Please forgive these rambling reflections on a windy Friday morning.
I would think those seeking reforms in our campaign finance system would be happy about HB 539, introduced by House Speaker Calvin Say and Judiciary Chair Jon Riki Karamatsu.
The bill would prohibit corporations and companies from making free use of their own funds for campaign contributions and other political expenses. The House Judiciary Committee held a public hearing on the bill yesterday.
Under the terms of the bill, corporations would be prohibited from contributing directly to candidates. Corporations would be allowed to transfer up to $25,000 during a 2-year election cycle to one noncandidate political committee it sets up, which in turn could make campaign contributions to candidates or other political committees (such as committees urging passage or defeat of ballot issues).
Unlike federal campaign law, which sets a higher contribution limit for political action committees than for individuals, the bill would apply the same contribution limits to corporate committees as to all other contributors.
During some past elections, it wouldn’t have been unusual for large corporations to distribute upwards of $100,000 in campaign contributions, so restricting the largest interest groups to $25,000 in total contributions to all candidates statewide during a two-year election cycle would be a substantive reform.
When you think about it, with the governor, Lt. governor, four mayors, candidates for four county councils, and candidates for 76 seats in the legislature all looking for resources to fund their campaigns, corporations and other groups can’t get much of an advantage even if they spend the full $25,000. If the corporation, through its noncandidate committee, contributed the maximum allowed by law to the governor, the Senate President and House Speaker, that would take up $12,000 of the total. The rest, spread among the remaining 74 members of the legislature, works out to a token $175 each. You can work the numbers a lot of different ways, but in the end it just isn’t possible to buy a lot of influence with this amount of cash.
But instead of seeing this as a golden opportunity to work with key legislators to substantially restrict the role of corporate money in politics, my progressive friends came into yesterday afternoon’s House Judiciary Committee hearing and used the occasion to blast the bill for failing to prohibit all contributions using corporate funds.
They rightly point out that corporations are already prohibited from using their treasury funds for campaign contributions in more than 20 states as well as in federal elections.
Good point. Has that put an end to the ability of corporations to influence politics in those states? Obviously not. So the choice between a total ban on corporate contributions and a substantial limit such as the one proposed by HB 539 is really more symbolic than real if your ultimate goal is returning political power to regular people by limiting corporate influence.
And while I view the $25,000 cap as a meaningful “limit” on corporate spending, they view it as a substantial increase, pointing to a provision against transfers between noncandidate committees which the Campaign Spending Commission has interpreted to mean that corporations can’t use more than $1,000 of their own treasury funds to make campaign contributions. Period.
The problem with that view is that the commission’s interpretation was overturned by a Maui court and, while an appeal to the Hawaii Supreme Court is pending, it doesn’t appear likely that the commission will prevail. I’ve written at length about this previously here and here.
The history is complicated, going back to the Campaign Spending Commission’s interpretation of a 2005 amendment which apparently opened some ambiguity in a provision regarding contributions to political committees that are not formed by candidates. The commission’s extremely restictive intepretation virtually eliminated campaign contributions by corporations but was struck down in the Maui court decision, currently on appeal to the Hawaii Supreme Court.
The debate continued during last year’s legislative session, ultimately ending in no action being taken.
If those opposing HB 539 asked my advice, I would suggest they weigh the risks and rewards.
The risk in opposing the bill is that the legislature will again take no action, key legislative friends of reform will end up feeling “burned”, corporations will be free to use as much of their own money as they wish because of the Maui court’s decision, and the Supreme Court will make that situation permanent by upholding the decision. The director of the Campaign Spending Commission noted the additional risk that corporate contributors will be able to evade disclosure requirements, meaning that the public will have a difficult time tracing corporate influence. The reward, absent success in pressing a total ban, is being seen by the public as opponents of corporate power and as advocates of the rest of us.
What are the risks and rewards of supporting HB 539? Rewards seem clear. Use of corporate money for campaign contributions, and by implication as a source of political power, is limited. The law is no longer ambiguous, something every should appreciate. Both legislators and reformers can share credit for making progress in the right direction. The principle that corporate influence needs to be limited and controlled is recognized and embraced.
The risks? I suppose there’s a risk that the goal of banning all corporate contributions becomes harder to reach. But since no real progress in that direction has been achieved anyway, it’s a risk in theory only. Perhaps others can fill in other parts of this equation that I’m missing.
All in all, it seems to me to make neither political nor practical sense for progressives to assume a posture so totally opposed to this bill.
And there’s at least one other complicating factor which hasn’t been discussed. Look up the provision limiting contributions to noncandidate political committees and you’ll see an annotation indicating that prior court cases have found contribution limits unconstitutional when applied to committees taking positions for and against ballot measures. But that’s something to consider another day.
The House Judiciary Committee will take up HB 539 again next Tuesday, February 17.