H.R. 1 Would Fix – and Protect – Democracy in the U.S.

As its first order of business in the new Congress, the House proposed a package of sweeping democracy reforms in H.R. 1: legislation that aims to limit money's influence over politics, strengthen ethics laws, protect voting rights, and end partisan gerrymandering. This important bill, which the House Judiciary Committee is holding a hearing about on Tuesday, would go a long way towards fixing U.S. democracy at home as well as prevent foreign actors from meddling in it from abroad.

Concern about foreign influence is not new, nor are congressional efforts to prevent it. In the last century, concern about Nazi propaganda efforts led to the passage of the Foreign Agents Registration Act (FARA). In 1976, Congress enacted laws barring foreign nationals from financially influencing U.S. elections. And at the turn of the 21st century, following an investigation into Chinese nationals funding the Democratic National Committee, Congress strengthened that prohibition and banned unregulated "soft money" that could mask foreign spending.

Recent elections have revealed new ways for foreign actors to interfere in our democracy – and offer compelling new reasons for Congress to act.

First, the Supreme Court's Citizens United decision and the regulatory failures that followed opened new avenues for foreign interests to secretly influence U.S. elections. Although foreign money is banned in U.S. elections, there are few ways to know whether politically active dark money groups received foreign funding, because the Federal Election Commission (FEC) has allowed them to keep their donors hidden from the public. (For example, the FBI is reportedly investigating whether any foreign money flowed through the National Rifle Association's dark money arm, the NRA-ILA, which spent more than $30 million on 2016 races.) Similarly, foreign actors could readily give to super PACs by laundering their money through dark money 501c4s or shell corporations that keep the true donors anonymous.

Second, as political campaigning moves online, Congress and the FEC have failed to update campaign finance law for the digital age – and foreign actors have exploited that inaction. $1.4 billion was spent on digital political ads in the 2016 election, but voters were often left in the dark about who paid for those ads; it was only after the election that we learned that the Russian government had secretly purchased thousands of ads on platforms like Facebook that reached millions of Americans.

Third, current law allows wholly-owned U.S. subsidiaries of foreign corporations to write million dollar checks to super PACs, which presents an obvious opportunity for foreign owners to influence elections. Indeed, 2016 reporting by The Intercept uncovered how a U.S. subsidiary of a Chinese corporation transferred $1.3 million to a super PAC supporting Jeb Bush, and did so under the direction of its Chinese owners.

Fourth, loopholes in the Foreign Agents Registration Act (FARA) and weak enforcement have allowed lobbyists for foreign national to evade public disclosure of their activities on behalf of foreign powers—as demonstrated by the recent indictments of Paul Manafort and Michael Flynn for undisclosed lobbying activities.

H.R. 1 includes critical fixes to these legal loopholes.

The legislation would bring dark money into the light by requiring all groups spending money in elections to disclose donors giving over $10,000. It would bring transparency to the dark money daisy chain – where funds are passed between multiple entities to evade disclosure – by creating donor tracing mechanisms. It would take aim at shell LLCs by calling for beneficial owner disclosure.

H.R. 1 targets secretive online influence campaigns by enacting the bipartisan Honest Ads Act, which ensures that digital political ad spending is subject to the same transparency measures as political spending on any other medium. And it would prevent foreign corporations from influencing elections through subsidiaries, by banning contributions by corporations with significant corporate ownership or control.

Moreover, recognizing that the risk of foreign influence does not end when the election is over, H.R. 1 would additionally require disclosure of gifts from foreign agents to officeholders.

Finally, a critical element of any effort to combat foreign interference is robust enforcement. Not only does H.R. 1 strengthen enforcement of FARA, it also reforms the agency that was designed to be the cop on the beat that would faithfully enforce campaign finance laws: the FEC. Any legislation passed by Congress means little if the agency charged with enforcing it refuses to do so. H.R. 1 fixes the FEC by ending the gridlock that has plagued it over the last decade.

H.R. 1 would go a long way toward addressing our election system's vulnerabilities to foreign influence. Congress should make its passage a top priority.