>> you said congress needs to act. what do they need congress to do? >> the administration is hoping that congress will take the idea proposed by the president during the state of the union to have millions of homeowners who are currently paying mortgages on time refinance and ticket bondage of historically low rent -- lending rates. to see if that is a practical solution.

>> what happens from there? if he comes back and says, no, we will not go that route. >> the secretary did not want to prejudge. he took a middle of the road response. right now, it is just wait and see. >> the $25 billion mortgage settlement, what does that do for consumers? cut the fact that it was talked about for so long fed into the hopes -- it is a lot of money, but when you're talking about $700 billion of mortgages under water, it is a drop in the bucket. i do not think it is a cure all or a silver bullet. we will not see one that will help with the margins.

i do not think it is a game changer. tonight, the u.s. senate youth program. >> one of the greatest experiences when i got the opportunity to meet both of my senators. just being able to meet them. >> he talked about how a important is to be financially sound. if we are not financially sound, devoting money to national defence will be worthless. >> high-school students from all 50 states participated in a week-long government and leadership program in the nation's capital. they shared their observations and experiences as the interacted with members of congress, the supreme court, and the president. >> there is a -- i am the one

reaching across the aisle. everyone has said that. it makes me wonder everybody is saying that, but it is not happening. is there a discrepancy between what they are saying and what they are actually doing? >> tonight at 8:00 on c-span. >> with campaign spending by super pacs on the rise, senate democrats introduced a bill called the disclosed act. corporations and unions could spend unlimited funds on election activities. the bill would require all organizations to spend more -- who spent more than $10,000 to publicly name all donors who contributed $10,000 or more. it would require any television or radio ad to list the sponsoring groups top finders.

the senate rules committee met for an hour and a half to discuss the legislation. it would have increased transparency by requiring full disclosure of the real sources of money behind political advertising. the house passed it, the president was ready to sign it, but in the senate, it failed to get cloture by one vote. the problem is the longer hypothetical. the public is living with the aftermath of the citizens -- the

events of the 2010 election cycle and what we have seen so far have confirmed our worst fears about the impact of citizens united and subsequent court decisions. two years ago, we were warned about these harmful a facts, but the results are even worse than expected. just this morning, we woke up to the breaking story reported by bloomberg news that major corporations gave millions to groups who ran attack ads in the 2010 elections and no one knew about it until now. that means voters were left totally in the dark about who paid for the attack ads hitting the airwaves. the trend is disturbing, according to the center of response -- responsive politics, the percentage of campaign spending from groups to do not have to disclose their donors rose from 1% in 2006 to

47% in 2010. we can only imagine by what percentage it will grow by the end of 2012. almost certainly over 50. half the ads have no disclosure. that is incredible and awful. the money is coming overwhelmingly from the wealthiest americans. a recent study in politico fell the 93% of the money contributed to individuals came in contributions of $10,000 or more. here is the most astounding thing about the study. half of that money came from just 37 donors. half of the money in the super pac came from 37 donors. is that democracy? even more worrisome, we are seeing contributions to super pacs from nonprofit

organizations. some of these groups are nothing more than a post office box in the middle of an office park. by now it should be clear to everyone that better disclosure is desperately needed. the 2012 disclose act introduced -- act is already supported by 40 senators. it is a bill that should be acceptable to people of every stripe. that is how it was designed. the previous bill imposed bans on government contractors and for unknown country -- corporations. those have been taken out. the 2010 legislation also required reporting donations of $600. that threshold has been raised

to $10,000. as we have seen, these huge donations work that amount and make the donation of $100 seem irrelevant. the new bearer bonds disclose act has two key components. -- vera bones disclose act. disclosure means outside groups to make independent expenditures should disclose all their large donors in a timely matter. the bill includes a way to drill down to the original source of money in order to reveal those who are using intermediaries as a conduit to obscure the true funders. this transfer provision, even the most sophisticated billionaires' will find it difficult to hide behind a 501c and as a sham. voters to -- 501c organizations. why should outside

organizations engaging in this same political activity be any different? the 2012 act would make super pacs and labor unions identified their top five funders. the leader of the organization would have to stand by the ad. transparency is not just a democratic priority. my colleagues on both sides of the aisle and have declared their support for greater disclosure as a way to prevent disclosure. eight of the nine supreme court justice is support disclosure. the potential for corruption is all too clear. it is time to get serious about full transparency. this bill would do that. that is why we're holding this hearing to examine the need for better disclosure and to discuss this particular legislation. before we turn to our distinguished panel of experts,

i want to ask my good friend if they would like to make opening statements. i would ask the statements by members and witnesses be limited to five minutes. let me: senator alexander. >> it is good to be with you on this beautiful spring day. this hearing is as predictable as the spring flowers. my friends on the other side of the aisle are trying to change the campaign finance laws to discourage contributions from people with they disagree. i deeply appreciate this and believe that the share man is showing forz? -- that the chairn is showing for the rick santorum and newt gingrich in this whole process. this a quickly called a hearing.

most of the enthusiasm for this hearing comes as the chairman indicated in his remarks because of the citizens united legislation. it says that rich, noncandidates and corporations have the same rights rich candidates have to spend their money to support a campaign. there is nothing in the constitution about full disclosure. there is something in the constitution about the free- speech. i often go by newseum. the provisions in this bill discourage free speech. fortunately, there is a way to have full disclosure and free- speech. that is to take all the limits of campaign contributions.

the problem is the limits. these new super pacs exist because of the limits be placed upon parties and contributions. you will have full disclosure because everybody will give their money directly to the campaigns. the campaigns must disclose their contributions. i have done some research and preparation for this and i founded especially compelling statement before this committee that was rendered just exactly 12 years ago today, march 29, 2000. some of you were here that day. it was given by an obscure former governor who had run for president and had permanently retired from politics and became before this committee and these were the words that he said. i have come to washington to argue one practical proposition.

that he contribution limits makes it virtually impossible for anyone except the front- runner for a remarkably rich person to have enough money to run a serious campaign. this has a number of bad effects for our democracy, limits the voters' choices. it protects incumbents, discourages insurgents. it makes campaigns too long. the thousand dollars limit was put in place in 1974 after watergate. it has just done the reverse. raise the limits. that obscured former governor was me. a few years earlier, senator mccarthy came before this

committee and said, he never would've been able to challenge lyndon johnson if others had not given him so much money in the 1968 campaign. the reason i am talking about limits is because if we took the laments of, we would solve the disclosure problem. rich cabinets can continue their campaigns. the supertax -- rich candidates can continue their campaign. presidential race is before they sure were like if the patriots lose the first three games, we tell them to get out of the race. in the nfl and the masters, you play all the way through to the end. having money is what you need to play all the way through to the end.

individuals have their rights to express themselves. in a way that does not chill free speech is to take off all polemics that would cause most contributors to give it to the campaigns, it would drive the super pacs and and make this legislation completely unnecessary. thank you, mr. chairman. >>qq given what we have seen n the republican primary-year, i believe that we must try to pass the disclosure act. in 2010, we came close to passing it and it looks like we need just one additional vote to move the bill forward.

this new act is a criticalhz stp to ensure that corporate dollars will not flow in the dark to one candidate against another. instead, our election process will regain the transparency it has lost after citizens united. i find this whole hidden shadowy world of the super pac to be really discouraging. i suspect it will have a very discouraging impact on canada said not yet run for office, --z candace that have not yet run for office, but might be considering it. there is no way the average hzperson can fight it.hz dzif the company does not like what you are doing, whether it is a bighz bank go out and get

this person with on told, known millions of dollars. i do not think it is the american method of electing candidates. i think this is the for step forward.hz i was really surprised at the supreme court. dzhzi want to thank the author i want to thank you and hopefully we can move on with this. >> thank you, senator. >> thank you for holding this hearing today. i appreciate the opportunity to discuss the disclose act. i have some concerns with the bill. as a former secretary state of missouri, i am interested in these policies that affect elections. i believe this bill would place additional burdens on nonprofits as they seek to advocates for public policies. i am also concerned about the

first amendment challenges this bill will present. we would be well served to examine our current laws and in short they're having their intended of fact -- in sure they're having their intended effect. that would be a good topic for another hearing, to look at the laws we have on the books now. i am pleased you're having this hearing. i look forward to hearing from the witnesses. >> thank you for the hearing. i support the disclose act. we're not talking about super pacs, we are talking about supersecret pacs. we have seen a dramatic increase in these independent expenditures. mere mortals who dare run for office have to wonder whether

they will be overrun by some super pac or some individual or some special interest group regardless of the merits of their campaign or what the voters may care for. what we're doing here is introducing an element that is corrupting. senators who have to wonder whether this morning's speech on the floor or tomorrows amendment just might irritate a las vegas casino magnate or two billionaire brothers because tomorrow the world may change for you. we have seen candidates in this race with more than $5 million spent by march in negative ads. that is a phenomenon which is not conducive to an active positive, and productive debate.

for something totally different, i support the disclose act. i really believe that we need to get to the heart of the matter. that is why i am introducing be fair election act, public funding. states have voted by referendum to move public funding, take a special interest out of the picture. shorter campaigns, less money spent, direct contact with the voters. that is what they think is the right thing for the future of their states. i think it is the right thing for the future of this country. major reform often requires a major scandal. sadly, this year's campaign for president is building up to a major scandal when it comes to fund raising. will it be enough? will it be the breaking point

for real change? i hope this bill passes. i hope it starts lifting the veil on some of the expenditures taking place. we need to step beyond this or we run the risk of dramatically changing this democracy. >> i just want to thank the senator for being here. he has been an active member of the task force. it is the whole decision that started this in this convoluted way of dealing with campaign finance reform. and has been a leader. >> thank you. this is an important bill and i

appreciate you holding a hearing on it. in january 2010, the supreme court issued its disastrous opinion in citizens united. two months later, the d.c. circuit court of appeals, they also decided. these two cases are the cases that gave rise to super pacs. millions of dollars poured into negative and misleading campaign ads. the citizens united decision renewed are concerned about campaign finance, but the court led the groundwork for this broken system many years ago. in 1976, the court held that restricting independent campaign expenditures violates the first amendment right to free speech.

in effect, money and speech are the same thing. the damage is clear. elections become more about the quantity of cash and less about the quality of ideas. more about special interest and less about public service. i do not think we can truly fix this broken system until we on to the flawed premise that spending money on elections is the same thing as free speech. that can only be achieved if the court overturns buckley or we amend the constitution. until then, we fall short of the real reform that is needed. we can still do all that we can do in the meantime to make a bad situation better. that is what we are trying to do with the disclose act. it is not a comprehensive reform that i would like to see, but it is what is possible under the flawed supreme court precedent. the disclosure act of 2012 and

asks the basic and fair question, where does the money come from and where is it going? this is a practical sensible measure and it does not get money out of our elections, but it does shine a light into the dark corners of campaign finance. a similar bill in the last congress had broad support with 59 votes in the senate and it passed the house. now that we are seeing the real impact of citizens united, the decisions on our elections come at the need for this legislation has become even more apparent. the downpour of unaccountable spending is wrong and undermines our political process and it is -- it has sounded an alarm that is truly bipartisan. i recall the debate when we considered the disclose act from the last congress. many of our concerns were still hypothetical. we can only guess how bad it

will get. now we know. our worst fears have come true. the toxic effect of citizens united and subsequent lower court rulings have become brutally clear. the floodgates to unprecedented campaign spending are open and threatens to drown out the voices of ordinary citizens. look at what we have seen already. we are only in the primary season. huge sums of money flooding the airwaves, an endless wave of attack ads paid by billionaires', the poisoning of our political discourse. abusing their nonprofit status to shield their donors and funnel money into super pacs. they spend at will and they hide at leisure. the american public looks on in disgust. a recent washington post poll

found that nearly 70% of registered voters would like super pacs to be illegal. among independent voters, at 78%. supporters of super pacs claim they are promoting the democratic process. the public knows better, wealthy individuals and special interest are biding our elections. our nation cannot afford a system that says, come on and to the rich and powerful and says do not bother to everyone else. the fate of the american people is shaken -- the faith of the american people and shaken by big money. it is time to restore that faith. it is time for congress to take back control. there is a great deal to be done. i will continue to push for a constitutional amendment. we need comprehensive reform. in the interim, let's shine a

light on the money. the american people deserve to know where this money is coming from and they deserve to know before, not after, they had to the polls. that is what the disclose apt will achieve. disclose act will achieve. >> his knowledge of all these issues and the fact that the judiciary committee is actively involved in this issue make us really glad that he is a member of this committee. >> thank you. i did join with you and the others in reduced -- and introducing this. i think it is an important hearing.

our efforts to restore transparency were gutted by a narrow activist majority in the supreme court. five supreme court justices overturned a century -- a law designed to protect our elections and corporate spending. struck down key provisions of our bipartisan campaign laws. i remain trouble today. the supreme court extended corporations the same rights to individuals americans. corporations are not the same as individuals americans. they cannot vote in our democracy. this country elected general eisenhower as president.

should we elect general electric as president? the boundaries -- the founders understood that to -- understood this. a very narrow majority of the supreme court did not want to believe what all americans believe. i cherish our democratic process. we ought to be heard -- we should not be undercut by corporate spending.

it will continue to happen until we start taking action. when i co-sponsored the first disclose act after the supreme court's decision in 2010, i hoped republicans would join me. we were trying to restore the law. all we needed was to have one republican vote to restore. we could have done it. instead, we didn't. they filibustered and needed that one vote. we did not get it. this is done to hurt both parties. -- this is going to hurt both parties. there is a flood of corporate money flowing from unaccountable sources. it will continue. the chairman mentioned, the

sudden and dramatic a facts of the republican primaries. this could happen either side. this project of-advertisements -- barrage of negative advertisements. this unintended did, undisclosed spending is hurting every one of us. it is one of the reasons why the american people are so turned off on how government is run. it is going to hurt every single person, but it is going to hurt the institutions i cherish. the congress, it will hurt the ability of republicans and democrats to work together for the best interest of the country. my state of vermont is a small stake. -- state.

that is wrong. a local city councils zoning board -- to stop the corporations from wiping them out. i would urge my colleagues, if you have an interest in getting government back where everybody knows who is involved and everybody knows he was spending, you have a chance for the candidates for their voices to be heard. if we do not do this, the inability of good people to come forward is going to stop and the disrespect of a institutions, including the united states supreme court, will grow. i can tell you right now, at this country will suffer. thank you. >> thank you. i would like to thank all of our colleagues for their statements. i would ask our witnesses to

come forward. >> i have a brief introduction for each witness. he was previously president and has served as a fellow at harvard university. he has been a nationally recognized leader on campaign finance and transparency. he has served as an analyst for cbs news and abc news. he served as executive vice president of the national taxpayers union and executive director of americans for a fair

taxation. he has written more than four dozen articles on election law issues and several books. articles -- he previously taught at loyola law school. >> i am president of democracy 21. i appreciate the opportunity to testify today in support of the disclose act. if the opportunity of rises

later on, i would like to address senator alexander's long-held use -- views on the disclose act. citizens deserve to know who is spending money. this has been recognized by the supreme court in repeatedly upholding the constitution -- constitutionality of the laws. millions of dollars in undisclosed constitutions -- contributions were injected into the race. this amount is expected to dramatically grow in 2012. this has returned the country to the era of the watergate scandals when huge amounts of

secret money were spent in federal elections. secret money in american politics is dangerous money. as the supreme court held, disclosure requirements the tar actual disruption -- corruption and avoid -- deter actual corruption and the appearance of corruption. new disclosure laws were enacted during the watergate era to address the problem of secret money in federal elections. from the mid-1970's until 2010, there was a consensus in the country among democrats and republicans alike in support of campaign finance disclosure. in the year 2000, in response to a disclosure loophole that was

allowing certain five to seven groups to spend on disclosed monday in federal elections -- by 2027 groups to spend un disclosed monday in federal elections, congress passed a bill to close the loophole. the senate vote was 92-6. bipartisan support for disclosure disappeared in 2010. the policy issues have not changed. the votes half. when is the senate going to return to the support for finance disclosure that was the rule cor -- for four decades. this was caused by a combination of the citizens united decision. this problem has made worse by

groups and improperly claiming tax exempt 501 status to keep secret their donors. we have petitioned the irs to change their regulations to deal with eligibility for this tax status. a campaign finance system that has it that the disclosures and does not exist today. that is what will be cured by be disclosed at. there is no constitutional

problem with the disclosure and no constitutional problem with be disclosed at. the supreme court by an 8-1 vote up held disclosure or the kinds of expenditures that are dealt with in this legislation. the court specifically noted the problems when groups ran ads while hiding behind dubious and misleading names and concealing the true source. the true the court also rejected the argument that disclosure can only apply in the case all express advocacy. thank you, mr. chairman. finished in exactly five minutes. you are a well rehearsed witness. >> mr. keating.

thank you for inviting the center for competitive politics to present our analysis. the goal of the bill is to increase disclosure four candidates. the bill will still speaks -- speech and hijack 25% or more of the advertising copy during an election year that simply mentions the name of a congressman. many of these provisions will generate significant first amendment questions and will generate that mission -- litigation that has a good chance of success. the most infamous provision of the mccain-feingold bill is its restriction on groups of mentioning the name of a person running for election within 30 days of a primary. this bill would stretch that restriction to the entire election year for members of congress. that will wreak havoc on groups

that want to use tv or radio ads. in my testimony, i give the example of an environmental group that might want to run ads advocating support of carbon monoxide regulation. some of them might work for a utility or a coal company. these donors might have supported the groups efforts. they may be listed on the act itself as supporting the ad when they do not support any such thing -- the ad when they do not support any such thing. another thing not talked about in this bill is the disclaimer requirements, which are totally ridiculous. law,ntly, under today's it's a radio ad for to run right now and there is no primary within 30 days, the ad for this

group i list in my testimony, which i made up, the radio had would just say, pay for by american actions for the environment. most americans would think that is a pretty good disclaimer. you know who paid for it. the bill would require this. it would take 10% of my testimony to read the disclaimer on this radio ad. it would have to say something like this and no editing is required. the fcc commissioner behind me can of firm this. the group i used to ask -- used to work for -- the fcc commissioner behind me can come from this period paid for by the american action group for the environment. not authorized by any candidate or can today's committee.

i am john smith. i am not really john smith, obviously. american action for the environment approves this message. major funding members are donald wasserman schultz. how can you produce a 32nd radio ad if you have 8 22nd disclaimer. -- a 20 second disclaimer. it is ridiculous to have this kind of a disclaimer on a radio ad. disclosures for all independent expenditures are required. and all contributions over $200 per year to further such communications. i give examples of this disclosure in my written statement. there is more in this bill that

goes beyond disclosure. it adds confusion to an election code and regulations that are already too complicated. they make the tax code looks simple by comparison. there is a new and indecipherable definition of express advocacy. that really should go from the bill. in conclusion, i want to emphasize that this bill piles new cops on nonprofits and other speakers, costs that are meant to tilt -- new costs on nonprofits and other speakers, costs that will still speak. thank you. >> professor? jz>> members of the rules and administration committee, thank

you for the opportunity to be here today to testify about the disclose at. i support the measure. it will allow for the enforcement of other laws. the proposed legislation uses high dollar thresholds and enables contributors to shield their identities when making 9- election related contributions. this ensures that the rise of three speech and association are protected. i hope the senate returns to its bipartisan consensus. we are aware of what justice kennedy thought the world would look like actresses since united. action has shifted from pacs and five to seven organizations to other 501c

organizations. how serious other problem is secret money? the center for responsive politics found that spending coming from groups that did not disclose rose since the 2006 elections. furthermore, with the rise of super packs, the jitters can shield their identity from the public, hiding from the public with names like americans for america. even worse, the jitters can shield their identities by contributing to a -- contributors can shield their identities by contributing to a 501c-4.

disclosing that a contribution came from three marks is not helpful to poulterers -- helpful to voters. a solution might be to return to the days before citizens united. disclosure is an important way to separate out corruption. disclosure laws provide valuable information to voters. pg and it provided almost $46 billion -- eg &e -- pe &e provide almost $46 billion to the yes on 16 campaign. a disclose law would help enforce other campaign finance laws.

the only way to find things out is through adequate disclosure. we have heard that the supreme court has repeatedly and unanimously upheld disclosure laws. the supreme court has also stated that it can -- is a group can prove a history of harassment, it is exempt from those rules. there have been recent court cases surrounding controversial ballot measures about gay rights and gay marriage.

the disclose act provisions are ingenious in allowing nonprofits to remain anonymous. the disclose act sensibly targets the activity. if someone is contributing money to ride an election at, that should be disclosed. thank you. >> i thank all three witnesses for their testimony. my first question is to mr. keating. you know the example professor hasen used. somebody contributes a great amount to a 501c-4.

the 501c-4 gives money to a superpac. your testimony does not account for that loophole. don't you agree that there is no effective disclosure when a 501c-4 is given a large contribution and a large percentage of that money is used to put money on television? >> it is already in the election laws. >> you are just having freedom works be the listing is not adequate. it does not tell us anything. you could have a false name in your example. citizens against pollution could be funded by people who want to remove pollution controls. just having any name on the ad

does not tell you anything. the name could be deliberately deceptive. do you disagree with that? 99% of all americans would say, sure. obviously. >> is the sierra club runs an ad, we need to know the donors to the sierra club? >> let's say the sierra club wants to take out somebody who is a defender in a state where coal is used. a set up a campaign saying citizens or coal used and the fund ads against that person, that candidate, that incumbent on an unrelated issue. this disclosure does no good. it is deceptive. it uses the name it sierra club, people know what the sierra club is. just using an obvious example. they could set up a shell

organization with a totally opposite name. the pollution that club. -- the pollution club. under the law today, all that would be disclosed is the name, the pollution club. >> you are incorrect about that. it is an independent expenditure, that group needs to report the donors used for that independent expenditure. that would be listed in the fec filings so that we would know that the sierra club gave to this front group you are talking about. >> go ahead. >> the statute does require contributors to be disclosed. the regulations issued by the fec have gutted the disclosure requirement. they have limited disclosure to

only individuals who give for the specific purpose of running those ads. no one says they do. that is how we wound up with $135 million in undisclosed contributions. >> the practical effect is that we do not know where this 501c-4 money is coming from and we will never know. >> if you listen to mr. keating closely is that he is talking about independent expenditures. these groups are running communications. contributions to fund communications are not adequately expose -- expose. >> so my example is correct. >> i believe so. >> my time is running out.

we will try to have a second round. my second question goes to mr. werthheimer. removing limits from contributions -- your proposal would be that everything would be disclosed, senator alexander. if someone wanted to get to an independent expenditure, there would be -- there would be disclosure of that. >> i am assuming that if the limits were elected, people would get to the campaigns and the campaigns and candidates would be disclosed. >> unless you did not want to disclose.

>> that would take us back to a system of legalized bribery. that me give a few comments from people other than me about this. the supreme court said contributions were necessary to deal with the reality or appearance of corruption inherent in a system permiting unlimited financial contributions. and in hand the corrupt system is what the supreme court called it -- an inherently corrupt system is what the supreme court called a system without disclosure of contributions. the system of unlimited contributions to national parties prostitutes ideals and the means democracy and -- demeans democracy and debases debate.

foreign -- former republican senator warren rudman said, i know how beholden elected officials can become to their country readers -- their contributors. unlimited contributions to parties is that what gets done and how it gets done. they affect outcomes as well. one last quote from a late former colleague of the senator, the chairman of the finance committee, who knew his way around campaign money. he once said the distinction between a large campaign contribution and a bride is almost double-bride is almost a hairline difference.

we go back to a system of buying results in the congress, direct purchases, if we go back to a system of unlimited contributions. senator alexander is saying let's go back to the system with no limits, which was in existence 30 years ago. >> it was in existence before we got watergate. >> thank you, senator schumer, for asking him that question. senator mccarthy had testimony before this committee. he said, watergate was cited as an example of the corruption of a system. there was nothing in the watergate that would have been made illegal by the 1975 act.

i would like to come back to limits on contributions. do you think be disclosed act if it is written, would have less spending on the groups affected? >> it is hard to say. there is no way to know in advance. there would certainly be a massive disruption in the way these organizations need to handle their fund-raising efforts. by other witnesses identified something in the regulations and the law. ay don't you just take surgical knife and six that one problem. i recently worked at the club for growth. that group was a qualified non- profit organization.

before citizens united, that group and planned part -- planned parenthood and some other groups, were allowed to do independent expenditures. they did not raise money for independent expenditures. we ran intended expenditures out of our general budget. that is something that most people agree groups should be able to find out of their own budget. is there is consensus created by the regulations being vague about raising money for independent expenditures, why not fix that one thing. this bill goes beyond that, it covers anything that is run during an entire election year. that goes to bank far. >> let me ask you --

>> that goes too bar. >> if we cut off independent contributions to campaigns, do you think that would dry up superpacs? >> that would change any money going to candidates. all super pac money would go to candidates. >> i had experience running a prison to campaign with limits and other campaigns. because of the limits in 1995 when i was a candidate, i went to 250 fund-raisers. i spent a lot of time to people -- with people who could afford to get $1,000. that raised 10 doubt -- raised $10 million or $11 million. steve forbes was able to spend

$20 million of his own money. in 2000, he spent $38 million of his own money. i told that to senator kerry when i was on the harvard faculty. i said, there has never been a credible candidate for president who has ever spent his own money. if you are ever in that position, it can help you. he was in that position in 2003. howard dean was beating him pretty badly. howard dean had raised $14 million. senator kerry put $6 million of his own money in and became the nominee. i watch fox and ms nbc sometimes when i am in the gym. they run ads regularly. their broadcasts are ask for a political point of view.

that is their right to do. in countries where we do not have a democracy, the first thing the leaders do is take public television stations and keep everybody else from having enough money and resources to advertise their view this -- views. as long as we have a its first amendment that prevents steve forbes and john kerry from spending their own money -- had a first amendment that prevents the corpse -- steep corpse and john kerry from spending their own money -- steve forbes and john kerry from spending their own money, they have to compete with the ads that the tv stations are already running. taking the limits off would solve almost all of the

disclosure problems. the money would be given to candidates and campaigns. and more people would participate in campaigns would run longer, as they have this year. more voters would have a chance to vote and elected officials would spend a lot less time with people who are not trying to give them money. thank you senator alexander. if you do not require disclosure of the superpacs, there will be people who want to get on disclosed. you still have that ability to do it. if you want to give $1 million to the candidate, you have to disclose it. my only question, just for clarification is, are you recommending that there be some kind of disclosure in the 501c4, c-6 and c-3's?

>> if you are willing to remove the limits, i am will lead to discuss what the limits should be. >> i amh< sitting here reflectig on the change in times. mr. keating mentioned that disclosure, not knowledge -- sunlight and knowledge or a radical idea. i do not see how it possibly can be. this bill is modest. you can give under $10,000 without disclosure to a super pac. it is over $10,000. someone who contributes over $10,000 generally had some kind of motivation to contribute. the disclosure simply allows individuals to look at this and

see who is supporting a candidate or a cause. what about this is such a radical idea? >> i may have been misinterpreted or maybe i misspoke. i was not talking about the bill itself being a radical concept. there are things in this bill that are quite radical. the government mandated disclaimer goes on for 20 seconds on a radio ad. this would cover all radio ads that bench in the name of a congressman. something as simple and innocuous as a bill before congress. it's is call congressman smith and i urge him to voted or -- it says, call congressman smith and

urge him to vote or the bill. why do we need a disclaimer that goes on for 20 seconds. to me, that is a radical approach. requiring groups to state a point of bureaucratic nonsense in a disclaimer that drives up the cost of advertising by a tremendous amount. >> i am running for reelection. big state. expensive for television. and yet, i can be irresponsible for the ads i put up on television. therefore, the disclaimer is important. it says to people that the act is speaking for me. and i take responsibility for it. >> what is radical is that the

bill specifies something that could be specified in fewer words. >> let's move on to television ads. there is accountability and responsibility for campaign ads. the television ads require the act to list the top five donors. that could be done in a crawl. with respect to the radio act, there are provisions that take less time better still in this bill. they give the fec the power to exempt the kind of ads that mr.

keating -- >> that is not correct. it only exists the major donor listing, not the rest of the disclaimer. >> there is a hardship exceptions' back -- exception that the fec can use. it takes 10 seconds. -- it takes 8 seconds. >> as a fellow californian, we have rules like this. we have political on the radio all the time. it is not a burden. you can get your message out and everyone does.

>> i was just reading about the pg &e case. @ua pac raise $240 million. pg &e is a good company. at one point, it donated 9 million in one day. there is a consumer group called the utility reform network. they wereh÷ the main opponents. they were able to raise $33,000. the pac outspent 500 to 1 . that amounts to approximatelymuu $25mumu per vote. they lost.

the reason they lost is because of the disclaimer. everybody was able to come to the@u conclusion, this is not there. this is the company about which this initiative is. it is not fair. the company is not@u@u@u@u@u@u y an@u individual speaking. @uit is a group. it is the board of@u@u@u@u@u@u@o make that decision. @u@u@u@u@u@uit seems to me thisd example of disclosure. in other words, the entity that dusty superpac without disclosure has an unfair position on the ballot. you would disagree with that, mr. keating. >> i am not familiar with the

details of california law. if it works there, i have no problem with that. >> thank you, mr. chairman. >> i believe our law is the?7e as california. the hardship exemption -- it takes 20 seconds to say their name. it is on page 21. >> is the heart ship exemption 8 seconds? >> i will read it. if the exemption is paid for in whole or in part as a campaign related disbursement, the top two thunders list is applicable. on the basis of criteria established by the commissioner, communication is of such short duration that

including the top two funders would constitute a hardship for the person by requiring a disproportionate amount of content of the communication to consist of the top two thunders. if you have a 32nd ads and the disclosure takes 20 seconds, -- if you have a 30 second ad and the disclosure takes 20 seconds, that is a hardship. >> the statute requires disclosure. gutted the p disclosure. >> the contribution disclosure. by defining the only contributions to be disclosed as contributions given for the specific purpose of making a kind -- making campaign related

disclosures. >> this would be contributions to these various purposes? >> yes. >> do you think we should be having a hearing on enforcing the statute? have a separate hearing on and mentally reforming the federal election commission. i do not think a hearing on enforcing a statute on this regulation will get us to solve a problem on disclosure. required disclosure. >> there is a contribution disclosure provision. it has resulted in more than $130 million not being disclosed. >> mr. keating made a statement

that club for growth should be able run ads out of their own budget. is that fair? >> yes. >> do you all agree with that? groups like club for growth should be able to run ads out of their own budget? >> yes. >> yes. as long as they apply with the applicable disclosure rules. >> what would those be? the disclosure rules for running ads out of your own budgets. >> you must disclose the did -- the expenditure to the fec within 48 hours. if money was given for the expenditure -- this is where i alluded to the confusion from the statute and the regulations. different people take different

interpretations of what that means. i worked at club for growth. we interpreted that to me that if you raise money just generally or an independent expenditure, the donor would have to be disclosed. other people may take a different view of that. that is how our group took review -- the view. when we ran ads, we never asked anyone for money for independent expenditures. >> you did not expose all of the donors on any report anywhere? >> that is correct because no money was given for independent expenditures. club for growth has a superpac. it uses that entity to raise money for independent expenditures. all of the donors for that organization are disclosed. >> the superpac donors for

club for growth are disclosed. the regular donors are not disclosed. >> correct. it's a group did raise money for in it and expenditures, -- if a group did raise money for independent expenditures, that money would have to be disclosed. >> is it accurate that a member of the house or senate -- which groups cannot mention their names or the entire year of the election. >> any group that wanted to run an ad for the entire election year, they would have to meet these requirements. >> how would you mention the name of a house member? >> you could not.

>> there are no restrictions in this bill. there are disclosure requirements. >> you cannotppxpxp mention so's name from january until the election. that is a pretty big restriction. >> the bill provides a definition of an election communication. if something triggers election communication, all this does is provide for disclosure information. there were limits before. in the mccain-feingold law, those were struck down. >> it takes 30-60 days in the law. it takes that same principle and expands its for an entire year. i would think that members of the house and senate would like that. that they could not have their

name mentioned without these restrictions for the entire election. that is half a house term and 1/6 of a senate term. i am think i am out of time. -- i think i am out of time. >> why couldn't it be both years? why couldn't it be both times? i do not see any ruling principle here. >> under existing law, have primaries and hal -- been held where superpacs ran ads and the donors were not disclosed until after the primary? is this a problem and how does the bill deal with it? p>> it was a big problem during the election. the south carolina and florida primaries were run and over with before we had the first disclosures of the superpacs and

who their commanders were. that was because the way the law currently -- disclosures of the úpsuperpacs and who they are thunder's were -- funders were. there was no disclosure of the donors until january 31. the bill fixes that by requiring disclosure to be made when the expenditures are made. you have to disclose the contributor as well. it does solve the problem that serious disclosure problem of superpacs that existed in this election. >> in the 2010 election -- i did not look at all of these, but i

think senator chuck schumer will remember days. senator bennett, our friend in colorado, told us that the total independent expenditures are overwhelmed both totals for the candidates, both democrat and republican. do you see, when we are moving down the road as we get into 2012 and 2014 where we have elections where the combined spending of super pak -- superpacs are well beyond what the candidates are spending -- is this a good trend? do you think this is good for democracy? >> no. nor do i think the solution to it is to remove the contribution limits. studies have shown that almost all of the super pak -- superpac

ads are negative attack ads. it if you remove to the contribution limits, you would still have superpacs raising large amounts of money and running negative adds. we believe one of the steps that should be taken and can be taken is to end the candidate- specific superpacs of the type we have seen in the presidential election. those superpacs can be eliminated. when the supreme court ruled in citizens united that corporate independent expenditures took place, they said they had to be independent of the candidate. they left to congress to define what is independent and what is coordination. once again, we have week and

confusing coordination rules. we believe a number of candidates specific superpacs are operating illegally. we feel you can define super packs in -- superpacs in a way that they will not be run by a close associate of the candidate. most people recognize that. they are hiding behind their own use -- own views of what constitutes -- a realization that the law will not be enforced by the fec. the supreme court has talked about independent expenditures in the past. they have to be fully independent, truly independent.

these superpacs are anything but those concepts. >> i know i only have a couple of seconds. it seems to me that in reading about the superpacs in thes president to campaign, these are individuals who worked closely with the candidate and may have left the campaign recently, left the official office recently or were the chief of staff within the last year. these are the kind of people who are running the superpacs and amassing the money. >> in most cases the candidate's bother ran -- father ran the superpac. >> this is a strange concept

that somehow it father can corrupt the sun through a donation. this is a strange -- the son through a donation. and husband cannot contribute to his wife because he might corrupt her. election law has strained provisions in it. we have heard the call for tax code simplification. one of the things we need to have is the election law simplification. fred has been a student of this for years and he is saying things that are misleading. there is a restriction in the definition of what an independent expenditure is. you cannot have someone who is going from a campaign to end -- to a pac working on that

expenditure for a number of days. there are restrictions. there is no evidence the superpacs are illegally coordinating. of course, people who know or understand or support these candidates may feel strongly about starting up such a group. that is not a surprise. the final thing i would like to observe is, money is not everything. look at the republican primary for president this time. look at the candidates who soared. it was on the strength of their performance at these debates. a lot of people were watching the debates. there are a lot of other ways of getting money. money is a part of speech. the increased amount of money we have in these primaries are a good thing -- is a good thing. there have been more fun brothers -- front runners. it has been p very p@púp p pco.

hp>> there is one example wherea rmajor fund-raiser that the campaign and a few days later left to work for the romney superpac. if you think that is illegal, maybe you should do something about it. the way p this works is that former close political associate of the candidates have p p púrúr have set up r these superpacs p. in the case of president obama, two former white house staff úpleft and set up usa action. this has happened over and over again. úpthe people running them are

closely tied to be candidates. in the@p case of presidentúpúp@a and mitt romney, they are sending their topúp a banks p r- aides to these events. they are coordinating with the expenditures of those fundraising events. i think that is blatant. this is happening all over the place. the highest priority is to protect the interests p of the american people, not the democratic party or the republican party. the american people have the bottom lineúp stake and they hae the right to know who is putting up the money and who is spending

it to influence their votes. >> i hope we could have a second round of questions. they moved up the vote. it started at 11:13. -- 11:15. i hope we can move this bill to the floor in a relatively short. bank of time. it is a -- short period of time. citizens united is corrupting the essence of our democracy. you cannot scream fire in a crowded theater. we have libel laws and anti- pornography laws. when a handful of individuals can have a hugely disproportionate effect on the election undisclosed, i think that corrodes the roots of our democracy. i worry about the future of our

country in terms of accountability. i take the liberty as chairman of making the closing statement. we have to move forward. with that, without objection, the hearing record will remain open for additional statements or 10 additional days. -- for 10 additional days. i want to thank my colleagues for participating. i want to thank our witnesses for and illuminating discussion. the committee is -- an illuminating discussion. the committee is adjourned. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012]