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A Corporate Full-Body Scan

Posted by Philip Mattera on February 2nd, 2010

Originally posted on January 28 at Dirt Diggers Digest.

The one redeeming feature of the abominable Supreme Court ruling on corporate electoral expenditures is the majority’s retention of the rules on disclaimers and disclosure. While opening the floodgates to unlimited business political spending, the Court at least recognizes that the public has a right to know when a corporation is responsible for a particular message and a right to information on a corporation’s overall spending.

Writing for the majority, Justice Kennedy states: “The First Amendment protects political speech; and disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way. This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.”

There’s no question that steps must be taken to mitigate the Citizens United ruling, whether through changes in corporation law, shareholder pressure, enhanced public financing of elections, or even a Constitutional amendment.

Yet while these efforts progress, it is also worth taking advantage of the Court’s affirmation of the principle of transparency and push for even greater disclosure than what we have now. Groups such as the Sunlight Foundation are already moving in this direction.

The effort could begin with pressing the Federal Election Commission to tighten the existing reporting rules on what are known as “electioneering communications” and to enforce them more diligently.  But that’s not enough.

In the wake of Citizens United, we’ve got to demand more information on the many ways corporations exercise undue influence not only on elections but also on legislation, policymaking and public discourse in general. Now that Big Business is a much bigger threat to popular democracy, we have to subject corporations to intensive full-body scans to find all their hidden weapons of persuasion. The following are some of the areas to consider.

Lobbying. In his State of the Union Address, President Obama said that lobbyists should be required to disclose every contact with the executive branch or Congress. That’s fine, but why stop there? Many corporations do their lobbying indirectly, through trade associations which disclose little about their sources of funding. How about rules that require those associations to disclose the fees paid by each of their members and require publicly traded companies to disclose exactly how much they pay to belong to each of their various associations?

Front Groups. Corporations also indirectly seek to influence legislation and public opinion by bankrolling purportedly independent non-profit advocacy groups. Such front groups—such as those taking money from fossil-fuel energy producers to deny the reality of the climate crisis—do not have to publicly disclose their contributor lists. Why not require publicly traded companies, at least, to reveal all of their payments to such organizations?

Union-Busting. Encouragement of collective bargaining is still, in theory, official federal policy. Yet many companies violate the principle—and the rights of their workers—by using corporate funds to undermine union organizing campaigns. The existing rules on the disclosure of expenditures on anti-union “consultants” are too narrow and not vigorously enforced. That should change.

These are only a few of the ways that undue political influence and other forms of anti-social corporate behavior could be addressed through better disclosure. Yet, as we’ve seen, transparency by itself does not counteract corporate power unless something is done with the information.

This came to mind in reading the last portion of the Citizens United ruling. Not all five Justices in the majority went along with the idea of maintaining the disclaimer and disclosure rules. Parting with Kennedy, Roberts, Scalia and Alito, Justice Thomas argued not only that corporate independent expenditures should be unrestricted, but also that they should be allowed to take place under a veil of secrecy.

He bases his argument not on legal precedent, but rather on dubious anecdotal evidence that some supporters of California’s anti-gay-marriage Proposition 8 were subjected to threats of violence after their names appeared on public donor lists. Thomas thus suggests that corporations should be able to make their political expenditures anonymously to avoid retaliation.

While I am in no way advocating violence, I think activists need to use the information that becomes public as the result of expanded disclosure to make corporations pay a price for any attempts to buy our political system. If we can get them to worry about (non-violent) retaliation to the point that they limit their expenditures, then we will have gone a long way toward neutralizing the pernicious effects of the Citizens United ruling.




Posted in Money & Politics


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