Will Obama Finally Order Corporations With Federal Contracts To Reveal Their Political Spending?

After years of fruitless negotiating with Republicans, the White House has turned to the power of its pen — executive orders — to make progress on many needed national priorities.

So why is President Obama still hesitating on what should be a no-brainer: requiring corporations with federal contracts to reveal their political spending?

Corporations owned by David and Charles Koch, which have received an estimated $100 million from the federal government in recent years, would be affected. The libertarian industrialists have put hundreds of millions into an array of pro-GOP groups in recent years, according to painstaking reporting. They are perhaps the best-known example of using very big money to tilt electoral outcomes, but they are hardly alone in today's political culture.  

“There is no single solution to the problem of Big Money dominance,” said a letter by more than 50 progressive groups calling on Obama to act. “Today, we urge you to act on one option immediately — tackling  the issue of corruption in government contracting… We urge you in the strongest terms to issue immediately an executive order requiring full disclosure of political spending by business entities receiving federal government contracts.”

The coalition will ramp up public pressure in coming days. On April 2nd, the anniversary of the 2014 Supreme Court ruling striking down overall political contribution caps, there will be a rally in front of the White House where organizers will present petitions with hundreds of thousands of signatures. More than 50 rallies are planned nationwide.

Craig Holman, Public Citizen’s government affairs lobbyist and a lead organizer, is cautiously optimistic that Obama’s new boldness will produce positive results.

“For the first time, the White House has shown a willingness to ‘go it alone’ on major policy issues, using executive order as the primary vehicle,” he said. “It is because of this new attitude at the White House that a large coalition of more than 50 organizations has renewed our call for a transparency executive order on political spending by federal contractors, which includes more Forture 500 companies, as well as their senior executives as a condition of holding a government contract.”

“The anti-tax Kochs and their affiliated companies have received an estimated $100 million from the federal trough in recent years,” Holman said. “These Koch companies, along with other major behemoths in the Fortune 500, like Chevron, Verizon and Lockheed Martin, will all have to open their books on political spending by the companies and their senior executives, if the executive order is signed by President Obama.”

The push for this executive order is not new. While federal election laws have long barred individual contractors from making campaign contributions, there is no ban for corporate contractors that set up political committees or give to other groups, or for their corporate officers. Concerns about corporate contributions grew in 2010, after the Supreme Court deregulated corporate electioneering in its Citizens United ruling.

The following year, in 2011, Rep. Anna Eshoo, D-CA, and reform groups urged Obama to issue an executive order requiring federal contractor disclosure. There were months of meetings about the legal fine print. But as word got out that Obama might make political transparency a condition in government contacts, Republicans and right-wing media went on the attack—declaring that corporations have political speech rights. They cited to the Citizens United ruling to bolster their case.

By mid-2012, the White House backed off. Since then, Congress has passed riders on appropriations bills blocking the White House from requiring political disclosure as a condition for contract negotiations. What’s different today is not just that Obama has a new attitude toward executive orders, but that reformers also have a different approach: mandating political disclosure after a contract has been issued, Holman said.

“White House staff have been receptive, though we have received no confirmation yet of either ‘yes’ or ‘no,’ he said. “So the coalition — which consists of labor, religious groups, environmentalists, transparency advocates and campaign finance reform organizations — has launched a major grassroots campaign to apply public pressure along with negotiating directly with the White House.”

Spending on federal contracts is roughly half a trillion dollars, which is about 15 percent of the budget, according to the Congressional Research Service. The top 100 contractors are some of America’s biggest corporations, and include support services for the military overseas, weapons makers, computer firms, telecoms, energy companies, and others.            

“Money in politics is drowning out the voices of ordinary citizens,” wrote Katherine McFate, President and CEO, Center for Effective Government, in a recent e-mail that promoted the petition calling for an executive order. “Protections that once curbed the influence of corporations and the wealthy on elections have been eroded. And something can be done. Now. Without waiting for Congress to act.”


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