Career criminalizer: What the Earle of Austin has done.

IN 2002, Republicans took control of the Texas house for the first time since Reconstruction, setting in motion a process of congressional redistricting that led to the addition of five Republicans to the state's U.S. House delegation. Shortly after the 2002 elections, Travis County district attorney Ronnie Earle launched an investigation that would touch nearly every Republican involved in the 2002 takeover. After almost three years and six grand juries, Earle has succeeded in what he set out to do: He has indicted House majority leader Tom DeLay, the man many Texas Democrats hold responsible for the 2002 takeover and the subsequent redistricting. In the process, he has used abstruse campaign-finance laws to criminalize his political opponents--and demonstrated that these laws should be repealed.

In the months leading up to the 2002 elections, a group called the Texas Association of Business (TAB) put out a series of advertisements and mailers addressing the positions of various state legislative candidates on business issues. The ads avoided using words like "elect," "vote for," "reject," etc.--the magic words that, according to court rulings, change legal "issue advocacy" into illegal "express advocacy." Instead, the group said things like "Ann Kitchen voted 'NO' on giving the reading test next year" and "When it comes to questions about health care ... can you trust Raul Prado?"

These ads got the attention of Earle, an elected Democrat--especially after fellow Democrats like Kitchen and Prado lost their races and the Republicans won control of the Texas house. In January 2003, the Austin American-Statesman reported that Earle had launched an investigation into the financing of the ads. At issue was whether the TAB had used corporate contributions to fund them--a likely proposition, given the group's membership. Under Texas law, corporations are forbidden to contribute to political campaigns. The TAB maintained that its ads were issue-oriented because they did not expressly advocate the election or defeat of any candidate, and were therefore protected under the First Amendment.

First, Earle went after the TAB's list of donors--a move so hostile to the rights of organizations that the ACLU and the League of United Latin American Citizens filed briefs in support of the TAB. The strange political bedfellows all argued that forcing an organization to turn over its donor list threatened its ability to promise confidentiality to donors.

During hearings on the case, Earle compared the TAB to robber barons, Enron executives, and Mussolini-style fascists. According to the Austin Chronicle, another prosecutor on his team took it a step further--arguing that if the TAB succeeded there would be nothing to stop a Colombian drug cartel from forming a corporation and spending millions to influence Texas politics. Judge Mike Lynch ordered a compromise: He forced the TAB to turn over some information--the date, amount, and type of business of each donor--but let the TAB keep the donors'actual names confidential (though Earle learned the names of 20 donors when the TAB was forced to turn over documents as part of a civil lawsuit filed by Democratic candidates who lost).

Seeking to strengthen his case against the TAB, Earle tried to connect its ad campaign to the activities of the now-defunct Texans for a Republican Majority PAC (TRMPAC)--a group DeLay founded on the model of his Americans for a Republican Majority PAC (ARMPAC), to help Republicans win state legislative races in Texas. Earle was not able conclusively to link the TAB to TRMPAC, but as his investigation widened, he decided he would also go after TRMPAC for its use of corporate funds. The issue was whether TRMPAC had spent corporate contribution dollars on "overhead or administrative and operating costs," which is legal in Texas, or on political campaigns, which is prohibited.

Earle's investigation revealed that TRMPAC had spent some of the money it received from corporations on polling, phone banks, and other activities that its lawyers argued were not candidate-specific and therefore shouldn't be counted as contributions to political campaigns. As in the TAB case, these distinctions between express advocacy and other types of political activity did not concern Earle. He argued that because the activities were political in nature, funding them with corporate money was illegal.

Earle also singled out a transaction that involved TRMPAC, the Republican National State Elections Committee (RNSEC), and seven Republican candidates for the Texas legislature. In September 2002, TRMPAC sent a check for $190,000 in soft-money (corporate) donations to RNSEC, where lawyers and accountants put it in a separate account for corporate money. Corporate money cannot go to state elections in Texas, but it can go to elections in states like California or Virginia. RNSEC then sent checks from separate hard-money accounts totaling approximately the same amount to the Texas candidates the following October. Earle alleged that, taken together, these legal transactions constituted illegal money laundering--a first-degree felony--because the effect was to circumvent the ban on corporate money. Earle's case rests on his allegation that TRMPAC sent a document along with the checks directing RNSEC to distribute the money to the Texas candidates. TRMPAC lawyers say that doesn't matter, because the transactions were legal.

In September 2004, Earle convinced a grand jury to indict TRMPAC director John Colyandro, ARMPAC director Jim Ellis, a corporate fundraiser named Warren Robold, and eight corporations for TRMPAC's use of corporate funds, including a count of money laundering against Colyandro and Ellis for the TRMPAC-RNSEC money swap. In September 2005, he convinced a grand jury to indict the TAB for its corporate-funded issue ads. Afew weeks later, he convinced a grand jury to indict DeLay for conspiracy to violate the Texas Election Code regarding the TRMPAC-RNSEC matter.

On Monday, October 3, DeLay's lawyers asked a judge to dismiss the charges against him because the conspiracy statute didn't apply to the election code until 2003. Earle, facing the expiration of the statute of limitations, scrambled to get a new grand jury to indict DeLay for both conspiracy to commit money laundering and money laundering. After only one day of hearing evidence from Earle's team, the grand jury complied.

All of Earle's indictments share the same flaw, which is that they are based on what Ronnie Earle thinks is wrong rather than the letter of the law. The most glaring example is the indictment against the TAB, which did nothing more criminal than engage in constitutionally protected speech. How do we know it was protected? For one thing, until the McCain-Feingold law--which took effect after the 2002 elections--such issue ads were legal in both federal and state elections.

And they remain legal, to this day, in Texas. Campaign-reform advocates in Texas, such as Fred Lewis of Campaigns for People and Craig McDonald of Texans for Public Justice, have argued that Texas needs to follow the federal government's example and, as Lewis wrote in 2003, "ban the use of corporate money on pseudo-issue ads (ads during the height of the campaign that attack candidates but don't explicitly advocate voting against the candidate)." Lewis, a lawyer, surely wouldn't argue for the state legislature to ban something that was already illegal. So: What did the TAB do wrong?

The indictments against DeLay regarding the TRMPAC-RNSEC matter also fail the test of common sense. Prior to McCain-Feingold, both parties engaged in this kind of soft-money-for-hard-money swap all the time for the purposes of funding state races. An Institute on Money in State Politics study revealed that in October 2002, the Texas Democratic party sent $75,000 to the Democratic National Committee (DNC) and received $75,000 back from the DNC on the same day. In fact, Democrats transferred a total of approximately $11 million from their national party to fund Texas campaigns in 2002, compared with $5.2 million transferred by Republicans. This is not to say the Democrats were doing anything illegal--it's just to illustrate the legal landscape that 30 years of campaign-finance regulation had created by the year 2002.

Ronnie Earle likes to repeat the fact that Texas has had a law banning corporate funding of political campaigns since 1905--but, like most campaign-finance laws passed in that era, it was rarely enforced until the 1970s. Since the 1974 Federal Election Campaign Act, the courts have tried to strike a balance between preventing "corruption or the appearance of corruption" and protecting First Amendment rights, leading to what UCLA law professor Daniel H. Lowenstein has called a "patternless mosaic" of campaign-finance jurisprudence.

This patternless mosaic has created a system of campaign-finance laws that give incumbents more power than challengers, non-profits more latitude than for-profits, and giant news organizations more protection than bloggers. McCain-Feingold did nothing to "reform" the system--it merely criminalized more speech and diverted soft money from PACs to the so-called 527 groups like the Swift Boat Vets and America Coming Together. Now that First Amendment champion Bradley Smith has left the Federal Election Commission, there is little to stop politicians from criminalizing the speech of those groups next. Add to this already bleak mix a U.S. Supreme Court that looked the other way on McCain-Feingold's excesses, and the future of political speech in the United States has rarely looked worse.

Now that a campaign-finance prosecution has targeted one of its own, Congress may wake up to the need for less restrictive laws governing campaign finance, replaced by a greater reliance on transparency. Ronnie Earle is just one example of how a dedicated ideologue can use campaign-finance regulation to criminalize politics: It won't always be a Republican caught in the crosshairs. As Andy Taylor, an attorney for the TAB, says, "The scary thing is that this could happen to anyone if a prosecutor decided he wanted to go after him. The reason the ACLU and LULAC got involved in our case is that they realized that next time, this could be a Republican prosecutor charging them with a violation. It works both ways."

Mr. Spruiell writes the media blog for National Review Online.