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NOT MANY will have heard of the US Supreme Court ruling Buckley vs Valeo, and there is no particular reason anyone should. But regarding any discussion about ‘dark money’ in democratic politics, it is an interesting place to start.
In January 1976 the Supreme Court of the United States reached the landmark decision in Buckley vs Valeo. It decided by a majority of justices that limits on election spending as laid out in the Federal Election Campaign Act 1971 was unconstitutional1. It is significant not least because it would eventually lead on to infamous Citizens United v. Federal Election Commission in 2010. The Citizens United decision ruled that free speech clause of the US First Amendment prohibits the government from restricting independent expenditures for political campaigns by corporations, including non-profit corporations, labour unions, and other associations2. The journey from Buckley vs Valeo 1976 to Citzens United v Federal Election Commission 2010 is the story of the rise of ‘dark money’ in US politics, of the rise of the phrase ‘money is speech’.
But also worth reflecting on regarding the Buckley vs Valeo decision is that in a late-added footnote on the decision it established in the US the notion of the ‘eight magic words’3.
Under the Buckley ruling, speakers that did not invoke any of the eight specific words and phrases of Buckley, or similar language expressly calling voters to vote for or against a candidate, were exempt from campaign finance laws: "vote for," "elect," "support", "cast your ballot for", "Smith for Congress", "vote against", "defeat", "reject", or any variations thereof.
So, in US politics the mentality was born whereby if you were suitably vague enough, you were free from the more onerous burdens of campaign finance laws. And all because the Supreme Court in 1976 seemed blithely unaware that their late-added footnote 52 would have such an impact on electoral politics.
Dark money has eaten away at the integrity, transparency and trust in US electoral politics. Hugh amounts are spent, donated by unknown figures and corporations and dolled out to swing voter behaviour - or purchase influence with politicians. This shadowy ‘free speech advocacy’ sustains itself in the darkness where accountability dies a death.
‘Dark money’ itself as a phrase originates in the US, referring to political spending by non-profit organisations which are not required to disclose their donors. These sorts of organisations can receive unlimited donations from individuals or corporations, and can be spent in elections to influence voter behaviour or outcomes without anyone ever knowing where the money came from.
BUT this is not a moment for any of my fellow Scots to feel that irritatingly common cultural instinct of self-satisfaction in their ‘Scottishness’. That Scottish notion of an innate exceptionalism due to our culture being somehow predisposed to the ‘common weal’ has always been nonsense. A ludicrous mentality born out of the puerility of cultural nationalism. You see dear reader, there is something deeply wrong with our politics here in Scotland too. We have our own crisis caused by ‘dark money’, out-of-date electoral laws and poor legal judgement-calls.
The Electoral Commission is the independent agency that regulates party and election finance and sets standards for how elections should be run in the UK. It is our equivalent of the US Federal Election Commission. And unless you were sleeping under a rock, you will have noticed that we had an election in May 2021 which saw the Scottish National Party and Scottish ‘Green’ Party secure enough seats to have a pro-independence majority in the Holyrood parliament. But recent revelations are coming to light which compels us to wonder how ‘dark money’ could be influencing our Scottish elections.
The Electoral Commission has rules concerning what campaign activity is regulated and the rules non-party campaigners may need to follow. Non-party campaigners are
“individuals or organisations that campaign in the run-up to elections, but are not standing as political parties or candidates”4
So far, so clear. And there are two types of non-party campaigns, ‘local campaigns’ and ‘general campaigns’. For the purposes of our focus in this article we are only interested in the rules and obligations concerning ‘general campaigns’ by non-party campaigners.
The exact definition of a ‘general campaign’ is as follows
“non-party campaigns for or against a political party, or particular categories of candidates, including campaigns on policies or issues closely associated with a particular party or category of candidates (for example, candidates in a certain age group)”5
And the law demands that if a non-party campaigner is spending (or plans to spend) more than £10,000 in Scotland “on regulated campaign activity during a regulated period, you must register with us as a non-party campaigner”. The reason for needing to register is simple enough, once they register any and all donations they receive, loans they obtain and money they spend is registered with the Electoral Commission for the duration of the ‘regulated period’ (for example, the months immediately prior to an election). This ensures we know who is donating to the non-party campaign, how the money is being spent and when loans etc are repaid. It means full and complete transparency concerning how money is influencing our politics during an election.
The problem arises when we consider the activities of a group called ‘Believe In Scotland’, which is a branch of ‘Business for Scotland’ (the pro-independence economic think tank set up before the 2014 referendum).
Now the ‘regulated period’ for the Holyrood elections of 2021 was January 6th to May 6th 2021. During that period anyone planning a ‘general campaign’ should have registered as a ‘non-party campaigner’ with the Electoral Commission. That is the law as I understand it relating to ‘Political Parties Elections and Referendums Act 2000 (PPERA)’.
LET US TALK now about the spending ‘Believe In Scotland’ engaged in during the regulated period of January 6th 2021-May 6th 2021.
During the regulated period in question the campaign group ‘Believe in Scotland’ (a branch of Business For Scotland') paid for electronic billboards, Facebook adverts and polling before the vote on May 6th.
Business For Scotland approached the Electoral Commission in advance of the regulated period enquiring whether or not they would need to register as a ‘non-party campaigner’ group (and therefore need to declare their spending and donations etc with the Electoral Commission).
According to Business For Scotland
“We discussed our 2021 plans with the Electoral Commission, explained that we were not campaigning for any party standing in those elections and that our campaign was ongoing – and they agreed that we were not required to register.
We have never and will never accept funds from political parties, our neutrality is very important to us. All our funding comes from events revenues, publication sales, memberships, and donations.”6
But, if we examine examples of their ‘ongoing’ campaign during the regulated period in question, it is far from clear that it did not potentially fall foul of the definition of what constitutes a ‘general campaign’ requiring those responsible to register as a ‘non-party campaigner’.
Remember, if a “non-party campaigns for or against a political party” then this would be a ‘general campaign’ of a non-party campaigner. And if we examine an example of some of the electronic billboards and posters Believe In Scotland put up, they were clearly treading a very fine line regarding the letter and spirit of the law
In example 1 we can see a poster put up during the regulated period7, and it seeks to link Conservative & Unionist Party leader Boris Johnson with Donald Trump. It asks the question ‘cut from the same cloth?’ It could be construed that this poster represents a campaign against a particular political party during the regulated period of an election. However defenders could argue that no, it does not say ‘vote against’ or ‘stop’ etc.
But here we are in the world of the US Supreme Court’s ‘magic words’, and how if you carefully phrase what is clearly campaign spending in particular ways then you do not need to be subject to proper levels of election-time transparency.
The Electoral Commission’s rule book regards ‘regulated campaign material’ as being anything that
“can reasonably be regarded as intended to influence voters to vote for or against: one or more political parties; political parties or candidates that support or do not support particular policies or issues”
Look again at example 1 above, and then consider if it can “reasonably be regarded” as intending to influence voters “for or against” a political party, or candidates that support a particular policy or issue. And also look at example 2 below, and ask yourself the same question.
One could argue that ‘independence is normal’ is not endorsing and could not be seen to be endorsing any particular political party or list of candidates, as there is more than one Scottish party backing independence. And this might be true, except it is again a pretty grey zone.
Ultimately the key point here is tens of thousands of pounds was being spent by Business For Scotland via ‘Believe In Scotland’ during our elections in ways designed to influence voter behaviour. Otherwise why bother doing it in the first place? And on that basis as voters we ought to be able to expect transparency, clarity and openness.
Playing just inside the laws so as to avoid needing to register as a non-party campaigner is simply morally dishonest behaviour.
How much, precisely, was spent by Believe In Scotland for their electronic billboards, Facebook adverts and polling before the vote on May 6th? Nobody knows, and they refuse to tell us. Who donated the money that paid for the posters and facebook adverts? They refuse to tell us, at least officially via Electoral Commission disclosure. Sure, Business For Scotland has put out a press release claiming
“Our spending was independent of all political parties – we have never and will never accept funds from political parties, neutrality is very important to us.
Our funding comes from four key revenue streams and arrives mostly through micro-donations. See our successful 2021 fundraiser, it’s not a secret!”8
But what about individuals who are in a political party? What about wealthy businessmen? And how much is ‘mostly’ regarding revenue funds coming from micr-donations?
But putting aside obvious questions raised from their public statement, we have absolutely no ability to verify if this is true or not. Why? Because they failed to register as a non-party campaigner during the regulated period, so there are no registration of spending, donations, loans on the Electoral Commission website.
Indeed, the last donation registered with the Electoral Commission by Business For Scotland was way back in 2014, December 31st9. Since then, nothing. And ‘Believe In Scotland’ does not appear under any category (loans, donations, spending) on the Commission website at all.
And according to Business For Scotland’s micro company accounts they listed £50,000 due to creditors and total assets of 59,519. They have no total for ‘cash on hand or at the bank’10.
So here we have a situation where a pro-independence campaign group that has opaque funding sources. That engaged in campaign spending during an election period but carefully avoided certain phrases or magic words that might otherwise have obliged them to register and thus suffer full transparency.
As Scottish Labour Party Deputy Leader Jackie Baillie informed the Times, clarity is required
“over how much this organisation spent, where its money comes from, what connection they have with the SNP and why they have failed to register as a non-party campaigner.”11
Dark money is corrosive in a liberal democracy. It damages trust and undermines public confidence. The United States political troubles stem to a significant extend due to a political ambivalence regarding who is spending money and where it comes from. Scotland is not immune from the spectre of dark money, magic words and shadowy spending justified by the splitting of legal hairs.
Voters deserve better. A good place to start would be to launch an inquiry into dark money spending, seeking to ascertain whether some groups who failed to register as ‘non-party campaigners’ really ought to have done so. And seek to overhaul existing electoral laws so that activities such as those undertaken by Believe In Scotland must always be subject to the fullest transparency.
Federal Election Commission, United States of America, Buckley vs Valeo | https://www.fec.gov/legal-resources/court-cases/buckley-v-valeo/
Federal Election Commission, United States of America, Citizens United vs FEC | https://www.fec.gov/legal-resources/court-cases/citizens-united-v-fec/
Hasen, Richard L., The Untold Drafting History of Buckley V. Valeo (July 1, 2002). Loyola-LA Public Law Research Working Paper 2002-15, Available at SSRN: https://ssrn.com/abstract=320828 or http://dx.doi.org/10.2139/ssrn.320828
Electoral Commission, United Kingdom, ‘Overview of regulated non-party campaigning’ | https://www.electoralcommission.org.uk/sites/default/files/pdf_file/to-activities-npc.pdf
Electoral Commission, United Kingdom, ‘Overview of regulated non-party campaigning’ | https://www.electoralcommission.org.uk/sites/default/files/pdf_file/to-activities-npc.pdf
Believe In Scotland, Public Statement regarding Times of London investigative article, January 24th 2022 | https://www.believeinscotland.org/the-times-embarrasses-itself-with-cack-handed-attack-on-believe-in-scotland/
The National, ‘Scottish independence: Campaign that compares Boris Johnson to Donald Trump launched’, February 14th 2021, Judith Duffy | https://www.thenational.scot/news/19089110.scottish-independence-campaign-compares-boris-johnson-donald-trump-launched/
Believe In Scotland, Public Statement regarding Times of London investigative article, January 24th 2022 | https://www.believeinscotland.org/the-times-embarrasses-itself-with-cack-handed-attack-on-believe-in-scotland/
Electoral Commission, Business For Scotland most recent donations received | Click here
Business For Scotland, micro-company accounts, ‘Micro company accounts made up to 31 December 2020’ | https://find-and-update.company-information.service.gov.uk/company/SC430989/filing-history
Times, ‘Call for ‘dark money’ campaign inquiry’, 24th January 2022, Kieran Andrews | https://www.thetimes.co.uk/article/call-for-dark-money-campaign-inquiry-sklbqwlgs