Democracy 21 Refutes Challenge by Republican Senators to Proposed Obama Executive Order Requiring Government Contractors to Disclose Campaign Finance Activities
Statement of Democracy 21 President Fred Wertheimer
Last week, Senate Republican Leader Mitch McConnell (R-KY) and Senator Susan Collins (R-ME), joined by 25 of their Senate Republican colleagues, sent a letter to President Obama urging him not to issue a proposed Executive Order that would require government contractors to disclose their campaign finance activities to influence federal elections.
According to the letter, sent on April 26, 2011, the disclosures required by the Executive Order:
…could have a chilling effect on the First Amendment rights of individuals to contribute to the political causes or candidates of their choice. Political activity would obviously be chilled if prospective contractors have to fear that their livelihood could be threatened if the causes they support are disfavored by the Administration.
The arguments made in the letter ignore reality and reject more than three decades of Supreme Court decisions that have upheld the constitutionality of campaign finance disclosure laws against claims that disclosure requirements “chill” free speech.
The letter from Republican Senators ignores the fact that government contractors already are required to make a number of campaign finance disclosures. The Executive Order addresses gaping loopholes in existing campaign finance disclosure requirements that were created by the Citizen United decision allowing corporate and labor union expenditures in federal elections and by current FEC regulations that have eviscerated existing disclosure laws.
[The Democracy 21 legal team is representing Representative Chris Van Hollen (D-MD) in legal actions he brought last month to challenge the FEC disclosure regulations.]
Government contractors are already required to disclose the campaign contributions and expenditures made by their PACs and the individuals contributing to their PACS. They are also required to disclose the campaign expenditures they make directly on “independent expenditures” and “electioneering communications.” The contributions made by officers and directors of government contractors also have to be disclosed by their recipients.
What is missing however, and what the Executive Order would require is disclosure of the funds given by a government contractor to a third party group that are then spent by the third party group to influence federal elections. More than $135 million in secret contributions was spent in the 2010 congressional races through the use of such third party groups to mask the original source of the funds.
The Executive Order also would facilitate disclosure and make it easier for citizens to know what government contractors are doing to influence federal elections by providing all of the relevant campaign finance information in one centralized location. This information is necessary to guard against pay-to-play efforts involving decisions by the Executive Branch and actions by Members of Congress.
The Supreme Court in the landmark case of Buckley v. Valeo (1976) made clear that campaign finance disclosure laws are constitutional and necessary. The Court said in Buckley:
…disclosure requirements deter actual corruption and avoid the appearance of corruption by exposing large contributions and expenditures to the light of publicity.
Thirty-five years later in Citizens United, the Court reaffirmed the constitutionality and necessity of disclosure for the new campaign finance activities it permitted in striking down the ban on corporate expenditures in federal elections. The Court by an 8 to 1 majority held that disclosure requirements “do not prevent anyone from speaking,” and said:
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. Shareholders can determine whether their corporation’s political speech advances the corporation’s interest in making profits, and citizens can see whether elected officials are “‘in the pocket’ of so-called moneyed interests.”
…
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.
Justice Scalia made a forceful defense of disclosure in his concurring opinion in Doe v. Reed (2010), a case that upheld the disclosure of petition signers of ballot measures. Justice Scalia wrote:
Requiring people to stand up in public for their political acts fosters civic courage, without which democracy is doomed.
The American people, furthermore, overwhelmingly support disclosure of campaign activities by outside groups. According to a New York Times/CBS Poll last year (October 28, 2010):
92 percent of Americans said that it is important for the law to require
campaigns and outside spending groups to disclose how much money
they have raised, where the money came from and how it was used.
The letter from the Republican Senators asserts that the Executive Order “may be an effort to circumvent Congress.”
In fact, the Executive Order is an effort to provide the American people with important campaign finance information that citizens have a fundamental right to know and to “deter actual corruption and avoid the appearance of corruption,” as the Supreme Court stated in the Buckley decision.
This information would have been available not just for government contractors but for all groups, including corporations, labor unions, nonprofit advocacy groups and nonprofit business associations, if just one Republican Senator in the last Congress had supported campaign finance disclosure legislation, after the House passed the DISCLOSE Act.
Instead, unfortunately, Republican Senators joined together to successfully filibuster and block new disclosure legislation in the last Congress.
Thus, the Obama Administration is doing what it can do under its own authority to provide the American people with campaign finance information they are entitled to know.
Democracy 21 strongly supports the Obama Administration’s Executive Order.
Democracy 21 will continue to press for new campaign finance disclosure legislation in this Congress and will further pursue litigation and administrative efforts to ensure that full disclosure of campaign finance activities is available to the American people.
