Thanks, Amazon, for delivering us a good reason to finally regulate Super PAC donations.
Thanks, Amazon, for delivering us a good reason to finally regulate super PAC donations. HADRIAN / SHUTTERSTOCK.COM

When Amazon announced last week that it would drop an additional $1 million on a local super PAC working in this year's city council elections, the news shook Seattle.

The online retail giant's unprecedented attempt to buy support for its slate of Amazon-approved candidates surprised local political consultants accustomed to all kinds of electioneering attempts. The contribution made the New York Times, and Elizabeth Warren even weighed in.

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The donation, which brings Amazon's total spending in this year's city council elections to $1.5 million, also raised an existential question for this city: How corrupt do our elections need to appear before we do something about regulating them?

These sorts of massively outsized donations—Amazon has now spent more to elect its seven preferred city council candidates than the entire slate of opposing candidates has raised collectively—are only growing more frequent.

Out-of-state unions are joining the tech giant and throwing hundreds of thousands of dollars into Seattle’s municipal elections. All of which is revealing a raw electoral reality: When it comes to election spending, the rich and powerful are only limited by how much they want to spend.

So Seattle is needs to decide: At what point do we need to limit the amount of money ultra-wealthy people can spend in our elections?

Because there’s already a proposed law that would do this very thing.

Seattle City Council member Lorena Gonzalez has floated legislation that would severely curtail the ability of rich people and companies to limitlessly fund super PACs. Gonzalez’s legislation would limit super PAC donations to $5,000 and block multinational companies such as Amazon from spending any money at all in our local elections.

Gonzalez’s proposal has been quickly dismissed by the local political establishment because it would likely face legal challenges. And the Supreme Court’s 2010 Citizens United ruling seems to make it impossible to place limits on super PACs. But a close reading of the law shows that’s actually not the case.

For reasons explained later in this post, Gonzalez’s law actually has a real shot at passing constitutional muster, in part because of the very action Amazon’s executives are taking in this year's election.


The Appearance of Corruption

Over the course of 2019, it's become crystal clear that Amazon’s executives are not only directing their corporate money to a super PAC that supports Amazon-preferred candidates, they are also donating directly to candidates themselves.

Constitutional law scholars argue that this kind of donation activity, which gives off the appearance of a coordinated attempt to exceed individual contribution limits, could actually provide a legal basis for regulating donations to super PACs.

The Supreme Court has consistently ruled that the government can regulate donations to prevent the “appearance of corruption” in elections.

We don’t need to wait until someone proves that these massive donations are actually creating corruption—the mere appearance of corruption is enough.

Maintaining faith in democratic elections, the Supreme Court has held, is reason enough to regulate donations.

So the operative question right now in Seattle is this: How corrupt do Amazon's donations make our elections appear?

It’s not hard to lose faith in Seattle’s elections when donations for individuals are legally capped at $500, but Amazon executives are able to give the maximum individually and, it seems, direct millions of dollars more in Amazon corporate support of their favorite candidates.


How Amazon Executives Get Around Contribution Limits

Consider Seattleite David Zapolsky. He's a fan of Seattle City Council candidate Egan Orion, so he gave the District 3 candidate $500—the maximum amount one person is allowed to donate directly to any candidate under city law.

But Zapolsky is no regular Seattleite. He’s Amazon’s top corporate attorney and a member of Amazon CEO Jeff Bezos’s elite “S-Team.”

So why should Zapolsky stop at the legal $500 direct contribution limit?

After giving $500 to Orion, Zapolsky went on to personally funnel $10,000 of his own money to a local super PAC called People for Seattle, which has now spent $55,663 supporting Orion and $12,517 attacking Orion’s opponent, Council Member Kshama Sawant.

And then there are Amazon’s corporate donations, which total $1.5 million and were entirely directed to the Seattle Metropolitan Chamber of Commerce’s super PAC, which is known as Citizens for a Sound Economy (CASE).

CASE has spent $324,643 supporting Orion.

Zapolsky and Amazon both declined to comment for this story. They would not answer Stranger questions about whether Zapolsky was involved in deciding on or directing Amazon's corporate donations. But it’s not hard to image that Zapolsky, as a member of Bezos's "S-Team," has been at least somewhat involved in Amazon’s decision to donate to CASE.

If he was, that would mean that Zapolsky was able to max out to Orion's campaign as an individual $500 donor, support the Orion-backing People for Seattle PAC to the tune of $10,000, and help steer $1.5 million in Amazon money to the Orion-backing CASE PAC.

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That's a grand total to $1,510,500—more than 3,000 times what any individual donor in Seattle is allowed to give the Orion campaign.

Even if we pull back on this hand-of-Zapolsky theory a little and assume he had nothing to do with Amazon’s corporate donation to the CASE PAC, his personal donation to the People for Seattle PAC still shows that he's able to support his favorite candidate well over the $500 direct donation limit.

Zapolsky is not the only Amazon executive using super PACs to support candidates over the legal direct donation limit.

Ten of Amazon’s “S-Team” executives have personally donated $48,975 to local political campaigns this year. Most of that money—$41,500—has gone to People for Seattle (PFS), the preferred super PAC for Amazon executives.

PFS is supporting the same slate of candidates supported by CASE, which is the super PAC that received $1.5 million from Amazon corporate. Of the remaining “S-Team” donation money, $4,475 went directly to Orion as six of the team's executives maxed out their donations to the District 3 candidate.


A Tried and True Formula for Election Manipulation

This method of using super PACs to support candidates beyond direct donation limits is hardly unique to Seattle. It’s now the standard electioneering method for wealthy individuals across the country and from both parties.

To take just one well-known example: In 2014, Trump-backing billionaire Robert Mercer gave the federal limit ($2,800 per election per candidate) to 37 different federal candidates.

But then Mercer also bankrolled a super PAC that spent $16.6 million on those same 37 candidates, according to a study from campaign researcher Stephen Weissman.

Zapolsky and Mercer’s ability to get around contribution limits by sending massive amounts of money to their favored candidates through super PACs threatens the very foundation of American campaign finance policy, according to Weissman.

“These unlimited donations intensify the dangers of quid pro quo corruption and its appearance that contribution limits were established to prevent,” Weissman wrote in his 2016 study.

Put plainly, these massive coordinate donations are making American elections look corrupt.


A New Solution

But as Seattle sees a record amount of super PAC donations this year—super PACS have already spent more than $3 million to influence our current elections; four years ago they raised only $1.6 million total—this growing appearance of corruption might make Seattle ground zero for finally reining in the consequences of Citizens United.

As mentioned, Seattle City Council member Lorena Gonzalez is proposing a new law that would limit local super PAC donations to just $5,000.

That limit would almost certainly be challenged in the courts by wealthy people who want to keep bombarding American elections with no-limits campaign cash. But the Amazon executives’ double-dipping donations in this year's elections, and others like them, may give the law a leg to stand on in court.

The Supreme Court has routinely held that the government can limit campaign donations (a campaign’s own expenditures are a different story) in the interest of stopping the “appearance of corruption.”

That’s the very reason all elections in America have donation limits to begin with—if a single individual could give $1,000,000 to their favorite candidate running for election, that election would appear corrupt. So the courts have given us the right to limit direct donations, not because big donations are necessarily a form of quid pro quo corruption, but simply because massive donations create the appearance of a corrupt election.

So the constitutional question to ask is not whether Orion is being corrupted by his Amazon supporters' donations, but whether these massive Amazon donations appear corrupt to the voters.

And the brazenness of these Amazon executives’ attempts to influence this year's city council elections may force the city to answer that question in court.


Why the Appearance of Corruption Matters, Legally Speaking

To understand American campaign finance laws and the legal basis for them, one must begin back in 1974, when the Supreme Court ruled on a challenge to what was, at the time, the country’s most ambitious campaign finance law.

Before the 1970s, campaign finance was sparsely regulated in the United States, with essentially no limits on donations, expenditures, or even reporting requirements for those who gave to campaigns.

That changed in 1971, in the midst of the Richard Nixon presidency, when Congress passed the Federal Election Campaign Act. That law created strict donor contribution limits and donor disclosure requirements. It also created dollar limits for how much candidates, donors, and independent expenditure groups could spend during an election. In 1974, the act was amended to create the Federal Election Commission.

Opponents of the law argued that the act violated their First Amendment rights to free speech and, in the 1976 landmark case, Buckley v. Valeo, the Supreme Court largely agreed.

The court ruled that limiting how much any candidate or a group could spend on a campaign infringed on their guaranteed freedom of speech.

That left campaigns able to spend however much money they could raise.

The court did not, however, say that donors could give unlimited amounts of money to campaigns.

Rather, the court upheld the law’s donation limits, ruling that a political donation does not have the same First Amendment free speech protections as an expenditure. The justices also said that the government has a right to limit donations in part because large donations lead to the possibility of real and perceived corruption.

“Of almost equal concern as the danger of actual quid pro quo arrangements is the impact of the appearance of corruption stemming from public awareness of the opportunities for abuse inherent in a regime of large individual financial contributions,” the court wrote. [Emphasis added.]

The court decided that maintaining the appearances of honest elections was nearly as important as preventing actual corruption. Our democracy depends on the electorate’s trust in elections, and therefore, the court argued, the government is well justified in regulating donations to prevent the impression of corruption that extremely large donations can create.

After Buckley v. Valeo, rich people who wanted the ability to give unlimited sums of money in support of candidates were blocked from doing so. That is, until 40 years later, when, in the winter of 2010, the country’s highest court issued a new opinion that fundamentally changed how American elections operate—and, in the process, created ample opportunity for the possible appearance of corruption.


Citizens United and the Modern Super PAC

The Supreme Court was clear in 1976 that it didn’t like the government placing limits on what campaigns can spend, but that didn’t stop Congress from enacting a new round of expenditure limits in 2002’s Bipartisan Campaign Reform Act.

This time, Congress took aim at money that was flowing into elections but wasn’t directly going to campaigns.

These funds mostly took the form of so-called “soft money” being sent to organizations that weren’t officially campaigns, but still issued ads during elections. The law, often referred to as the McCain-Feingold Act because of its two primary proponents, banned all spending on election communication by these non-campaign groups within 30 days of any election.

This law was naturally challenged, and the Supreme Court decided somewhat predictably (remember, the court doesn’t like political expenditure limits), in a case called Citizens United v. FEC, that the law was an unconstitutional limit on free speech.

Citizens United blocked expenditure limits for non-campaign groups but it didn’t say anything about donations to those groups.

It wasn’t until later that year, when a lower court interpreted a few words from the Citizens United ruling in a new case, called SpeechNow.org v. FEC, that contribution limits to non-campaign groups were struck down and the door was opened for massive donations to flow into a new type of political action committee, the so-called super PAC.

In the SpeechNow.org ruling, the DC Court of Appeals took one line out of the Citizens United case—a line in which the Supreme Court said expenditures by independent groups didn’t create a significant enough risk of corruption, or the appearance of corruption, to satisfy limits on free speech—and applied it more broadly, not just to expenditures by independent groups, but also to donations to those groups.

“In light of the Court’s holding as a matter of law that independent expenditures do not corrupt or create the appearance of quid pro quo corruption, contributions to groups that make only independent expenditures also cannot corrupt or create the appearance of corruption,” the SpeechNow.org ruling reads.

The SpeechNow.org ruling was referenced a few months later in a separate court case in California called Long Beach Area Chamber of Commerce PAC v. City of Long Beach.

In that case, the city of Long Beach had set a strict limit on donations to and expenditures by independent groups like the local chamber’s PAC. The court in this case, now the Ninth Circuit Court of Appeals, which Seattle sits inside, picked up on the rationale in the SpeechNow ruling to also rule that the Long Beach law was an unconstitutional limit on freedom of speech.

With these two rulings, the stage was set for the growth of American super PACs. Wealthy donors, corporations, and labor unions were now free to donate as much as they wanted to PACs, which could in turn spend without any limits, provided those PACs did not directly coordinate with the candidates they supported.

In 2009, the year before these super-PAC-enabling rulings were decided, Seattle’s election watchdog tracked zero dollars spent on independent expenditure groups.

By 2015, that number had grown to $1.6 million.

In this year’s election, independent expenditure groups have already spent more than $3 million.


Can Gonzalez Stop the Super PAC?

Amazon’s latest donation caught the attention of people far from Seattle. That's how powerful this city's super PACs have become.

But just as super PACs boom in Seattle’s elections, there might be a movement to seriously reduce their strength. Council Member Lorena Gonzalez's proposed a law would limit donations to super PACs to only $5,000 and stop multinational companies from spending in Seattle elections at all, a serious curtailment on the effectiveness of these groups.

For example, Zapolsky has given $10,000 to a People for Seattle PAC and his employer has given $1.5 million to the CASE PAC.

If Gonzalez’s legislation were law, Zapolsky would have been limited to $5,000 to People for Seattle. In addition, his employer—which is publicly traded and has an ownership structure in which more than 5 percent of its owners are not US citizens—would be blocked from spending entirely.

The law would likely be challenged in court, and the city would need to convince a judge that they have a compelling interest in regulating super PAC donations. But Albert W. Alschuler, a professor at the University of Chicago School of Law, thinks Gonzalez’s proposed law could survive a court challenge.

“Approving a Seattle ordinance to restrict contributions to super PACs could give the Supreme Court an opportunity to rule on an important, unsettled question of constitutional law,” Alschuler said in a letter filed in support of the ordinance. “SpeechNow was wrongly decided, and I believe that the Supreme Court is likely to say so if a way can be found to present the issue to the court.”

Alschuler said there are already grounds for regulating donations to groups not directly affiliated with politicians. “Courts have repeatedly held, for example, that a contribution to a public official’s favorite charity can be a bribe…” Alschuler wrote. Perhaps the same logic could be applied to super PACs favoring a particular politician.

Weissman, the researcher who studied these super PAC donations on a federal level in his report, “The SpeechNow Case and the Real World of Campaign Finance,” said that coordination between major donors who are giving directly to candidates and then also spending heavily on super PACs that also support those same candidates is grounds for increased regulation of donations.

“When donors amplify their legally limited direct contributions to candidates with unlimited indirect support via independent spending groups, an 'anti-corruption interest in limiting contributions to an independent expenditure group' certainly arises,” Weissman said in his report. “These unlimited donations intensify the dangers of quid pro quo corruption and its appearance that contribution limits were established to prevent.”

Gonzalez’s first step in introducing this legislation was taking it to a meeting of the Seattle Ethics and Elections Commission (SEEC) to hear their opinion. The commissioners ultimately didn’t issue an opinion on the law, and it’s currently unclear whether they will officially endorse the proposal, according to SEEC executive director Wayne Barnett. But the commissioners seemed open to the idea.

Brendan Donckers, the chair of the SEEC and a local attorney, said at the meeting that he thought the SpeechNow ruling's claim that super PAC donations could never be corrupting was unusually broad.

“It’s rare where you have such categorical opinions from a circuit court saying, we must conclude that the government has no anti-corruption interest in limiting contributions to an independent expenditure group,” Donckers said. “I feel that doesn’t pass the… basic test of being believable. From what folks have seen anecdotally and described in the record, it’s very clear that there is at least the potential for [super PACs] to create corruption risks.”

The state’s Public Disclosure Commission (PDC), which regulates statewide election regulations, has already announced their support for Gonzalez’s proposed law.

Donckers went on to say that these super PACs appear to be undermining the very ability for Seattle to regulate its own elections.

“Our commission is tasked with protecting transparency and ensuring accountability, and PACs seem to be an end-run around that,” Donckers said.

Which brings us back to Zapolsky and his fellow executives at Amazon.

The question, in the end, is whether or not Seattle should tolerate this kind of electioneering.

Or to use the language of Supreme Court precedent: Is there an “appearance of corruption” when Seattle donors are only able to send $500 directly to any one candidate, but some wealthy Seattle donors are also able to freely donate thousands or millions of dollars more to a super PAC, which then spends the money helping that same candidate?

Seattle may soon find out.