Legal or not, Harris is seizing Biden’s campaign cash

President Biden’s sudden and unprecedented withdrawal with just a few months remaining in the 2024 presidential race raises a host of issues. One key question is how this unique scenario impacts Kamala Harris and the Democrats from a campaign finance perspective.

First, Democrats have already renamed the “Biden for President Committee” to the “Harris for President Committee.” Presumably, this “new” entity has already spent some money — meaning that Democrats are now committed to the proposition that Harris for President is entitled to the cash raised by Biden for President.

That course matters because of the legal background and related campaign finance rules. 

Every candidate has an “authorized committee.” A committee cannot be the “authorized committee” for more than one candidate and a candidate’s authorized committee can only give $2,000 to another candidate committee. The exception is that, after being nominated, a party’s candidates for president and vice president share a single authorized committee.

The Democratic position is that Harris, therefore, shared the Biden for President Committee with Biden since her nomination as vice president in 2020. This argument proposes that Harris can now access and spend the money. Republicans, however, can be expected to counter that Harris only could access these funds through the 2020 general election.

At present, and at all times since Nov 2020, she was not the party’s nominee for anything, nor was she running a campaign for office on her own — which would have required her to designate a different “authorized committee.” We may all “know” that the planned ticket was Biden-Harris, but it wasn’t official. Biden, or a delegate revolt, could have dumped her. 

Biden was a candidate for reelection as president in his own right, but, officially, Harris was nothing — not a candidate for president and not her party’s nominee for anything.

So, the GOP will argue that, by spending money from the Biden for President Committee on behalf of Harris for President, both the Biden for President Committee and Harris’s campaign violate the law.

As expected, the Republican response has been swift. The Trump campaign has just filed a complaint with the Federal Election Commission, alleging that Democrats have violated campaign finance laws by transferring Biden's campaign funds to Harris.

From here, the statutory deadlines and enforcement procedure — the FEC has no control over this — means it will be at least 60 days before the FEC could sue in federal court for a civil fine or injunction or refer it to the Department of Justice to prosecute as a “knowing and willful” and, hence, criminal violation. But that’s not allowing any time for the FEC to analyze the case, convene and vote, etc.

Thus, even if these procedures were executed at breakneck speed in response to the complaint, it would almost certainly be mid-October before a final vote by the commission to find the Democratic committees in violation. At that point, the Democrats will simply refuse to pay the fine, and the FEC will have to go to federal court to enforce its decision.

Of course, the court is unlikely to conduct a trial or even decide cross-motions for summary judgment before the election. The FEC could seek a preliminary injunction, but what court will issue a preliminary injunction hampering one party just days before the election, where there is at least a colorable argument that the law is on that party’s side?

It’s not happening. Even given all the unrealistic assumptions above about how fast the FEC could move, any decision will come after the election. If the Democrats have to pay a fine at that point, well, that’s just the cost of winning the election now.

But in fact, the odds are even longer, because even that scenario assumes that the FEC can get — as will be necessary — one of the Democratic commissioners to find a violation. How likely is that outcome, given the Democrats’ previously described plausible (if probably incorrect) argument for their interpretation of the law?

It's worth noting that the commission's structure and processes are intentionally designed to move at a thoughtful, measured pace. The FEC's bipartisan nature, with its equal number of Democratic and Republican commissioners, serves as a crucial safeguard against partisan enforcement of campaign finance law or hasty action that might unduly interfere with political speech.

This setup, which some mistakenly view as a flaw, is actually a vital feature that protects speech. It ensures that any enforcement action or new regulation requires bipartisan consensus, preventing either party from using the commission to unduly hamper their opponents' political speech — especially when, as here, the "other side" has a plausible argument.

A “tie,” in other words, goes to the speaker.

The bottom line in the present situation is that, despite the Trump campaign's complaint, nothing is likely to happen before the election. Assuming that Harris becomes the nominee, as now seems a given, she will likely be able to spend the money, with any potential penalties or legal consequences dealt with after the fact.

There are other aspects to consider in all this. For example, operating on the assumption that the Biden for President Committee can seamlessly become the Harris for President Committee, the Democrats have closed off the possibility for donors who have already given the legal maximum to Biden’s campaign to contribute now to the Harris campaign. If the Biden-Harris Committee is one and the same such that Harris is entitled to Biden’s cash, then donors have a single legal limit.

If Harris somehow does not win the nomination, the Democrats will have to ask her to transfer any remaining funds to the Democratic National Committee (DNC) or at least to a Super PAC, either of which can then make independent expenditures supporting the nominee.

Being limited to independent expenditures has two drawbacks for Democrats. First, they can’t coordinate their ads, which will be less efficient and effective than if the candidate could spend the money on messages. Second, unlike a candidate, the party doesn’t get the “lowest unit rate” on ad buys, so broadcast ads will cost them more — in some cases significantly more. 

And there is the possibility — slight but not nonexistent — that an embittered Harris wouldn’t give the money to the DNC, but do something like donate it to her alma mater to create a boffo Kamala Harris Library.

As should be clear from the above, we are in the midst of an uncertain situation that is only predictable up to a point. There may be more twists and turns to come in what has already been a truly unique campaign season. Nonetheless, the scenarios outlined above are the most plausible in my view.

Bradley A. Smith is the chairman and founder of the Institute for Free Speech and a former chairman and commissioner of the Federal Election Commission.