“This Transparency Enables Electorate to Make Informed Decisions”

LA Times looks at how that's worked out for "electorate"

Back in January, Supreme Court Justice Anthony Kennedy wrote the following, in the opinion of the court in Citizens United v. FEC (the ruling, for under-rock dwellers, that freed corporations and unions to spend unlimited amounts in candidate elections, though not by giving directly to candidates):

With the advent of the Internet, prompt disclosure of expenditures can provide shareholders and citizens with the information needed to hold corporations and elected officials accountable for their positions. This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.

Can provide. Does it?

Yesterday, the LA Times checked in on how that’s been working out for “the electorate” this election season. (Not so well, as you might already know if you’ve been paying even a little attention to the midterms).

Per the Times:

But Kennedy and the high court majority were wrong.

Because of loopholes in tax laws and a weak enforcement policy at the Federal Election Commission, corporations and wealthy donors have been able to spend huge sums on campaign ads, confident the public will not know who they are, election law experts say.

Corporate donors have been able to hide their contributions despite the opposition of shareholders and customers — the very groups cited by Kennedy.

Yup, those 501(c)s. More Times:

Under the tax code, nonprofit groups can register as “social welfare” or other organizations, meaning they can spend money on campaign ads without having their name disclosed as long as their primary activity is not political. In a little-noticed opinion in August, a divided FEC took the view that big donors who fund ad campaigns need not be disclosed unless the donor gave the money for a “particular advertisement.”

In other words, it turns out that a whole lot of the information needed to hold corporations and elected officials accountable for their positions has not, by design, been available to shareholders and citizens. Moreover, the groups that are required to file some disclosures (like 527s, super PACs, political candidates) don’t always do so in a manner prompt or detailed enough to “hold corporations and elected officials accountable,” something ProPublica demonstrated earlier this year.

In May, before many of these 501(c)s were even formed (Crossroads GPS, for example, was launched in July as an offshoot of the 527 group, American Crossroads, which itself came into being in April) ProPublica, inspired by the same Justice Kennedy “advent of the Internet” quote, showed how some existing disclosure filings are made neither promptly nor clearly enough for even two investigative reporters (let alone “shareholders and citizens”) to connect the dots to the point of truly holding lawmakers accountable. ProPublica’s headline? “Contrary to Citizens United Opinion, Campaign Contribution Records Lack Transparency.”

At Salon yesterday, Joe Conason wondered why Justice Kennedy and his colleagues didn’t attempt “to inform themselves about the realities of donor disclosure before overturning the century-old restrictions on corporate cash,” noting that “the Justices could have discovered quite easily” the section 501(c) “loophole” in the IRS code. It’s not new. (See, for example, “Groups hide behind tax code,” St. Petersburg Times, December 2006).

The LA Times piece quotes a former FEC commissioner (and current election law adviser to Democrats) calling Justice Kennedy’s opinion naive and reflecting a “very uninformed view of how disclosure works.” Salon’s Conason goes with “cynically partisan.” The bottom line, though, is that “the electorate” is left uniformed. “Advent of the Internet” and all. And Congress, as the Times mentions in passing, has thus far been unable to enact a new disclosure law to—theoretically, at least—help rectify this.

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Liz Cox Barrett is a writer at CJR.