The Democrats Versus the Constitution: the Disclose Act
"We have got to protect the incumbency in the House. We have got to protect the incumbency in the Senate ... It is going to be hard. Those tea-baggers are out there. There is an anti-incumbency mood out there."
AFSCME President Gerry McEntee
BACKGROUND
The House may consider H.R. 5175, the DISCLOSE Act, this week, a bill that would seek to legislatively overturn the recent Citizens United v. FEC Supreme Court decision. H.R. 5175 was introduced by DCCC Chairman Chris Van Hollen and Sen. Chuck Schumer, the past DSCC Chairman, in late April. The Committee on House Administration marked up the bill on May 20, 2010, on a party-line five to three vote. After weeks of being unable to reach agreements on H.R. 5175, Democrats have seemingly accepted language that will help them get the necessary votes for passage. The proposed legislation is a punitive measure for associations of persons who choose to exercise their right to free political speech as guaranteed by the Constitution, and affirmed in the Citizens United v. FEC case. The bill's disclosure requirements and limits on foreign corporations and government contractors target only the political speech of corporations, with no effect on unions, including foreign-influenced labor unions, public-employee unions, or government grant recipients.
UNION LOOPHOLES
While proponents have claimed the legislation applies equally to corporations and unions, the bill exempts unions from restrictions that would limit their campaign activity-activity which is largely directed toward Democrats. Interestingly, two unions announced plans in May to spend more than $100 million on Democrat incumbents in the 2010 midterm elections. Numerous measures proposed by Republicans to provide equivalent rules for unions and corporations were denied by the Democrats during the Committee mark-up.
Government Contracts: Specifically, unions are exempted from numerous restrictions set for other entities under the bill. Regarding government contracts, unions are free to spend unlimited amounts of money to support Congressional candidates despite contractual relationships with the federal government. Meanwhile, the bill applies bans on political speech if other non-union entities are in a contractual relationships with the federal government.
The bill would restrict government contractors over a certain threshold and companies with a foreign investor holding more than 20 percent voting shares from making any political expenditures. Democrats have claimed that unions do not require this prohibition because their members are required to ratify contracts.
TARP Recipients: The bill also bans TARP recipients from engaging in political speech, but allows unions to spend unlimited amounts of money to support Congressional candidates despite representing and receiving dues from employees whose employer is a TARP recipient.
Foreign Nationals: H.R. 5175 would require non-union entities to determine the nationality of every shareholder to determine whether at least 80 percent are U.S. citizens, and would be forced to go through a lengthy certification process to certify, under penalty of perjury, the company's eligibility to spend money on political speech. In contrast, unions would be permitted to spend unlimited amounts of money on political speech without regard to whether any dues are derived from non-citizens (including those here illegally) and without any prior certification.
Reporting Requirements: The bill would require entities other than unions to report sources of income over $600 to the Federal Election Commission (FEC) if engaging in political speech, but allows unions to escape income reporting requirements (average annual dues for unions are approximately $400 per member). Furthermore, the bill exempts unions from reporting transfers from affiliated unions up to $50,000.
Disclaimer Requirements : While H.R. 5175 would require that corporations and other organizations include additional disclaimers in political advertisements identifying any source of income greater than $100,000, the bill specifically exempts unions from additional disclaimer requirements.
For more information or questions please contact Sarah Makin at 5-5107.
For additional information, contact:
The House Republican Conference Policy Office
