Thursday, April 29, 2010

CCA reinstates money laundering case against DeLay associates

In a bit of a Man Bites Dog episode, the Texas Court of Criminal Appeals unanimously decided yesterday to uphold the state's election laws banning corporate donations in elections. Reports Chuck Lindell at the Austin Statesman:

The Austin appeals court erred in deciding that the state’s money-laundering statute - used to prosecute associates of former U.S. House Majority Leader Tom DeLay - did not apply to transfers made via checks, the Texas Court of Criminal Appeals ruled today.

The court’s 9-0 decision also upheld the state’s election laws prohibiting corporations from making political contributions to candidates. DeLay’s associates - John Colyandro and Jim Ellis - had challenged the law as an unconstitutional infringement on First Amendment rights.

In 2002, the Public Integrity Section of the Travis County District charged Colyandro - working on behalf of Texans for a Republican Majority PAC - with accepting political contributions from corporations.

Colyandro and Ellis also were charged with money laundering by transferring $190,000 in corporate contributions to the Republican National Committee by a check, with a similar amount later returned to the state organization.

Several surprising things about this. The CCA has recently been a sharply divided court and it's notable to see a 9-0 vote on what's been a contentious, partisan case dragging out many years. Also, the ruling serves as vindication to a degree of former Travis County DA Ronnie Earle who pushed for these charges back in 2002 and was widely criticized with the 3rd Court of Appeals ruled against them. It's particularly ironic that Sharon Keller would write an opinion serving that function.

As for me, I don't particularly know how I feel about this law. I tend to fall on the money-is-speech end of the spectrum on campaign finance debates and personally have never seen a campaign-finance reform plan that didn't cause more problems than it solved. OTOH, in this case the question is that campaign operatives apparently knew what the law was - which agree or not they're obligated to obey - and actively took steps to circumvent it, so I get why they're being prosecuted. And saying checks didn't count as contributions was a slender reed indeed on which to throw out the case.

It'd be fascinating to know the behind-the-scenes politicking among CCA judges that explains how that 9-0 vote came to pass - who initially stood where, what the disagreements were, if any, and what compromises were made to achieve unanimity. I'll bet there's an interesting story to tell about how that result came about.


Michael said...

Scott, do you believe corporations are persons? That's not a rhetorical or frivolous question. The First Amendment does not prohibit Texas from passing any laws restricting free speech; it only applies to the federal government, just like all the guarantees contained in the Bill of Rights. Our free speech rights are protected from state interference by the Fourteenth Amendment Due Process Clause -- but it only applies to persons, not corporations.

That is, of course, until the Supreme Court assumed without deciding that corporations are citizens in the 19th century case Santa Clara County v. Southern Pacific Railroad. This case's central proposition is the ridiculous position that the drafters of the Fourteenth Amendment were trying to protect corporations, not freed slaves. This case is an abomination, and 125 years is not too late to overrule it at the Supreme Court's first opportunity.

So believing money is speech -- which I also think is wrong -- is one thing. But you also have to believe a corporation has constitutional rights. And it helps to believe that night is day.

Gritsforbreakfast said...

"do you believe corporations are persons?"

Certainly they're groups of people, and the First Amendment also extends to freedom of association, etc..

ckikerintulia said...

Grits, the problem IMO with money as speech is that it gives a much louder voice to those with money. Instead of one person one vote, its a million dollars a million votes. It undermines participatory democracy.

Gritsforbreakfast said...

But in elections, Charles, communicating with voters costs money and limiting contributions in practice only means the public hears less debate and votes out of ignorance, which is partly why voter participation is often low.

I understand the harms campaign finance reform wants to remedy, I just think the cure is worse than the disease.

ckikerintulia said...

A corporation is hardly a free association of individuals. I own stock in several, via mutual funds and retirment accounts. But I don't really have a voice in how, for example, American Century Investments conducts its day to day business. I did receive a proxy notice which I finally signed, after much urging from the company. I could have just abstained, or attended their meeting which was not really feasible and would not have been effective. Bottom line is I don't feel I'm really a part of a free association of individuals. I'm not complaining about ACI or Ministers and Missionaries Benefit Board of American Baptist Churches. They have done as well as or better than could be expected in the 2008-09 financial meltdown. But I don't feel I really have a voice in either organization.

ckikerintulia said...

Grits, I think we're going to amicably disagree on this one.

Gritsforbreakfast said...

"I don't really have a voice in how, for example, American Century Investments conducts its day to day business."

However, those who do are actual human beings. Companies are not run by automation.

gravyrug said...

The individuals making up a corporation are persons, and have the ability to contribute to political campaigns as such. Why should they get the opportunity to contribute again as a corporate person?

Gritsforbreakfast said...

Well, gravyrug, most campaign finance reform advocates also support limiting how much they can give as individuals.

Again, I'm not saying there's no harm, just that every solution I've ever seen enacted worked worse than the status quo. Austin's city races are a great example of a completely dysfunctional finance system that makes elections a bad joke where uninformed voters choose between candidates they know nothing about.

Michael said...

Scott, again, First Amendment protections do not restrict the states; Fourteenth Amendment protections do. Specific Bill of Rights protections only restrict states if they protect a liberty interest within the "life, liberty, and property" clause. The restriction is not absolute, but requires that the deprivation of that right must be subject to due process of law.

Do you think corporations want to increase voter debate and lessen ignorance? Corporations want to get their laws passed and their advocates elected! They exist to make money, not to advance society. ckikerintulia's points are very well taken.

Gritsforbreakfast said...

Setting aside the constitutional arguments, Michael, campaign finance reform laws just don't work. They inevitably worsen the problems they aim to solve. I've never seen nor heard of a law that worked well and didn't have severe unintended consequences.

Also, corporations have varying, often competing interests. They're not a monolith. Oil companies and wind power companies may have diametrically opposed agendas. And to say corporations don't "advance society" ignores 20th century history from Ford to Google. It's just not true.

As mentioned, most campaign finance reform advocates also don't want corporate officers to be able to give however much they want as individuals, so it's really about limiting spending, not the corporation vs. person distinction. Reducing money in campaigns as a practical matter reduces communications with voters, and IMO we need more of that, not less.

Anonymous said...

I would propose that more speech equals greater opportunity for the voter to be informed. However....

If I propose a suggestion for how such and such should be handled by the elected individual and another speaker who has contributed orders of magnitude more to the campaign tha I have proposes an opposing viewpoint to the same issue, I believe that most of the elected would be swayed more by the larger donor.

Having said that, I fundamentally agree with Grits. Especially about the law of unintended consequences.