Not-So-Full Disclosure

To protect unions, Senate Democrats drop ad requirement from DISCLOSE Act

July 16, 2012

The Senate is expected to vote Monday on the DISCLOSE Act, a Democrat-sponsored bill requiring more disclosure of political activity. The bill faces fierce opposition from Senate Republicans who say it’s an attempt to target and harass donors.

Senate Democrats introduced a new version of the bill last Tuesday evening, but a provision requiring political ads to reveal their funders was pulled from the latest version at the behest of unions, senior GOP aides say.

The DISCLOSE Act of 2012, first introduced in March, had two major provisions: requiring politically active super PACs, unions, and corporations to disclose the identity of donors who contribute $10,000 or more; and requiring electioneering ads to disclose who is funding them.

But the latter so-called "stand by your ad" provision is absent from the version of the bill on which the Senate will vote. A spokesman for Senator Sheldon Whitehouse (D., R.I.), who introduced the bill, said the provision was nixed in response to GOP complaints.

"The ‘stand by your ad’ provision was dropped in response to objections we've heard from folks on the other side of the aisle," the spokesman said. "It's now targeted specifically at requiring disclosure."

However, a senior Republican aide told the Free Beacon the provision was dropped due to union pressure.

The "stand by your ad" provision would have required the CEO or equivalent position of an organization buying electioneering ads—AFL-CIO President Richard Trumka, for example—to endorse them, similar to the endorsements required at the end of ads purchased by political campaigns.

"The Trumkas of the world aren’t exactly the warm, fuzzy personalities you want appearing at the end of your ad," the aide said.

Lisa Rosenberg, a government accountability consultant for the pro-transparency Sunlight Foundation, said the bill treated organizations equally, since member dues in groups such as the Sierra Club and the National Rifle Association would also fall under the threshold.

The remaining provisions leave unions and other labor groups largely unaffected, since union member dues don’t trigger the disclosure threshold. Furthermore, affiliate groups, such as local union chapters, are exempted from disclosure when transferring below $50,000 dollars to parent groups.

When the DISCLOSE Act was first introduced in 2010, the reporting threshold was only $600, but it was raised to reduce the bureaucratic burden on organizations.

Democratic Senators introduced the new version of the bill on the same day the Wall Street Journal reported unions and labor groups spent $4.4 billion in political activity between 2005 and 2011.

The Republican aide said the heart of the Democrats’ decision was protecting unions from disclosure while forcing their political adversaries, such as the Chamber of Commerce and American Crossroads, to reveal their donors.

American Crossroads announced last week it was purchasing $40 million worth of advertisements in eight battleground states.

"What’s interesting is the comparison," the aide said. "A $40 million ad buy has them scared to dickens, but unions on track for $800 million in spending this year get a pass."

The U.S. Chamber of Commerce, along with 60 other business groups such as the National Restaurant Association and the National Retailers Association, sent a letter to Capitol Hill Friday that said the bill is "designed to chill the political speech of corporations, business interests, and others, while giving labor unions special protections."

"Although the exemptions that shield unions from burdensome disclosure may be
facially applicable to business associations, they are of little use to them, because
business associations generally lack the labor unions’ unique, pyramid-style business model," the letter continues.

Senior GOP aides also criticized Senate Majority Leader Harry Reid (D., Nev.) for invoking a rule to move the bill to the floor without taking it through a committee first, as is the usual process for a congressional bill.

The act was "written in secrecy, placed on calendar without a single hearing, and taken to the floor without a mark-up," the aide said. "Not exactly usual process in the Senate."

Democrats and campaign finance reform advocates say the DISCLOSE Act would bring much-needed transparency to the political spending allowed by the Supreme Court’s 2010 decision in Citizens United v. Federal Elections Commission.

"The flood of secret money unleashed by the Supreme Court’s Citizens United decision threatens to drown out the voices of middle class families in our democracy," Sen. Whitehouse said in a statement Thursday.

"The DISCLOSE Act will uphold every citizen’s right to know where this secret money is coming from and whom it is going to, and will help protect the interests of middle class families from the special interests who already have too much power."

However, Republicans and free speech advocates say the legislation would be a tool for liberals to harass and intimidate political donors. Senate Minority Leader Mitch McConnell is an outspoken opponent of the bill.

"The liberals realized they couldn’t shut their critics up after Citizens United, so now they’re going after the microphone with DISCLOSE," McConnell said in a statement to the Free Beacon.

Sen. Chuck Schumer (D., N.Y.) said as much when promoting the bill at a 2010 press conference. "The deterrent effect should not be underestimated," Schumer said.

Sen. Scott Brown (R., Mass.), one of the most moderate Republicans in the upper chamber of Congress, has also come out against the legislation.

"The DISCLOSE Act is a cynical political ploy masquerading as reform and I continue to oppose it," Brown said in a statement. "Rather than treat all sides equally as a true reform bill would, it contains special carve outs for union bosses and other favored interest groups. In Massachusetts, I took direct action to limit the influence of outside spending and Super PACs, and I am glad my People’s Pledge has kept third parties out of our state. I didn’t wait for Washington D.C. to come up with a solution to the problem of outside money, and I would encourage other candidates running across the country to do the same."

David Keating, the president of the Center for Competitive Politics, said the act is "a fraud the way they’re selling it."

"A lot of nonprofit orgs are going to have to make major choices on whether they want to run an ad and disclose their donors or sit out of the process," he said. "This is a radical bill that’s being sold as a reasonable bill."

The American Civil Liberties Union, which also supported the Supreme Court decision in Citizens United, opposes the DISCLOSE Act as well.

"The electoral system is strengthened by efforts to facilitate public participation, not by chilling free speech and invading the privacy of donors to controversial causes," the ACLU writes in a letter.

"Indeed, our Constitution embraces public discussion of matters that are important to our nation’s future, and it respects the right of individuals to support those conversations without being exposed to unnecessary risk of harassment or embarrassment. Only reforms that promote speech will bring positive change to our elections, and overbroad disclosure requirements do the opposite."

Sen. Reid’s office did not return requests for comment.

The AFL-CIO did not return requests for comment.