Here we go, from Russia with love, to campaign finance with love.
Why was Michael Cohen investigated? Because the “Steele dossier” had him making secret trips to meet with Russians that never happened, so his business dealings got a thorough scrubbing and, in the process, he fell into the Paul Manafort bin reserved by the special counsel for squeezing until the juice comes out. We are back to 1998 all over again, with presidents and candidates covering up their alleged marital misdeeds and prosecutors trying to turn legal acts into illegal ones by inventing new crimes.
The plot to get President Trump out of office thickens, as Cohen obviously was his own mini crime syndicate and decided that his betrayals meant he would be better served turning on his old boss to cut the best deal with prosecutors he could rather than holding out and getting the full Manafort treatment. That was clear the minute he hired attorney Lanny Davis, who does not try cases and did past work for Hillary Clinton. Cohen had recorded his client, trying to entrap him, sold information about Trump to corporations for millions of dollars while acting as his lawyer, and did not pay taxes on millions.
The sweetener for the prosecutors, of course, was getting Cohen to plead guilty to campaign violations that were not campaign violations. Money paid to people who come out of the woodwork and shake down people under threat of revealing bad sexual stories are not legitimate campaign expenditures. They are personal expenditures. That is true for both candidates we like and candidates we do not. Just imagine if candidates used campaign funds instead of their own money to pay folks like Stormy Daniels to keep quiet about affairs. They would get indicted for misuse of campaign funds for personal purposes and for tax evasion.
There appear to be two payments involved in this unusual agreement. Cohen pleaded guilty to a campaign violation for having “coordinated” the American Media payment to Karen McDougal for her story, not for actually making the payment. He is pleading guilty over a corporate contribution he did not make. Think about this for a minute. Suppose ABC paid Stormy Daniels for her story in coordination with Michael Avenatti or maybe even the law firm of the Democratic National Committee on the eve of the election.
By this reasoning, if the purpose of this money paid, just before the election, would be to hurt Trump and help Clinton win, this payment would be a corporate political contribution. If using it not to get Trump would be a corporate contribution, then using it to get Trump also has to be a corporate contribution. That is why neither are corporate contributions and this is a bogus approach to federal election law. Note that none of the donors in the 2012 John Edwards case faced any legal issues and the Federal Election Commission ruled their payments were not campaign contributions that had to be reported, both facts that prosecutors tried to suppress at trial.
Now, when it comes to Stormy Daniels, Cohen made a payment a few days before the election that Trump attorney Rudy Giuliani says was reimbursed. First, given that this payment was in October, it would never have been reported before the election campaign and so, for all intents and purposes, was immaterial as it relates to any effect on the campaign. What is clear in this plea deal is that, in exchange for overall leniency on his massive tax evasion, Cohen is pleading guilty to these other charges as an attempt to give prosecutors what they want, which is a Trump connection.
The usual procedures here would be for the Federal Election Commission to investigate complaints and sort through these murky laws to determine if these kinds of payments are personal in nature or more properly classified as campaign expenditures. On the Stormy Daniels payment that was made and reimbursed by Trump, it is again a question of whether that was made for personal reasons, especially since they have been trying since 2011 to obtain agreement. Just because it would be helpful to the campaign does not convert it to a campaign expenditure. Think of a candidate with bad teeth who had dental work done to look better for the campaign. His campaign still could not pay for it because it is a personal expenditure.
Contrast what is going on here with the treatment of the millions of dollars paid to a Democratic law firm which, in turn, paid out money to political research firm Fusion GPS and British spy Christopher Steele without listing them on any campaign expenditure form, despite crystal clear laws and regulations that the ultimate beneficiaries of the funds must be listed. This rule was even tightened recently. There is no question that hiring spies to do opposition research in Russia is a campaign expenditure, yet no prosecutorial raids have been sprung on the law firm, Fusion GPS or Steele. The reason? It does not “get” Trump.
So, Trump spends $130,000 to keep the lid on a personal story and the full weight of state prosecutors comes down on his lawyer, tossing attorney-client privilege to the wind. Democrats spend potentially millions on secret opposition research and no serious criminal investigation occurs. Remember that the feds tried a similar strategy against Democratic candidate Edwards six years ago and it failed. As Gregory Craig, a lawyer who worked both for President Clinton and Edwards, said, “The government theory is wrong on the facts and wrong on the law. It is novel and untested. There is no civil or criminal precedent for such a prosecution.” Tried it there anyway and it failed.
Let us also not forget that President Clinton was entrapped into lying about his affairs and, although impeached, was acquitted by the Senate. The lesson was clear: We are not going to remove presidents for lying about who they had affairs with, nor even convict politicians on campaign finance violations for these personal payments.
With Cohen pleading guilty, there will be no test of soundness of the prosecution theories here, and it is yet another example of the double standards of justice of one investigation that gave Clinton aides and principals every benefit of the doubt and another investigation that targeted Trump people until they found unrelated crimes to use as leverage. Prosecutors thought nothing of using the Logan Act against former Trump national security adviser Michael Flynn, but they are using obscure and unsettled elements of campaign finance law against Trump lawyer Cohen to manufacture crimes in what is a naked attempt to take Trump down and defeat democracy.
Trump should do a better job of picking aides who pay their taxes, but he is not responsible for their financial problems and crimes. These investigations, essentially based on an opposition dossier, were never anything other than an attempt to push into a corner as many Trump aides and family members as possible and shake them down until they could get close enough to Trump to try to take him down.
That is why so many of his aides, lawyers, and actions in the campaign and in the White House have undergone hour by hour scrutiny to find anything that could be colored into a crime, leaving far behind the original Russia collusion theory as the fake pretext it was. Paying for nondisclosure agreements for perfectly legal activities is not a crime, not a campaign contribution as commonly understood or ruled upon by the Federal Election Commission. Squeezing guilty pleas out of vulnerable witnesses does nothing to change those facts.
Mark Penn is a managing partner of the Stagwell Group, a private equity firm specializing in marketing services companies, as well as chairman of the Harris Poll and author of “Microtrends Squared.” He served as pollster and adviser to President Clinton from 1995 to 2000, including during Clinton’s impeachment. You can follow him on Twitter @Mark_Penn.
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