Only about half the states restrict foreign funding of ballot measures, and some of those laws still leave loopholes big enough to exploit.
Foreign billionaires and well-funded nongovernmental organizations can use a gap in federal election law to pour money into state ballot-measure campaigns. Half the states have yet to ban the practice, and some of those that have acted still leave openings for foreign-linked spending.
Federal law flatly bars foreign nationals from contributing to political candidates. State ballot initiatives and referenda, however, are treated differently under the Federal Election Campaign Act. Unless state law says otherwise, foreign nationals can spend to influence those measures. Because ballot campaigns can rewrite state constitutions, alter election rules, redraw districts, and affect turnout in candidate races, that distinction is no small matter.
One of the best-known examples involves Swiss billionaire Hansjörg Wyss. Americans for Public Trust has documented hundreds of millions of dollars in Wyss giving to U.S. political nonprofits. The Honest Elections Project notes that the left-wing Sixteen Thirty Fund alone received $243 million from Wyss and spent more than $130 million on ballot issues in 25 states.
Those figures deserve one qualification. Nonprofit funds are commingled, so they do not prove that Wyss’ dollars paid for any particular ballot campaign. But money is fungible. The fact remains that current federal law permits an organization that receives enormous sums from a foreign national to spend heavily on domestic ballot measures.
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S. T. Karnick is a senior fellow and director of publications for The Heartland Institute.
