Letter from Democracy Program Director Susan Liss and Senior Counsel Monica Youn sent to Senators supporting the constitutionality of the DISCLOSE Act.
The Brennan Center for Justice at NYU School of Law writes to urge your support for the Democracy is Strengthened by Casting Light on Spending in Elections (DISCLOSE) Act. Based on years of litigation and policy experience requiring us to balance First Amendment concerns with efforts to reform our systems of political financing, we believe the DISCLOSE Act is constitutional both under long-standing precedent and in light of more recent trends in the campaign finance case law.
The DISCLOSE Act is a necessary and measured response to the Citizens United case which enables unlimited corporate and union spending in federal elections. If these entities are going to spend money to influence federal elections, the American public deserves to know who is providing this money. Under current law there are far too many opportunities for for-profit corporations to hide their involvement by spending through benign-sounding non-profit groups. It is this type of subterfuge that the DISCLOSE Act is meant to curtail.
The constitutionality of disclosure laws such as the DISCLOSE Act is on sound footing. Indeed, just this year, the Roberts Court twice reaffirmed the constitutionality and importance of strong disclosure laws. And while headlines trumpet the end of campaign finance regulation, citing the Citizens United decision among others, over the past 30 years, the federal courts have forged an enduring consensus regarding the clear constitutionality of disclosure that recent decisions have only strengthened.
DISCLOSE stands on firm constitutional ground.
Disclosure and disclaimer requirements for political advertisers remain valid constitutional tools in the jurisprudence of money and politics. For more than three decades – from the seminal 1976 Buckley v. Valeo, upholding the post-Watergate regulation of money and politics, through the 2003 McConnell v. FEC, upholding the Bipartisan Campaign Reform Act’s disclosure requirements for electioneering communications, to this years Citizens United case, the Supreme Court has consistently and repeatedly held disclosure of the source of campaign funds to be constitutional.
In Buckley v. Valeo, the Court’s seminal case on money in politics, the Court explained that campaign finance disclosure serves three key governmental interests:
(1) “disclosure provides the electorate with information as to where political campaign money comes from and how it is spent;”(2) “disclosure requirements deter actual corruption and avoid the appearance of corruption by exposing large contributions and expenditures to the light of publicity;” and (3) “disclosure requirements are an essential means of gathering the data necessary to detect violations” of other campaign finance regulations.3
The Buckley court then went on to find these interests important enough to justify the incidental burdens on political speech that FECA’s disclosure requirement could cause. In 2003, the Court reaffirmed this triumvirate of governmental interests by upholding the Bipartisan Campaign Reform Act’s (BCRA) disclosure requirements for electioneering communications.
Earlier this year, the Court once again upheld BCRA’s disclosure requirements. While Citizens United was a contentious decision in almost all other aspects, eight justices voted in favor of enhanced transparency. In doing so, they explained that “[d]isclaimer and disclosure requirements may burden the ability to speak, but they impose no ceiling on campaign-related activities, and do not prevent anyone from speaking.” Moreover, the Court made clear that disclosure of money in politics is a necessary component of our electoral process:
The First Amendment protects political speech; and disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way. This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.
Even after Citizens United, the Supreme Court recently reaffirmed its endorsement of the values of disclosure in a Doe v. Reed. In Reed, the question was the constitutionality of requiring disclosure of certain information about petition signers. Chief Justice Roberts wrote for the majority that disclosure helped ensure the integrity of the ballot:
Public disclosure thus helps ensure that the only signatures counted are those that should be, and that the only referenda placed on the ballot are those that garner enough valid signatures. Public disclosure also promotes transparency and accountability in the electoral process to an extent other measures cannot. In light of the foregoing, we reject plaintiffs’ argument and conclude that public disclosure of referendum petitions in general is substantially related to the important interest of preserving the integrity of the electoral process.
Justice Scalia wrote a particularly forceful concurrence in Reed arguing that a robust democracy requires transparency and openness in political discourse. As Scalia noted,
Requiring people to stand up in public for their political acts fosters civic courage, without which democracy is doomed. For my part, I do not look forward to a society which, thanks to the Supreme Court, campaigns anonymously (McIntyre) and even exercises the direct democracy of initiative and referendum hidden from public scrutiny and protected from the accountability of criticism. This does not resemble the Home of the Brave.
Reed, like Citizens United, stands firmly for the proposition that disclosure during the political process is a benefit to the voter.
As the Court’s treatment of this issue makes clear, in our First Amendment tradition, secrecy is the exception and transparency the constitutional rule – or, in the Court’s words, “debate on public issues should be uninhibited, robust, and wide-open.” With such strong constitutional precedent, there is little doubt that the DISCLOSE Act’s disclosure provisions are constitutional as well.
The DISCLOSE Act is necessary to close existing loopholes in federal disclosure.
As the Brennan Center noted in greater detail in testimony before the Committee on House Administration, the Federal Election Commission’s lax reporting requirements rarely capture underlying donors who fund political advertisers. As a result, secretive political spending has flourished, leaving voters either confused or completely unaware of who is actually driving political ads.
The status quo is an open invitation for corporations and unions – recently freed to spend without limit by Citizens United – to do so behind dark and heavy curtains. Indeed, under current law, if a corporation would like to spend anonymously on electioneering messages, it can easily funnel its dollars through a non-profit or labor organization. So long as a corporation has not formally “earmarked” the funds for a particular ad buy, it can remain anonymous. One example: in 2006, the U.S. Sugar Corporation funneled approximately $1 million in independent expenditures through blandly-named organizations called “Florida’s Working Families” and “The Coalition for Justice and Equality.” U.S. Sugar was the largest contributor to each of these committees, providing $700,000 of the $1 million spent by the Coalition for Justice and Equality and $200,000 of Florida’s Working Families’ $275,000 budget. These expenditures were all made in support of Candidate Rod Smith and totaled 30% of the expenditures that candidate Smith spent in the primary.
The DISCLOSE Act would counter these secretive practices. For instance, the DISCLOSE Act’s top donor disclaimer approach would have made U.S. Sugar’s participation evident on the face of the advertisements made to support Smith, thereby empowering voters with the information necessary to make an educated decision about his candidacy. Plus, DISCLOSE would require that large donors to groups engaged in political spending be reported to the Federal Election Commission, making that information accessible for the press and members of the public.
There is no reason to delay passage of this important bill.
Before the August recess, questions about the constitutionality of the DISCLOSE Act were raised, – specifically the concern that the Act will “squelch  constitutionally protected speech and to try and hobble associations that give voice to their members’ views in the political process.” However, the DISCLOSE Act was specifically drafted to avoid this constitutional concern. To start, the DISCLOSE Act does not prevent anyone from spending money in elections, nor does it seek general membership lists of organizations engaged in campaign-related spending. Instead, only the names of individuals who have donated over $600 – a relatively high threshold – would be revealed. And, donors can shield themselves from disclosure completely, if they so choose. If a donor specifies in writing that he or she does not want to fund any campaign-related spending, an organization is strictly prohibited from using his or her donation in that way. In such a case, that donor’s identity would not be revealed to the Federal Election Commission, even if the organization chooses to use other general treasury funds for campaign-related spending. These provisions protect donors who wish to give to non-profits but do not want to fund political advertisements.
As currently drafted, the DISCLOSE Act excuses from disclosure certain large organizations that have more than 500,000 members, have been in existence for more than 10 years, have members in all 50 states and raise 15 percent or less of their funds from for-profit corporations (“Exempted Organizations”). Some have questioned whether such an exemption makes the DISCLOSE Act constitutionally suspect under the Equal Protection Clause.16 But, the disparate treatment ofdifferent entities is only unconstitutional when the two entities are similarly situated. See McConnell, 540 U.S. at 187–88. Large membership organizations that have been in existence for a decade can be distinguished from smaller non-profits which may appear and then disappear during a single election cycle. The government’s interest in who is funding each group may well be different. Indeed, as the Washington Post recently pointed out, “well-established, member-supported organizations are not likely to be conduits for the kind of secret special-interest funding, whether from corporations, labor unions or wealthy individuals, that the new disclosure rules are designed to root out.” Similarly, a group that receives only de minimis funding amounts from for-profit corporations is very likely distinct from an entity which is primarily funded by business dollars. The critical question is whether a group is more likely than not to be nothing more than a front for a corporation seeking to conceal its role in funding political ads.
For these reasons, we urge every Senator to endorse the uncontroversial tenets that are embodied in the DISCLOSE Act. This bill deserves an up or down vote and we urge you to vote for cloture and for the bill’s passage.
Very truly yours,
Susan M. Liss and Monica Youn