FREE SPEECH ZONE | The signficant hidden dangers of Citizens United


This year, in an absolutely stunning and bitterly divided 5 to 4 decision, The Supreme Court. overruled two important precedents about the First Amendment rights of corporations, and  ruled that the government may not ban political spending by corporations in future elections. The ruling, Citizens United v. Federal Election Commission, No. 08-205, overruled two precedents: Austin v. Michigan Chamber of Commerce, a 1990 decision that upheld restrictions on corporate spending to support or oppose political candidates, and McConnell v. Federal Election Commission, a 2003 decision that upheld the part of the Bipartisan Campaign Reform Act of 2002 that restricted campaign spending by corporations and unions. (The ruling keeps intact restrictions on funds to candidates, but allows unlimited expenditures for “independent political organizations”).

Ironically, Minnesota’s own Target Corporation has suddenly become the “poster child” for the ruling in its $150,000 contribution to MN Forward, and consequent support for Tom Emmer’s campaign for governor.  The backlash, primarily because of Emmer’s known opposition to gay rights, was swift and severe – but that has been fully reported. What has not been widely discussed are the added ramifications and hidden dangers of the SCOTUS ruling, and its disproportionate effects on future elections. Here are some:

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Corporate Executives are strongly tilted to the right

This may be assumed and self evident, but still needs added vetting. Gregg Steinhafel, Target CEO is a strong Republican supporter. And it is no wonder he would direct his company’s funds to a hard right candidate. He is reported to have given Emmer $2000 individually (the maximum); and over $25,000 to various Republican causes (including substantial contributions to Michele Bachmann’s campaigns). Historically, individual contributions from Target’s other top executives have gone mainly to Republicans. Moreover, Steinhafel’s total compensation, from all sources, at Target last year was over $13 million (according to Forbes)- not atypical for top executives at major corporations. There is little question where such contributors will send their company’s money. When we see other corporate contributions, count on them going the same way Steinhafel’s corporate money went. Indeed, News Corp.has already committed $1 million to support Republican candidates.

Interlocking boards

As with most corporations, the Target Board is made up of current or former executives with other major American corporations. These include directors associated with such companies as Eli Lilly, General Mills, United States Cellular, Xerox, and Wells Fargo.  This creates a clique – a “club” – of individuals with a common cause; and that cause is clearly the one espoused by the U.S. Chamber of Commerce and other similar supporters of the right.  If Steinhafel made his contribution to MN Forward with the knowledge and acceptance of the Board, then this assumption of a collusive effect is correct; if he did it without Board approval, it brings up a different abuse of management power.

Not his money

Either with or without board approval, it is essential to note that Steinhafel was contributing a substantial sum of money that was not his, or the Board’s. It belonged to the shareholders – and there is no doubt that a fair percentage of them were not supporters of Emmer, or other right wing causes.  There are other interested parties as well – the employees of Target, many of whom would probably not be pleased to see their company supporting a candidate they did not approve of. Then, there are the customers of Target (I include myself), who do not wish to see their purchases contributing to the revenues of the corporation — then delivered to candidates they seriously oppose.

MN Forward

This brings us to the entity to which the contribution was made: MN Forward. The organization if staffed by former insiders from Governor (“no-tax”) Pawlenty’s administration. It is headed by Brian McGlung. “Brian is best known as the public voice of our office, but has been much more, “Governor Pawlenty said. “He’s been one of my closest advisors during both terms and I greatly value his insights, loyalty and expertise. Brian is an integral part of our team, and I know he will continue to have great success.”

MN Forward claims to be “bi-partisan”, and has endorsed three DFL candidates as a show of independence.  Two are known conservative pro-business legislators; the third (Terri Bonoff), accepted the MN Forward endorsement with a kind of “thanks, but no thanks” statement. Bonoff stated: “I am, however, concerned about the effect of the Supreme Court ruling in the Citizens United case, which opened the door to direct corporate spending in political campaigns. This new influx of money, combined with self-financing millionaire candidates, threatens to drown out the voice of the people who are supposed to be deciding our elections.”

In fairness, it should be noted that unions are also eligible to contribute funding under the new ruling, but with union membership at an historic low, they will be no match for the massive dollars residing in major corporations.

It is clear and obvious that these new, substantial (actually unlimited), corporate contributions will be going to entities that are tilted to the right…have conservative agendas…and may well have candidates (like Emmer) with extreme right views.

In short…

The new Citizens United ruling is going to have far reaching effects beyond the obvious pouring of unlimited funds into political campaigns.

  • Those who decide on the corporate contributions will be high income earners who almost universally will select conservative causes for their funding
  • Implicit in all this is the use of corporate funds to protect high earners personal financial self interests – particularly tax issues
  • They interlock with Boards of Directors who interface with colleagues at other corporations to develop a de fact network of right wing giving
  • They do so with funds they do not own (it is shareholder money), thus making American corporations virtual private political piggy banks for the conservative executives who make contribution decisions
  • The entities they give the money to appear to be universally tilted to the right as is MN Forward
  • In today’s world of sound bites, mass media advertising, and costly campaigns, these entities are going to have power and influence beyond anything known in previous elections with huge and new bankrolls

The net effect of all this is that this new SCOTUS ruling is going to have even more insidious ramifications than appear even at this early stage. It is going to build a powerful inter-corporate network of funding and contributions that can profoundly affect our future elections, and ultimately the governance of our nation. Once this interlocking, synergistic money-giving machine matures; and the entities they fund become even more adept at influencing elections, the hidden dangers of the SCOTUS ruling will become more and more evident, and likely extremely damaging to Minnesota and America’s electoral process. Sadly, 2010 will be only the first chapter in this dangerous long term new dynamic.