Full Disclosure

by Norman Ornstein | May 7, 2011

When a divided Supreme Court issued its highly controversial Citizens United decision allowing corporations free rein to use their dollars to intervene in elections, there was one seemingly shining light, an area where broad consensus existed and that was endorsed by eight of the nine justices: the value of disclosure. The Court stated in the decision, “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 author of the Citizens United decision, Anthony Kennedy, speaking for the Court, underscored the point: “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.”

At last, a venue for common ground! After all, even opponents of campaign reform had long emphasized their deep fealty to disclosure. In March of 2000, a Wall Street Journal editorial said, “Our view is that the Constitution allows consenting adults to give as much as they want to whomever they want, subject to disclosure on the Internet.” That same year, Republican Senator Mitch McConnell asked, “Why would a little disclosure be better than a lot of disclosure?” As recently as 2007, John Boehner said on “Meet the Press,” “I think what we ought to do is we ought to have full disclosure, full disclosure of all the money that we raise and how it is spent. And I think sunlight is the best disinfectant.” And the public resoundingly agrees: In an October 2010 CBS/New York Times poll, 92 percent of Americans said it is important for the law to require campaigns and outside spending groups to disclose how much money they have raised, where the money comes from, and how it was used.

Yet, since the Citizens United decision, the once-unifying disclosure issue has degenerated into another divisive set of battles, as long-time conservative proponents of disclosure have changed their positions so dramatically they could be treated for whiplash. Why has this happened—and can anything be done to fix it?

 

The 2010 mid-term elections showed clearly how legal loopholes involving non-profit groups called 501(c)4s, and the failure to adopt clear regulations surrounding campaigns, can result in hundreds of millions of dollars of spending to influence campaigns that masked the identity of huge donors. In response to these realities, the Federal Communications Commission is considering requiring robust disclosure by TV stations of the major donors of political ads; the Securities and Exchange Commission is considering requiring public corporations to disclose to stockholders their spending on politics, and the White House has drafted an executive order to require companies applying for federal contracts to disclose their spending on political campaigns. Given the strong position of the Supreme Court in Citizens United, the longtime consensus among political figures, and the overwhelming preference of voters, one might think that the Federal Election Commission (FEC) would have moved to implement regulations to strengthen disclosure, and that politicians and others would applaud the recent moves by the government to strengthen disclosure through the administrative process. To the contrary, however, things have gone horribly wrong.

Last month, Mitch McConnell now says he views disclosure as “a cynical effort to muzzle critics of this administration and its allies in Congress.” He savaged the White House for considering an executive order to require corporations getting federal contracts to disclose its corporate spending on campaigns, saying, “Now, under the guise of ‘transparency,’ the Obama administration apparently wants to know the political leanings of any company or small business, including those of its officers and directors, before the government decides if they’ll award them federal contracts.” What’s more, last fall, McConnell pulled out all the stops to prevent passage of the DISCLOSE Act, which would have required all corporations and unions to disclose their campaign spending. McConnell managed to pressure every Republican from supporting cloture, leaving the legislation, which had passed the House, stuck at 59 votes in the Senate.

The Wall Street Journal’s full-throated support for transparency has disappeared as well; it blasted the FCC recently for considering requiring TV stations to put donors of campaign spots on the Internet, writing, “The goal here is to use ‘transparency’ to intimidate businesses out of making political donations. Disclosure sounds good, but liberals have begun to wield it as a weapon to vilify business donors.” Critically, the Journal’s editorial reflects a larger point: Opponents of any regulation of campaigns have not only abandoned their longstanding support for transparency, they are also trying to create a new attack line that identifies disclosure as a muzzle, a way to stifle speech.

The opponents of any regulation or restraint of any sort on campaign spending also include the three Republican commissioners of the FEC. Their leader, Donald S. McGahn, recently wrote self-righteously that he is free to ignore acts of Congress because, “As an FEC Commissioner, I am bound by my oath to follow controlling precedent of the Supreme Court.” But McGahn and his Stepford colleagues have consistently ignored the 8-1 precedent of the Court and moved to dilute or block any meaningful disclosure.

What to make of the turn away from support for disclosure? I can draw only one conclusion: The earlier support for disclosure was a façade. McConnell, McGahn, and the Journal, among others,don’t actually want transparency or any regulation. At base, they are for a wholly unregulated, Gilded Age-style campaign system where big and secret money rules.

The motives and potential actions of the FCC, SEC, and White House remain under intense assault. Republican Representative Greg Walden, chairman of the House Telecommunications subcommittee, threatened to “go nuclear” if the FCC even tried to implement disclosure of political ad sponsors by TV stations, and McConnell and his allies are talking lawsuits and retaliation if the White House moves on its executive order. On the flip side, however, there is momentum to keep the push for disclosure alive. Notably, Democratic Representative Chris Van Hollen has sued the FEC to require disclosure of donors.

The key now is for theWhite House and the regulatory agencies to ignore the threats from Congress and elsewhere, and move ahead with their efforts. After all, the sentiments of the 92 percent of the public that favors transparency, and the eight justices on the Supreme Court that have endorsed it, should outweigh the objections of the reborn anti-disclosure cabal.

Norman Ornstein is a fellow at the American Enterprise Institute and the author, in 2006, of The Broken Branch: How Congress Is Failing America and How to Get It Back on Track, with Thomas E. Mann

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