Working Paper No. 10-21:
The Michigan Auto Dealers Prosecution: Exploring the Department of Justice's Mid-Century Posture toward Campaign Finance Violations

Author(s):

Allison Hayward

Date Posted: April 2010

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Abstract:

In 1948, the American automobile industry, with its associated auto dealers, commanded an important position in the nation’s economy. With that position came wealth and political influence, but also, in the immediate post-war period, industry concern about the degree to which the government would control the peacetime economy.

Even in the 1940s, that industry’s political activities were subject to a degree of regulation.  Beginning in 1907 with the Tillman Act, Congress had enacted a series of laws limiting what individuals and corporations could do in federal elections. Those criminal provisions were rarely enforced, and guidance on their scope and application was elusive.

In 1948, the United States Department of Justice chose to prosecute three groups of auto dealers for making illegal corporate contributions to Michigan Republican party accounts, allegedly to influence federal elections.  This article explores the events leading to that choice and the results of the prosecutions.  As a rare exception to the usual lack of enforcement, the Michigan prosecution effort of the late 1940s can help us understand better the Department of Justice’s enforcement posture, and why enforcement was uncommon.