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As the internet and social media drown in opaque political ads, U.S. reform efforts have gone nowhere

The 2020 cycle has again exposed the total failure of America’s campaign finance laws.

Scott Greytak

Advocacy Director, Transparency International U.S.

The 2020 U.S. elections are on track to cost $11 billion dollars, with an estimated $7 billion spent on political advertisements. And standing between such record-shattering spending and the fragile, reeling integrity of the U.S. political system is a failed regulatory framework.

TV ads still command a big share of the money that candidates, political parties, and outside groups spend on American elections, but it’s digital ads that now make up the largest slice. They bookend our YouTube videos and Facebook timelines, and pop up on our Pandora streams, Google searches, and Instagram feeds. These technologies had the capacity to help level the playing field and empower more Americans from all walks of life to have a meaningful voice in their elections. Instead, they’ve become only the latest tools for the wealthiest and most powerful to broadcast their agendas—throwing gasoline on the underlying inequalities that continue to engulf America’s faltering democracy.

Responsibility for the U.S.’s failed regulatory framework is equal parts the U.S. Supreme Court and the U.S. Congress. Flawed Court decisions like Citizens United v. Federal Election Commission are the reason that a tiny slice of rich Americans can spend unlimited amounts of money on digital ads, but congressional deadlock is the reason these ads can run with little or no transparency.

When asked to name the worst decision from the Supreme Court during her 27-year tenure on it, the late Justice Ruth Bader Ginsburg chose Citizens United. “I think the notion that we have all the democracy that money can buy strays so far from what our democracy is supposed to be,” she said. For present purposes, Citizens United carried two consequences: it held that “independent” spending—spending that is not coordinated or arranged with a candidate—can’t be limited, because it “do[es] not give rise to corruption or the appearance of corruption,” and then it extended this rule to corporations, including those that are allowed to keep their donors a secret. Together, this means that America’s uber-rich can spend unlimited amounts of money on digital ads, either directly or through corporations that do not have to disclose them as donors. Sure enough, in the decade since Citizens United, ten megadonors and their spouses have spent some $1.2 billion on federal elections, and “dark money”—money spent by those corporations that do not have to reveal their donors—has flourished, totaling close to $1 billion since Citizens United and approaching the $200 million mark for the 2020 cycle, including an estimated $16 million spent on Facebook and Google ads.

Yet while warped, even the Court’s restrictive legal framework left open a few areas where Congress could regulate. For example, the House of Representatives passed the Honest Ads Act in early 2019. Honest Ads takes the transparency rules already in place for TV and radio ads, and extends them to cover digital ads as well. It would also prohibit foreign entities from buying digital ads, and would require large digital platforms like Facebook and Google to maintain a public database of political ads. Additional efforts like the For the People Act, or H.R. 1, would require the “dark money” groups that spend a significant amount of money on elections, including on digital ads, to disclose their large donors.

Unfortunately, these efforts died quick deaths in the Senate, which has thoroughly refused to take up such issues whatsoever. This recalcitrance is at odds with not only recent history—robust political disclosure was supported by the last five presidents before Donald Trump—but with how cities and states have responded to the surge in opaque political spending. In 2018, for example, voters in deeply conservative North Dakota and famously progressive San Francisco approved new transparency laws that apply to digital ads. The North Dakota measure is now the most expansive in the country, requiring the “prompt, electronically accessible, plainly comprehensible, public disclosure of the ultimate and true source” of spending greater than $200.

Absent rules from Congress, platforms have been left to their own devices. Some, such as Twitter, LinkedIn, TikTok, and Spotify, have simply sworn off political ads altogether. A handful of others have adopted new practices and protocols, but each response has proven to be incomplete. Facebook and Google, for example, now require disclaimers on political ads and maintain public libraries of ads they run, but Google limits transparency to a very narrow category of political ads, and both companies fail to reveal the full range of targeting parameters that steer a particular ad to a particular user, among other issues. Streaming platforms such as Hulu and Roku lag even farther behind, offering little transparency into their financing and targeting.

Most importantly, all of these new rules, of course, are completely voluntary. No federal law stops these companies from changing their minds once public attention has drifted elsewhere.

As the home of “Big Tech,” the U.S. can and should play an outsized role in getting the issue of digital ad transparency right. Whether in the form of the Honest Ads Act or otherwise, 2021 must be the year Congress meets the moment, declares the rising tide a high-water mark, and begins to demonstrate national leadership on an issue with truly global resonance.



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