Citizens United, the 2010 ruling that famously led President Obama to wag a disapproving finger at the Supreme Court during his State of the Union address, held that businesses have a right to engage in political campaigning. Although the decision applied equally to unions and nonprofits, Democrats feared that the effect would be to damage their party’s electoral prospects. In response, the heads of the Democratic House and Senate congressional campaign committees hurriedly introduced legislation that they hoped would “fix” Citizens United by discouraging, and in some cases prohibiting, businesses from using their newfound rights.
The Disclose Act, as the legislation was called, ultimately failed to pass Congress in the face of unanimous Republican opposition.
Following that failure, Obama began to talk of a draft executive order that, when combined with regulations, would achieve much of what had failed to pass Congress. Democratic commissioners on the Federal Election Commission also worked unsuccessfully to pass the Disclose Act through regulatory fiat.
The latest effort to end-run Citizens United is the so-called Shareholder Protection Act of 2011. Ostensibly, this legislation, if passed, would provide shareholders in corporations knowledge and potentially the right to vote on corporate political spending.
Although supporters have promoted this idea as encouraging transparency, in fact the goal seems to be to stifle political speech by causing corporations to distance themselves from politically sensitive issues and candidates, and by creating administrative barriers to the efficient operation of the corporation.
To many, the effort to make certain that shareholders are specifically aware of corporate political spending sounds logical at first blush. However, if this kind of information were really useful to shareholders, shouldn’t corporations also provide such information regarding other kinds of donations?
Why, for example, isn’t there a similar push to inform shareholders about how and where a company is giving to charities or the arts?
A 2009 Time magazine article revealed corporate giving for some well-known American businesses. One household name was listed as giving 5 percent of its pretax profits — $3 million a week at that time — to local and national charities such as the Pacific Symphony.
Most can support that kind of giving to an entity as culturally enriching as a symphony. But what about corporate donations that go to museums such as Northwestern University’s Block Museum on Chicago’s North Shore?
Do shareholders need to know that the same year Time magazine was publishing information about corporate arts and humanities giving, the Block Museum held a months-long exhibit of photographs by the controversial artist Robert Mapplethorpe?
What about Brooklyn’s Saatchi Gallery, where Chris Ofili’s elephant dung Madonna had then-Mayor Rudy Giuliani incensed enough in the late 1990s to declare that it was an “aggressive, vicious, disgusting attack on religion.”
Do companies that give to that gallery need to inform shareholders that they are using corporate funds to help ensure that these museums keep doing what they’re doing?
Corporate giving has always been at the discretion of the company and most information regarding giving — particularly political giving — is already available online. Unless corporations are willing to put all their charitable giving up to a shareholder vote, the Shareholder Protection Act of 2011 continues to look like a thinly veiled attempt to control corporate giving along ideological lines.
Bradley Smith is the founder of the Center for Competitive Politics and a former member of the Federal Election Commission.
