This year official federal-election spending surpassed $5.8 billion, compared with $3.1 billion in 2000. In the wake of Citizens United, the Supreme Court case that barred the government from restricting the amount of money that corporations could spend on political campaigns, unidentified groups shelled out over $200 million to influence campaigns, with the likely real (unreported) amount several times larger. The outsized role played by money in politics fosters a government that is most responsive to interest groups with access and resources. Hidden and unaccountable political spending is especially worrisome.
Colleges and universities, which control over $400 billion in endowment investments, have a clear and urgent responsibility to demand corporate political spending transparency -- to ensure that campaign spending by the companies in which we are invested is not corroding our democracy.
That is why The New School Advisory Committee on Investor Responsibility last month submitted a letter to the Securities and Exchange Commission calling for disclosure of political spending by public corporations. Read full article in The Chronicle. At present, companies are not required to disclose any information regarding the money they spend to influence political outcomes. Without mandatory disclosure, it is impossible for shareholders or taxpayers to effectively monitor the use of corporate resources for political activities. Disclosure of material corporate political spending would allow shareholders to track the spending practices of the corporations they own, provide the information necessary for colleges to invest prudently and in line with their missions, and illuminate the activities of corporations in the elections that govern this nation.
Although a few states, like Massachusetts and California, now require independent expenditure campaigns to disclose their donors, the haphazard patchwork of state rules is woefully inadequate in the face of the big money deluge for federal elections and the special interest lobbying that spans state borders. And while some major companies, among them Intel and Target, have given in to pressure from shareholders including state pension funds and foundations to agree to some limited political spending disclosure, those voluntary efforts cover just a small share of corporate political spending. New, mandatory SEC disclosure rules would require meaningful political-spending openness for all publicly traded companies, and would be a critical step toward restoring accountability.
Money's role in influencing elections might only increase in years to come, which is why there has never been a more important time for colleges to demand to know how their nearly half a trillion dollars are being spent.