In January 2010, the U.S. Supreme Court issued a decision that opened the floodgates for increased corporate involvement in our elections. This decision, Citizens United v. Federal Election Commission, rolled back long-standing restrictions on spending in elections, allowing companies, trade associations, and other non-profit groups to spend unlimited amounts of money to influence the outcome of elections. In the Court’s ruling, Justice Anthony Kennedy outlined the critical role of transparency to a functioning democracy:
“With the advent of the internet, prompt disclosure of expenditures can provide shareholders and citizens with the information needed to hold corporations and elected officials accountable for their positions and supporters… 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.”
Unfortunately, voluntary disclosure of political spending by corporations has been limited. According to a 2011 report by the Sustainable Investments Institute and IRRC Institute, only 20% of the S&P 500 companies reported on how they spend treasury dollars to shareholders. Moreover, only one-third of the companies that appeared to make contributions from their corporate treasury reported this political spending to investors.
Election Spending Post-Citizens United
During the 2012 election cycle, spending in federal elections reached an unprecedented $7 billion, according to the Federal Election Commission, making it the most expensive election to date. This rise in election spending was in large part driven by new outside groups, notably Super PAC’s and 501(c)(4) organizations. A post-election analysis by U.S. PIRG Education Fund and Demos in November 2012 found that anonymous donors funneled more than $315 million through outside groups during the election cycle. The rise in outside spending also contributed to a significant increase in negative advertising. There were a record 3 million political ads in 2012, valued at $1.92 billion – a jump of 81% from the 2008 election cycle. Of these, 58% were paid for by anonymous donors and over 60% of ads were negative or attack ads.
Democrats & Republicans United
More than 80% of American s– across all party lines — agree that there is too much corporate money in politics, according to research commissioned by the Corporate Reform Coalition in 2012. The study found that most Americans believe corporate political spending drowns out the voice of the average person, and also showed that there is overwhelming support for strong, common sense reforms to ensure transparency and accountability for corporate political spending.
About the Coalition for Accountability in Political Spending
Founded in 2010 by New York City Public Advocate Bill de Blasio, the Coalition for Accountability in Political Spending (CAPS) is the nation’s first bi-partisan coalition of public officials dedicated to transparency and accountability in corporate political spending. The Coalition urges corporations to strengthen their political spending policies through a combination of direct engagement, pension fund activism, contracting reform and legislation at the state and local level.