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15 December 2011

Testimony: December 15th Hearing on Campaign Finance

By Diana Hsieh

This morning, I'll be attending and testifying at the Secretary of State's hearing concerning the proposed changes to Colorado's campaign finance rules. The audio from the hearing will be live streamed here. We'll be in the "Blue Spruce Room" from 9 am to 12 pm MST.

I plan to speak, of course, and my written testimony is below. I will be giving the first half, up through the contact information, in person at the meeting. Written testimony by others can be found here. (I'm so grateful to everyone who submitted testimony in favor of greater freedom of speech! That's hugely important, and much appreciated!)

Comments on the Secretary of State's Proposed Rules Concerning Campaign Finance

Diana Hsieh, Ph.D
Coalition for Secular Government
December 15th, 2011

My name is Diana Hsieh. I'm a philosopher by trade, writing and speaking on the application of philosophy to the challenges of everyday life. I'm not particularly active in politics, except on the issue of abortion rights. In 2008 and 2010, I worked with Ari Armstrong against the proposed "personhood" amendments to our state constitution. We didn't just want to see these measures defeated: we wanted to explain and defend our view of the proper basis of abortion rights. The "personhood" ballot measures were a prime opportunity for us to do that.

Unfortunately, our efforts were seriously hampered by Colorado's onerous and intrusive campaign finance laws. The same will happen in the upcoming 2012 election, even with the proposed rule changes. As a citizen activist, that's extremely frustrating and disheartening. Nonetheless, I support the proposed rule changes, with one exception. They clarify the demands on people who choose to speak about Colorado elections, and they limit the legal risks of doing so. We won't have fully free speech, but we'll have somewhat freer speech.

To explain why I support most of the proposed rule changes, I'd like to briefly recount my experiences in the 2008 and 2010 elections. (I described these experiences in more detail in the May 3, 2011 hearing on raising the reporting threshold for issue committees from $200 to $5000, and that's included in my written testimony.) After that, I'll explain my reasons for supporting the proposed rule changes pertaining to issue committees, with one exception.

My Experiences, In Brief

In 2008, Ari Armstrong and I wrote a policy paper against Amendment 48, the proposed "personhood" amendment to Colorado's constitution. I published it under the auspices of the "Coalition for Secular Government," which was then and still is now, little more than me and a blog. Ari and I wrote the paper without compensation, and I spent a few hundred dollars of my own money to promote it.

Only by happenstance, I learned that I was obliged to file campaign finance reports. With my first non-zero report, the hassle of typing in the names and addresses of Office Max, The UPS Store, and the Post Office (where I spent just under $200 in total on office supplies, photocopies, and stamps to distribute the paper) convinced me that to spend any money to promote our paper was too much trouble. I felt that chilling effect on my speech very keenly.

In 2010, Ari Armstrong and I revised and expanded our paper to oppose Amendment 62, the next "personhood" amendment on the ballot. This time, the work was funded by generous donors, in the form of 63 pledges ranging from $4 to $300 for a total of $2795. These people, most of whom I knew personally, wanted Ari and me to speak for them, to explain and defend our common view of abortion rights, and we were eager to do that.

When I reviewed the campaign finance regulations, I was appalled to discover that I was required to report the name and address of any contributor giving $20 or more, plus the occupation and employer for any donation over $100. Why was I so upset? First, the process of compiling and filing the reports was extremely burdensome, eating away hours that I could have spent opposing Amendment 62. Second, my contributors were entitled to privacy, particularly on a controversial topic like abortion. Third, I feared that even a trivial error in a report could result in massive fines, plus attorney fees to defend myself. The little money that I'd reserved to promote the paper, plus my own payment for writing the paper, would quickly vanish: I'd be forced to sacrifice my personal savings, just to exercise my right to free speech. That fear stays with me, even now, and gnaws at me. Ultimately, the result was basically the same as in 2008: I was unwilling undergo the troubles and risks of filing more reports, and so I opted not to raise any more funds for our work. Again, I felt the chilling effect of these campaign finance laws.

Based on these experiences, I know that Colorado's campaign finance laws constitute a major violation of free speech rights. Free speech means that people are entitled to express and advocate their ideas without forcible inference from the government or anyone else. Free speech also means that people are entitled to join together in their speech: they have a right to pool their resources and their talents so as to more effectively express and advocate their common ideas.

Here in Colorado, we do not have free speech in elections. We the people are not entitled to join together to express our views on upcoming elections, unless we register with the government and submit regular reports disclosing minute details of our finances. Failure to do so--even if only some trivial error--can result in being dragged into court by our political opponents and then being forced to pay hundreds if not thousands of dollars in fines. Here in Colorado, we speak about election issues not by right, but by government permission.

Free speech requires nothing less than repealing or overturning all of our campaign finance laws. In the meantime, however, the campaign finance rules can be made less confusing, less onerous, and less risky. The proposed rule changes are a huge step in that direction (with one exception), and that's why I support them. Here, I'd like to discuss four proposed changes: (1) the definition of an issue committee, (2) privacy for contributors worried about safety, (3) penalties and waivers, and (4) aggregating contributions and expenditures.

(1) The Definition of an Issue Committee

As I understand the current rules, any group of two or more persons qualifies as an "issue committee" if the group (a) works for or against a ballot measure as a "major purpose" and (b) spends or receives more than $200.

Proposed Rule 4.1 affirms that the $200 reporting threshold is raised to $5000, although litigation is pending. I support that change: small groups with limited resources should be able to advocate for or against ballot measures without incurring the onerous burden of registering, opening a new bank account, and then reporting their finances. As I said in the May hearing, however, I'd like the reporting threshold to be raised even higher, at least to $10,000.

Proposed Rule 1.12.3 defines a "major purpose" as meaning that more than 30% of the group's spending concerns a ballot measure. I support that change too. The campaign finance rules should clearly identify which groups qualify as issue committees, so that people can know whether they're obliged to report or not. Without clear criteria, any group doing work related to a ballot measure must file, purely as a defensive measure. However, for the sake of greater freedom of speech, I'd like to see the term "major" in "major purpose" interpreted more narrowly as meaning that over 50% of the group's spending concerns the ballot measure.

As much as I appreciate the bright line created by this rule change, I'm doubtful that it can be applied to my own ever-expanding work against the "personhood" movement. In the 2012 election season, the Coalition for Secular Government won't be narrowly focused on defeating Colorado's likely "personhood" amendment: we plan to work against "personhood" measures on the ballot in other states, as well as against the "personhood" movement and for abortion rights more broadly. Any attempt to estimate what percentage of our spending concerns Colorado's ballot measure would be arbitrary. Hence, I'll have to register and file reports as an issue committee, even if only as self-defense. I don't see any way to apply the "major purpose" criterion objectively in a case like ours, where any work concerning the ballot measure is part and parcel of a much larger and broader advocacy effort. Nonetheless, I support the rule change. The current language can be interpreted any which way, and the proposed definition of a "major purpose" would clarify the criterion for many groups.

(2) Privacy for Contributors Worried about Safety

By the current rules, reports must include personal information about contributors, such as names and addresses (if the contribution is $20 or more) and occupations and employers (if the contribution is $100 or more). That information is then published on the web for anyone to see. That has been of particular concern for me, given the harassment and even violence perpetrated by some anti-abortion activists against abortion rights supporters.

Proposed Rule 20 would permit people who fear for their own or their family's safety due to information disclosed on any campaign finance report to request that such information be redacted. That's definitely an improvement over the current rules, for the change would permit people to donate without fearing that they risk life and limb in so doing.

Once again, however, I worry that the rule change is too modest, meaning that "safety" is too high a bar. People have a variety of perfectly valid reasons for wishing to contribute to causes anonymously, such as wishing to avoid unpleasant conflicts with co-workers, clients, or neighbors over politics. A person with unpopular opinions should not be forced by law to risk ostracism to support a political cause. Also, I regret that this option for privacy requires more paperwork for what ought to be protected as a right--namely, the right to speak anonymously, and, by extension, the right to enable others to speak for you while remaining anonymous.

(3) Penalties and Waivers

Under the current rules, failures to comply with the campaign finance rules can incur fines of up to $50 per day per violation, without limit. Fines have often grown far beyond a group's ability to pay. According to the 2010 manual, the Secretary of State's office grants waivers and reductions of fines at their discretion using the vague "good cause" standard. That makes the process ripe for abuse, including partisan favoritism and other forms of bias.

As far as I understand, proposed Rule 18 would establish clear standards for penalties and waivers. Waivers would be granted for specified good causes, penalties would start small then increase with successive offenses, penalties would be limited based on the resources of the group, and mistakes would be penalized far less than willful failures to comply. Also, total penalties would be limited to $50 per day per report for 180 days, i.e. $9000 per report.

These changes are hugely important, in my opinion. The possibility of incurring hundreds if not thousands of dollars in fines for failing to comply with a mess of confusing campaign finance regulations should terrify any sane person. More than anything else, the current possibility of ridiculously large fines, totally disconnected from any intentional wrongdoing and out of proportion to the group's ability to pay, silences political speech in Colorado. The current rules, in fact, make election speech into a privilege of the wealthy, for only they can afford to pay the current fines. That's terribly unjust: the poor should have just as much right to speak as the rich. That's why I'd recommend limiting the fines even further.

(4) Aggregating Contributions and Expenditures

Now, I turn to my sole major objection to the proposed rule changes--and it's significant. By the current rules, contributions of $20 or more must be itemized, including the name and address of the contributor. The rules don't say any more than that, and hence, a person can give multiple donations of less than $20, and those donations are never itemized. The same applies to expenditures.

Rule 10.1 changes that policy: if the total contribution from a given source for a given reporting period is greater than $20, then it must be itemized on the report, even if the individual contributions by that source are always less than $20. (The same does not apply to the $100 threshold for occupation and employer, however.) Also, any contribution from an LLC must be itemized, regardless of size. Rule 10.2 does the same for expenditures: for each reporting period, expenditures to the same source must be aggregated, then itemized if over $20.

I'm partly sympathetic to the goal of this rule change. The current rules are unclear, and to allow many donations under $20 from the same source without itemization seems like a "loophole" that should be closed. However, to close this "loophole" entails dramatically increasing the burdens imposed on issue committees, such as myself. How so?

Under the current rules, I need only collect personal data about a contributor if he contributes $20 or more. That's a ridiculously low threshold, but at least it's a bright line for data collection. Under the new rule, however, I'd have to collect personal data from every contributor, even from someone who just gives me a $1 bill. Why? That person might give me twenty such bills over the course of the reporting period, and in case that happens, I need to identify all donations from that person in my records, add them up for the reporting period, and then itemize them in my report if they total $20 or more. At that point, I might as well just itemize every contribution (and every expenditure too), whatever the amount, just to be on the safe side. Plus, I'd have to inquire with every contributor to ensure that the money doesn't come from an LLC, for if so, I'd have to flag that in my records to report it, regardless of its size.

The burden imposed by this rule change would be enormous for many issue committees. Contributors would be burdened too, as they'd be obliged to give their name and address with every contribution. That information would likely become part of the public record in any lawsuit. In effect, this rule change would prohibit even small anonymous contributions, and that might deter many people from contributing any dollar amount. Moreover, the unscrupulous political opponents of an issue committee could easily abuse this new rule. A person could make a few small contributions to an opponent over the course of a reporting period, some in cash or otherwise anonymously, in the hope of entrapping the group in a campaign finance violation. And then, if his name and address wasn't listed on the report, he could sue.

For these reasons, I adamantly oppose this rule change. The new rule seems easy, simple, and fair in the abstract. Yet in practice, it would impose a major burden on issue committees and become fodder for partisan abuse. I urge you to reconsider this change.


In summary, I support most of the proposed changes to Colorado's campaign finance rules. The changes would make the rules less confusing, less onerous, and less risky. That's good for free speech and good for elections. However, our ultimate goal must be fully free speech in our elections--and that requires the elimination of all campaign finance laws. Mandatory disclosures do not make elections transparent: they only silence people, particularly ordinary citizens seeking to speak their minds.

Contact Information

Diana Hsieh, Ph.D

Coalition for Secular Government
P.O. Box 851
Sedalia, CO 80135


Coalition for Secular Government

Coalition for Secular Government on Amendment 48 (2008)

Coalition for Secular Government on Amendment 62 (2010)

Addendum: My Experience with Colorado's Campaign Finance Laws

The following testimony was submitted for the May 3, 2011 hearing concerning raising the reporting threshold for issue committees.

My name is Diana Hsieh. I'm an ordinary citizen, albeit with a Ph.D in philosophy. I earn my living my writing and speaking on applying ethical principles to daily life. I'm not a political activist by trade. I have strong views on politics, but I'm not terribly interested in engaging in the rough and tumble of politics.

On occasion, however, I jump into the fray, usually because I care about some issue so deeply that I just can't stand to remain silent. That's almost always some issue local to Colorado. That happened in 2008, with Amendment 48, then again in 2010 with Amendment 62. Those were the "personhood" amendments, and I opposed them vehemently.

Here, I wish to recount how the existing campaign finance rules impaired my ability and willingness to speak against those amendments. Then I will explain why the proposed revisions will have the very same chilling effects on the speech of ordinary citizens like me. Finally, I will suggest changes to the current system that would substantially protect freedom of speech within the constraints of Colorado's constitution.

In 2008, Ari Armstrong and I wrote and published an 18-page policy paper against Amendment 48. We didn't merely want to oppose the advocates of "personhood," we also wanted to offer an alternative to the major pro-choice coalition, which we regarded as compromising on the moral issues. They didn't speak for us; we wanted to speak for ourselves.

Ari and I published that 2008 policy paper under the auspices of the "Coalition for Secular Government." That's a nonprofit corporation registered in Colorado, but really, that's just me and a blog. The Coalition for Secular Government didn't solicit or accept donations, and I paid for its few expenses personally. Consistent with that, Ari and I wrote the paper without any compensation whatsoever: it was purely a volunteer effort. After we completed the paper, I spent a few hundred dollars of my own money to print and mail copies of the paper to media and activists in Colorado.

At the time, I didn't imagine that these activities would be subject to any campaign regulations. After all, I was just exercising my right to speak freely on an issue that I cared deeply about--or so I thought. However, just to be sure, I checked the web site of Colorado's Secretary of State. I found nothing relevant to my activities, so I thought I was in the clear.

However, I was very wrong in that. A friend knowledgeable about Colorado's campaign finance laws told me about the regulations for "issue groups." So I went back to the web site of Colorado's Secretary of State, searching for information. Even once I knew what to look for, it took me over an hour to find the relevant regulations. Even after I read them again and again, I was still quite confused about how to comply with the law.

More importantly, I was appalled that my home state forbade me from speaking freely on an ballot issue that I cared deeply about--even just to spend a few hundred dollars of my own money promoting a paper that I wrote with a friend. Even worse, I could be subject to hefty fines for failing to comply with laws that I could neither find by diligent searching, nor understand by careful reading.

In addition, I found complying with the regulations--entering store names, addresses, and amounts for my few purchases of photocopies, envelopes, labels, and stamps--to be so onerous that, after filing my first report, I swore that I'd not promote the paper in any way that required money thereafter. Hence, the burdens of complying with the law -- even just to spend a few hundred dollars -- were sufficient to silence me, in part.

The same problems arose in 2010 when Ari Armstrong and I wanted to significantly revise and expand our paper for Amendment 62. Instead working for weeks on the new paper for free, we used a new business model that I'd developed in the meantime to solicit pledges to fund the project. People who supported our work could pledge to fund it in any amount they chose. If $2000 or more was pledged in total, we would update and expand the policy paper. People would only pay their pledges if we completed the work by the deadline. Much to our delight, we received 63 pledges, ranging from $4 to $300, for a total of $2795. These contributors agreed with our position, and they wanted us to speak for them in defense of abortion rights.

Ari and I were enthused and motivated by these pledges. They were concrete proof that we weren't alone: other people cared about what we were doing and supported us with their own hard-earned dollars. Plus, we were very grateful to be able to pay ourselves for the many hours of work required to revise, publish, and promote the new paper. With these funds, we could also buy Facebook ads to promote the paper.

Alas, my enthusiasm wore off quickly when I remembered the reporting requirements for "issue committees." Once again, I had trouble finding the rules: I had to call the office of the Secretary of State to be pointed to their location on the web site. When I realized that I'd have to report the names and addresses of most of our contributors, I was deeply distraught. That reporting of personal information was required for any contribution of $20 or more. For contributions of $100 or more, I had to report the person's employer and its address too.

I was upset because such reporting violated the privacy of my contributors. As part of their right to free speech, people should be able to speak anonymously--or fund the speech of others anonymously. These campaign finance regulations forbid that for any contribution of $20 or above, and that's wrong. Voters do not have a right to know the sources of funding for other people's political speech, any more than your neighbor has a right to know what you got for your birthday or what you buy at the bookstore.

Moreover, I feared serious harm might come to my contributors from this invasion of their privacy. Due to the furor over abortion in some quarters, the publication of personal information about my contributors made them easy targets for harassment or even violence by anti-abortion activists. Would you be willing to risk your life or your job in order to donate $25, $50, or $100 to a political cause? That's what my contributors were asked to do, and that's not reasonable.

On a more personal level, I was disheartened by the prospect of compiling and filing the reports. I knew that process would be far more onerous this time than in 2008. It was even worse than I expected, however, for reasons that I will explain shortly.

For a while, I considered canceling the project entirely. However, I couldn't stand the thought of being silenced by these campaign finance regulations. Instead, I decided to inform every pledger of the reporting requirements, then allow them to cancel or decrease their pledges, if they wished to preserve their privacy. Most were shocked and angered that the state of Colorado required me to gather and publish their personal information in order to accept their support for my work. Some reduced their pledges to be below the $20 and $100 thresholds. Most didn't want to be silenced, so they reaffirmed their commitment to pay what they'd pledged. A few were even so angry that they increased their pledges.

Consequently, Ari and I went forward with the project, revising and expanding the paper into a robust 43-page defense of abortion rights titled "The 'Personhood' Movement Is Anti-Life: Why It Matters that Rights Begin at Birth, Not Conception." I was--and still am--extremely proud of that paper. Yet the burden imposed on me by these campaign finance regulations was almost too heavy to bear.

To comply with the law, I spent hours filling out and faxing paperwork to open bank and PayPal accounts for the Coalition for Secular Government. Then, once contributors began to pay their pledges, I had to compile and submit reports to the state every two weeks. Each report required a few hours of my time, and each was due a mere two to three business days after the close of the reporting period. To file the reports, I had to keep an extra set of books in an Excel spreadsheet, just so that I could track my contributions and expenditures in the format required for the reports. Of course, the reports for the state never quite matched my own records on the first try, so I'd have to double-check and triple-check every entry. I had to e-mail contributors for their addresses, and sometimes for places of work. Sometimes, finding the address of a business was a difficult chore: I was in a panic at 11:30 pm on the night that a report was due, desperately trying to find a physical address for Facebook. Even once I'd gathered all that information, the process of inputting it into the system--typing in address after address--was a major chore.

To add insult to injury, I was petrified of making a mistake with every report I filed. Too much was unknown to me--for example, the Facebook ads for the paper were paid for on my personal credit card, so should I report that as an expenditure when that credit card was billed, when it was paid, or when I reimbursed myself? When should I report contributions sent as checks--when I picked them up from the post office or when I deposited them in my account? If a person wrote two checks for $19, would I have to report his name and address if I received and/or deposited them on the same day? I didn't know the answers to those questions, and I couldn't afford to consult a lawyer. I could only try to be careful--and hope for the best.

However, I forgot to file my first report for a few days, due to a mess of other pressing problems in my life from a backed up septic pipe in the house to scheduled travel to the east coast. In addition, I didn't have all the information that I needed for that report, including the addresses of many contributors. On realizing my error, I was in a state of dull panic for days, worrying that the $1000 I'd earned for writing the paper--if not more from my personal funds--would vanish in a puff of $50-per-violation-per-day fines. So I begged for a waiver. That was degrading, but I was desperate, particularly because I had no idea how some unknown state employee would judge my failure to file the report on time. Much to my relief, the waiver was granted some weeks later.

Those experiences strongly discouraged me from raising and spending more money to oppose Amendment 62, as I would have done otherwise. I could have asked for contributions to fund more Facebook ads, for example, but I didn't want to have to file more reports. I was simply weary of and disgusted by the whole process.

In short, compliance with the campaign finance laws consumed hours of my life--hours that I could have spent promoting the paper, writing op-eds, working on other projects, or even just watching a movie with my husband. With every dollar contributed or expended, I risked fines that I couldn't afford to pay. I was unable to speak as a matter of right, but rather only by government permission. I felt the pressure to just give in and give up--to say nothing--very keenly.

How many other ordinary citizens decline to speak out on ballot measures due to these regulations? I can't give you numbers, but as one of those ordinary citizens, I can tell you that the chilling effect is very real.

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