Small Donor Empowerment
Small Donor Empowerment
Citizens United: Consequences and Solutions

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"The idea that you can merchandise candidates for high office like breakfast cereal is the ultimate indignity to the democratic process." Adlai StevensonDemocratic candidate, 1956

Cuomo on his use of Party Committee housekeeping accounts, which can receive unlimited contributions, to provide $6 million for his campaign: 

"Those aren't loopholes. Those are the laws that are written," he said. "So yeah, I live within the laws of the current campaign finance system. I would very much like to change them."

“The problem is this: You have someone who is trying to lead—that we want to lead—on getting money out of politics in Albany … and at the same time he’s cynically taking major money from corporations,” Bill Samuels, Jon Campbell, "Bill Samuels Jabs Cuomo on Campaign-Finance Reform," LoHud.com, July 26, 2012

"Gambling Group Gave $2 Million to a Cuomo Ally"
“Aid as Governor Worked on Casino Push, He Denies Link”
New York Times, June 5, 2012

Overview by Bill Samuels, Founder

If we think money in politics corrupts how laws are made in Washington, Albany is equally bad.. I ought to know having served as finance chair for the Democratic State Senate campaign effort in 2008.

If one thought the influence of money was bad  before the Citizens United decision now it borders on the absurd.

It wasn't always this bad in statewide elections or in the Presidential election. The reform movements of 1969 to 1972 are partly to blame. We said “Power to the People” and led marches on Civil Rights, The Vietnam War, began the Woman’s Movement and the Environmental Movement.  But we forgot Campaign Finance Reform.  

Presidential candidates Adlai Stevenson in 1952 and Hubert Humphrey in 1968 didn’t even have to run in a primary.

The Presidential Conventions in 1968 gave only 20% of the vote to primary voters and 80% to the professional political delegates. In 1972 it was flipped to 80% primary and hence our never ending state by state Presidential campaigns and huge TV expenditures.

Same happened in New York State. Party primaries only became the rule in 1968. Before conventions of professionals selected Rockefeller, Javits, Keating, Harriman, Roosevelt, Smith. It wasn’t until 1970 that we had a gubernatorial Democratic Primary where Arthur Goldberg defeated Howard Samuels.

Again we forgot Campaign Finance Reform and basically gave power to the money and TV. A Carl Paladino never would have been the 2010 Republican Gubernatorial candidate under the old system.

It is now time to fix that historical mistake and New York must take the lead.

What can we in New York do?? The Governor has stated in 2010, 2011, 2012, and 2013 that it is a priority. That is an important step that could allow New York State to be an example for the nation.

But the watered-down, 2011 ethics bills, LATFOR redistricting veto threat than was never real, and the badly-flawed constitutional amendment that followed are unacceptable.

We in New York want permanent and major change. That will not happen without a demanding movement all over New York State.  We need a NYC matching-donor system that empowers small donors.

The case must be taken directly to the people and the governor. It should have been done with independent redistricting, where a vast majority of our state representatives said they would vote for change and then did not.

Like was done successfully for Marriage Equality, the redistricting fight should have been taken to the people. It wasn't. 

We cannot let this happen to Campaign Finance reform. No statute full of holes can or will be acceptable, nor will small improvements by the governor, like lowering donation limits or having real-time disclosure, be sufficient.

Currently there is nothing in New York State Constitution on point. The same is true nationally. Dylan Ratigan and others are leading a fight for a new 28th constitutional amendment nationally. New York should not wait for Washington. We must lead and not pass some new statute with compromised holes in it.

I make the following challenges:

   1. The Governor should set an example by refusing corporate donations and calling for a constitutional amendment that prohibits donations by people who do business with the state.

   2.  New York State should adopt a matching system like New York City's.

   3. All corporate and LLC donations should not be allowed for candidates that opt into the New York State small donor empowerment system.

We must encourage  voters around the state to form a Coalition of Opposites, debate views, and maybe to everyone surprise there may be agreement that it is time to force change in Albany and give courage and support to those in Albany that want change but are not sure they will be commended for standing up.

Those that stood up for marriage equality--a coalition of opposites, ..were recognized. Those that lead in Campaign Finance reform will have a real place in our history.

 

 

Campaign finance is protected as "freedom of speech" by the First Amendment of the United States Constitution and as "liberty of speech" by Article 8 of the Bill of Rights of the New York State Constitution.  The First Amendment reads in part "Congress shall make no law ... abridging the freedom of speech ..." while New York State's "liberty of speech" can be read on the right.

The United States Constitution, including the First Amendment, is the law of the land and trumps any state constitution or law that might violate its provisions.  However, state constitutions and laws that violate the United States Constitution remain on the books until they are specifically challenged in Court and ruled to be unconstitutional.  Additionally, even freedoms guaranteed by the United States Constitution like "freedom of speech" can be restricted by the states where there is a compelling state interest among other factors.

Restrictions on freedom of speech that the Supreme Court has upheld on a federal and state level include contribution limits, disclosure requirements and public funding of elections.

In a landmark 5-4 decision on January 21, 2010, the Supreme Court lifted a 100 year old federal ban on direct corporate spending on candidates in Federal elections.  At the core of the Citizens United decision is the question of whether the rights to free speech, afforded by the First Amendment to the United States Constitution, are afforded to corporations, or entities other than "people."

In the Citizens United decision a majority of the supreme court justices determined that yes, corporations may exercise opportunities to engage in electioneering using a variety of methods and venues previously unavailable.  In many states across the United States, including New York, there is no mention of campaign finance or political spending in state constitutions, except for the free clause, which prohibits any law restraining or abridging "liberty of speech." Thus, with the exception of the state of Montana, which as of this writing is the only state to mount a challenge to Citizens United, all states will experience the consequences of the decision.

The impact of the decision means that independent expenditures, that is money or effort used to support or oppose a candidate, is not subject to spending limits by Congress as it would infringe upon "free speech" rights.  It is only the "independent expenditure" component of electioneering that is impacted, independent meaning that the money or effort is not "coordinated" with the campaign.  Limits on the amount of money or effort directly contributed to campaigns continue to be limited. 

Although New York State does not have a statute limiting independent expenditures by corporations or individuals, this decision may prevent New York from enacting a statute limiting such expenditures that could survive constitutional challenge.  The Supreme Court's decision does not bar the state from enacting a law regulating independent expenditures to the extent of requiring disclosure of the amount, nature or source of political advertising for or against a candidate, but may prevent any limit being placed on the amount in state elections.

The state's campaign and political contribution limits do not appear to be affected by this decision.

Topics in Campaign Finance include:

  • Corporate Spending (Citizens United)
  • Contribution Limits
  • Public Funding
  • Disclosure

 

In the three years since the Supreme Court decided Citizens United, the consequences have been extensive.  Corporations are making massive contributions to "Super PACs" running "uncoordinated" efforts for or against candidates, flooding the airwaves and mailboxes with mostly negative information.  Super PACS are out-raising and out-spending the candidates themselves.  While this activity is "uncoordinated" between the Super PAC and the campaign, any reasonable person can see the lack of direct coordination is specious at best, and frankly irrelevant.

Two former aides to Newt Gingrich, started a Super PAC and ran millions of dollars of advertising against Mitt Romney in South Carolina.  One wealthy colleague of Mitt Romney's, organized a corporation for the expressed purpose of making a one million dollar contribution to a Super PAC clearly supporting Romney and then disbanded the corporation shortly thereafter. 

More troubling still is the fact that corporations can make these massive contributions tilting a campaign in favor or against a particular candidate using dollars that are undisclosed, or laundered through third parties.  Corporations can contribute unlimited amounts to third parties like Chambers of Commerce or professional associations, which in turn can spend on campaigns.  This action provides "cover" for a corporation that may in fact imperil the bottom line.  One recent example of this hanky panky was sourced by a reporter researching the passage of health care reform in 2009.  The reporter found that while the CEOs of five large health care insurance companies were inside the Whitehouse promoting passage of reform, those same CEOs had contributed a total of $86 million to the Chamber of Commerce who used the money to run television commercials opposing passage.  

Lack of transparency and disclosure doesn't only impact voters, it is risky business for the bottom line as well.  Research done at Harvard University reveals that corporations engaged in political operations are less profitable than corporations that don't engage in politics.  Polling reveals that shareholders overwhelmingly believe they should be informed of their investments efforts in the political arena.

The truth is that our elections have turned into auctions, the selling of a candidate to the highest bidder.  Individual candidates become more and more irrelevant as massive corporations buy and sell candidates who will do their bidding.  Elections have become activities of commerce, but commerce that is risky for business.

We know that the consequences of Citizens United mean an ongoing cycle of noise and negativity compounded by the absence of truth and transparency.  What is being done to stop this?  A great deal.

There are several types of campaigns working hard to influence and change the reality brought upon by Citizens United:

1. The Coalition for Accountability in Political Spending (CAPS) was founded by Mayor Bill de Blasio while he was the Public Advicate.  CAPS is a national bi-partisan group of elected leaders representing 90 million constituents and managing nearly one trillion dollars in pension assets. CAPS leaders use their fiduciary roles in pensions and procurement to influence corporate behavior in political spending.  CAPS has had some initial success, and will expand with the introduction of legislation across the country that mandates full disclosure of contributions by companies doing business with cities and states.

2. Amend the Constitution.  An organization called Free Speech for People, and progressive elected leaders including Senator Bernie Sanders (I) VT,  are leading efforts to amend the Constitution making clear that corporations are not people.  

3. A broad based collection of labor groups, good government groups like Common Cause and Public Citizen and socially responsible investors have joined to form the Corporate Reform Coalition.  This group is working to support a petition filed by ten academics led by Lucien Bebchuck from Harvard, with the Securities and Exchange Commission.  The petition outlines the connection between the SEC's obligation to regulate publicly traded companies and the importance of protecting the public and shareholders against risky corporate behavior in political spending.   

4. At the federal level a bill called the "Disclose Act" has been introduced.  

5. President Obama has had an Executive Order on his desk for months now that only need be signed to influence corporate political spending.  The order, which has been used as a model for the development of the CAPS legislation noted above, would require corporations paid with tax dollars to disclose political expenditures.

NEWS BEHIND THE CONSTITUTION
New York Times
Wednesday, December 14, 2011
There is, in his view, one thing holding back America, a legal but corrupt system of campaign finance. “Practically every important issue in American politics today is tied to this ‘one issue,’ ” he writes. Mr. Lessig’s...
Link to Original Source - Link to Cached Version
 
Slate
Eliot Spitzer
Friday, September 4, 2009
Two policy objectives drive campaign finance reform: first, limiting the flow of dollars to, or expenditures on behalf of, any candidate in a way that could be—in actuality or perception—a quid pro quo; and second, limiting the impact that...
This article speaks in support of what the Supreme Court found in the Citizens United case, and makes the case that corporations and unions should not be limited in the amount of money they spend on political speech.
Link to Original Source - Link to Cached Version
 
New York Observer
Azi Paybarah
Tuesday, April 24, 2007
Among Spitzer's proposed reforms, a comprehensive list of which the administration released today for the first time, includes the lowering of campaign contributions for all state officials, increased penalties for violating contribution limits, and...
Link to Original Source - Link to Cached Version
 
OPINION EDITORIALS ON THE CONSTITUTION
New York One (NY1) News
Zack Fink
Wednesday, July 17, 2013
Samuels: "If you want to bring reform to Albany, change the culture, you have to lead. You have to lead by example. He has not done that."
Link to Original Source - Link to Cached Version
 
Capital Confidential
Jimmy Vielkind
Thursday, June 13, 2013
As the legislative session closes, some advocates are wondering whether Gov. Andrew Cuomo is wholly committed to pushing through some of the marquee agenda items he introduced in the last two weeks. 
Link to Original Source - Link to Cached Version
 
New York Times
Sunday, May 12, 2013
Gov. Andrew Cuomo, who promised to clean up state government in his 2010 campaign, has now become so alarmed by the latest scandals in Albany that he has issued a threat lawmakers ought to take seriously.
Link to Original Source - Link to Cached Version
 
Poughkeepsie Journal
Friday, March 15, 2013
 Gov. Andrew Cuomo has rattled off important objectives in his bid to change New York’s campaign laws, calling for “transparency, disclosure, public finance, limits.”  He’s right on three out of four accounts, though he...
Link to Original Source - Link to Cached Version
 
SOLUTIONS
A selection of relevant solutions from other states.

 

 

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