While “follow the money” has been a phrase associated with politics since the Richard Nixon era, newly proposed bipartisan legislation targeting online political spending could make it easier to trace the money in the digital era.
On Thursday, U.S. Senators Amy Klobuchar, D-Minnesota, and Mark Warner, D-Virginia, introduced a bill that would make political ads on platforms such as Facebook and Google transparent like those on TV and radio stations. The Honest Ads Act, co-sponsored by Sen. John McCain, R-Arizona, would require companies with more than 50 million monthly users to maintain a public database containing information about all ads bought by anyone spending more than $500 in a year. The record would include a variety of info: a digital copy of the ad, a description of the targeted audience, the average rate charged for the ad, the name of the candidate or issue the ad refers to and contact info for the buyer. Companies that don’t comply would be subject to penalties by the Federal Elections Commission.
At a news conference announcing the bill, Klobuchar and Warner said the legislation is needed to update election laws for the digital era, pointing out that a majority of the $1.4 billion spent on online ads went to Google and Facebook. The bill is also in response to the recent revelation that Russian accounts bought ads on a number of platforms including Facebook and Twitter that were seen by millions of people before and after the 2016 presidential election.
While tech companies have opposed regulation in the past, Klobuchar said the Russian meddling has prompted some major tech companies to realize that “we’re in a whole different area.” She said one set of laws should not apply to some media outlets while others get a free pass.
“Some of them are now coming out voluntarily and saying we need to do something about it,” she said. “They’ve admitted there’s a problem—always the first step—and I think the argument some of them would make is ‘oh let’s just do this voluntarily.’ And the problem is it has to cover everyone. You can’t just have a few companies doing it voluntarily. At least the bigger platforms like we’re starting with. And you also want to have it in our laws.”
According to Warner, the bill would take a “light-touch approach” to regulation, providing some framework. However, it doesn’t cover everything. For example, he said the bill doesn’t cover how to handle fake accounts such as bots that impersonate voters or candidates.
“The identity piece is a much tougher place, and I hope that the platform companies would come up with some ideas,” he said. “They’ve indicated they’re going to try and do more of that policing.”
Spokespeople for Twitter, Google and Facebook were quick to issue vague but supportive statements, vowing to both work with Congress and the FEC while also taking steps on their own to increase transparency.
“We stand with lawmakers in their effort to achieve transparency in political advertising,” Erin Egan, Facebook’s vp for U.S. public policy, said in a statement. “We have already announced the steps Facebook will take on our own and we look forward to continuing the conversation with lawmakers as we work toward a legislative solution.”
A number of groups have already endorsed the proposal, including the Campaign Legal Center, the Sunlight Foundation, Issue One and the Brennan Center for Justice. The Interactive Advertising Bureau has also thrown its support behind helping lawmakers improve regulations.
“We are ready to work with the authors of both the House and Senate political advertising bills to consider new approaches to effective transparency,” said Dave Grimaldi, evp of Public Policy, IAB. “Preventing interference in U.S. elections is essential, and our industry is committed to sensible reform that achieves that goal while preserving free expression.”
Meredith McGehee, chief of policy of programs and issues at Issue One, a nonpartisan nonprofit working to limit campaign spending by large donors, said increasing disclosures is the best way to fight foreign interference in elections. She said the Honest Ads Act is “a good faith effort to get that conversation started,” adding that it’s important to make online political spending more transparent.
“Listeners are entitled to know by whom they are being persuaded, and that from the radio days has applied,” McGehee said. “And there is no reason it shouldn’t apply for online platforms.”
She added: “What’s particularly interesting is with these online platforms they have unprecedented, uncanny ability to slice and dice their audience with such specificity and such targeting that it makes their ability to direct their messages more powerful.”
While McGehee is in support of the bill, she pointed out that it’s not going to prevent everything. For example, she said 50 percent of ads bought by Russian troll farms were $3 or less, and Facebook said 99 percent of them were less than $1,000.
“You really have to think though it’s not the same as buying an ad on television or even on radio,” she said. “Scope of money is very different, so that’s why it’s so important to have these hearings so we can get more information on the public record and ensure that everyone has a complete picture of the kinds of efforts that are being run by not only Russia but other entities as well.”
Political strategists who buy ads on behalf of the candidates and political parties also say it’s time to require more information from online ad buyers.
“Our belief is that digital can and should be the most accountable platform in the political world,” said Andrew Bleeker, CEO of the Democratic digital marketing firm Bully Pulpit Interactive. “Certainly, there is the potential to be much more so than television or direct mail. But there also some things that make it a little more complicated and a little more different in terms of how we need to regulate them.”
Those challenges that are tougher to address include dealing with “nontraditional actors” like foreign governments and “nontraditional formats” like promoted stories on a platform that wouldn’t be a seen as a typical ad. To better address these concerns, BPI created a website focused on educating regulators and industry players about online advertising.
“The challenge is if someone, anyone, with a bunch of money decides they want to start promoting a bunch of news stories, that’s a trickier thing,” he said. “That can be a nation state or a wealthy individual, and how do we make sure we are actually understanding who those people are. That’s why we’re very focused on also making sure we get to entity verification.”