A New Way To Mitigate The Flood Of Corporate Money Into Our Political System?

According to a new survey by Pew, the Supreme Court is held in greater contempt by Americans than in anytime in the last quarter century. After a favorability rating as high as 80%, as the court has become more and more corporately oriented and more obviously partisan and more obviously in thrall to the one percent, that favorability rating has plummeted to 52%. And "[u]nlike evaluations over much of the past decade, there is very little partisan divide. The court receives relatively low favorable ratings from Republicans, Democrats and independents alike."

Many groups have different beefs with the Supreme Court but the one that almost everyone agrees was most horrendous is the 5-4 Citizens United decision ceding our nation's political system to wealthy, unaccountable corporations. The idea of a constitutional amendment was immediately embraced by many opponents of the decision-- but that takes a long, long time and is not very easy-- especially with the Koch-financed, anti-democracy organization ALEC in control of so many state legislatures. A couple of weeks ago E.J. Dionne wrote about a plan to get around it that New Yorkers are looking at:

One would like to think that the court will eventually admit the folly of its 2010 ruling and reverse it. But we can’t wait that long. And out of this dreary landscape, hope is blossoming in the state of New York. There’s irony here, since New York is where a lot of the big national money is coming from. No matter. The state is considering a campaign finance law that would repair some of the Citizens United damage, and in a way the Supreme Court wouldn’t be able to touch.

The idea is that to offset the power of large donors, citizens without deep pockets should be encouraged to flood the system with small contributions that the government would match. Gov. Andrew Cuomo (D) has pledged to a state overhaul of this sort, based on the one already in force for New York City elections. In his state of the state address in January, Cuomo spoke of how urgent it is to “reconnect the people to the political process and their government.” He could make himself into a reform hero across the country if he and the Legislature created a model law for other states, and the nation.

The New York City program is straightforward: The government gives participating candidates $6 in matching funds for every dollar raised from individuals who live in the city, up to the first $175. At a maximum, this means a $175 contribution is augmented by $1,050 in public funds. That’s a mighty incentive for politicians to involve more citizens in paying for campaigns. In the city system, participating candidates have to live within certain spending and contribution limits. In a new statewide system, there are likely to be no spending restrictions but lower limits on contributions.

The beautiful thing is that this approach should answer most of the criticisms offered by those who defend the Citizens United world. I say “should” because advocates of current arrangements will find a way to oppose any reforms. But the New York Revolution, if it happens, would undercut many of their arguments — including their constitutional claims.

The New York reform does not limit anyone’s capacity to participate. It creates incentives for more people to participate. It does not reduce the amount of political speech. It expands the number of people speaking through their contributions. It does not protect incumbents. On the contrary, it opens the way for candidates who might otherwise be driven from the competition by established politicians with access to traditional funding sources.

In short, it makes our democracy democratic again.

But there's still another route to the same goal that people haven't been talking about much but that seems very promising to me. Public Citizen alerted me to a corporate reform approach that would go through the Securities and Exchange Commission. It's all about transparency and accountability.

A record number of people agree: The Securities and Exchange Commission (SEC) should regulate corporate political spending.

As of today, more than 178,000 comments have flowed into the agency, thanks largely to the unique bedfellows in our Corporate Reform Coalition, which includes institutional investors managing a combined total of $800 billion in assets, as well as public officials, legal scholars, good government groups, environmental organizations and more. This is a huge milestone: We have set the all-time record for comments submitted to the SEC.

Coalition members urged the agency-- and encouraged their members and the public to weigh in-- to create rules that would push corporate political spending into center stage. Specifically, the SEC should shine light on the corporate political activity of all publicly traded companies.

U.S. Supreme Court Justice Anthony Kennedy’s opinion in Citizens United v. Federal Election Commission-- the case that opened the floodgates to corporate cash in elections-- strongly endorsed comprehensive disclosure requirements. The SEC could and should put these assumed requirements in place for the publicly traded companies they oversee.

Several prominent law professors filed a petition with the SEC in August, urging it to require publicly traded companies to disclose their political spending. Numerous others have joined their voices to the call for SEC action, from state treasurers to representatives and senators to the former CEO of one of the country’s biggest mutual funds, John Bogle of Vanguard. Now,  average investors and the public are getting in on the act and are calling for reform as well.

Mandating transparency is well within the SEC’s authority. The SEC should help the public and shareholders hold CEOs accountable for what they spend in politics. 

One SEC Commissioner, Luis Aguilar, is already on board. "Investors," he said, "are not receiving adequate disclosure, and as the investor’s advocate, the commission should act swiftly to rectify the situation.” They need two more votes. It seems like an effort worth backing in addition to a much more burdensome fight for a constitutional amendment.