Underwhelmed by shareholder regulation proposals

As the DISCLOSE Act siren song wails its last, let us not forget the other “reform” proposal made in the wake of Citizens United: shareholder democracy!

No less than the Harvard Law Review has released articles written about Citizens United v. Federal Election Commission, corporations, political speech and other related stuff. Eager to broaden my horizons, I took a look at the article by Lucian A. Bebchuck and Robert J. Jackson, Jr. Bebchuk is kind of a big deal corporate law professor at Harvard. Jackson is at Columbia, a graduate of Harvard Law, and apparently no relation to Robert H. Jackson. Overall, the authors argue that the law should impose special rules governing who gets to decide whether, and what, the corporation should say about politics. They prefer special rules to the default rule, which is that, as with ordinary business decisions, the directors and executives have authority to make political spending decisions.

I am underwhelmed. Not by the overall point, but by the lack of interest the authors demonstrate for the overlooked complexities that corporate governance brings to the issue of how corporations can or should speak in politics.

Filed Under: Blog, Corporate Governance, Corporate Governance Press Release/In the News/Blog, Disclosure, Disclosure Press Release/In the News/Blog, External Relations Sub-Pages, DISCLOSE, Disclose Act

Sunlight Foundation? Or Growlight Foundation?

In an analysis that is difficult to explain in the absence of cannabis metabolites, the Sunlight Foundation insists that forty percent of the $450 million spent by outside groups is attributable to Citizens United v. Federal Election Commission.

How so? Well, because $126 million was spent by groups “that didn’t have to disclose.” And another $60 million was spent by groups that could now raise unlimited money—and disclose: the so-called Super PACs (or what we would prefer to call the SpeechNow groups), since their creation followed the success of a client of CCP and the Institute for Justice in an appellate court decision after Citizens United.

Take a deep, not smoke-filled breath. Citizens United changed nothing regarding disclosure. At all. Nada.

Filed Under: Blog, Disclosure, Disclosure Press Release/In the News/Blog

Did FEC get too much info. on ‘I Want Your Money?’

How else to explain the inexplicable trouble the Federal Election Commission is having with a relatively straightforward request?

Counsel for the producers of the movie “I Want Your Money” (RG Entertainment) and Star Parker, a commentator (and present candidate for Congress) wrote the FEC requesting confirmation that federal campaign law would not restrict the production and distribution of this movie. The movie is a documentary critical of economic policy and includes Parker as well as snippets of a variety of public figures, some of whom happen also to be candidates. Not everyone is treated with a gauzy rose-colored filter, and in fact I understand the movie is pretty critical of the approach taken by the present administration.

Filed Under: Blog

Big Skies Ahead for Free Speech

The Montana First Judicial District Court for Lewis and Clark County ruled yesterday that the Montana ban on corporate expenditures was unconstitutional, citing Citizens United v. Federal Election Commission as authority.  As noted before, whatever arguments might be available to justify restriction on certain enterprises, a comprehensive ban on spending by all corporations is a different animal.

Filed Under: Blog, Montana

No ”Big Sky” for speech in Montana

In the wake of Citizens United, those jurisdictions that had previously imposed campaign spending bans on corporations have had to rethink their state or local laws.

Not the so-called “Last Best Place.”  The Montana Attorney General is defending that state’s expenditure ban.  According to AG Steve Bullock, the state’s 1912 law remains constitutional.  He is arguing that Montana has a different experience with corporate spending, and can show that spending corrupts politicians.

Now, I have said publicly a couple of times that I don’t think Citizens United necessarily controls in jurisdictions where history and experience indicate certain industries or kinds of corporations pose distinctive threats in politics.  Citizens United does require that those jurisdictions have to show that a BAN on independent spending is a tailored response to a genuine threat, and that’s a pretty difficult argument to make. 

What Montana is attempting to argue is that all corporations pose this threat.  Not explicitly – Bullock acknowledges that the state’s corporate expenditure ban comes out of a history of political struggles involving mining companies.  But the litigants in the present case involve a small painting business and a conservative advocacy group – both, as corporations, prohibited from making expenditures in Montana. 

What’s the justification for that?

Filed Under: Blog, Completed Case, Litigation Blog/Press Releases, Western Tradition Partnership v. Bullock Other Links, Montana

Why not disclose? What do you have to hide?

While the latest demagoguery over foreign money in campaigns is experiencing a mammoth backlash, well deserved, one has to ponder why the assertions had any traction at all.  I think part of the explanation may be how easy it is to color a privacy interest as an admission of wrongdoing.  How often have you heard something like  – “Well, why won’t you just tell us?  What do you have to hide?”

It just so happens that Daniel Solove, law professor at George Washington University School of Law, has thought carefully about the power of that kind of argument, and the dangers lurking within it.  In fact, he has a book coming out in 2011 titled Nothing to Hide: The False Tradeoff Between Privacy and Security.  But we need not wait uninformed for that date, as Solove has argued against the same characterization in other works.

In an essay posted on SSRN, Solove presents the problem of disclosure (or “privacy” but he talks about why “privacy” is a inexact way to describe it) as a challenge facing the individual and his or her control over what the rest of the world “has” of that individual.

Filed Under: Blog, Disclosure, Disclosure Press Release/In the News/Blog

KeatingNow.wha?

Monday, the Solicitor General/Federal Election Commission filed its brief in petition for certiorari in what is commonly known as SpeechNow.org v. Federal Election Commission.

According to the government, this case has morphed into Keating et al v. Federal Election Commission, placing our friend David (and his four fellow travelers) into a pantheon of named parties in FEC matters that includes Senator Mitch McConnell, Francis Valeo, and, of course, Sen. James Buckley—and also bringing together a very different Keating Five.

But, since the case was captioned below as SpeechNow.org v. Federal Election Commission, it seems a little strange (not to mention confusing) to insist that David Keating assume the mantle of named party and the immortality that comes with it as an individual—when the argument is about committee status. But, whatever. Maybe the Solicitor General is just feeling generous these days.

Filed Under: Blog

Ad buyin’ and drug dealin’

In recognition of David Simon, creator of HBO’s The Wire, who today was awarded a MacArthur Genius Grant, I offer this parody summary of a long-lost episode of The Wire:

The first scene opens with D’Angelo in the project’s courtyard, watching business from the couch. In the background, two younger gang members argue about whether corporations should be treated like people.  One notes sagely that it is hard, if not impossible, to bust a corporation upside the head. They debate the proprieties of referring to fictitious persons as “n*gg@$.”

D’Angelo breaks up the heated argument as he sees unmarked patrolmen cruise pass the projects. He pages Avon, the gang leader, and sets off to a meeting with Avon and his lieutenants.

Avon announces that the mutha$fu#$ng D.A. needs to be taught a thing or two. D’Angelo fears he knows where this is leading. Avon confirms his worst suspicions.

“Yo, we takin’ it to the airwaves, bro. We need to bust up some independent expenditure sh#t on this b*tch’s @$$.”

Filed Under: Blog, Maryland, Oregon

‘Fading disclosure’?

In a recent report, self-styled reform organization Public Citizen decried the trend it sees in the 2010 campaign, where some groups speaking out about candidates are keeping the identities of their donors under wraps. Implicit in this report is a call for the Federal Election Commission to require donors to groups be identified, regardless of whether they meant to fund the group’s communications. The folks at Public Citizen support additional disclaimer and donor reporting such as those set forth in the DISCLOSE Act.

First, why is this year different?

Filed Under: Blog, Disclosure, Disclosure Press Release/In the News/Blog, DISCLOSE, Disclose Act

Schnur’s scarlet letter

Dan Schnur, ubermensch of the California Fair Political Practices Commission, is providing us all with a valuable object lesson: its not just the text of campaign finance restrictions that can suppress political expression—the attitude of state regulators matters just as much.

BNA’s Money & Politics Report quotes Schnur this morning as saying this:

“Political consultants in both parties too often engage in borderline behavior under the assumption that being fined in the months after the election is the worst thing that can happen to their candidate,” Schnur said. “Well, that’s not the worst thing that can happen. Before you step too close to the line, ask your candidate if he or she would like their name in a headline along with the words ‘FPPC’ and ‘investigation’ in the weeks before an election.”

This is a threat.

Filed Under: Blog, California