BUZZFLASH NEWS ANALYSIS
by Meg White
Today the House Administration Committee heard testimony on the Democracy is Strengthened by Casting Light on Spending in Elections, or DISCLOSE Act (HR. 5175).
As the legislation was written in response to the changes made to campaign finance as a result of the Supreme Court ruling on the Citizens United case, it shouldn’t surprise you that witnesses included the president of Citizens United, a lawyer for the U.S. Chamber of Commerce and several organizations concerned about the opening of floodgates of corporate funding in the wake of the controversial decision.
The DISCLOSE Act would force corporations and groups participating in political campaign speech to disclose their donors, among other provisions designed to lessen the effect of corporate dollars and lobbyists on elections. (For a better idea of what things would be like if the bill were law, scroll down to the bottom of this page.)
“The DISCLOSE Act would begin to get behind the money shell game” in elections, said Lisa Gilbert, a democracy advocate for U.S. PIRG (the federation of state Public Interest Research Groups) in her opening statement. “This bill has begun to get the bipartisan support that it does indeed deserve.”
Unfortunately, that bipartisanship has been limited to the House. Sen. Chuck Schumer (D-NY) introduced companion legislation in the Senate (S. 3295), which has been referred to the Senate Rules Committee. It hasn’t garnered any Republican support there, though the House version has two GOP co-sponsors in Reps. Mike Castle (R-DE) and Walter Jones (R-NC).
Opponents of the legislation tried to drive a wedge between the two parties during today’s hearing. The Chamber of Commerce had already denounced the legislation as a “brazen attempt to tilt the playing field in favor of the incumbent party in this fall’s elections, silence constitutionally protected speech, and abridge First Amendment rights,” language that suggests a legal challenge should the bill become law. Their lawyer, Theodore Olson, used his opening statement to insist that the bill was written so that it favors incumbents and “entrenched positions” and that it opposes those who try to “throw the rascals out.”
Throughout the hearing, various speakers suggested that the timing of the legislation was suspicious and that the bill was created to try and avoid Democratic losses in this year’s election cycle.
Donald Simon, a lawyer for Democracy 21, countered that the bill is “not partisan in its impact” and that Republicans were up until very recently supportive of increased disclosure laws in election regulation. “Republicans who have supported disclosure in the past should support disclosure in this bill.”
Indeed, with a history — most notably that of Senate Minority Leader Mitch McConnell (R-KY) — of supporting increased disclosure, and with the Supreme Court ruling eight-to-one in favor of increasing disclosure in the Citizens United case, the GOP had some re-framing to do.
“We can call this a DISCLOSE Act. I see this more as a ‘Restrict Act,’” said Rep. Gregg Harper (R-MS).
Perhaps most ardent in his theatrical language of the destruction that would supposedly be the result of this bill becoming law was Olson, as the Chamber of Commerce has much to lose from the legislation. He called it a “wholesale criminalization of speech… that is a certain path to tyranny.”
Similarly, there was a concerted effort to blur the lines between people and corporations.
Olson attempted to associate foreign companies with foreign-born citizens. The legislation would prohibit companies that have 20 percent or more foreign voting shares, a majority of foreign directors, or foreign nationals controlling U.S. operations of foreign-based corporations from spending money to influence our federal elections. Olson interpreted that to mean that “any person who might be of a different nationality” would be unable to exercise free speech and compared the legislation to the racial profiling law recently passed in Arizona.
“The question of what is a foreign-owned corporation is a fair question… and I’m happy to work with” people on that, said Rep. Michael Capuano (D-MI) in response to such criticism. “But the concept of simply publicizing who’s participating in our democracy” is not negotiable.
Insisting the legislation will have little or no impact on large corporations, Citizens United President David Bossie accused the Democratic authors of the legislation of intending for the end result to be “fewer people participating in elections.”
When Rep. Susan Davis (D-CA) asked the panel just how much disclosure they each thought was necessary to accurately portray the source of an ad, Olson said that disclosure should be equal, no matter if you’re a multi-national corporation or a person with a campaign sign in your lawn. He said making any distinction would be tantamount to the illegal restriction of speech based on speakers’ “wealth, point of view or special interest.”
“I’m not an attorney, thank God,” said Chairman Robert Brady (D-PA) to scattered laughter. “But I keep hearing ‘Congress shall make no law limiting the free speech…’ And I don’t think we’re doing that.” Brady said that all they were trying to accomplish is to make clear the origin of political speech, not silence it.
The plan was to pass the bill before the July 4 recess, but that schedule has been deemed “ambitious” by observers.
Still, the DISCLOSE Act is only a temporary stopgap. We need a Constitutional amendment to once again define the role of corporations in our society.
Movement is afoot to do just that, but with the glacial pace of Congress and the recent rash of fetishizing of the Constitution, it’s not going to happen before the 2010 election cycle is well over. Yet, in my opinion the constitutional amendments that have been introduced in the House and Senate don’t go as far as they could or should in reestablishing the fact that corporations should not have the same rights as citizens.
The DISCLOSE Act does not end the ruling doctrine of corporate personhood, which is what allowed Citizens United to happen in the first place. All it does is, well, disclose it. The hope is that this dose of sunlight might allow Americans to see corporate personhood for what it is: an unacceptable overreach by multi-national corporations into the heart of our republic.
However, considering the ridiculous and misleading rhetoric being utilized by the corporate right against this small improvement, disclosure may be the best we can hope for.
BUZZFLASH NEWS ANALYSIS
The DISCLOSE Act would do some pretty amazing things, the idea of which makes some policy wonks and election nerds drool. OMB Watch has a pretty extensive list of the bill’s provisions, which I’ve summarized here:
- A corporation’s CEO must appear on camera to say that he or she “approves this message.”
- The top funder of the ad will have to record a “stand-by-your-ad” disclaimer.
- The top five donors to an organization that purchases campaign-related TV advertising will be listed on the screen at the end of the message.
- If an organization spends more than $10,000 in a year on independent expenditures or electioneering communications, all donors who have given $1,000 or more to the organization during that period will have to be disclosed.
- Expenditures of $10,000 or more made more than 20 days before an election, and expenditures of $1,000 or more made within 20 days before an election, must be reported to the FEC within 24 hours.
- Donors may specify that a contribution may not be used for campaign-related activity.
- Corporations can establish a separate “Campaign-Related Activity” account to receive and disburse political expenditures.
- Federally registered lobbyists must disclose any election spending costing more than $1,000, as well as the name of the candidate or campaign supported or opposed.
- All campaign-related expenditures must be disclosed on an organization’s website with a link on the homepage within 24 hours of reporting the information to the FEC.
- Expenditures must also be disclosed to shareholders and members of the organization in periodic or annual financial reports.
- Political parties can spend unlimited amounts of their own funds in support of the party’s candidates, as long as a candidate or group of candidates does not “control” the spending.
- Corporations that receive federal contracts worth more than $50,000 may not spend money to influence federal elections.
- Companies that have received and not paid back funds from the federal Troubled Asset Relief Program (TARP) may not spend money to influence federal elections.
- Companies that have 20 percent foreign voting shares, a majority of foreign directors, or foreign nationals controlling U.S. operations of foreign-based corporations may not spend money to influence federal elections.
And there are a couple provisions in the Senate bill only:
- Senators would be required to file their campaign finance reports electronically to the FEC (House and presidential candidates have been doing so since 2001)
- If an organization spends $50,000 or more on airtime to run ads that support or oppose a candidate, the targeted candidate would be entitled to lower rates for broadcast ads.
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