Ohio GOP Leaders’ Push to Stop Foreign Money Does Nothing About Transparency

In exchange for putting a sitting president on the state ballot, Ohio’s Republican leadership this week demanded that Democrats agree to a measure Republicans said would protect ballot initiatives from foreign money.

However, the measures would do nothing to bring transparency to politically active 501(c)(4) “dark money” groups into which foreigners, corporations — even criminal organizations — can contribute unlimited cash without the general public being any the wiser. 

Two such organizations — one of which was founded by a future aide to Gov. Mike DeWine — funded the biggest bribery scandal in Ohio history. And many of the same politicians who now are warning of foreign money are ducking questions about massive support they received from those groups and company that funded them as they took actions that helped further the company’s interests.

Presidential problem

The Democratic National Convention this year falls on Aug. 19, which is after Ohio’s Aug. 7 ballot certification deadline. Legislation was needed to move back that deadline if millions of Ohio voters were to be able to cast a ballot for the candidate of their choice. 

It’s a problem previous legislatures fixed for both parties as a matter of routine. But this year’s Republican supermajorities demanded a quid pro quo if President Biden was to appear on the Ohio ballot. 

Republicans are coming off of heavy defeats last year in attempts to make it much harder for voters to initiate constitutional amendments and to block an amendment protecting abortions rights. Now Ohio Republicans wanted to use the ballot fix to again attempt to change rules surrounding ballot initiatives. 

Legislative Democrats declined to go along, and after a lengthy stalemate, Gov. DeWine on Thursday stepped in and said he was calling the General Assembly into special session. 

The legislature can only consider matters the governor puts on the “call” for a special session, but DeWine didn’t limit himself to a “clean” call that would have only allowed members to put the sitting president on the state ballot. He also allowed it to consider laws changing the way ballot initiatives are financed.

On Tuesday, the Democratic National Committee appeared to eliminate the need for any special session by announcing that it would meet virtually before the Ohio deadline and officially nominate Biden. But the session went ahead on Wednesday anyway. 

DeWine Press Secretary Dan Tierney denied that his boss used the Biden-ballot controversy as a trojan horse to sneak in unrelated legislation.

“The General Assembly had gone weeks without passing a fix to get the President on the ballot; it would have been foolish to limit the options for the General Assembly to get this done,” he said in an email.

Foreign funding

The purpose of the unrelated measures, their Republican supporters say, is to ensure that foreign dollars aren’t driving voter-initiated ballot initiatives.

“Unfortunately, it has become increasingly evident that decisions intended to be made by Ohioans are being unduly influenced by foreign governments, pouring millions of dollars into our state,” Lt. Gov. Jon Husted said in a statement posted to social media Tuesday. “To prevent foreign interests from manipulating our government for their own sinister agendas, foreign money must be barred from Ohio elections.”

It may prove difficult for lawmakers to agree on anything in the remaining hours of the session. Republican leaders in the Senate and the House couldn’t even agree Tuesday on the order in which the bills must proceed through the two houses, or the numbers they should have.

As to their merits, several observers expressed skepticism that the real motivation was keeping outside money from infiltrating Ohio politics. 

Last year, Secretary of State Frank LaRose said it was important to harshly limit citizens’ ability to amend the state Constitution to protect against out-of-state interests. Meanwhile, his side of the fight was heavily funded by an out-of-state billionaire who also happened to be a prominent election denier.

Another reason for skepticism, said Common Cause of Ohio Executive Director Catherine Turcer, is the timing. If the bills being pushed in a special session ostensibly about putting Biden on the ballot are so all-fired important, why weren’t they passed by the supermajorities in a regular session?

“Why is this legislation such a priority now?” she asked.

Tierney, DeWine’s press secretary, said the mere fact that Democrats and others are opposing the legislation is proof that it’s needed — and now.

“… the behavior of opponents of the ban since the Governor’s announcement seems to indicate there indeed is foreign influence in these ballot initiatives and that some issue groups are counting on that support as part of their plans to campaign for or against these issues; the outcry would not make sense otherwise,” he said. “The statements and conduct of those opposing a ban have made it more clear to the Governor that such a ban is needed right away.”

Imposing burdens

Among the measures being debated are requirements that groups supporting state and local initiatives form political action committees — a move that University of Cincinnati political scientist David Niven said would be “a massive imposition for what can be very humble ballot questions.”

If enacted, at least some of the proposals would take effect prior to the November election, when a constitutional amendment meant to address Ohio’s extreme gerrymandering is expected to be on the ballot. Just as LaRose’s measure last year was meant in part to stop abortion-rights and anti-gerrymandering amendments, there’s suspicion that some of the measures currently under debate are meant to stop this year’s gerrymandering measure.

Niven said it’s a bigger deal than that.

“It’s certainly an anti-citizens’-voice effort,” he said. “And I think its consequences would be far grander than making it marginally harder (to put on the ballot and pass the anti-gerrymandering) amendment. It’s creating campaign-finance requirements that would burden every ballot question from top to bottom no matter how obscure — even things Republicans wouldn’t object to.”

LaRose, the secretary of state, routinely ignores questions about his official actions and public statements — as he did for this story. But in a May 9 press release calling to “ban foreign influence over Ohio’s elections,” he gave a hint of what he is trying to stop.

It cited a press report saying that nearly $7 million to support the abortion-rights amendment came from the Washington, D.C.-based Sixteen Thirty Fund, which promotes causes such as voting access and the League of Conservation Voters. The fund counts among its more than 500 contributors Hansjörg Wyss, a Swiss billionaire, who has contributed more than $200 million since 2016, the press release said.

If, as Husted said, such groups are “manipulating our government for their own sinister agendas,” Ohio voters of both parties apparently agreed with that of the Sixteen Thirty Fund. The abortion-rights amendment passed by a 14-point margin.

Turcer, of Common Cause, said lots of organizations might find themselves similarly situated as the fund — including ones aligned with LaRose.

“There is a public good in keeping foreign money out of Ohio elections,” she said. “But that’s already prohibited through the rules of the Ohio Elections Commission.”

She added, “The problem is in the enforcement mechanism. This becomes complicated. Corporations can spend money in a ballot campaign. Let’s take British Petroleum. A good chunk of their money is from out of the United States. Or if the Catholic Church is involved to fight a pro-choice issue, is it possible that some of that money is from Canada or Mexico? There can be a prohibition, but it gets complicated really fast.”

The undisclosed elephant in the room

Turcer was also frustrated that even after the biggest bribery and money laundering scandal in state history, the state’s Republican leaders have done nothing to bring transparency to the kind of entity that funded it — 501(c)(4) “dark money” organizations.

Such groups — which include the Sixteen Thirty Fund — don’t have to name their donors. They’re used by Republicans and Democrats to support political causes and their use has expanded wildly after the 2010 U.S. Supreme Court ruling in Citizens United v FEC.

It said that corporations could make unlimited political donations. The only limitation was that the cash had to go to outside groups that weren’t allowed to coordinate their activities with campaigns.

Then-President Barack Obama predicted it would lead to abuses, and starting in 2017 in Ohio, dark money fueled a massive abuse. For all the public knew, Vladimir Putin could have been pumping money into an epic effort to pass and protect a $1.3 billion nuclear bailout that mostly benefited Akron-based FirstEnergy.

But in July 202o, the FBI arrested then-House Speaker Larry Householder, former Ohio GOP Chairman Matt Borges and three others — and the public got a clearer picture of the  money’s origins. The feds had used subpoenas, wiretaps, undercover agents and other means the rest of us don’t have to determine that FirstEnergy itself paid more than $60 million to finance the effort.

Ironically, that money was used to erect a foreign boogeyman of its own. Supporters of the bailout spent $36 million fighting its repeal, and some of that money financed TV ads falsely claiming that the repeal was China’s attempt to take over the Ohio power grid.

Sunlight

At the time of Householder’s arrest, DeWine, Husted, Yost and LaRose each had long-standing ties to FirstEnergy, each received financial support from the company, each played roles in passing the the bailout or stopping the citizen-initiated repeal, and each was mentioned multiple times in Householder’s trial — which netted him a 20-year prison sentence.

However, they’ve refused to answer important questions about their involvement. For example, DeWine said he didn’t know about millions in dark money FirstEnergy spent supporting his 2018 campaign, while Husted has refused to talk about the $1 million the company spent supporting his.

Turcer said that if the state’s leaders really were concerned about Ohio politics being polluted with money of unknown, criminal or foreign origins, they’d work to bring transparency to the dark money flooding the state.

“The thing that’s really irritating is that it’s been nearly four years since Larry Householder was arrested,” she said. “It is very clear to the state legislature what happens when you don’t have greater transparency and you let all sorts of things flourish in a dark money system. They have not taken action for years. Why haven’t they?”

Asked about this, Tierney, DeWine’s press secretary, said there could be constitutional problems.

He said the governor “would certainly entertain transparency reforms in this area if the General Assembly were to pass such a bill. The Governor has noted, however, that many proposals floated by advocates could conflict with United State Supreme Court caselaw and that the difficulty is indeed crafting a proposal that complies with the standing precedents.”

However, states such as Arizona have passed laws requiring that 501(c)(4)s that spend a certain amount on political campaigns disclose their donors. In February, a state judge dismissed a second attempt to strike down the law.

There’s also the fact that in writing the Supreme Court opinion allowing unlimited corporate money in American politics, then-Justice Anthony Kennedy stressed the importance of transparency.

“The First Amendment protects political speech; and disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way,” he wrote. “This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.”

Niven, the political scientist, said that for Ohio Republicans, bringing transparency to dark money is just a bridge too far.

“There’s a very good reason why (the measures proposed in the special session) do nothing to dark money groups,” he said. “Dark money groups are the lifeline to the Republican bacchanalia here. They can’t cut that off.”

Originally published by the Ohio Capital Journal. Republished here with permission.