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Public Citizen to Congress: Legislation to Restrain Corporate Election Spending Is Crucial for Democracy

Public Citizen Supports the DISCLOSE Act, Recommends Strengthening It

WASHINGTON - Before the 2010 elections, Congress should approve legislation
designed to restrain corporate election spending and close the loopholes
of current campaign finance laws, Public Citizen told the Committee on
House Appropriations today.

The DISCLOSE Act (H.R. 5175), which stands for Democracy is
Strengthened by Casting Light on Spending in Elections, was introduced
in the House of Representatives by Rep. Chris Van Hollen (D-Md.) and in
the Senate by Sen. Charles Schumer (D-N.Y.). It would restrict foreign
influence in American elections, strengthen pay-to-play law and provide
the most extensive transparency regime to date. That said, the bill must
be strengthened, said Craig Holman, government affairs lobbyist with
Public Citizen, in his testimony.

"This legislation helps to combat the onslaught of corporate-funded
campaign ads that are expected after the Supreme Court's decision in
Citizens United v. Federal Election Commission, which allows
corporations to spend unlimited amounts to influence elections," Holman
said. "Today, corporate lobbyists can walk into a lobbying meeting
carrying a big stick to intimidate lawmakers. A healthy democracy is
going to have a hard time surviving this corporate onslaught without
meaningful measures to mitigate the corrupting role of unlimited
corporate money."

The U.S. Chamber of Commerce is gearing up for a massive spending
campaign in state judicial contests as well as federal congressional
races in 2010. It's already begun the effort; in the Massachusetts
special election in January 2010, the Chamber spent about $1 million in
corporate funds on so-called issue ads in the final days of the U.S.
Senate campaign to help elect Scott Brown.

That's just the beginning. The Chamber has pledged to take advantage
of the new absence of constraints on corporate money in elections and
further bolster its corporate revenues for political activity. It boasts
that it will spend about $200 million on politics this year - double
what it spent last year - with about $50 million of that money funneled
into state judicial and federal congressional elections.

"Add to that figure the money countless corporations will pour into
the election," Holman said. "It is starting to paint a picture of
corpocracy over democracy, isn't it?"


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Some highlights of the DISCLOSE Act, as it stands, include requiring:

* Corporations, labor unions, nonprofit groups and political
organizations that spend more than $10,000 on electioneering to report
all donors who have given $1,000 or more, unless the donor specified
that the donation could not be used for election purposes;
* Groups that sponsor broadcast ads to include a "stand by your ad"
disclaimer in which the groups' highest ranking official appear and
approve the message; and
* Groups that make campaign-related expenditures to disclose them on
their Web page within 24 hours.

The DISCLOSE Act is a great first step to reining in the corporate
power expected to take over elections, Holman said. But it must be
strengthened. The legislation should borrow more from states'
experiences involving pay-to-play (a system that prohibits government
contractors from making political contributions and expenditures on
behalf of those issuing the contracts) to make the provisions more
far-reaching. The bill also should require disclosure outside of the
time periods outlined in the bill, Holman said.

In addition, Public Citizen encourages Congress to proceed with
bolder measures that would:

* Provide candidates with substantial public financing for their
campaigns to help offset new corporate spending in elections (Fair
Elections Now Act, H.R. 1826 and S. 751).
* Require that any significant corporate expenditure in politics be
approved by a majority of outstanding shareholders (Shareholder
Protection Act, H.R. 4790).

* Promote a constitutional amendment that clarifies that First Amendment
protections do not apply to for-profit corporations, except for
legitimate media organizations, and that corporations therefore do not
have the right to spend unlimited amounts of money to influence election
outcomes. Shortly after the Citizens United ruling was issued, Public
Citizen launched a campaign for a constitutional amendment. It currently
has more than 52,000 signers (see


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Public Citizen is a national, nonprofit consumer advocacy organization founded in 1971 to represent consumer interests in Congress, the executive branch and the courts.

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