“Who’s Paying For What?”: The Flood Of Secret Campaign Cash Is Not All Citizens United
The emergence of nonprofits [1] as the leading conduit for anonymous spending in this year’s presidential campaign is often attributed to the Supreme Court’s 2010 Citizens United [2] ruling, which opened the money spigot, allowing corporations and unions to buy ads urging people to vote for or against specific candidates.
But a closer look [3] shows that there are several reasons that tens of millions of dollars of secret money are flooding this year’s campaign. Actions — and inaction — by both the Federal Election Commission and the Internal Revenue Service have contributed just as much to the flood of tens of millions of dollars of secret money into the 2012 campaign. Congress did not act on a bill that would have required disclosure after Citizens United and other court rulings opened the door to secret political spending.
To understand how all this happened, it’s worth returning to Justice Anthony Kennedy’s opinion [4] in Citizens United, and the political system the court envisioned. In the decision’s key finding, Kennedy and four other justices said the First Amendment entitled corporations and unions to the same unlimited rights of political speech and spending as any citizen.
But in a less-noticed portion of the ruling, Kennedy and seven of his colleagues upheld disclosure rules and emphasized the role of transparency. Undue corporate or union influence on elections, he wrote, could be addressed by informed voters and shareholders who would instantly access campaign finance facts from their laptops or smart phones.
“With the advent of the Internet,” Kennedy wrote, “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.”
If a company wasted money on politics, the justices agreed, its shareholders could use the publicly available information to “determine whether their corporation’s political speech advances the corporation’s interest in making profits.” Separately, the sunshine of public disclosure will let “citizens 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,” Kennedy concluded. “This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.”
A very different system has taken shape. As our reporting this week showed, money for political ads is pouring into non-profits ostensibly dedicated to promoting social welfare. These groups are paying for many of the negative ads clogging the airwaves, but are not disclosing their donors.
As a result, it’s entirely unclear whether these ads are being paid for by unions and corporations empowered by Citizens United or by wealthy individuals.
Separately, corporations have resisted calls [5] to list their donations to political social welfare nonprofits or other political spending. So far, the Securities and Exchange Commission has not responded to a rulemaking petition [6] asking for it to develop rules to require public companies to disclose that spending.
The Supreme Court’s opening of the door to hefty flows of secret money began years before Citizens United. In a 2007 case (PDF) [7] involving a nonprofit called Wisconsin Right to Life [8], the justices ruled that unions and corporations could buy ads that mentioned a candidate in the weeks before an election as long as the commercials stopped short of directly advocating the candidate’s election or defeat. Even if these ads, known as “electioneering communications,” clearly attacked the positions of one candidate, they were permissible unless they were “susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate.”
The flood began and the identities of hardly any of the donors were disclosed. The reason? A decision by the FEC, the oversight panel with three Republicans and three Democrats who frequently deadlock.
After Wisconsin Right to Life, the FEC told social welfare nonprofits that they had to disclose only if the donors specifically earmarked the money for political ads. “It proved to be the exception that swallowed the rule,” said Paul S. Ryan, general counsel of the Campaign Legal Center, a nonprofit, non-partisan group that tracks campaign finance. The day the FEC adopted this rule, Ryan wrote on his blog that it would allow massive amounts of secret money into politics. He proved correct.
In 2006, ads bought by groups that didn’t disclose their donors amounted to less than 2 percent of outside spending, excluding party committees, research by the Center for Responsive Politics [9] shows. By 2008, that number hit 25 percent; by 2010, more than 40 percent.
All of this raises an intriguing question: Was Kennedy aware when he drafted the January 2010 Citizens United opinion that nonprofits were being widely used to avoid public disclosure of political spending?
At the least, critics say, Kennedy was poorly informed.
“Justice Kennedy was living in a fantasy land,” said Ciara Torres-Spelliscy, a professor at Stetson University College of Law who tracks campaign finance issues. “I wish the world he envisaged exists. It doesn’t.”
Instead, this is the disclosure world that exists: Someone who gives up to $2,500 to the campaign of President Barack Obama or challenger Mitt Romney will have his or her name, address and profession listed on the FEC website for all to see. But that same person can give $1 million or more to a social welfare group that buys ads supporting or attacking those same candidates and stay anonymous.
This year, a federal judge struck down the FEC rule stemming from Wisconsin Right to Life. The FEC announced in July that major donors to electioneering communications — ads that focus on issues without directly advocating for candidates — would have to be named.
Already, groups are looking for work-arounds. They’re running different kinds of ads. Some will name other social welfare nonprofits as their donors.
The loose oversight by the FEC helped bring so much anonymous money into campaign finance. But no one expects the commission to take a more assertive role anytime soon. Dan Backer, a lawyer who represents several conservative nonprofits, likened the deadlocked agency to a “cute bunny” while referring to the IRS as a “500-pound gorilla.”
The IRS or Congress are more plausible avenues for change, experts say. Ryan said he was hopeful that Congress and the IRS might some day limit ads from groups that don’t disclose their donors. The 2012 campaign, though, appears to be a lost cause. “I think this election will be mired and perhaps overwhelmed by secret money,” Ryan said.
By: Stephen Engelberg and Kim Barker, ProPublica, August 23, 2012
“Reeking Of Politics”: Class War At The Supreme Court
On the eve of the Supreme Court’s much anticipated ruling on Obamacare, here is a simple test for detecting the politics behind a decision: When reading the rulings, look for the double standards and answers to questions not posed by the cases themselves. By those measures, the Supreme Court’s record in the past week fairly reeks of the justices’ politics.
Exhibit A is Justice Samuel Alito’s majority opinion in Knox v. Service Employees International Union, Local 1000, in which nonunion California state employees whose wages and benefits were nonetheless set through the collective bargaining process of SEIU — the state’s largest union — sued the local to get back a special dues assessment it levied in 2005 to fight two ballot measures. The union’s normal practice was to allow nonmembers to opt out of paying the roughly 44 percent of dues that went to matters not directly related to collective bargaining, such as election campaigns. In this instance, however, no such opt-out was allowed.
The issue before the court was whether mandating the collection of the special assessment from nonmembers violated their constitutional rights to free speech. Alito and the four other conservative justices ruled that it did, and liberal Justices Sonia Sotomayor and Ruth Bader Ginsburg agreed in a concurring opinion. But Alito’s opinion didn’t stop there. It also changed the long-standing practice of allowing nonmembers to opt out of paying dues toward union functions outside collective bargaining, mandating instead that the unions “may not exact any funds from nonmembers without their affirmative consent.” In other words, unions would have to ask for nonmembers’ permission to collect political assessments and, possibly, any dues at all. “Individuals should not be compelled to subsidize private groups or private speech,” Alito wrote.
Alito’s ruling struck at the heart of American unionism. By laying the groundwork for creating a right for nonmembers to avoid dues payments, he came close to nationalizing the right-to-work laws that 23 states have adopted (though 27 have not). As Sotomayor noted in a somewhat astonished dissent (Ginsburg and Justices Stephen Breyer and Elena Kagan dissented on this point as well), this wasn’t the question before the court. Neither side had argued that issue in their briefs or oral presentations. “The majority announces its novel rule,” Sotomayor wrote, “without any analysis of potential countervailing arguments.” And it did so in defiance of the court’s own Rule 14, which states that “only the questions set out in the petition or fairly included therein will be considered by the Court.”
Taken in context with the conservative majority’s other recent rulings, Alito’s opinion also revealed the most class-based double standard the court has exhibited since before the New Deal. In the 2010 case Citizens United v. Federal Election Commission — rendered by the same five justices who signed onto Alito’s ruling in Knox — the court ruled that corporations could directly spend their resources on political campaigns. These two decisions mean that a person who goes to work for the unionized Acme Widget Company can refuse to pay for the union’s intervention in political campaigns but has no recourse to reclaim the value of his labor that Acme reaps and opts to spend on political campaigns. Citizens United created a legal parity between companies and unions — both are free to dip into their treasuries for political activities — but Knox creates a legal disparity between them: a worker’s free-speech right entitles him to withhold funds from union campaign and lobbying activities, but not the value of his work from the company’s similar endeavors.
If you seek a precedent for this anomaly, might I suggest the following sentiment on unions written (not in a court ruling, mind you) by former president William Howard Taft in 1922, when he was chief justice: “That faction we have to hit every little while.” That’s the “legal” tradition to which Alito adhered: fear and loathing of workers’ organizations.
The club champion for double standards, however, is not Alito but Antonin Scalia. Dissenting from this week’s decision striking down major provisions in Arizona’s anti-immigrant law, he argued that Arizona has the sovereign rights of a nation in protecting its borders — a right he gleans through such a bizarre reading of the Constitution that not one of his fellow conservatives signed on to his dissent. Yet the same day, Scalia signed on to a Gang of Five decision declining to hear Montana’s case that its century-old law banning corporate contributions to political campaigns should take precedence over Citizens United. In the world according to Nino, Arizona has the rights of a nation-state, but Montana must submit to the Gang of Five. You’re sovereign when Scalia agrees with you; you’re nothing when he doesn’t.
Politics? Heaven forfend!
By: Harold Meyerson, Opinion Writer, The Washington Post, June 26, 2012
“Unfriendlies In The Working Class”: Why Did So Many Workers Vote For Scott Walker?
The results of the Wisconsin recall election were very similar to the first run of this matchup in November 2010, when Scott Walker beat Tom Barrett. This means that the radical right agenda of the GOPers elected in 2010 has not turned off the voters.
How can a government of the 1% receive so much support from the 99%?
In the case of the Wisconsin election, there’s been a lot of finger pointing and speculation post-election: Walker used loose campaign finance rules to overwhelm Barrett financially; Obama didn’t come to Wisconsin; unions didn’t force the collective bargaining issue front and center. And so on.
Yet pre-election polling and Election Day exit polling showed that the vast majority of voters had taken their positions months before the serious campaigning. So, the money and the celebrities made little difference. And people were already as informed on the issues as they wanted to be.
The fact is the radical right is very good at propaganda. They have used race and cultural issues to hold their base and they have used anti-government rhetoric in an era of frustrated economic hopes and resentment to expand that base to majority status.
Walker, even more so than in 2010, ran against Milwaukee and Madison.
His negative ads against Milwaukee Mayor Barrett were actually negative ads against the mayor’s city, equating it with high unemployment, rising property taxes, crime, and poverty. This is the tried-and-true GOP race card because everybody knows Milwaukee has a substantial population of dark-skinned people.
And Madison, of course, is the state capital where privileged bureaucrats earn too much, enjoy too rich benefits, and do too little work.
Walker did not dream up this argument. Even before the 2010 election, on-the-ground research from a University of Wisconsin professor showed that ordinary Wisconsinites outside of Madison had a very negative view of this city of large government office buildings, a fairly high standard of living, and liberal politics. Walker simply exploited an existing bias.
Exit polling showed Walker won the votes of a majority of non-college graduates, along with way too many union households (around 38 percent) in both 2010 and 2012.
Meanwhile, college graduates—the ever-shrinking middle-income households—and the very poor did not vote for Walker.
In other words, way too much of the working class voted for Walker.
We progressive labor people might smugly shake our heads and ask, how can these people vote against their own interests? While some of them are serious cultural conservatives or racists, probably a majority legitimately see themselves as actually voting in their own self interest.
People struggling to get by on $12-15 an hour have to watch every penny. And the Republican message of small government and low taxes resonates every time a worker pays sales tax, property tax, or income tax.
And thanks in part to a gullible or lazy media which dutifully and uncritically repeats GOP propaganda about the eventual demise of Social Security and Medicare, struggling workers have a jaundiced view of their payroll taxes. The Republicans, with their expensive wars and tax giveaways for the wealthy, are certainly not the party of small government and fiscal responsibility, but they have sold their message well.
If progressives hope to regain governing power, they have to win back the “unfriendlies” in the working class, as Mike Amato correctly points out. They might not be able to garner the support of the devoted racists and cultural conservatives, but they can and must win the loyalty of the others.
We can get started right away with the issue of taxes. Not by promising tax cuts, but rather tax fairness. At every level of government in the United States our tax structure is one of the most regressive in the world.
Obama, to his credit, has made some effort to address this by calling for the Buffet rule, which would lift taxes on millionaires, and an end to the Bush tax cuts for the super rich. Meanwhile, Bill Clinton (who I can now publicly admit I could never bring myself to vote for) undermines this push by giving the Republican argument that rolling back these tax cuts would hurt the economy.
As usual, Democrats do not seem to have a coherent and consistent philosophy on matters of important public policy. Nor do they appear to have a plan beyond the next election.
The Republicans clearly do.
Unions and other progressives must push the Democrats or some other vehicle to pursue a coherent and consistent pro-working class agenda, or we will continue to be governed by Walker types and to wring our hands over this state of affairs.
By: Jim Cavanaugh, Labor Notes, June 8, 2012
“A Movement Determined To Right A Wrong”: Wisconsin Gives Progressives Something To Build On
On Tuesday, all eyes will be watching to see whether Wisconsin voters will keep labor-bashing right-winger Scott Walker (R) in the governor’s mansion. But win or lose, the real story is the 15 months of people power leading up to this day. The real lesson lies in more than a year of progressive organizing, petitioning, canvassing and campaigning for the cause. The real result is a progressive movement that is deeper and broader than before.
When Walker’s opponents needed 540,208 signatures to trigger the recall election, Wisconsin’s progressives responded by collecting more than a million. They filled 152,000 pages — weighty evidence of the power of a group of people determined to right a wrong.
And the effects have rippled outward. The sight of 70,000 protesters — teachers, firefighters, nurses, students, parents with children – occupying the Wisconsin State Capitol in February 2011 ignited activists around the country. Just as the uprisings in Tunisia and Egypt motivated people around the world, including in Wisconsin, the occupation of the Madison statehouse helped inspire the occupation of Wall Street a few months later.
Let me state the obvious: I want the recall to succeed. A victory for Democrat Tom Barrett would not only create an opportunity to roll back Walker’s worst anti-labor, budget-slashing measures, but would also send a clear message to those who are masquerading as deficit hawks around the country: We’ve had it with starve-the-beast politics. We’re done with leaders whose idea of austerity is to cut education, health care and vital public services in order to give more tax breaks to their millionaire friends.
Walker’s GOP legislature, like so many Republican statehouses around the country, has pursued a “divide and conquer” strategy, as Walker himself admitted to a billionaire donor. His legislative efforts, backed up by the Koch brothers’ Americans for Prosperity, and the extremist, corporate-funded group American Legislative Exchange Council (ALEC), are meant to cripple labor unions and disenfranchise poor and minority voters.
Make no mistake — Walker knows his recall has the potential to be a resounding progressive victory. That’s why he’s raised $31 million to stay in office, compared with $4 million raised by his opponent. Two-thirds of Walker’s money has come from outside Wisconsin, and his donor list reads like a list of Who’s Who of America’s Billionaires. Sheldon Adelson — Gingrich’s Daddy Warbucks — and Amway founder Richard DeVos have each given Walker $250,000. And remember the “Swift boat” ads against Kerry? Houston home builder Bob Perry, who backed that smear campaign, wrote Walker checks totaling $500,000. As the recall fight comes to an end, this record amount of money from ultraconservative outsiders has kept Walker alive.
Money in politics is nothing new. In 1816, Thomas Jefferson lamented that corporations that “challenge our government to a trial of strength” were undermining the will of the people. But the battle lines have radically shifted. Ever since the Citizens United ruling welcomed unrestricted corporate money into our elections, the interests of the 99 percent have been badly outmatched by anonymously sourced dollars.
Indeed, we are witnessing the first major battle between astronomical numbers of people and astronomical amounts of money.
As I write this, Walker leads in the polls, and if progressive turnout is merely ordinary, he will likely win. On the other hand, if we see the same groundswell today as on the days that led to this one, Walker can be defeated. Yet, big as this election is, it is only the first test of the progressive response to an electoral landscape overrun with money from corporations and wealthy individuals.
By attacking labor unions, flooding Wisconsin with outside cash and trying to cleanse the electorate of people who don’t look, earn or think like him, Walker has taken aim at more than a single campaign cycle or a series of policies; his real targets are the pillars of American progressivism itself. With the Romney campaign gearing up, and super PACs taking to the national airwaves, we face an unprecedented, well-funded assault on our basic values.
But progressives aren’t backing down. They’re just getting started.
So when the results come in, reflect on the vast organizing effort that brought Wisconsin to this moment — and imagine where it still has the potential to go. Elections are over in a matter of hours, but movements are made of weeks, months and years. The Declaration of Sentiments was issued at Seneca Falls in 1848, yet women did not gain the right to vote until seven decades later. The Civil War ended with a Union victory in 1865, yet the Voting Rights Act was not passed until a century later. Auto workers held the historic Flint sit-down strike in 1936-37, yet the fight for a fair, unionized workforce persists 75 years later.
And in the last 15 months, Wisconsin’s progressives have shown us that the battle against bankrolled austerity can be bravely waged by an army of dedicated people committed to protecting working families. They’ve reminded us that good organizing is our only chance to withstand the blitzkrieg of corporate funded advertising — and better yet, leave a lasting mark. Their movement, with thousands of new Wisconsin activists mobilized, energized and educated, can be permanent — and it can keep growing.
By: Katrina vanden Heuvel, Opinion Writer, The Washington Post, June 4, 2012
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