Grassroots activism needed to shine light on "dark money' in political fundraising

Written by Guest on May 20, 2014

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(This post was published as a guest column in the Cambridge Chronicle, click here.)

Four years after the Supreme Court majority in Citizens United v. FEC promised unlimited political fundraising posed no risks of corruption as long as the donors are disclosed, the 2014 election is shaping up to have the most undisclosed money ever. And with Congress tied in knots on nearly every policy issue, we shouldn't hold our breath for a legislative fix to shine a light on this "dark money."

It wasn't too long ago that "transparency" and "disclosure" in political fundraising were rallying cries from Republicans. In 1987, Senate Minority leader Mitch McConnell supported disclosure.

He continued in this vein, as did the other members of the Republican Party up until 2010. Similar themes were articulated in the infamous Citizens United decision written by Justice Kennedy that has resulted in a new wave of undisclosed political fundraising:

"With the advent of the Internet, prompt disclosure of expenditures can provide shareholders and citizens with the information needed to hold corporations and elected officials accountable for their positions and supporters."

It was felt that money in politics was not a problem as long as people know where the money came from. The power of this knowledge was demonstrated by the uproar when the Target Corporation was found in 2010 to be contributing to a gubernatorial candidate who opposed civil rights for LGBT people.

In the years since the Citizens United decision, the Republicans have changed their tune "sound familiar, the individual mandate in Obamacare was originally a Republican idea. They have successfully opposed the DISCLOSE Act at the federal level and are unenthusiastic about similar legislation at the state level.

But even with the legislative route closed, there are still options available for those of us who value transparency in the funding of our political campaigns. The first covers all donors; the second just covers corporations.

According to the Common Cause campaign "Entitled to know":

Section 317 of the Communications Act requires on-air identification of the sponsors of all advertisements, political as well as commercial. Explaining the rules it wrote to implement the statute, the FCC stipulated years ago that political ads must "fully and fairly disclose the true identity of the person or persons, or corporation, committee, association or other unincorporated group, or other entity" paying for them. "Listeners are entitled to know by whom they are being persuaded," the commission said.

Unfortunately, this rule is not properly enforced as the commission allows the publisher of the advertisement to be the advertiser of record and allows the donors to hide behind this fa̤ade. It is important that the FCC remove this loophole and provide true transparency for political advertisements so that, in the words of the legislation we "know by whom we are being persuaded."

The second route is to bring the treatment of corporations and unions into alignment. Since the Supreme Court's decision in Beck v. Communication Workers of America (1988), unions have had to rely on "voluntary" contributions from members to fund their political activities. In that case, the Supreme Court ruled that unions could only legally collect fees to cover their administrative and collective bargaining expenses; thus, members could opt out of paying any additional dues that were used for political activities.

The equivalent constraint for a corporation would be for shareholders to have the right to control corporate political activity. Such constraints might be imposed in two ways. First, the shareholders as a body might be required by the Securities and Exchange Commission to vote on the next year's political activity budget and on broad lines on the issues on which it is to be expended. Given the lethargic shareholder governance that currently exists, this would leave the decisions on political expenditure where it is today: in the hands of top management.

The second approach would be to give each shareholder the right to "opt out" of making a contribution to political activity. He or she could request that her/his proportion of the political budget be redirected to charity instead of being used for political activity. Alternatively, the individual shareholder could direct to which politician(s) his or her share of the political budget was to be directed. Equitable treatment of unions and corporations requires that one or other of these systems to constrain corporate spending be incorporated as quickly as possible. If the SEC cannot be persuaded to constrain corporate political speech, it should at the very least require firms to disclose what they have spent and said.

Of course, bringing change in FCC or SEC rules will not be easy. There are powerful and moneyed vested interests that will oppose such plans. Only widespread grassroots activism can overcome this resistance.

Martin Evans is on the governing board of Common Cause Massachusetts.

Office: Common Cause National, Common Cause Massachusetts

Issues: Money in Politics, Money in Politics

Tags: Democracy Amendment , Citizens United

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