg, a senior campaign adviser; Ed Turlington, Edwards’ former campaign chairman and current adviser; and Alexis Bar, Edwards’ former scheduling director.) [Bar is the only one of the 5 not currently working for Edwards in his new campaign], combined with the travel, combined with foreign policy meetings, combined with a lack of expenditures on actual measures, combined with a lack of “think-tank” output other than sending Edwards to meetings and having him make public appearances. All those things combine to make it appear as if he was just using it as a way to maintain his campaign staff before he had an official campaign (and without having to make the disclosures that would be necessary to do so).
I don’t think there’s anything wrng with a think tank not being a soup kitchen. I do think it’s worth asking whether this organization meets the requirements for a 501(c)(4). In that context, I think it’s really important to ask exactly how Edwards’ activities are suposed to benefit the public. In some cases, I think this is clear: Opportunity Rocks, for instance. But that’s a small (11%, iirc) percentage of the total expenditures.
In others, it’s not clear at all. The seminars, for instance: since (as I said above) there is no output that could create some “public benefit”, its hard to see how this is suposed to work, unless “public benefit” is construed so broadly that “an informed citizenry is good, JE is a citizen, so informing him must be good” counts. (In which case, why not: “homelessness is bad, paying my mortgage will prevent me from being homeless, so I can set up a non-profit to pay my mortgage? Or, for that matter, “people getting what they want is good, I want a Lamborghini, so I set up the hilzoy Lamborghini fund”?)
Likewise, on-site investigation of problems facing Americans. Again: I would love to have a tax-exempt organization funding my on-site investigations of, well, everything. But I would think there would need to be some connection between this and the public good, other than the phoney ones listed above. I would need to report on what I found, or hold public educational events, or, well, something.
This is one of the points that I think people are confused about: even when they get past the “it’s not a charity” point, a lot of comments I’ve read in various places seem to think that just having an organization do things that are, in some sense, “about” poverty is enough, even if it’s just: John Edwards bringing people in to tell him about poverty. do not think this is right.
Part of the reason I was tempted to write the ‘just the basics’ version is because I really don’t think people see this — even when they aren’t in full-bore “the media is out to get him” mode.
In others, it’s not clear at all. The seminars, for instance: since (as I said above) there is no output that could create some “public benefit”, its hard to see how this is suposed to work, unless “public benefit” is construed so broadly that “an informed citizenry is good, JE is a citizen, so informing him must be good” counts.
Again, I’m not clear about what the expected output is. Edwards wasn’t the only attendee at the various seminars, meetings, etc — in theory they allowed influential people concerned with poverty to meet with and discuss ideas with each other. It’s soft stuff, but not surprisingly different from any other convention sort of thing.
“In others, it’s not clear at all. The seminars, for instance”
which to be consistent you ought to dismiss as “a small percentage of the expenditures”. And since they included “seeking solutions to the challenge of global poverty; discussion of poverty with elected officials and constituency group leaders; and discussion with advocates and experts regarding responsible fatherhood and teen pregnancy” I have trouble seeing what the problem is. The important question is the new ideas stuff – the story so far boils down to, The CPO spent money in ways we might not like though we have zero data to draw any conclusions. By this standard any candidate – any undertaking – is in trouble.
As to SH‘s point about staffers: it seems to me that Edwards’s main campaign plank is to actively address poverty, so I don’t see any problem with the same people working serially in different phases on that project.
“As to SH’s point about staffers: it seems to me that Edwards’s main campaign plank is to actively address poverty, so I don’t see any problem with the same people working serially in different phases on that project.”
The point is that they were supporting his campaign before it was official.
Let me put it another way. Let’s presume that you just wound down a presidential campaign and decided you want to form a great non-profit group/think tank about poverty. What are the chances that the best people you could find happen to be your 3 senior campaign advisors, your campaign manager, and your scheduling manager? You aren’t having another campaign, so you might suspect that these people want to go to other jobs. But they are so dedicated to the anti-poverty cause that they are willing to abandon their previous lives as campaigners and start up a very important think tank. That really isn’t their expertise, so you probably could have some better people for that purpose but for some reason you hire them anyway. They discover that the best way to fight poverty that they can come up with involves flying their former candidate around for meetings, engineering foreign policy meetings on the Iraq war which let this former candidate say that he regrets his vote on it, and donating less than 10% of the money to projects.
When their former candidate decides to run again, they abandon this really important anti-poverty effort in order to resume their former jobs as campaign advisors and the organization pretty much falls apart.
Alternatively you could suggest that it was his campaign-in-waiting which has seamlessly transitioned into his formal campaign organization.
I would say that the first explanation is a little tough to swallow, but certainly you can admit that the latter explanation looks at least as likely from what we have available to us.
Oh, I don’t think there’s any doubt but that the CPO was at the very least thoroughly coordinated with the planned future campaign; the question is whether that’s wrong in itself, and I don’t think it is.
There are two questions here — did the CPO do what a 501(c)(4) was supposed to do? If not, that’s a problem in itself. And if it did what a 501(c)(4) is supposed to do, but did it in a fashion also calculated to benefit Edwards’ campaign, is that a problem?
On the first question, I really don’t know, but no one raising questions has convinced me that they know either. Meetings and seminars and such with influential people seem like the sort of thing this sort of organization does, and I haven’t seen a convincing contrast between what the CPO did and what another 501(c)4 might properly do. If one can be drawn, then I do agree that Edwards’ conduct was improper.
On the second question, that doesn’t seem unsavory to me. Campaign finance laws are inherently technical — I don’t think they have a ‘spirit’ to be violated, only a letter. If, for example, Edwards had founded a 501(c)3 charity, that genuinely provided validly charitable services as it was supposed to with no more overhead than was conventional, it wouldn’t bother me that the charity was as entwined with his campaign as the CPO was, so long as expenditures were kept separate within the letter of the law.
LB: check out the regs on 501(c)(4)s here. Excerpt:
About politics:
Examples other than volunteer fire departments and civic associations:
As far as we know, the Edwards organization spent 11% of its money on Opportunity Rocks. The rest went to management, fundraising, the seminars that might or might not have been public, but that do not seem to have resulted in any public product, and the generation of new ideas, including on-site visits to places with problems, which (again) does not seem to have resulted in those ideas’ being made available to the public in any obvious way.
I think there’s a pretty serious question about whether its work counts as serving the public good, as opposed to the good of a private individual or individuals. If an organization that serves the tenants of a particular building, as opposed to all tenants in the community, is not supposed to apply for this status, I think there’s a serious case for asking how, exactly, E’s various poverty-related activities actually produced some public benefit.
check out the regs on 501(c)(4)s here.
That’s technically an IRS publication, not the regs themselves, although it is largely based on the regs.
Regards,
Your Friendly Neighborhood Pedantic Tax Lawyer
“the generation of new ideas, including on-site visits to places with problems, which (again) does not seem to have resulted in those ideas’ being made available to the public in any obvious way”
Presumably Edwards is campaigning on those ideas, which couldn’t be more public.
Oh, it’s a fair question, I’m just not sure of the answer. What I’m thinking of is things like the Davos meeting — it’s a bunch of very powerful people meeting to exchange ideas, that produces no significant publically available output that I’m aware of. But it’s supposed to be a useful and important event.
If the CPO devoted its funds to setting up meetings with the prestige and importance of the WEF meeting at Davos, focused on poverty, that would appear to me to be an activity with public benefit even without identifiable publicly available workproduct — the opportunity for people in positions of power with the capacity to affect problems relating to poverty to meet and exchange ideas seems to me to be valuable in itself. And it’s not clear to me that that isn’t (except for the different levels of prestige) largely what the CPO was doing.
rilkefan: yes, but then we come up against the fact that for these purposes, “Promoting social welfare does not include direct or indirect participation or intervention in political campaigns on behalf of or in opposition to any candidate for public office.” Of course educating John Edwards would contribute to the public good even more if he became President, but I think that’s not allowed either.
Ugh: thanks. Am I screwing this up at all?
hilzoy – not that I can tell, but as I said upthread I tend not to work in this area (and I haven’t really read closely as I only skimmed most of the comments after Friday).
In perusing the biography of the former IRS’s official quoted at the end of the article (25 years at the IRS and now at Caplin & Drysdale in DC),* I see no reason not to take his word that Edwards was skating close to the line – other than perhaps the info provided to him by the NYTimes was inaccurate/incomplete.
*argument from authority blah blah blah
It would be quite tedious and a waste of resources for nonprofits to have to write up some publicly available work product to prove that every meeting/seminar/conference/whatever they held was beneficial to the public in some way. A lot of those things don’t turn out to be much use; a lot of others are useful primarily for what is learned by the participants & no one would actually benefit at all from their posting “what I learned at the seminar” papers on their websites. A lot of factfinding investigations also do not lead to formal, published reports, even among organizations that specialize in factfinding.
Arguably, while it’s fine for a *given seminar* not to result in some tangible piece of paper you could call a public benefit, your over all organization needs to do so. But there’s a pretty broad definition of what qualifies as a “public benefit”–I do not think that Focus on the Family’s and the Family Research Council’s lobbying arms benefit the public by sponsoring “Justice Sunday” but they are 501(c)(4)’s all the same. Did Edwards’ organization really NOT? I realize that “serving as Edwards’ campaign policy committee on poverty” is not an allowable 501(c)(4) committee project, but does the fact that he later ran for president & probably intended to do so all along strip his pre-campaign issue lobbying on poverty of all value? As a matter of actual public benefit from the think tank–I don’t think so. As a matter of law–I don’t know, but no one seems to be ready to argue that it does.
A politician doing charitable & advocacy work may always have some ulterior motive about helping his public image, but as long as he’s doing real advocacy work–I could write an article insinuating that Bill Clinton’s various projects are just a way of restoring his image in time for 2008; does that mean that his involvement isn’t really nonprofit advocacy?
Also, what does “management” as an expense mean? There’s an implication that it’s not okay for a non profit to spend $ on salaries, but certain non profits OUGHT to be spending a huge % of their $ on salaries, particular think tanks, policy advocacy groups, etc.
rilkefan: yes, but then we come up against the fact that for these purposes, “Promoting social welfare does not include direct or indirect participation or intervention in political campaigns on behalf of or in opposition to any candidate for public office.” Of course educating John Edwards would contribute to the public good even more if he became President, but I think that’s not allowed either.
But then look at the next sentence: “However, if you submit proof that your organization is organized exclusively to promote social welfare, it may still obtain exemption even if it participates legally in some political activity on behalf of or in opposition to candidates for public office.” So, even straightforward activity on behalf of or in opposition to a candidate doesn’t give a 501(c)4 cooties if the organization is organized exclusively to promote social welfare. This sentence looks like permission for a 501(c)4 to snuggle right up against the line separating a non-profit from a campaign organization.
And to make it clear, the CPO looks to have been right up against the line — it’s just that in the campaign finance area, technical legality is, IMO, enough. These are technical laws that don’t have ethical penumbras around them.
Katherine I don’t have a problem with the existence of ulterior motives, but the point of it is that a lot of the expenses look like Edwards “developing ideas” and so forth, without any indication of how his developing these ideas will ever benefit anyone other than him through some non-campaign-related channel. If the money were used for advocacy, it would be easy to see how it would produce public benefit. Stuff that looks more like personal learning, figuring out what to think about foreign policy, “on-site” surveys of problems facing Americans, less so.
I don’t mind that a non-profit in theory has largish management expenses. The problem here is that the management in question was almost exclusively his former campaign staff and is now his current campaign staff. If the job history reads 1) Campaign Manager for Edwards, 2) Managed a non-profit organized around Edwards, and 3) Campaign Manager for Edwards and you get a similar thing for 4 people, that makes it appear as if the purpose of the non-profit is “direct or indirect participation or intervention in political campaigns on behalf of or in opposition to any candidate for public office.”
You don’t have to independently justify each meeting. But you should be able to justify say half of them, and/or you should be able to show some significant work product.
I think the two things that give the game away here are the number of very high level campaign hires who used this organization as a stepping stone between campaigns, and the foreign policy meetings. Both of those strongly contribute to the appearance that Edwards was using the non-profit for his campaign rather than the idea that the non-profit was using Edwards to fulfill its independent purpose.
I don’t really understand how you get to your conclusion from that reading. My reading of the language would suggest that a group such as a Fireman’s Association can engage in direct advocacy because it independently exists for a public good. The idea that such language authorizes a candidate to form a a group whose salaried managers consist almost exclusively of his former and future campaign advisers and which has as its major activity forming meetings with the candidate, strikes me as radically different.
With one campaign adviser it might look a bit odd. But with *five*?
By the time we’re checking out the intricacies of 501(c)4 regulations, I think maybe the original questions (“why is [no one else writing about this at all]? … why isn’t anyone on the left blogging about this?”) have been answered.
Thomas, not really. We seem to be doing it almost exclusively here.
Fine; but that goes to a combination of expertise and perhaps motivation that is apparently fairly rare. I don’t have the expertise, nor do I aspire to fine-tooth comb John Edwards’ nonprofit for malfeasance.
Edwards has a poverty agenda. He quite reasonably thinks a good way to advance that agenda will be to become president. He founds a nonprofit (or a pair of them, or something) that will advance both causes. He knows being a single issue candidate won’t help, and who knows — bear with me, this is a crazy idea I just had — maybe he suspects that if we get out of Iraq we’ll have more $ to fight poverty with. He hires like minded people to staff the effort.
I’m not incensed. Some people are. I’m not surprised that not many people are, and returning to my prior point, I’m especially not surprised that not many people write about it, given our widespread ignorance about the legal issues involved.
I think Thomas may have been intending to convey that the dry technicality of it all is offputting.
If the money were used for advocacy, it would be easy to see how it would produce public benefit.
That’s the thing — the description of the activities that CPO engaged in looks as though it did consist (or at least may have consisted) of advocacy, just not entirely of advocacy directed toward the general public. A Davos-like meeting of politicians and such can be a venue for advocacy directed toward the participants, not toward those not attending the meeting, and if the participants are powerful that can be of public benefit.
SH: I’m not seeing the *five* members of Edwards’ campaign staff as an independent issue, unless you start from the assumption that a coordinated relationship between the CPO and the campaign is in itself an offense. Given that a 501(c)4 is not something that must keep itself free of any hint of association with electoral politics — it’s allowed to work for or against candidates, in fact — the question is what they were doing for the CPO, not who they are. If the CPO’s activities were legitimate 501(c)4 activities, then that’s all I think is important.
Effective advocates need to know what they’re talking about.
The idea that money spent on salaries & research is wasted, as a general matter, unless you can prove how that specific meeting or that specific research led to advocacy, drives me nuts. I can see being uncomfortable about the interlocking staffs of this center & the Edwards campaign.
K: for me, it’s less that I can’t see how this or that meeting led to advocacy, and more that something like 90% of the budget is spent on stuff whose connection to advocacy, or any other version of public benefit, is pretty obscure. (And Opportunity Rocks did not require over a million dollars of research.)
I’m getting the impression that my argument that meetings and seminars can count as advocacy, and produce public benefit, even in the absence of public workproduct, is not convincing you.
That’s a good point LB, as I noted I haven’t read the thread carefully, but hilzoy can you (or someone else) point out where you get the work-product requirement from?
“The idea that money spent on salaries & research is wasted, as a general matter, unless you can prove how that specific meeting or that specific research led to advocacy, drives me nuts.”
The thing, for me at least, is not that there couldn’t exist some non-profit somewhere that did lots of research and took a long time before it had work product. The regulations are pretty clear that 501(c)(4) organizations aren’t supposed to be used as a mechanism to avoid the candidate contribution rules. Mere unproductive or seemingly unproductive meetings isn’t enough for suspicion. This looks odd because the entire life cycle of the organization appears to be:
1) Hired 5 of the highest level campaign people from Edward’s staff
2) Organized a bunch of policy meetings which have the appearance of being about getting Edwards in front of people.
3) Organized a foreign policy meeting which doesn’t fall within the organizations purview much at all, but which does serve as a backdrop for Edwards to outline the change in his foreign policy ideas since his vote for the Iraq force authorization.
4) Gave a token amount of money to pretty obvious project.
5) Wound down when four of the five managers rejoined Edwards’ campaign staff.
If you just had unproductive or not directly-traceable-to-any-particular-project meetings, that would be one thing. Some group are failures and others are subtle.
Lizardbreath, I wouldn’t be happy to see Davos qualify as a 501(c)(4).
The thing is, I’d take that as a fair criticism of the CPO if I were taking it as a given that its activities were unproductive other than as support for the Edwards campaign. I haven’t seen convincing support of that — it’s not clear to me that its activities were unproductive, or further that they were unproductive to the point of being a clear sham.
LB and ugh: I’m trying to construe promoting “the common good and general welfare of the people of the community” as best I can. The IRS thingo seems to require that the benefit be to everyone, or at least every member of a class like “tenants”, not like “tenants in this building”. I’m thinking that of course if you had, say, a group that held flower shows for all local gardeners, you would of course not have to produce some sort of “work product” other than the show, but that’s because this wears its public benefit on its face.
A private seminar, by contrast, looks a lot like something that benefits the people who attend, not the public — more like an organization of tenants of building X, or even an organization of my friends who are tenants. I was thinking, then, that it needed something that would be its public benefit.
I’d also think that holding something like seminars on water law for all new Congresspeople would clearly count, but seminars for a chosen ten congresspeople might not.
“I haven’t seen convincing support of that — it’s not clear to me that its activities were unproductive, or further that they were unproductive to the point of being a clear sham.”
Yes – unless Edwards puts the CPO budget and transcripts of all the meetings online, I don’t see how one gets past the unuseful tautology that how the money was used is obscure. If there’s some reporting requirement, then ok – but unless every candidate with such a 501 etc puts everything online, I don’t see what Edwards is doing in this story except getting smeared by the NYT. Maybe one wants one’s candidate to be like Caesar’s wife – given the quality of current politics, I don’t know that I do.
“I’d also think that holding something like seminars on water law for all new Congresspeople would clearly count, but seminars for a chosen ten congresspeople might not.”
I think this is way off. These aren’t continuing ed credits for Congressmen; a “seminar” is an advocacy meeting. Boy would I love to be able to force even 10 Congressmen to attend a seminar of my choosing…
(now, if the only influential person the org ever advocated to or held a seminar with is John Edwards, you have a problem. But as far as a general “private or small group seminars aren’t a public benefit rule–no, I don’t think so at all. Not based on how nonprofit lobbying tends to work).
“I haven’t seen convincing support of that — it’s not clear to me that its activities were unproductive, or further that they were unproductive to the point of being a clear sham.”
Well of course not. If we don’t have transcripts or useful outcomes we don’t know. That is why I would say that the mere fact of not-obviously-useful meetings isn’t enough. But such meetings, with pretty clear campaign related foreign policy meetings, combined with every single member of the high level staff also being very highly paid campaign staff both before and after the organization, lends an “I’m getting away with having a campaign staff and organizing campaign meetings without having to go through campaign disclosures” look.
I don’t see what this has to do with an “everybody is doing it” defense either. So far as I can tell, no one else is as intimately tied to a 501(c)(4) as Edwards, though if it turns out to be ok for him, I suspect it will the new thing.
So far as I can tell 501(c)(4)s which engage in advocacy are supposed to be advocacy groups like the NRA, or AARP, or MoveOn, etc. They are allowed to avoid campaign laws because they have an strong independent purpose which is sometimes furthered by helping out candidates, but they aren’t tied to any particular one.
To allow “anything a candidate expresses political interest in” to be enough, seems like a complete waste of distinction between this and a campaign.
Further evidence that we haven’t talked much about is that the very existance of the organization seems to be winding down now that the campaign is winding up. That doesn’t make sense if it were really independent of Edwards’ campaign. So the life cycle is:
Campaign Ends
501c4 formed entirely with officers from campaign staff.
Edwards attends meeting with high level people paid for by the 501c4.
501c4s major public expenditure “Opportunity Rocks” consist of what looks a lot like stump speeches by Edwards.
Campaign begins and campaign staff leaves the 501c4.
501c4 effectively ceases to exist. (Note that so far as I can tell from internet archive, their website was only active until during 2006)
That just looks odd for an organization independent of its candidate.
If Edwards had decided not to run this time, would that make the 501 ok? If so, then doesn’t this turn on mindreading?
“now, if the only influential person the org ever advocated to or held a seminar with is John Edwards, you have a problem.”
This is an interesting test. My uninformed impression was that these were “meet with John Edwards” to talk about your issues type seminars, but on re-examining the news reports I formed that based on the foreign policy meeting. It will/would be interesting to see how many of the major seminars didn’t involve John Edwards’ direct attendance.
Further evidence that we haven’t talked much about is that the very existance of the organization seems to be winding down now that the campaign is winding up. That doesn’t make sense if it were really independent of Edwards’ campaign. So the life cycle is:
It’s perfectly obvious that it was not, in a real world sense, ‘really independent of Edwards’ campaign’, and if you’re convinced that’s enough to make it improper, the discussion is over for you. I think the appropriate question is whether the activities it engaged in were for the public benefit rather than being simply campaign activities, and it seems reasonably likely that they were.
I’m really thinking that this is more an indictment of the faux naivete of our media and election process (which is in turn an indictment of us, I hasten to add) Ohmigod, Edwards was thinking of running for President after 2006! How could he! If he were at all honest, he would have declared when he was standing next to Kerry during the concession speech!
In a sane world, accepting that there has to be regulatory control of the money should automatically result in an understanding that the bright lines created by such a regulatory scheme are just an epiphenomenon, and we should grant some measure of reasonable doubt. Instead, we have a situation where Edwards is the subject of front page NYT’s articles while Sam Fox, the financial supporter of the Swift Boats gets appointed to be ambassador to Belgium and everyone says well, what do you expect.
Ironically, I’ve done some work with two NPOs here in Japan, and with a group that has refused to take NPO status because they suspect that the NPO law is simply a stalking horse to control them. Given that these organizations were told that they had to go with NPO status or be hit with regular tax rates, it’s hard not to see their point.
“whether the activities it engaged in were for the public benefit rather than being simply campaign activities”
‘whether the activities it engaged in were for the public benefit as well as being campaign-related rather than being simply campaign activities’? Or maybe if you like my “what if didn’t run test” the former is correct.
Well, yeah, ‘what if Edwards didn’t run’, while not a useful source of information, is a good way of thinking about it. Say when Edwards got the bad news about Elizabeth Edwards’ cancer coming back, he’d dropped out of public life entirely — retired to be with her. The question is whether the people working for the CPO pack up and go home thinking “Damn, if he’s not running for president that was pointless” or whether they look back and say “At least we had two years to make our case to people and get some things done.”
Then of course there’s policy, which is hard.
I’m not convinced by the “what if he didn’t run” concept. His campaign staff thing looks suspicious, and when he starts up again and formally rehires them, the sham is revealed. The fact that we couldn’t show the sham before he restarted his campaign doesn’t excuse it.
By the way, since people were saying that the Center seems to be dwindling away: it is, in fact, defunct. When this happened I don’t know, but it was reported in the Business Week article. The CPO Foundation, by contrast, is still going, though Edwards cut his ties to it. It’s still giving out scholarships.
I certainly don’t insist you be convinced, but
“the sham is revealed”
entirely begs the question.
I think you have to say it’s inconceivable that he would have refrained from running or you have to take a somewhat different stance on the matter.
“I think you have to say it’s inconceivable that he would have refrained from running or you have to take a somewhat different stance on the matter.”
I think if he wasn’t strongly planning on running again he would not have hired his 5 campaign advisers as the only officers of that organization. In that case we would be looking at something totally different.
And I didn’t start out thinking it was a total sham, when I read Hilzoy’s post I just thought it was suspicious. It was when I read about that staff going from campaign to ‘charity’ to campaign (with the charity vanishing as they left) that made me pretty sure it was a sham.
You’re right that we couldn’t be CERTAIN until he ran again. But it was strongly suggestive before that, and very strongly suggestive after.
It seems to me that if one sees Edwards as a person interested in ending poverty, the above has a simple reasonable interpretation. If one sees Edwards as a politician running for president occupying the anti-poverty niche, then, well, he’s a politician.
I want to thank everyone in this thread, which may be the only one of its kind in the blogs (calm, reasonable discussion of the real issues at the heart of the NY Times piece, and their importance or not in the scheme of things).
I’ve agreed with parts of almost everything said since my last comment. Refreshing!
“It seems to me that if one sees Edwards as a person interested in ending poverty, the above has a simple reasonable interpretation.”
I’m not so sure. It seems to me that if he were really just interested in that, he could have made some outside hires in at least one or two of the important positions for the charity. Surely it didn’t just so happen that the top members of his campaign staff were absolutely perfect for running a charity–so perfect that they didn’t even need their skills supplemented. And surely the charity would still exist? If the officers had been half campaign staff half something else I wouldn’t be so certain.
But my claim is that you see goals X and Y, with some small overlap, and I’m entertaining the possibility that the correct view is goal X, with subsidiary goal Y. In the latter view, the stuff about the money and the staffing makes (or can make, depending on the obscure details) perfect sense to me. Edwards can obviously do much more for X if Y, so if trying for Y makes sense then that’s what he should do. The Y effort obviously hurts an Edwards-associated charity, so he’s cut ties to the still-existing CPO. The new ideas stuff is fine in this scenario too – it’s good for X, and if Y it’s still good.
Probably the next thing to do would be to examine the particular staff involved and see if they were useful for X full stop.
Really though I’d want to see a substantive response from Edwards. Maybe that would (even in an it’s-all-ok scenario) be politically unwise, though.
You’ll have to define X and Y. It is my sense that you change it between clauses but I can’t tell for sure.
“Really though I’d want to see a substantive response from Edwards. Maybe that would (even in an it’s-all-ok scenario) be politically unwise, though.”
It isn’t likely to be all that unwise if its all-ok. I suspect you won’t ever be hearing a substantive response from Edwards. He’s had plenty of time now if he wanted to make one. I also strongly suspect that the 2006 filing detailing the expenses during that year won’t be on time now that the organization has been wound down.
If we suppose that Edwards was wrong to organise his group this way, what should he have done different?
Should he have made it a different sort of nonprofit that would have paid more taxes?
Is that the issue, that he didn’t pay enough taxes?
So if he did it wrong, he can reclassify it and pay his back taxes and it’s settled, right? And if the way he did it was legal then there’s no problem?
Or is this some sort of partisan political thing?
J Thomas: Or is this some sort of partisan political thing?
Well, duh.
I can completely understand Sebastian playing, but why is Hilzoy doing it?
Supporting the partisan attack out of a sense of honest inquiry, or what?
Oh, come on. I’m arguing that there’s nothing wrong with this so long as the CPO was doing work for the benefit of the public, and that nothing has come out to make it clear that it wasn’t. But it’s a close enough call that Hilzoy’s desire to analyze what Edward did is commendable, and while I think that to the extent she’s come to a conclusion that it is a problem, she’s mistaken due to an overly narrow conception of what ‘public benefit’ can mean, that’s no reason to say that she’s ‘supporting the partisan attack.
Sebastian:
I’m not so sure. It seems to me that if he were really just interested in that, he could have made some outside hires in at least one or two of the important positions for the charity. Surely it didn’t just so happen that the top members of his campaign staff were absolutely perfect for running a charity–so perfect that they didn’t even need their skills supplemented. And surely the charity would still exist? If the officers had been half campaign staff half something else I wouldn’t be so certain.
Again, this argument is only persuasive if you start from the assumption that it’s wrong to set up a 501(c)4 in relation to an expected future campaign, even if the work it does is proper 501(c)4 work. Obviously, the hiring of people who worked on Edwards’ campaign wasn’t pure coincidence, and anyone arguing it was would be laughable.
My argument is that there’s no obligation that a 501(c)4 be totally insulated from a campaign, other than financially (which no one’s claiming didn’t happen). If the staffers who worked both for the CPO and the Edwards campaign were qualified and competent, and the work they did for the CPO was appropriate, I don’t see that it matters that those same people might not have been hired in the absence of a plan for a future campaign.
No, it is wrong to set up a 501(c)(4) in relation to an expected future campaign unless the MAIN function of it is for the public benefit. And in this context, as hilzoy correctly points out, “public benefit” doesn’t mean anything close to “generally informative and good things for a hopeful presidential candidate.” At best, you can argue that they did some small amount of work that was clearly for the public benefit.
As hilzoy made clear above, that isn’t the burden that campaign related 501(c)(4)s work under. According to the regs: “Political activity. Promoting social welfare does not include direct or indirect participation or intervention in political campaigns on behalf of or in opposition to any candidate for public office. However, if you submit proof that your organization is organized exclusively to promote social welfare, it may still obtain exemption even if it participates legally in some political activity on behalf of or in opposition to candidates for public office.”
You are shifting standards from organized exclusively to promote social welfare to totally insulated. This doesn’t appear at all to be a group that is exclusively to promote the social welfare with accidental or incidental ties to a campaign.
The main public activity done by this group was organizing an Edwards speaking tour which if he had been *formally* a candidate at the time would have been easily identifiable as campaigning. The main expenditures were in the form of meetings and seminars (including one with foreign policy experts, not obviously related to the *stated* mission of the charity) in which various important people met with the not yet *formally* announced candidate. So Edwards was doing all the things he would be doing later in the formal campaign, but it was being paid for by this charity before he was *formally* announced. (The foreign policy meeting being a huge tell).
The charity was not staffed by professionals in the field–its officers were exclusively members of his past and future campaign staff. The charity existed *only* in the in-between formal campaigns period. As soon as the campaign *formally* began again, the charity ceased to exist. These are not characteristics of a charity which is “organized exclusively to promote social welfare”.
I do in fact have a political agenda, but it isn’t anti-Edwards. I think this case clearly demonstrates the futility of campaign finance laws. If you can fund this level of campaigning through a charity and avoid campaign finance disclosures, there really isn’t any point bothering with the rules. If you can get people like katherine, Lizardbreath and rilkefan to defend this level of ‘charity’ campaigning for an individual just screw the whole thing. Trying to draw hyper-fine lines that allow for your entire upper-level campaign staff to be involved in primarily arranging speeches and meetings with the candidate as a non-campaign ‘charity’ just isn’t worth doing. I’d like to think that if a Republican candidate whom I liked were doing the same thing, that I’d condemn such obvious game-playing–BUT I CAN’T. This kind of line-drawing is way too tied up in outcomes for most people to make unbiased judgments about it. In order to make it clear enough to make it easy to avoid bias, we would have to take much stricter steps against free speech. It isn’t worth it.
“If you can fund this level of campaigning through a charity”
Unless I’m confused, he had other entities funding clear campaign activities.
“The main public activity done by this group was organizing an Edwards speaking tour”
Here I’m also confused – I thought this was a subject of debate and obscurity above.
Above I meant X=anti-poverty efforts, Y=running for president. My claim is that the work product of the CPO was ok per se, so Edwards afterwards taking advantage of it in his campaign is ok. That’s why I mentioned the test of the staff – it’s a good way to show the CPO wasn’t X, but I suspect the staff was in fact well-qualified.
“If you can get people like katherine, Lizardbreath and rilkefan to defend this level of ‘charity'”
Also I’m not exactly defending Edwards, I’m defending him based on the data I’ve seen. Also, I don’t deserve that company – they know what they’re talking about, and I’ll defend anything.
As to the broader question of campaigns and money, I suspect I’m in favor of doing away with all this complexity and instituting a fully publicly-funded system.
Dude, it’s not a charity, it’s a non-profit. Calling it a charity would worry me.
Look at it a different way — look at what Al Gore does these days. Goes around giving speeches and so forth on global warming. Now, if he were to run for office now, what he’d spent the last eight years doing would look exactly like an extended political campaign, but given that he’s not, it appears to be a sincere attempt to draw attention to an issue he genuinely believes in. I don’t know that he’s in any way funded by a 501(c)4, but it seems perfectly appropriate that he could be.
Now, say he did plan to run for President again. If all the speech-making and such were for the public benefit in the absence of such plans, they’re still for the public benefit in the presence of such plans. And say he hired people he also planned to hire to work on his future campaign. If they’re effective at their jobs, the public doesn’t get any lesser benefit than if he’d hired different people. So, Gore, running for office now, wouldn’t have been wrong to have been funding his activities for the last eight years out of a 501(c)4, even if it were staffed out of his future campaign, and even if it were massively beneficial to that campaign.
So far, I’m very sure of myself. If you disagree with the Gore hypo, we disagree about the appropriate ethics here, and I doubt there’s anything we can do to convince each other.
Now, the question is whether the Gore hypo applies to Edwards. It doesn’t seem to me to be necessarily different from the Edwards situation, except in that the public benefit of the CPO is in part obscure — largely private meetings. (I would note that some of the activities that look most campaign-like, like Edwards’ speaking tour, are also the ones where the public benefit is least obscure: it is an attempt to draw public attention to poverty related issues). If the meetings, seminars, and so forth, were actually of private benefit only to Edwards, rather than to the public as a whole (through the influence of the decision makers who attended them), then I agree with you, and the CPO was an unethical evasion of campaign finance law. But you and Hilzoy seem to be assuming that as a factual starting point, and I don’t think that assumption is a fair one. It’s possible, but I don’t believe that you or I know it to be true.
J Thomas: Supporting the partisan attack out of a sense of honest inquiry, or what?
What LizardBreath said.
I’m actually ambivalent about this particular 501(c)(4)–I would need more information about what, if anything, it actually accomplished (and I don’t have it straight w/ the UNC poverty center thing). I didn’t agree with some of hil’s arguments based on thinking through how they would apply to other 501(c)(4)’s and even 501(c)(3)’s. It’s not always that easy drawing lines between issue advocacy & candidate advocacy & it’s very important for free speech reasons to do so. Of course there’s nothing in the First Amendment requiring the existence of 501(c)(4)’s but it’s the same sort of concern.
People have a knee jerk reaction in defense of candidates they like, sure, but it can be overcome. I just lack the information about the organization or the laws to overcome it.
I don’t really see how this shows we need to eliminate contribution limits to an actual candidate’s campaign, the DNC, or the RNC, which are pretty easy to identify.
And yeah, it’s NOT a charity; contributions AREN’T tax deductible; and 501(c)(4)’s often engage in what looks a lot like partisan advocacy. And LB’s question about Gore is right on.
J Thomas: Supporting the partisan attack out of a sense of honest inquiry, or what?
What LizardBreath said.
I don’t get it. It looks like a few apparently-honest people trying to get their own personal feelings settled about the public good, during an election campaign that will predictably be dominated by swiftboating republicans.
I just have a lot of concerns whether it’s ethical to do this in public under the circumstances. While the intention isn’t stab-in-the-back for a leading nonGOP candidate, that does look like the result.
“Unless I’m confused, he had other entities funding clear campaign activities.”
I think you’re confused. He *has* other entities funding his current clear campaign activities. He also *had* MoveOn.org fund some activity in early primary states (though if you can use someone else’s money rather than your own organization’s why not?). But that isn’t what I’m talking about. Lizardbreath and katherine both suggested that the meetings and seminars are opaque–we don’t know whether or not they were for public service other than campaign-style activity.
I’m saying that the non-opaque, publically accessible activity was funding what would be characterized as stump campaign speeches if he had been *formally* announced as a candidate.
When you substitute “anti-poverty efforts” for ‘X’ and “running for president” for ‘Y’ your statement translates directly into impermissible activity under the code because the organziation is supposed to be focused almost exclusively on anti-poverty efforts, but you say “In the latter view, the stuff about the money and the staffing makes (or can make, depending on the obscure details) perfect sense to me. Edwards can obviously do much more for X if Y, so if trying for Y makes sense then that’s what he should do.”
The problem I have with the idea that this organization is really mostly about non-campaigning anti-poverty efforts, is that nearly all of the things we can see that it actually did are exactly the type of things that Edwards would want to do for a campaign. It was funding stump speeches and meetings with the candidate (including a foreign policy meeting).
The foreign policy meeting doesn’t make sense in the context of the *stated* mission. But it makes perfect sense in the context of an ongoing Edwards campaign.
Hiring *all* of the officers for the charity from your once and future campaign staff doesn’t make sense in the context of the *stated* mission. But it makes sense in the context of an ongoing Edwards campaign.
Having your major public expenditure be stump speeches by Edwards for college students seems a little odd for the *stated* mission. But it makes sense in the context of an ongoing Edwards campaign.
The things we can see, seem really odd for the *stated* mission but make perfect sense for an ongoing Edwards campaign. I don’t see any reason to assume that the things we can’t easily see are much more for the public benefit than the things we can publically see. In fact I would tend to suspect that the public things are the best face, and the hidden things are less so (which may be unfair, but is certainly in keeping with the political context that we are talking about).
And as I said, I don’t think this should disqualify Edwards from being president nearly so much as I think it serves as an excellent indictment of the really stupid campaign finance system. Just let Edwards campaign constantly and let people give money to support him in doing that if he wants.
The stated mission is broader than just ‘antipoverty’ — it’s stated broadly enough to include foreign policy activity.
I’m guessing your last was written without reading my Gore hypo, which directly addresses the ‘stump speeches by Edwards for college students’ point you make. Any thoughts?
J Thomas: I don’t get it. It looks like a few apparently-honest people trying to get their own personal feelings settled about the public good, during an election campaign that will predictably be dominated by swiftboating republicans.
Yes, I think that’s right, aside from the slur on Hilzoy implied by “apparently”.
Hilzoy isn’t on John Edwards’ campaign team: she is not obligated to figure out a way of spinning the latest swiftboating. She is free to analyse this latest slur and figure out if there’s anything actually in it, which she is.
Even if she were determined to campaign for the Democratic nominee to be President, at the present moment in time, there is no Democratic nominee for President, and if you want to know why I think it never will be John Edwards, read my journal.
“I’m saying that the non-opaque, publically accessible activity was funding what would be characterized as stump campaign speeches if he had been *formally* announced as a candidate.”
That’s because everything you do or say in public is portrayed as an effort to advance your campaign if you’re formally announced as a candidate. Gore’s movie certainly would’ve been received that way. Issue advocacy & research by political candidates is seen as campaigning; issue advocacy and & research by non-candidates isn’t. I’m not sure that people who are seriously consdiering running for president should be forbidden from using 501(c)(4)’s to do issue advocacy.
In this particular case, it looks like it wound up as more of a vanity project for Edwards than an effective anti-poverty organization, and I think better of it if he’d either created a more lasting group or skipped it entirely, but I don’t know enough about either the law or facts to say whether he did something either illegal or corrupt.
“I don’t really see how this shows we need to eliminate contribution limits to an actual candidate’s campaign, the DNC, or the RNC, which are pretty easy to identify.”
But they aren’t easy to identify if you can run what is indistinguishable from a campaign under a non-profit for 2 years and then announce yourself later.
And how do you get around the foreign policy meeting? That isn’t anywhere near the *stated* mission but it makes perfect sense from a campaign perspective.
I also don’t find the Gore hypothetical all that helpful. All you are doing is showing that the line is almost impossible to draw until the candidate *states* that he is running. Which is exactly what I’m saying.
If the 501(c)(4) makes it this easy to get around campaign requirements, and if it is going to draw this kind of defense here (much less the completely avert-our-gaze response from the rest of the left-blogosphere) I can’t see that having these kind of fights–with hyper-partisan implications about whose ox gets gored–is worth the free speech implications.
Seriously, what about the foreign policy meeting. Doesn’t that make you guys a little bit suspicious? Doesn’t it make vastly more sense if the non-profit were essentially a continuing campaign?
I don’t know Sebastian. Who was there? What did they talk about? It’s plausible that it was improper. It’s even plausible that he violated campaign finance or tax laws. I just lack the necessary information, and I don’t think that people considering running for president should automatically be barred from directing 501(c)(4)s. Even if he did violate the laws–something that is quite possible, but not proven–there were activities that campaigns engage in that this organization quite clearly did not & could not have (e.g. running Edwards for President ads in Iowa; recruiting caucus organizers etc.), such that it is NOT actually even remotely plausible for a candidate to completely substitute this organization for a true campaign.
A final note:
we do not rely on the righteous indignation of the candidates’ supporters about the mere possibility of a violation as the mechanism for enforcing campaign finance laws.
I also don’t find the Gore hypothetical all that helpful. All you are doing is showing that the line is almost impossible to draw until the candidate *states* that he is running. Which is exactly what I’m saying.
No, I’m saying is that Gore, genuinely and forrealz, isn’t running for anything. But Gore is also, in his sincere estimation of the best public interest, is doing things that would be massively helpful for his campaign if he were running — going around and giving speeches. The point of the hypo is that you can’t look at activity and say “That activity is obviously beneficial to a campaign, therefore it isn’t in the public interest,” because there are categories of activity, like going around giving speeches on an issue, that are really genuinely and with no one pulling anything tricky, both beneficial to a campaign and in the public interest. I think that such activities can properly be funded by a 501(c)4 so long as they stay within the letter of the law in all respects, whether or not the benefit to the campaign is intended. (Which I agree in Edwards’ case it obviously was.)
And this:
Doesn’t that make you guys a little bit suspicious? Doesn’t it make vastly more sense if the non-profit were essentially a continuing campaign?
You don’t need to keep calling us naive, Sebastian. We aren’t overlooking the obvious, we’re disagreeing with you about the implications.
I’ve repeatedly said that this organization was clearly integrated with the planned campaign, and I’ll say that it seems clear to me that its activities were also intended to benefit that planned campaign. This does not appear to me to be improper so long as the activities were also calculated to benefit the public. Gore gives issue speeches, it’s for the benefit of the public, you can tell because he’s not running for anything; Edwards gives issue speeches, it’s for the benefit of the public even though he’s planning to run for something.(And look back at the tax documents for the stated purpose of the CPO — it’s stated broadly enough to comfortably include foreign policy discussions.)
Gore’s effort looks very different to me because he is involved with scientists and other specialists in his efforts. He isn’t all about hiring campaign staff.
I’m a bit mystified about how you all can’t see what a serious challenge this is to the whole idea of any sort of campaign finance reform.
If we are going to have strict disclosure rules for donors, this method can evade them.
If we are going to have public financing, this method can evade the rules about that.
I’m not wedded to the idea that Edwards did anything wrong in a moral sense. I think he should be able to campaign for the whole rest of his life if he wants and that people should be able to fund it if they agree with him. It is core political speech as far as I’m concerned. But this general advocacy/candidate line is going to be impossible to enforce if hiring all your major campaign staff is ok and if its major public function.
And if the general advocacy/candidate line goes, the Constitution dictates that it must go in favor of general advocacy.
We aren’t even having a fight about “did he theoretically hire too many of the officers of the organization from his campaign staff”. You’re arguing that hiring 5 out of 5 officers from the campaign staff is ok. If this is the kind of hair-splitting we can look forward to, it isn’t worth it. Just let campaigns do what they want and be done with it.
You can’t run “Edwards for President” ads, but are we going to have the FEC decide if “Edwards is a man of Presidential Character” is too close to the line? What about posters that say “Come listen an Edwards Speech on Poverty: He has such a vision he seems more Presidential than Bush”. What if ‘Edwards’ and ‘Presidential’ are in huge type when the rest isn’t. What about medium type?
Can’t hire caucus organizers? But he can hire anti-poverty organizers (public benefit) who decide that organizing for a caucus to ‘help’ their great anti-poverty guy is the best way to fight poverty. That won’t be a fun line to police without squelching free speech.
Those examples would be on the other side of the line.
I’ve feel like you’ve made a similar argument before about how if people disagree with you about where courts should draw a line, then it can’t be drawn at all. I don’t tend to find it very persuasive.
So, if I’m understanding you properly now, you’re not committed to the belief that Edwards acted unethically, you’re just arguing that if this sort of thing is allowable under the letter of the law, then campaign finance regulation becomes adminstratively unworkable?
I’m not clear that that follows, but it’s a different argument from the one I thought I was having, and I’d have to think about it.
“This does not appear to me to be improper so long as the activities were also calculated to benefit the public.”
This isn’t the standard at all. It is to formed exclusively for the public benefit and is permitted to incidentally engage in direct candidate-beneficial activity.
“This does not appear to me to be improper so long as the activities were also calculated to benefit the public. Gore gives issue speeches, it’s for the benefit of the public, you can tell because he’s not running for anything; Edwards gives issue speeches, it’s for the benefit of the public even though he’s planning to run for something.”
So in your view it turns 100% on whether or the person is a stated candidate? That is fine, but it makes the rules effectively dead letter.
I think the rules are stupid, so I’m ok with them being dead, but I’m very surprised that I’m the only one who thinks this is a serious challenge to the very idea of campaign finance rules.
So in your view it turns 100% on whether or the person is a stated candidate? That is fine, but it makes the rules effectively dead letter.
I’ll stop repeating myself after this round, because we just aren’t communicating successfully and I’m not sure what I’m doing wrong, but no, that’s not it at all. The point is that if what you’re doing benefits the public, it benefits the public regardless of whether it also benefits a campaign. All the work Gore’s been doing for the last eight years wouldn’t suddenly become not beneficial, or less beneficial, to the public if he announced he was running for President tomorrow. The fact that keeping himself in the public eye would be immensely beneficial to such a Presidential campaign doesn’t affect the public benefit one way or the other.
“Those examples would be on the other side of the line.
I’ve feel like you’ve made a similar argument before about how if people disagree with you about where courts should draw a line, then it can’t be drawn at all. I don’t tend to find it very persuasive.”
We’re having a deeper argument than that. The courts (or in this case much more likely some sort of agency) COULD draw all sorts of lines. But the act of having it do so on a regular basis is chilling for free speech.
If we are going to have to litigate issue ads, that isn’t good for free speech.
If we are going to have to have an election commission deeply inspect every 401(c)(4) with ties to a candidate, that is chilling to free speech and very damaging to the often under-noticed 1st amendment protection of free association.
Look at this case. The publically knowable things look exactly like a campaign. The staff is in fact campaign staff. The transparent expenditures are in fact stump speeches. They also form a vanishing minority of the expenditures. The big expenditures are opaque. They look campaign related (essentially meetings and seminars with the not-yet-declared candidate) but Lizardbreath argues that they could have ‘some’ influence and thus count for public good. These opaque things are meetings and seminars. To police this bar (even as low as Lizardbreath sets the threshold) would require an election commission or election administration inquiry into the purpose and contents of these meetings and seminars. If you get an adverse ruling, you’d have to fight it–which would cost lots of money. That is going to be incredibly chilling on free speech.
And good heavens what if you are an independent group but like someone’s message enough to support a speech tour? If that person becomes a candidate, you certainly don’t want to be dragged into some sort of election commission investigation. It could be ruinous.
But if we don’t police it, you are going to get things exactly like Edwards’. And whether or not this particular case is in fact one of them if you aren’t policing it you will definitely have cases in the future where the actual public benefit is near zero and the majority of the benefit is for the campaign. And that would be the end of your rules.
“The point is that if what you’re doing benefits the public, it benefits the public regardless of whether it also benefits a campaign.”
Ok, then let’s look at it from the other side. What, short of announcing himself a candidate for president, would be clearly impermissible in your mind?
With your very broad definition of the “public benefit” it seems as if anything a candidate believes to be important counts. So what, short of announcing candidacy, isn’t permitted?
Oh, lots of stuff. Travel and speeches focused on swing states, or early primary states; development of voter databases for the exclusive use of the campaign; lobbying for endorsements; the purchase of television or radio ads prominently featuring the candidate — you’re being hyperbolic in saying that the CPO was indistinguishable from a campaign. An active campaign does all sorts of things the CPO wasn’t doing.
“Travel and speeches focused on swing states, or early primary states”
Let’s analyze this under your previous definition. “The point is that if what you’re doing benefits the public, it benefits the public regardless of whether it also benefits a campaign.”
If the speeches in early primary states benefit the public, it benefits the public regardless of whether it benefits a campaign.
If the speeches in swing states benefit the public, it benefits the public regardless of whether it benefits a campaign.
What am I missing here?
“development of voter databases for the exclusive use of the campaign; lobbying for endorsements; the purchase of television or radio ads prominently featuring the candidate”
Voter databases not for exclusive use of the campaign? That should be easy to make look ok.
Lobbying for endorsements is “announcing candidacy” so it isn’t what you were talking about.
Television or radio ads could easily be about the “public benefit” (especially as broadly defined as you are allowing) with the not-yet-a-candidate providing an identifiable voice-over.
If these things benefit the public, your definition says that the benefit to the campaign is irrelevant.
What am I missing here?
That, to invent an example, the incremental benefit to the public from one additional speech to the people of Iowa, after a dozen prior speeches, is so small that it’s negligible, leaving only benefit to the campaign.
I’m not going to successfully develop a complete regulatory system for you in a blog-comments box: it’s not what I do professionally, and even people who do it professionally put more effort into it than I’m going to. I don’t see my failure here (highly though I think of my own capacities), however, as strong evidence that it can’t be done.
“That, to invent an example, the incremental benefit to the public from one additional speech to the people of Iowa, after a dozen prior speeches, is so small that it’s negligible, leaving only benefit to the campaign.”
But that is maybe on speech number 13. What about speech number 12? 11? 10? Surely the first 3 or 4 speeches are fine under your expansive definition of public benefit. Are we going to have an FEC investigation after every speech to ensure that this very speech had ‘enough’ public benefit? How are they going to measure it?
I’m not going to successfully develop a complete regulatory system for you in a blog-comments box: it’s not what I do professionally, and even people who do it professionally put more effort into it than I’m going to. I don’t see my failure here (highly though I think of my own capacities), however, as strong evidence that it can’t be done.
Well, campaign finance reform has been attempted multiple times, and so far as I can tell… we get fights over whether or not hiring your campaign staff as 100% of the officers of the non-profit, having no obvious public benefit (opaque benefits being highly speculative though you seem comfortable assuming them) for 90% of the expenditures, and cutting it off right when the candidate starts his campaign crosses any identifiable line other than “announcing candidacy”.
And the answer, surprisingly to me seems to be, ‘no’.
I’m skeptical of the ability of actual human beings to evaluate such things in a sufficiently non-partisan manner to make the glaringly obvious risk to political free speech and political free association worth putting under constant government scrutiny.
If this Edward’s case doesn’t make you at least a little bit nervous about that, I’m very surprised.
I don’t have strongly held opinions about campaign finance reform — at the treetop level I think there’s too much money in politics, and favor publicly funded elections, but on the specifics I’m not clear what can productively be done about it, and am particularly unclear that there’s anything much to be said for our current system.
I’ve been arguing primarily about what can be said about the ethics of Edwards’ actions given what we actually know, and arguing that the answer is “not much”. But a full scale defense of the non-profit tax code as it interacts with campaign finance law as a good thing is beyond me.
OK, so we have multiple topics here.
1. Did Edwards do something illegal?
For this it appears the answer might come from the Justice Department and perhaps the courts. They could examine the details of what his nonprofit did and decide whether they’re over the line or not. It would be a subtle judgement issue on their part.
2. Did Edwards do something immoral? Should he have given more money to the poor? Should he have decided not to run for office? Should he have officially run for office from 2004 on?
It looks like this will be decided by individual people based on their own criteria.
3. Is there something wrong with campaign finance laws?
The answer is inevitably yes. The fundamental problem is that money is fungible. We might want to try to control who can contibute to a political campaign and how much they can contribute. We can’t really do it, because there are so many ways to have a dollar doing one thing leverage a dollar doing something else. We might want to try to expose who has contributed to a political campaign, and we can’t really do that either for the same reason.
I believe to the extent this problem must be solved, we need to find ways to run effective campaigns very cheaply. If you can be effective without spending much money then it doesn’t as much matter how much money you get secretly.
I think the answer to 1 has to be a strong presumption of ‘no’ in the absence of an investigation or any indication that an investigation is planned. But the rest of your comment works for me.
“They could examine the details of what his nonprofit did and decide whether they’re over the line or not. It would be a subtle judgement issue on their part.”
Sure, but my argument is that it is not good for Consitutionally protected free speech and Constitutionally protected free association for the everybody to be worrying about whether or not that kind of subtle judgment is going to go in their favor.
I wonder if we’ll ever get more data – it would be rather frustrating to be stuck here.
About the foreign policy meetings: Edwards ties foreign policy into his global anti-poverty message in his stump speeches and his campaign’s policy papers. I happen to think his proposals make little coherent sense, but his overarching vision does genuinely attempt to connect FP and his domestic poliy agenda. In other words: I don’t think that’s a damning piece of evidence against his organisation.
“I wonder if we’ll ever get more data – it would be rather frustrating to be stuck here.”
I’d be shocked if we get much more data. The penalty for failing to file a 2006 tax report for instance isn’t much of a threat against a now-defunct non profit. So I doubt we’ll be seeing that.
Edwards clearly isn’t saying anything in response. So that leaves us with pretty much nothing until maybe the actual presidential election season if he is the candidate.
“I happen to think his proposals make little coherent sense”
This is what I mean about lack of fair enforceability. The foreign policy aspects of domestic poverty prevention aren’t likely to be useful for the “public good”. But who the heck is going to be looking in to that? And who do we trust to make a fair judgment about it? It is a such a politically charged thing that you’re going to hit up against the 1st amendment in no time.
“everybody to be worrying about whether or not that kind of subtle judgment is going to go in their favor”
IANAL question – isn’t this a general problem with law? AFAICT almost anything that makes it to the SCOTUS is messy and subtle and gets decided by ideology or whatever happens to be the prevailing judicial philosophy.
“And who do we trust to make a fair judgment about it?”
Judges? The courts and legislatures? You mean “hard cases make bad law”?
“IANAL question – isn’t this a general problem with law? AFAICT almost anything that makes it to the SCOTUS is messy and subtle and gets decided by ideology or whatever happens to be the prevailing judicial philosophy.”
It is why the Supreme Court has pretty much abandoned obscenity jurisprudence–the call is just too difficult to make fairly, and it needs to be predictable or people will be chilled.
I mention obscenity because it is a free speech issue, but is on the edges of the free speech value, as opposed to political speech which is the core of the free speech value. If the court thinks that such fine judgments are pretty much too difficult for obscenity I can’t imagine how it thinks that subjecting everyone to that in the core of the value would be ok.
I would however guess that the value to society of obscenity decisions is generally evaluated as very low.
I thought the conservative stance on these questions was, The legislatures should write clear laws.
“I would however guess that the value to society of obscenity decisions is generally evaluated as very low.”
You have this phrased like disagreement but I don’t understand. Political speech is the core value in free speech. If values on the border, like obscenity, are almost impossible to fair adjudicate, that argument is MUCH more true of political speech.
“I thought the conservative stance on these questions was, The legislatures should write clear laws.”
If it is possible. I don’t think it is possible in this case to have a law that is A) clear, B) actually restricts political speech, and C) doesn’t run afoul of the 1st Amendment protections of free speech, press and association.
I think you could have a clear law that doesn’t restrict anything, but that doesn’t exactly address the concerns of those who advocate campaign finance restrictions.
“You have this phrased like disagreement but I don’t understand.”
I meant, obscenity may be difficult to describe but it’s hardly worth the trouble to do so. Decisions about political speech may be difficult but the inherent questions are vital to our society, so the court has less motivation to ignore them.
“I don’t think it is possible in this case to have a law”
Here we are so far outside my limited competency that I’ll bow out.
Good discussion, everybody, thanks.
Re: Thoughts on John Edwards?
I used to be impressed by him years ago, but lately the guy strikes me as …