Disclosed Partisanship
This article originally appeared in the June 7, 2010, issue of NR.


DISCLOSE’s partisanship is apparent in its different treatment of corporations and unions. Every major federal campaign-finance-reform effort since 1943 has attempted to treat corporations and unions equally. If a limit applied to corporations, it applied to unions; if unions could form PACs, corporations could too; and so on. DISCLOSE is the first major campaign-finance bill that has not taken this approach. For example, it prohibits corporations with government contracts of as little as $50,000 from making independent expenditures in elections or engaging in “electioneering communications.” This very low threshold would bar not only large contractors such as Boeing but also thousands of small businesses from exercising the rights recognized in Citizens United. Yet no parallel provision exists for unions that bargain with the government for multimillion-dollar benefit packages. Corporations that received TARP funds are prohibited from spending, but unions at those companies — which in many cases benefited far more from the bailouts than shareholders — are not.

Similarly, DISCLOSE prohibits U.S. corporations with as little as 20 percent foreign ownership from spending on elections, without placing parallel restrictions on unions (and despite the fact that a part of the Federal Election Campaign Act that was unaffected by Citizens United already prohibits spending in U.S. elections by foreign nationals and truly foreign companies). Thus Verizon Wireless, a New Jersey corporation with over 80,000 U.S. employees, is prohibited from making expenditures because the English corporation Vodafone has a minority stake in it. But the Service Employees International Union and the International Brotherhood of Electrical Workers are free to spend to their hearts’ content, even though they have foreign members and directors. (That’s what “International” stands for: SEIU has had members in Canada since 1943. IBEW has been organized in Canada since 1899, and is also in Panama and several Caribbean nations. Both have Canadians on their international executive committees.) Thus the provision not only discriminates against foreign nationals (in violation of the Constitution and countless federal statutes) — something few liberals would support in other contexts, such as limiting the right of foreign nationals to march in protest of government policies, write letters to the editor, or speak out on radio and television — but limits the rights of American shareholders to participate in the political system merely because they own property in association with foreign nationals.

Meanwhile, the disclosure provisions in the bill range from the duplicative to the patently absurd. Federal law already provides that any entity making an independent expenditure of more than $250 must file reports with the FEC that include the name of the spender, the date and amount of the expenditure, the candidate supported or opposed, and a statement that the communication was not coordinated with or authorized by the candidate. Additionally, the spender must disclose the name of any other entity that contributed funds for the communication. For “electioneering communications” — defined in current law as broadcast ads that mention a candidate and are aired within 30 days before a primary or 60 days before a general election — even more information is required, and contributors of $1,000 or more must be reported (although the reporting kicks in only once $10,000 has been spent). Additionally, “527” organizations, such as Swift Boat Veterans for Truth, must report all donors to the IRS, and political-action committees — a category including any group that spends over $1,000 and has as its major purpose influencing elections — must report all of their donors and expenditures to the FEC. Finally, current law requires all ads to include notice of who is paying for them.

Given this, it is obvious that DISCLOSE seeks less to enlighten the public than to bury would-be spenders in regulation and provide politicians with a means for intimidating their donors. DISCLOSE would require, for example, that an organization that makes independent expenditures disclose all of its members and donors contributing over $1,000. It extends this requirement even to an organization that has made no political expenditures in the current cycle but has done so in the past. It thereby provides politicians — in this year’s cycle, endangered Democratic incumbents – a weapon with which to threaten political opponents. The Supreme Court, in a 1958 case called NAACP v. Alabama, held that the government cannot compel groups to reveal their member lists and financial supporters. That may be why DISCLOSE allows groups to avoid such disclosure by establishing “campaign-related activity” accounts, essentially a new type of PAC funded by money solicited specifically to make independent expenditures. But this too runs afoul of the Court: One point of Citizens United was that the government could not require spenders to set up such additional accounts as a condition of political participation.


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