Sunlight Is Still Best Disinfectant for Politics: Albert Hunt

The U.S. senator forcefully advocated full and “real” disclosure of campaign contributions, questioning, “why would a little disclosure be better than a lot of disclosure?”

This wasn’t John McCain or Russ Feingold, the architects of recent efforts to overhaul U.S. campaign-finance laws; it was Kentucky Republican Mitch McConnell, in response to a question from Tim Russert on NBC’s “Meet the Press” 10 years ago.

McConnell has been the leading foe of McCain and Feingold over the years. He has lost in the legislative chamber, while winning more in the courts, particularly since John Roberts became chief justice of the United States five years ago.

The latest, and most stinging, judicial setback for a campaign-finance overhaul was this year, when the court, in the Citizens United case, ruled that corporate money can be spent directly to support political candidates. Critics, and many detached observers, believe the 5-4 decision will significantly increase the influence of special-interest money in federal elections.

This wasn’t a partisan response. Republicans such as former Supreme Court Justice Sandra Day O’Connor and Maine Senator Olympia Snowe had worried about the insidious danger that Roberts and the court’s conservative majority created with this decision, overturning years of laws.

Forcing Disclosure

Democrats Chris Van Hollen, a House leader from Maryland, and Senator Chuck Schumer of New York are trying to minimize these effects with a bill that would force full disclosure of these activities and try to crack down on a few other loopholes the Roberts court opened.

The push to re-establish disclosure requirements was endorsed by President Barack Obama in his weekly radio address May 1. “What we are facing is no less than a potential corporate takeover of our elections,” he said.

The Mitch McConnells and the corporate supporters of no rules on campaign spending have been contemptuous of the disclosure initiatives that many of them, while trying to fend off contribution and spending limits, once cited as the only reform needed in campaign laws.

Organizations, including corporations, labor unions and nonprofits, would have to disclose to the Federal Election Commission and the public any campaign-related expenditures or transfer of funds for the purpose of making campaign expenditures to other groups within 24 hours. Thus, vested interests couldn’t surreptitiously use an umbrella group such as the Chamber of Commerce to support or oppose a candidate.

Approving the Message

Moreover, the head of the organization making a campaign- related expenditure would have to certify that he or she “approves” the message. And it would have to be fully reported to shareholders or members on the organization’s website.

The Van Hollen-Schumer measure extends beyond disclosure. One provision would ban any U.S. corporation that is owned or controlled by a foreign entity from making campaign-related expenditures. Foreign corporations have long been barred from such activity, but the court’s Citizens United decision opened up a loophole here.

Supporters say it would preclude organizations such as Citgo Petroleum Corp., the oil company controlled by the government of Venezuelan President Hugo Chavez, from influencing U.S. elections. It would also put foreign-owned U.S. subsidiaries such as Budweiser-brewer Anheuser-Busch Cos., T- Mobile USA Inc. and Research in Motion Ltd. (RIM) at a competitive disadvantage, though they could still participate through their political-action committees.

Excluding TARP Recipients

And the initiative would prohibit any company receiving funds from Treasury’s Troubled Asset Relief Program or with government contracts in excess of $50,000 from making campaign- related expenditures. Legal experts say this provision may run into constitutional hurdles before the current court; Van Hollen says the provisions of the bill are “severable,” meaning if one is thrown out, the others still would take effect.

However, the general concept of disclosure was endorsed by the Roberts court. “Disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way,” the court declared in its opinion. “This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.”

Yet few Republicans have rushed to embrace Van Hollen- Schumer; quite the contrary. Among the party’s lawmakers, the bill has attracted support from House members Mike Castle of Delaware and Walter Jones of North Carolina, and so far none in the Senate.

Hijacking Playing Field

The U.S. Chamber of Commerce, which plans to spend north of $50 million on this year’s congressional elections, has blasted the Schumer-Van Hollen effort. Thomas Donohue, the trade group’s president, says the bill “is nothing more than a thinly veiled attempt to hijack the political playing field” to aid Democrats in November.

Donohue declined an interview request to elaborate. It will be interesting to hear why he believes fuller disclosure -- for unions and corporations as well as nonprofits -- helps one side. The Supreme Court, in the Citizens United case, did say disclosure requirements might be thrown out if there is a “reasonable probability” that contributors will be subject to “threats, harassment, or reprisals.” Major corporate and labor interests can take care of themselves.

What is vital to any legislation, says Anthony Corrado, a campaign-finance expert and professor at Colby College in Waterville, Maine, is to ensure that companies or unions can’t disguise efforts to help or hurt candidates by using front groups.

Stonewalling In Senate

“It’s important to get disclosure of the first resort,” says Corrado, who is less enthusiastic about some of the non- disclosure provisions in the Van Hollen-Schumer proposal.

Van Hollen is optimistic the measure can clear the House by early summer, in time for the midterm elections. It’s a tougher slog in the Senate. McCain, who for the past decade would have been leading the charge, is hiding, fearful of his tough conservative primary challenge in August.

It will be up to disclosure advocates such as Maine Republican Senators Snowe and Susan Collins to buck McConnell’s likely efforts to block this measure.

Van Hollen says the bill is predicated on the late Supreme Court Justice Louis Brandeis’s observation that “sunlight” is “the best of disinfectants”: “If you’re not afraid of sunlight, transparency and accountability, you’re not afraid of this bill,” Van Hollen says.

Congressional Republicans, salivating over expected huge gains in November, have already miscalculated by futilely trying to sidetrack a financial-regulation overhaul. Those prospects would dim if they now decide to fight sunlight.

(Albert R. Hunt is the executive editor for Washington at Bloomberg News. The opinions expressed are his own.)

To contact the writer of this column: Albert R. Hunt in Washington at ahunt1@bloomberg.net.

To contact the editor responsible for this column: Max Berley at mberley@bloomberg.net.

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